Mortgage Lowdown

The American dream means different things to different people, but most can agree that it’s at the very least a free, safe and comfortable life. The ability to attain this dream has been fueled by the freedoms and industry of our country. Here’s how it all came to be.

Great Beginnings: A New Nation

After the American Revolution, American citizens were free to explore, invest and make their dreams come true. The American dream was very rich in this period of discovery, as many of America’s resources were unclaimed. These resources held the promise of land ownership and investment in land or industry. The country gave many an impoverished immigrant the opportunity to work themselves out of poverty to reach great heights.

Engines of Change: The American Industrial Revolution

The Industrial Revolution proved to be one of the biggest influences on the development of the American dream. As big businesses took root and expanded, new innovations and improved modes of production combined to greatly improve the American standard of living. During this period, there were many rags to riches stories that led to the belief that if you have talent and work hard, you have a good chance of living a successful life.

Civil War and Reconstruction

In 1865, as slavery was outlawed, more Americans had a chance at achieving the American dream. This period also saw the nation unified after a bloody Civil War that lasted four years. Following the Civil War, many Americans experienced difficulties in the changing economic landscape as the country rapidly moved towards industrialization. Many believed that the only way to achieve their shared American dream was through hard work.

World War I: Progressive Era

As the war raged across the world, there were equally momentous occurrences in the country as well. The economical and industrial boom during this period reshaped both urban and suburban life. The industrial revolution that had begun towards the end of the 19th century was sped up thanks to the war. Essentially, the war made the American dream a tangible reality for increasing numbers of Americans. It was the beginning of America’s backbone of economy and technological growth.

The Great Depression: Tough Times

The Great Depression was the longest and most severe economic downturn in American history. During this period, unemployment skyrocketed and reached levels as high as one third of the population. Crop prices crashed by half and hunger became a reality as food production became unprofitable. Severe unemployment was the order of the day with thousands and thousands of migrant farmers were now forced to travel the nation looking for jobs. Homelessness, poverty and a sense of hopelessness spread through much of the nation, making the American dream distant. 

World War II: Renewed Hope

For three decades following World War II, most people in the U.S. were on a positive high. The American dream was easily achievable, with some Americans going from rags to riches. During this period, all Americans could look forward to a steadily increasing standard of living and a better future for themselves and their children. Wages rose substantially, ensuring that most families could afford more. Education and a better standard of living became achievable dreams for millions. Perhaps most importantly, workers could retire and enjoy their life after decades of hard work.

The Modern Era

Currently, America is facing a crisis of economic disparity. Americans are achieving the dream bigger than ever before, as evidenced by people like Bill Gates and Oprah Winfrey, but there is an equal and opposite effect for America’s poor. As the rich get richer, many of the poor get poorer and America’s middle class has begun to erode. During the past three decades, most Americans have seen their living standards grow worse. Wages have stagnated or fallen, people who believed that their livelihoods were secure have received a pink slip and those who haven’t lost a job often find themselves working longer and harder than ever before.

The middle class dream of a home is also being eroded as the prices of homes and interest rates keep rising. It is possible for Americans to reclaim their dream, but perhaps the only way to do it is to relearn the importance of hard work and self-reliance: ethics that once embodied the American Dream.

Mortgages, refinancing and home equity loans are major financial transactions that are both confusing and important at the same time. There are a multitude of factors to consider: should you get a fixed rate or adjustable rate mortgage? Should it last 15, 30 or 40 years? How much money could you save on a refinance? And what about amortization? Use our 20 favorite home owner calculators to answer all of these questions and more.

1. Mortgage-calc.com: This site provides mortgage and home equity rates for primary and second loan refinancing. The online rate calculators on this site will help you evaluate interest rate options on all loans. You can even compare mortgage rates or home equity loan rates on this site. In addition to a simple mortgage calculator, the site also provides a ‘Rent vs. Buy’ calculator so you can choose the right option for you. While here, you can check your debt levels and how much time it will take you to pay it off with their debt calculators.

2. Bankrate.com: Bankrate.com not only provides immensely readable and useful financial articles, but it also has a few calculators which can be immensely valuable to home owners. You can use the fixed vs. adjustable rate mortgage calculator to calculate which will benefit you in the short and long-term. Their refinancing tool helps you determine if it makes sense to refinance your mortgage.

3. Online Loan Calculator: There are almost twenty financial calculations available on this site. Their loan calculator is a free tool which, when used appropriately, can help you get a better idea of where you stand financially. For instance, if you are considering a second home mortgage loan, the calculators on this site will help you decide if it is a wise decision. Once you have run all the numbers on the calculator, and are ready for the next step, the site provides a list of reputable loan brokers to help you find the right company that meets your needs.

4. Mortgagemath.com: Mortgagemath.com offers a collection of online mortgage calculators. You can access their home mortgage calculators that compare mortgage loans. The online calculators also evaluate amortization and loan payments for all types of mortgages including interest only mortgages, ARMs or 30-year fixed. These calculators help you compare the mortgage interest you’d be paying over the life of the loan. The site tries to combine fun with the tedious task of computing and comparing mortgage rates. Whether it is a decision to buy a home or refinance your existing one, these calculators help you make wise financial decisions and get the most out of your home.

5. Calculators4Mortgages.com: This aesthetically pleasing site offers calculators for amortization, loan comparison, refinance and early payoff. The site’s calculators help you find out what kind of mortgage works best for you: fixed rate or an adjustable rate mortgage. You can determine the amount of mortgage you can afford with the pre-qualify calculator and then move on to determine your new monthly mortgage payments. The refinance mortgage calculator helps you calculate payments on debt consolidation mortgage loan and see your monthly savings. These calculators make it easy to work out how much you can afford to borrow and exactly what your repayments will be using time scales and interest rates. Their amortization schedule allows you to find a payment plan that enables you to reduce your debt gradually through monthly payments of principal. Their mortgage calculators help you find out how much house you can afford and how much extra you’ll need to pay in your monthly mortgage payment to pay off the loan in the number of years you select.

6. Financial Calculators: At Homefair, you’ll find calculators to determine the cost of a mortgage. Whether you are relocating or looking for a home loan, Homefair has the tools and resources to help you every step of the way. In addition to helping you calculate your rates, the site also provides information on how the APR on your loan is calculated and the things you need to consider when looking for a house.

7. Karl’s Mortgage Calculator: This site helps you calculate mortgage repayments through graphical sliders and charts. You’ll need to have Java installed to chart your payments on this calculator. The prepayment section helps you estimate how you can shorten the term of your mortgage by making either a single one-off payment or continuous extra monthly or annual payments. There is a section devoted to calculating Adjustable Rate Mortgage loan rates. All you need to do is enter a start month to activate and click on the interest rate graph to view how this section alters the interest rates over the term of the mortgage.

8. Mortgage Loan Calculators: The site offers calculators for amortization payments, interest rates and financial calculations. The Mortgage Loan Calculator helps you generate an amortization schedule for your current mortgage. It shows you how much interest you will pay as well as your principal balance. You can even determine the impact of any principal prepayments! Press the report button for a full amortization schedule, either by year or by month. The Mortgage Qualifier calculator takes you through the process of finding out how much you can borrow, while the Mortgage Refinance Break Even aids you in finding out how long it will take to break even on a mortgage refinance.

9. Free Mortgage Analyzer: This mortgage amortization schedule calculator displays an amortization schedule, loan chart, graphs, and a mortgage payment table. It also calculates both total as well as real interest paid. The calculators provide an instant graphical display on loan amounts from one thousand to five hundred million dollars. You can make use of amortization charts and graphs for both US and Canadian mortgages. Options for monthly or bi-weekly payments are available with their innovative, java-enhanced calculator.

10. Mortgage Resources: Financial Calculators: Mortgage Resources provides you with calculators for every issue concerning real estate finance. The qualification calculator helps you approximate your qualification for a new home while the mortgage calculator provides you with an amortization schedule for a proposed transaction. The calculator even allows you to figure in regular prepayments. If you just want to calculate the payment on a mortgage loan, simply enter the amount, interest rate and loan duration into the Simple Loan Payment Calculator. If you have or are considering a 3, 5, 7 or 10-year balloon mortgage; the Convertible Balloon Mortgage calculator helps you understand the advantages and risks inherent in these programs.

11. Erate: Erate offers a multitude of mortgage calculators for both home buyers and home owners. The site bases its calculations on the sound reasoning that there are many ways to approach an affordability analysis. Hence, their mortgage calculators allow you to assess the effects of the different variables when buying or refinancing a home. The monthly mortgage payment calculator is one of the most useful and straightforward mortgage calculators available. It allows you to explore the outcome of changes to your loan balance, mortgage term, and interest rate on your monthly mortgage principal and interest payments. The refinance mortgage calculator allows you to explore the pros and cons of refinancing your mortgage while the qualifier calculator shows you how much income you need to buy a home, based on your mortgage payment and other factors.

12. (Re)Finance Center: This site provides a variety of mortgage and financial calculators as well as financial advice. The Calculators & Advice section helps you work out the financial implications of the important decisions in your life like buying a home or a car, refinancing your existing mortgage, and paying off your debt. In addition to calculators, the site has many useful articles and service providers all in one place. This makes it easy for you to learn everything you need to know about loans.

13. Distinctive Home Lending: Distinctive Home Lending provides several online mortgage calculators. The monthly payment calculator calculates your payment for different loan amounts, interest rates, and amortization terms while the payment schedule calculator computes the breakdown of principal and interest payments in a yearly or monthly format. In addition to these basic calculators, you can also check the Extra Payment calculator that, as the name suggests, helps you find out how much you can save over the term of your loan by increasing your monthly payment. You can also calculate your maximum mortgage amount based upon the monthly payment, interest rate, and term that you enter.

14. Coastal Financial Company: The site provides a variety of mortgage and financial calculators. The financial calculator on this site requires a browser with Java(TM) applet Support. The mortgage qualifier calculator takes you through the process of finding out how much you can borrow. All you need to do is fill in the entry fields and click on the ‘View Report’ button to see a complete amortization schedule of your mortgage payments. The simple mortgage calculator on this site is a no-frills application and helps you calculate your rates without any fuss. Other calculators include the Refinance Break-Even Point Calculator, and Early Payoff Calculator among others.

15. MyCalculators.com: Tired of online calculators that don’t seem to give you the right answers? Here’s one site that was created to correct this problem. The calculators were created with two basic intentions: to make them as accurate as possible and ensure that they are fast and easy to use. In addition to mortgage loan calculators, you’ll find calculators that compute your debt quotient, auto loans and many other loans. Examples that accompany each calculator guide you and show you some of the things you can do with them. If you have a Canadian mortgage, you can check the "Canadian" box under the Interest Rate field. The calculators take into account the fact that Canadian mortgages compound interest twice annually instead of monthly. Due to rounding, the calculations may differ by a few cents from those of your lending institution.

16. LoanLinks.com: This site helps you find the best loan in seconds in addition to providing you with online financial calculators to help compute your loan amounts. These easy to use calculators help you solve some common financial problems. For instance, the mortgage calculators help you decide if you should refinance your home mortgage as well as calculate payments for a fixed rate and adjustable rate loans. Other calculators help you find how much house you can qualify for and how much you can actually afford.

17. Vipps.com: The mortgage payment calculator at Vipps.com allows you to do mortgage payment and closing costs calculations. The calculator includes an analysis of mortgage refinancing. It includes an analysis of paying points to receive a lower interest rate. The calculator is formatted and runs in Microsoft Excel and provides you with information on your mortgage payment, closing costs, amortization, affordability, a what-if analysis, a refinance analysis, and paying points to receive a lower interest rate analysis. The site also includes a worksheet containing links to 25 real estate websites. However, this calculator doesn’t come free: you’ll have to shell out $15 if you want this detailed calculator.

18. Sksi.com: This site acts as a one-stop shop for everyone – it provides mortgage and loan calculators for realtors, lenders, brokers and consumers. In addition to free calculators that help you make an informed decision, the site also claims to provide information on the rules that mortgage companies use. In addition to the simple loan calculator, you can also check out the prepayment calculator, amortization table maker, qualifying calculator and payment calculator.

19. Dave.imarc.net: The PHP Mortgage Calculator can be used to calculate monthly payments of a home mortgage loan. The calculator takes into consideration Private Mortgage Insurance (PMI), taxes, and shows amortization of principal and interest. Property taxes and automatic calculation of PMI for loans where down payment is less than 20% are also factored into the monthly mortgage payment.

20. TimeValue Software: This one is not exactly for home owners but rather for real estate professionals. The easy-to-use Tcalc Financial Calculators from TimeValue Software (TVS) provides a list of mortgage, investment, lease, personal finance, and retirement planning calculators. The easy to use question and answer format, helpful charts and online graphing calculators assist you in your analysis.

What can you do when you just can’t find a home that’s right for you? Make one yourself! More and more homebuyers are opting to design their own dream homes. Of course, it’s not as easy as simply picking out a plot of land and getting to work. You’ll need to map out the interior, create landscape layouts, plan your budget and consider colors. We’ve complied 20 of the best resources that can help you figure out all of these details and get to work on your dream home.

1. Google Sketchup: Use this versatile 3D tool to design new models, help with the modeling of your kitchens, bathrooms and other areas of your home and plan your garden landscape. User friendly and simple to use, Version 6 of Sketchup allows you to upload your designs to Google Earth using real world coordinates and share them with others through Google’s 3D Warehouse. The site also provides video tutorials and user guides for those who need extra help.

2. Small Blue Printer: This online tool helps you with the blueprints for your home. You can either start from scratch or load an existing design and modify it according to your taste. You can view the isometric projection of your plan or take a 3-D walk around inside the walls you create. If you’re not able to stay connected to the Internet, there’s a smaller version of Small Blue Printer available to download and use on your PC.

3. Garden Planner: This online tool, as the name suggests, helps you plan your garden and makes designing your landscape a piece of cake. You can view an animated demonstration of how the software works before you start building your own design. A smaller file is available as a download if you prefer to work offline.

4. Envisioneer Express 3.0: Winner of a Users’ Choice award, this freeware allows you to create floor plans, 3D models and interior designs for your home. You can also display and review professional designs created with other software such as Cadsoft Envisioneer, 3D Home Architect Series, the Carey Bros 3D Deck and Landscape, IMAGINiT Builder 3D, the Home Depot 3D Home Designer, the Home Depot 3D Landscape Designer and CFM 3D Comfort Zone.

5. RSMeans QuickCost Estimator: The process of designing your house doesn’t just involve drawing plans and placing objects; there is no possibility of your design becoming a reality if you overshoot your budget. So before you start building based on your blueprint, make sure you’re well within your means with this calculator tool. It provides you with approximate costs for more than 50 building types across 930 locations in the United States and Canada.

6. 3D Kitchen Designer: Start at square one or use precooked prototypes to design your dream kitchen using this easy to use free online tool. Use it to create your floor plan before you put in the cabinets of your choice. Then add your appliances, doors, windows, sinks and countertops in the style and color of your choice. You can also use this resource to remodel an existing kitchen.

7. Design a Room: Use this online resource to design each room in your home. Select various types of room styles, then match your ceiling, floor colors and textures accordingly. Outfit kitchens with the cabinetry and appliances of your choice. You can enlarge your design or save them to your personalized product folder.

8. Patio Designer: Are you planning on adding a patio to your home? This is the perfect tool to help you with the design and layout. You can choose to add to three ready-made designs or create your own.

9. Resene EzyPaint: Before you splurge on paints for your house, you should explore the appearances that different colors provide. This virtual paint software helps you do just that. Compatible with both Mac and Windows operating systems, this tool includes a video to help you get started.

10. Arrange-a-Room: Not sure how you’re going to place all of your furniture in your new home? You don’t have to lug heavy chairs and couches back and forth to see how they’ll fit. Use Arrange-a-Room instead. Download the Shockwave plug-in and you’ll be set to go. Play around with your furniture layout in each room until it’s perfect for you.

11. See My Design: This interactive online tool helps you plan your design, select your interiors and choose the right paint colors. Plus, there are options to help you decide on the best floors and comfortable positioning of your lights.

12. Stock house plans: Unable to come up with a plan for your house? This website provides a list of plans for various styles of houses. The styles include a varying number of floors, different rooms and their dimensions all around. You can also alter the plans according to your specific needs.

13. Kohler Plumbing CAD Symbols: If you’re stumped by the plans for your bathrooms and kitchen, turn to Kohler Plumbing CAD Symbols. Download the 2D and 3D symbols for AutoCAD from their site.

14. SunAngle: If you want to do your part to help the environment, build an eco-friendly home. Use SunAngle to strategically use the power of the sun for heating in the winter and staying cool in the summer. Use their solar calculator to determine the angle of the sun’s rays according to location, time and date.

15. Dream Green Homes: Unable to figure out where to start when planning your environmentally friendly home? Your search stops here. Dream Green Homes provides users with sustainable plans and layouts for different styles of homes. You’ll consider the building materials used and the functions that the house will serve.

16. The Natural Home: This is a great resource to check out if you’re looking for information on sustainable home designing. Their information includes passive solar, zero-energy, high thermal mass and do it yourself solar house plans.

17. Building Cost: This site features a calculator that allows you to estimate the cost of building your home. The estimates are based on labor and materials used as well as the size, location and design of the house.

18. Paint Online: Choose your home’s model and experiment with colors of your choice for the exterior and interior.

19. Chief Architect: Use this tool to not only create your floor plans, elevations, cross sections and landscapes, but also to calculate the approximate cost of building your home. The trial version of this software is free.

20. The Complete Home Journal: More of a planner and organizer than design software, the trial version of this tool is free to use. It allows you to get your inventory under control, organize your project details and print out relevant reports. The trial versions are fully functional, but you won’t be able to save your plans.

Are you planning to sell your home, but not sure if you want to shell out thousands of dollars to hire a real estate agent? Don’t bother. Here are 10 ways to sell your home without having to share your profit with an agent. 

1. For Sale By Owner (FSBO): Stick a For Sale By Owner sign out on your yard to let prospective buyers know that your house is up for sale and that you’re in charge of the entire transaction. Get the word out by using these methods:

• Advertising in local newspapers or other media;
• Posting fliers in apartment complexes and various public locations around town;
• Informing friends, relatives and acquaintances that you’re selling your home;
• Hosting an open house in which buyers can walk in and look around your house on a predetermined day;
• Sending out details of your house to local real estate agents.

2. Sell to the highest bidder: Auction your home on the traditional chopping block or online with eBay. Put up attractive details, set your base price and let buyers battle it out to snap up your home. Use eBay or other auction websites like uBid and Bidz or register with traditional auction houses in your area.

3. Advertise inventively: Are tried and true methods not working? Go for wild and wacky, then! Throw a high-profile party in your home and be sure to mention to all attendees that the home they are having a great time in is for sale. Or, grab the attention of everyone that passes by: rent a billboard to advertise your house.

4. Sell using a lease option: Allow buyers plenty of time to decide if they are really ready to buy your home for keeps: let them lease your house with the option to buy when the lease has run out. This not only allows prospective buyers more time to decide on the house, but it also provides you with some income in the interim.

5. Sell on the Internet: Take advantage of the popularity of the Internet to offload your home. Advertise on various web pages with attractive pictures. This is a low cost option that allows you to reach buyers in locations outside of your metro area.

6. Get on TV: Staging is becoming the trendiest way to sell your house. Reality shows span all genres and the real estate world is no exception. This is evident in programs like Sell this House, Get it Sold, Designed to Sell, Take this House and Sell it, and Buy Me. They allow sellers to see buyers’ reactions to houses up for sale and provide them with small monetary amounts. They also offer sellers helpful suggestions from real estate, design and home improvement experts to enhance their home’s appeal.

7. Upload movies on the Internet: Sell your house by letting prospective buyers take a video tour. Shoot videos of the various rooms in your house and upload them on video sites on the Internet. Besides the ever-popular YouTube, you have options like JumpCut, Motionbox, Video Egg and Grouper.

8. Use social networking sites: Do you have a profile on Orkut or MySpace? Use your network to get the word out about the sale of your home. Post pictures and video, then get everyone you know to spread the news.

9. Sell with an MLS Listing: You may not be interested in using the services of an agent, but many buyers use on. Instead of a full listing service, use flat-fee MLS so that buyers and their agents are allowed access to details of your house.

10. Sell to a franchise company: If you’re in a hurry to sell and not horribly concerned about the price, franchise buyers are your best bet. They buy your home at below market price after conducting appraisals to determine a price for your house. If you need to get a house off of your hands in a hurry, contact a franchise buyer to see what they can offer you.

No matter how you plan to sell your home, take these tips into consideration:

• Prepare your home: clean up the exterior and make sure the interior is free of clutter. A well-maintained home is the best advertisement there is.
• Set your asking price after doing a small amount of research. Try and estimate the real value of your home by taking into account the prices of similar houses in the neighborhood. 
• Only consider offers from buyers who are pre-qualified for a mortgage.
• Make sure you have a good real estate attorney at hand to care of legal issues.
• Be prepared to handle the stress and tension of negotiations.

- By Mini Singh

Not long ago, home buyers were competing with one another and bidding way over the asking price to snatch up homes on the market. Just a few months and a bubble burst later, it is officially now a “buyer’s market.”

A few quick figures:

• The number of completed home sales dropped 12.7% from the same period a year before.
• The median price paid for a home dropped 1.2%, the first drop in home prices in many years.

All this means that people who were earlier closed out of the home buying market because of inflated prices driven by speculative investing (you didn’t think all those “house flippers” were bringing the price of homes DOWN did you?) can now afford to buy their own home.  But because so many new homebuyers have no previous experience in homebuying, we have compiled this list of 43 essential tips and resources for new home buyers:

YOUR PLAN OF ACTION

1. First things first — You need a budget if you ever hope to save for that home you want to own

The media, along with the illusion of abundance created by our credit cards have led to a culture where impulsive spending has become the norm. We don’t think twice about picking up that fancy outfit or those cool shades. And of course we have to have those latest CDs and DVDs. And we end up losing out on the opportunity to save for things that are really important — such as saving for that home we want to own.
Read this step-by-step article about budgeting basics.
And here’s a free Homebuyer Online Education Course.

2. Educate Yourself — Knowledge is Power

Use resources such as the U.S. Dept. of Housing and Urban Development’s (HUD) first time home buyer programs. “These programs are designed to help first time home buyers weigh the benefits of renting vs. buying. The programs teach first time home buyers about the different mortgage programs that are available, the value of a home inspection, and what to expect at closing, including calculating your closing costs.”

3. Know Your Rights

As a home buyer, and as a mortgage borrower, you have certain rights — don’t let anyone intimidate you into believing otherwise.  “You have the RIGHT to know the reason if your loan was turned down.” Read the complete list.

4. What Information must the Seller Provide Me With?

In most states, it is mandatory for the seller to provide you with the Real Estate Transfer Disclosure Statement. This is a pre-printed form that lists many features or conditions about the home, the land, and the area where the home is located.

After I had fallen in love with a house, my spouse enquired about any legal complications, and the seller promptly told us about the building violations that would definitely complicate the deal. He did not volunteer this information earlier, but did not withhold it once we asked. So ask questions anyway.

5. When is a Good Time to Buy? OR Should I Wait to Buy in a Down Market?

If you think you should wait for the market to go down before you buy that home, then you need to remember that it’s impossible to time the real estate market. It is wiser to make your home buying decision on factors other than your predictions of how the market will move. (American Home Guides)

Suppose you decide to wait - among other things, look at interest rates when taking the decision about waiting. “If interest rates are near an all-time low and beginning to inch upwards, waiting could cost you more than you would think. You might not be able to afford to buy a home at any price.”

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