Paperwork shuffle

One important thing to keep in mind when shopping for mortgage quotes is to ask the bank if the mortgage is through their institution, or if they are selling it to another bank. For example, we decided to go with a local bank for our mortgage because we figured it would be easier to deal with. Imagine our surprise when we discovered the bank had sold our mortgage to Washington Mutual. It didn't make much difference to us at the time, but now that we are dealing with a large insurance claim that involves the mortgage company, I really wish we could deal with it locally.

Apparently, when the claim is over five thousand dollars, the check is made payable to the mortgage company as well as the homeowners. The mortgage then deposits the money into a restricted account and will only release half of the funds until the homeowners send in a bunch of paperwork to prove they are actually having the house fixed. Once the work is completed to their approval, they release the rest of the money to the homeowners so they can pay for the work.

So we are busy juggling through paperwork, while work is being done and the contractors (understandably) want to be paid for their work. Then a couple of days ago, Washington Mutual was bought out by JP Morgan Chase. Oh, great. So now we are worried that this will slow things down even more and it will take longer to see the money.

We're just old-fashioned

My husband and I tend to agree with our grandparent's generation when it comes to certain things like finances, family, and what's important in life. If you talk to someone in their seventies or eighties, their advice will be to steer clear of mortgage lenders when you buy a home. Of course, most people today find it impossible to save up enough money to buy a home, but stay with me. If you do require a mortgage to purchase a home, at least try to pay it off as soon as possible. There are many payment acceleration programs offered, or you can just pay extra toward your principle on your own. The argument against paying off the mortgage tend to involve taxes. Well, I can tell you firsthand that the tax benefits are just a fraction of the amount you pay each year in interest, which you would not be paying at all if it were paid off.

We also believe, like our grandparents, that families should eat as many home cooked meals together as possible with no other distractions. We gave up television two years ago, which promotes reading, artwork projects, and imaginative game playing.

Vacations are viewed as a necessity in our family. Vacations promote bonding and learning for everyone and we believe families should take at least one vacation per year. And you can't use lack of money as an excuse - the togetherness is what counts, whether you are 1,000 miles from home or 100. Kids don't understand distance anyway, they just get bored with really long trips. So find something close to home to explore as a family, keep it simple, and everyone will be happy.

Necessary home update

A couple of days ago, our water heater just started leaking with no warning. It had been working just fine up until then, and just decided to quit on us and flood my daughter's room. See, one downfall of Eureka Springs is the lack of building codes up until just about five years ago (or so I've heard). So in addition to several other oddities about the way our house was built, the water heater was installed inside a bedroom closet, with no drain, and on the carpet.

So we've spent the last two days with fans under the carpet, which we pulled up from the corner and raised up to dry from underneath. We called our insurance agent to see if repairs would be covered under our home-owner's policy, but of course they have so many clauses and exclusions that render most homeowners helpless in their situation. In any case, I recommend reading your homeowner's policy, life insurance policy, mortgage life insurance policy, or any other insurance you may carry to make sure the coverage is adequate.

Our situation ended up fine this time, due to some research on our part on dealing with wet carpet and preventing mold. We ordered a new name brand hot water heater from a well known store and they came and installed it the next day. But now I will be worried about anything else happening and if it will be covered by insurance or not.

Blog review: Mortgage Lowdown

Upon arriving at Mortgage Lowdown, I am struck by the site's simplicity and its lack of advertisements. This is a refreshing change in the world of finance-related websites and blogs. There are great tips and articles, all regarding mortgage banking and home ownership. Some of the articles have images to break up the text, and the site could probably use more graphics in general to keep readers' interest.

My only concern is that since the topic of the blog is so specific, they may exhaust the topic of mortgages and find there is not enough to write about in the future. Overall, this is a well thought out blog with some very informative posts and I plan to subscribe to their feed via Bloglines.

Home Mortgage tip

In our experience shopping around for Mortgages before we moved here, I was very surprised that you can sometimes get a lower percentage rate just by asking for it. I'm sure there are other little details like this that can make a huge difference in the long run. It's worth your time to visit a website with Mortgage and Mortgage Refinance tips.

I find that the process is much more comfortable if you know all the terminology and do some research yourself before going to your closing. When you are purchasing a home, your real estate agent is there to help you, but at a Home Mortgage Refinance closing, you have to be prepared and confident enough to ask questions yourself, since the Realtor won't be there.

Speaking of extra money

On the topic of home improvements, one option is always a home equity loan. I don't think we've lived in our house long enough to have equity for a loan yet, but it's an idea to consider in the future. My mom made a huge mistake with her loan that I will make sure to avoid doing myself.

She took out a home equity loan to remodel the kitchen, fix some old plumbing, change the carpet, etc. She ended up buying a brand new car soon after and since she still had the extra money in her account from the equity loan, she used that to make the down payment on her car so the monthly payments would be lower. The problem is, the interest rate on the equity loan is higher than the interest on the car so she will end up paying more in the long run and now she doesn't have the cash to make those home improvements.

Maybe if she would've gotten some advice from a website like PersonalHomeLoanMortgages.com, she wouldn't be in this situation.