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This post is courtesy of one of the lenders I utilize, Kate Wilson, of Fairway Independent Mortgage. She and her team work with all buyers and are especially knowledgeable about first-time buyer programs.
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Guest Author: Kate Wilson of Fairway Independent Mortgage

We have a magazine rack for our clients in our lobby. I was really hesitant to put out the September 6th edition of Time Magazine because the front cover read: Rethinking Homeownership: Why Owning a Home May no Longer Make Economic Sense.
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I can think of a lot of things that don’t make much economic sense but I sure wouldn’t put buying a house in that category. I have some pretty strong convictions about why homeownership is important and a lot of them start with common sense. I take the long-term view:
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There are tax advantages to homeownership that you don’t get when you rent. Once you have a fixed rate mortgage, the principal and interest payment will not change over time. Your rent will and you have no control over just how much those rent increases might be. Both the interest and the property taxes are deductible but only your landlord gets to deduct them when you rent.
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At the end of the day, a house is a forced savings account. If you pay all of the payments, at the end of the loan term, you own the asset. You can save yourself a lot of interest and get there faster by making one extra Principal and Interest Payment a year. It’ll take about 7 years off of a 30 year loan. If you pay rent for 30 years, your landlord will own the asset and use it to pay for his Long Term Care, not yours.
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Your mortgage should not outlive your retirement age even if you’re buying up. Mortgages come in terms of 10, 15, 20, 25, and 30 years. Consider this: If you’re buying up, keep your mortgage in sync with your overall financial plan and objectives. If you’re considering a move, take the age you want to retire and subtract from it your current age and see how much you’ll qualify for using that amortization period. There’s no prepayment penalty for first mortgages these days so even if you take out a 30-year mortgage to protect against a ‘what if’ scenario, figure out how much extra principal it takes to repay it according to your retirement timeline and just do it.
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Home equity lines of credit for vacations or the purchase of cars are a bad idea. You’ll be paying for that vacation long after the memories have faded. The car started to depreciate the minute you drove it off the lot and you’ll be paying for the old one even after it’s eligible for vintage plates.  In the meantime, you will probably have to buy another car and pay for it while you’re still paying for the trade in.
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The most common sense reason I can think of for homeownership has nothing to do with it making economic sense. When you own your home, you are free to make it fit your lifestyle and a reflection of who you are. Landlords call such changes ‘damages’ and keep your deposit or kick you out. If the landlord decides to sell and you have to move, you can lose years of accumulated emotional net worth.

Other than graduating from college, having my kids, and marrying my sweetheart, I can’t think of a better decision I’ve made in my life than becoming a home owner. Your thoughts?

Kate Wilson

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I agree with what Kate has written here which is why I asked her if she was agreeable to my posting her thoughts here. We’d both be interested to know your thoughts. Share them by adding a comment below. (The typeface color for Leave a Comment is green so it doesn’t stand out immediately but it’s at the end of the list of tag words at the bottom of this entry.)

Learn more about Kate Wilson and her team here: www.katewilson.com

Kate Walsh
REALTOR®
Lakes Area Realty
612.220.3309
info@designhouse9.com
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3900 Auburn Drive

Breathtaking Panorama

Aerial View - Click photo to see it larger

Watch the video slide show here.

List Price: $750,000

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The Details:

  • Four bedrooms and four baths.
  • Set on a 1-acre lot that juts out into Huntingdon Pond.
  • Completely and beautifully renovated by Warren Home Restorations.
  • Wonderful entertaining spaces both inside and outside.
  • Expansive windows throughout to take advantage of the views.
  • Gourmet kitchen with granite, stainless, and custom cabinets.
  • First-floor master suite with fireplace.
  • Master bath features whirlpool tub and separate steam shower.
  • Climate-controlled wine cellar/tasting room with artistic finishes.
  • Exercise room in lower level.
  • Water filter/ionization system for the whole house.
  • Built-in speakers in almost every room.
  • Two-car attached garage.
  • Finished Square Feet: 4,364
  • 2010 Taxes: $8,635
  • School District: Hopkins

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For more information and/or to arrange a showing, contact:

Kate Walsh, REALTOR
Lakes Area Realty
612.220.3309
info@designhouse9.com

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Minnetonka Historical Society

City of Minnetonka Website

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Listing provided courtesy of Coldwell Banker Burnet.

Information deemed reliable but not guaranteed.
Lasted updated on September 17, 2010 at 21:29pm.

The data relating to real estate for sale on this site comes in part from the Broker Reciprocity program of the Regional Multiple Listing Service of Minnesota, Inc. Real Estate listings held by brokerage firms other than Lakes Area Realty are marked with the Broker Reciprocity logo or the Broker Reciprocity house icon and detailed information about them includes the names of the listing brokers. DesignHouse9 is not a Multiple Listing Service MLS, nor does it offer MLS access. This website is a service of DesignHouse9 and Lakes Area Realty, a broker Participant of the Regional Multiple Listing Service of Minnesota, Inc.

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