Daily Crunch Bookkeeping Services

I am Jill, the owner of The Daily Crunch Bookkeeping Services, dedicated to providing tailored bookkeeping solutions that empower small business owners.  My mission revolves around helping entrepreneurs regain their most precious resource – time.

 

Drawing from my previous experience as a business owner myself, I deeply understand the unwavering commitment and time investment required for business success.  Navigating the intricacies of business management can be challenging, often leaving essential areas overlooked.  My commitment is to offer high-quality bookkeeping services that not only ensure financial accuracy, but also allow companies to concentrate on core elements such as business strategy, marketing, sales and overall development. 

 

I invite you to explore the possibilities of partnering with me to create the necessary space for you to pursue all your business aspirations, while maintaining a strong foundation of financial stability.

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Here Are A Few Examples Of New Loan Programs Available

 

• Down Payment Assistance Available up to $161,000.00 that can be used for Down Payment, Closing Cost and Acquisition 
• Clients put down 1% and our partner lender will cover the other 2%. You get all the benefits of a 3% down-payment loan and save big since they don't have to pay mortgage insurance.
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• DSCR loans are specifically tailored for real estate investors seeking mortgage qualification based on the cash flow generated by their investment property.
• Stated Income 2nd Loans up to 65% L.T.V. for Owner / Non-Owner
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Thanks For The Continued Support, 25+ Years and Counting. 

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Value Added Article Links

Stop Believin’! 4 Housing Market Myths Hurting Today’s Buyers and Sellers

Is your credit score accurate? What you need to know, plus how to check it

Applying for a Mortgage? Here Are 5 Hacks to Improve Your Credit Score

Huge Discount on Your House if You Work in One of These Professions

How to Make Sure You Don’t Fall out of Escrow—Buyer’s Version

How to Make Sure Your Home Closes Escrow—Seller’s Version

First-Time Homebuyer Programs to Help You Afford a Mortgage

Just How Accurate Are Those Online Home Value Estimates

Got Cold Feet About Homebuying? Here’s How to Cope

FHA vs. Conventional Loan: Which is Right for You?

Comparing a Pre-Approval and Pre-Underwriting

Home Equity Lending Significantly Increased

Cash-Out Refinance vs. A Home Equity Loan

Capital Gains Tax When You Sell Property 

Got A Real Estate / Mortgage Question? Do You Need a Trusted Nationwide Referral? 

Email us at Info@EstatesByTheBeach.Com 

We Look Forward To Earning Your Referrals, Not Just Your Business. 

Thanks For The Continued Support, 25+ Years and Counting. 

Estates Has Made A Big Move By Adding Patrick Aguiluz To Our Team

 

"Success Is A Team Sport"

Patrick was valedictorian of his undergrad, not because he was the smartest student, but because he helped each of his classmates thrive.

Mr. Aguiluz is blessed with a helper's heart and some amazing skills that allow him to excel in any industry. Patrick now focuses on the financial services because he knows it's the best way for him to truly be of help to others. 

Patrick Aguiluz, D Capital Mortgage

Executive Vice President, MBA

NMLS 2310779  |  DRE 01855572  |  Company NMLS 1537000

Got A Real Estate / Mortgage Question? Do You Need a Trusted Nationwide Referral? 

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Mortgage Interest Rate Deduction: What Qualifies for 2023

You might be able to deduct mortgage interest on your taxes if you itemize and follow a few other guidelines.

What is the mortgage interest deduction?

The mortgage interest deduction is a tax deduction for mortgage interest paid on the first $750,000 of mortgage debt. Homeowners who bought houses before December 16, 2017, can deduct interest on the first $1 million of the mortgage. Claiming the mortgage interest deduction requires itemizing on your tax return.

Here’s a look at how it works and how you can save money at tax time.

How the mortgage interest deduction works

The mortgage interest deduction allows you to reduce your taxable income by the amount of money you've paid in mortgage interest during the year. So if you have a mortgage, keep good records — the interest you’re paying on your home loan could help cut your tax bill.

As noted, in general, you can deduct the mortgage interest you paid during the tax year on the first $750,000 ($375,000 if married filing separately) of your mortgage debt for your primary home or a second home. If you bought the house before December 16, 2017, you can deduct the interest you paid during the year on the first $1 million of the mortgage ($500,000 if married filing separately).

For example, if you got an $800,000 mortgage to buy a house in 2017, and you paid $25,000 in interest on that loan during 2022, you probably can deduct all $25,000 of that mortgage interest on your tax return. However, if you got an $800,000 mortgage in 2022, that deduction might be a little smaller. That's because the 2017 Tax Cuts and Jobs Act limited the deduction to the interest on the first $750,000 of a mortgage.

There’s an exception to that December 15, 2017, cutoff: If you entered into a written binding contract before that date to close before Jan. 1, 2018, and you closed on the house before April 1, 2018, the IRS considers your mortgage to be obtained prior to Dec. 16, 2017. 

What qualifies as mortgage interest?

IRS Publication 936 has all the details, but here’s the list in a nutshell.

• Interest on a mortgage for your main home
• The property can be a house, co-op, apartment, condo, mobile home, house trailer or a houseboat.
• The home has to be collateral for the loan.
• The home must have sleeping, cooking and toilet facilities to count.
• If you get a nontaxable housing allowance from the military or through the ministry, you can still deduct your home mortgage interest.
• A mortgage that you get in order to “buy out” your ex’s half of the house in a divorce counts.

Interest on a mortgage for your second home

• You don’t have to use the home during the year.
• The house has to be collateral for the loan.
• If you rent out the second home, you have to be there for the longer of at least 14 days or more than 10% of the number of days you rented it out.

Points you paid on your mortgage

• Points are a form of prepaid interest on your loan. You can deduct points little by little over the life of a mortgage, or you can deduct them all at once if you meet every one of nine requirements.
• In general, the nine requirements are that the mortgage has to be for your main home, paying points is an established practice in your area, the points aren’t unusually high, you use the cash method of accounting when you do your taxes, the points aren’t for closing costs, your down payment is higher than the points, the points are computed as a percentage of your loan, the points are on your settlement statement and the points weren't paid in place of amounts shown separately on the settlement statement, such as appraisal, inspection, title, or attorney fees or property taxes.

Late payment charges on a mortgage payment

• You can deduct a late payment charge if it wasn't for a specific service performed in connection with your mortgage loan.

Prepayment penalties

• You may face a penalty for paying off your mortgage early, but you may also be able to deduct the penalty as interest.

Interest on a home equity loan

• You have to use the money from the home equity loan to buy, build or “substantially improve” your home.
• If you use the money to buy a car, pay down credit card debt, or pay for something else not home-related, the interest isn’t deductible (learn more about deducting home equity loan interest).

What’s not deductible

• Homeowners insurance.
• Extra principal payments you make on your mortgage.
• Title insurance.
• Settlement costs (most of the time).
• Deposits, down payments or earnest money that you forfeited.
• Interest accrued on a reverse mortgage.
• Mortgage insurance premiums.

How to claim the mortgage interest deduction

You’ll need to take the following steps.

1. Look in your mailbox for Form 1098. Your mortgage lender sends you a Form 1098 in January or early February. It details how much you paid in mortgage interest and points during the tax year. Your lender sends a copy of that 1098 to the IRS, which will try to match it up to what you report on your tax return.

• You will get a 1098 if you paid $600 or more of mortgage interest (including points) during the year to the lender. (Learn more about Form 1098 here.) You may also be able to get year-to-date mortgage interest information from your lender’s monthly bank statements.

2. Keep good records. The good news is that you may be able to deduct mortgage interest in the situations below under certain circumstances:

• You used part of the house as a home office (you may need to fill out a Schedule C and claim even more deductions).
• You were a co-op apartment owner.
• You rented out part of your home.
• The home was a timeshare.
• Part of the house was under construction during the year.
• You used part of the mortgage proceeds to pay down debt, invest in a business or do something unrelated to buying a house.
• Your home was destroyed during the year.
• You were divorced or separated and you or your ex has to pay the mortgage on a home you both own (the interest might actually be deemed alimony).
• You and someone who is not your spouse were liable for and paid mortgage interest on your house
• The bad news is that the rules get more complex. Check IRS Publication 936 for the details, or consult a qualified tax pro. Be sure to keep records of the square footage involved, as well as what income and expenses are attributable to certain parts of the house.

3. Itemize on your taxes. You claim the mortgage interest deduction on Schedule A of Form 1040, which means you'll need to itemize instead of take the standard deduction when you do your taxes.

• That can also mean spending more time on tax prep, but if your standard deduction is less than your itemized deductions, you should itemize and save money anyway. If your standard deduction is more than your itemized deductions (including your mortgage interest deduction), take the standard deduction and save yourself some time. (Read more about itemizing versus taking the standard deduction.)
• Schedule A allows you to do the math to calculate your deduction. Your tax software can walk you through the steps.

4. See if you qualify for special deduction rules. If you got help from a state housing finance agency

• “Hardest Hit Fund” program or an Emergency Homeowners’ Loan Program (the state or the Department of Housing and Urban Development administers that), you may be able to deduct all of the payments you made on your mortgage during the year.

By Tina Orem

Original Post 

Got A Real Estate / Mortgage Question? Do You Need a Trusted Nationwide Referral? 

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Home Equity Lending Significantly Increased

Home-equity lines of credit or HELOCs and closed-end home equity loans increased by a massive 50% in 2022 compared to 2020, based on data from the Home Equity Lending Study by the Mortgage Bankers Association.

Marina Walsh, the VP of Industry Analysis for the Mortgage Bankers Association, attributes this increase to remodeling and home renovation projects. In 2022, around two-thirds of these borrowers said it was why they applied for a home equity loan. Other reasons named were debt consolidation and tapping into emergency cash reserves.

The shortage of housing inventory and high home prices are making home renovations appealing compared to trying to buy a new home and leave a mortgage with a much lower rate. HELOCs or home equity loans are also a good way to cover the costs of a home project, but you can get a tax advantage by deducting mortgage interest.

Walsh went on to say that with almost $30 trillion in accumulated real estate equity, there's potential for lenders and borrowers.

Some of the key findings from the study include:

• The average HELOC commitment volume, or the total credit offered, was $2.4 billion per company in 2022, representing a 41% increase from 2020.
• The dollar volume of outstanding balances on HELOCs compared to the maximum credit availability increased in 2022.
• HELOC utilization in terms of dollar volume was 34% in 2022, compared to 40% in 2020.
• There was a shift in the average credit profile of HELOC borrowers in 2022. The average FICO score dropped from 780 in 2020 to 769 in 2022.
• Annually, lenders anticipate HELOC's outstanding debt will increase by 8.2% this year and nearly 10% in 2024.

Data related to home equity loans include:

• From 2020 there was a 166% increase in average home equity loan originations per repeater company.
• The weighted average outstanding balance on home equity loans went up to $61,114 by the end of the year from $52,653 at the start.
• The average FICO score for home equity loan borrowers dropped to 752 in 2022 from 768 in 2020.

Home equity loans are a way to get money when your assets are tied up in your property. They tend to have lower interest rates than most other kinds of consumer loans because they're backed by your home, like your main mortgage. You use the equity you've built up in your home as a source of collateral to borrow money, and these products are often referred to as second mortgages because you have to make another loan payment in addition to what you pay on your primary mortgage.

In the case of a home equity loan, you receive a large payment as a lump sum, and you pay it back in fixed installments over a predetermined time period. They're usually fixed-rate. The pros of home equity loans include easier qualification standards, lower fixed interest rates, and longer terms than most consumer loans. There aren't restrictions on how you use the funds, and you can access all the money simultaneously. Plus, since your monthly payments are fixed, your spending is predictable.

The downsides include having another mortgage, and if you default on the loan, you risk foreclosure. Additionally, if you were to sell your home, you'd have to pay off the balance of the home equity loan and your primary mortgage at closing.

A HELOC is more like a credit card. You have an amount up to which you can borrow and pay back, but you use only what you need, and you're only paying interest on what you draw. A HELOC may start with a lower initial interest rate than a home equity loan, but it's a variable or adjustable rate, so it can go up or down depending on the benchmark. That means your payments aren't predictable—they can go up or down too.

With home prices not looking to decline in any significant way any time soon and interest rates continuing to rise, many homeowners have plans to stay put for the foreseeable future, so both types of financial products may continue to be a popular options to make your home suited to your needs, rather than shopping for a new one.

WRITTEN BY ASHLEY SUTPHIN

Original Post

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FHA vs. Conventional Loan: Which is Right for You?

When you feel ready to buy a house, different types of loans may be available to you. Two primary mortgage options are an FHA loan and a conventional loan. Below, we briefly compare each to help you understand which might be right for your situation.

What is an FHA Loan?

The Federal  Housing Administration insures FHA loans. The government-backed loans have less stringent borrowing qualifications. Some people go with this type of loan if they don’t have a big down payment or they have a lower credit score.

What is a Conventional Loan?

Conventional loans aren’t issued, nor are they guaranteed by a government agency. Private lenders insure these loans. You’ll need a better credit score and lower debt-to-income ratio to qualify for a conventional loan, as well as a down payment of usually at least 20%.

A conventional loan is also known as a conforming loan because they conform to standards set by Fannie Mae and Freddie Mac. These groups buy mortgages from lenders, holding them or turning them into mortgage-backed securities.

You can opt for a conventional loan with a fixed rate interest rate or an adjustable rate. The terms of a conventional loan usually range from 10 to 30 years, with 15 and 30-year mortgages being the most common.

Below, we look more comprehensively at some of the differences between these two primary home loan types.

Credit Score

Your credit score is three digits, and it can be anything from poor to excellent. According to most lenders, a poor score is anywhere from 350 to 570, with an excellent score being anything 800 and above.

The bulk of lenders will look at the FICO Score. The FICO Score is a credit scoring model created by the Fair Isaac Corporation. There’s also the VantageScore model.

Three credit bureaus report credit scores: Experian, Equifax, and TransUnion. Your scores can vary between the three.

Credit score depends on your history of making on-time payments, your mix of types of credit, how long your credit history is, and how you use your credit.

Most lenders require that you have at least a 620 to qualify for a conventional loan but generally like to see scores higher than this. For an FHA loan, you can qualify with a score as low as 500 because there’s less risk for the lender since the government backs the loan.

The lower your score, the more of a down payment you have to put down.

Down Payment

A 20% down payment is usually the standard for a conventional loan. Not everyone has 20% down for a house, though. You don’t have to put this much of a down payment on a house, but with a conventional loan, if you don’t, you’ll have to pay for private mortgage insurance or PMI.

To get an FHA loan, if you have a credit score that is at least 580, your down payment can be as small as 3.5%. If your score ranges from 500 to 579, you have to put 10% down.

Interest Rates

Several key factors influence mortgage interest rates, including demand, the condition of the economy, and the Federal Reserve. Lenders also look at your financial history, how much you’re borrowing, and your down payment when deciding on your interest rate.

If you want lower interest rates, you pay lender discount points. Then you can have a lower monthly payment.

The FHA interest rates are often comparable with conventional mortgages and based on similar factors.

Loan Limit

This year, the conventional loan limit in the lower 48 states is $647,200. In Alaska and Hawaii, it’s $970,800. In high-cost areas, it’s also $970,880. Someone who wants to get a loan that’s more than these limits would have to get a jumbo loan.

Jumbo loans are non-conforming because Fannie Me and Freddie Mac don’t back them. The underwriting guidelines are stricter, and they’re harder to get.

For an FHA loan, the limit depends on where you’re buying. The upper limit in counties considered low-cost is $420,680. In the high-cost county, the highest limit is $970,800.

A conventional loan tends to make the most sense for people who have a credit score of a minimum of 620, a down payment of at least 20% to avoid PMI, and a low debt-to-income ratio. An FHA loan might be good for a borrower who doesn’t have a high credit score, has a higher DTI, or has less money available for a down payment.

WRITTEN BY ASHLEY SUTPHIN

Original Post

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