Are You Ready to Begin Planning for a New Home?

Do you think you're ready to buy a new home? We'll help you plan your course of action, starting with learning about becoming a homeowner. We will enable you, a would-be buyer, to set realistic expectations and a plan of action.

Effective planning lays the essential groundwork for a successful home purchase. First you need to answer these questions for yourself: Can I really buy a new home? Am I ready?

Tax Breaks!
If you're a first-time buyer who's wondering, "Hey, what's in it for me, besides a big down payment and 30 years of monthly mortgage payments?" The answer is: tax breaks! Three major items are deductible from your income taxes:

• mortgage loan interest, including any late fees
• purchase points, also known as loan origination fees
• property taxes

These are substantial tax deductions. Just the mortgage interest alone is a hefty, annual tax break.

A hypothetical homebuyer, who takes out a 30-year loan for $120,000 at 7.5 percent interest, pays $8,957 in mortgage interest the first year. That's a potential tax deduction of nearly $9,000.

You also might be eligible to deduct the purchase points for the year of your purchase. One point is equal to one percent of the loan amount, in this case $1,200. The only things you can't deduct are your homeowner insurance, loan processing fees, or private mortgage Insurance (PMI). If you don't itemize on your tax return now, and your home deductions exceed the 1999 standard deduction of $7,200 for married couples filing together or $4,300 for single filers, then there may be strong motivation for you to own a home from a tax standpoint.

You can also factor in non-home related deductions, such as charitable contributions, state income taxes and other deductions available to people who itemize.

So, you can see clearly that tax laws are structured to benefit homeowners.

That's the best news of owning.

Other Benefits

The other benefits aren't things to sneeze at either. For example:

• You have your own castle, and being King or Queen of your castle is worth something.
• Nothing beats putting your feet up and thinking, "I own this place." You can't put a price on the feelings of satisfaction and permanence that come from owning your own home.
• It comes from things like the freedom of being able to remodel to suit the needs or your growing family or tastes; or gardening and barbecuing on the new deck; even from watching the kids play in the yard or chatting with a neighbor over the fence. The biggest benefits are putting down roots in the community. None of these benefits are fully available to you when you rent.