Why Make an Extra Mortgage Payment?
Considering the current state of the economy, many people are trying to pay down debt to unburden themselves financially. Have you considered paying down your home loan? Your mortgage is probably the biggest debt you will have in your lifetime; paying it off early will save you potentially thousands of dollars that you'll keep in your pocket, to spend on vacations or college tuition, or to save for a rainy day.
 
If you're interested in paying down your mortgage faster, you can make just one extra payment per month — or even just one extra payment over the life of the loan. You'll be surprised at how much you can save!
 
Making a Difference
Here's an example. Say you have a mortgage for $210,000. Your interest rate is 4% and your original monthly payments are about $1,003. If you make just one extra payment of $1,000 on your loan, just once, you'll pay off your loan up to three months earlier, saving you all the interest you would have paid during that time.
 
Now here's a more exciting example. Using the same loan parameters above, if you add $50 to every monthly payment, you'll pay off your loan nearly two years ahead of schedule. Take a look at your loan statement; how much interest will you save now?
 
And another interesting tip: A single large payment early in the life of the loan will shorten your term and reduce your interest payments more than a contribution made later on, although any additional payment will show benefits.
 
Finding the Cash
If you get paid every two weeks, twice a year you'll get an "extra" check. Consider putting those two checks directly toward your mortgage. Even taking half of them and paying down your loan will help reduce your loan term and the amount you owe.
 
If you decide to make just one extra payment a year, consider budgeting for it every month. An extra payment of $1,003 is $83.58 per month, or $19.29 per week. Committing to setting aside the cash on a regular basis can make it seem more manageable, especially if it means just skipping a couple of coffees and lunch out one day each week.
 
Is This the Right Choice for You?
Remember, however, that paying off a home mortgage loan may not be the best choice for everyone. If you have other loans, especially ones with higher interest rates than your mortgage, then they should probably be your priority to pay off. Credit cards and car loans usually have higher rates than home loans.
 
In addition, the government currently allows homeowners to write off mortgage interest payments on their taxes.* if you are seeing significant benefits from this credit on your tax returns, you may not want to pay off your home loan at this time.
 
Making a Decision
Paying off your mortgage, as you can see, is not a decision to be taken lightly. Be sure to review all your debts and the interest you're paying. You may want to consult a financial planner or accountant to ensure eliminating this debt will have a positive effect on your finances.
 
If paying off your loan early is a move you're contemplating, please contact me so I can help you review your options, recommend a local financial expert if you need one, and provide any assistance I can so that you're able to make the best decisions for your personal financial security. I look forward to helping you save some money!
 
* We are not a tax advisory firm. The information contained in this article is for informational purposes only and may not reflect current tax year rules and regulations. Consult your tax advisor or the IRS for current tax year rules, restrictions and regulations.

Maximize Your Referrals
Repeat customers are the lifeblood of real estate professionals. But we also need to increase our sphere of influence in order to grow our business. Developing strong relationships with your clients will help you on both fronts, by promoting client loyalty and by providing value in order to spur referrals form those same loyal customers.
 
According to the National Association of REALTORS®, about 20 percent of all business their members receive is through repeat customers. If 20 percent of your clients are recommending you to their friends, families, and coworkers, you will grow a strong and healthy business. If they aren't referring you — well, let's make sure they are!
 
You're Also Selling You
You're not just helping clients find new homes and properties — you're also selling yourself as an expert in the field, a trusted advisor who is guiding your clients to making great decisions. You should have a service or area of expertise that sets you apart from the competition. Do you know the ranking and test scores of every school in the area? Do you specialize in investment properties? You need to make sure your strengths are put to the forefront in any conversation and on all your marketing.
 
Speaking of Marketing…
If you're handing out informative materials at every meeting and open house, gathering email addresses to add to your database so you can send out newsletters and greetings, and following up on every contact you make, your reputation as a go-getter will precede you and your name recognition should increase dramatically. Every flyer you create should have your photo and contact information on it; ditto with your business cards, open house brochures, and any other material you hand out to contacts. Create a social media presence, keep it separate from your personal accounts, and be sure to update regularly — weekly if not daily.
 
Be Consistent
If Client A recommends you to Client B, but Client B doesn't get the same level of service, you can bet you won't be getting another recommendation. Every client is a potential avenue to more business, no matter how big or small their purchase may be — and even if they don't purchase at all right now, circumstances could change. Make sure you're the one they want to call when they're ready to move forward.
 
Build Your Database
A box full of business cards isn't going to help you reach current and potential clients quickly, easily and effectively. An electronic database makes it simple for you to send out newsletters and targeted marketing for purchases such as moveups or second homes, and to keep in touch regularly with your contacts. Update your database constantly and be sure you follow up on bouncebacks or returned mail with a phone call to confirm contact information.
 
Every time you contact your database, you're reminding them of the excellent service you provide, and making it easy for clients to get in touch with you for their real estate needs or to pass your information on to others who are looking for a new home.
 
You're Asking for It
Probably the most important bit of advice is to ask for a referral! Ask both clients and business partners — they may not even be thinking that far ahead, so it's up to you to plant the idea in their minds. And make sure you've earned the right to ask by providing excellent and consistent service.
 
By following these guidelines your referral business should climb along with your customers' satisfaction with your service. Remember, earn the referral, and ask for the referral, and there's no reason you shouldn't get the referral. 

It's that time of year again: get ready to gather up the paperwork and settle in to get your tax forms completed. Whether you use a commercial software, stick it out on your own, or hire a professional, there are some documents you'll need to be sure you have to hand when you're maximizing the write-offs you can get by having a home mortgage.

 
Staying Organized
Hopefully you've been keeping all your paperwork organized throughout the year. If you haven't there is no better time than right now to start: Set up folders in your file drawers for 2013 and start putting the papers where they belong! When it comes to your home, you'll want to hang on to your mortgage bills and your year-end mortgage statement; any receipts for home improvements that increased the energy efficiency of your home; and any receipts for upgraded and energy-efficient appliances you have purchased. These documents are extremely important because itemizing your taxes is going to be the best way to maximize your deductions.
 
Mortgage Interest and Insurance
In general, the interest you pay on your home loan, whether it is a standard loan, a line of credit, or a construction loan, is tax deductible. Many people have refinanced recently and may be eligible to deduct the interest associated with the refinance as well. Specific restrictions do apply to the amount you can deduct and the types and numbers of properties that are eligible. In general you may deduct interest on your primary home and on one additional residential property. You may also be restricted by the type of loan you have; a home equity line of credit has different limits than a straightforward mortgage. At the end of the year you'll receive a Form 1098 from your lender which will clearly show your payments for the year and simplify taking the deduction on your tax forms.
 
If you are a fairly new homeowner or if your home is underwater and your loan-to-value ratio is 80% or greater, you will have private mortgage insurance on your home. These payments are also tax deductible, depending on your adjusted gross income. As your AGI increases, the amount you can deduct decreases.
 
Energy Efficiency Deductions
According to the Energy Star website, you can get a tax credit of either 10% or 30% of the cost of a number of home energy efficiency improvements. These include:

• Heating, air conditioning, and ventilation (HVAC)
• Insulation
• Certain types of roofing
• Water heaters
• Windows and doors
• Solar energy systems
• Geothermal heat pumps
• Small wind turbines
• Fuel cells

Check the website carefully as some credits apply only to primary homes, while others may be used on secondary homes as well, and some apply only to existing homes and not new construction. You must be certain to save your receipts and the Manufacturer's Certification Statement for your records.
 
Points, Taxes, and Other Deductions
Points are fees you pay when securing your mortgage. They will be clearly stated on your HUD-1 closing statement and on your end-of-year Form 1098. Points are deducted differently for first-time loans versus refinance loans so if you're doing your taxes on your own you'll need to read the instructions carefully.
 
If you bought or sold a property in the past year, a portion of the real estate taxes you paid are eligible for deduction. State and local property taxes are generally eligible as well. If you own investment properties, numerous breaks may be available to you, for things such as the property's mortgage, costs of repairs and maintenance, and depreciation. Consult a tax advisor for more information.
 
Real Estate: A Great Investment
Despite the recent ups and downs in the market, owning a home is still a great investment and can give you substantial breaks when it comes to your taxes. If you have further questions about mortgages or home ownership, I'm happy to sit down with you for a no-cost and no-obligation discussion about advantages and options. Call me today to learn more!
 
* We are not a tax advisory firm. The information contained in this article is for informational purposes only and may not reflect current tax year rules and regulations. Consult your tax advisor or the IRS for current tax year rules, restrictions and regulations

Experts generally agree that the Federal Reserve's quantitative easing (QE) plan has helped the U.S. financial recovery and stimulate the economy. As part of the benefits, QE has also helped bring increasing stability to the real estate market. But what happens now, and what does that mean for current and potential homeowners?
 
A Quick Refresher
QE is a means by which the national bank creates a quantity of money to buy assets, such as bonds, from regular banks and other financial institutions. This raises the price of the assets and artificially lowers interest rates. Bond prices and interest rates are inversely related: as one goes up, the other goes down.
 
Benefits to Borrowers
Homebuyers benefit from QE because as bond prices rise and interest rates fall, the interest on home mortgages falls. If you're buying a new home, this means you can pay a lower interest rate and effectively increase your purchasing power. You'll get more home for the money when rates are lower. In addition, people who refinance their home loans also see a benefit in reduced monthly payments when interest rates have fallen.
 
Continuing with QE?
In January of this year, Federal Reserve Chairman Ben Bernanke told a crowd at the University of Michigan that mortgage interest rates are now at a "credibly low" level and indicated that raising interest rates would harm the still-recovering economy. Currently all signs indicate that the Fed will continue its QE policy.
 
However, QE is considered "unconventional monetary policy" by most sources. Because of this it is widely assumed that the policy cannot continue indefinitely, no matter what state the U.S. economy is in. At last December's Fed meeting, the members were divided as to whether the policy should terminate by the end of this year, or possibly sooner. According to the minutes of the Federal Reserve's January 2013 meeting, several officials have expressed concern over the Fed's stated intent to buy billions of dollars in bonds each month until the economy has shown steady recovery. The members of the Fed agreed to review the policy during their March meeting.
 
How Does This Impact Me?
Ultimately the members of the Federal Reserve did decide to maintain QE at the same pace and with no fixed end date. But with concerns being raised by Fed members, it is possible we could see quantitative easing undergoing changes or even coming to an end in the near future. The Washington Post and several economic strategists even hedged that QE policy could come to an end later this year.
 
If you're looking to maximize your purchasing power or to benefit from today's fantastically low interest rates by refinancing, we really don't think you'll see much better rates than the ones you can find today. Contact me to discuss your options to and to make sure you don't miss out on the benefits of the current fiscal policies on homebuyers.

Record Housing Affordability: Take Advantage of Your Purchasing Power
 
Last year is a record-breaker when it comes to housing affordability, according to the National Association of Realtors [NAR]. Interest rates and home prices dropped dramatically, offsetting lower median incomes, which are the three factors considered in determining the affordability index.
 
But that's not expected to last; as interest rates creep up, and housing prices as well, we may not see an index this high for many years. Have you taken advantage of this perfect storm of factors to purchase a new property?
 
Whether you are looking at buying a larger or smaller home, investing in real estate, or even purchasing a second or retirement home, it's a great time to make your move, before the market changes and your purchasing power begins to drop.
 
Home Prices. Today's housing prices are astonishingly low. According to real estate website Trulia, buying a home in 2012 was even cheaper than renting in the largest U.S. cities. Prices did make modest gains over the course of the year, however, and though they remain very favorable, experts predict they will continue to slowly rise as the market improves. By acting now you can take advantage of prices that are still extremely low, maximizing your purchasing power.
 
Interest Rates. Not only are housing prices at historic lows, but interest rates have been, too. Rates for 30-year fixed loans have been in the 3-4% over the last several months. This is significantly lower than the historic average. The average rate for 30-year fixed rate loans over the last four decades has been 8.9 percent.
 
With rates this low, the smart buyer makes a move. The market can't sustain these numbers for long, and won't need to as it improves. Economists from the New York Federal Reserve have already stated that they don't expect mortgage rates to sink much lower than they have already.
 
Affordability and Purchasing Power. The affordability of housing during the first quarter of 2012 hit its highest level in the 20 years that the National Association of Home Builders and Wells Fargo have been tracking it in their joint Housing Opportunity Index (HOI). The combination of low rates and low housing prices has created an unprecedented opportunity for homebuyers to maximize their purchasing power. But the HOI did begin to drop over the course of 2012. Do you want to risk it lowering even more in 2013?
 
Every partial percentage point that rates rise will significantly lower your purchasing power. If you'd like to see some surprising numbers, let's set up a no-obligation meeting so I can show you the difference in purchasing power — and monthly payments — between 3.5% and 4%. You may find the motivation to begin the homebuying process right away!
 
Capitalize on the Current Market. Buying a home just isn't going to get much cheaper. You know your purchasing power is at its peak; delaying for even a few months can reduce the amount of home you can afford and raise the price you'll pay. If you are ready to capitalize on the current market's perfect storm of low rates plus low home prices, please contact me to set up a meeting to look at your options, review costs, and ensure you're maximizing your purchasing power. 

Thanks to many electronic devices, our lives have become safer, more comfortable, and more fun. Several trends in home electronics are taking off in 2013, with the overall motif being improvement on existing technologies rather than introducing entirely new devices.

 
Accessories. Accessories for your phone or tablet that work with downloaded apps are cropping up everywhere. Turn your device into a tool to monitor your heart rate and blood pressure. Family game night becomes an interactive learning experience, turning old-school board games like Monopoly into a new adventure. Digital "pets" learn to talk, require attention, and respond to your commands when you connect them to apps. Even Disney has introduced figurines that seem to come to life when paired with your electronic devices.
 
The Internet of Things [IoT]. If you haven't heard this term before, get ready to see it everywhere. IoT basically refers to the interconnectedness of things — from cars to phones to your refrigerator — to digital technology, the Internet and each other. Sensors allow machines to interact directly with one another, gathering information and communicating it to other machines or end users. This is as simple as your fridge letting you know when you're out of milk or your smartphone being able to wirelessly and instantly send a photo to a friend's phone. It's as complicated as self-steering vehicles and smart cities that monitor thousands of aspects of the lives of their inhabitants and create laws and policies based on the input gathered. Analysts predict that as IoT develops, "things" will create more Internet traffic than humans.
 
TVs. Ultra high definition televisions from Toshiba, Sony, and Sharp, among other well-known manufacturers, make your current high-def TV look like stone-age technology, although programming to fit this new format will lag behind. Sharper pictures and more vibrant colors are the big selling points. OLED technology allows large-screen TVs to be less then an inch in thickness and to use less power than most of today's available crop of televisions. In the future you may even be able to roll up your OLED and store it away. TVs are getting smarter too, with the ability to connect to more and more other household gadgets, and even to control lights and thermostats with your remote. Improvements to voice and gesture control can also be expected.
 
Phones. Bigger is apparently better. Screens are expected to grow on pretty much all available mobile devices. Wireless charging, downloading and sharing technologies are becoming easier to use and more widespread. Lots of plug-in gadgets are becoming available that turn your phone into other things, such as health monitors or gaming platforms. In addition, phones are expected to become the Internet access tool of choice this year, with more people using their phones to surf the Web than are using PCs, according to Gartner, Inc.
 
Computers. Touch screens are expected to become de rigueur this year. Your laptop and even desktops will be controllable through touch. You'll also be using the cloud for most of your storage needs, allowing you to access your personal information from any machine. To help you protect your data, innovations in cybersecurity are becoming more prevalent —and more critical. Midsize tablets, somewhere between the screen size of a smartphone and a full-size tablet, will try to become the new required digital device. Holographic displays may emerge on the scene this year, although they will probably be too pricey for most consumers.
 
Faster, bigger, and more connected are the watchwords for technology in 2013. Every year we see digital and computing innovations that change our lives in dramatic ways, most of them to our benefit. This year is no exception. We're looking forward to seeing which trends pan out and which flame out by year's end!

Email today is often viewed as the old reliable means of messaging. Mass communication was made simple with the advent of this technology and the world was made slightly smaller when we developed the ability send documents, images, and ideas instantly and securely. But don't dismiss email as an old-school form of communication: despite the advent of new technology and social media, it's still a reliable and effective method of making contact.
 
However, if you're still using email the same way you were 10 years ago, you're missing the boat on innovations in the way email can make your marketing simpler and more effective, saving you time and money. Instead of blanketing your entire database with a generic message, pinpointed and relevant information will give you a better ROI, more clickthroughs and a more loyal clientele.
 
Targeting
Any business owner who understands his clientele knows that creating targeted email messages for different kinds of clients is the most effective way to utilize this tool. MarketingSherpa's 2012 Email Marketing Benchmark Report notes a number of trends in email marketing: businesses expect a financial ROI from emails as they pour more money into this tool, with nearly a fifth of surveyed organizations increasing their budgets by 30%. Only 28% of businesses are sending relevant communications to segmented audiences — and this is a main goal of a majority of companies. It should be a goal for you, too, in 2013.
 
Segmenting Your Database
Dividing your database into categories may seem like a Herculean task. But there are many ways to divide up your contacts.

• Demographics: gender and age are big factors in the way recipients respond to email messages.
• Past actions: look at what contacts have done in the past to help predict their future needs.
• Sales cycle: your contacts will be at many different points in the sales cycle. Targeting messages for cold, warm and hot customers makes sense.

Using a combination of these criteria will help you ensure you're getting the right information to the right contact, increasing your value to them and instilling a sense of trust and loyalty.
 
Consider Consumption
How do people sort through the masses of emails they receive every day? How do you ensure your message doesn't get sent to the deleted items folder, unopened? Gmail offers a service called Priority Inbox, which allows recipients to mark messages as important or not important, and also looks at other factors to help them determine what they want to read. As this technology grows more sophisticated, email inboxes will "learn" their owners' preferences and become better at highlighting messages they will want to read, shunting less important communications to different folders to be looked at [or not!] at another time.
 
Grabby subject lines and high-quality graphics will help get your messages noticed, but the most critical factor a reader uses to decide whether to pay attention to your email is whether they offer relevant, timely, and useful information. By targeting your email communications, you can increase your open rates, lower your opt-outs, improve client retention and loyalty and generally raise your status in the eyes of your clients. You'll stop wasting their time — and yours.