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February 18, 2010     Tri-County News
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February 18, 2010
 

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Page 14 lCeal Estate AFFORDING THE DREAM Homeownership shouldn&apos;t be a financial nightmare By Chelle Cordero Creators News Service Often called "the American dream," home ownership has been both a source of satisfaction and consternation for many. Potential buyers wish for financial rewards on their investment along with the pride of owning property. When the math works, the investment does too - but when it's off, the losses can be signifi- cant. Finding the ideal place and being able to afford it can be a challenge. "Buying a home is the single largest financial decision most will ever make. The important thing is to slow down and fully understand the ramifications of your decision to short term cash flow needs as well as being mindful of long-term retirement planning," said Dave Muti, a senior mortgage planner, registered mortgage advisor and author in Parsippany, NJ. "You should start with a mortgage plan- ner to determine your actual buy- ing power and set a plan in motion. Then you go out and shop for a home that is no more than three times your household income, which should ensure that your debt-to-income ratio is below 28." In the past, affordability was tricky. "Banks typically require 20 percent down .... The problem is that as homes became more expensive, it became unrealistic for some to come up with that type of cash," said Eric Witczak, senior vice president and retail banking manager at Nicolet National Bank in Wisconsin. Today, prices are going down - however, don't settle for just any mortgage. "The zero [or little] down programs most often result in higher rates and higher fees," he cautioned. "The fees will more than likely be added to the mort- gage. This, in turn, makes it nearly impossible to gain any equity, and often results in negative equity." Due to the current housing cri- sis, there is less opportunity to put small down payments on a pur- chase. "You are better off continu- ing to rent rather than purchase a home if you have less than five per- cent down," said Witczak. "Lend- ers look more favorably on lending people money when they have real equity into the collateral. A person is more likely to make their pay- ments when they have real money invested. "Living within our means, and having real equity in our assets will take us a long way during tough economic times. I'm all for home ownership, but I also believe that renting is a great alternative until you've built up a nest egg for a down payment. It will save you thousands of dollars in the long run." While there are substantial pluses to owning; experts in the field: of real estate and mortgag- ing agree that education is crucial. After determining the type of place that interests you, investigate what it is worth in the neighborhoods you would consider by comparing the home to other recent sales. Learn what your closing costs will be beyond the sale price -this can include inspections, title insurance and recording fees. In addition to moving expenses and property insurance, be prepared for maintenance and any other modifications you may need to make before living in the house; this is critical in an older home, where repairs might also be nec- essary. No matter what, you should determine what you can afford. "Before you even walk into an open house, call when passing a 'for sale' sign or contact a real- tor, call a reputable mortgage bro- ker," said Janice B. Leis, associate broker with Prudential in Penn- sylvania, Florida, and New Jer- sey. "They will run credit. All my clients are told to submit all doc- umentation, such as tax returns, w-9s, 1099s, whatever is neces- sary. They will tell you exactly what you can afford, how to keep your status clean and substantial and what exactly is needed finan- cially with down monies and clos- ing costs. Listen carefully and all will be well." 2009 CREATORS NEWS SERVICE Thursday, February 18, 2010 Tri-County News Kimb, MN ............................... iiiiii!iii Making your home senior-friendly (StatePoint) With more older Americans remaining in their homes as they age, it's important for their houses to be equipped to deal with their changing needs. The number of Americans age 65 and over will reach more than 70 million within the next 20 years, with almost all Baby Boom- ers (90 percent) hoping to live in their current home for as long as possible, according to statistics from the Delaware Valley Regional Planning Commission and AARE "With Boomers leading this trend of 'aging in place,' they are realizing home modifications are essential to maintain independence as they age," says Eric McRoberts, incom- ing chair of the American Institute of Architects' (AIA) Committee on Design forAging. The AIA recommends Boomers make their homes and communi- ties safe and navigable - despite age or physical ability- by follow- ing four steps: Clear your paths Remove clutter that can obstruct your home's pathways, such as plants, magazine racks and small home accessories. If one of the home's residents uses a walker or wheelchair, allow at least 36 inches between objects. Make sure to have lots of light to ease strain on older eyes and install wall switches at all room entry points. Adopt universal design Small adjustments and basic retrofits can transform first or ground floors into everything-a person needs - namely, a bed- room, bathroom and kitchen. Uni- versally designed rooms feature elements such as dropped coun- tertops, grab bars, level door han- dles, step-less entryways, wide hallways and curbless showers for safety and accessibility. In multi-level homes, upstairs rooms are often converted into guest bedrooms or hobby areas that are seldom used. Using this rightsizing concept, McRob- erts says, "An architect can help homeowners craft their physical environment so it's increasingly friendly to them as they age." Prepare your community The record number of Americans expected to retire in the coming years, combined with their desire to stay in their homes, will result in sweeping changes to their houses as well as their communities. The con- cept of livable communities- areas containing cultural, civic and sport- ing activities connected by public transportation- is expected to gain momentum. Boomers who lobby local leaders today for community friendly pub- lic bus systems, accessible parks and pedestrian friendly walkways will help themselves and others in the future. "If Baby Boomers make senior-focused programs and initia- tives a priority now, it will be a win- win, not just for their golden years, but for the entire community," says McRoberts. To find an architect to help you and others in your community implement senior friendly ideas, visit <http://architectfinder.aia. org>. LAKE ; ' " . 4 I 3531 CO. RD. 3 N.W., ANNANDALE, MN 320-274-8497 OR 320-286-2560 www.frenchlakeautoparts.com OPEN: TUES.-FRI. 8-5; SAT. 8-1; CLOSED SUN. & MON. ve$, we fake... Cars & Trucks Lawn Mowers Docks Nut/Bolts/Nails Bicycles Washers & Dryers Fence Posts Farm Equip. Car Parts Stoves Tin Old Trailers Old Sinks Miscellaneous Pipe/Iron Pieces Old Car/Truck Rims Fenders/Hoods/Etc. Pick-Up Toppers. Water Heaters If it's METAL and in your way, we will be glad to take it. We not only take Autos & Trucks, we will take a trunk load to a semi-load of scrap. Look through the list to see if we accept what you have. If it's NOT listed, CALL to see if we can help you dispose of it properly. NKE FOl