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Know the Facts About Prepayment Penalties
Prepayment penalties are imposed by some lenders on borrowers who either pay off, or pay down, their mortgage loan ahead of schedule. But take note, some states don't allow these prepayment agreements and others have restrictions on them. Check your state regulations before you start your home search.

Prepayment penalty agreements usually last for three years. But even during these three years, borrowers will be able to pay off up to 20% of the principal per year without incurring the penalty. After that period, penalties won't apply, even if you totally pay off your mortgage.

Penalties can be substantial

Penalties vary by lender, and can amount to the better part of six-month's interest. For example, on a 30-year, $150,000 mortgage at 4%, six months of interest totals $2,989.15 - not a negligible amount.

To compensate for offering a lower interest rate, some lenders will include a prepayment agreement on a mortgage. This means the lender, and the investors who purchase their loans, will make something on the loan if you refinance, want to take advantage of lower interest rates or sell earlier than you anticipated.

If you are considering a loan that has a prepayment penalty, ensure you fully understand the terms. And know your options: If, for example, you expect to relocate during the penalty period, you may want to look for loans without prepayment penalties. If you plan to stay in your home, but would like the choice to refinance during the penalty period if interest rates decline, you'll also want to consider your options.

Espresso Book Machines: Just What the Bookworm Ordered
While these days, newspapers are mostly online, some enterprising book stores are still managing to hang on. In a recent CITYLAB article, Eillie Anzilotti, writes: "An old shop in Paris is holding onto its place in the city by embracing new technology." As strange as it sounds, that shop is a book store without books.

A new wave of book stores are banking on technology to keep them relevant; the so-called Espresso Book Machine is a print-on-demand device that lets buyers choose from potentially millions of books and sip coffee while waiting for their selection to be printed. The process takes minutes.

According to Anzilotti's article, can On-Demand Printing Bolster Bookstores? The first Espresso Book Machine dates back to 2007, when one was installed in the New York Public Library. "Since then, the printers have cropped up in a handful of libraries and stores in cities throughout the world," Anzilotti notes.

Book stores have been struggling to remain profitable over the last decade. Initially, big box book stores squeezed out many of the independents. Then it was competition from e-commerce. The latest fear is that people simply don't read any more.

And, in fact, many book stores of note have failed despite adding coffee shops, stationery departments and e-readers to their offerings.

For those individuals who still enjoy reading on paper, the Espresso Book Machine may be just what the bookworm ordered. It's a future-forward solution that enables book stores and libraries to stay relevant in a high-tech world. Readers rejoice!

Three Easy Ways to Cut Household Expenses
For many of us, it can be shocking to see how quickly our household expenses add up; it may feel like our entire paycheck goes toward paying bills!

Thankfully, there are a number of ways to cut back on our monthly expenses to relieve those financial burdens.


With the emergence of so many available streaming services like Netflix and Apple TV, there are few reasons to have intense cable packages. Reduce your bill by downgrading to basic cable, or cut out your cable service entirely. Not only will you save money on your cable bill, but in reducing your TV viewing, you'll cut costs on your electric bill. Win-win!


It can be a major investment in time and energy, but it will pay you to renegotiate your home and car insurance. According to a Forbes article, "you could be missing out on a lower rate if you don't shop around for new insurance at least once a year." Insurance rates are always fluctuating, and it's a very competitive industry. So it's in your best interest to make sure you're paying the lowest possible rates (while at the same time ensuring your insurance policies give you the coverage you need.)


Although it's easier to pick up cleaning supplies at your local store, you'll save money by getting rid of these expensive products altogether. As writer, Clare Hudson, points out in a Lifehack article entitled 30 Ways to Cut Your Monthly Expenses, you can easily make your own cleaning products with household staples like vinegar, baking soda, and lemon juice. And they're just as effective (and usually less damaging to your family's health) than the expensive stuff.

It will take a concerted effort on your part, but there are ways to cut back on your monthly expenses.

Give it a try: the savings just might surprise you.

An Escrow Account Can Work in Your Favor
When you decide on your mortgage and lender, you may want to consider an escrow account.

This holds money to pay for your mortgage-related bills, such as property taxes and property insurance. And, while escrow accounts aren't mandatory, they do help you stay on top of your important bills.

Escrow accounts are usually held by your lender and can be set up when you take out a mortgage. To fund the account, you make an initial deposit. At that point, the lender calculates an amount to be added to your monthly mortgage payment. This may include insurance premiums and property taxes.

For example, if you purchase a home with property insurance totaling $100 a month, prior to closing you must pay the insurer $1,200 for the first year's coverage.

This $100 per month will then be added to your mortgage payment and held in the escrow account until it's needed to pay next year's insurance premium.

In the same way, the property tax amount will be added to your mortgage payments and held in escrow to pay your property tax bill.

These bills will be paid on your behalf from your escrow account, thanks to mortgage servicing (the handling of the daily functions of a mortgage.)

The responsibility for mortgage servicing can rest with your lender or a separate mortgage servicing company; both follow defined procedures and are regulated by the federal government.

The servicer will make adjustments to the escrow account annually, as property taxes and insurance premiums do change. If one expense is underestimated, you'll need to top up your monthly mortgage payment, or write a check for it. Overages will be refunded.

You may waive the escrow account, but your lender can require a higher down payment and/or credit score, and charge a premium on the rate, to compensate for assuming the added risk, if you don't pay your bills.
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Recipe: Broccoli and Shredded Chicken Salad
Serves 6
1 large head of raw broccoli
2 cups shredded rotisserie chicken
1/3 cup toasted sliced almonds
6-8 slices cooked bacon, roughly chopped
1 1/2 cups chopped celery
1 1/2 cups halved green seedless grapes
1 bunch spring onions, chopped
1 cup raisins
3/4 cup mayonnaise
3/4 cup plain yogurt
1/2 cup sugar
2 tablespoons white vinegar
Break broccoli down into even sized florets and add to a serving bowl with chicken, almonds, bacon, onion, grapes, celery and raisins.

In a smaller bowl whisk together mayonnaise, yogurt, sugar and vinegar. Add to serving bowl and toss to coat evenly. Season to taste with salt and pepper.

Can be kept refrigerated for up to four hours before serving.
This newsletter and any information contained herein are intended for general informational purposes only and should not be construed as legal, financial or medical advice. The publisher takes great efforts to ensure the accuracy of information contained in this newsletter. However, we will not be responsible at any time for any errors or omissions or any damages, howsoever caused, that result from its use. Seek competent professional advice and/or legal counsel with respect to any matter discussed or published in this newsletter. This newsletter is not intended to solicit properties currently for sale.
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