Facebook’s recent IPO reminds us that a lot has happened, but not much
has changed - especially where money is involved.
Facebook ranks high among the social media that have changed the way
we think about staying in touch, but in spite of improvements to the
ease and speed of communication, consumers were still led
astray by the financial guys. Fallout from the Facebook IPO is the
current prime example. As in the past, after the fact, the debate
is raging on social media.
This should leave you wondering what else has not really changed
in the world of finance?
Credit card rates, especially store credit cards, are killers.
They are levied at rates that should stop people spending, but don’t.
Even the "best” credit cards listed on lowcards.com
lowcards.com
still have double - digit interest rates, which are significantly higher
than prime rates. No wonder credit card companies keep pushing higher
borrowing limits on consumers while the media continues to cry:
"Consumers must reduce debt!”
The cost of arranging a mortgage is not the cost of buying a
home. It is really the cost of borrowing the money to buy. As long
as this misconception continues, buyers put their time and energy into
searching for a "dream” house or condo, not searching for the best
available financing option before they find the perfect purchase.
Concentrate on learning how mortgages work and where costs lie, and
you’ll save money from the beginning. The hundreds or even thousands
not spent in the first years may mean tens of thousands over the
life of a mortgage. Or, perhaps you’d prefer to pay double (or more)
what you originally borrowed?
Home insurance costs rise while coverage doesn’t. Did you
have a detailed conversation with your insurance agent when your policy
last automatically renewed? Most insurance companies won’t cover homes
with knob and tube or aluminum wiring, old insul - brick exterior
siding, and a growing list of items. Don’t find out the hard way what
your insurance company has disallowed. Rising real estate values mean
rising costs of replacement if your home is destroyed by fire. Are you
sure the designated replacement value of your house is accurate?
Insurance companies are not there to ensure your home is protected,
that’s still up to you.
Condominium buying still focuses on how "cool” the lifestyle is.
This hooks buyers on amenities and decor. Amenities cost money, and more
money, to maintain. Therefore, the more exercise and play options
purchased, the more monthly fees will rise whether owners use these
goodies, or not. The condo mystique encourages buyers to spend more time
thinking about decor than on understanding their financial
responsibilities. Living by committee has long been my definition
of how condo living differs from home (fee simple or free hold)
ownership. This lifestyle shift means you may be buying space that you
won’t be able to use the way you want to. Bylaws explain the details,
but are not an easy read, so many rules are a surprise. Let’s hope the
continued boom in condominium building does not follow past patterns and
leave condo owners to live with expensive problems caused by
construction defects like the leaky condos disaster. That’s a set of
past financial woes we hope will not be visited on property owners
again.
We keep reinventing the real estate "wheel." That’s probably the
greatest financial stagnation of all.
First - time buyers know little or nothing about real estate and
finance after years of high school and secondary education. They still
learn the hard way like their parents and grandparents did. After a
series of real estate purchases - each time at the mercy of financially
- adept, incentive - motivated salespeople - consumers will have learned
something, but not everything consumers need to make confident, informed
real estate decisions.
Real estate buying has moved online and now aps make home buying seem
more accessible. Although a lot has happened, has much really changed?
Dorian Moffat
- Broker Associate / Realtor
Dorian
Moffat
Your Best
Move !!!
Diamond
Realty Group
Direct:
469-231-9308
Office:
972-312-0332
Fax:
972-499-3487
DorianMoffat@gmail.com
www.ecollincountyhomes.com
www.allentxrealtor.com
www.facebook.com/collincountyrealestate
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