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Q:Wewantto buya home inthe next fewmonths. We have $40,000 in cash but also $8,000 in credit card debt. Should we payoffthe credit cards? A:Therearea numberofunknowns heresuchashowmuch youexpecttopayfora home,thesizeofother debtssuchascarsand studentloans,andyour income.Thatsaid,you haveenoughcashto consideroptions. TheFederalReserve reportsthatasoflate 2020—whenmort- gageratesreacheda historiclowof2.66% —thetypicalcredit cardborrowerwas payinganaverage interestrateof16.28%. Foran$8,000debt at16.28%theannual interestcostis$1,302 or$108.50amonth. Thepubliciscatch- ingon.Datafrom WalletHub'sCredit CardDebtStudyshows thatAmericansare ditchingcreditcards butthatmanyhouse- holdscontinuetocarry highbalances.The WalletHubfiguresfor Marchshowseveral interestingtrends. In2020creditcard debtfellby$82.9 billion.Fortheprevi- ousdecadeAmericans hadaddedanaverage of$54.2billioninnew creditcarddebtper year. Averagecreditcard debtamountedto $8,089perhousehold attheendof2020, down12%inayear. Astheeconomy reopensin2021, WalletHubexpects creditcarddebtto increaseby$50billion thisyear. Intermsofreal estate,creditcarddebt isaconcernbecauseof themonthlycostand thepotentialforcredit dingsifapaymentis lateormissed. Lendersfocusona numberofmeasures whentheyreview mortgageapplications. Oneofthemostimpor- tantisthedebt-to- incomeratioorDTI. Inbasictermsthere aretwoDTImeasures. Thefirst—the"front ratio"—compares monthlyhousingcosts withgrossmonthly income.Thesecond —the"backratio"— includesrequireddebt paymentsforsuch thingsasautoloans, studentdebt,housing costsandcreditcards. WithFHA-backed loans,asanexample, borrowersgenerally needafrontratioof notmorethan31%and abackratioof43%. However,itispossible tohaveevenhigher percentagesandthe backratiocansome- timesexceed50%.In fiscalyear2020,HUD reportedthatalmost aquarteroftheloans itinsuredhadDTIsof 50%orabove. There'salotofrisk tolendersandmort- gageinsuranceplans withhighDTIs.With moreriskcomeshigher rates,moreexpensive financingandmore mortgageapplica- tionrejectionsfor marginally-qualified borrowers. Inasituationwhere youhave$40,000in cashand$8,000in creditcarddebt,speak withlendersandask howbesttouseyour funds.Withsufficient incomethemonthly paymentsmaynotbe aDTIproblem.But, ifyourDTIratioisa concern,thenrunthe numberstoseehow adebtpayoffcould impactamortgage applicationinyour situation. Emailyourreal estatequestionsto PeterMilleratpeter@ ctwfeatures.com. Should you purchase a home while carrying debt? MarketWatch By Peter G. Miller Perpetual frompage1 TheTidesatNew- portinWestSacra- mentoisnowselling. Withonly36homes available,youdon't wanttomissyourop- portunitytoown.Call oremailtodaytosched- uleyourappointment. Thisbrand-new communityfeatures two-storyhomesrang- inginsizefromapprox- imately2,377square feetto2,812squarefeet withfourtofivebed- roomsandtwo-and-a- halftofourbathrooms. TheTidesconsistsof threedifferentfloor plans,allboasting gourmetkitchens,spa- ciousmastersuites, loftsandsecond-floor laundryrooms.The ArroyoandCovefloor plansalsoincludea downstairsbedroom andbathroom.Enjoy thecomfortsofstan- dardfeaturessuchas 9-footceilingheights,a kitchenappliancepack- age,granitekitchen countertops,LED lighting,tanklesswater heaterandsolarpanels! AtTheTides,you willfindanidealset- tingjustminutesfrom downtownSacramento, theSacramentoRiver, theAmericanRiver, severalparksandTree TopSac.Shoppingand diningarejustashort walkawayattheSouth- portTownCenter. DiscoveryandSeeno Homesarededicated toembodyingtheidea oftheDiscoveryDif- ference,amissionto enhanceyourbuying experienceandoffer newhomesthatexem- plifythehigheststan- dardsofcraftsmanship. Eachoftheircurrent andupcomingnew- homecommunities throughoutNorthern Californiahasitsown distinctivecharacter andaresetinthemost- sought-afterlocations. Theselocationsinclude Concord,Martinez, Oakley,Pittsburg,Oak- land,Fairfield,Vaca- ville,WestSacramento, ChicoandNapa.Their sensitiveapproachto designresultsinhomes thatarepracticalyet possessatimeless elegance.Roomand designoptionsineach homeallowhomebuy- erstocustomizetheir homesoitistailored tofittheirfamily'spar- ticularneeds. Throughtheyears, homebuyershave maintainedapride ofownershipineach DiscoveryandSeeno Homesneighborhood thatisunparalleledin theindustry.Inorder tomaketheentire homebuyingprocess asimpleandpleasant experience,Discovery andSeenoHomesoffer lenderserviceson-site atthecommunities,as wellastheDiscovery Designcenter,where buyerschoosetheir interiordesignselec- tionstheyhavealways dreamedof.Withthese partnerships,Discov- eryHomesandSeeno Homesareproudto makeone-stopshop- pingareality. As forcustomer service, theystriveto makeyour homebuy- ingexperience simple, efficientand enjoyable because Discoveryand Seeno Homes are mo- tivated by the sincere desire to enhance the livesof homebuyers, and to create aplace you are proud to call home. VisitaDiscovery orSeeno Homes com- munitytodaywhere you can experience foryourself how eight decades of quality craftsmanship allows you to discover the best inlife. TheTidesatNew- portisat1816Stetson Circle,locatedatStone- gateDriveandLake WashingtonBoulevard inWestSacramento. Findoutmorebycall- ing(916)572-0636, emailingthetides@ discoveryhomes.comor exploringthewebsiteat seenohomes.com. Contentprovidedby SeenoHomes The Tides at Newport — new homes in West Sacramento This is The Cove floor plan at The Tides at Newport. It is one of three two-story floor plans now available at this West Sacramento new-home community. Thereare manyrea- sonstoaddan ADU. Somebuyerswantto bringinextrarental income,otherslove havingaprivateretreat whereagingparents orlovedonescanlive. Rentingoutyourmain houseandlivinginan ADUinyourbackyard is becomingpopularas well. In manycases, the mainhouserentcovers bothmortgages. "Thousands of new ADUs are being built in communities across the U.S. because they are a manageable and minimally disrup- tive option for adding desperately needed housing to exist- ing neighborhoods," says Kathy Anderson, founder and managing partner of Perpetual Homes. Perpetual Homes' ADUs cost ap- proximately 50% less than the on-site "stick built" contractor ver- sion and provide a much cleaner job site. Newlawsalso make iteasier to addan ADU inCaliforniathan ever before, includingno minimumlotsize is required;sideyard and rear yard setbacks of only 4feetare allowed; no owner-occupant condition;and no city ormunicipalityimpact fees under 750square feetforan ADU. Findout more about ADUs, the building process and interior designat https:// perpetualhomesadu. com/ orcall(925)980- 2351. Perpetual Homes ADUsislocated at 4115BlackhawkPlaza Circle,No.100, in Danville. Contentprovidedby PerpetualHomesADU Over 21 years experience and 5 star Yelp reviews Bayview Residential Mortgage 51 E. Campbell ave #110 Campbell, CA 95008 CA Broker DRE#01498198/ NMLS#329189 Call today for rate quote! Rob Heath 408-482-8080 CA DRE#01241953/NMLS#319548 Apply at my personal secure loan application at www.excellentmortgageloan.com Product Rate Points Fees % Down APR 30 Yr Conf. Fixed 15 Yr Fixed 5 Yr Jumbo ARM 30 Yr Conf. Jumbo 3.125 2.75% 3.25 3.50 0.000 0.000 0.000 0.000 $0 $0 $0 $0 20% 20% 20% 30% 3.125% 2.75% 3.67% 3.50% JUMBO REVERSE MTG, 5* Yelp reviews. NO CLOSING COST LOANS are available. 3.125% 30yr Conf Fixed 2.75% $0 UW $0 UW $0 UW $0 UW 2.75% 2.75% 3.00% 3.375% 0.00 2.25% 2.25% 40% 20 Yr. Conf. Jumbo 15 Yr Conf. Fixed 30 Yr Fixed APR 3.00% 40% 40% 2.75% Product Rate Points Fees % Down APR 2.75% 30 Yr Fixed APR H6 BAYAREANEWSGROUP 111 Homes | Advertising Section