Archive | May, 2014

View from the Top in the Re/Max Balloon and 7 Financial Benefits of Home Ownership

9 May

I’ll help you buy or sell your home in Louisville, KY. If you’re looking to buy a home, I’ll help you pick the right home for you. If you’re thinking about selling, call me and I’ll tell you what price you home is most likely to sell for. Click here to search a available homes on my website.

The 7 Financial Benefits of Home Ownership This Tax Season

The financial benefits of home ownership are evident year round, but particularly around tax time – they seem to jump off the page. Let’s examine how home ownership makes “cents” –  from the tax benefits, to good old fashioned financial stability.

1. Home ownership Builds Wealth Over Time

We were always taught growing up that owning a home is a financially savvy move. Our parents knew it, and their parents knew it. But this past decade of real estate turbulence has shaken everyone’s confidence in home ownership. That is why it’s so important that we discuss this again now that we’re in a ‘new market.’ Home ownership can be a very savvy financial move – but only if people buy homes they can actually afford. In 2014, this idea of sticking to a home you can afford to gradually build wealth is a “rule” that just happens to be new and old at the same time.

2. You Build Equity Every Month

Your equity in your home is the amount of money you can sell it for minus what you still owe on it. Every month you make a mortgage payment, and every month a portion of what you pay reduces the amount you owe.  That reduction of your mortgage every month increases your equity. That is especially true now with the elimination of risky mortgages like negative amortized and interest-only loans – thanks to the new “Qualified Mortgage” rules. The way mortgages work is that the principal portion of your payment increases slightly every month year after year. It’s lowest on your first payment and highest on your last payment. Thus, as the months and years go by, your equity grows!

3. You Reap Mortgage Tax Deduction Benefits

  • Mortgage deduction: The tax code allows homeowners to deduct the mortgage interest from their tax obligations. For many people this is a huge deduction, since interest payments can be the largest component of your mortgage payment in the early years of owning a home.
  • Some closing cost deductions: The first year you buy your home, you are able to claim the points (also called origination fees) on your loan, no matter whether they are paid by you or the seller. And because origination fees of 1 percent or more are common, the savings are considerable.
  • Property tax is deductible: Real estate property taxes paid on your primary residence and a vacation home are fully deductible for income tax purposes.

4. Tax Deductions on Home Equity Lines

In addition to your mortgage interest, you can deduct the interest you pay on a home equity loan (or line of credit). This allows you to shift your credit card debts to your home equity loan, pay a lower interest rate than the horrendously exorbitant credit card interest rates, and get a deduction on the interest as well.

5. You Get a Capital Gains Exclusion

If you buy a home to live in as your primary residence for more than two years then you will qualify. When you sell, you can keep profits up to $250,000 if you are single, or $500,000 if you are married, and not owe any capital gains taxes. Now, it may sound ridiculous that your house could be worth more than when you purchased it after these past several years of falling house prices. However, if you purchased your home any time prior to 2003, chances are it has appreciated in value and this tax benefit will come in very handy.

6. A Mortgage Is Like a Forced Savings Plan

Paying that mortgage every month and reducing the amount of your principal is like a forced savings plan. Each month you are building up more valuable equity in your home. In a sense, you are being forced to save—and that’s a good thing.

7. Long Term, Buying Is Cheaper than Renting

In the first few years, it may be cheaper to rent. But over time, as the interest portion of your mortgage payment decreases, the interest that you pay will eventually be lower than the rent you would have been paying. But more importantly, you are not throwing away all that money on rent. You gotta live someplace, so instead of paying off your landlord’s home or building, pay off your own!

As always, you must look very hard at your personal situation before making the big decision to buy.

Hopefully this information has been helpful to you. If you have any further questions please do not hesitate to contact me. I would be happy to further explain the benefits of home ownership to you.

If you’re looking to buy or sell real estate in Louisville, you can reach me via phone or email for assistance.


Todd Martin Reviewed by Carolyn Hardy

7 May


(I was on the market to buy a home and my mortgage broker at my local bank put me in contact with Todd Martin. I am so grateful for the referral! There was nothing that Todd didn’t do for us. He definitely help us talk down the seller and he also made sure that they covered the closings costs. He even made sure they performed all of the repairs we requested! It was awesome! Todd is very knowledgeable and I have confidence in his skill and his trustworthiness. I never felt like he needed to rush away, he could spend as much time with me as I needed him to. He was extremely organized and was always ahead of my needs. There was one instance that really impressed me where he originally was going to be out of town at a conference during my closing but at the time of closing, he just showed up. He was able to book an earlier flight and even came in jeans to make sure he was there for me. He was there himself and I really appreciated that. When you work with Todd Martin, you will be confident in him and he’ll guide you in the right direction. I wouldn’t work with anyone else!)

Todd Martin Real Estate Agent RE/MAX Metro 1829 Bardstown Rd. Louisville, KY 40205 Call – (502) 220-4663