Your Questions About Mortgage

Jenny asks…

What precentage of mortgage interest is refunded in taxes<?

So Far this year I have paid over fifteen thousand dollars in interest on my mortgage. Is there a certain percentage that is refunded when I do my taxes? Also, are closing costs refundable too?

admin answers:

Depends upon your marginal tax rate and filing status.

Only the amount that exceeds your standard deduction gives you any benefit. If you’re married filing a joint return, your standard deduction is $10,700. For sake of argument let’s say you paid $15,700 in interest. Your deduction would reduce your income by $5,000 more than the standard deduction. If your tax bracket is 25%, your benefit would be a reduction in taxes of $1,250. That would be about 8% of the total interest paid in your case.

Most closing costs must be added to your cost basis. They’ll reduce your gain when you eventually sell. Prepaid interest (points) can be added to the mortgage interest and deducted in the year you close on a purchase mortgage. If your mortgage is a re-fi, you must amortize the points over the life of the loan.

Whether or not you get any refund depends upon your net tax liability and how much tax was withheld during the year.

Robert asks…

What is a mortgage investment and how do I get started?

I inherited a large amount of money and someone mentioned getting into mortgage investments. I don’t know a thing about them. I already have my Roth IRA and other mutual funds going so I want to try something new but I don’t want to get taken advantage of.

admin answers:

If that someone means for you to personally buy mortgages, forgetaboutit, too much trouble to collect, let the pros handle it. Thornburg Mortgage Company (TMA) is (in my and others opinion) the best managed company in the mortgage business. Year after year, when others were reducing dividends due to reduced earnings, TMA was churning out 10% plus in dividends per year and seeing an increase in their stock price. Now I am getting 14.7% yield on my original investment. For a less risky investment, a mutual fund is the way to go. Vanguard GNMA Fund is among the best (again, in my opinion, and the opinion of many employees and customers of Vanguard). But just don’t take my word for it, do your own research.

Thomas asks…

mortgage……………………………………………………………….?

i have just applied for mortgage online and been accepted in principal?does this mean i have got it?i am a first time buyer

admin answers:

Brian,

A) I think you mean “in principle”. That probably means contingent upon one or more conditions being satisfied.

B) Personally, I have never issued a response like that, or worked with or for anyone who ever uttered those words or provided a document including that term.

I suggest getting pre-approved (should be free). That means providing your documentation and the loan originator has your credit report. Don’t pay any upfront fees, and get a written “lock” confirmation after pre-approval ensuring that your loan program is correct, and that the rate/payment and closing costs are no higher than you agreed to.

Lastly, I hope you are actually speaking with the person you’re dealing with and having your questions answered.

Good luck.

Paul asks…

Mortgage ?

Can I cosign on a mortgage when I have no credit? As in no bad credit, no good credit?
I would be cosigner. Hubby is the major bread winner.

I have never had a credit card, but have paid my car insurance on time always, etc.
I would be cosigner. Hubby is the major bread winner.

I have never had a credit card, but have paid my car insurance on time always, etc.

admin answers:

You can’t sign for a spouse in most states anyway. If you live in a community property state his debt is your debt regardless.

But, for your question, no, you have to have good enough credit to qualify for the loan yourself in order to co-sign for another person.

Nancy asks…

Mortgage???

we are looking to get a mortgage, my husband is self employed and on a good income which is provable, i work part time so don’t get alot so i know my wages wont be included. where is the best place to go for a mortgage when you are self employed? and has any one out there got a self cert mortgage can you give me any info on them?
Many Thanks

admin answers:

Your husband will not need a self cert mortgage if his income is provable. Besides in the last couple of years self cert mortgages have become few and far between as reputable lenders try and distance themselves from this type of lending. You can still get this type of mortgage but may have to pay over the odds. You should speak to a mortgage broker who will be able to advise you as to the best way to move forward. When dealing with a broker discuss with him his brokers fee. In my opinion you should not pay more than £250 for their services. I know people who have been charged £2,000 for this service. Negotiate.

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