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Key Mortgage Company, Inc. in Columbia, Kentucky is your local lender for stick-built and manufactured homes, new and existing, purchase and refinance. 

We understand that every borrower is different, and we work hard to find the best loan product for our customers.  We offer a diverse selection with FHA, VA, Rural Housing, Kentucky Housing Corporation, and Conventional loan programs.  We also offer several options for new and existing manufactured housing, with and without land.

Call us today to find out how we can help you purchase or refinance your home!  Prequalifying is always free with no obligation.  1-877-353-2265.

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First-Time Buyers: How Much Down Payment Do You Really Need These Days?

For someone who is thinking of buying a first home, the idea of saving enough money for a 20 percent down payment can be daunting. The good news is a first-time buyer can purchase a home for a little as 3 percent down – and even no money down in some cases.

“The narrative that in order to buy a house in America today you need 20 percent down is just not true,” says Marietta Rodriguez, vice president of national homeownership programs and lending for NeighborWorks America, a national nonprofit focused on community development and homeownership. “There are a lot of different products that offer low down payment options.”

If you otherwise qualify for a mortgage, you can qualify for one with a lower down payment, though some options are only available to those with good credit. But you will pay more. That’s partly because if you pay less upfront, your mortgage balance is higher. Another reason is if you don’t make a minimum down payment of 20 percent, you will usually be required to pay private mortgage insurance.

PMI, as it is commonly known, protects the lender if you default on your loan. On a conventional loan, it’s usually added to your monthly payment. For loans offered by the Department of Veterans Affairs, the U.S. Department of Agriculture and the Federal Housing Administration, mortgage insurance is handled differently.

“The less you put down, the higher the mortgage insurance is,” says Casey Fleming, author of “The Loan Guide: How to Get the Best Possible Mortgage” and a mortgage professional in the San Francisco Bay Area. “With 5 percent down, the mortgage insurance is quite high.”

The cost of private mortgage insurance depends on your credit score and the size of your down payment. Freddie Mac estimates the cost at $30 to $70 per month for each $100,000 borrowed. The Freddie Mac website calculates that if you buy a $200,000 home with 10 percent down with a 30-year fixed rate of 4.5 percent, you’ll pay $80.75 a month in PMI (at a rate of 0.51 percent), in addition to the $962 monthly principal and interest payment (taxes and insurance are added on top of that). With 20 percent down, you’ll pay $810.70 per month.

If you need to pay PMI, the size loan you can get will be slightly smaller, to allow for the bigger payment. With a conventional mortgage, you can get an appraisal and write to your lender and ask to have the PMI removed once you have more than 20 percent equity in the home. With FHA loans, PMI lasts for the lifetime of the loan.

“Anyone with decent credit can get a loan,” Fleming says. “The limiting factor will always be the PMI.”

If you have a choice, should you make a bigger down payment to avoid PMI? It depends on your personal circumstances. You need to make sure you have enough cash on hand for closing costs and repairs. Some lenders will require a certain level of reserves before they will grant the mortgage.

“There’s really no hard and fast rule out there,” Rodriguez says. “Inasmuch as they have a choice, and have something to put down, they can run through different scenarios.”

Even with no down payment, homebuyers still need some cash to cover closing costs and upfront costs, such as a year’s worth of taxes and insurance. Some loan programs allow buyers to use a contribution from the seller or a gift from family for closing costs and down payments, but others do not.

“That means you need to be putting money aside,” says Sandee Rains, a financial education specialist in Tampa, Florida, with the nonprofit ClearPoint Credit Counseling Solutions. More here.

What’s Dragging Down the Value of Your Home?

It can be hard to place a monetary value on something that carries sentimental value.

But when you go to sell your home and find yourself tasked with pricing the place you hold so dear, how do you do it right?

As Gregory Barr, chief appraiser for Graham Appraisal in Glasgow, Kentucky, explains, all too often homeowners expect a higher appraisal value for their home when they put it on the market. “When we come by, everyone thinks their house is worth a lot more. When the tax assessor comes by, it’s worth a lot less,” he says.

At the end of the day, your home is worth as much as someone else will pay for it – and it’s an appraiser’s job to estimate what that value could be. “The market value is what a prospective buyer is willing to pay for the subject property,” explains Kelly Kellogg, owner of Appraisal Experts Inc. in the Orlando, Florida area and author of “ABCs of a CMA,” which provides real estate agents with a breakdown of comparative market analysis to price and sell properties.

An appraisal can be used at different stages of the home selling or buying process by the buyer, seller or lender to determine the market value of a home. The appraisal process is often helpful for owners preparing to put their home on the market and especially when a seller and real estate agent have trouble agreeing on an initial asking price.

If you’re told your home is worth less than what you thought it was, what could be the cause? Appraisers weigh in on some of the major factors that could be dragging down the value of your home.

Your home doesn’t compare to that house down the street. Appraisers use recent transactions of similar homes in the area to assess your home’s potential value – but the houses must have the same amenities, features and condition to be truly comparable.

According to Carole Christensen, owner of Appraisal Minnesota is Northfield, Minnesota, homeowners are often confused when they receive an appraisal value lower than expected, and argue the neighbor’s house down the street sold for X more dollars. “Well, [your] neighbor’s house has a brand new kitchen and baths and is 30 percent larger than your house and is a different design,” Christensen says.

The number of bedrooms, in particular, is a key factor in selecting comparable sales. Kellogg says appraisers aim to compare prices of homes with the same number of bedrooms because the detail changes what the potential buyer is willing to pay. More here.

2016 Tax Season Opens Jan. 19 for Nation’s Taxpayers

WASHINGTON ― Following a review of the tax extenders legislation signed into law last week, the Internal Revenue Service announced today that the nation’s tax season will begin as scheduled on Tuesday, Jan. 19, 2016.

The IRS will begin accepting individual electronic returns that day. The IRS expects to receive more than 150 million individual returns in 2016, with more than four out of five being prepared using tax return preparation software and e-filed. The IRS will begin processing paper tax returns at the same time. There is no advantage to people filing tax returns on paper in early January instead of waiting for e-file to begin.

“We look forward to opening the 2016 tax season on time,” IRS Commissioner John Koskinen said. “Our employees have been working hard throughout this year to make this happen. We also appreciate the help from the nation’s tax professionals and the software community, who are critical to helping taxpayers during the filing season.”

As part of the Security Summit initiative, the IRS has been working closely with the tax industry and state revenue departments to provide stronger protections against identity theft for taxpayers during the coming filing season.

The filing deadline to submit 2015 tax returns is Monday, April 18, 2016, rather than the traditional April 15 date. Washington, D.C., will celebrate Emancipation Day on that Friday, which pushes the deadline to the following Monday for most of the nation. (Due to Patriots Day, the deadline will be Tuesday, April 19, in Maine and Massachusetts.)

Koskinen noted the new legislation makes permanent many provisions and extends many others for several years. “This provides certainty for planning purposes, which will help taxpayers and the tax community as well as the IRS,” he said.

The IRS urges all taxpayers to make sure they have all their year-end statements in hand before filing, including Forms W-2 from employers, Forms 1099 from banks and other payers, and Form 1095-A from the Marketplace for those claiming the premium tax credit.

“We encourage taxpayers to take full advantage of the expanding array of tools and information on IRS.gov to make their tax preparation easier,” Koskinen said.

Although the IRS begins accepting returns on Jan. 19, many tax software companies will begin accepting tax returns earlier in January and submitting them to the IRS when processing systems open.

Choosing e-file and direct deposit for refunds remains the fastest and safest way to file an accurate income tax return and receive a refund. The IRS anticipates issuing more than nine out of 10 refunds in less than 21 days. Find free options to get tax help, and to prepare and file your return on IRS.gov or in your community if you qualify. Go to IRS.gov and click on the Filing tab to see your options.

  • Seventy percent of the nation’s taxpayers are eligible for IRS Free File. Commercial partners of the IRS offer free brand-name software to about 100 million individuals and families with incomes of $62,000 or less;
  • Online fillable forms provides electronic versions of IRS paper forms to all taxpayers regardless of income that can be prepared and filed by people comfortable with completing their own returns.
  • The Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) offer free tax help to people who qualify. Go to irs.gov and enter “free tax prep” in the search box to learn more and find a VITA or TCE site near you, or download the IRS2Go app on your smart phone and find a free tax prep provider.

The IRS also reminds taxpayers that a trusted tax professional can provide helpful information and advice about the ever-changing tax code. Tips for choosing a return preparer and details aboutnational tax professional groups are available on IRS.gov.

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Truck Sales Surging as Gas Prices Fall, Housing Improves

Not everybody needs a truck, but plenty of urban cowboys sure want one.

Analysts say truck sales that have jumped in the second half of 2015 will likely continue to be strong in 2016 as buyers no longer have to worry about high gas prices. And the strengthening housing market will increase the need for trucks large enough to haul tools and equipment.

Improved sales are helping boost revenues at companies, including Ford Motor Co.(ticker: F), General Motors Co. (GM) and Fiat Chrysler Automobiles (FCAU), the makers of Dodge – and that bodes well for investors who own stock in those companies.

Ford truck sales rose 8.2 percent in November versus the same month a year earlier. The company says retail sales of its F-series pickups rose 10 percent, making for the best November for truck sales in eight years.

Chevrolet truck sales rose for the 20th consecutive month in November. The company says sales of large pickups and SUVs were “particularly strong” as Suburban sales jumped 31 percent, Tahoe sales gained 17 percent and Silverado sales gained 4 percent – the best November for the line since 2006.

As gas prices tumble, truck ownership becomes more appealing. The increase in truck sales have coincided with declining oil prices, which are down about 24 percent in the past year, and a robust home construction market that has reached levels not seen since before the Great Recession.

“We see it historically that when fuel prices go down, SUV and truck sales correspondingly go up,” says Tim Fleming, an analyst with Kelley Blue Book, a vehicle valuation and automotive research company that tracks industry data. “While it may be difficult to (track) exact data, gas prices have an impact on the minds of consumers and their buying preferences.”

Nationally, gas prices have fallen to $1.90 a gallon, down 10 percent from a year earlier and more than half of the record high of $4.11 set in July 2008, according to AAA.

Crude oil futures traded in New York have plunged about 65 percent since hovering around $100 in June 2014. With oil and corresponding gas prices that high, buyers of trucks, typically gas-guzzlers, may pause before making a purchase.

Oil prices aren’t expected to rebound anytime soon and in 2016 are forecast to, at best, remain stagnant thanks to a global glut. OPEC nations refuse to cut production and instead want to maintain market share.

Even with fuel prices low, however, automakers are facing regulatory pressure to build more fuel-efficient vehicles. Ford is investing $4.5 billion in electric vehicles through 2020, creating 13 new electric and hybrid vehicles, and will offer electrification of 40 percent of its models. The company will develop an electric version of the Focus with a 100-mile range and quick-charge capabilities.

GM, for its part, has six models that get better than 40 miles per gallon.

While low gas prices are partially responsible for increased truck sales, housing starts have improved this year and are helping boost truck purchases as construction workers tend to need bigger, more robust vehicles.

“You do have a (sales) advantage with lower fuel prices, but a big driver for pickup trucks is housing,” says Erich Merkle, the U.S. sales analyst at Ford. “If you look at any construction site, you’ll see number of pickup trucks. As new home construction gains momentum as it’s been doing, that creates more of a need for pickup truck sales.”

Truck sales began to recover in mid-2015. Ford F-Series sales were languid in the first half of the year, company data shows. In June, sales of F-Series pickups were down almost 9 percent from the same month a year earlier. It was so bad, in fact, the company began offering incentives to buyers.

Those incentives disappeared with the introduction of the new aluminum-bodied F-150. After some production delays, the F-150 finally reached dealerships and were quickly snapped up by buyers. Thanks to improved sales, Ford was able to get away from offering deals, Fleming says.

General Motors also saw gains in pickup sales after reintroducing its mid-sized Chevy Colorado and GMC Canyon trucks. The 2016 Colorado was named Motor Trend’s truck of the year.

GM chief economist Mustafa Mohatarem says he expects auto sales to will continue to grow in 2016, including sales of SUVs and pickup trucks.

“We believe U.S. auto sales will continue to grow in 2016, based on the underlying strength of the economy, and we expect customers will continue to embrace crossovers and SUVs because they are meeting their fundamental needs for utility, comfort and fuel efficiency,” Mohatarem says.

Gas prices are likely to stay low in 2016, and housing starts are set for another strong year as interest rates remain low despite being raised by a quarter of a percentage point by the Federal Reserve in December.

Sean Becketti, the chief economist at Freddie Mac, says he expects housing activity will grow in 2016 despite monetary tightening.

Total housing starts are forecast to grow 16 percent this year, with single-family homes accounting for most of the construction increase, he says. That’s good news for truck-sellers.

Transaction prices are higher, meaning consumers are willing to spend more on higher-end vehicles, also a good sign for dealerships whose average truck prices are near $45,000, an increase of about 5 percent from the prior year, Fleming says. “There’s a pretty healthy demand right now so as long as that continues, those manufacturers that are building these big trucks, primarily the ones in Detroit, are going to be the ones benefiting the most.” More here