Your Questions About Check My Mortgage Interest

Chris asks…

Personal Finace Help Please (Check My Work?)?

1. What can be the best type of safety net in hard times? (1 point)
Gambling
Mortgage
Rental property
None of the above*

2. Generally, you need to live in a home ________years to break even on closing costs. (1 point)
One
Two
Three*
Four

3. What is generally the most complicated financial transaction the average American will ever undertake? (1 point)
Buying a boat
Buying a car
Buying a home*
None of the above

4. Real estate is considered a/an ________investment. (1 point)
Illiquid*
Liquid
Sure
Partially-liquid

5. Individual mortgage interest rates are generally determined by what? (1 point)
The economy
The individual’s credit score
The property value*
The state the property is located in

6. What is PMI? (1 point)
Personal mortgage issuance
Personal mortgage investment*
Personal mortgage insurance
Personal mortgage interest

7. Who dictates how much insurance a homeowners must carry on their property? (1 point)
The state the property is located in
The bank that holds the mortgage
The owner*
None of the above

8. Assuming you have a 30-year fixed-rate loan, you’re paying _____% interest during the first few years. (1 point)
90
80
70*
60

9. Why is investing in gold beneficial? (1 point)
It is easy to mine.
It is considered a stable investment.
Gold is more expensive than stocks.*
The value of gold is subject to inflation.

10. What type of insurance may a homeowner need? (1 point)
Hurricane insurance
Flood insurance
Firestorm insurance
All of the above*

admin answers:

My answers have # after them.

1. What can be the best type of safety net in hard times? (1 point)
Gambling
Mortgage
Rental property
None of the above*# (Emergency fund, cash, is the best safety net.)

2. Generally, you need to live in a home ________years to break even on closing costs. (1 point)
One
Two
Three*#
Four

3. What is generally the most complicated financial transaction the average American will ever undertake? (1 point)
Buying a boat
Buying a car
Buying a home*#
None of the above

4. Real estate is considered a/an ________investment. (1 point)
Illiquid*#
Liquid
Sure
Partially-liquid

5. Individual mortgage interest rates are generally determined by what? (1 point)
The economy#
The individual’s credit score
The property value*
The state the property is located in

6. What is PMI? (1 point)
Personal mortgage issuance
Personal mortgage investment*
Personal mortgage insurance#
Personal mortgage interest

7. Who dictates how much insurance a homeowners must carry on their property? (1 point)
The state the property is located in
The bank that holds the mortgage#
The owner*
None of the above

8. Assuming you have a 30-year fixed-rate loan, you’re paying _____% interest during the first few years. (1 point)
90#
80
70*
60

9. Why is investing in gold beneficial? (1 point)
It is easy to mine.
It is considered a stable investment.
Gold is more expensive than stocks.*
The value of gold is subject to inflation.# (Value of gold goes up with inflation.)

10. What type of insurance may a homeowner need? (1 point)
Hurricane insurance
Flood insurance
Firestorm insurance
All of the above*
(This question excludes many important factors. All mortgage companies require “fire”, not “firestorm” insurance to protect their investment. There is no such thing as “firestorm” insurance. In hurricane zones you may be required to purchase hurricane insurance.)

Mary asks…

Will the government ever pay you if your tax return is negative?

I was laid off in March (and paid 1300 in taxes) and haven’t had taxes taken out of my unemployment checks. It would seem that with three kids and paying mortgage interest that the amount I can write off would put my tax bill in a negative. Does the government every pay you or does it just say we owe nothing.
I remember last year we were only able to take about 1200 of the 1500 we were due with Child Tax credit so that got me thinking about this question.

admin answers:

It sounds as if it is likely that your “taxable income” will be negative. The lowest that your actual tax liability can be however is zero, so having a negative number is of no additional benefit. You should be able to get back the full amount of your federal withholding and perhaps some refundable credits such as the Earned Income Credit or Additional Child Tax Credit (form 8812).

David asks…

Low Interest Rates = Pay off Mortgage with Savings?

With the UK base rate now at 1.5% i checked my halifax isa and it is earning a wopping 0.10%!!!! wow. As long as I keep an emergency cash fund should I now be sticking my savings into paying off my mortgage which is currently at 5% as they are clealy not going to earn more than that in a bank?

admin answers:

Interest rates on loans and mortgages are almost always higher than even the best rates available on savings. So in general you will always be better off in the long run by paying off debts rather than having savings and debts.

If you are a taxpayer you actually get an even better saving, because you will be taxed on any interest you earn on you savings. But when you pay off debts you get the “full benefit” of the interest rate.

However, as you say, it is always useful to a some savings put aside for an emergency. You might suddenly need to pay if you car engine blows up or your boiler breaks down. If you had no savings you might end up putting these expenses on a credit card and paying 25% interest!

If you have a sensible emergency fund I would put the rest onto your mortgage. Although check whether they have a limit to the amount extra you can pay back – some do.

The best of both worlds is offsetting your savings against your mortgage. You keep them in a separate account to use if you need. But while they are in the bank, instead of earning interest they are deducted from the outstanding amount on your mortgage. You pay less interest, so you get the same benfit as if you have actually paid that amount back. Quite a lot of mortgages have this facility so it might be worth checking.

George asks…

Getting more refund when filing MFS compared to MFJ , check this and let me know ?

Here are my numbers, let me know which one is better in my case either filing taxes MFJ or MFS

Husband(37)/ Wife(31):
===========
Gross: $48000 / $11700
Fed witheld: $3500 / $779
SS tax: $2975 / $725
State witheld: $1320 / $350

– we have ONE kid of age 4.5 yrs ( no expenses for her, no daycare)

-Medical Expenses
==============

$5000 ( paid for the medical premiums for year 2010 from my paychecks)
$1300 ( medical bills) – HSA account
=====

Total $6300 ( medical expenses )

– 1099- INTEREST Earned => $275

– 1098 – MORTGAGE interest paid => $ 6800

– Property taxes paid => $3100

– That’s it no other expenses,charities or deductions…

Let me know for my case either its good to file MFJ (or) MFS for the 2010 taxes

I am not an US citizen or a resident alien of USA. Does this effect the EIC what you guys are mentioning ? Does EIC is for only US citizens and the resident aliens ?

admin answers:

If you had filed it seperately, the there will be no EIC. Even standard deduction lose, the other person should itemize the other person as it has the right.

Sandy asks…

Can someone please help me understand why we always have to pay in taxes instead of receive a tax refund check?

My husband and I always have to pay in atleast $2000 at tax time instead of receiving a tax refund and we arent sure why.

We are married, with no kids. He claims “0” on his W-4 and I claim “1” but am changing that to “0” today in hopes that the change helps. (hard to believe that would eliminate the $2000 pay in though)

We make a total of around $63,000 a year.

We have mortgage interest and student loan interest.

Can someone please help! Thanks

admin answers:

Simple: You are not having enough tax withheld from your pay. If you are both filing your W-4s as Married, at least $18,700 worth of taxable income isn’t being considered, and at your tax bracket (15%) that works out to just about what you are pulling up short.

The tax withholding tables treat married taxpayers as the “traditional” single-income family. Since you both work, they work against you. You need to change your W-4s to “Married but withhold at the higher Single rate” and probalby 1 allowance each.

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