Here are a few tips that could save you, and your piggy bank:

Trading Up
If you are planning on moving out of your current home into a new one, there are some major cost cutting ways to save you big bucks. When you sell your current home, you will hopefully make a lot of money, but may be giving much of it to the government in the form of capital gains taxes if certain conditions apply. What if there was a way to sell your home and keep all the profit for yourself? It sounds pretty good, huh? If you haven’t heard of this before, it’s because usually only experienced agents use it. This helpful tool is called a 1031 Like Kind Exchange. It is simply the process of selling your home the same way that you normally would, but trading it with the process of the 1031, which defers all the taxable gain from your first home and lets you keep it until you sell your new home, but if it’s your dream home, why would you? The only catch is that the home you are transferring the funds to must be worth more than the house you are selling.

Keep Some Cash Readily Available
Having cash on hand can help you save on extra costs that are involved in moving up. Being able to pay as large of a down payment as possible can get you better interest rates and simply more types of loans. If you are able to put 20% of the cost of the loan as a down payment, you will probably be able to skip the cost of Private Mortgage Insurance (PMI). Even if you can’t put that much down, we can save you thousands with some advice on how to pay your PMI and how to taxably deduct it.

Keep Your Credit Clean
Your credit score will have a big impact on what type of loans you will be able to have. Your credit score will range from 350-800 and anything under a 720 could drastically limit your possibilities. Knowing your credit score can prepare you for what you need to do. Even though you may have had great credit for your first house, any late or missed payments on credit cards or loan payments may have had negative impacts on your FICO credit score. Being able to pay down some of your existing debt and catching up on all your payments is a start to increasing you score and your chances to get a good interest rate on your loan. For a free look at your credit report, you can go to either of the three credit bureaus: Experian, Equifax or Trans Union.

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Here are a few institutions that you can look into to get money for your home:

Banks
Some banks make real estate loans, but most prefer installment loans for business and other types of property. Financial institutions can be very important partners, especially as one develops commercial property.

Mortgage Companies
Usually, mortgage companies are investors and will do many types of loans and typically sell their loans in the secondary market to other financial institutions. Do not worry about the resale of your loans – it’s no big deal. On the other hand, mortgage companies typically do not allow you to buy down your loan. Look at the financing package to make sure there are no prepayment penalties as well.

Insurance Companies / Finance Companies
occasionally make home loans, but finance companies are looking for high profit/high risk opportunities in general.

Other People’s Money (OPM)
The people you are buying from can give you an “owner take back mortgage” (second mortgage); they can take property as a substitute for money; they can take personal loans, which you will pay back; they can trade for services; they can trade for other properties; they can put you in touch with other investors who make money on loaning to you; or they can become partners.

For more detailed information on the home buying process, and more tips for not only getting a home loan but about the entire home buying process, check out our Buyer’s Roadmap

So, I am guessing you are thinking about buying a home and that someone probably keeps telling you about different kinds of mortgages and all sorts of statistics on how you can save money by doing this and that. Well, some of that seemingly mind-numbing information can be important, but simply knowing the basics about a mortgage and the different types available will allow you to make an informed decision.

A mortgage is a loan secured by a property or a house and paid in installments over a set period of time. It is a secured promise that the money borrowed will be repaid. This could be one of the most serious financial decisions you will make, so understanding all the ins and outs of one is very important; at the very least, have a close adviser who understands.

A loan is simply a really big credit card, usually with lower interest rates, that you repay over a long period of time. The two lengths of mortgages that people usually choose are 15-year, and 30-year loans. This means that you will repay the amount the loan is for to the lender over this amount of time. The 15-year mortgages have higher interest rates in general because you are paying over a shorter period of time and the lender is collecting interest for 15 years fewer than a 30-year loan. To combat the lender’s loss, they usually bump up the interest rates. That extra percentage is usually worth it though, because by paying it off in only 15 years, you will save upwards of 10 thousand to 40 thousand dollars on average (versus the same loan amount with a 30-year mortgage).

A 30-year mortgage will usually give you a lower interest rate than a 15-year mortgage, but in the long run having it an extra 15 years will cost you many thousands of dollars more than paying it off faster. So you have a choice to make… do you want to pay off your mortgage over a longer period of time, but how a lower monthly payment? – or – Pay it off faster, save thousands of dollars and have a higher monthly payment? It really is a tough choice, but that is the first step in understanding what a mortgage is.

One of the most important things to do before you decide to buy a home is make sure you hire a certified home inspector to go through the home and check to make sure everything works. An appraiser could make you pay for amenities that are faulty or that don’t work at all. It’s not their fault, their job is to just see if amenities are there, not if they work. The Inspector will also make sure things that need to be repaired are repaired or the price is detracted from the purchase agreement.

Here is some information I received from an exclusive buyer’s agent in Hamilton County, Indiana on saving money.

Questions to ask about the owner:

• Why are they leaving?
• Are they facing difficult financial issues?
• How long has the house been on the market or been vacant?
  A long time on the market can motivate the seller to be flexible. Follow ads and check on the ones that are aging.
• How long have the current owners lived in the neighborhood?
  Living there a long time often means they have the capacity (financially) to help you finance the purchase (they have equity). This depends on how much of the equity they have spent via providing you with second mortgages, etc.
• Are they open to creative financing?
  For example, would they consider a lease with the option to buy or would they sell on a land contract?

Knowing all of these areas can save you lots of money in the future, along with having a buyer’s agent who can work solely for you and provide you with all the information that is meant to save you money, not the owner. Having an experienced buyer’s agent to help you with the purchase agreement will be one of the best experiences you can get in the home buying process.

1. Partner with others by buying an investment property while rates are low. Like all things—the management can easily be learned if you are willing to be self-taught or to research the field.
2. Refinance your home—use the cash to buy an investment property. The rates may allow for a low enough payment so you can hire a management company. If possible, put the home on a 15 year amortization. One house will provide you with more income than social security when you retire.
3. Use your present home as an investment property, and then purchase another home for yourself. This is the easiest way to get into real estate if you have a home that currently will allow you cash flow when it is rented.
4. If you are investment guru, refinance and use your refinance capital in a fast growing, i.e., a relatively safe investment. Apple computer comes to mind—amazingly profitable during this recession.
5. Consider purchasing a home on contract—preferable with at least a 3 or 5 year contract. Inflation will eventually make it a good investment when the economy turns. This is easily done if you purchase from friends and associates who trust you.

The bottom-line is not to refinance or use money for common, everyday expenditures, but to access money for investment purposes. Having investment property conjures up stories similar to the stories about sales people i.e., always about the sales that were hard sell and negative. But the horror stories are reduced dramatically if you educate yourself and get professional help (professional management). Real estate may sound difficult, but keep in mind that approximately 80% of wealthy people did it with real estate. A business can falter and fail, but a home in a good community will always rent if the price is right.

If you need any assistance with making an investment decision, we are very experienced in that area and would love to help. Contact us here.

Also, if you are interested in purchasing a home in Indiana and know what you are looking for, fill out the Inspire Home Finder form below and we can help you out there as well!

Great Schools

The future of our children should be at the forefront of our minds when we really think about it. There is no better way I can think of to invest in our children than by making sure they receive the best education around. Fortunately for you, Fishers, Indiana is a part of Hamilton County a.k.a. the best school system in Indiana and one of the top five school systems in the United States. After your kids go through high school, they can attend a college in Indiana as well. There are very prestigious universities in Indiana, including Indiana University, Purdue University, Butler University and many others. After college, your children can even stay in Indiana to pursue a successful career in many fields. Indianapolis is home to many national headquarters with high-end jobs.

Great Fun

Wow, where to begin? …homes in Fishers for sale will plug you into a community of people who love to have fun. This is especially true if you live on Geist Reservoir. Also known as “Lake Geist” or “Geist Lake,” its real name is Geist Reservoir because it is one of Indiana’s many reservoirs. It is home to many of Indiana’s wealthiest individuals including local celebrities and sports figures. Along with these people, there are many people on the lake who simply love to be around the lake culture and simple rent “slips” on the lake to store their boats. I have spent much of my life on Geist and always love every minute of it. Living on the water is the dream of many Hoosiers and is definitely a good location to consider if you can afford it.

Great Economic Culture

Buying homes in Fishers for sale will allow you to be very close to many great businesses. Many local businesses call the Fishers, Indiana area their home. Downtown Fishers is a unique and bustling strip, where you will almost always see many of your neighbors and local connections meeting and mingling. There, you can get everything from great sushi to great ice cream, with, of course, great company. In Fishers, there are many office complexes containing very successful businesses, but if you do not want to work at one of those organizations, there are many other business hubs around the Indianapolis area, but the most jobs are found in downtown Indianapolis itself. Buying homes in Fishers for sale is great because Fishers is one of the most convenient and best places to live if you have a job in downtown Indianapolis. A main interstate (I69) runs directly through the heart of Fishers and allows for a very quick commute to Indy.

So, as you can see, buying homes in Fishers for sale will allow you and your family to enjoy great schools, great fun and a great economic environment.

If you are ready to begin your search for a home in Fishers, fill out our Home Finder by clicking the link below and we will send you a list of homes that you will most likely fall in love with in Fishers.

1. Preparation for negotiating a home in Fishers for sale is one of the most important parts. “Know the Seller.”  The more you know, the more problems you can solve. Do they have personal issues – are they getting divorced? If so, they may want to sell fast. Are they upgrading to a new house, or are they downsizing? Is there a major timing issue? If so, you can use these areas to negotiate in your favor and also to help the seller.
2. Negotiation is about finding a win-win solution. Never give away anything without getting something in return.
3. Know what you are willing to negotiate before you go in. Set your limits before you ever go in and stick to them.
4. Never discuss an issue about the home unless you are ready. If you are not ready to talk, then don’t do it! Never be pressured to answer a question you know nothing about. Don’t be ashamed, be honest, be smart.
5. Be in control. If you are an emotional person, you are not a good negotiator. Being emotional and getting worked up will only lose you money and possibly the home. So, let someone else in Fishers (i.e. a Buyer’s Agent) negotiate for you.
6. Listen. Sometimes when people say they are giving you a price that they offered their sister, they mean it! Know when to take a deal; by listening, you can find it.
7. Meet me half way. I have heard this before and it’s a lie.  If they offer to cut a price in half, cut yours by an 1/8th.  Who said you had to always negotiate in halves. That is a way to lose the house in Fishers for sale, small concessions is how you win.

Knowing the basics of negotiation can save you thousands of dollars on the house in Fishers for sale that you want. Make sure you understand the rules, and make sure your agent knows them even better than you. If you are in the Hamilton County area in Indiana, we at Inspire Real Estate would love to represent you by listing your house or finding one that will fit your needs.

Are you ready to begin your search for a home in Fishers for sale? Click below:

Learn more about Fishers, Indiana here.

If you are ready to start looking for Westfield, IN houses, click here, or click below:

With a population of 24,000, Westfield, IN holds its own when compared to other cities in Hamilton County, Indiana. Speaking of the fact that it is in Hamilton County, did you know that Hamilton County is consistently rated one of the best places in the United States to live? …and not just by the locals, we’re talking opinions from Forbes Magazine, BusinessWeek Magazine and many more. Hamilton County, IN is also ranked as having the best school system in Indiana and usually within the top 5 school systems in the country!

The historical aspect of Indiana is rich in Westfield, IN. Houses in Westfield, along with parks and cemeteries, have been proven to be a part of the famous Underground Railroad! Can you imagine owning or living near one of these landmarks that served such a great cause in our nation’s past?

Best of all, if you are looking to buy a home that is affordable, you should definitely search in Westfield, IN. Houses there easily fall into the first-time homebuyer category. This is because they have been able to remain fairly inexpensive compared to nearby cities, while retaining their great quality. In Westfield, IN, houses come in every shape and size. There are single family homes, residential communities, golf villas, apartments, large custom homes, townhouses and pretty much anything else you can think of.

One aspect of home ownership that many people forget about is the fact that they like to be entertained. This is absolutely no problem at all in Westfield, IN. Houses that are bought in Westfield automatically bring you close to Indiana’s most entertaining side of town. With a championship golf course and very close access to central Indiana’s most popular concert venue, Westfield is a great place to live life to the fullest.

If you are ready to start looking for Westfield, IN houses, click here, or click below:

As viewed from the eyes of this middle-aged economics professor/real estate broker, with 25+ years of experience in consulting, Midwest economies look pretty rough.

Once Pandora is out of her box, it takes a substantial amount of time to put her back, pandora being the money supply. Inflation by definition is “too much money chasing too few goods.” If we get inflation (and we will, if the economy doesn’t double dip), housing will be a good place to be. This dose of inflation will go beyond anything we have ever experienced in the past. If you don’t own a house, you will be on the wrong side of history. If you have made conservative real estate investments in residential real estate, the future is much brighter.

I am someone who has spent much of my life consulting. Midwest companies have never suffered like this in my lifetime. No jobs means … no residential building, no tax revenue and no solution in the short run. Ultimately something has to give or we will be living on top of each other… a demand bubble is coming. So as things change, get ready for a wide ride, and the people in Washington won’t be much help. Tap into the historically low rates we are now experiencing, because you won’t believe how high the rates will be 3 to 4 years out.

Visit our Home Finder to start looking at Indiana houses asap!

or check out why you should look for homes in Indiana for sale.

By August and September many who planned on moving have moved—thus fewer potential purchasers are on the hunt for homes for sale in Indiana. But the advantage for purchasers is that inventory levels are typically still quite high. Fewer buyers, more inventory, and (this year) unusually low interest rates equal an amazing time to purchase a home. This is the ultimate buyer’s market.

Still many may wonder how long the interest rates will remain so low. Nobody knows for sure, but most economists are betting on inflation rather than deflation for 2011. Because of the large amount of stimulus made possible by Chinese loans and the Federal Reserve’s printing presses, rates are bound to go up early next year or by late next year for sure.

A good analogy for what we will be seeing is the proverbial dog running to the end of his leash… he is feeling his oats, but doesn’t know that his time of reckoning is near. When he gets to the end of his rope, he makes a stunning discovering i.e., things in motion tend to stay in motion. His neck gets stretched. Now the application to real estate: the government prints money and borrows money, but if a person is afraid that the recession isn’t over, and additionally that he/she might lose their job, he/she won’t spend. When people decide not to spend, it won’t matter how cheap money is, the economy stalls.

Once people begin to gain confidence, they start to spend money. Since money is cheap and widely available, they will overspend. The government reacts by stopping the printing presses, slows the borrowing from abroad, and increases interest rates. Since monetary policy, unlike fiscal policy (tax policy can have an immediate impact), the impact is not immediate (6 to 9 months lag). So even though M1 (primary measure of the money supply) slows, people don’t stop spending. This can produce dramatic inflation.

When people realize home values are going up faster than their ability to pay, the market hyperventilates and we get hyperinflation. Example: During the late 1970s many couples would work multiple jobs so they could purchase larger, more expensive homes. They believed inflation would eventually make the home they purchased affordable. That worked until Reagan became President and consequently brought tight monetary policy.

Ok, Phil we can see that you used to teach economics, but what does this mean to me? Well, it is better to own property when rates are low and to become an owner prior to an inflationary spiral. Inflation this time will make the late 1970’s look mild. Now is likely the best time to buy.

Homes for sale in Indiana, especially in Hamilton County, will do well when inflation arrives, and it will arrive in the not-too-distant future. That makes this summer/fall a great time to buy, if you can safely do it.

Visit our Home Finder to start looking at Indiana houses asap!

or check out this info about why you should buy homes in Indiana for sale.