FREE Credit Report

Don’t believe the so called free credit report ads on TV. The want your credit card number before sending you their “free report.” Then you discover that you have signed up for monthly reports that will cost you a lot of $$$$$$.

Did you know that you can get your credit report for free. Under the new Fair Credit Reporting Act, each of the nationwide consumer reporting companies is required
to provide you with a free copy of your credit report, at your request, once every 12 months.

The three nationwide consumer reporting companies — Equifax, Experian, and
Trans Union have set up a cooperative reporting center to manage credit report
requests nation wide. You can obtain your annual free credit report from a central location, by going to their website, calling the toll free number or writing direct.

Website: www.annualcreditreport.com
Telephone: 877-322-8228
Address: PO Box 105281, Atlanta, Georgia 30348

You may order your reports from each of the three nationwide consumer
reporting companies at the same time, or you can order from only one or two.

If you are asked if you want a copy of your CREDIT SCORE (FICO), you
should understand that this particular information is not free. There is a charge of $9 to $15 for each request.

To obtain a credit report you need to provide your name, address, Social Security number and date of birth. If you have moved in the last two years, you may have to provide your previous address. To maintain the security of your file, the consumer reporting company may ask you the amount of your monthly mortgage payment or for different private information

www.annualcreditreport.com is the only authorized source for your free credit report.
The nationwide consumer reporting companies will not send you an email or a letter asking for your personal information. If you get an email or see a pop-up ad on your computer claiming it’s from any of the three nationwide consumer reporting companies, do not reply or click on any link in the message — it’s probably a scam.

The Lowest Mortgage Rate Isn't Always The Best Deal

According to Kris Drake, a branch manager for Plaza Mortgage in Overland Park Kansas:

You are pre-approved, but are you getting the best loan for your money?

When it comes to choosing a mortgage, borrowers concerned with finding the lowest interest rate should understand that the mortgage of their dreams could turn into a nightmare.

Often borrowers miss the bigger picture. Closing costs that are far higher than estimated may outweigh what appears to be a break on the interest rate.

Once a transaction has begun, lenders are required to provide borrowers with a good-faith estimate (GFE), along with a truth-in-lending disclosure, within 72 hours. This estimate encompasses the interest rate, total amount of the mortgage, the terms of the mortgage and all fees required to close the transaction.

The problem is that both of these documents are estimates, not guarantees.

Scams abound and unscrupulous lenders have no intention of sticking to that GFE. So they happily quote a rock-bottom rate and may underestimate closing costs. A great “deal” on a mortgage rate is no deal at all if the transaction never closes, or if your closing costs outweigh the interest rate savings.

Imagine the borrower—armed with a pre-approval letter and having paid for an appraisal, credit reports and other documents—finding that the underwriter denied his loan the day before closing. The buyer can’t get the loan, and the seller, who was prepared to close on his new property the next day, is out of luck. Pre-approval and pre-qualifying are not guarantees. Only a lender’s commitment letter ensures that a full examination of income, credit and assets has been fully verified and the borrower will receive the loan.

We recently assisted an unsuspecting borrower who never got a GFE on the remarkably low interest rate offered to him by an unscrupulous lender, but he had accepted a verbal assurance that his closing costs would be $3,000. He got the shocking news at closing that the actual costs were $12,000. He was too embarrassed to complain to the BetterBusiness Bureau.

A qualified, reputable mortgage company will explain to a borrower that while it is permissible by law that the GFE disclose a range of costs on some items that cannot be precisely predicted, certain costs can be ascertained and noted as such. Mortgage companies should regularly review relevant costs so that their GFEs reflect current pricing of items such as appraisals, inspections and the like. A good faith estimate should be within $100 of actual expenses.

Before you make a mortgage choice:

• Determine the stability, size, history and reliability of the company you are dealing with. Check area newspapers’ lists of “top mortgage companies.” Check with your real estate agent to see if he or she has worked with the company before. Ask friends for a referral.

• Make sure any Internet lending company you work with provides you access to local brick-and-mortar and in-person service should questions arise. You want to make sure that you get immediate customer service when you call and that the company still exists when you are ready to close.

• Make sure you are getting the right mortgage product. Often, mortgage companies that have limited access to the newest products will place you in a product simply because they are able to sell it. If you then shop only that product around for the lowest rate, you may have missed out on other proprietary products that would have saved you more money each month and over the life of your loan.

• Plan to pay your closing costs up front, unless you are going to be in your house less than two years. If you wrap your closing costs into your interest rate, your interest rate will be higher.

• Be wary if your lender does not ask enough qualifying questions about your income, assets and credit history. Know the difference between being prequalified, being pre-approved, and having a commitment. Pre-qualification is based on undocumented information. Pre-approval is based on information that is documented and verified. A commitment is received when information is definitely documented, reviewed and approved by the underwriter.There still may be conditions on the commitment letter that require verification.

The Real Estate Settlement Procedures Act, or RESPA, requires lenders to disclose information to customers protecting the borrower from abuse. But borrowers must be cautious as well. You don’t want to pay an exorbitant price in the form of unforeseen closing costs just to save an eighth of a point on a home loan. A slightly higher monthly payment may be cheaper in the long run.

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Want to buy or sell a home on the Eastern Shore? Please visit our website. All the property listings are there.

Sailboats racing on the bay, wild geese covering the horizon, a plate of steamed crabs and a wonderful sense of colonial America … all combine to add a new dimension to your life and enhance your own Chesapeake Lifestyle!

The Chesapeake Bay Area

It all starts with water, not much, just a trickle from a spring or surface water from rain. The trickle joins many more to form a rivulet then a stream or brook, later a creek, perhaps a river, all forms of tributaries which feed into a major body of water – in this case the Chesapeake Bay which is fed by more than 150 rivers and creeks as well as thousands of minor tributaries.

Our bay is an estuary where fresh and tidal salt water mix. It is surrounded by a vast watershed of 64,000 square miles involving five states and the District of Columbia. The 190 mile long Chesapeake supports extraordinary ecosystems that support 3600 species of plants and animals and living in diverse habitats. With 12,000 miles of shore line, it’s no wonder, that the bay attracts more than a million wildfowl a year and hosts a major fish and shellfish industry, notably the blue crabs, oysters and striped bass.

The Chesapeake region provided a unique haven for early habitants, explorers, settlers from Great Britain and the Continent and presently it is a magnet for their many descendants along with thousands of others who are attracted to our “faire shores.”

It is no wonder that this region attracts so many visitors and seasonal home owners. Tidewater residents, both human and wildlife, have long realized that the Mid Shore is one of the finest places in America to call home.

Capital Gains and Taxes

It’s January—time to start thinking about taxes again. Here is a summary of the current rules regarding capital gain on personal residences and investment property. Taxation on the two is very different.

Personal Residence

The current rule permits individuals to exclude up to $250,000 of capital gain from taxation, and married couples filing jointly to exclude up to $500,000. Any amount of gain above these limitations would be taxed. The exemption can be taken per transaction. That means that the determination of whether or not the gain will be taxed is made at the time of sale.What the homeowner does next—buy a more expensive home, buy a less expensive home, or not buy at all—has no impact on the determination. The current rule does have the limitation, however, that the property must have been used as the taxpayer’s principal residence for at least two of the past five years. If that is not the case, it is recommended that the homeowner speak with an accountant to determine what tax implications the sale of their property may have.For full details, see IRS publication 523 “Selling Your Home,” at www.irs.gov/publications.

Income or Investment Property

It’s a different story for investors. When investors sell property, they pay taxes on capital gain. However, it is possible to sell rental property or land and not pay any capital gain taxes. How? Through Internal Revenue Code 1031, which states: No gain or loss shall be recognized on the exchange of property held for productive use in a trade or business or for investment if such property is exchanged solely for property of like kind which is to be held either for productive use in a trade or business or for investment. Exchanging property for property allows the tax to be deferred to later years. This gives investors a wide range of investment freedom. IRC 1031 Tax Deferral can range from transactions involving the simple trade of two properties to complex, multi-property exchanges. Contact your financial advisor to determine the exchange strategy that is best suited for your situation.

Dream Home May Be Affordable Today, But Not Tomorrow

Home Buyers Advised to Consider Effect of
Appreciation When Deciding Time to Buy

Homes in the United States continue to appreciate at a record pace—12.02 percent (from third quarter 2004 through third quarter 2005) according to a report by the Office of Federal Housing Enterprise Oversight. That’s music to the ears of the 68.3 percent of Americans who already own a home, but first-time home buyers may be watching the home of their dreams slip further from reach every year.

Home buyers tend to focus on mortgage interest rates and the size of the savings account they have established for their down payment when deciding the right time to buy. The impact of appreciation is not typically top of mind for home buyers, but it should be. Appreciation can have a significant financial impact on the home buyer’s pocketbook and their ability to purchase a home.

For example, a home for sale a year ago at $200,000 would cost $224,040 this year, based on the 12.02 percent average appreciation in the United States. That $24,040 hike in price not only makes a big difference over the life of a 30-year mortgage, but it also has an immediate impact on the wallet.

Assuming that mortgage interest rates remained steady at 6.5 percent, the homebuyer would need $4,808 more in savings to contribute to a 20 percent down payment. In addition, principal and interest on the monthly mortgage payment would increase by $121* per month.

With interest rates still historically low today, and with no end in sight to the trend of rising appreciation, we advise home buyers to jump into the market now. For most, it is the better financial decision, especially when prices are increasing at a faster pace than consumers can save.

CyberStars® Conference

Bob and Penny Hall of Champion Realty, Inc, were two of only 130 top real estate agents invited to attend The Allen F. Hainge CyberStar® Summit recently in San Antonio, TX. The nationally recognized CyberStar® Summit is an annual invitation-only networking and idea sharing conference open only to outstanding real estate agents from the US, Canada, Mexico, the Bahamas and Australia.

As leading members of the CyberStars®, Bob and Penny have long been market leaders on the Eastern Shore due to their commitment to serving customers and clients and their use of technology to meet the needs of today’s consumer. The Halls emphasis on their Web site www.ChesapeakeLifestyles.com as a top consumer resource and on using technology for effective communication and service has made them a unique success.

According to Bob and Penny attendance at the annual CyberStar® Summit provided many personal and professional benefits: Most importantly, we learned more about using the latest in today’s technology and successful strategies so that we can better serve our clientele and help them achieve a more successful home sale or purchase.

“Our clients are continually complimenting us on the service, tools and technology we use to meet their needs, and we owe that to our association with the CyberStars® and to the fact that we share among ourselves so freely.

Chesapeake Bay Real Estate

Over the years, Bob and Penny Hall have reached a conclusion. They love being near the water - any type of water - oceans, bays, rivers or waterfalls. They thrive on the serenity that accompanies the sound of water, whether it's waves breaking on the shore, a waterfall's hypnotic rhythm or a babbling brook.

The Halls know water is the critical element in so many procedures - gardening, cooking, and mixing everything from soup to sandcastles. It's the catalyst that makes things happen. Bob & Penny also know that adding water to your lifestyle can make a huge difference for you, too. Introducing you to the peacefulness of the Eastern Shore area of the Chesapeake Bay Region is a joy for this couple. Bob & Penny want to share the beauty and lifestyle available here.

Sailboats racing on the bay, wild geese covering the horizon, a plate of steamed crabs and a wonderful sense of colonial America … all combine to add a new dimension to your life and enhance your own Chesapeake Lifestyle!