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Newsletter from Montana
February 2004
Newsletter from Red Lodge, Montana
Just for fun and games and because winter is kind of slow regarding real estate, I thought I would take a class in lending, so I can offer that service to my customers, who quite often like to get a mortgage when they buy a home. Well, I took the class, passed the test and hired on with a national company, I am now an order taker for loans and can do that nationwide, new loans and refinancing. In the process of doing that, I got my cage rattled a bit. I learned that most Americans are 90 days away from bankruptcy! Bankruptcy is at an all-time high because people loose their jobs, can't make payments on their home, the bank forecloses after 90 days and bingo. Yikes! I called our local bank and asked if someone is out of a job, but has a lot of equity in their home, can they take a loan to make the house payments? They laughed me out the door! So if you owe any money on your home at all, it would be wise to take the largest loan possible while you still have a job, put it into a savings account that brings interest to offset the loan cost or better, and then if you have to pay a college tuition, major medical expenses or heavens forbid loose your job, you can still make the payments and don't go belly up. Not only that, the interest on your home loan is tax deductible, while any principal paid on your home is not. It is like putting money under your mattress, except the money in your home is impossible to get back out when you really need it, except when you are a senior citizen and can make use of a reverse mortgage. I wrote some more about money matters, but I am pasting it below my signature.
If you would like to get into the lending business yourself, under the link to the rates,
is a link to sign up for employment.
Because you are being employed by a nationwide company you don't need to be licensed in a certain state and the forms you need in order to comply with the state you live in, are posted right on that page. The company is licensed in the lower 48. The schooling and testing costs $ 225.- and will take a day or two, but can be done on the computer. I think this is a great service you can provide if you are a real estate agent, sell insurance or just have to do with a lot of people anyway. It might save a few souls from bankruptcy, since this kind of math is not widely publicized. If you need a lending glossary,
I posted a link on my finance page
If you rather work on a ranch than on a computer, the dude ranch association
posted a help wanted section.
Or forget about work all together
and go fishing
I also just bought a book about fishing the hundreds of lakes here in the mountains. It gives the species, how often the lake is stocked, how hard they are to catch, how deep the lake is and how to find it. "Fishing the Beartooth" by Pat Marcuson (a Falcon Guide, ISBN 1-56044-434-7)
If you like to fish and hunt or just love the wild things, would you like to own an affordable vacation home next to 3.2 million acres of Wilderness, near one of the best trout streams in Montana and a measly 14 mile hike to the Yellowstone Park with virtually hundreds of deer wandering the country side?
I just listed a building lot there for $ 19,500
and a fully furnished one bedroom 1.5 bath condo that would
sleep four people for $ 72,000
Both are in the Cathedral Mountain Subdivision, which is a gated community right in the mountains and adjacent to the National Forest, with three lakes that are stocked with fish and a lodge you can use for entertaining with Pool and Ping-Pong tables, kitchen, dining room and lounge. In the near future there will also be a stable available, so you can bring your horses. And if you are not home, there is a full-time caretaker couple who will check on your home, plow the roads in winter and hire out for cleaning. Such a deal! About a mile from this subdivision is the local bar, a post office, fire station and the general store of Nye. Five miles up the road is an excellent restaurant. For skiing and golfing you have to come to Red Lodge, which is about 55 miles from there. Red Lodge by the way has more restaurants per capita then any other city in Montana!
This subdivision
has its own website
and its own weather station, which inspired me to get a weather station for our airport here in Red Lodge and to post it
on our websites as well
Now we can keep tab on those warm and dry Chinook winds that descend from the easterly slope of the Rocky Mountains and keep the bananas growing. Hence the name "Banana Belt of the West" ;-) That reminds me, did you know that Montana had a tropical climate for 10 million years? All that is left of that era are those beautiful red rocks of the preserved tropical soil you can see here and there.
If you like to live here and are reminiscent of the tropics, you could have a pond installed in your backyard, and here is the lady to talk to: Marnie Johnson of Montana Ponds Inc. Her email is gjohnson@imt.net
You might want to consider growing the changeable water lilies, they are variations of yellow with flowers that change hue during the bloom period. Not only are they beautiful, but they are useful in creating an environmentally balanced pond. The water lily pad, resting on the water's surface, naturally insulates the pool. It reflects heat during the day and holds heat in at night, thus stabilizing water temperature and assisting in algae control. It also takes nutrients out of the water which helps to starve algae. In order to environmentally balance a pool 40-60 percent of the water surface should be covered with floating foliage.
Water lilies are one of the plants used.
Another good way to spend a day, is to play piano. We have an excellent
piano store in Billings on Grand Avenue.
It is owned by Louis Spencer-Smith, a German immigrant, just like myself. Of course he sells Steinway, Schimmel, Bösendorfer, etc. and provides music related services. He speaks English with a Limey accent. Figure that! :-)
If you click on the link for
"Montana Economy"
There is now a highlighted link in the left margin to the Bureau of Business and Economic Research for Montana. Quite an interesting site, "For more than 50 years, the Bureau of Business and Economic Research has worked to help Montanans understand their state and make informed decisions in their personal and professional lives."
The Western Business News had an
article on Red Lodge
I put a link to the paper in the left margin of my main websites.
Here are some highlights of the article:
"Ski visits in January were running about 5 percent below last year. But last year was a phenomenal year, said Chip Vicary, chief financial officer of Red Lodge Mountain Resort. The winter of 2002-2003 was a record snow year, at least since the resort started keeping accurate records for snow. The mountain had 325 inches during the ski season and over 400 inches adding in the snow that fell in late April and May.
"This summer will see the start of Red Lodge Mountain Homes North at the golf course in the year-round recreation community of Red Lodge. The development is the fourth built by Langlas Homes Inc., which also builds homes in Billings and Bozeman. The residences are part of an association that takes care of the lawns, snow removal and maintenance, so owners who are not there year-round or rent to other vacationers have some assurances that their property is being taken care of, Langlas said
When Red Lodge Mountain Homes North is complete, there will be about 70 homes among all four sections of the golf course development. As it is in Billings and around the nation, the residential market is strong in Red Lodge, Langlas said, and he anticipates it will continue to be so.
.
Red Lodge Mountain Resort did about $525,000 of capital investment in summer 2003. The investment was easier to do after record snow, Vicary said.
However, some of the improvements are not generally visible to visitors, nor are they trumpeted in brochures. But a big upgrade of the sewer system was necessary as was a big electrical transformer and power loop upgrade, which cost more than $60,000.
More noticeable would be the two new Snow Cats for grooming the mountain and four new snow guns, bringing the resort's "fire power" up to 16. All the public areas of the buildings also got new carpet, and the Bierstube received new bathrooms. On top of that, the resort bought almost $55,000 of new rental skis and snow boards to replace older equipment.
"Red Lodge's future is in tourism and tourism promotion," Vicary said.
A company that is active in promoting Red Lodge is Creative Design Works, owned by Tim Weamer and Jenny Zimmerman.
"Tourism is definitely important to the economy. I think it is underrated," Weamer said.
The company does work for Red Lodge Mountain Resort and the chamber of commerce, and it owns the Web sites redlodge.com and shopredlodge.com. (Tim Weamer, Creative Design Works
406-446-4402, tim@redlodge.com)
"The Internet is the biggest thing that has created growth by far," he said.
The chamber-sanctioned site redlodge.com gets in the neighborhood of 500 unique visitors a day, he said.
"In the six months that we have had a link on redlodgecom for the travel planner packets, we have had 1,800 requests from all 50 states and nine foreign countries."
Weamer says he has talked with people who had received the travel packet and moved to Red Lodge.
"To me that, again, is the power of the Internet," he said. "It's a great marketing tool. The more we get used to it, the more important it is to have a good presence on it."
The lodging business last summer was way ahead of the summer before, said Lee Tower, owner of Red Lodge Reservations and Beartooth Property Management.
The fires at the east entrance to Yellowstone National Park at Cody, Wyo., and the absence of fires near Red Lodge, drove a lot of people in Red Lodge's direction, he said.
Summer 2004 could also be good for businesses.
"Right now my bookings for summer 2004 are far outpacing last summer," he said. "I think the marketing effort of the lodging association has paid off."
"Over half of our visitors are from the surrounding states," Tower said.
And at last "The Wonder of it All"
http://wonderofitall.com/
Be well until my next newsletter at the end of March - and if money is of interest to you, scroll down…
Cheerfully,
Dorothea
¤º°`°º¤ø,¸¸,ø¤º°`°º¤ø,¸¸,ø¤º°`°º¤ø,¸¸,ø¤º°`°º¤ø,
More about money….
If you have a standard 15 or 30 year fixed mortgage loan on your home, you lose 90% of your money.. After five years of paying, your balance is basically the same, and you have just paid much higher interest charges during that time then you would have paid for an interest-only loan.
Even though you might pay a higher interest rate if you put less money down on your home and pay no principal into your home, you can recover a multitude of that by investing your money into a savings account instead and actually pay off the home sooner… Paying principle on a mortgage is like a gangster forcing you to pay hundreds of dollars each month against your will. "IF you pay consistently for 30 years, I'll be a nice guy and give you the deed to the house you are living in free and clear. IF you miss 3 payments, I'll take your house and put you and your family on the street. Sound like a deal? Sign here and let's get started!"
What a crazy world, but I can understand the standpoint of the bank, they want your home with you owing the least amount of money, so they can be sure they get all their money even in a fire sale. I know the amount you are going to pay on your home with all the interest looks exorbitant, but then when you put your money into savings, it does exactly the same thing, it doubles every now and then. $ 10,000 at 4% interest doubles every 18 years and at 8% interest it doubles every 9 years. Divide 72 by the interest rate you are getting and you have the year when your money will double. Your home does not lose any value if you don't feed it equity, it doesn't matter how much you owe on the home, the home's value is determined by the market, not on how much you owe on it. So instead of putting your money into the home, put it into savings and just make interest payments on your home. You will be able to pay off your home MUCH faster!
If you would have bought a home in 1970 for $ 23,500 - that was the going rate then, your payments would have been around $ 140.- a month which was outrageous in 1970, but now that wouldn't even be enough for a car payment. So payments "shrink" over time. Nobody will take your home away if you are able to make the payments, and you will avoid a lot of trouble if you stay fluent with your hard earned dollars. Not only that, but if you pay towards the equity in your home, that money is AFTER taxes, so each $ 100.- you put into your house actually cost you $ 150.- or $ 200 depending on your tax bracket! If you use the same money and put it into an IRA, 401, SEP, etc. you can put your money in there BEFORE you even pay any taxes on it, so that is a tremendous saving right there besides the interest rate you receive. Come to think of it, the interest you pay on credit cards is also paid AFTER you have already paid your taxes on the money. So it would make sense to pay those off with the money you take out of your house, since the interest you pay on a mortgage is money BEFORE tax. If you pay 18% interest on your credit card, you are actually paying 30-40% - if you pay it off with a mortgage on your home, you are paying 3-4% because you are paying that interest BEFORE taxes. Take a look at your car loan, you are making those payments AFTER taxes and the interest is NOT deductible, while the loan you have on your home IS.
If you had two identical houses, both valued at $200,000. One family has $100,000 paid off on their mortgage. The other has only $10,000 paid off on their mortgage. Both families get in a financial bind and are going into foreclosure. Which family would you want to be? --Which house do you think the bank will take first? Is that fair? Do they care?
Best Regards,
Dorothea Lowe, Broker
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