Plan To Sell Within 5 Years? Consider An Adjustable-Rate Mortgage.

Which is better -- a fixed-rate mortgage or an adjustable-rate mortgage? It's a common question among home buyers and refinancing households in california.

The answer? It depends. 

Fixed-rate mortgages give the certainty of a known, unchanging principal + interest payment for the life of the loan. This can help you with budget-setting and financial planning. Some homeowners say fixed-rate loans they offer "peace of mind".

Adjustable-rate mortgages do not.

After a pre-determined, introductory number of years, the initial interest rate on the note -- sometimes called a "teaser rate" -- moves up or down, depending on the existing market conditions. It then adjust again every 6 or 12 months thereafter until the loan is paid in full.

ARMs can adjust higher or lower so they are necessarily unpredictable long-term. However, if you can be comfortable with uncertainty like that, you're often rewarded with a very low initial interest rate -- much lower than a comparable fixed rate loan, anyway.

Freddie Mac's weekly mortgage survey highlights this point.

The interest rate gap between fixed-rate mortgages and adjustable-rate mortgages is growing. It peaked 2 weeks ago, but remains huge at 1.16 percentage points.

On a $200,000 home loan, this 1.16 FRM/ARM spread yields a monthly principal + interest payment difference of $136, or $8,160 over 5 years, the typical initial teaser rate period.

Savings like that can be compelling and may push you toward an adjustable rate loan.

You might also consider a 5-year ARM over a fixed-rate loan if any of these scenarios apply:

1. You're buying a new home with the intent to sell it within 5 years
2. You're currently financed with a 30-year fixed mortgage and have plans to sell the home within 5 years
3. You're interested in low payments, and are comfortable with longer-term payment uncertainty

Furthermore, homeowners whose existing ARMs are due for adjustment might want to refinance into a brand new ARM, if only to push the teaser rate period farther into the future.

Before choosing ARM over fixed, though, make sure you speak with your loan officer about how adjustable rate mortgages work, and their near- and long-term risks. The payment savings may be tempting, but with an ARM, the payments are never permanent.

How To Clean A Gas Grill

Whether you barbecue for friends or family once annually, or through all 4 san jose seasons, it's important to keep a clean gas grill. A well-maintained grill will help your food taste its best -- no matter what you're cooking up.

Cleaning a gas grill is simple and should be performed at least once every 12 months for light use, and once every 6 months for heavy use. You'll need the following tools:

1. A drop cloth
2. Aluminum foil
3. A regular scrub brush plus a wire brush
4. An active garden hose
5. Dish detergent
6. A soft sponge
7. A bucket
8. Rubber gloves

With these tools in-hand, follow these basic steps.

First, disconnect the propane tank and move the grill onto the drop cloth. Open the grill and remove its grates and the flame guards (the v-shaped metal pieces on top of the burners). Then, disconnect the igniters and remove the burners. Soak the grates in hot water if they're excessively dirty.

Set the pieces aside for cleaning.

Next, clean out any loose debris from the bottom of the grill. Use the detergent to make a soapy mixture and scrub the bottom of the grill, including its grill pans and grease trays. Clean the grates at this time, too.

Gently brush the outside of the burners with the wire brush, then allow running water from the garden hose to flow through the tubes to clean out the insides. If the burners appear to be cracked, replace them according to the grill manufacturer's instructions.

Allow all of the above cleaned pieces to air dry, then reassemble the grill.

Next, clean the outside of the grill using a soapy mixture and a soft sponge, treating early-stage corrosion with some cooking oil applied like car wax. If your grill has a stainless steel exterior, wipe with the grain to minimize streaking. And that's it!

Cleaning a gas grill can be time-consuming, but better tasting food is worth it. Plus, your grill will last longer.

How Does Your Work Commute Compare To Other Cities?

As part of the Census Bureau's data collection activities from 2005-2009, a number of interesting charts have been published at http://census.gov.

The data should not be confused with Census 2010 -- a separate survey conducted every 10 years. This is the first-ever, 5-year American Community Survey. Based on data from 3 million households, it details social, economic, housing, and demographic data "for every community in the nation".

Among the surveys:

• Median Household Income, Inflation-Adjusted To 2009 Dollars (Chart)
• Median Housing Value Of Owner-Occupied Housing Units (Chart)
• Percent Of Households That Are Married, With Children Under 18 (Chart)

The ACS survey also charts average commute time by county. The chart is shown at top.

Whether you live in a "long commute" town like Richmond, NY (40 minutes), or a "short commute" town like King, TX (3.4 minutes), rising gas prices have made commute times and distances relevant to everyone.

Since the start of 2011, the average price for gasoline is higher by 54 cents per gallon. Assuming 22 miles per gallon on a passenger car, that's an increase of 2.5 cents of gasoline per mile driven in the last 90 days. It's a cost that adds up quickly, and can affect a household budget. Plan for higher pump prices moving forward, too. Historically, gas prices surge between April and June.

The American Community Survey is loaded with charts and data. It can tell you a lot about your current neighborhood, and any neighborhood to which you may want to relocate. Then, to bridge the ACS data with community details such as school performance and typical home prices, talk to a real estate professional.

January 2011 Case-Shiller Index : Weak And Flawed

Standard & Poors released its Case-Shiller Index for the month of January this week. The index is a home valuation tool, measuring the monthly and annual changes in home prices in select cities nationwide.

January's Case-Shiller Index gave a poor showing. As compared to December 2010, home values dropped in 19 of the Case-Shiller Index's 20 tracked markets. Only Washington, D.C. gained. The results were only modestly better on an annual basis, too.

18 of 20 markets worsened in the 12 months ending January 2011.

According to the report, values are down 3.1% from last year, retreating to the same levels from Summer 2003. As a buyer or seller in today's market, though, don't read too much into it. The Case-Shiller Index is far too flawed to be the final word in housing.

The index has 3 main flaws, in fact.

The first flaw is the Case-Shiller Index's lack of breadth. The report is positioned as a national index, but its data is sourced from just 20 cities nationwide.

Putting that number in perspective: the Case-Shiller Index tracks home values from fewer than 1% of the 3,100 U.S. municipalities -- yet still calls the report a "U.S. Average".

A second flaw in the Case-Shiller Index is how it measures home price changes, specifically. Because the index only considers "repeat sales" of the same home in its calculations, and only tracks single-family, detached property, it doesn't capture the "full" U.S. market. Condominiums, multi-family homes, and new construction are ignored in the Case-Shiller Index algorithm. 

In some regions, homes of these excluded types represent a large percentage of the market.

And, lastly, the Case-Shiller Index is flawed because of the amount of time required to release it.

Today, it's almost April and we're talking about closed home resales from January which is really comprised of homes that went under contract in October -- close to 6 months ago. Sales prices from 6 months ago is of little value to today's san jose home buyer, of course.

The Case-Shiller Index can be a helpful tool for economists and policy-makers trying to make sense of the broader housing market, but it tends to fail for individuals like you and me. When you want accurate, real-time housing figures for your local market, talk to your real estate professional instead.

Lock Now? Friday's Job Report Expected To Push Mortgage Rates Up.

Friday is a pivotal day for mortgage markets and conforming mortgage rates across california. At 8:30 AM ET, the government will release its March Non-Farm Payrolls report.

More commonly known as "the jobs report", the monthly Non-Farm Payrolls is a market-mover and home buyers would do well to pay attention. Depending on the report's strength, mortgage rates could rise, or fall, by a measurable amount tomorrow morning.

It's because so much of the today's mortgage market is tied to the economy, and economic growth is dependant on job growth.

With more job growth, there's more consumer spending and consumer spending accounts for the majority of the U.S. economy. Additionally, it generates more payroll taxes to local, state and federal governments. This, too, puts the broader economy on more solid footing.

Between 2008 and 2009, the economy shed 7 million jobs. It has since recovered 1.5 million of them. Friday, analysts expect to count another 190,000 jobs created. If the actual figure falls short, expect mortgage rates to ease.

Otherwise, look for rates to rise. Probably by a lot.

If you're shopping for a mortgage right now, consider your personal risk tolerance. Once the BLS releases its data, it will be too late to lock in at today's interest rates. If the idea of rising mortgage rates makes you nervous, execute your rate lock today instead.

On a 30-year fixed rate loan, each 1/8 percent increase to rates adds roughly $7 per $100,000 borrowed.

Pending Home Sales Rebound; Suggest Brighter Spring For Housing

On a seasonally-adjusted basis, the Pending Home Sales Index rose 2 percent last month, according to the National Association of REALTORS®. A "pending home sale" is defined as a home under contract to sell, but not yet closed.

February's Pending Home Sales Index rebound breaks a 2-month losing streak, and reverses the recent downward momentum in housing. Both Existing Home Sales and New Home Sales volume showed a sizable loss last month. 

For buyers and sellers of real estate in san jose , the Pending Home Sales Index is of particular import. It's one of the few forward-looking indicators in housing, and February's data suggests a stronger spring season than was the winter.

Region-by-region, Pending Home Sales data varied:

• Northeast Region: -10.9%
• Midwest Region : +4.0%
• South Region : +2.7%
• West Region : +7.0%

3 of 4 regions showed marked improvement, which is good for housing. In the fourth -- New England -- it's likely that inclement weather hampered results.

February was colder-than-normal and the month capped a record-breaking snowfall season for the region. Anecdotally, fewer homes are sold in the cold-and-snow of winter and it's likely that the weather affected local housing markets.

Looking to March and April, therefore, we should expect Existing Home Sales data to rebound. This is because 80% of "pending" homes close within 60 days, and because improving weather should release pent-up demand for housing.

More sales plus higher home demand tends to lead home prices higher. If you're in the market for a new home, consider that your best negotiation leverage comes in a weak market. As the seasons turn, your leverage looks poised to slip.

The best time to buy this year may be right now.

Water Conservation Tips For Your Home And Garden

 

According to the EPA, the average U.S. household spends close to $500 each year on water and sewage bills. But by making just a few small changes, that figure could drop by as much as $170 annually. It's all in how you use your water.

In this 4-minute video from Lowe's, you'll learn basic water conservation techniques that you can immediately put to work.. 

Some examples:

• Don't rinse food from dishes before putting them in a dishwasher. Scrape the dishes instead.
• When brushing your teeth or shaving, turn off the water at the sink.
• Use a rain barrel to capture rain, then use the rain to water plants and shrubs.

There's a host of tips in the video but the recurring theme is that you should never "leave water running". This is because water at home is "treated" water and the amount of energy required to treat 5 minutes' worth of water from a faucet is equivalent to the amount of energy required to run a 60-watt light bulb for 14 hours.

That's a lot of energy.

Water is a precious resource, and it can be expensive, too. Therefore, help the environment and your budget at the same time -- practice water conservation at home.