It’s a dream for many Latino families to own a home. But with the more economic and labor uncertainties, keeping a home can be difficult at times.
According to a study by the National Association of Hispanic Real Estate Professionals (NAHREP) Latinos achieved modest gains in net new owner households in 2014. The rate of home ownership among Latinos is at 45.4 percent, though NAHREP predicts Hispanic homeownerships in 2015 will be “exponentially strong.”
Purchasing a home is one thing, but keeping it has a lot to do with managing the monthly payments. Here are five tips to make sure you manage your mortgage from attorney Chris Cabanillas.
1. Pay On Time
“A lot of people take that for granted and it sounds pretty easy, but you’d be surprised how many people forget to make a mortgage payment on time. If that happens, it can ruin your credit and can cause a lot of problems and sometimes people can accrue more interest. What I recommend, if you can, is to put it on auto pay. Sometimes you can do it through your bank directly or with your own credit union or savings account. You can set it up so that your payments can get withdrawn automatically.”
2. Don’t over spend or over borrow on unnecessary repairs or improvements to your property
“A lot of times people will purchase the property and scrape up every dollar that they have in order to get that purchase completed. Then they will go out and borrow a bunch of money in order to buy a refrigerator or buy fancy kitchen appliances. You can run into a lot of trouble by doing that because you are going to have to pay interest back on the credit cards you used to make that purchase.”
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3. Set Aside a Rainy Day Fund
“This can be for those urgent repairs that from time to time will come up with your property. For example, a leaky roof or a broken boiler, if those things do have a problem, you are going to have to fix them and you’ll be thankful you had that money set aside.”
4. Watch Your Property Taxes and Insurance Bills
“What I find a lot is that people will lose sight of the fact that those things almost always go up every single year. The insurance companies will almost always entice people to use their property insurance and what they will do is give a teaser rate or a very low affordable rate when you first come in. People lose sight of it because it is automatically getting paid through their mortgage, and what happens is that those premiums start to go up by 10 and sometimes 20 percent in any given year. That could add up to a lot of money.
“Likewise, with your property taxes, often times your municipality will be raising those property taxes yearly. That is something you need to keep an eye on too. If you feel that your property value is not in line with the property taxes that you’re paying, there is a way that you can [try to] reduce those through what is called a ‘Tax Grievance.'”
5. Try To Pay Down Mortgage Quickly
“One of the simplest ways to do this is to take your mortgage payment and cut it in half and make that payment every two weeks. If you do that over the course of a year you’ll end up making 26 half payments which add up to 13 months of payments. That extra month of payment will pay down your mortgage and you’ll save a lot of money in the end.”