LET TIME BE THE FRIEND WHO PROSPERS YOU—LOWER YOUR PROPERTY TAXES & INTEREST COSTS

Highlights from today’s podcast:

Market News

Look Back Memphis Trivia Contest

QUESTIONS ANSWERED BY TOM KING:

How do we take steps to lower our property taxes?

What is the timeline for lowering our property taxes?

What is the difference between a commercial property appeal and a residential property appeal?

Why is your pricing talked about as a no-way-to-lose investment?

What sets you apart from other tax appeal professionals?

QUESTIONS ANSWERED BY JO GARNER:

A lot of people are skittish of an adjustable rate mortgage after the real estate crash. How do you use them today with clients?

How can you use adjustable mortgage rates to lower overall interest costs today?

REAL ESTATE TIP OF THE WEEK

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Good morning, Memphis! Good morning across the country on IHEART radio. You’re on the Real Estate Mortgage Shoppe program. I’m your host, Jo Garner, Mortgage Professional with Evolve Bank and Trust. Always back by popular demand we have Tom King, Shelby County certified real estate property tax appeal expert, in the studio with us. Tom, tell some of our new listeners what you do and how you can help them.

Today we want to hear from you on the air. Our general topic is LET TIME BE A FRIEND THAT PROSPERS YOU– LOWER YOUR PROPERTY TAXES & INTEREST COSTS

If you have a real estate related problem, a real estate related question or comment or maybe you have a short story you want to share that may help someone else, give us a call today on the air at 902 535-WREC. (901) 535-9732.

(Jo) At the end of the year 2013 rates spiked up fairly high around 4.625% on the conventional 30 yr, dropped back down a little in January and February and then headed upward in March finally starting to come down again in May to a 1 year low. This past week turns out to have been the culmination of a short term trend higher in rates, beginning in late May even though the price on mortgage rates eased down a little late yesterday afternoon. Since there is no way to truly predict where rates are going, if you’re thinking about refinancing a house or purchasing one, here’s my advice—IF THE DEAL WORKS FOR YOU TODAY, DO IT TODAY. 30YR FIXED – 4.25%
FHA/VA – 3.75%
15 YEAR FIXED – 3.375%
5 YEAR ARMS – 3.0-3.50% depending on the lender

Tom, what are YOU seeing in the real estate marketplace right now

(Jo) Winners in the market this week were, again, homeowners who thought they missed the refinance opportunity but now that rates have dropped again, they are grabbing the opportunity. Some of these homeowners had tried to refinance a year or more ago but their property value was much lower, preventing them from being able to refinance. Others had some credit challenges. Don’t miss an opportunity to lower your mortgage interest cost. Lower the rate can save you thousands of dollars. Lowering the rate AND shortening the term of your mortgage can save you TENS of thousands of dollars. My very experienced assistant, Susan Belew and I even have some loan products that will not even require an appraisal value.

Susan and I are working with a couple who wants to retire. Due to some hardships, they racked up $55 thousand dollars in credit card debt plus they already had a mortgage of around $135 thousand dollars. With credit card rates in the double digits, the interest was just about to eat them alive. They had quite a bit of equity in the house they own, so we did a cash out refinance, paying off the mortgage of $135 thousand plus adding in $55,000 in credit card balances and reducing their overall interest about 10

percentage points on the credit cards we were paying off. They took a 30 yr fixed rate mortgage saving them about $1,350 per month in payments. They are able to prepay the principal on the new mortgage by about $1,300 per month getting rid of the entire mortgage in about 10 years which is a lot faster than they could have paid off all of that debt—even if they COULD have paid it all off EVER. THAT is the power of reducing interest. This one refinance is saving that couple of HUNDRED thousand in total payments using this plan.

(Jo) Tom, as we’re talking about the market and the people who are really winning in it right now—I just finished sharing how a customer of mine structured a debt consolidation loan that saved them well over $100 thousand dollars in interest. Yesterday I attended a closing with a first-time homebuyer customer of mine. He and his wife and children closed on their first home in a neighborhood where rents were around $900/ per month to $1,000/mo. Want to know how much his total payment was including taxes and insurance and mortgage insurance? $747/mo –a couple of hundred less a month for the house payment compared to what they would pay in rent. PLUS he may even be able to write off the interest paid to shelter his income on his tax return. That’s what I call a winner in the marketplace. A family with bragging rights!

If you have a real estate success story you want to share –or if you need one right now –call us on the air at (901) 535-WREC (901) 535-9732. If you’d like to talk with my experienced assistant or with me more directly, call us at (901) 482-0354 or catch us on my blog at www.MortgageLoansBlog.com. Tell us what you want to accomplish from your home purchase or refinance. Susan and I will go to work crunching the numbers for you to see how fast we can get you to your goals. Once you’ve told us what you want to achieve on the financing, she and I work up the numbers for you to compare. It only takes about 8 minutes on the phone to complete the loan application. Or you can go online and give it to use at www.MoneyShoppe.NET. That’s www.MoneyShoppe.NET or Susan and I can get the information in person from you or on the phone. We try to get the preapproval letters completed and delivered to you within less than 24 hours or sooner if you absolutely need it sooner.

Our general topic today is LET TIME BE A FRIEND THAT PROSPERS YOU– LOWER YOUR PROPERTY TAXES & INTEREST COSTS We’ve been talking about how to save tens of thousands of dollars on a regular mortgage deal. Tom King is an appraiser and certified Shelby County Property Tax Appeal Expert with King and Vaughan Consulting. How do we save money on our real estate property taxes?

2ND SEGMENT 9:18 AM It’s time for the Look Back Memphis Trivia Contest brought to you by notable Memphis historian Jimmy Ogle. Jimmy Ogle gives free walking tours in Downtown Memphis during the Spring and Autumn. For information about Jimmy Ogle and his schedule for the historic walking tours, go to jimmyogle.com. Our Look Back Memphis Trivia Contest SPONSOR is Marlene Foster of ADT Security Services—the number one security system. Give Marlene a call at 901 232-6277. She will take good care of you Marlene is giving away a $25 gift card to the first person who calls with the correct answer to our Trivia Contest. If you know the answer, call us on the air at (901) 535 WREC. (901) 535 9732.

Here’s our trivia question : Who am I? (go to hints)

Garner # 18 06/11/14

Sherwood Forest

Question:

Hint: I was part of the Post-WW2 suburban sprawl of neighborhood development in the 1940s.

Hint: I draw my name from a “royal” forest in a foreign country!

Hint: I develop near the largest general veterans’ hospital in America during WW2.

Last Hint: I do not “steal from the rich, and give to the poor”!

Answer: Sherwood Forest. Sherwood Forest is bounded on the north by Park Avenue, east by Getwell, south by Rhodes Avenue and west by Highland, Radford & Prescott. Most of the dwellings are single family homes were built between 1940-1955, in minimal traditional, Colonial revival, Tudor revival or ranch-style architecture. The area was originally developed by William Chandler without sidewalks, curbs or underground drainage, but some sidewalks were added after the 1950 annexation. Major influences on the neighborhood were the development of the Kennedy General Hospital and the growth of the University of Memphis.

Named for the Royal Forest in Nottinghamshire,England, that is famous through its historical association with the legend of Robin Hood, so many of the street names have that theme: Robin Hood Lane, Maid Marion Lane, Friar Tuck Road, Little John Road, Nottingham Place and Allandale lane.

Last Week: Woodruff Fontaine House. Rising from ancient magnolia trees, the Woodruff-Fontaine House stands as a reminder of an era long gone. The Woodruff-Fontaine mansion is of French Victorian architecture with a Mansard roof. The woodwork is solid cypress, machine carved, and the flooring is mostly cypress original to the house. Embossed design on the hallway ceiling at the top of the third floor stairwell is hand hammered tin in a classical design.

Another fascinating artifact in the mansion is a hidden door which will be opened for your guests to see the many personalized autographs and memories, hand-written by the craftsmen from around the world who built this magnificent mansion. Amos Woodruff was a carriage maker and Noland Fontaine was a prominent cotton factor.

The mansion is always elaborately decorated every holiday, reflecting the holiday as it was during the Victorian era, and the unique gift shop features unusual treasures at very reasonable prices!

Jimmy Ogle gives free walking tours in Downtown Memphis during the Spring and Autumn.
Go to jimmyogle.com for the 2014 Spring season schedule and locations.

Shelby County Courthouse: Third Thursday each month at 12:00 noon
TUESDAY TOURS: Tuesdays from April 1 to June 10 at 11:45 a.m. for about four blocks from a different
street corner each week

QUESTIONS ANSWERED BY TOM KING:

How do we take steps to lower our property taxes?

What is the timeline for lowering our property taxes?

What is the difference between a commercial property appeal and a residential property appeal?

Why is your pricing talked about as a no-way-to-lose investment?

What sets you apart from other tax appeal professionals?

QUESTIONS ANSWERED BY JO GARNER:

A lot of people are skittish of an adjustable rate mortgage after the real estate crash. How do you use them today with clients?

If you want to reduce your interest rate costs AND pay the loan off sooner, you can do it quicker using the Adjustable Rate Mortgage but you better have a plan in place and work your plan on when and how to prepay the mortgage early.

I put my own parents in an adjustable rate mortgage that made an adjustment every single year. But it had some safety caps on the it which means the rate could not go up or down any more than 2 interest rate points per year. My parents were less than 10 years from wanting to retire and wanted their house paid off. They had just sold a home with about $50K in equity in it that they had owned since 1965. My parents used as a down payment their equity from the sale of the old house in Jackson, Tennessee and paid down the loan balance on the new loan to a more than manageable payment. Since they had a 1-year Adjustable rate with a rate about 3 points below the market rate at that time in 1992, they used the amount they were saving on the extra low payment to pay extra on the balance of this new loan. On a 1-year adjustable rate loan program—when the payment is adjusted each year, the new payment is calculated only on the UNPAID balance left on the loan.

My parents prepaid a lot the first year because they had that ultra low starter rate of about 3 points below the normal rate. The result was that by the time the rates moved up in any significant amount, the balance was paid so low, the payment continued to get less and less. My parents had the mortgage paid off in less than 10 years right before my dad retired. That is an example of using the adjustable rate as a tool.

Just one thing I want to point out about my parent’s when they sold the house in Jackson, Tennessee in 1992 that they had had since 1965—when the closing attorney asked for the house keys to give to the new buyers, my parents looked at each other a little surprised and then told the closing attorney they didn’t have a key to the house. They hadn’t seen the key to the house since sometime back in 1965. Wow! They never locked the house. That is a bygone era when people didn’t lock their doors, but I look back fondly on growing up in that town during that time.

How can you use adjustable mortgage rates to lower overall interest costs today?

Advantages: Help borrowers save and invest more money when the initial rate is lower than the fixed rate. To knock out some of the interest costs, you can prepay to principal during the very first part of the loan while the principal portion is so much lower than the interest portion. In a lot of cases this can allow you to pay off the loan early with tens of thousands less in interest expenses.

Offers a lower house payment for someone who doesn’t plan to live in the house for very long because some adjustable rates are fixed for the first 3 to 5 years before they start adjusting. Loans I did for resident physicians who were not going to be in Memphis more than about 4 years or so.

You have advantages and disadvantages to adjustable mortgage rates just like with fixed rate mortgages. You don’t want to do a debt consolidation loan with an adjustable rate for someone who is going to just run up more debt again. That kind of client needs some financial counseling , but a consolidation loan can be a great tool for someone paying off medical bills from an unexpected illness or if they are paying off old business expenses.

Here are your advantages for using an adjustable rate:
Sometimes the house payment is over $100 per month lower on an adjustable rate as opposed to a fixed rate and this could allow a home buyer to afford a bigger house than he normally would be qualified for on a higher fixed rate.
DISADVANTAGES: Rates and payments can rise significantly over the life of the loan. A 3.25 percent ARM can end up at 9.25 percent in just a few years if rates rise sharply.
The first adjustment, especially of the rate has been fixed for the last 5 years, can be a Big leap upward because some safety caps on the first adjustment allow for a big change in the first time adjustment. Most programs have safer annual caps on the rate to protect the borrower from as much interest rate risk as possible .

4^TH SEGMENT: REAL ESTATE TIP OF THE WEEK:

Jo’s announcements:

Talk Shoppe offers free education and networking to anyone interested in real estate or in business. This Wednesday June 18th, 2014 9A-10A at the YMCA Corporate office 6373 Quail Hollow Rd 2^nd floor Memphis, TN 38119 Contigo Creative LLCI will be presenting “Marketing To Latinos In The US.” For more information about Talk Shoppe, go to www.TalkShoppe.BIZ

Talk Shoppe gives a big thank you to the YMCA of Memphis for providing a place to hold the free business events for the community. The YMCA has opened registration for the YMCA Corporate Games, giving businesses a chance to PLAY LIKE A KID AGAIN …and….get some great publicity while having fun. If you would like for your business or employer to participate, contact the Y at www.ycorporategames.org or call Shauna Bateman at 901 766-7677 x 116

Next Saturday June 21^st, 2014 on the Real Estate Mortgage Shoppe, Phil Trenary of the Memphis Chamber of Commerce will be sharing his vision for bringing jobs and more value to the Memphis marketplace. Catch today’s podcast and our other podcasts from the Real Estate Mortgage Shoppe at www.MortgageLoansBlog.com

Transition Music: “Time” by Pink Floyd; “Time” by Bobby Sherman; “Rock Around The Clock” by Bill Haley

Look Back Memphis Trivia Contest: “Memphis” by Johnny Rivers

ABOUT TOM KING:

Tom King, certified Shelby County property tax appeal expert with King & Vaughan Consulting, is also a 35-year veteran appraiser in the Memphis area. taxappealexpert@gmail.com and www.golowertax.com

Jo Garner’s Bio

www.MortgageLoansBlog.com www.MoneyShoppe.NET (901) 482 0354 jogarner@mindspring.com

Jo Garner is a mortgage officer with extensive knowledge in tailoring mortgages to her customers who are refinancing or purchasing homes all over the country. She offers conventional, FHA, VA or other loan programs for refinancing and purchases.

Jo can help you look at rent vs buy, when it makes sense to refinance, how to get the best deal on your home purchase financing.

Jo Garner has been in the real estate/financing business for over 20 years. She got her start in Portland, Maine where she first began her real estate career. She received her real estate education from the University of Southern Maine and was personally mentored in San Diego, California by Robert G. Allen, author of Nothing Down, Creating Wealth and The Challenge.

On moving back to West Tennessee in 1987, she went into business buying and selling discounted owner-financed notes secured on real estate. In 1990 Jo went to work for a residential mortgage company and has been a mortgage loan officer for over 20 years. Her goal is to offer excellent, affordable service to her customers, tailoring the loan programs to the specific needs of her clients.

In addition to her work in the mortgage field, Jo Garner is the primary sponsor and founder of Talk Shoppe in Memphis. www.TalkShoppe.BIZ She was also the editor of Power Shoppe, a free weekly ezine designed for real estate professionals and others indirectly connected to the real estate industry and currently publishes on her blog www.MortgageLoansBlog.com .

For real estate financing solutions, plug into the Real Estate Mortgage Shoppe program. You can find mortgage rates, FHA Streamline refinance with no out-of-pocket costs, refinancing options, home purchase loan programs, answers and real estate, money-saving tips and more.

Research notes:

Monthly payments: 3 scenarios

A $20,000 credit card balance at 16 percent interest plus a $200,000 mortgage at 4.5 percent interest yield about $1,480 in monthly payments. Consolidating the two into a new, 30-year mortgage at 4.5 percent saves about $364 a month. Consolidating the two into a new, 15-year mortgage at 4.5 percent costs more per month, but less over the life of the loan.

Created with Highcharts 3.0.7

Total interest paid: 3 scenarios

A $20,000 credit card balance at 16 percent interest plus a $200,000 mortgage at 4.5 percent interest rack up $190,936 in interest payments over the life of the loans. Consolidating the two into a new, 30-year mortgage at 4.5 percent saves about $9,642 in interest. Consolidating the two into a 15-year mortgage at 4.5 percent saves almost $100,000 more.

What debt consolidation mortgages are for

Those with enough equity in their homes have been able to substantially reduce the monthly payments on credit card debt, student loans and personal loans, says Michael Moskowitz, president of Equity Now, a mortgage bank in New York City.

“I wouldn’t recommend it to someone who is going to run up their credit cards again,” he says. “If that’s the case, you need financial counseling, but for people who will not do that — who had medical expenses, business expenses and ran up their credit cards — a debt consolidation mortgage is a good solution.”

He cites the case of a client who had a mortgage-free investment house and more than $75,000 in credit card debt. The homeowner had used credit cards to pay for repairs after the home was damaged by Superstorm Sandy. After cashing out about $175,000 of the equity, he paid off the credit cards, kept the extra money and his monthly payments were reduced by about $1,700.

Get one only if you really need it

Think of the equity in your home as a sacred savings account: You can tap into it but only when truly needed, says Rick Harper, director of housing and senior vice president for the Consumer Credit Counseling Service of San Francisco.

“Depending on the circumstances, (use equity) for big-ticket items such as tuition, a sudden illness that devastates the budget, sometimes even the purchase of an automobile when you have thought things through and you have compared that financing cost to what might be available,” he says. “But don’t run out and use it for credit cards for vacations, for frivolous things because it is not an unlimited source, as we saw when the market turned.”

Fix budget errors that the loan addresses

The main concern with using equity to pay off credit cards is that often, it is a temporary solution to a much bigger problem.

“The real issue behind the credit card debt is that they may need to create a better spending plan for the family,” Harper says. “And if you haven’t addressed that deficit or the reason that credit card debt continues to grow, then you are going to find yourself right back in that situation again and there may be no equity at that point.”

Requirements are similar to a regular refi

The requirements to get a debt consolidation mortgage, or cash-out refinance, are not much different from those to get a standard mortgage — except for the minimum equity requirement, says Bill Banfield, a vice president for Quicken Loans.

If you are trying to get the maximum loan amount, which is generally 85 percent of the value of the home, you should expect to need a credit score of at least 700, he says.

But if your current mortgage and the amount you plan to borrow totals less than 80 percent of the value of the home, then the credit requirements are fairly similar to when buying a home, he adds.