Most definitely true! I'm confident the 2.5%-4% rates a couple of years ago are gone for the foreseeable future - certainly not again in my lifetime. But over a 30-yr life of a mortgage, chances are very high that you will see rate increases. The slightly lower initial rates are negligible to the potential upside risk of much higher payments.
I don’t understand it. I bought my first home in 1993 before internet. Learned about ARMs and fixed rate at the library reading books about home buying. I even figured out how to buy first home with zero credit.
2009-early 2022 with exception of 2018, fixed rates mortgages were a no-brainer. Most people have no business putting less than 10% down or financing via ARMs.
So glad I locked in a 3% mortgage 9 years ago. That being said my property tax value increased 50% causing my home value to increase, causing my homeowner's insurance to increase, causing my escrow to increase, causing my mortgage payment to increase.
Property taxes have gone up as properties are being assessed higher., Home Owner's Insurance has gone up, utils have gone up, maint costs have gone up and NEVER NEVER NEVER get an ARM. When we bought our house in spring 21 we bought at a low price and at a great rate. We also have the Double Homestead Exemption, once we claimed it our property taxes almost halved, they also assess at BOUGHT price NOT appreciation so my house could increase 10 times over my property taxes can't go up. ALSO once we turn 65 and bring in 25k and less for a single person or 30k for a couple property tax FREEZES. ALSO 100% disabled vets are property tax exempt as are current military. ALSO to battle insurance costs raise your deductibles, get discounts for paying in full, get discounts for alarm systems, fire systems and whatever other discounts they will offer that fit you. We bought USDA, So they charge a very small fee per month and it's for the life of the loan, I only pay $18.10. We also overpay the LOW principal every month ever since our first payment was due, knocked YEARS off the life of the mortgage, Each COLA we add another $10 per month. So starting in Jan 25 we will pay an extra $50 a month on a $126 a month principal. And just because a lender tells you you can be approved for a half a million dollar house DOESNT MEAN YOU BUY A HALF A MILLION DOLLAR HOUSE! Think long term, Can I afford this house if I get laid off, injured and cant work for a long time if ever, if my S O passes, can I pay this by myself. THINK PEOPLE!
My brother was told do not sign a mortgage that has adjustable rate on the house but he being hard headed as usual did and his mortgage went from $1800 to $2800 and lost the house after refusing to pay .Fixed rate and a experienced realtor who know how to help you win everyday.
If anything is a scam… it is realtors. Completely unnecessary jobs. People think you need a realtor… you don’t. 80% of the time they do little to no work and collect 7% of the money, for doing absolutely nothing. Before the internet, realtors made a little more sense. Now it is a fluff job and completely unnecessary. I suppose if your not very smart, or just don’t care to learn anything about the housing market then I suppose a realtor is a welcome shortcut. But as someone with realtors in the family, being a former realtor myself (as a side gig), and plenty of property sale and purchase experience under my belt…. Realtors are often far more of a hinderance and are not guaranteed to save you in any case. There are horror stories of people buying homes with major issues that the realtor failed to notice possible problems or offer solutions. Many of my colleagues knew little more of the housing market than their buyers and sellers. They would just list the house and cross their fingers. Actually GOOD realtors are few and far between. Most of them got their realtor license over a weekend while day drinking…. I am just saying, I have rarely seen an industry with such a variation in professionalism, talent and skill, and customer service. Most realtors don’t even show homes anymore. They have a lockbox on the door and just send people to go through the home themselves. The entire job position is nearly pointless anymore. Just a little story… My parents were selling a home a while back. They hired a realtor, who did absolutely nothing, but list the property with the horrible photos he took. The house sat on the market for 6 months. I drove to my parents city, fired her realtor who actually tried to tell me I couldn’t fire him, and spent about 2 weeks on her home. Fixing cosmetics like the bricks edging the yard had become kaddywompus so I straightened them all. Trimmed and cleaned plants and trees, and pulled all their crap out of the house and staged it with choice pieces in minimal and modern styles. We painted and did a few repairs. The difference was literally crazy. I re listed the house for 125,000 more money (the neighborhood said we would never get that much)…. It sold in 1 week with 2 people in a bidding war going even higher than asking price. This was in the early 2000’s so the housing market wasn’t like today. Bidding wars were rarer then. When this happened, I was not a realtor… I got my license after this and I realized I was a better realtor than most realtors with just my common sense and personal home knowledge. Selling a home is a job, most realtors make the sellers do the work and just list properties “As is”. Personally I think realtors are far more useful when buying a home, than selling one in most circumstances. Sorry for the rant but I feel strongly about this.
Well it sounds like he did not have the money to buy the house and should have just been a renter. Adjustable rates are only attractive to broke people and investors. Investors are just looking to flip their purchase so they are okay but broke people should by within their means or just rent
My fixed rate is at 2.25%... I keep getting texts/calls... On how I can save??? My vehicle is at 5.9%... Some hang up on me... Some tell me... That I am "All" set... And I am doing great...
Google is just an arm length away. Growing up we only had the library & typewriters. People do the same with cars, fall in love with something they can’t afford. Realtors, salesmen, lenders help you through the process so they can get paid.
Don’t think so. When you buy a new build your taxes are low for the first year - just land value. The next year is what no one tells you about, not even your agent.
Mortgage rates are currently at an all time high since 2000(24 years) and based on statistics on inflation, we might see that number skyrocket further, a 30-year fixed rate was only 5% this time last year, so do I just keep waiting for a housing crash before buying or redirect my focus to the equity market
The top experts, however, have access to confidential information and data that is not made available to the broader public. Being knowledgeable enough to use them successfully is quite another. Big returns, not changing stochastics, are the key. Rewards and risks must be balanced. To reach your aim, pick the right size and turn your edge as often as necessary.
I concur; I've been in frequent communication with an investing advisor for more than 17 months. I definitely remember needing inspiration to keep my business running after a protracted divorce. I researched licensing consultants, sometimes known as portfolio coaches by some.
I require suggestions on how to restore my portfolio and create more effective strategies in light of the huge declines. Where can I locate this instructor?
REBECCA NASSAR DUNNE is her name. She is regarded as a genius in her area and works for Equity Services inc. She’s quite known in her field, look-her up.
I bought a foreclosed home in 2009 during the Great Recession. It very small compared to the McMansions that others desire, but it was all I could afford. I threw as much money at the mortgage as I could and 7 years later, I paid it off. There’s no way I could afford today’s home prices if I were to start all over. The important thing is to educate yourself as much as possible before purchasing a home. Don’t just jump into it because you can easily be taken advantage of, especially when it comes to all the lingo in dealing with finances and taxes.
My husband and I got our house during the Great Recession!!! I FIRED our first realtor because he kept showing us LARGE houses that we weren't interested in!!! Our little 3 bedroom home is just the right size!!! Quiet neighborhood with good neighbors!!! Vegas is somewhere that EVERYONE wants to move to!!! The value of our house has skyrocketed!!! Since my husband passed a little over 2 years ago, I can make the payments with one check in the household!!! I'm naturally cheap (not thrifty) and can keep the power, water and gas bills paid. Living within my means makes all the difference in the world!!! I drive a 22 year old VW!!! 😅😅😅
0:20 This is what happens when girls choose to stay on code VS tell your sister the truth. Taxes don’t raise $5,000 in that short period of time. She had an adjustable interest rate that she’s not sharing.
Since mortgage rates are at their highest point in 24 years, since 2000, and inflation data suggests that they may rise even more, a 30-year fixed rate was only 5% at this time last year. Should I wait for a housing meltdown before making a purchase, or should I shift my attention to the stock market?
The stock market is no different, to maintain profit you need to have some in-depth knowledge on the market. I mostly just buy and hold stocks, but my portfolio has been mostly in the red for quite awhile now. Unfortunately to be able to make good gains, you’ll need to be consistent and restructure your portfolio frequently.
In my opinion, it was much easier investing back in the 80s but it’s a lot trickier now, those making consistent profit in these times are professionals reason I’ve been using an advisor for the past 5 years to consistently build my portfolio in preparations for retirement.
Thank you for this tip. It was easy to find your coach. Did my due diligence on her before scheduling a phone call with her. She seems proficient considering her resume.
Here’s a piece of advice I used, when I was younger I bought a house and I absolutely went frugal until I’d paid off the mortgage, I used coupons shopped around only had one holiday every 2 years etc, once I’d paid the mortgage off 10 years early I can now sit back.
In the 90's, my mom educated me on what came to pass in '08. I had no idea mortgages are sold, and a flex-rate mortgages promise returns, and if folks get greedy, "People lose their homes, so NEVER do an adjustable rate mortgage-EVER."
it is like buying a car. the sooner you pay it off the better. Nothing is wrong with an adjustable rate mortgage if you can afford to pay it off in a year. That first year or two has a set interest rate so if you can afford to pay it off in a year and it is lower interest rate that year than conventional why not?
I’m the only person I know who ever had an ARM go down over the life of a 20 year mortgage. Buying a nearly 100 year old house in 1983, the bank required 20% down (no PMI) and interest rate adjustments every 5 years. Needless to say, interest rates were jacked in 1983, as I recall ours was about 12%. Every 5 years our mortgage payment decreased because fed rates kept dropping. Unbelievable!
The Federal Reserve will drop interest rates to stimulate the economy. They raise it to control inflation (Quantitative Easing and Quantitative Tightening). There was sky-high inflation due to the late oil crises of that era (remember long gas lines and 55mph highway speed limit?).
Do I just keep waiting for a housing crash before buying, or should I shift my focus to the equity market? A 30-year fixed rate was only 5% this time last year, and mortgage rates are currently at their highest point in 24 years, since 2000, and inflation data suggests that they may continue to rise.
The stock market is no exception; maintaining a profit requires a thorough understanding of the market. I primarily just purchase and hold stocks, but for a long time now, my portfolio has been largely losing money. Unfortunately, you will need to remain consistent and often rearrange your portfolio in order to be able to generate good gains.
In my opinion, it was much easier investing back in the 80s but it’s a lot trickier now, those making consistent profit in these times are professionals reason I’ve been using an advisor for the past 5 years to consistently build my portfolio in preparations for retirement.
Finding financial advisors like “Sharon Ann Meny” who can assist you shape your portfolio would be a very creative option. There will be difficult times ahead, and prudent personal money management will be essential to navigating them.
Thanks for sharing. I curiously searched for her full name and her website popped up immediately. I looked through her credentials and did my due diligence before contacting her.
In my state, we get our property tax bill in October. If escrow is short, which it Always will be in a 1st year new build, you have til December to pay the difference so the deficit doesn’t reflect in your mortgage. Our first year new build was only escrowed for $1,600. With the homestead exemption, we were short $1,100 in escrow. I researched and researched as much I could digest regarding new builds before we signed our contract, so fortunately we were able to plan and save up the difference and paid it. Our insurance went up but I shopped around and it increased $75 a year vs the initial $187 it would have been if we stuck w/ our initial insurer. We didn’t have a real estate agent and the buyers agent didn’t tell us squat about the initial property taxes on new builds. It’s up to the buyer to do their due diligence at the end of the day.
@@realestatesteph is the mortgage holder allowed to not ask you if you want to pay the difference in your escrow shortage? Or are they allowed to just send you a check with your little $40 that you’re over? Then at the first of the year when they do your escrow analysis, you can be really short.! when my bank does the yearly escrow analysis they never include an option to add money to your escrow account so that your payment doesn’t doesn’t increase. Does anybody know if this is legal?
It isn’t always just new builds. The first house I bought I knew they underestimated escrow for my taxes so I set aside money each month to cover it. However, the next year they went gang busters on over calculating for taxes. The whole situation was very frustrating.
it is the reassessed value that bite u in the butt later after one close on the property same thing happened to me but it worked out because i got my 50k homestead exemption so my payment actually went down 90 bucks a year
She definitely got an ARM which is why it went up so much. However if you buy a new build be aware that the 1st year's property tax is the land only, it will be reassessed the 2nd year and your taxes will SKYROCKET. For this reason, do as I did and pay like an extra $500/month that 1st year and fill up your escrow account so when that big hit happens, it's no big deal.
Whenever you’re buying a new construction overfund your escrow by at least $2K - $3K. If you’re purchasing a new build in Texas, especially Harris County, the tax appraisals are conducted in March/April, and the tax bills go out beginning in October. If your home isn’t completed prior to the tax appraisal, your tax escrow due at closing will be based on the unimproved value of your property. This will cause your escrow to be underfunded, and you will be short on your tax payments. Your mortgage company will notify you of your escrow account being underfunded and give you some time to get the balance where it needs to be. If you don’t fix the shortfall within the allotted time your monthly note will go up to get escrow balance where it needs to be. Usually the escrow account has to have two months worth of taxes and homeowner’s insurance in it.
Yes--buy less than you can afford. The year I bought my first house, I was laid off and spent the next two years in flaky, shaky job situations. It was all I could do to scrape together a mortgage payment, buy groceries and keep the bills paid.
Truth: most of these people. COULD NOT afford the home they wanted. So they went “monthly payment” shopping. A fixed rate would have had the the home OBVIOUSLY unaffordable. People do the same with CAR LOANS, car leases, buying on a credit card and justifying the monthly cost.. if you can’t afford it…don’t buy it
She mentioned it went up over $5k in the last 7 yrs. That coincides with the HUGE interest rate increases AND home values that just exploded over since the pandemic. And of course - depending on where she lived - home insurance went up dramatically. Like you stated - it was a deadly cocktail. DECADES ago - many seniors were displaced out of Silicone Valley as they saw rental prices going up (rentals hitting $3k/mo) and property taxes going to $10k/yr. More than doubling - if you were on a fixed income, you had no choice to move out of the area.
Real Estate should not be a horror story, Real Estate needs to go back to the days when people who sold their homes and gave mortgages to the buyers. Once corporations meaning banks and appraisers with artificial values entered into the field that's when the corruption began.
It’s so there’s always a way to take it from you or take it from your family. The fact that HOA’s can conjure up some insane bill and take your home if you don’t pay it is also absurd.
Yes, property tax is a scam, and I am ok with the yearly property tax as long as the school district is good. My issue is that they charge you property tax for over 30 year on the value of the house, but when it's time to sell, they will tax you on the profits.
We signed a purchase contract for a new build and put down $15,000 earnest money. Rates were around 2.5%. By the time the house was built and we could lock in, the rate was 6.125. Our payment went from an estimated $2800 to $4600. We could have walked away and lost our $15,000. We felt stuck. We’ve been in two years now and have been hoping rates would go down, which they haven’t.
@@FTYC2022I don’t know if I’d use the word “regret”; I think, knowing what I know now, I might have made different decisions…but there’s no way to go backwards. I still believe real estate is a good investment. However, I have now put my house on the market. I really love the house, but it’s much bigger than what we need, and I would rather have more disposable income, rather than paying the high mortgage payment every month.
I have a fixed rate mortgage. Property taxes went up (my home’s fair market value) … and I’m paying ~124 more a month. I bought in 2021 and the new tax went into effect in 2024. I think it’ll be assessed again in 3 years. I will look into your suggestions… I am in NC. My fixed rate is 2.4%. I will not do anything to loose that 30 year rate.
Great video! Mine is fixed at 3%, 15yr (refinanced during pandemic), no PMI, and I pay extra toward the principal. If I had it to do over, I would not pick Collin County, TX. Lord help me! Be safe out there!😊
I refinanced during the pandemic and was at a 2% We just bought a new house and I can’t wait to refinance into a lower rate. I know it’ll never be 2 again but love the house.
Banks here in the Netherlands take loan-to-value into account when offering an interest rate. I refinanced in ‘22, 10 years after I bought the place. Since my house appreciated in value quite a bit and I paid off part of the loan, they offered an attractive rate. I got 1.6% fixed for 20 years…. And when I buy a new house, I can probably move the mortgage to it.
I live in NJ, and I was paying $2,345 a month and a year they increased to $3,570 a month. We almost lost the house because we didn’t have enough money to pay. Thanks to a program we got to pay the month behind and they lower the mortgage to $3,100 a month now.
The problem is New Jersey has people convinced It’s the only place you can live a good life and make good money. Yeah, you make good money, but you give it all to the state. I live in North Carolina. My house is 17 years old. My taxes are $1000 a year on a 2000 square-foot four bedroom house. You have to get out of the matrix. people are afraid to leave there. best decision I’ve ever made
Hope it’s not a DR Horton build. So many videos on YT about the quality of homes they build. Do your research, hire your own Inspector, and hopefully it’s not in a HOA. Good luck. 😀
I will shout from the highest mountain. Until the person has the deed in their hands. The lien holder should be responsible for the taxes. I know the deal breaker is the word mortgage . But I strongly feel that the person who actually hold the deed. SHOULD PAY THE TAXES.💁🏽💯
@@realestatesteph but no seller would ever do that on lease to own which I think is what his post is referring to. New subscribers. I like how you speak so clearly and with really HELPFUL information for the average home buyer.
@@realestatesteph Wouldn't give a damn, adjustable rate = getting slammed no lube. If I budget, I'll have extra but I'll take a fixed at 5 percent a year over an adjustable that starts at 2 percent, then up to 5 percent and than higher. Ive never seen one go back down to its lowest price. Ive only ever seen people suffer or falter and lose their homes using the adjustable. I'll be damned- not touch it ever and teaching my kids not to touch that with a 10 foot pole. I'll be sleeping in my car till I can earn enough cash to buy with no loan or mortgage. The fact that loans and mortgages are normal- it shouldn't be Mortgages and loans are SCAMS. If you can't pay cash- you shouldn't buy the home. My car- cash My college- cash My trade school- cash Loans and mortgages are SCAMS. They force you to have homeowners insurance, increases taxes- increase payments due to loan rates. Suffered 3-4 years using a planet fitness card to shower, live in your car so one day you can live in your own home . Don't even try me with that "it's impossible" I'm doing it- and even in this economy, I'm making it possible cause I'm willing to Suffer now to avoid suffering later 💯
Pmi can be dropped before 2 years. I got mine dropped shortly after the first year. I did improvements on my house and then got it appraised. Sent the appraisal to my mortgage company. You have to call your mortgage co. First to tell them you want to remove pmi, they’ll tell you which department has to receive the appraisal. If you get the place appraised high enough, pmi gets dropped.
That's what I am planning on doing on top of paying another rack on to the principal each month to get my pmi off. I have been in the home for about a year now and I know the value went up since then. My monthly payment went down 300 dollars after 6 months, and I had no idea why. Long story short, the home hadn't been reassessed since the owner paid 100,000 dollars for it 20 years ago lol but it did go back to the balance I was paying before it dropped 300 dollars so that was okay. But it did cause me to have a shortage on my escrow 😖 I plan on paying my house off in 12 years and not 30. I don't want to have to worry about pmi and insurance my whole life
Great video and thank you so much. I’ve been in my condo about 20 years and never really understood homestead for taxes. I was just told to make sure I applied for it and I did, but never really understood it. You explained it perfectly.
I live happily ever after in my spacious one bedroom apartment, with new appliances, free swimming, free gym, free office space, free parking. When something breaks I pick up the phone and someone else fixes or replaces it for free in a couple of days.
yeah it happened to my brother! he bought an arm his pmt went from 1,800 to 5,000 whenever i asked him anything he just did not want to discuss it with me - so i just backed off!! 3yrs later he lost it - tried to sell it but couldn't by the time he came to me for help - it was too late!!!
Years ago I tried getting rid of my PMI when I reached that 80/20 mark. The bank refused to drop it and said I had to prove it by having my house appraised at MY expense. I eventually switched to another bank and the original bank lost my business
In Texas don't forget MUD taxes too if you live in suburb. Be prepared for that as well in addition to property taxes. Your MLO should have sat down with you & discussed your estimated monthly payment, estimated MUD tax rate, etc. I applied for the homestead exemption 2 weeks after closing, keep your escrow overfunded jic. Good luck! Thanks for the video😊.
As someone who's been in a mortgage industry since 1989, and actually a licensed insurance agent since 2010, there's some truth in the fact that she was paying taxes on unapproved land. But she also probably got a buy down on her rate from the builder, that was only meant to last a year, and maybe her insurance went up. But $5000 jumpedis typically unheard of there's more to the story. Additional issue may be that she did not file for her homestead exemption, which caps your taxes. Secondly, the reason some builders only used the taxes for the unapproved land is so that they can qualify the buyer on the lower tax rate. Debt to income ratio.
You can dispute a tax increase by simply having a real estate agent supply you with comps in your area. Home prices are now falling so your request is justified.
Yeah I agree. The lady in the beginning clearly purchased a very large house but asked for adjustable rate. It had to be that. Because homestead exemption would not allow the taxes to go up that much in 5 years. She might be trying to hide how rich she is and maybe has more than one house and didn't have homestead exemption if she truly had that large of a tax increase.
It was today (12/30/2024), that I came across this video. It’s crazy to think that I only started the video because I found the guy attractive, and wanted to hear his voice for a moment lol. Upon observation, I did indeed listen to his message regarding essential tips and tricks, and Steph is absolutely correct. Without going into the nitty gritty, he conveyed everything a beginner would need to know and be aware of, and everyone else who may be a bit more experienced. I’ve learned a few things from him today, and I’ve already purchased two homes. Take heed, y’all!
Purchased a new build a few years ago, and that is exactly what happens. They tax the value of the land when you build - so you get a tax break the first year, but the city can assess the value every year. Now I pay 16k a year for my house. It’s out of control.
Do bi-monthly payments and add an extra month's payment amortized over the year. A 30-year mortgage can be reduced by almost 1/3. Not only is the mortgage paid sooner, but you save a ton in interest without needing to be shackled to a 15-year note payment.
I agree with you regarding the "Adjustable Rate Mortgage " and during my buying any of my new homes ,I always secured a conventional 30 year mortgage ,with a large down payment . I also drive a 1999 used Mercury car that I purchased 1n 2008 with 70,000 miles on it and I am still driving that car.
Laughs in California resident. My home owners insurance increased (by a lot) as did my car insurance. I have my car bundled with my homeowners policy. I called around to get better rates for both. While I could find car insurance at a slightly cheaper rate, those companies were no longer underwriting homeowners policies in California. Mind you, I live absolutely nowhere near a fire or flood zone, and having separate policies wasn't going to save me any money. So I'm stuck with Farmers for now. I may have lucked out big time with my 2.85% refi, but now my insurance costs wiped all of that away, leaving me with a higher mortgage. Oh, that and my property taxes increased also 😢
Paused out of this video… Thanks for the encouragement Brother! Just Lowered property insurance!!! Yippee! Thanks for the push to make that call. Got a $365 check coming! 🙏🏾❤️ Now back to the video! You know I’m subbing right?!!! Thank you! 🙏🏾❤️
You might want to check, in NY state PMI doesn't drop off even if home value has risen. It only drops off after you have paid 20 percent of purchase price. Doesn't matter that your homes value has tripled.
All this is true but it’s only symptoms. The true cause are houses have become financialized. Instead of a home to live in. Since this is the case “they” banks, government, insurance get you either way.
Yeah , but what’s also changed is the size of the houses people think they need . When I was growing up we shared bed rooms and had one bath ! Now young people want a home that’s the size of most people’s dream home ( in the past ) . There used to be a starter home , now the younger generation wants a a luxury home . Well banks and builders saw this and built for it which drove up the “ average home” price , because the “ average” home is no longer even remotely what the “ average “ home used to be
Between the increase in the homestead exemption to $100k in Texas, being diligent in shopping my insurance every year, an maximizing the credit score factors that go into insurance scores, my monthly mortgage payment is lower this year than it has been in any previous year, despite the increase in property value. Texas allows insurance companies to factor in credit scores when determining insurance rates, but there isn't actually a way to find out what your insurance credit scores are, and information on the scoring factors is sparse. You can have decent credit per FICO, but still be paying double what you should for insurance due to your insurance credit scores, and never know why!
My homestead tax cap is 4% in Maryland. I'm gasping at 10% lol Ive been in my place since 2018 and I realized this year that I need to shop around for a new homeowners insurance company.
A good Real Estate Agent should tell you. Mine did and she made sure at closing the money for first year taxes were in escrow. I'm a disabled veteran and don't pay taxes but the first year, I did on a new build.
I live in Texas and after that big freeze in 2021 my water pipes frize and they kept turning the electric off and when they turned it back on there was an absolutely gigantic power surge that fried my wiring. My insurance company refused the water because they said the dsmage was not from water but was caused by perspiration and refused coverage. On the electric they said it was not an act of God, that it was man-made (the electric company) and so not covered. Then they cancelled my insurance. I've been told it could cost as much as $25,000 to rewire my house. Mow I live in a house with no water and only partial electricity. The appraisal district says my small house built during WW II is woth a quarter of a million (it most definitely is not). I am 74 on social security.
So, I tried that in Northern VA and the Morgage company ran it off of my original appraisal and not today's value, so I had to pay to have an appraisal done of $200.00 and that worked got rid of the 84.88 PMI.
I didnt watch the video but this is more than likely taxes and adjustable rate mortgage usually 15 year mortgage. Never get these unless you plan on selling quickly
I got a 5/5 ARM in 2014 at 2.75% with 20% down. Paid down principle incase things went sideways. Rate adjusted to 4% in 2019 which was the max(could only increase 1.25% every 5 years). Secured a fixed 10 year loan in 2021 for 2.375%
She bought a five bedroom house and was paying only $2,500/month? Higher property taxes are an issue when you buy an older house that's appreciated a lot in value as your property valuation will jump and then your property taxes will later on. Our property taxes have gone up about 350% since the late 1980s. Is that a big deal? Increases were slow and incremental.
I made the adjustable rate mortgage trap back in the late '70's. That & the Condo fees going up up up, just killed me until I sold, thankfully. Never again. I get a fixed rate.
My mortgage went down $80 and got a $1400 escrow check back apparently i was paying to much into escrow. My porpety taxes went up and i kick my insurance out the door and got $1000 cheaper insurance.
I had a friend that did the dumb thing and got an adjustable rate where he could basically buy way more house than he can afford so his payment started out at like 1500. They balloon to 8500. He ended up losing the house and all the money he put down such a bad mistake.
Been in my house for 14 years now and have had a escrow shortage 12 of those years based on property values going up. Should have definitely filed homestead early instead of 6yrs in. Honestly I would have done a lot differently if I was able to do it over again.
Nover buy with a ARM loan. Always a fixed rate, and keep a close eye on your escrow account. If you have a $2000 payment put $1000 into your escrow in Nov before they compute your payments and it will drop your future payments. If you have extra money always put into the principal, even if it's $50 straight to principal. If you know your insurance went up pay upfront depositing to escrow account
Buying an adjustable rate mortgage is like stepping into quick sand and expecting not to sink.
Dancing with the 👿
Most definitely true! I'm confident the 2.5%-4% rates a couple of years ago are gone for the foreseeable future - certainly not again in my lifetime. But over a 30-yr life of a mortgage, chances are very high that you will see rate increases. The slightly lower initial rates are negligible to the potential upside risk of much higher payments.
Yes. People need to make the sacrifices to save money for a down payment than isn't the minimum to get them into the house.
Before I even watched, my question was “did she have an ARM?” 🤦🏽♀️ We got a new construction home and didn’t have this issue 😬
Alas, having a 30 year fixed rate mortgage is pretty much the only in the US. Most other countries only offer a fixed rate for up to 5 years.
Who in hell would get an adjustable rate mortgage, after 2008?
LOTS of people
1980’s
I don’t understand it. I bought my first home in 1993 before internet.
Learned about ARMs and fixed rate at the library reading books about home buying.
I even figured out how to buy first home with zero credit.
The same type of person who is fifty-five years old and a401(k) balance of zero. You can’t fix stupid.
2009-early 2022 with exception of 2018, fixed rates mortgages were a no-brainer. Most people have no business putting less than 10% down or financing via ARMs.
So glad I locked in a 3% mortgage 9 years ago. That being said my property tax value increased 50% causing my home value to increase, causing my homeowner's insurance to increase, causing my escrow to increase, causing my mortgage payment to increase.
Pay your home owners insurance separate which will decrease your escrow
@@nicolemollette1407it's not worth you need to buy the land
Property taxes have gone up as properties are being assessed higher., Home Owner's Insurance has gone up, utils have gone up, maint costs have gone up and NEVER NEVER NEVER get an ARM. When we bought our house in spring 21 we bought at a low price and at a great rate. We also have the Double Homestead Exemption, once we claimed it our property taxes almost halved, they also assess at BOUGHT price NOT appreciation so my house could increase 10 times over my property taxes can't go up. ALSO once we turn 65 and bring in 25k and less for a single person or 30k for a couple property tax FREEZES. ALSO 100% disabled vets are property tax exempt as are current military. ALSO to battle insurance costs raise your deductibles, get discounts for paying in full, get discounts for alarm systems, fire systems and whatever other discounts they will offer that fit you. We bought USDA, So they charge a very small fee per month and it's for the life of the loan, I only pay $18.10. We also overpay the LOW principal every month ever since our first payment was due, knocked YEARS off the life of the mortgage, Each COLA we add another $10 per month. So starting in Jan 25 we will pay an extra $50 a month on a $126 a month principal. And just because a lender tells you you can be approved for a half a million dollar house DOESNT MEAN YOU BUY A HALF A MILLION DOLLAR HOUSE! Think long term, Can I afford this house if I get laid off, injured and cant work for a long time if ever, if my S O passes, can I pay this by myself. THINK PEOPLE!
Yep. I'm paying 2.25%. ❤❤❤
Nothing like paying taxes on unrealized gain
My brother was told do not sign a mortgage that has adjustable rate on the house but he being hard headed as usual did and his mortgage went from $1800 to $2800 and lost the house after refusing to pay .Fixed rate and a experienced realtor who know how to help you win everyday.
This lady lost her house too
@@realestatesteph Well, she made very stupid decisions. It was expected. Hope she learns from this mistake.
My daddy always said a hard head make a soft behind 😅
If anything is a scam… it is realtors. Completely unnecessary jobs. People think you need a realtor… you don’t. 80% of the time they do little to no work and collect 7% of the money, for doing absolutely nothing. Before the internet, realtors made a little more sense. Now it is a fluff job and completely unnecessary. I suppose if your not very smart, or just don’t care to learn anything about the housing market then I suppose a realtor is a welcome shortcut. But as someone with realtors in the family, being a former realtor myself (as a side gig), and plenty of property sale and purchase experience under my belt…. Realtors are often far more of a hinderance and are not guaranteed to save you in any case. There are horror stories of people buying homes with major issues that the realtor failed to notice possible problems or offer solutions. Many of my colleagues knew little more of the housing market than their buyers and sellers. They would just list the house and cross their fingers. Actually GOOD realtors are few and far between. Most of them got their realtor license over a weekend while day drinking…. I am just saying, I have rarely seen an industry with such a variation in professionalism, talent and skill, and customer service. Most realtors don’t even show homes anymore. They have a lockbox on the door and just send people to go through the home themselves. The entire job position is nearly pointless anymore.
Just a little story… My parents were selling a home a while back. They hired a realtor, who did absolutely nothing, but list the property with the horrible photos he took. The house sat on the market for 6 months. I drove to my parents city, fired her realtor who actually tried to tell me I couldn’t fire him, and spent about 2 weeks on her home. Fixing cosmetics like the bricks edging the yard had become kaddywompus so I straightened them all. Trimmed and cleaned plants and trees, and pulled all their crap out of the house and staged it with choice pieces in minimal and modern styles. We painted and did a few repairs. The difference was literally crazy. I re listed the house for 125,000 more money (the neighborhood said we would never get that much)…. It sold in 1 week with 2 people in a bidding war going even higher than asking price. This was in the early 2000’s so the housing market wasn’t like today. Bidding wars were rarer then. When this happened, I was not a realtor… I got my license after this and I realized I was a better realtor than most realtors with just my common sense and personal home knowledge.
Selling a home is a job, most realtors make the sellers do the work and just list properties “As is”. Personally I think realtors are far more useful when buying a home, than selling one in most circumstances. Sorry for the rant but I feel strongly about this.
Well it sounds like he did not have the money to buy the house and should have just been a renter. Adjustable rates are only attractive to broke people and investors. Investors are just looking to flip their purchase so they are okay but broke people should by within their means or just rent
Fixed rate not variable rate. "If you can't afford at the current rate, do not buy it! Great video!
Exactly!
My fixed rate is at 2.25%...
I keep getting texts/calls... On how I can save???
My vehicle is at 5.9%...
Some hang up on me... Some tell me... That I am "All" set... And I am doing great...
Sounds like she has a ARM, adjustable rate mortgage
That’s exactly what it was
Yeah, just ONE instead of two. 😇
Google is just an arm length away. Growing up we only had the library & typewriters. People do the same with cars, fall in love with something they can’t afford. Realtors, salesmen, lenders help you through the process so they can get paid.
No ARM adjusts this quickly. The minimum is 5 year these days.
Don’t think so. When you buy a new build your taxes are low for the first year - just land value. The next year is what no one tells you about, not even your agent.
Mortgage rates are currently at an all time high since 2000(24 years) and based on statistics on inflation, we might see that number skyrocket further, a 30-year fixed rate was only 5% this time last year, so do I just keep waiting for a housing crash before buying or redirect my focus to the equity market
The top experts, however, have access to confidential information and data that is not made available to the broader public. Being knowledgeable enough to use them successfully is quite another. Big returns, not changing stochastics, are the key. Rewards and risks must be balanced. To reach your aim, pick the right size and turn your edge as often as necessary.
I concur; I've been in frequent communication with an investing advisor for more than 17 months. I definitely remember needing inspiration to keep my business running after a protracted divorce. I researched licensing consultants, sometimes known as portfolio coaches by some.
I require suggestions on how to restore my portfolio and create more effective strategies in light of the huge declines. Where can I locate this instructor?
REBECCA NASSAR DUNNE is her name. She is regarded as a genius in her area and works for Equity Services inc. She’s quite known in her field, look-her up.
I just checked her out on google and I have sent her an email. I hope she gets back to me soon.
I bought a foreclosed home in 2009 during the Great Recession. It very small compared to the McMansions that others desire, but it was all I could afford. I threw as much money at the mortgage as I could and 7 years later, I paid it off. There’s no way I could afford today’s home prices if I were to start all over. The important thing is to educate yourself as much as possible before purchasing a home. Don’t just jump into it because you can easily be taken advantage of, especially when it comes to all the lingo in dealing with finances and taxes.
Congratulations that sounds awesome and I salute you being diligent and responsible
My husband and I got our house during the Great Recession!!! I FIRED our first realtor because he kept showing us LARGE houses that we weren't interested in!!! Our little 3 bedroom home is just the right size!!! Quiet neighborhood with good neighbors!!! Vegas is somewhere that EVERYONE wants to move to!!! The value of our house has skyrocketed!!! Since my husband passed a little over 2 years ago, I can make the payments with one check in the household!!! I'm naturally cheap (not thrifty) and can keep the power, water and gas bills paid. Living within my means makes all the difference in the world!!! I drive a 22 year old VW!!! 😅😅😅
0:20 This is what happens when girls choose to stay on code VS tell your sister the truth. Taxes don’t raise $5,000 in that short period of time. She had an adjustable interest rate that she’s not sharing.
Def had an ARM
She can do bad all by herself though. She’s strong and independent 🤮
Since mortgage rates are at their highest point in 24 years, since 2000, and inflation data suggests that they may rise even more, a 30-year fixed rate was only 5% at this time last year. Should I wait for a housing meltdown before making a purchase, or should I shift my attention to the stock market?
The stock market is no different, to maintain profit you need to have some in-depth knowledge on the market. I mostly just buy and hold stocks, but my portfolio has been mostly in the red for quite awhile now. Unfortunately to be able to make good gains, you’ll need to be consistent and restructure your portfolio frequently.
In my opinion, it was much easier investing back in the 80s but it’s a lot trickier now, those making consistent profit in these times are professionals reason I’ve been using an advisor for the past 5 years to consistently build my portfolio in preparations for retirement.
My partner’s been considering going the same route, could you share more info please on the advisor that guides you
Google Annette Christine Conte and do your own research. She has portfolio management down to a science
Thank you for this tip. It was easy to find your coach. Did my due diligence on her before scheduling a phone call with her. She seems proficient considering her resume.
This wasn't driven by taxes, it's the ARM.
Both
Here’s a piece of advice I used, when I was younger I bought a house and I absolutely went frugal until I’d paid off the mortgage, I used coupons shopped around only had one holiday every 2 years etc, once I’d paid the mortgage off 10 years early I can now sit back.
Smart man!
In the 90's, my mom educated me on what came to pass in '08. I had no idea mortgages are sold, and a flex-rate mortgages promise returns, and if folks get greedy, "People lose their homes, so NEVER do an adjustable rate mortgage-EVER."
it is like buying a car. the sooner you pay it off the better. Nothing is wrong with an adjustable rate mortgage if you can afford to pay it off in a year. That first year or two has a set interest rate so if you can afford to pay it off in a year and it is lower interest rate that year than conventional why not?
The way those banks took sp many people OUUUUUUUT with those ARMs, should have been criminal!!
I’m the only person I know who ever had an ARM go down over the life of a 20 year mortgage. Buying a nearly 100 year old house in 1983, the bank required 20% down (no PMI) and interest rate adjustments every 5 years. Needless to say, interest rates were jacked in 1983, as I recall ours was about 12%. Every 5 years our mortgage payment decreased because fed rates kept dropping. Unbelievable!
Oh that’s cool
The Federal Reserve will drop interest rates to stimulate the economy. They raise it to control inflation (Quantitative Easing and Quantitative Tightening). There was sky-high inflation due to the late oil crises of that era (remember long gas lines and 55mph highway speed limit?).
Nope, happened after 2008.
Why did it take you so long to pay off the mortgage? No mortgage and no interest is always cheaper than having a mortgage especially 40 plus years ago
After 9/11 my adjustable dropped to nearly 0%, cut $1000/mo from the payment. But, that was an exception, of course.
Do I just keep waiting for a housing crash before buying, or should I shift my focus to the equity market? A 30-year fixed rate was only 5% this time last year, and mortgage rates are currently at their highest point in 24 years, since 2000, and inflation data suggests that they may continue to rise.
The stock market is no exception; maintaining a profit requires a thorough understanding of the market. I primarily just purchase and hold stocks, but for a long time now, my portfolio has been largely losing money. Unfortunately, you will need to remain consistent and often rearrange your portfolio in order to be able to generate good gains.
In my opinion, it was much easier investing back in the 80s but it’s a lot trickier now, those making consistent profit in these times are professionals reason I’ve been using an advisor for the past 5 years to consistently build my portfolio in preparations for retirement.
My partner’s been considering going the same route, could you share more info please on the advisor that guides you
Finding financial advisors like “Sharon Ann Meny” who can assist you shape your portfolio would be a very creative option. There will be difficult times ahead, and prudent personal money management will be essential to navigating them.
Thanks for sharing. I curiously searched for her full name and her website popped up immediately. I looked through her credentials and did my due diligence before contacting her.
His voice is very soothing
I agree😊
🙏🏾
Yes, very!!
It is 😊
In my state, we get our property tax bill in October. If escrow is short, which it Always will be in a 1st year new build, you have til December to pay the difference so the deficit doesn’t reflect in your mortgage. Our first year new build was only escrowed for $1,600. With the homestead exemption, we were short $1,100 in escrow. I researched and researched as much I could digest regarding new builds before we signed our contract, so fortunately we were able to plan and save up the difference and paid it. Our insurance went up but I shopped around and it increased $75 a year vs the initial $187 it would have been if we stuck w/ our initial insurer. We didn’t have a real estate agent and the buyers agent didn’t tell us squat about the initial property taxes on new builds. It’s up to the buyer to do their due diligence at the end of the day.
Yea there’s so much to know even the best buyer’s agent will miss things and we also learn daily
@@realestatesteph is the mortgage holder allowed to not ask you if you want to pay the difference in your escrow shortage? Or are they allowed to just send you a check with your little $40 that you’re over? Then at the first of the year when they do your escrow analysis, you can be really short.! when my bank does the yearly escrow analysis they never include an option to add money to your escrow account so that your payment doesn’t doesn’t increase. Does anybody know if this is legal?
It isn’t always just new builds. The first house I bought I knew they underestimated escrow for my taxes so I set aside money each month to cover it. However, the next year they went gang busters on over calculating for taxes. The whole situation was very frustrating.
Yes it's due to taxes on new construction and taxes. You don't pay the new rate on the first year and then you have to make up for it the second year.
it is the reassessed value that bite u in the butt later after one close on the property same thing happened to me but it worked out because i got my 50k homestead exemption so my payment actually went down 90 bucks a year
She definitely got an ARM which is why it went up so much. However if you buy a new build be aware that the 1st year's property tax is the land only, it will be reassessed the 2nd year and your taxes will SKYROCKET. For this reason, do as I did and pay like an extra $500/month that 1st year and fill up your escrow account so when that big hit happens, it's no big deal.
I sold all of my properties in 2022…. I bought a sailboat. It’s registered in Delaware…. No taxes😁
Been sailing the Caribbean for the past 2 years⛵️
Awesome!
Whenever you’re buying a new construction overfund your escrow by at least $2K - $3K. If you’re purchasing a new build in Texas, especially Harris County, the tax appraisals are conducted in March/April, and the tax bills go out beginning in October. If your home isn’t completed prior to the tax appraisal, your tax escrow due at closing will be based on the unimproved value of your property. This will cause your escrow to be underfunded, and you will be short on your tax payments. Your mortgage company will notify you of your escrow account being underfunded and give you some time to get the balance where it needs to be. If you don’t fix the shortfall within the allotted time your monthly note will go up to get escrow balance where it needs to be. Usually the escrow account has to have two months worth of taxes and homeowner’s insurance in it.
Good advice
That’s why it’s better to waive escrow if the bank allows it…
I always overfund my escrow in Md. and all these do is send me the overpayment back and then raise my mortgage anyway
Don’t take out an adjustable rate mortgage! Duhhhh…..
We all know this now .. it’s stories like hers that are the warning we all now heed
Yes--buy less than you can afford. The year I bought my first house, I was laid off and spent the next two years in flaky, shaky job situations. It was all I could do to scrape together a mortgage payment, buy groceries and keep the bills paid.
Fall on deaf ears. Buying what you can afford for many may result in a home in a less desirable location.
Truth: most of these people. COULD NOT afford the home they wanted. So they went “monthly payment” shopping. A fixed rate would have had the the home OBVIOUSLY unaffordable. People do the same with CAR LOANS, car leases, buying on a credit card and justifying the monthly cost.. if you can’t afford it…don’t buy it
She mentioned it went up over $5k in the last 7 yrs. That coincides with the HUGE interest rate increases AND home values that just exploded over since the pandemic. And of course - depending on where she lived - home insurance went up dramatically. Like you stated - it was a deadly cocktail. DECADES ago - many seniors were displaced out of Silicone Valley as they saw rental prices going up (rentals hitting $3k/mo) and property taxes going to $10k/yr. More than doubling - if you were on a fixed income, you had no choice to move out of the area.
Man that’s crazy! Talk about a horror story
Homestead is based on income in Ohio. Is it the same in other places?
I live in pa its based on the value of the house. Not incomr
@@ltgemini1599No, income doesn't matter in Texas. However, 65+, didabled vets, disabled persons have additional exemptions available.
Real Estate should not be a horror story, Real Estate needs to go back to the days when people who sold their homes and gave mortgages to the buyers. Once corporations meaning banks and appraisers with artificial values entered into the field that's when the corruption began.
Property tax is a scam, I purchased the house once
Agreeeeed!!!
It’s so there’s always a way to take it from you or take it from your family. The fact that HOA’s can conjure up some insane bill and take your home if you don’t pay it is also absurd.
Once you learn the law you will never be scared of property tax.
Yes, property tax is a scam, and I am ok with the yearly property tax as long as the school district is good. My issue is that they charge you property tax for over 30 year on the value of the house, but when it's time to sell, they will tax you on the profits.
Well, the people in Texas and Florida swear by it. Or at least, they used to, lol.
You offer a wealth of GREAT information with a delivery that allows that information to sink in.
We signed a purchase contract for a new build and put down $15,000 earnest money. Rates were around 2.5%. By the time the house was built and we could lock in, the rate was 6.125. Our payment went from an estimated $2800 to $4600.
We could have walked away and lost our $15,000. We felt stuck. We’ve been in two years now and have been hoping rates would go down, which they haven’t.
Do you regret choosing not to forfeit the $15000 and finding something more affordable?
@@FTYC2022I don’t know if I’d use the word “regret”; I think, knowing what I know now, I might have made different decisions…but there’s no way to go backwards. I still believe real estate is a good investment. However, I have now put my house on the market. I really love the house, but it’s much bigger than what we need, and I would rather have more disposable income, rather than paying the high mortgage payment every month.
$15k is a lot of money, but we would've had to walk away.
I have a fixed rate mortgage. Property taxes went up (my home’s fair market value) … and I’m paying ~124 more a month. I bought in 2021 and the new tax went into effect in 2024. I think it’ll be assessed again in 3 years. I will look into your suggestions… I am in NC. My fixed rate is 2.4%. I will not do anything to loose that 30 year rate.
I'm about to start doing content like this for insurance all because of how amazing this video is. I love your style
Thanks do it!!
Great video! Mine is fixed at 3%, 15yr (refinanced during pandemic), no PMI, and I pay extra toward the principal. If I had it to do over, I would not pick Collin County, TX. Lord help me! Be safe out there!😊
🙏🏾
I refinanced during the pandemic and was at a 2% We just bought a new house and I can’t wait to refinance into a lower rate. I know it’ll never be 2 again but love the house.
Banks here in the Netherlands take loan-to-value into account when offering an interest rate. I refinanced in ‘22, 10 years after I bought the place. Since my house appreciated in value quite a bit and I paid off part of the loan, they offered an attractive rate. I got 1.6% fixed for 20 years…. And when I buy a new house, I can probably move the mortgage to it.
I did a 15 yr at 1.8% during the plandemic. Extra monthly also! Good for you! Wishing you the best!
I live in NJ, and I was paying $2,345 a month and a year they increased to $3,570 a month. We almost lost the house because we didn’t have enough money to pay. Thanks to a program we got to pay the month behind and they lower the mortgage to $3,100 a month now.
The problem is New Jersey has people convinced It’s the only place you can live a good life and make good money. Yeah, you make good money, but you give it all to the state. I live in North Carolina. My house is 17 years old. My taxes are $1000 a year on a 2000 square-foot four bedroom house. You have to get out of the matrix. people are afraid to leave there. best decision I’ve ever made
2300 a month is too much let alone 3100. That’s sickening.
Ahh...New Jersey. I left New Jersey 9 years ago, moved to and bought a beachfront home in Central America. My annual property tax is $550.00.
I wouldn’t ever move to the South. I’d rather pay more and live somewhere else.
@@Starbeoghtuser3475 please explain why
Currently reviewing numbers for a new build & this information is spot on !!
🙏🏾
Hope it’s not a DR Horton build. So many videos on YT about the quality of homes they build. Do your research, hire your own Inspector, and hopefully it’s not in a HOA. Good luck. 😀
Fortunately, VA service-connected disabled veterans rated 100%, do not pay property tax robbery.
Well deserved thank you for the service and sacrifice
Depends on what state you are in
@@anthonyrodriguez2413 Fortunately Texas is one of those states.
Not true. Regulations and policies varies by state.
in north carolina we only receive a 50k off assessed value it helps but not exempt keep my property tax around a grand a year on a 240k house
Are they still doing ARMs? I thought they would have been banned after the 2008 debacle
I will shout from the highest mountain. Until the person has the deed in their hands. The lien holder should be responsible for the taxes. I know the deal breaker is the word mortgage . But I strongly feel that the person who actually hold the deed. SHOULD PAY THE TAXES.💁🏽💯
Lenders would just factor that into the loan and increase the interest rate.
@@justwait9822 ,
You are definitely right on that part💁🏽💯
Would be great
@@realestatesteph but no seller would ever do that on lease to own which I think is what his post is referring to. New subscribers. I like how you speak so clearly and with really HELPFUL information for the average home buyer.
@@justwait9822That can happen, but then the lien holder will charge you, so you will pay anyway.
Great Video! I’m a former escrow officer/ mortgage underwriter and you explained this information Perfectly!!! 💯💯💯👊🏾🥂
As a CPA , i appreciate the fiscal honesty in this video. 🤗
If my choice was an adjustable rate mortgage or renting…I would have kept renting…
Ok what if it started super affordable and the end rate would still be affordable? Because those exist!
@@realestatesteph can you show me an example of that ?
@@realestatesteph Wouldn't give a damn, adjustable rate = getting slammed no lube.
If I budget, I'll have extra but I'll take a fixed at 5 percent a year over an adjustable that starts at 2 percent, then up to 5 percent and than higher.
Ive never seen one go back down to its lowest price.
Ive only ever seen people suffer or falter and lose their homes using the adjustable.
I'll be damned- not touch it ever and teaching my kids not to touch that with a 10 foot pole.
I'll be sleeping in my car till I can earn enough cash to buy with no loan or mortgage.
The fact that loans and mortgages are normal- it shouldn't be
Mortgages and loans are SCAMS. If you can't pay cash- you shouldn't buy the home.
My car- cash
My college- cash
My trade school- cash
Loans and mortgages are SCAMS. They force you to have homeowners insurance, increases taxes- increase payments due to loan rates.
Suffered 3-4 years using a planet fitness card to shower, live in your car so one day you can live in your own home .
Don't even try me with that "it's impossible"
I'm doing it- and even in this economy, I'm making it possible cause I'm willing to Suffer now to avoid suffering later 💯
Pmi can be dropped before 2 years. I got mine dropped shortly after the first year. I did improvements on my house and then got it appraised. Sent the appraisal to my mortgage company. You have to call your mortgage co. First to tell them you want to remove pmi, they’ll tell you which department has to receive the appraisal. If you get the place appraised high enough, pmi gets dropped.
Mmmmmmmm interesting I’ve never seen that as an option. What loan type?
What improvements did you do?
That's what I am planning on doing on top of paying another rack on to the principal each month to get my pmi off. I have been in the home for about a year now and I know the value went up since then. My monthly payment went down 300 dollars after 6 months, and I had no idea why. Long story short, the home hadn't been reassessed since the owner paid 100,000 dollars for it 20 years ago lol but it did go back to the balance I was paying before it dropped 300 dollars so that was okay. But it did cause me to have a shortage on my escrow 😖 I plan on paying my house off in 12 years and not 30. I don't want to have to worry about pmi and insurance my whole life
Definitely sounds like a conventional loan. I believe with an FHA you have to refinance as well.
@@zaofactor yup, that's a conventional loan. That's why I tell people to avoid FHA. It adds undue stress vs a conventional loan in more ways than one
Great video and thank you so much. I’ve been in my condo about 20 years and never really understood homestead for taxes. I was just told to make sure I applied for it and I did, but never really understood it. You explained it perfectly.
Thanks! I’m gonna do a whole video on how these darn taxes work and how to save!
I live happily ever after in my spacious one bedroom apartment, with new appliances, free swimming, free gym, free office space, free parking. When something breaks I pick up the phone and someone else fixes or replaces it for free in a couple of days.
If you like it I love it
@@realestatesteph I love it!
And not house poor 👍
Not free
@@dcg590 you must be defending your house poor status.
yeah it happened to my brother! he bought an arm his pmt went from 1,800 to 5,000 whenever i asked him anything he just did not want to discuss it with me - so i just backed off!! 3yrs later he lost it - tried to sell it but couldn't by the time he came to me for help - it was too late!!!
The problem is not just adjustable rates, its also the mortgage company and taxes..if your escrow is off
Years ago I tried getting rid of my PMI when I reached that 80/20 mark. The bank refused to drop it and said I had to prove it by having my house appraised at MY expense. I eventually switched to another bank and the original bank lost my business
In Texas don't forget MUD taxes too if you live in suburb. Be prepared for that as well in addition to property taxes. Your MLO should have sat down with you & discussed your estimated monthly payment, estimated MUD tax rate, etc. I applied for the homestead exemption 2 weeks after closing, keep your escrow overfunded jic. Good luck! Thanks for the video😊.
As someone who's been in a mortgage industry since 1989, and actually a licensed insurance agent since 2010, there's some truth in the fact that she was paying taxes on unapproved land. But she also probably got a buy down on her rate from the builder, that was only meant to last a year, and maybe her insurance went up. But $5000 jumpedis typically unheard of there's more to the story. Additional issue may be that she did not file for her homestead exemption, which caps your taxes. Secondly, the reason some builders only used the taxes for the unapproved land is so that they can qualify the buyer on the lower tax rate. Debt to income ratio.
You can dispute a tax increase by simply having a real estate agent supply you with comps in your area. Home prices are now falling so your request is justified.
This is true everyone’s taxes where I am should be falling
Yeah I agree. The lady in the beginning clearly purchased a very large house but asked for adjustable rate. It had to be that. Because homestead exemption would not allow the taxes to go up that much in 5 years. She might be trying to hide how rich she is and maybe has more than one house and didn't have homestead exemption if she truly had that large of a tax increase.
It was today (12/30/2024), that I came across this video. It’s crazy to think that I only started the video because I found the guy attractive, and wanted to hear his voice for a moment lol. Upon observation, I did indeed listen to his message regarding essential tips and tricks, and Steph is absolutely correct. Without going into the nitty gritty, he conveyed everything a beginner would need to know and be aware of, and everyone else who may be a bit more experienced. I’ve learned a few things from him today, and I’ve already purchased two homes. Take heed, y’all!
Purchased a new build a few years ago, and that is exactly what happens. They tax the value of the land when you build - so you get a tax break the first year, but the city can assess the value every year. Now I pay 16k a year for my house. It’s out of control.
In Texas?
@@realestatesteph yep!! It’s crazy here. I can’t even afford to live in my own house.
This was an adjustable rate mortgage issue not a tax issue. Always get a fixed 30 year mortgage and work to pay it off early.
Do bi-monthly payments and add an extra month's payment amortized over the year. A 30-year mortgage can be reduced by almost 1/3. Not only is the mortgage paid sooner, but you save a ton in interest without needing to be shackled to a 15-year note payment.
Great conversation. I wished you talked more about upgrading your home in this video over going to schools and buying cars.
Interesting thought I’ll consider it
It tells you in your promissory note about your ARM. Usually it’s adjusted to the current prime rate at that given time plus another percentage. 😮
Really well put together video. Super comprehensive.
I agree with you regarding the "Adjustable Rate Mortgage " and during my buying any of my new homes ,I always secured a conventional 30 year mortgage ,with a large down payment .
I also drive a 1999 used Mercury car that I purchased 1n 2008 with 70,000 miles on it and I am still driving that car.
My mortgage payment has gone up by over $1k a month due to insurance increases. I’m paying 5x as much for insurance now vs when I bought it
Dang! It’s time to switch!
Insurance is hitting everyone
@realestatesteph Almost impossible in Louisiana. Most companies are not writing new policies.
Are you in Florida? It’s so hard to get insurance here now and it’s incredibly expensive.
@@livingthedream923 yes, Florida
I also have my taxes included in my house note in an impound account .
This man needs more subs and likes and comments!!! Content he’s bringing is real
Appreciate it! We’re building!
ARM's are very dangerous. Been there, done that.
Laughs in California resident. My home owners insurance increased (by a lot) as did my car insurance. I have my car bundled with my homeowners policy. I called around to get better rates for both. While I could find car insurance at a slightly cheaper rate, those companies were no longer underwriting homeowners policies in California. Mind you, I live absolutely nowhere near a fire or flood zone, and having separate policies wasn't going to save me any money. So I'm stuck with Farmers for now. I may have lucked out big time with my 2.85% refi, but now my insurance costs wiped all of that away, leaving me with a higher mortgage. Oh, that and my property taxes increased also 😢
Dang! I’m sorry to hear that!
It’s all there laid out in black and white when you sign.
Paused out of this video… Thanks for the encouragement Brother! Just Lowered property insurance!!! Yippee! Thanks for the push to make that call. Got a $365 check coming! 🙏🏾❤️ Now back to the video! You know I’m subbing right?!!! Thank you! 🙏🏾❤️
That’s the dopest thing I’ve heard all year. Thanks for sharing that.
You might want to check, in NY state PMI doesn't drop off even if home value has risen. It only drops off after you have paid 20 percent of purchase price. Doesn't matter that your homes value has tripled.
That’s crazy. I’m positive it works that way here but the burden of proof it on the owner and it has to have been 2 years
All this is true but it’s only symptoms. The true cause are houses have become financialized. Instead of a home to live in. Since this is the case “they” banks, government, insurance get you either way.
Very true
Yeah , but what’s also changed is the size of the houses people think they need . When I was growing up we shared bed rooms and had one bath ! Now young people want a home that’s the size of most people’s dream home ( in the past ) . There used to be a starter home , now the younger generation wants a a luxury home . Well banks and builders saw this and built for it which drove up the “ average home” price , because the “ average” home is no longer even remotely what the “ average “ home used to be
I want to bulid a barn/shop in north Texas....is the sqft of the barn the same property tax rate as my dwelling?
Such and informative and well presented video. Thanks for the advice! New subscriber here! 👍🏾
Welcome! We try and give good advice without scaring the crap out of ppl over here!
Between the increase in the homestead exemption to $100k in Texas, being diligent in shopping my insurance every year, an maximizing the credit score factors that go into insurance scores, my monthly mortgage payment is lower this year than it has been in any previous year, despite the increase in property value.
Texas allows insurance companies to factor in credit scores when determining insurance rates, but there isn't actually a way to find out what your insurance credit scores are, and information on the scoring factors is sparse.
You can have decent credit per FICO, but still be paying double what you should for insurance due to your insurance credit scores, and never know why!
My homestead tax cap is 4% in Maryland. I'm gasping at 10% lol
Ive been in my place since 2018 and I realized this year that I need to shop around for a new homeowners insurance company.
I know these property taxes are nuts!
A good Real Estate Agent should tell you. Mine did and she made sure at closing the money for first year taxes were in escrow. I'm a disabled veteran and don't pay taxes but the first year, I did on a new build.
I live in Texas and after that big freeze in 2021 my water pipes frize and they kept turning the electric off and when they turned it back on there was an absolutely gigantic power surge that fried my wiring. My insurance company refused the water because they said the dsmage was not from water but was caused by perspiration and refused coverage. On the electric they said it was not an act of God, that it was man-made (the electric company) and so not covered. Then they cancelled my insurance. I've been told it could cost as much as $25,000 to rewire my house. Mow I live in a house with no water and only partial electricity. The appraisal district says my small house built during WW II is woth a quarter of a million (it most definitely is not). I am 74 on social security.
So, I tried that in Northern VA and the Morgage company ran it off of my original appraisal and not today's value, so I had to pay to have an appraisal done of $200.00 and that worked got rid of the 84.88 PMI.
ARM is just a bad mortgage financing strategy. The 'new' rate will creep up on borrowers. So many people lost homes in my community.
Great video brother you know your shit ❤ could she apply for a homestead to get a tax exemption ?
I didnt watch the video but this is more than likely taxes and adjustable rate mortgage usually 15 year mortgage. Never get these unless you plan on selling quickly
Taxes, title and insurance is usually included
I got a 5/5 ARM in 2014 at 2.75% with 20% down. Paid down principle incase things went sideways. Rate adjusted to 4% in 2019 which was the max(could only increase 1.25% every 5 years). Secured a fixed 10 year loan in 2021 for 2.375%
What's wrong with a fixed mortgage?
Morning maybe I misspoke .. Fixed mortgage is good.. Adjustable rate is not always so good
Why would someone go for an adjustable rate mortgage 🤔
Thank you, this was so helpful!
Oh great that’s what I love to hear. I’m so glad you found it helpful.
She bought a five bedroom house and was paying only $2,500/month? Higher property taxes are an issue when you buy an older house that's appreciated a lot in value as your property valuation will jump and then your property taxes will later on. Our property taxes have gone up about 350% since the late 1980s. Is that a big deal? Increases were slow and incremental.
Very informative
Needed to find this channel
Always go fixed rate then refinance when the rate goes down. It’s more work on your part but it’s the smart thing to do.
I wish more people knew about the taxes when building a new house and I wish someone would tell them!
I made the adjustable rate mortgage trap back in the late '70's. That & the Condo fees going up up up, just killed me until I sold, thankfully. Never again. I get a fixed rate.
Fixed rate loan will not change . Other factors can such as taxes, insurance. But that original mortgage portion will not.
My mortgage went down $80 and got a $1400 escrow check back apparently i was paying to much into escrow. My porpety taxes went up and i kick my insurance out the door and got $1000 cheaper insurance.
Nice! I just got a check back as well
I had a friend that did the dumb thing and got an adjustable rate where he could basically buy way more house than he can afford so his payment started out at like 1500. They balloon to 8500. He ended up losing the house and all the money he put down such a bad mistake.
Daaaaang
Vital information for first time homebuyers in Florida
Been in my house for 14 years now and have had a escrow shortage 12 of those years based on property values going up. Should have definitely filed homestead early instead of 6yrs in. Honestly I would have done a lot differently if I was able to do it over again.
Curious to know what all you would have done differently
@@realestatesteph Filed homestead year one, made extra payments to pay of home early, and refinanced when interest rates were super low.
We paid off our house. But our property taxes and insurance keeps going up.
Yup that’s the story
Nover buy with a ARM loan. Always a fixed rate, and keep a close eye on your escrow account. If you have a $2000 payment put $1000 into your escrow in Nov before they compute your payments and it will drop your future payments. If you have extra money always put into the principal, even if it's $50 straight to principal. If you know your insurance went up pay upfront depositing to escrow account
Solid advice💯
Thanks! I’m trying to help
Very informative!!
🙏🏾
I enjoyed this video. You gave some great solid advice!
Glad it was helpful!
30 year fixed rate. Or unless she got a 10 years no tax abatement. Mortgage insurance and property taxes go up.
It was an adjustable rate mortgage
@@realestatestephpeople definitely fall for the adjustable rates they will get you every time with the balloon 🎈
Why do they even have adjustable rate mortgages, and what is the advantage of doing an adjustable rate mortgage.
Short term equity gain that’s about it. It’s gambling bc you don’t ever know what the market will do!
New subscriber here, very nice video, and thanks for sharing.
How many years back can I go back when filing a homestead in Texas?
No backfilling
I have a fixed rate on my mortgage of 3.25%! I just got my insurance bill, and it went up with up about 300 per year!
Gotta shop around!