Question: My mortgage broker tells me there are many mortgage options. How do I know which to choose?
Answer: In recent years there has been an explosion in the number of mortgage types available. You must work with a lender or mortgage broker to determine the loan that is best for you; however, there are some general pointers to keep in mind. Loans come in many varieties: fixed rates (for 15, 30 or sometimes now 40 years) or adjustable, where the rate is often low for a few years then can change, going up or down. If you choose an adjustable loan, be sure that you can afford to make payments if the interest rate rises. One popular loan these days is the interest-only loan, where you defer payment of your principal for a set period of time. Do know, however, that when that period expires, you typically will pay both the regular and the deferred principal, upping your monthly fee substantially. Some lenders tell you you do not need to put up any money to get the loan; this may be true, but in my experience, underwriters sometimes balk at these deals, and your closing could be in jeopardy, which is why I often tell my seller clients to beware of buyers with little cash. Watch, too, for prepayment penalties in your prospective loan; if you have one and refinance your home (and in some cases, even sell it), you will have to pay a hefty surcharge to the lender. Finally, lenders vary widely in their fees and closing costs. Ask any lender for a “good faith estimate” before you sign on, which will document their expected charges.
Question: My wife and I moved to Florida and bought a home in November. I heard we are eligible for a Homestead exemption. How do we get one?
Answer: Homestead exemptions are a reduction in your property taxes for a primary residence. If you bought your home in 2013, you must file for an exemption by March 1, 2014. To qualify, you will need a Florida driver’s license with your new address, plus other documents. For details, check out the Broward County Property Appraiser’s office at bcpa.net. You can also call them at 954-357-6830, but it is often difficult to get through.
Question: I fell behind in my maintenance payments and found a person willing to lend me the money in a complex transaction. Now that person says he owns my house. I think I have been the victim of a scam.
Answer: There are a number of scams out there that homeowners must be wary of, or you can indeed lose your house even if you owe only a relatively small amount of money. In one scam, the “lender” agrees to pay your back maintenance and current monthly mortgage and fees for a certain time-period if you write the monthly check to them by a specific date each month. Miss that date even by a minute, and they take the title to your house that they are holding as collateral for the loan. If you are indeed behind on your monthly maintenance payments, try to work out a plan with your association or contact only a reputable lender.