Mortgage

Lakeland Real Estate 101 – Escrow Accounts Defined

One of the things I love most about my job as a Lakeland real estate professional is that I get to educate my buyers about the real estate purchasing process.  With a doubt, a term that is often not very well understood by new Lakeland home buyers is the term Escrow Account.  So, I’ve written down a brief overview for you here.

An escrow account is a specially designated savings account into which funds are deposited for a defined purpose.

With respect to Lakeland real estate and mortgages, your escrow account is used to hold money in a neutral account prior to closing, and later to pay real estate tax bills and homeowners insurance payments.

Once your mortgage is in effect, escrow accounts are managed and disbursed by lenders or their designated servicing companies.

Say you opt for an FHA mortgage.  This type of home loan will require you to “escrow” your scheduled monthly home owners insurance (hazard insurance) as well as a set amount for your property taxes.  The lender basically wants to be sure that you will be able to cover these bills when they come due.  When the time does come for them to be paid, your lender cuts a check to each entity from your escrow account.  You will not pay these bills directly.

Lakeland Veterans – Consider a VA Mortgage to Fund Your Lakeland Real Estate Purchase

One of the things I like most about living in the Lakeland area is the activity among our local veterans.  My husband and I met in Germany during the time he was stationed there, and his status as a US Veteran is one that is near and dear to my heart.

One of the many benefits we’ve enjoyed as a result of his service to our nation was the Lakeland VA home loan we took out to purchase our current home here in town.  Even during the highs and lows of the mortgage market over the past several years, I still feel that the deal we got as US Veteran home loan applicants ranks as one of the best out there.

Why Get a Lakeland VA Home Loan?

VA home loans are an excellent choice for any eligible veteran interested in buying Lakeland real estate, and surprisingly, only about 10 percent of US veterans take advantage of them.

In our present economic environment, where it’s becoming more and more difficult to get home financing, a Lakeland VA mortgage loan offers a good alternative.   VA loans don’t require a down payment, which is rare among mortgages today.  Even FHA home loans require borrowers to come up with 3.5 percent down.  So, using the VA home loan option can really help veterans purchase a home large enough for their family – one that they might be unable to afford with a conventional mortgage.

Lakeland VA home loans do not carry any prepayment penalties – so you can pay the mortgage down as quickly as you like.  They also have more relaxed requirements for qualification.  If you’re a veteran who is interested in buying a home in the Lakeland area, then you should look into applying for this loan option.

Who Qualifies for a VA Mortgage?

If you’re active in the military, or are presently retired, you qualify!   To get approved for a Lakeland VA home loan, simply contact a Florida VA mortgage provider. He or she will provide you with answers to any questions you have, and they’ll streamline your application process by handling all of the red tape for you.  You know that stuff well, I’m sure, from your time in the military.

If the purchase of a piece of Lakeland real estate is in your future, consider a VA home loan as your funding option.  Our country owes its veterans a great debt, and Lakeland VA mortgages represent one way you, as a US veteran, can be rewarded for your honorable service.

Lakeland Real Estate Update: You Now Have Only 6 Weeks to Bank the First Time Home Buyer Tax Credit

Lakeland real estate buyers or those contemplating buying a Lakeland home take note:

If you’re planning on taking advantage of the existing $8,000 First-Time Home Buyer Tax Credit program, you should buy within the next six weeks.

The program expires November 30, 2009, and since closing on a Lakeland home can take up to 60 days – you may miss the mark if you wait too much longer to sing a home purchase contract.

By my calculations, you have about 6 weeks left before you miss the Tax Credit window.

The First-Time Homebuyer Tax Credit – A Short History

The First-Time Homebuyer Tax Credit program was passed as part of the 2009 economic stimulus plan. It credits up to $8,000 in tax payments to qualified buyers.

Lakeland real estate buyers must meet the following criteria to qualify:

• You must not have owned a “main home” in the past 36 months
• Your Lakeland home may not be purchased from a parent, spouse, or child
• Your adjusted gross income (AGI) for your total household must be below $95,000 for single tax filers and $170,000 for joint tax filers

Additionally, you may not qualify for the entire tax credit.  This is because the credit can’t exceed 10 percent of your selected home’s purchase price.  Homes with income approaching program limits get lesser benefits, too.

Figuring What You’ll Get Back via the Tax Credit

Know that the First-Time Homebuyer Tax Credit represents a true tax credit and not a deduction.

So, if you qualify for the whole $8,000 credit and have a standard tax liability of say, $5,000 – you’d receive back $5,000 or whatever had been withheld for federal income taxes plus an additional $3,000 from Uncle Sam when your tax return is processed by the IRS.

Review the program’s criteria as your time permits, but don’t sit on the fence too long.  If you can’t close on your Lakeland home by November 30, 2009, you won’t qualify for the tax credit.

Better to be ahead of the deadline than chasing it.