Sunrise Homes & Renovations, Inc.

Make One Extra Mortgage Payment Every Year To Save Big

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Make One Extra Mortgage Payment Every Year To Save BigWhen you buy a home, you probably have a budget you will try to stick to. Many people choose a 30-year fixed mortgage, and by the time you pay off the home loan, you should own your home outright. At the same time, you might be thinking about paying off your mortgage more quickly to save money on interest. Even making one extra mortgage payment per year can provide a number of significant benefits.

You Can Build Up Equity Faster

One of the first benefits of making an extra mortgage payment every year is that you can build up equity faster. If you make an extra mortgage payment, that payment should go directly toward the principal. This means you don’t have to worry about paying down any interest with that extra mortgage payment, allowing you to build up equity in your home more quickly. 

You Save Money On Interest

If you make an extra mortgage payment, you pay down the principal more quickly. This means there is a lower remaining balance on which interest might accrue. Even making one extra mortgage payment every year can add up to tens of thousands of dollars in interest saved at the end of the loan. 

You Free Up Financial Resources Down The Road

If you make one extra mortgage payment every year, you could pay off your home loan years in advance. This means you don’t have to worry about making mortgage payments down the road, which can free up financial resources to cover other expenses. For example, you might be able to use the money you would have put toward your mortgage to put a child through college or retire early. Your savings will increase exponentially. 

Consider Making One Extra Mortgage Payment Per Year To Save Big

If you stay in your home for 30 years, there is a chance your income will go up even though your mortgage payments stay the same. Therefore, you may be able to afford to make an extra mortgage payment per year. Making only one extra mortgage payment every year can add up to big savings very quickly. 

Make One Extra Mortgage Payment Every Year To Save Big

by

Make One Extra Mortgage Payment Every Year To Save BigWhen you buy a home, you probably have a budget you will try to stick to. Many people choose a 30-year fixed mortgage, and by the time you pay off the home loan, you should own your home outright. At the same time, you might be thinking about paying off your mortgage more quickly to save money on interest. Even making one extra mortgage payment per year can provide a number of significant benefits.

You Can Build Up Equity Faster

One of the first benefits of making an extra mortgage payment every year is that you can build up equity faster. If you make an extra mortgage payment, that payment should go directly toward the principal. This means you don’t have to worry about paying down any interest with that extra mortgage payment, allowing you to build up equity in your home more quickly. 

You Save Money On Interest

If you make an extra mortgage payment, you pay down the principal more quickly. This means there is a lower remaining balance on which interest might accrue. Even making one extra mortgage payment every year can add up to tens of thousands of dollars in interest saved at the end of the loan. 

You Free Up Financial Resources Down The Road

If you make one extra mortgage payment every year, you could pay off your home loan years in advance. This means you don’t have to worry about making mortgage payments down the road, which can free up financial resources to cover other expenses. For example, you might be able to use the money you would have put toward your mortgage to put a child through college or retire early. Your savings will increase exponentially. 

Consider Making One Extra Mortgage Payment Per Year To Save Big

If you stay in your home for 30 years, there is a chance your income will go up even though your mortgage payments stay the same. Therefore, you may be able to afford to make an extra mortgage payment per year. Making only one extra mortgage payment every year can add up to big savings very quickly. 

Exploring Multigenerational Homes: They Are Becoming More Common

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Exploring Multigenerational Homes: They Are Becoming More CommonPurchasing a house is expensive. Not everyone has the money to put down 20 percent. One of the ways to make it easier to afford a house is to live in a home with multiple generations. Some people decide to move back in with their parents because they might have a difficult time affording a mortgage and student loans. Some parents move in with their children because they have health-related issues that need to be addressed. Now, multi-generational homes are becoming more common.

An Overview Of Multigenerational Homes

First, it is important to define a multigenerational home. This is a home that has two or more generations of adults living in the same building. Parents raising children does not qualify as a multi-generational home; however, if you add grandparents to the mix, now this is a multi-generational home. It is important to take a closer look at some of the reasons why people are living in multigenerational homes. 

The Benefits Of This Lifestyle

There are a number of significant benefits that come with living in a multi-generational home. Of course, it improves the financial situation because there are multiple incomes being put toward homeownership expenses. There are a variety of other benefits as well. For example, living in a multi-generational home improves bonds with family members and makes it easier to care for individuals with health problems. This also makes it easier to help kids go through school, and it can have a positive impact on mental and physical health. 

The House Should Be Larger To Accommodate Everyone

Because there are more adults living under a single roof, it is important to make sure the house is large enough. Everyone deserves to have some level of privacy, and this might mean the house has to have more bedrooms and bathrooms. It might also be helpful to have a basement or a mother-in-law suite.

Consider Multigenerational Homes

In the end, these are just a few of the numerous benefits and considerations people need to think about if they are considering living in a multi-generational home. If you are looking for a way to make the cost of a home more affordable, this could be right for you as well. 

Do You Want To Own A Second Home?

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Do You Want To Own A Second Home?

Build Wealth More Quickly

One of the first benefits of owning a second home is that you can build wealth more quickly. One of the major benefits of investing in real estate is that you can leverage the bank’s money to help you build wealth. Even though you may have only put down 20 percent, 100 percent of the property’s appreciation benefits you, as you own the home. If you own a second home, you can build wealth more quickly because you are doing this with two separate properties.

Enjoy Switching Up The Scenery

Many people like to own a second house because it allows them to switch up the scenery. If you live in the northeast, you may want to own a second home in the Southeast. If you live on the coast, you may want to purchase a second property in the mountains. That way, when you are ready for a change of weather or scenery, you can simply go to your second home. 

Generate Another Income Stream

Owning a second home allows you to generate another income stream. When you are not using the house, you can rent it out to other people. Or, you might be interested in the stability of a long-term rental. This is something that you can discuss with a real estate professional. 

Consider Owning A Second Home

In the end, there are numerous benefits that come with owning a second house. If you are looking for a way to diversify your investments, or if you are simply looking for a bit more flexibility, you should consider owning a second home as well. A professional can help you plan your finances accordingly, so you can put yourself in the best position possible to be successful. 

What’s Ahead For Mortgage Rates This Week – March 14, 2022

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What's Ahead For Mortgage Rates This Week - March 14, 2022Last week’s economic reporting included month-to-month and year-over-year readings on inflation. The University of Michigan released its monthly consumer sentiment index; weekly readings on mortgage rates and jobless claims were also published.

Inflation Reports: No Good News for Consumers

The war in Ukraine increased inflation rates in the U.S in February as costs for fuel, food and housing continued to rise. The federal government reported that month-to-month inflation rose by 0.80 percent in February; analysts expected a month-to-month increase of 0.70 percent as compared to January’s reading of 0.60 percent.

Core inflation, which excludes volatile food and energy sectors, rose by 0.50 percent in February and matched expectations. January’s month-to-month rate for core inflation was 0.60 percent and was the highest reading for month-to-month core inflation since 1981. Analysts reported that high inflation was impacting low and moderate-income Americans more as rapidly rising costs for housing, food, and fuel rose faster than wages for most.

Year-over-year inflation rose by 7.90 percent in February as compared to January’s reading of 7.50 percent. Core inflation rose at a year-over-year pace of 6.40 percent in February and surpassed January’s core reading of 6.00 percent. Core inflation readings exclude volatile food and fuel sectors.

Mortgage Rates, Jobless Claims Rise

Freddie Mac reported higher average mortgage rates last week as the rate for 30-year fixed-rate mortgages increased by nine basis points to 3.85 percent. Rates for 15-year fixed-rate mortgages averaged 3.09 percent and were eight basis points higher than in the previous week. The average rate for 5/1 adjustable rate mortgages was six basis points higher at 2.97 percent. Discount points averaged 0.80 percent for fixed-rate mortgages and 0.30  percent for 5/1 adjustable rate mortgages.

Last week’s initial jobless claims rose to 217,000 new claims filed as compared to 216,000 first-time claims filed in the previous week. Analysts expected initial jobless claims filed last week to match the previous week’s reading of 216,000 first-time claims filed.  Continuing jobless claims rose to 1.49 million claims filed as compared to the prior week’s reading of 1.47 million ongoing claims filed.

The University of Michigan’s Consumer Sentiment Survey reflected consumer concerns over inflation and the potential economic impacts of the Ukraine war. The March index reading of 59.7 was lower than February’s reading of 62.8 and the expected index reading of 62.0. Index readings over 50 indicate that most consumers are confident about economic conditions.

What’s Ahead

This week’s scheduled economic news includes readings on U.S housing markets, the Federal Reserve’s statement on interest rates, and the Federal Reserve chairman’s press conference. Data on building permits, housing starts, and sales of previously-owned homes will also be released. Weekly reports on mortgage rates and jobless claims will also be published.

Can I Pay My Home Loan Off Early If I Refinance?

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Can I Pay My Home Loan Off Early If I Refinance?Many people are looking for opportunities to save money on the cost of a mortgage. If you want to save money on your home loan, you might be thinking about refinancing. During the refinance process, you will replace your current home loan with a new mortgage. Some people want to refinance their homes to free up cash for a renovation project, while other people want to pay off their homes sooner. How can you pay off your home loan early through a refinance?

Reduce Your Interest Rate 

During the refinance process, you might qualify for a lower interest rate. There are numerous reasons why you might get a lower interest rate when you refinance your mortgage. The average interest rate may have come down, your credit score may have improved, or your debt to income ratio may have gotten better. If you were due to your interest rate, more of your monthly payment will go towards the principal, shrinking your balance faster. As a result, you may pay off your mortgage more quickly. 

Reduce The Term of the Loan 

If you refinance your home, you might be able to reduce the term of the loan. The term is how many years it takes you to pay off your mortgage. For example, you may be able to reduce your 30-year mortgage to a 15-year mortgage. If you shorten the term of your loan, you may qualify for a lower interest rate, which can help you save money; however, directly shortening the term of the loan could cause your monthly payments to go up. You could work with a professional who can help you with the math. That way, you understand exactly how much you owe every month. 

Consider Paying Off Your Mortgage More Quickly

If you want to save money on interest during the life of your loan, one way to do so is to pay off your mortgage faster. You might be able to do this if you refinance your home loan. Reach out to a professional who can take a look at the balance of your home loan. You might qualify for a refinance that can help you save money on your mortgage.