Is it Cheaper to Close at the End of the Month?

When you obtain a loan to purchase a home, you’re required to prepay any interest that will accrue from the date of closing until the end of the month. So, in theory, the closer your closing is to the end of the month, the less you have to pay in closing costs.

This portion of interest is charged to the buyer at closing because mortgage payments are made in arrears. Unlike paying a rent, a monthly mortgage payment actually covers the previous month. For example, if you were to purchase a home and close in January, your first mortgage payment would not be due until March 1. The payment on March 1 would cover the principal and interest owed to the lender for the month of February. For a visual illustration, take a look at the sketch above.

Regarding the prepaid interest, assume your actual closing date is January 15th. Your prepaid interest charge is as follows:

Mortgage amount:    $175,000
Annual (fixed) interest rate: 6%
Daily interest charge:    $28.68

Now compare the potential savings in prepaid interest when closing on the 31st vs. 15th.

10 Things To Do In Austin This Christmas

Are you spending your Christmas in Austin this year? Every year the city plays host to many festive shows and events throughout the holiday season. From the Zilker Trail of Lights to Ice Skating on the Plaza at Whole Foods Market, these 10 events are just a sampling of the many things to do and see in Austin this time of year.

Zilker Trail of Lights
Thru 12/23, Zilker Park
www.ci.austin.tx.us/tol/default.htm

Skating on the Plaza
Thru 1/1, Whole Foods Market (6th & Lamar)
www.wholefoodsmarket.com/stores/lamar/index.html/

 Santa vs. The Snowman 3D: IMAX
Thru 12/31, Bob Bullock Museum
http://www.thestoryoftexas.com/

Ballet Austin: The Nutcracker
Thru 12/23, Paramount Theatre
http://www.balletaustin.org/

Holiday Pops: Simply Sinatra
12/30-31, Palmer Events Center
www.austinsymphony.org/newspress/pr_Sinatra.asp

Hill Country Lighting Trail
www.tex-fest.com/regional/default.htm

37th Street Lights
(37th St. between Guadalupe and Home Ln.)
www.austin360.com/event/events2/etc/userEventDisplay.jspd?eventStatus=Approved&eventid=152625

The Armadillo Christmas Bazaar
Thru 12/24, Austin Convention Center
www.armadillobazaar.com

Rockin’ Christmas Party
Thru 12/30, ZACH (Riverside & S. Lamar)
www.zachscott.com/stages/rockin.html

First Night Austin 2008
12/31, Downtown Austin
www.firstnightaustin.org

photo provided by: yummiec00kies

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Should I Buy a Home In a Good School District Even If I Don’t Have Kids?

Perhaps you’ve heard this before: Buy a home in a good school district even if you don’t have kids.  There’s no doubt those who choose to live in a good school district pay a premium in the form higher property taxes. So, is it really a good strategy to follow?

YES, so long as you can afford the higher taxes. Even if living near exemplary schools is not a priority for you, still consider the strength of the schools in the area in which you are searching. Generally, homes in a good school district, enjoy the benefit of healthier appreciation and less time on the market when it’s time to sell (assuming the price and condition are not more than the market will bear).

On the other hand, by purchasing in a less-reputable school district, it’s likely you will have reduced the pool of buyers down the road, namely, families searching for a home near quality schools.  

WHERE TO FIND THE BEST SCHOOLS IN AUSTIN

Great Schools is an excellent place to start. There you can browse the top-rated public and private schools in Austin, as well as, compare schools near a particular address or school district. In addition, you can find the most recent Accountability Ratings, which measure how well schools and districts within Austin are performing. Lastly, the site provides a useful platform for parents to hear what other parents have to say about their child’s experience in a particular school or district.

Here are the  Top-Rated Elementary Schools in the Austin Independent School District  for 2007.

• Mills Elementary

• Casis Elementary

• Highland Park Elementary

• Baranoff Elementary

• Hill Elementary

• Gullett Elementary

• Kiker Elementary

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