Four renovations to avoid when trying to sell!

December 3rd, 2015

Pricing-Strategies

1. Eliminating a bedroom: Even if the home owner plans to remove a bedroom in order to expand another one or make a living space larger, this renovation project likely could burn them at resale. The more bedrooms a home has, the higher the price it usually can get. “When you start eliminating bedroom space, you’ve completely changed the comparable value of your home in the neighborhood,” says David Pekel, president of Pekel Construction and Remodeling in Wauwatosa, Wis.

2. Renovating the garage into living space: Getting rid of the garage space in favor of an extra office, family room, or bedroom can be a turnoff to many potential buyers at resale, real estate professionals say. Seventy-four percent of recent buyers said that having a garage is extremely or very important, according to a survey of 7,500 people by Crescent Communities. For home owners who do choose to renovate the garage into living space, they may find leaving the garage doors on the outside a good move so that buyers could more easily convert the space back into a garage if preferable.

3. Removing closets: Michele Silverman Bedell, chief executive of Silversons in Westchester, N.Y., recalls a client who removed a closet out of the master bedroom in order to make a bigger master bath. But the renovation made the home much more difficult to sell, Silverman says. “People need closets,” she told MarketWatch. “They’ll walk in and count the number of closets per room.”

4. Too much wallpaper. While wallpaper can be removed, it has the reputation of being a lot of work to get it off.

TRID is here, and all is well!

November 24th, 2015

184d4dc116933536f6a251438c6b0991

It’s been six weeks since new closing rules took effect and aside from a few snags, the experience has been positive, according to the assessment of an industry panel at the 2015 REALTORS Conference & Expo in San Diego.

Anthony Lamacchia of Lamacchia Realty in Waltham, Mass., says the intent of the rule changes—to make it easier for home buyers to shop for and compare mortgage products—is a positive for the industry. And aside from the typical growing pains you would expect while real estate agents, lenders, and title agents familiarize themselves with what’s new, the transition has been smooth, with few instances of closings taking longer to complete. “I don’t have any issues with it,” he told several hundred real estate professionals attending the panel.

Dan Chiesa, vice president of national mortgage production at Quicken Loans, says his company has closed 3,800 loans since the changes took effect on Oct. 3. He said some were delayed but most closed no later than the typical loan prior to the new rules.

Under the changes, the Good Faith Estimate was replaced with a Loan Estimate and the HUD-1 Settlement Form was replaced by a Closing Disclosure. The Closing Disclosure must be given to buyers at least three days before closing to give them a chance to review the final numbers. The rules also include other disclosure and timing changes. The new process stems from the TILA-RESPA Integrated Disclosure (TRID) rule, which came out of 2010 banking reform legislation. The Consumer Financial Protection Bureau, which wrote the rule, calls it “Know Before You Owe” and has created a website to help agents understand the new process.

One recurring issue has to do with agents obtaining a copy of the Closing Disclosure. Some lenders, citing federal privacy rules, have been refusing to give a copy to agents, but panelists said there’s no reason agents can’t go to buyers directly and ask for a copy from them. Agents want the forms for their files and also use the information on them for inputting sold data in the MLS.

Another issue is confusion over which license number to put on the form. It asks for the “brokerage” number but it’s actually the agent’s license number that should be put on the form, the panelists said.

Avoid these 4 for a smooth sale!

November 18th, 2015

4th_1442413607

1. Covering up potential issues. Masking potential issues – from odors to a bad foundation – can be a costly mistake in the end, for the seller too. Serious defects that a seller knows about but fails to disclose can result in a buyer who backs out at the last minute, asks the seller to fix the issue, or even involve the seller into a lengthy legal battle after the transaction has closed.

2. Overpricing the home. A home that is not appropriately priced for the market can prompt many buyers to just overlook it. Sellers need to know that the price they paid for the home has no bearing or guarantee on its sales price when they go to list. The market condition of the home and comparing how recent nearby homes have performed will influence what their home is worth. A house sitting on the market because it’s overpriced will just deter interested buyers.

3. Failing to prepare the home before listing. Clean, decluttered, and neutral spaces are important in helping buyers to envision themselves living there. Sellers who keep an abundance of knick-knacks; dated, worn furniture; or overly bright, dark, or distracting colors can turn-off buyers.

4. Not being accommodating for showings. Sellers may be annoyed at constantly preparing for home showings or open houses but not having their home readily available for such buyer tours will likely prompt the home to linger on the market. Requested showing times or demanding to be present during showings can hamper the sales process.

Some strategies that help pay off your mortgage early!

November 10th, 2015

d62fb0e9-583f-4dd7-8796-9f4d56ffbf0c_177357895

An Extra Habit

Each time you pay extra on your mortgage, more of each payment after that is applied to your principal balance. Here are some options for paying extra and examples of how extra payments will affect the average $220,000, 30-year mortgage with a 4% interest rate:

  • Make an extra house payment each quarter, and you’ll save $65,000 in interest and pay off your loan 11 years early.
  • Divide your payment by 12 and add that amount to each monthly payment, or pay half of your payment every two weeks, also known as bi-weekly payments. You’ll make one extra payment each year, saving you $24,000 and shaving four years off your mortgage.
  • Round up your payments so you’re paying at least a few extra dollars a month.
  • Increase your payment when you get a raise or bonus.

Always check with your mortgage company before you make additional principal payments. Some companies will only accept extra payments at specific times or they may charge prepayment penalties. And always make sure the additional money is applied to the principal and not next month’s payment.

Refinance—or Pretend You Did

The only type of debt Dave won’t yell at you about is a fixed rate 15-year mortgage with a payment that’s no more than 25% of your take-home pay. You’ll pay much more in interest on a 30-year mortgage and, besides, who wants to be in debt for 30 years?

You can refinance a longer term mortgage into a 15-year loan. Or, if you already have a low interest rate, save on the closing costs of a refinance and simply pay on your 30-year mortgage like it’s a 15-year mortgage. The same goes for a 15-year mortgage. If you can swing it, why not increase your payments to pay it off in 10 years?

Using the same stats above for the average mortgage with a 15-year term, you’d need to bump up your monthly payment to about $2,200 to pay off your loan in 10 years. You’ll save $25,000 in interest, but best of all, you’ll be out of debt five years sooner and have $2,200 a month to invest for retirement, save for college, or give away!

Downsize

This could be a drastic step, but if you’re set on getting rid of your mortgage, consider selling your larger home and using the profit to buy a smaller, less expensive home.

With the profits from your home sale, you may be able to pay all cash for your new home, but even if you have to get a small mortgage, you’ve succeeded in reducing your debt. Now your goal is to get rid of it as quickly as possible. The smaller the balance, the quicker you can make it happen.

Consult a Pro to Find the Right Home

If you’re looking to buy a home that fits your budget, or you’re ready to sell your home, consult an experienced real estate agent whose advice will save you time and money. You can find a trustworthy real estate professional in your area through Dave’s nationwide Endorsed Local Provider (ELP) network. Contact your agent today!

A little Monday Money advice! Especially if you plan to buy a home!

November 9th, 2015

whats-wrong-with-traditional-money-management-advice

1. No-money-down plans

Want a new mattress? How about a payment plan with no money down? Never mind the fact that you’re financing a freaking mattress, now you also have zero “equity” in said mattress.

The no-money-down trap is simply another way to get you locked into making long-term payments on items you need to be buying outright. Instead of putting no money down, here’s a better idea: Save up some cash and put all the money down!

2. Payday loans

Life is moving along nicely when you get sideswiped by some unexpected financial emergency—the transmission goes out, your HVAC unit dies, your son breaks his leg on the basketball court.

Suddenly, you panic. Your emergency fund won’t cover the bills, so maybe some quick cash from a payday loan place would help?No!

These guys are the worst of the worst in the financial industry. Payday loans are a scam, and you’ll end up paying hundreds of percent in interest for that loan.  Take an extra job. Sell some stuff you don’t need. But whatever you do, stay way from the payday loan shops!

3. The car lease

The Smiths got a new BMW, and boy is it nice. That little beauty has a fancy GPS, satellite radio and seat warmers, and it smells so good . . . oh, the smell.

You love that BMW, and wouldn’t it be nice to trade in your old Honda for that? No matter that you’re still making payments on the Honda—that’s what leases are for, right? Wrong!  Leasing is the most expensive way to drive a car. Stay away from the fleece.

4. Timeshares

Someone offers you a free vacation. The only catch? You have to come to some “business meeting.” Easy enough, right? The problem is that in this meeting, you’ll get hounded to buy a timeshare.

Timeshares are generally marketed to people who can’t afford them. And if you ever want to sell one, good luck! You can’t give the things away. You’re better off putting your money in a cookie jar.

5. Adjustable rate mortgages (ARMs)

A decade ago, ARMs were all the rage. Then the housing market crashed, and many of the banks that made stupid loans either went under or had to get bailed out.

Either it’s a three-year or a five-year ARM, you can be certain that your interest rate will adjust, and you have no control over where it goes. You’re playing with fire when you get an ARM. Instead, play it safe with a 15-year fixed-rate mortgage.

How an Energy Audit can add value to your home!

October 29th, 2015

ID-10078435

1. Show you where to put the money

A home energy analysis such as the Home Energy Rating System Index provides a detailed report regarding energy problems and fixes. Results in hand, you’ll know where to put your home improvement dollars, making your home more attractive to prospective buyers.

2. Lower utility bills

Once you know where to make cost-effective fixes, you can pinpoint the return on investment on those upgrades, large or small. Repairing caulking, say, or sealing a fireplace may be key to reducing your monthly energy bills. Alternatively, a bigger investment, such as replacing old windows, could cost more upfront but make a bigger impact on the value of your home overall.

3. Competitive advantage

A theoretical buyer looks at two similarly priced houses in the same neighborhood. House No. 1 has an energy bill of $1,000 per year. House No. 2 clocks in at $3,000. The math is simple: Over the course of 10 years, House No. 2 would cost $20,000 more. Which is more appealing to buyers and worth a higher sales price? Memo to sellers: Be House No. 1.

4. Increase purchasing power of potential buyers

It may sound wild, but energy-efficient homes can actually leverage a homebuyer’s purchasing power if they apply for an energy mortgage. These mortgages work in two ways: A homebuyer adds a sum — say $4,000 — to a mortgage loan to finance energy-efficient upgrades. Though the monthly payments are higher, they’re offset by the new energy savings. Or buyers may qualify for a bigger loan if they can show that lower energy costs offset what they’d spend on a higher monthly mortgage payment.

5. Boost your market value

According to the Residential Energy Services Network (RESNET), the market value of a home increases by $20 for every $1 decrease in annual energy costs. Another study showed that in California, the value of a home increased by 9 percent ($34,800 for the average home) if it had energy labeling.

6. Improve indoor environments

Increasingly, homebuyers are seeking out homes that tout indoor air quality and home emissions as amenities. Energy-efficient homes tend to get checks in these new must-have boxes. With a cleaner HVAC system, fewer allergens and pollutants enter the home; and an efficient house is less polluting. Plus, ultimately (whether you care about being green or not), homes that cool and heat rooms effectively are simply more comfortable.

The 8 Home Inspection items you really need to be concerned with!

October 21st, 2015

ios-81. Termites and other live-in pests: The home you’ve fallen in love with may also be adored by the local termite population. The sooner termites are detected, the better. The same goes for other wood-devouring pests like powder-post beetles. Keep in mind that getting rid of the intruders is just the first step. Once the problem has been addressed, have a pest control expert advise you on what needs to be done in order to prevent their return.

2. Drainage issues: Poor drainage can lead to wood rot, wet basements, perennially wet crawlspaces and major mold growth. Problems are usually caused by missing or damaged gutters and downspouts, or improper grading at ground level. Correcting grading and replacing gutters is a lot less costly than undoing damage caused by the accumulation of moisture.

3. Pervasive mold: Where moisture collects, so grows mold, a threat to human health as well as to a home’s structure. Improper ventilation can be the culprit in smaller, more contained spaces, such as bathrooms. But think twice about buying a property where mold is pervasive — that’s a sign of long-term moisture issues.

4. Faulty foundation: A cracked or crumbling foundation calls for attention and repair, with costs ranging from moderate to astronomically expensive. The topper of foundation expenses is the foundation that needs to be replaced altogether — a possibility if you insist on shopping “historic” properties. Be aware that their beautiful details and old-fashioned charms may come with epic underlying expenses.

6. Worn-out roofing: Enter any sale agreement with an awareness of your own cost tolerance for roof repair versus replacement. The age and type of roofing material will figure into your home inspector’s findings, as well as the price tag of repair or replacement. An older home still sheltered by asbestos roofing material, for example, requires costly disposal processes to prevent release of and exposure to its dangerous contents.

7. Toxic materials: Asbestos may be elsewhere in a home’s finishes, calling for your consideration of containment and replacement costs. Other expensive finish issues include lead paint and, more recently, Chinese drywall, which found its way into homes built during the boom years of 2004 and 2005. This product’s sulfur off-gassing leads to illness as well as damage to home systems, so you’ll need to have it completely removed and replaced if it’s found in the home that you’re hoping to buy.

8. Outdated wiring: Home inspectors will typically open and inspect the main electrical panel, looking for overloaded circuits, proper grounding and the presence of any trouble spots like aluminum branch circuit wiring, a serious fire hazard.

1503 Summer Cloud DR, Edmond, OK 73013

October 16th, 2015

Just Listed and Open House this Sunday from 2-4! In Persimmons Creek Place ~ 1503 Summer Cloud Drive! Great townhouse in East Edmond with private awesome backyard and cul-de-sac lot. Living/dining kitchen all flows well for entertaining and family living. Powder room down with all bedrooms up with two full baths. Master bedroom with enclosed porch area and open deck overlooking backyard. Downstairs has enclosed patio and open patio and storage building on the side. Easy access to I-35, Broadway Ext and the Turnpike.

Oklahoma home buyer, the next few months should be your time! Read Why!

October 14th, 2015

fall_winter

Low mortgage rates, declining home prices, and homes that are lingering on the market longer are three main reasons why the next three months could be the best time to buy so far this year, says Jonathan Smoke, realtor.com’s chief economist.

“The spring and summer home-buying seasons were especially tough on potential buyers this year with increasing prices and limited supply,” Smoke says. “Buyers who are open to a fall or winter purchase should find some relief with lower prices and less competition from other buyers.”

The biggest challenge buyers will likely face buying in the next three months is the limited number of choices. There are fewer homes for-sale this fall than last year and housing inventory has already peaked for 2015, Smoke says.

In many markets, real estate is making its seasonal transition and is tilting in favor of home buyers lately.

Also, buyers are locking in low mortgage rates as the Federal Reserve continues to delay raising rates. For the past 10 weeks, the 30-year fixed-rate mortgage has averaged below 4 percent, according to Freddie Mac.

Here are some more factors pointing to a slowdown in the overall housing market:

  • Median home prices dropped 1 percent month-over-month in August (however, prices are still up 6 percent year-over-year).
  • Homes are staying on the market longer: The median age of home inventory is 80 days, up nearly 7 percent from August.
  • Mortgage applications dropped 6.7 percent week-to-week.

Time to Winterize your Home! Here’s a Helpful Checklist!

October 5th, 2015

Time to Winterize your Home! Here’s a Helpful Checklist!

Get your mind in the gutters. Your roof’s drainage system annually diverts thousands of gallons of water from your house’s exterior and foundation walls. That’s why it is so important to keep this system flowing smoothly. Clogged gutters can lead to damaged exterior surfaces and to water in your basement. They are also more prone to rust and corrosion. Before the leaves fly this fall, have your gutters cleaned, then covered with mesh guards to keep debris from returning.

Button up your overcoat. A home with air leaks around windows and doors is like a coat left unbuttoned. Gaps in caulk and weather-stripping can account for a 10% of your heating bills, according to the U.S. Department of Energy.

Weather-stripping is easily the most cost-effective way to rein in heating and cooling costs. This humble material also reduces drafts and keeps your home more comfortable year-round. Because weather stripping can deteriorate over time, it is important to inspect it periodically.

If you suspect a problem with weather stripping, you have several options for checking. Close a door or window on a strip of paper; if the paper slides easily, your weatherstripping isn’t doing its job. Or, close the door or window and hold a lighted candle near the frame. (Don’t let the flame get near anything flammable!) If the flame flickers at any spot along the frame, you have an air leak.

While you’re at it, also check for missing or damaged caulk around windows, doors, and entry points for electrical, cable, phone, gas, and so. Seal any gaps with a suitable caulk.

Get on top of roof problems. Few homeowner problems are more vexing than a leaky roof. Once the dripping starts, finding the source of the problem can be time-consuming. Stop problems this fall before ice and winter winds turn them from annoyances into disasters.

Here’s how: Inspect your roof from top to bottom, using binoculars if necessary. Check ridge shingles for cracks and wind damage. Look for damage to metal flashing in valleys and around vents and chimneys. Scan the entire roof for missing, curled, or damaged shingles. Look in your gutters for large accumulations of granules, a sign that your roof is losing its coating; expect problems soon. Finally, make sure your gutters are flowing freely.

Note: Roof-mounted television antennas, even if they aren’t in use, may have guy wires holding them in place. Look for loose or missing guy wires. If you see some, and your antenna is no longer being used, consider having it removed altogether.

Walk the walks (and drives). Damaged walkways, drives, and steps are a hazard year round, but their dangers are compounded when the weather turns icy. Fixing problems in the fall is also critical to preventing little problems from becoming expensive headaches.

Look for cracks more than 1/8-inch wide, uneven sections, and loose railings on steps. Check for disintegration of asphalt, or washed-out materials on loose-fill paths.

Most small jobs are well within the ability of a do-it-your-selver, but save major repairs for experienced hands.

Chill out. If you live in an area with freezing weather, take steps to ensure that outside faucets (also called sill cocks) and in ground irrigation systems don’t freeze and burst.

Here’s how: Close any shut-off valves serving outside faucets, then open the outside faucet to drain the line. (There may be a small cap on the faucet you can loosen to facilitate this draining.) If you don’t have shut-off valves, and your faucets are not “freezeproof ” types, you may benefit from styrofoam faucet covers sold at home centers.

To freezeproof an inground irrigation system, follow the manufacturer’s procedure for draining it and protecting it from winter damage.

Freshen your filter. Furnace filters trap dust that would otherwise be deposited on your furniture, woodwork, and so on. Clogged filters make it harded to keep your home at a comfortable temperature, and can serious increase your utility bills. A simple monthly cleaning is all it takes to keep these filters breathing free and clear.

Here’s how: Disposable filters can be vaccumed once before replacement. Foam filters can also be vaccumed, but they don’t need to be replaced unless they are damaged. Use a soft brush on a vacuum cleaner. If the filter is metal or electrostatic, remove and wash it with a firm water spray.

Give your furnace a physical. Once a year, it’s a good idea to have your heating system inspected by a professional. To avoid the last-minute rush, consider scheduling this task in early fall, before the heating season begins.

Here are signs that you should have an inspection performed sooner:

Noisy belts. Unusual screeches or whines may be a signal that belts connected to the blower motor are worn or damaged.

Poor performance. A heating system that doesn’t seem to work as well as it once did could be a sign of various problems. Your heating ducts might be blocked, the burners might be misadjusted, or the blower motor could be on its last legs. One check you should be sure to conduct: Make sure your furnace filter is clean.

Erratic behavior. This could be caused by a faulty thermostat or a misadjusted furnace.

Gather round the hearth. Even if you use your fireplace only occasionally, you should check it annually for damage and hazards.

Inspect your flue for creosote. Creosote is a flammable by-product of burning wood. If it accumulates in a flue or chimney, the result can be a devastating fire. Have your chimney inspected annually for creosote buildup. If you use a fireplace or wood stove frequently, have the flue inspected after each cord of wood burned.

For most people, the best option is to have your entire chimney system inspected by a chimney sweep. Once you know what to look for, you can perform the inspection by shining a bright flashlight up the flue, looking for any deposits approaching 1/8 inch thick. These deposits should be cleaned by an experienced chimney sweep.

Look for flue blockages. Birds love to nest at the top of an unprotected flue. A chimney cap can prevent this from happening. If you don’t have a cap, look up the flu to ensure that there are no obstructions.

Exercise the damper. The damper is the metal plate that opens and closes the flu just above the firebox. Move it to the open and closed positions to ensure that it is working properly.

Check your chimney for damage. Make certain that the flue cap (the screen or baffle covering the top of the chimney) is in place. Inspect brick chimneys for loose or broken joints. If access is a problem, use binoculars.

Keep the humidifier humming. You may know that bone dry winter air is bad for your health, but did you also know it can make fine wood more prone to cracking? You and your home will feel more comfortable if you keep your central humidifier in tip-top shape during the months it is running.

Here’s how: First, inspect the plates or pads, and if necessary, clean them in a strong laundry detergent solution. Rinse and scrape off mineral deposits with a wire brush or steel wool.

Head-off gas problems. Keeping a gas heater in good shape is both a safety and a cost issue. An improperly maintained heater can spew poisons into the air of your home, or it may simply be costing you more to operate. Have a professional check these devices annually. There are also some maintenance items you should address.

Here’s how: First, shut off the heater. Then check the air-shutter openings and exhaust vents for dirt and dust. If they are dirty, vacuum the air passages to the burner and clean the burner of lint and dirt. Follow the manufacturer’s advice for any other needed maintenance.

Keep the wood fires burning brightly. Woodburning stoves are a great way to add atmosphere and warmth to your home. But regular inspections are needed to ensure that these devices don’t become a safety hazard. Here’s how to check them.

Inspect stovepipes. Cracks in stovepipes attached to wood stoves can release toxic fumes into your home. Throughout the heating season, you should check for corrosion, holes, or loose joints. Clean the stovepipe, and then look for signs of deterioration or looseness. Replace stovepipe if necessary.

Look for corrosion and cracks. Check for signs of rust or cracking in the stove’s body or legs.

Check safety features. Make sure that any required wall protection is installed according to the manufacturer’s specifications and that the unit sits on an approved floor material. If you have young children, be sure to fence off the stove when it is in operation.

At least once a year, do a top-to-bottom review of your home’s safety features. This is also a good time to get the family together for a review of your fire evacuation plan. Here’s how to do this:

Smoke and CO detectors. Replace the batteries in each smoke and carbon monoxide (CO) detector, then vacuum them with a soft brush attachment. Test the detectors by pressing the test button or holding a smoke source (like a blown-out candle) near the unit. If you haven’t already, install a smoke detector on every floor of your home, including the basement.

Fire extinguishers. Every home should have at least one fire extinguisher rated for all fire types (look for an A-B-C rating on the label). At a minimum, keep one near the kitchen; having one per floor isn’t a bad idea. Annually, check the indicator on the pressure gauge to make sure the extinguisher is charged. Make certain that the lock pin is intact and firmly in place, and check that the discharge nozzle is not clogged. Clean the extinguisher and check it for dents, scratches, and corrosion. Replace if the damage seems severe. Note: Fire extinguishers that are more than six years old should be replaced. Mark the date of purchase on the new unit with a permanent marker.

Fire escape plans. Every bedroom, including basement bedrooms, should have two exit paths. Make sure windows aren’t blocked by furniture or other items. Ideally, each upper-floor bedroom should have a rope ladder near the window for emergency exits. Review what to do in case of fire, and arrange a safe meeting place for everyone away from the house.

General cleanup. Rid your home of accumulations of old newspapers and leftover hazardous household chemicals. (Check with your state or local Environmental Protection Agency about the proper way to discard dangerous chemicals.) Store flammable materials and poisons in approved, clearly labeled containers. Keep a clear space around heaters, furnaces, and other heat-producing appliances.house-warm-fix-300x300