The Magic Number:  36% – the maximum amount of your pretax monthly income that should go to paying off your mortgage, student loans, auto loans and other consumer debt, such as credit cards.  If you are planning to purchase a home all of these debts will be important to consider.

Rule of Thumb for a Refi: 1% – if the new rate is at least 1% lower than your existing rate, you may benefit from refinancing.  Don’t ignore the costs to close the new loan, how long you plan to stay in the home or the time left on your current mortgage.  The final decision should be made keeping all of these factors in mind.

Tax Benefits you want to know 

Home Improvements - If you made improvements or bought appliances that boost your primary home’s energy efficiency, you may be eligible for federal tax credits. The conservation tax credit on qualified purchases is generally as much as 30 percent of the cost of the item, up to $1,500.  Go to www.EnergyStar.gov and search Tax Credits for Energy Efficiency for tax details, including expiration date and a complete list of purchase that qualify.

This entry was posted on Sunday, March 14th, 2010 at 5:35 pm and is filed under Market Trends.