Your Questions About Mortgage

Mandy asks…

How do you pay your mortgage or rent when you retire?

I am 28 in the USA. I haven’t got a mortgage. When I am retired and living probably in private rented accommodation, who pays the rent? Or what about if you haven’t finished paying off your mortgage but have to retire? I’m planning for my future!

admin answers:

The idea is to pay off your mortgage way before retirement. Rent would be paid from your pension.

Laura asks…

Can a Mortgage Company hold your insurance check for the repair of your building?

My building suffered damage with a hail storm. The insurance company sent me a check made out to the mortgage company and to me. Now the Mortgage company is holding the funds and I can’t finish the repairs needed. My mortgage payments are up to date.

admin answers:

You did not say if YOU are doing the work or having it done.

Sounds like you need to contact your mortgage company and simply find out what they need to release the check (who has physical possession of the check at this point? It should have been mailed to you)

Then simply follow that guideline…

Betty asks…

How do I get the best deal on a mortgage? What kind of questions should I be asking the mortgage broker?

My partner and I are first time home buyers. We have saved almost 20% of the property and both have secure well paying jobs. Unfortunately we do not know much about mortgages and want to get the best deal possible. Should we see more than on broker? Should we get our own mortgage quotes as well? Do we have to pay trailing commissions?
We are in Melbourne, Australia.

admin answers:

Hello, do as much research as you can – brokers are great if you don’t have the time but if you do you are far more likely to understand what you’re getting into and find the best and most suitable product for you. These days, it’s so easy to get information from multiple banks – I’d recommend calling rather than going online as they can ask you questions about your specific situation and make recommendations, the information on the internet is onlyn broad.

You don’t have to pay any commissions to brokers – this is all paid by the banks. They pay an upfront commission then an annual trailing commission for each year you have the loan with them.

With your substantial deposit as well as strong employment you are also in a good position to negotiate with the banks – don’t be afraid to do this, you are stuck with this loan for a long time so spend the time now getting it right!

Be careful with what broker you choose – if you have to go with one only go with the mainstream broker companies (eg mortgage choice), there are some dodgy ones out there and lots who will just sign you up and then you’ll never hear from them again. To be honest you’ll often get the best deal going direct through the bank – they have more specific knowledge about their own policy/procedures whereas the brokers only have basic knowledge of maybe 10 – 20 different banks.

If you are borrowing over $250K, look for a package – this will involve an annual fee but the cost for this will substantially outweigh the costs saved in interest rates and fees on your home loan as well as all your other banking.

Good luck! Remember, the more research the better. Don’t just trust one specialist – if you are fully educated and informed then you will be the best specialist on your particular financial situation.

Sharon asks…

How to deduct the Mortgage expenses on a Rental Property taxes?

I’m renting my house, which I pay the mortgage for. So I’m not sure how to deduct mortgage interest now. Any software I use there is a section for deducting your mortgage interest. But since I’m renting now I’m not sure if I should look at the mortgage interest as a job expense? Also since I’m renting now can I deduct the principal as well since I’m paying all that to keep my rental property?

admin answers:

Rental income and expenses go on Schedule E. Although you cannot deduct the principal paid on your mortgage, you can (and should) begin taking depreciation.

If this is your first time filing with a rental property, it might be to your advantage to visit a competent tax professional. Owning a rental property involves involves quite a bit when it comes to filing your taxes. There are likely things you will be able to write off that you don’t even know about. Although visiting with a professional (at least for the first year) will cost you a bit in the short term, it will likely save you greatly in the long term.

Lizzie asks…

What can the mortgage company do when I have two properties and can only afford one?

I have two homes with the same mortgage co. One I can’t afford and the other I can. The one I can afford has a little equity. Can they force me to sell it if I go into foreclosure?

admin answers:

If you go into foreclosure, the mortage company will not force you to sell, they’ll take the property and sell it themselves. If you aren’t in foreclosure right now, take the initiative to sell the property and ask for at least what you owe on the loan. Hopefully, it will sell and you will be able to discharge the loan before the mortage company forecloses.

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