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October 2019

Tax Benefits of Owning a Home in 2019

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First time home buyer tax credits are extremely useful for anyone looking to save a few bucks when making their first huge purchase. Read on below for key reasons and money-saving tips.

Big tax code changes occurred recently, and they are effective for the tax year 2019.

The most sweeping change moved the standard deduction up to to $24,000 for married couples, and this was meant to encourage taxpayers to stop itemizing deductions because, in many cases, the $24,000 standard deduction would be preferable to itemizing.

A favorite deduction for homeowners was mortgage interest, and now, with the new tax laws, it may make more sense to ignore the mortgage interest you have paid and just claim the standard deduction.

That said, there are still significant tax advantages to homeownership, and you should definitely consider these when considering home buying versus renting.

That Mortgage Deduction

first time home buyer tax credit

If you make a nice amount of money and you have an expensive home, you will want to deduct the interest paid on your mortgage if your total deductions are going to be more than $24,000. This deduction is valid for mortgage amounts up to $750,000.

For example, if you have a $700,000 30-year mortgage at five percent, your monthly interest payment in the first year of the loan will be around $3000.

That adds up to $36,000 per year, and therefore it would make more sense to skip the standard deduction and claim the mortgage interest deduction. This is the number one advantage of homeownership.

Property Tax Deduction

Image result for property tax deduction

If you are able to forgo the standard deduction and claim your mortgage interest, you can also claim a deduction for up to $10,000 of property taxes.

Add your $10,000 property tax deduction to your mortgage interest deduction, and your itemized deductions will reach a substantial total of $40,000—again, enough to ignore the $24,000 standard deduction.

First Time Home Buyer Tax Credit

great recession

During the Great Recession, there was a program that offered a first-time home buyer tax credit to first time home buyers. Unfortunately, this first-time home buyer tax credit has expired and is no longer available on the federal level. Our friends at Smartasset explain this:

If you’re still looking for the first-time home buyer credit, it unfortunately no longer exists. The program ended in 2010. However, people who purchased homes before 2010 can still benefit from the tax credit initiative. Specifically, you may still be eligible if your closing took place on or before September 30, 2010. People who purchased homes after 2010, however, won’t benefit from the tax credit.

Still, there are some state programs that may offer incentives to those looking for a first-time home buyer tax credit, so you need to check out what your state may offer.

Home Equity Loan Benefits

While you previously were able to more liberally deduct home equity loan interest, now you can only deduct it if you are using it for a specific purpose like home improvements. Still, this can be a worthwhile deduction to take. The IRS explains:

Despite newly-enacted restrictions on home mortgages, taxpayers can often still deduct interest on a home equity loan, home equity line of credit (HELOC) or second mortgage, regardless of how the loan is labeled. The Tax Cuts and Jobs Act of 2017, enacted Dec. 22, suspends from 2018 until 2026 the deduction for interest paid on home equity loans and lines of credit, unless they are used to buy, build or substantially improve the taxpayer’s home that secures the loan.

Profits from Home Sales

Finally, one big homeownership tax benefit does still exist and that allows tax-free profits from the sale of your home. Check out this explanation from CBS MarketWatch:

If you sell your main home for a healthy profit, the gain exclusion privilege can be one of the most valuable tax breaks on the books. If you qualify, you can potentially exclude (pay no federal income tax on) up to $250,000 of home-sale profit or up to $500,000 if you are married and file a joint return with your spouse. Since residential real estate prices are bouncing back strongly in many areas, the gain exclusion break has regained its relevancy.

Even though the government has increased the standard deduction to $24,000 and has repealed the first-time home buyer tax credit per se, there are still substantial tax advantages connected with homeownership.

Renting versus buying can always be a dilemma but do consider the tax benefits we have explained above as you work through the process. 

Organic Gardening

How to Plant Your Organic Garden in A New Home

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So, you’ve bought your first home. But now you want to make some upgrades, including an awesome garden to add value to your property.

How does it feel when you see a friend’s backyard organic garden? There is a refreshing sensation that comes along with the sight of an organic garden. Organic gardening is highly coveted by many due to its numerous health benefits. It decreases the number of pesticides your family eats, and it’s also good for the environment. But sometimes eating all organic can be a bit expensive, that’s why there is nothing better than growing your own natural garden.

If you want to eat and stay healthy, that is the right thing for you. Below is a simple yet very effective procedure on how to set up an organic garden for fresh and delicious food. If you need some extra tips, check out some awesome guides here.

Establish Your Location

Choosing the right location for your garden is the first thing to do. You need to put into consideration all aspects surrounding the garden including the following;

  • Drainage
  • Sunlight penetration
  • Type of soil
  • Safety
  • Accessibility
  • Ease of handling

Set the garden in the most appropriate location that won’t be problematic to handle. The best site is where it’s easily accessible, has direct sunlight, and good drainage. Remember that vegetables need 6-8 hours of full sun a day and a little shade to protect them from the afternoon heat.

Combat Weeds

If your new home garden is overgrown and totally out of control, your first fight might be with weeds. 

If your site is small, you can do the whole weed-digging and pulling thing manually. Make sure to remove them with the roots as they will grow back and compete for sunlight and nutrition with your crops.

However, if your garden is big, weeds might be a problem and hours of digging can lead to back problems. The best thing you can do in this situation is to mulch. 

Simply, cut down the higher weeds and cover the area with mulch. That will exclude the light so the weeds will weaken in the dark. 

Don’t be tempted to use weed killers, as they contain toxic chemicals. After all, you want healthy fruits and veggies, not to mention various medical plants you could grow.

Prepare the Soil

If you want to have the best results from your garden, soil testing and preparation is inevitable. According to professional gardener & horticulturist Pol Bishop, you must ensure that your soil is appropriately conditioned and that it suits whatever you want to plant.

First of all, ensure that your soil is healthy and has organic nutrients. Also, check the presence of any chemicals on the soils that can make your crops inorganic. You can achieve this by doing a soil testing procedure. 

Buy a home testing kit or send soil samples to a certified lab for analysis. You can opt not to test the soil if it’s plenty in humus.

Add Compost

All gardens benefit from compost. It feeds plants, helps with water retention and air circulation. You can create your own compost or buy it from the local garden centre if you have a large garden. 

Add five large buckets of compost for every five square meters of ground. It should be at least 10 cm on the top of the soil. Once you decide to sow seeds, use a rake to flatten the topsoil so the seeds can access both – soil and water. 

Shop for Seedlings

Did you know that you can acquire organic seedlings from the local farms and planters? If you don’t want to go through the hassle of setting up a seedbed, purchase ready-made seedlings.

The best place to acquire seedlings is from extension service centers. Talk to experts and seek advice on how to go about with your garden. Inquire about different species so as to know which suits you the best.

Choose plants that grow best within your region and climate. Also, consider choosing companion plants to your primary ones as they provide necessary nutrients to help them grow and repel pests that would otherwise attack your crops.

Choose your seedlings gently and avoid the wilting ones. Also, avoid budding crops, or the flowery ones that tend to be unsuitable for transplant.

Assemble Gardening Tools

As you are going to embark on planting, assemble the right tools that you must have. Browse through some gardening tools to weed and dig from Easy Digging. Some of the starter tools include:

  • Watering can
  • Hoe
  • Rake
  • Shovel
  • Pruners

These are some of the tools you will need when gardening. They are essential for the daily maintenance of the garden, and you need to purchase the right quality.

Plant Your Seedlings

After assembling the right tools, you can move on with the planting procedure. Plant your crops in the proper method and spacing guidelines. When planting, you can seek professional advice if you aren’t an expert in it.

Make sure the beds are well prepared and that the soil is wet enough. Take extra care on the seedlings immediately after planting to ensure they don’t die.

Keep it Clean

Once a week, make sure to walk through your garden and pick up any dead leaves. Remember that diseases spread rapidly in fallen foliage, and sometimes you can save the entire plant just by picking off an infected leaf. 

Water Wisely

The best time to water plants is in the morning as then is cool, and water evaporation is reduced. Never water in the evenings, as plants will stay damp overnight, which will make them vulnerable to fungal diseases.

Water the roots, not the greenery, that’s why a drip or soak system would be perfect. To establish strong plants, water infrequently but deeply. One or two applications a week considering rain is enough. Always use air temperature water, hereof collected rainwater is best. 

Practice Crop Rotation

Don’t grow the same crop in the same spot every year. Some crops like potatoes and cabbages reduce soil nutrients, whereas others like peas and beans build them up. That’s why crop alteration is essential. Also, this will prevent the build-up of pests and diseases in the soil.

Use the Companion Planting Scheme

Growing strongly scented plants near your crops will repel pests by confusing them.

  • Chives – prevents aphids and carrot fly
  • Lavender – attract pollinators and deter aphids
  • Rosemary – stops carrot fly
  • Yarrow – attract ladybirds and hoverflies
  • Dill – attract aphid-eating hoverflies

Attract Wildlife

Stop using chemical pesticides, which upset the natural ecological balance and kill everything, from pests to their natural predators. Pest may recover way faster than their predators and keeping their number in check may be a problem. Toads, hedgehogs and birds are your best friend in the pest control job. 

For example, flowers like marigolds will attract ladybirds and hoverflies which eat aphids. Research your pest control and learn as much as possible about the sort of pests depending on what you are going to grow.

Below you can see which flowers can help you attract helpful insects like lady beetles and praying mantis. According to stylists at the farm-fresh flower company Bouqs, the following will also attract bumblebees to pollinate the rest of your plants.

  • Cleome
  • Zinnia
  • Daisy
  • Sunflower
  • Salvia

The Bottom Line

Are you looking forward to planting your organic garden? This is the simplest way that will give you the ultimate organic garden. If you have been dreaming of owning a garden, follow this procedure to fulfill your dreams. Happy harvesting!\

interior design tips

7 Cool Interior Design Ideas To Elevate Your Home

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If there’s one place that speaks your personality the best, then that is your home. From the furniture to the wall paints and decor, almost every part of your home reflects what you truly love. To make the precious reading sessions even more tranquil, you must keep the interior decor drool-worthy. When it comes to decorating your house, you need to sit back and think first. Find out the right theme and go ahead with the decor process. You don’t want your home to look unorganized and unplanned. 

Whether you need some warmth or softness in the rooms is truly your choice. Think about the pattern of wall decor, ways to enhance the space, and add a few warm tones here and there. Also, don’t forget to fetch the right quality items for a durable and long-lasting house make-over.

Keep reading to know the trending interior designs and tips to keep the home decor top-notch instantly.

More Light With Attractive Wall Mirrors

A house that’s well-lit and illuminated appears incredibly peaceful and fresh. Apart from the regular wall lights and chandeliers, there are few cheap ways to enhance the brightness.

All you need to do is get hold of different sized mirrors. From square mirrors to oval-shaped ones, you can fetch any mirror without giving much thought to it. Hang them on the walls opposite the windows for better reflection of the sun’s rays. Not only will they cover up the left-over space, but they also bring more value to the decor.

So, grab some attractive mirrors and create a wall of your dreams today.

Add House Plants Wherever Possible

A house should be two things, clean and green. Adding a few house plants here and there can lead to a fantastic transformation. Whether it’s for a fresher environment or an ecstatic interior decor, plants are always the right choice. You can put them anywhere.

From your kitchen slab to your bathtub, every place is suitable for some greenery. Such eco-friendly decor will surely enhance the atmosphere and freshness of your house. 

Just put some house plants near every table or on the balcony. Apart from this, you can add a few plants inside the bathroom as well. Allow the detoxification process of your rooms with a greener interior. Don’t forget to decorate the plants aesthetically in various patterns.

Create Staircase Storage For More Space

One of the most crucial aspects of interior decor is enhancing the space. You must opt for the decoration that allows better storage and spacious rooms. Instead of filling the rooms with unnecessary decor items, try being a little specific.

Choose designs that improve storage options. One such option is staircase storage. Usually, the space occupied by the stairs is left wasted. 

However, you can convert that space into a bookshelf or a plant holder with storage. All you need to do is create storage with compartments. Further, fill those compartments with whatever you like.

Moroccan Vibe With Unique Lighting

What could be better than embellishing your home with some fancy lighting and attractive decor?

If you’re looking out for some high-quality lighting to revamp your house, then choose the light properly. Always go for some durable yet classy lights. One of the best options for such home decor is led wall lights. Just grab some wall lights and pair them up with attractive lanterns. 

Add the wall lights on every edge of the room. Complete the lighting by hanging the lanterns near the areas that require better attention. 

Use Contrasting Rugs On The Floor

While decorating our house, we often overlook the floor area and its embellishment. The best thing you can do to increase the comfort and make the floors stand out is to add a rug. You can find rugs available in unique colors and patterns.

Opt for the one that matches the wall paint and overall interior design of the rooms. Floor rugs are an amazing way to get that cozy vibe in your home. It’s about time that you spend your happy days over the softness of these floor rugs. Also, this will enhance the beauty of your interior decor astonishingly. 

So, do your house floors a favor and fetch the best rugs today.

Best Out Of Waste Inspired Decor

If you’re in search of an in-budget home rejuvenation, then take some inspiration from the waste. Go ahead and enter your store-room today. Search for the waste that would look good on your bookshelves or lamp tables.

From silver trays to plates and metal boxes, everything is usable if you’re creative enough. Put the trays on the table and stack your favorite books over it. 

You can also decorate the plates over an empty wall in a creative fashion. Overall, the waste inspired decor is what you must adhere to on your next house rejuvenation.

Give The Walls Some Make-Over

Almost everybody works on furniture, wall paints, and decorative items. To make your decor stand out, you must dress up the walls elegantly. Yes, we’re talking about the wallpapers. Choose wallpapers with unique patterns and shades. You can also opt for a nature-themed wallpaper for specific rooms. 

This is not only an easy embellishment but also one that attracts almost every guest. Convert your walls into an amazing piece of art with these aesthetic items today!

Bottom Line

Interior designs are a mere reflection of the owner’s soul. Every person possesses a specific quality which they instill in their house’s decor. If you wish to keep your house sturdy, elegant and eye-catching, then you must analyze the make-over.

Get inspired by the waste and use the same to achieve the best interiors. Further, complete the revamping sessions by using extra mirrors, wallpapers, and rugs. 

Overall, the key to an amazing house is creativity, presence of mind and smart work. You can easily procure the cool interior design impression if you work for it. Don’t wait to enlighten your guests with some drool-worthy interior.

real estate investing books

8 Amazing [MUST READ] Real Estate Investing Books

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We checked out the 2019 real estate investing books landscape, and we have found eight books that we consider must-reads if you are really interested in becoming a serious real estate investor. Take a look below.

You’re really interested in real estate investing. You’ve attended a couple of seminars, watched a bunch of online presentations but a lot of the stuff you have been exposed to has been quite sales-y, and you wonder if any of the purported plans and schemes really work.

To you it seems like the presenters are just trying to sell materials or expensive manuals.

Rich Dad, Poor Dad

Rich Dad Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not!

Written by Robert Kiyosaki and Sharon L. Lechter, Rich Dad, Poor Dad was originally a self-published book that was eventually picked up by a major publisher. It is a thorough guide for creating wealth and accumulating assets.

While it isn’t strong about specific real estate strategies, it gives a great general overview about the mindset that is required to win in business, and the book devotes a good amount of time explaining the reason for investing in real estate as a vehicle that can produce fat returns.

The Book on Rental Property Investing

This is one of the best real estate investing books of all time. Brandon Turner wrote this book, and you’ll find it on almost all of the top-ten lists of real estate investing books.

Mr. Turner is also involved the familiar BiggerPockets.com site. His book has a great section about mistakes that novice investors need to avoid, and many think that this is the first book real estate beginners should read before they embark on a career as a property investor.

The Book on Flipping Houses

J. Scott has authored a handy treatise about flipping houses—a strategy that HGTV made very popular.

This book most importantly explains the proper methods to evaluate homes for potential flipping and walks you through the process of obtaining financing.

Start with this one if you want to do quick turnover deals.

The Intelligent REIT Investor

Written by Stephanie Krewson-Kelly and R. Brad Thomas, this book explains Investing in a Real Estate Investment Trust (REIT). Think of REITs like a real estate ETF, and you’ll get an idea of what they can do for you.

Like any investment, due diligence is key, and the authors explain just how to choose the REIT that would be best for you. If you are at all interested in passive investing, put this one of your list of real estate investing books for 2019.

Mastering the Art of Commercial Real Estate

Doug Marshall has subtitled this book, “How to Successfully Build Wealth and Grow Passive Income from Your Rental Properties.”

And that tells you what you will find inside. Understand that commercial real estate can be much different from residential housing, and if you are thinking of investing commercially, you’ll be looking at multi-family units, strip malls, warehouses and even public storage facilities.

Mr. Marshall has a good section on timing, which we all know is everything, right?

The Turnkey Revolution

Christopher Clothier wrote The Turnkey Revolution. A turnkey property is the exact opposite of a fixer-upper—everything has already been done for you.

All you need to do is buy it and rent it and watch your mortgage principal decrease while you enjoy cash flow.

Mr. Clothier tells you how to find these gems and how to properly evaluate them for superior cash flow. With any real estate investment strategy, there are areas to avoid, and Mr. Clothier carefully spells out problem areas that you may find.

The Millionaire Real Estate Investor

Gary Keller’s book should maybe be subtitled “You Too Can Get Rich in Real Estate,” as he explains how to make money in real estate.

Covering a wide range of do’s and don’ts, The Millionaire Real Estate Investor makes you think and act like a millionaire real estate investor even if you’re not there yet.

The Book on Tax Strategies

By Amanda Han and Matthew MacFarland, this book is the bible of real estate tax planning.

In fact, Brandon Turner said, “Had I read this book earlier in my real estate investing career, I easily would have saved myself thousands in taxes and my net worth would be significantly higher!”

That’s all the credibility we need, so if you want to save yourself tons of tax dollars, read and understand what the authors say before you start investing in real estate.

While many investors learn from just buying real estate and not repeating their initial mistakes, if you read the above real estate investing books, you’ll be far ahead of the game.

If you’re interested in learning more about the basics of real estate investing, check out our recent post on real estate terminology.

Lowering Your Mortgage Rate

5 Tips For Lowering Your Mortgage Rate

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Buying a home in 2019 is arguably one of the largest purchases you will make during your lifetime. And lowering your mortgage rate can be equally as tough.

Financial obligations attached to owning real estate should not be taken lightly; lowering the coast of your homeownership begins with your mortgage.

With that said, if you don’t follow some of the tips below, you will end up shelling out a lot more cash than you intended.  

Go Shopping

Don’t sign for the first home you see. Lowering your mortgage rate should be a thought you have in mind, which will take time.

Take your time to shop around for the best rate; your wallet and long term financial situation will thank you.

A 2012 Stanford University study concluded that consumers who obtain at least four mortgage quotes save nearly $2,700 in fees for a $200,000 home loan compared to those who only got one or two quotes.

Thankfully, the advancement of the internet makes shopping around for better rates more efficient than it was 20 years ago. 

Maintain a Good Credit Score

You must maintain a high credit score in order to get the best possible rate for you for your mortgage.

A high credit score ensures your lender that you are credible enough to pay it back. A low credit score could cause a lender to raise your rate and potentially deny you the loan altogether.

There are many different ways to keep an eye on your credit score. Many of the top credit reporting companies are secretive about how their scores are calculated.

However, FICO openly lists how they compute credit scores, and they are as followed:

  • 35% is based on your payment history (make them on time)
  • 30% is based on your credit utilization (try to keep it under 20%, if possible)
  • 15% is based on length of credit history (don’t close accounts you’ve had for a long time that are in good standing)
  • 10% is based on new credit accounts (only open new accounts when it makes sense to do so)
  • 10% is based on credit mix (lenders want to see that you can manage different types of loans) 

Long & Consistent Work History

Another way lenders will evaluate your credibility is through your work history. Lenders are more likely to give you a satisfying rate if you have maintained the same job for a few years and your annual income is consistent or growing.

At the same time, if you have a resume with gaps and inconsistencies, lenders will view your income as unreliable and charge you a higher rate or deny you entirely.  

Ask For a Better Rate

It can’t hurt to ask! You can ask for a lower rate or ask your lender to match a competitor’s rate. The worst-case scenario is that they say, “no.” If your credit score is 800 or higher, your chances of being granted a lower rate go way up.

According to FICO, only 1 in 9 Americans have scores this high, and if you are one of those people, lenders will do almost anything to keep you as their customer. So, don’t be afraid to ask!