How to Best Use your $8000 Tax Credit

Posted by JasonB on September 25, 2009

As the days tick off the calendar for the $8,000 First Time Homebuyers Tax Credit, many property virgins are busy scrambling to find a home and get a loan closed by the November 30 deadline date.  With exactly 68 days left to qualify, have you thought about what you’re going to do with your $8,000?

You can spend it. You have every right to get that latest gadget or take a much needed vacation.  But I have a better idea. Why don’t you maximize that $8,000 and make it work harder for YOU?  Consider these 4 ideas to get more out of your home and your tax credit.

1. Update the interior of your house, starting with one of the most critical aspects of any home – the kitchen.  When the words remodel and kitchen come together many people have visions of weeks of construction and never ending do it yourself projects that never seem to get completed. There are so many things that can be done! Even the simplest task like removing cabinet doors and repainting or refinishing them can breathe a new life into your kitchen. But keep in mind, every dollar put into remodeling your kitchen will earn you a higher return on your homes overall value.  Kitchens aren’t the only space to consider either, giving bathrooms and master suites a new modern look can really add value as well.
2. Curb appeal – Kitchen and bathrooms sell houses, but they’re of little help if the buyer doesn’t get past the front door.  A good first appearance on a home can add as much as 5 percent to 10 percent to the value of the home.  If you’re looking for modest updates, spruce up your yard by giving your door a fresh coat of paint, get rid of any brush and add a new layer of mulch for a more inviting yard.  If you’re looking to spend more, a nice large deck accented by professional landscaping can bring in a bigger value.  Though you may not get dollar for dollar if you go small, a larger 20 x 20 deck that is nicely shaded and freshly stained can easily add $3,000 – $4,000 to the value of your home.   
3. Pay off outstanding debt – The majority of American’s have them – Credit cards, medical bills, student loans, car payments, etc.  If you’re considering allocating your tax credit to your personal debt, the first place to start is with the highest interest rate.  The longer you take to pay off the debt, the more money it costs you – so get rid of it.  If you don’t have outstanding debt, consider rebuilding your “cash cushion” with your $8,000 tax credit – stick it in a savings account, long term CD, or even a money market.  Also, if you have children, $8,000 is a great start to your child’s college fund.
4.  Pay into your mortgage principle – Unfortunately, not many American’s are considering this one.  But what if I could tell you that you could more than double your $8,000 by paying into your mortgage principle?  Consider a $80,000 home loan at a fixed 5.5% for 30 years.  At the end of that 30 years you would have paid approximately $83,500 in interest, making the total amount paid for your home around $163,500.  Now, if you take your $8,000 and pay it into your mortgage principle a 5.5% fixed rate 30 year loan for $72,000 will come out to approximately $128,700 – saving you around $34,800.  Tell me how you else you can turn $8,000 into over $30,000?

Hopefully this blog has provided you with some guidance in how to make your $8,000 work best for you!  Keep visiting our blog for more up-to-date information on the First Time Homebuyers Tax Credit as well as other topics on Missouri Living!

IMPORTANT UPDATE:  As we look more into the First Time Homebuyers Tax Credit, we notice that there’s a lot of media talk about a possible extension.  According to US News and World Report, housing and real estate groups have been pushing Washington lawmakers to extend the tax credit for an extra six months.  As of today, no extension has been implemented, but a bill has been introduced.  We will continue to keep our eyes on Washington and keep you updated! Stay tuned folks!

Pests & Critters Coming This Fall

Posted by JasonB on September 24, 2009

The last thing we want to see in and around our homes are bugs and rodents.  As winter approaches, pests tend to seek warmer environments – making our homes a perfect shelter during the winter months.  When we begin to see these critters, we immediately think our only option is pulling out the pesticides and spraying down every nook and cranny of our homes.  But before you pull out the spray bottle, consider protecting your home before the pests have a chance of invading your space.

Since all pests come from outdoors, it may be wise to consider how they are getting in.  The perfect entry-ways for invasion are cracked foundation walls, leaks around windows and doors, vents, even under siding where exterior blemishes of your house are hidden.  Alongside maintaining the exterior of your home, fixing minor blemishes in your home’s foundation and exterior surface is a good start in pest prevention.  Another great prevention method is laying a plant-free rock bed that extends 2 to 4 feet out from the foundation of your home.  This essentially puts a barrier between the occasional invader and the structure of your house.  Organic material such as soil, leaves, mulch, bark and grass retain moisture which attracts pests.  It also provides an inviting source for food and shelter, making general yard maintenance a must.

Just like humans, bugs need air, water, food, and shelter for survival.  Once they get into your home, little things like leaky pipes, kitty litter, and plant debris are three main sources of survival for unwanted pests.  Start your pest prevention with fixing leaky pipes, the last thing you want is water to accumulate anywhere in or around your home.  Store food in sealed containers and clean up any “spills” from cooking.  If you store wood for the winter, refrain from storing it next to your house.  Wood attracts termites and carpenter ants that may eventually migrate to your home’s cozy warm, and very costly, wood framing. Also, emptying your garbage on a regular basis will help keep pests from finding environmental incentives for inhabiting your home. 

If you find yourself living with unwanted bugs and mice, consider these steps to pest management.

· Identify the pest problem. This is the first and most important step in pest control. Some pests are unmistakable. Cockroaches, Centipedes and mice are good examples. If you don’t know what kind of pest you’re dealing with, it may be best to catch a sample in a sealed container, stick it in your freezer, and immediately call a professional for an evaluation.  To make identification a little easier, MU Extensions has provided a great informational website about insects.  Visit their website for more information on bug resources.  They also offer an identification and information service for a minimal $15 dollar fee – information for shipment and submission can be found here.

 · Decide how much pest control is necessary and what is effective for eliminating the problem.  This decision may require the assistance of a professional.  Attempting to get rid of all pests inside and outside the home may lead to extensive and repeated chemical treatments that can often only be provided by a skilled professional.

· Evaluate the results. It is important when implementing a pest control method that you give it time to work. It is easier to prevent pests than to control them. The longer you delay prevention methods, the longer it will take to see results.