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  • How strong is your credit? Cleaning up your credit is essential before you make any major financial moves. Having a bad score can hurt your chances of being able to open a credit card, apply for a loan, purchase a car, or rent an apartment.

    It is especially important to have clean credit before you try to buy a home. With a less-than-great score, you may not get preapproved for a mortgage. If you cant get a mortgage, you may only be able to buy a home if you can make an all-cash offer.

    Or if you do get preapproval, you might get a higher mortgage rate, which can be a huge added expense. For example, if you have a 30-year fixed rate mortgage of $100,000 and you get a 3.92% interest rate, the total cost of your mortgage will be $170,213. However, if your interest rate is 5.92%, youll have to spend $213,990 for the same mortgage - thats an extra $43,777 over the life of the loan! If you had secured the lower mortgage rate, you could use that additional money to fund a four-year college degree at a public university.

    So now that you know how important it is to maintain a good credit score, how do you start cleaning up your credit? Here, weve collected our best tips for improving your score.

    Talk to a loan professional

    You can protect your score from more damage by getting a loan professional to check your credit score for you. A professional will be able to guide you to whether your score is in the good range for home buying. Plus, every time that you request your own credit score, the credit companies record the inquiry, which can lower your score. Having a professional ask instead ensures that you only record one inquiry. Once you know your score, you can start taking action on cleaning up your credit.

    Change your financial habits to boost your score

    What if your score has been damaged by late payments or delinquent accounts? You can start repairing the damage quickly by taking charge of your debts. For example, your payment history makes up 35% of your score according to myFICO. If you begin to pay your bills in full before they are due, and make regular payments to owed debts, your score can improve within a few months.

    Amounts owed are 30% of your FICO score. What matters in this instance is the percentage of credit that youre currently using. For example, if you have a $5000 limit on one credit card, and youre carrying a balance of $4500, that means 90% of your available credit is used up by that balance. You can improve your score by reducing that balance to free up some of your available credit.

    Length of credit history counts for 15% of your FICO score. If youre trying to reduce debt by eliminating your credit cards, shred the card but DO NOT close the account. Keep the old accounts open without using them to maintain your credit history and available credit.

    Find and correct mistakes on your credit report

    How common are credit report mistakes? Inaccuracies are rampant. In a 2012 study by the Federal Trade Commission, one in five people identified at least one error on their credit report. In their 2015 follow-up study, almost 70% thought that at least one piece of previously disputed information was still inaccurate.

    Go through each section of your report systematically, and take notes about anything that needs to be corrected.

    Your personal information

    Start with the basics: often overlooked, one small incorrect personal detail like an incorrect address can accidently lower your score. So, before you look at any other part of your report, check all of these personal details:

    Make sure your name, address, social security number and birthdate are current and correct.Are your prior addresses correct? Youll need to make sure that theyre right if you havent lived at your current address for very long.Is your employment information up to date? Are the details of your past employers also right?Is your marital status correct? Sometimes a former spouse will come up listed as your current spouse.

    Your public records

    This section will list things like lawsuits, tax liens, judgments, and bankruptcies. If you have any of these in your report, make sure that they are listed correctly and actually belong to you.

    A bankruptcy filed by a spouse or ex-spouse should not be on your report if you didnt file it. There shouldnt be any lawsuits or judgments older than seven years, or that were entered after the statute of limitations, on your report. Are there tax liens that you paid off that are still listed as unpaid, or that are more than seven years old? Those all need to go.

    Your credit accounts

    This section will list any records about your commingled accounts, credit cards, loans, and debts. As you read through this section, make sure that any debts are actually yours.

    For example, if you find an outstanding balance for which your spouse is solely responsible, that should be removed from your report. Any debts due to identity theft should also be resolved. If there are accounts that you closed on your report, make sure theyre labeled as closed by consumer so that it doesnt look like the bank closed them.

    Your inquiries

    Are there any unusual inquiries into your credit listed in this section? An example might be a credit inquiry when you went for a test drive or were comparison shopping at a car dealer. These need to be scrubbed off your report.

    Report the dispute to the credit agency

    If there are major mistakes, you can take your dispute to the credit agencies. While you could send a letter, it can be much faster to get the ball rolling on resolving a mistake by submitting your report through the credit agencys website. Experian, Transunion and Equifax all have step-by-step forms to submit reports online.

    If you have old information on your report that should have been purged from your records already, such as a debt that has already been paid off or information that is more than 7 years old, you may need to go directly to the lender to resolve the dispute.

    Follow up

    You must follow up to make sure that any mistakes are scrubbed from your reports. Keep notes about who you speak to and on which dates you contacted them. Check back with all of the credit reporting companies to make sure that your information has been updated. Since all three companies share data with each other, any mistakes should be corrected on all three reports.

    If your disputes are still not corrected, you may have to also follow up with the institution that reported the incident in the first place, or a third-party collections agency that is handling it. Then check again with the credit reporting companies to see if your reports have been updated.

    If you can keep on top of your credit reports on a regular basis, you wont have to deal with the headaches of fixing reporting mistakes. You are entitled to a free annual credit report review to make sure all is well with your score. If you make your annual credit review part of your financial fitness routine, youll be able to better protect your buying power and potentially save thousands of dollars each year.

    How to clean up your credit now

    Does your credit score need a boost so you can buy a home? Get in touch with me. I can connect you with the right lending professionals to help you get the guidance you need.

  • If you are interested in where the lending industry is now, post recession and Dodd Frank regulation vs. where it has to get to in order to adequately meet the needs of a changing economic landscape, this is a must watch interview with the President of the Mortgage Bankers Association, Dave Stevens.

    scroll down to get to the video...

  • Inflatable, portable PhotonGrill cooks your food with nothing but the sun

    The barbecue of the future is here. Meet PhotonGrill, an inflatable 100 percent solar-powered grill that lets you ditch the charcoal for greener cooking. Perfect for camping and areas with fire bans, the lightweight, fire-free and fuel-free PhotonGrill is designed for portability and easily folds down to fit in a backpack. The best part? Its NASA-inspired technology is so efficient the grill reaches 500F in just five minutes.

    Recently launched on Kickstarter, the PhotonGrill is available at a discount for early bird backers and comes with a lightweight carrying case, solar-optimized pan, BBQ tongs, and an air pump. The portable and durable grill weighs only seven pounds and can easily be set up in just three minutes. A pot can also be attached for cooking. An optional add-on module will transform the PhotonGrill into a highly efficient power generator so you can charge your electronics with sun-powered electricity wherever you go.

    Heres how the PhotonGrill works: once fully inflated, the grill, made of lightweight plastic film, takes on the form of a reflective parabolic mirror that concentrates the energy contained in the rays of light into a small area, creating highly-localized energy thats powerful enough to cook with. The design team says the technology was based on experiments carried out by NASA in the 1960s

    By using heat to thermally deform the plastics polymers structure, the plastic is able to remember and transform into the desired parabolic shape when inflated, says the PhotonGrill team, who also claim the grill has 1,000 watts of power. Set atop a stable tripod, the parabolic mirror is made with highly robust polymer foils tested to ensure they can withstand all contingencies, even a large splash of boiling grease. PhotonGrill is looking to raise $111,964 on Kickstarter to bring the solar-powered grill to production.

    Courtesy of California Association of REALTORS. Click Here for Original article.

  • Strengthening Economy

    Despite existing-home sales dropping last November, the National Real Estate Market is primed for expansion in 2016. Here's why. Better weather in many parts of the country resulted in an increase in single-family and multifamily home construction. Also, the population of millennial homebuyers is expected to grow in 2016. This means increased demand to help the housing market see positive gains. With unemployment steadily decreasing, orders for new durable goods increasing 3 percent, inflation staying level, and income beginning to grow, the Fed decided to raise interest rates. The rate increase signals that our economy is getting stronger. So, don't let the drop in existing-home sales in November fool you, with a stronger economy home sellers can expect eager home buyers in 2016.

    Millennial Home Buyers

    The low demand in November meant that first-time home buyers had only a 30 percent share in demand, which is slightly down from 31 percent in October and last year. However, in 2016 home sellers saw an increase of first-time home buyers enter the housing market because of the growing segment of millennials between 25 and 34 years of age. The Census Bureau projects that the population of millennials aged 25 to 34 will increase by an average of nearly 500,000 per year in the second part of the decade. Also, NAR's inaugural quarterly Housing Opportunities and Market Experience survey reported that a large majority of millennials between 25 and 34 years of age who rent want to own a home in the future.

    Interest Rates

    The Federal Reserve raised short-term interests this month. Freddie Mac reported that the average commitment rate for a 30-year, conventional, fixed rate mortgage stayed below 4 percent, but rose from 3.80 percent to 3.94 percent in November. Mortgage rates are expected to rise to 4.50 percent by the end of 2016, but this rate is still historically low; a full percentage point below the rate during the recession of 2008. The low fixed mortgage rate should help spurn demand and encourage first-time home buyers to enter the market. But while the rate is at its current level, potential home buyers should keep an eye out for rate increases so that they're not caught by surprise when the spring buying season comes around. Early 2016 would be a good time for home buyers to start looking to purchase a home.

    Mortgage Lenders & Home Buyers

    Fannie Mae's fourth quarter 2015 Mortgage Lender Sentiment Survey shows that lenders expect to ease mortgage credit standards for GSE-eligible loans and government loans over the next three months. This should reduce the affordability problem for first-time home buyers. As a result, this will help young adult homeownership. Although home prices will be high, all of this is good news for home sellers because they should expect an increase in demand for their home.

    In 2016, the first-time home buyer will have mortgage credit options available that were not available during the housing down-turn. First-time home buyers will have low-and no-down-payment mortgage loans available to them. Some loan options available include FHA loans and the conventional 97 percent program offered by Fannie Mae. Qualifying first-time home buyers need only to put 3 percent down on a home.

    Homeowners

    According to the Mortgage Bankers Association weekly survey, the Refinance Index increased 11 percent compared to the previous week. So it appears homeowners have anticipated the Federal Reserve's increase in interest rates. If you're a homeowner with an adjustable-rate mortgage or a variable home equity line of credit, you should expect your rates to rise in 2016. The first part of 2016 will be a good time to refinance. Home equity lines of credit (HELOC) are both fixed and variable. Variable HELOCs are tied to the Federal Reserve prime rate. Whereas fixed HELOCs are not. By refinancing early in 2016, you'll afford any major life events that may occur such as daughter's wedding, high college tuition, or home renovation.

    Wrap-up

    The National Real Estate Market is on its way to expanding. The Federal Reserve raising interest rates indicates optimism in the housing market and the economy as a whole. The 2016 housing market will remain a sellers market that should see an increase in first-time home buyers entering the market because of the strong desire of homeownership by millennials 25 to 34 years of age, and easing credit standards and increases in wages. Homeowners with variable mortgage rates should expect their rates to rise in 2016, but early 2016 will be a good time to refinance so that you're that you won't fill the brunt of further interest rate increases.

  • Americans Think Homeownership is a Sound Investment

    Media Contact: Jane Dollinger / 202-383-1042 / Email

    WASHINGTON (October 14, 2015) A vast majority of Americans believe that buying a home is a solid financial decision, and most believe they could sell their home for at least its initial purchase price, according to a new survey from the National Association of Realtors. The 2015 National Housing Pulse Survey also found that a preponderance of Americans think that now is a good time to buy a home.

    The survey, which measures consumers' attitudes and concerns about housing issues in the nation's 50 largest metropolitan statistical areas, found that more than eight in 10 Americans believe that purchasing a home is a good financial decision, and 68 percent believe that now is a good time to buy a home. Seventy-one percent believe they could sell their house for what they paid for it, a jump of 16 percentage points from 2013.

    When asked for reasons about why homeownership matters to them, respondents answers did not change significantly from past years. Building equity, wanting a stable and safe environment, and having the freedom to choose their neighborhood remain the top three reasons to own a home.

    "Homeownership is part of the American Dream, and this survey proves that dream is alive and thriving in our communities," said NAR President Chris Polychron, executive broker with 1st Choice Realty in Hot Springs, Ark. "Realtors believe that anyone who is able and willing to assume the responsibilities of owning a home should have the opportunity to pursue that dream in a safe, responsible way, which is why NAR advocates homeownership issues and educating potential buyers about achieving their property investment goals."

    The number of renters who are now thinking about purchasing a home has increased since the last survey in 2013, up from 36 percent to 39 percent. Sixty-one percent of renters stated that owning a home is a priority for their future. According to the survey, 80 percent of respondents believe that pre-purchase counseling programs and classes are very or somewhat important. Forty-five percent of homeowners who said they did not take a counseling program, reported they would have taken part in one had it been easily available to them.

    Attitudes about the housing market have improved in recent years. Forty-nine percent of respondents indicated that they feel activity in the housing market has increased in the past year, compared to 44 percent in 2013 and 12 percent in 2011. Eighty-nine percent expect home sales in their area to either increase or remain the same. Concern about foreclosures has also declined, with only 15 percent of respondents indicating that foreclosure is a major concern.

    In addition to improved attitudes about the housing market, survey participants also showed an improved outlook regarding the economy. Only 36 percent think that job layoffs and unemployment are a big problem, a substantial drop from 45 percent in 2013.

    Perceived obstacles to homeownership have remained mostly unchanged compared to recent years; 78 percent of respondents point to college debt and student loans as the main obstacle to making a home purchase affordable. Seventy-six percent of participants said they have a full-time job but still did not make enough money to purchase a home. Seventy-four percent believe they do not have enough money for a down payment and closing costs.

    As the market has improved, concern about the cost of housing has increased. Two-thirds of survey participants said that home prices are more expensive than they were a year ago. There is additional concern over the lack of available housing; 41 percent said the lack of affordable homes is either a very big or fairly big problem in their area, an increase of 9 percent points from 2013.

    For adult millennials under the age of 35, the burden of student debt is their chief concern, with 86 percent of respondents naming college debt as an obstacle to homeownership. Over half reported that their housing costs are a financial strain on their budget, 65 percent are concerned about high rental prices, and 60 percent are concerned about high home prices. However, millennials tend to have a more upbeat and positive view about the future of the nation than older Americans, with 42 percent of millennials saying that the country is headed in the right direction compared to only 20 percent among those aged 50 and older.

    The 2015 National Housing Pulse Survey is conducted by American Strategies and Myers Research & Strategic Services for NARs Housing Opportunity Program. The telephone survey polled 1,000 adults nationwide in the 50 most populous metropolitan statistical areas. An additional 250 interviews were conducted with millennial adults (born after 1981) from the same geography. The study has a margin of error of plus or minus 3.1 percentage points.

    The National Association of Realtors, "The Voice for Real Estate," is America's largest trade association, representing more than 1.1 million members involved in all aspects of the residential and commercial real estate industries.

    Courtesy National Association of Realtors. Click Here for Original Article.

  • Whether you're putting your home on the market this year or in the next five years, it is a smart decision to start building your home's resale value now. Here are some ways to create a comfortable home while making it easier to put more money into your bank account on closing day.

    Small Maintenance and Repairs

    If you think that home maintenance on the weekends waste your time and energy, think again. The small chores you do around your home prevents it from losing value. Neglecting small maintenance and repairs causes 10% of your home's value to walk out your door and slip through your windows. Most appraisers claim that homes showing little to no preventative maintenance can depreciate from $15,000 to $20,000.

    A study conducted by researchers at the University of Connecticut and Syracuse University shows that regular maintenance boosts your home value by about 1% per year. However, ongoing maintenance costs offset that value, which means that regular maintenance actually slows down your rate of depreciation. Furthermore, because homebuyers generally notice any repairs needed upon buying a new home, proactive maintenance lets the homebuyer know that he or she will not have to spend extra money to maintain the basics. This makes your home more attractive, and thus more likely to get higher priced offers.

    Maintaining the basics can cost you little money and certainly some effort, but theres a way to accomplish this very important activity smartly. This article by HouseLogic, for example, shows you how to keep home maintenance below $300 a year. Planning ahead will also help make maintaining your home easier. Most professional appraisers and real estate agents recommend a proactive maintenance schedule that includes:

    Keeping enough cash on hand to replace systems and materialsCreating and following a maintenance schedulePlanning a room redo every yearKeeping a notebook of all your maintenance and repairs

    Landscaping

    The Virginia Cooperative Extension at Virginia Tech published a study that shows landscaping can increase a home's value by 15%. The study claims that a home valued at $150,000 could increase its value between $8,300 and $19,000 with the addition of landscaping. Particular landscape elements add different value. For instance, landscape design can increase your home's value by 42%, plant size can increase your home's value by 32%, and diversity in plants can increase your home's value by 22%.

    Replace Entrance Doors

    If your entry doors are wood, consider switching them out for either fiberglass or steel doors. Steel doors add style and architectural interest to your home while improving security; you can add a deadbolt and electronic keypads to keep out intruders. Unlike wood doors, steel doors do not rot or splinter.

    Alternatively, fiberglass doors can be designed to look like wood doors and give your home a modern look. Fiberglass doors conserve more energy than steel doors.

    Pricewise, a steel door will cost you $1,335 with a 91% return on investment whereas a fiberglass door will cost you $3,126 with an 82.3% return on investment.

    Garage Door Replacement

    At first, you might not think that your garage door increases the value of your home. However, your garage door distinguishes your home from the other homes on your block. As the largest entryway of a house, garage doors get noticed first because they're the focal point of your home. If you want to quickly increase the resale value of your home, you need to make the most of this space.

    Some interesting things being done with garage doors include:

    Increased Size: Bigger garage doors help homes stand out more, and homeowners can do more creatively with them.Bold Colors: Bright and bold colors now can complement the color of your home, or you can build a concept around the color of your home.Faux Wood: You can install fiberglass or steel garage doors that look like wood garage doors. This gives your home a new level of sophistication.Windows: Large Windows on your garage door improve the aesthetic of your home, and provide light into your garage so that it's no longer a dark space.

    More importantly, a garage door replacement will cost you $1,652 and add $1,512 to the value of your home; that's a return on your investment of 91.5%.

    Fiberglass Attic Insulation

    While energy efficiency is still not the sexiest selling point of your home, installing fiberglass attic insulation saves energy and garners a big payback on your investment. According to Remodeling Magazine's 2016 Cost vs. Value top trends report, fiberglass attic insulation gained the top return on investment among the 30 projects in this year's report. Using Remodel/Max as the cost source, a fiberglass attic insulation project cost $1,268 nationwide. Real estate professionals surveyed estimated that the work would boost the price of a home at resale, within a year of its completion, by $1,482. That's a 116.9% return on investment.

    Replacing Windows

    Replacing your windows is another way to save energy and increase your home's resale value. Replacing your old windows with energy saving models will beautify your home, keep it comfortable, and ease the workload of your HVAC system. According to HGTV, you'll see a reduction in your utility bill by 7% to 15%. However, if you're selling your home, you could expect a 60% to 70% recoupment of your investment. The two types of replacement windows that fetch the best return are vinyl and wood.

    Remodeling Your Kitchen

    Kitchen remodeling can get expensive, but small renovations can make your home more buyer friendly. Changing your kitchen's texture and color using a matte finish and neutral colors such as putty or grey enhances your home's resale value. Because matte finishes have transitional qualities, your potential homebuyer can easily match his or her stainless steel or black and white appliances. Also, refinishing cabinetry, or switching to Energy Star appliances provide comfort you like and pizazz buyers adore.

    Flow is important to any interior design of a home. If you feel that your kitchen hinders a good flow, change it. A small investment to knock out a non-structural wall or remove a kitchen island creates space and provides flow that buyers love.

    A minor kitchen remodel can cost you $20,122 while putting $16,716 of resale value into your home; that's an 83% payback on the project. If you want to do a major kitchen model, this can cost you about $60,000 and put about $39,000 of resale value into your home, which is only about a 65% payback on the project. Therefore, consider a minor kitchen remodel first.

    Bathroom Addition or Remodel

    Likewise, carefully consider adding a bathroom or remodeling your bathroom. Switching out your frosted glass shower doors for glass doors, cleaning the grout, replacing the shower and floor tiles, switching out your sink or toilet, or replacing your sink and shower fixtures can cost you little money.

    Adding a bathroom can get expensive, but it can reduce congestion during hectic times and provide your guests with a bathroom. Consult with your real estate agent or a local appraiser before deciding whether a full remodel or addition is right for your situation. While a bathroom remodel will cost you about $18,000 with a return on investment of about 66%, a bathroom addition will cost you about $42,000 with a return on investment of about 56%. Therefore, it's best do your due diligence before working on your bathroom.

    Your Needs and Buyers' Wants

    On that note, if you need to renovate your home, be sure to consider how those changes will affect its appeal to future buyers. Knowing design trends will give you the opportunity to make changes to your home based onwhereyour needs and your potential buyer's desires intersect, thus increasing your property's resale value drastically.

    Designers and design websites provide great ideas when youre brainstorming home renovations. Keep in mind as you research, however, that you dont want to sacrifice your needs for a comfortable home just for the sake of what you think a future buyer will want!

    Therefore, before you begin making any changes to your home, consult your real estate agent. Real estate agents, because we are constantly working with new buyer clients, have insider insight into what home buyers are looking fornow and in the future. Well be able to help you make smart choices when remodeling or renovating your home.

    If you think you might want to remodel or renovate your home in the near future, or if you are just curious about other ways you can increase its resale value, please reach out to me!

  • No matter if youre in a buyers or sellers market, there are a few critical steps you can take to make a smarter purchase. Since buying a home is likely the biggest single investment you will ever make, being prepared will help you make a better purchase. Here are our best tips to buying a home.

    Know your buying power

    What is your buying power? It is the combination of your credit-worthiness and how much you can realistically pay for a home.

    First, you need to understand the hidden costs of buying a home. You will need to save not only for the down payment of your home -- which is typically between 10% - 20% of the offer price -- but also for any additional transaction fees, such as transfer tax, PMI, title insurance, and legal fees.

    Then you need to know what you can realistically afford each month to understand how much house you can buy. Your mortgage rate will depend on your creditworthiness -- if you have a high credit score, your lender will likely approve you for a lower mortgage rate, which can save you thousands of dollars per year in interest.

    How much of your budget should go to your monthly home costs? According to SmartAssets, you can use the 36% rule as a rough guideline. This means that your monthly obligation shouldnt be more than 36% of your monthly gross income.

    A loan professional can help you figure out how much house you can afford.

    Fix your credit with the help of a loan professional

    According to CreditKarma, a good credit score is usually 720 or above. You want to clean up your credit as soon as you can, and definitely before you go to a lender for a loan preapproval.

    When you apply for your loan pre-approval, you dont want to have anything to hide on your application. So dont lower your credit score by doing anything that will originate more inquiries into your credit. For example, dont open any new credit cards. Also, dont omit any debts or loans when you apply. If the loan officer discovers them in the application process, they may deny you a pre-approval.

    Get a loan professional to check your credit score for you. A professional can give you a clearer idea if your score is in the good range, or if you need to do some credit cleanup before getting a mortgage preapproval.

    Work with a knowledgeable buyers agent

    Do you understand what kind of market you are buying into? Even within a citys limits, there can be micro markets that are increasing or decreasing in value.

    Thats why its important to hire a highly competent real estate agent who knows the specific market. You want to make sure that the professional who youre working with really understands what the market is like and will help you find the home that you desire.

    How can you tell if your agent knows the market? See if they can provide you with a buyers market analysis.

    A buyers market analysis report outlines which neighborhoods are still up and coming -- with potential for increased property value -- versus those that have peaked with inflated home prices. Having this analysis at your fingertips will help you know if a homes list price is above comparable properties so you dont overpay for a home.

    Dont try to time the market...

    Even in a hot market, theres never a perfect time to buy a home. It can take a while to know exactly what you like, and you may have to look at 10 or more homes before you can recognize what suits your lifestyle best. While youre shopping, take photos of your favorite properties and the details that you liked the best so that you can remember what you liked.

    Another good reason to slow down the buying process: you might find a better deal if you do. Investigate expired listings. Expired listings may have gone off the market because they didnt get any offers at the listed price, so you may be able to underbid the original listing price. Its not likely worth your time to look at FSBO (for sale by owner) listings, though. Since they are not represented by a professional, they are often overpriced.

    When you start shopping, have a one-hour initial consultation with your realtor. Give them every single detail that you know about your lifestyle, buying power, needs, wants and desires for your home. The more detail you can provide, the easier it will be for them to help you find your future home. Your agent may also know of exclusive listings not available to the general public.

    But make the offer as soon as you find the right home

    If you love it, make the offer. Otherwise, that dream home may disappear faster than you think, especially if youre buying in a hot market.

    Your buying agent should contact the listing agent before you submit an offer so that they can decide whats important to include in the offer. If youre serious about it, you want to increase the chances that your offer is accepted.

    Show that youre serious about the purchase by creating a buyers offer packet. It should include your lenders preapproval letter, a screenshot of your down payment money in your bank account, and comps that support the rationalization of the offer you are presenting.

    Get a home inspection

    Once youre in the negotiation process, its essential that you get a third-party inspector to run a thorough home inspection. The inspector will be looking for major structural issues, including problems with the foundation, plumbing, and electrical systems. Your inspector should be extra picky, pointing out the most minor faults.

    Make sure to have the inspection conducted before it is too late to back out of a deal. If there are any major structural issues, you may be able to make the seller repair them as a contingency to solidifying your offer. Minor issues that you can repair on your own may be points for negotiating a lower offer.

    Protect your credit before you close

    Dont raise any red flags with your creditworthiness in the weeks before closing. Any one of these moves could mean that youre denied the loan and the deal falls through -- even if youve already been preapproved!

    Keep your spending to a minimum and dont make any major purchases before closing -- that includes buying furniture, or a car, truck, or van, or any excessive charges on your credit card.Keep your bank accounts stable. Dont change banks, spend any of the money you have set aside for closing, or make any large deposits to your accounts without checking with your loan officer first.Keep your employment situation stable -- do not change jobs, quit your job, or become self-employed. Any sudden change in your income can have that preapproval offer rescinded.Do not cosign a loan for anyone. It will open an inquiry into your credit and add to your debt, which could raise your mortgage rate and cost you thousands of dollars over the life of the loan.

    Looking for a home in our area? Let us help you find the home of your dreams. Were well versed in the our local real estate market, and we can provide you with a buyers market analysis to help you find the right neighborhood for you. Contact one of our trusted agents today.

  • You can't avoid paying taxes, and we all need to pay our fair share. However, paying your fair share shouldn't place an unjust burden on you. As a homeowner, your tax burden is doubled because you pay both income and property taxes. To decrease that burden and boost your tax savings, take advantage of these homeowner tax deductions. As a result, you can use your tax savings to go on a vacation, increase your child's college fund, build upon your retirement fund, or complete another home improvement project.

    Home Improvement Tax Deduction

    You spend so much of your time at home, and you try to make it as comfortable a place to live as possible. If your home needs some upgrades, consider improvements that will help foot the bill for themselves.

    You can get an energy-efficient tax credit of up to $500 for installing storm doors and energy-efficient insulation and air-conditioning and heating systems. Switching out your old windows for energy-efficient ones could earn you $200. This credit expires this year on December 31st. So, this year will be your last chance to take advantage of getting tax credit for making your home more energy efficient.

    Also, installing equipment that uses renewable sources of energy makes you eligible for the Renewable Energy Efficiency Property Credit. The credit covers 30 percent of the cost of equipment and installation. This credit also expires this year on December 31st.

    Mortgage Interest and Refinancing

    If your mortgage payment makes you cringe each month, youll be glad to know you can deduct taxes on the following:

    * Interest towards mortgage

    * Mortgage payments for additional property

    * Rental properties

    * Refinancing and home equity lines of credit (HELOC) up to $100,000 of debt.

    If you own multiple properties, the mortgage interest on additional property is deductible as well. The cool thing is that it doesn't have to be a house. It can be a boat or RV; as long as it has cooking, sleeping, and bathroom facilities, it counts as additional property.

    Regarding using your second home as a rental, you need to vacation at least 14 days at the property or spend more than 10 percent of the number of days you rent it out.

    Furthermore, you can claim points on your mortgage the year you paid them if the following happened:

    * The loan was to purchase or build your main home

    * Payment of points is an established business practice in your area and the points were within the usual range

    Property Taxes

    Now, this is the big one. Property taxes you pay each year are tax deductible. The amount of property taxes you paid for the year shows up on your lender's annual statement. You must deduct them as an itemized expense on your Schedule A tax form.

    First-time homebuyers, look at your settlement sheet to see additional tax payment data. You may deduct the portion of property taxes you paid during the first year of your homeownership.

    Protesting Your Assessment to Lower Your Property Taxes

    Although you must pay property taxes, you can make sure that you pay a reasonable amount based on the true value of your home and land. Many homes get overvalued because assessors err in valuing a home and homeowners don't pay attention to these mistakes. Consequently, homeowners unwittingly pay more than they should in property taxes.

    However, if youve owned your home for more than a year, you can potentially lower your property tax burden by showing that your home has been overvalued, meaning that your tax assessment claims your property is worth more than it is.

    Even if the number on the tax assessment seems close, you should still consider protesting your property tax. Typical savings from a successful tax protest is over 15%!

    According to SmartAsset, the national median property tax paid is roughly $2,839.00. That's about 1.192 percent of a home valued at $238,200.00.

    If you're able to reduce your assessed value by 15 percent to $202,470.00 and consequently save 15 percent on your tax bill, your new tax bill will be about 2,413.00. Thats a savings of $426.00!

    To get started protesting your property tax, read your assessment letter. Your assessment letter will list data about your property and the assessed value of your house and land. Make sure your assessment letter has the correct information about your property.

    Understanding that assessors can make mistakes assessing your home value will help you with your appeal. There are three key mistakes assessor make when assessing property. These mistakes include:

    Mass Appraisal Methods: Also, when assessors use mass appraisal methods, they do not take into account all the market adjustments that occurred over time. Consequently, there sales data can't always produce useful comparable properties to set future sales.Outdated Historic Sales Data: Sometimes assessors will use sales data from previous years. Because the real estate market is fluid, this data changes quickly, as a result; this data can over value your home.Living Area: Assessors notoriously make mistakes about the living area of your house. This is especially true if you live in a 1.5 or 2 story home. Check any previous appraisals to ensure correct measurements and description of our home. Does the assessment letter show the right number of bathrooms and bedrooms? Does it report the correct size of your lot? .5 acres differs greatly than 5.0 acres.

    After reading your assessment letter, consult a Realtor. We can find three to five approximate values of comparable properties similar to yours, and these comps can then be used to support your claim that your home is overvalued. This is especially useful if the assessor used poor historical sales data.

    You'll have 30 days to file an appeal of your assessment, so youll want to get the comps as soon as your assessment arrives. You can speak with an assessor on the phone or request a formal review.

    You'll then need to fill out a form and follow specific instructions regarding your supporting evidence. Typically, it's not necessary for you to appear at the review. The review can take one to three months to complete, and you'll receive a decision in writing. The majority of assessment appeals are successful. However, if at first you don't succeed, appeal. You'll need to pay a small filing fee for an independent appeals board to hear your second appeal. This process could take up to a year to complete, so you'll need to decide whether it's truly worth it.

    As a homeowner, you have plenty of options available to decrease your tax burden. The benefit is that you can use your tax savings for major life events such as weddings, vacations, and home improvements.

    To find out more about your tax saving options as a homeowner, check out tax information for homeowners. You can also contact me directly and I'll gladly lead you in the right direction towards saving you money on your taxes.

  • A Beginners Guide to Real Estate Investing

    Despite the grim economic outlook for some industries, one sector is gaining viability -- real estate. According to the 2016 Emerging Trends in Real Estate, which was released by the Urban Land Institute earlier this year, trends such as 18-hour cities and millennial parents increasing moving from urban areas out into the suburbs signal that real estate as an industry is gaining strength every passing day in 2016. One lending officer at a large financial institution even went to far as to say that the next 24 months look doggone good for real estate.

    These trends means that real estate is a smart place to make an investment and grow your wealth. A housing shortage means that flipped homes tend to sell quickly and for high prices, and an increased demand across all age groups for rental properties means that finding tenants for your buy-and-hold properties should be a breeze.

    Of course, these trends also mean that the real estate market is highly competitive right now. If you want to make a foray into real estate investing, youll need to educate yourself and be strategic in who you work with and where you look for investment opportunities. Read on for our beginners guide to real estate investing.

    Assemble your real estate team before you buy

    Building relationships with your team will empower you to make serious offers that will more likely get accepted by sellers. Among your team members, you will want to include:

    A mortgage broker or banker, who can help you get the financing for your deal A real estate attorney to protect you by reviewing and revising contracts An appraiser who can help you get a correct appraisal for your potential property An accountant who is well versed in real estate investments A good contractor, for repairs whether youre rehabbing or buying rental property

    How to find rehab or wholesale deals

    You can buy properties to fix up and resell (flip) or you can buy and hold properties that you rent out for monthly cash flow.

    The advantage of flipping properties is that you can end up with a good return on investment (ROI) in the short term. For example, you buy a property for $100,000, and invest $50,000 into repairs. Once its rehabbed, your property is valued at $200,000, and you sell it for a $50,000 profit.

    This is an extremely simplified version of ROI. There are many other factors that you need to determine to see if the numbers work in your favor that is, youre not overpaying initially when you buy the properties or for the renovations or holding costs.

    Flipping properties means that you will need to spend more time looking for fixer uppers that may be under market value. These may be more difficult to find in a hot market with rising property prices. Beyond the actual purchase price, you will also need to factor in fixed purchase costs for inspections, closing, and lender fees.

    Youll also need to factor in holding costs. Your budget should include funds for making repairs, whether you are doing them yourself or hiring contractors. While youre upgrading the property, youll need to carry mortgage payments, property taxes, utilities, and insurance.

    Because of rising property values, fix-and-flip deals in good neighborhoods can be hard to find. But once you know where to find rehab opportunities, you can easily repeat the process by reinvesting proceeds from a previous flip into the next property, which can be bigger, in a more desirable neighborhood, or finished out more luxuriously, and therefore sold for more cash!

    Working with the right real estate professionals will help you learn which neighborhoods to consider and determine where you should focus your search. We can help you find the right fixer-uppers that may be under market value. Also, a Realtor will have access to many properties that may not be publicly available.

    Finding buy-and-hold rental properties

    A buy-and-hold rental property is one that your purchase with the intent of renting it out to tenants. If you find the right long-term buy-and-hold rental property, you can earn consistent cash flow each month, which can be a great source of supplemental income.

    Youll need to carefully review the operating expenses on the property and what tenants are willing to pay for the space to know if youll make or lose money each month. For example, say your total costs to buy a duplex was $20,000, including down payment and closing costs. You can rent each of the units for $600. Assuming your building is 100% occupied, youll make $1200 per month in income. Your expenses include mortgage payments, taxes, insurance, utilities, and management fees, and you want to set aside some cash each month for capital expenditures and routine repairs. You calculate that your expenses add up to $1100 per month. Once you subtract your expenses from your income, youll have a positive cash flow of $100 per month.

    Of course, this is a very simplified example, and it doesnt take into account that problems will inevitably arise. Emergency roof repairs, heating system breakdowns, broken windows that need replacing, and other unexpected expenses can eat away at your profits. One of your units may be vacant for a month or more -- for example, vacancies are high in the summer months in buildings around universities -- or you could have a tenant who fails to pay their monthly rent.

    The more you can anticipate problems before they happen, however, the easier it will be for you to recover from setbacks! Moreover, rent isnt the only way to make money on a buy-and-hold property. You can also add amenities, such as coin laundry and vending machines, to increase your potential monthly income. If your property has space to add a billboard, you can earn advertising revenue from renting that space, too. And when you decide to sell, your propertys value will likely have increased both from the overall rising property values and by the improvements you made to increase the cash flow.

    Once you find and invest in your rental property, youll need to decide how you want it managed from month to month.

    Getting the right property manager

    Do you want to manage your own property or hire a manager? Property management can become a full-time job. As a property manager, youll have to deal not only with maintenance, repairs and tenant issues, but also with insurance, fair rental regulations, and building code compliance. So if youre not an expert in these areas, managing your own properties may not be worth your time and effort.

    Hiring a professional manager can save you headaches over the long term. While youll have to factor in management as a fixed expense, your property manager will likely know how to better take care of routine repairs, tenant issues, and keeping your property near 100% occupancy.

    Your real estate professional can refer you to reputable property management companies to help you take care of your investment.

    Where should I start investing in local real estate?

    Work with a knowledgeable real estate professional who knows about the different neighborhoods. We can help you find properties that will fit into your budget and your overall goals. Whether youre seeking a duplex or multifamily property so you can maximize your rental income or whether you want a condo or single-family home to improve for resale, we can guide you to the best property to suit your needs.

    Contact your us to learn more about investment properties in our area.

  • Should You Buy a New or Existing Home?

    Maybe your dream home has the intricate details that you usually find only in older

    construction - wainscoting and crown molding in the interior, the front porch with a

    swing, an older tree shading the back yard, and the white picket fence.

    Or maybe your dream home has all the conveniences of modern living - open floor plan

    in the living and dining spaces, large windows, connected, smart appliances and

    security systems, and minimalist design elements.

    Whether you go for a brand new construction or an existing home, both types of

    properties have their pros and cons when it comes to purchasing. What type of home is

    right for you will depend on which factors are most important for your lifestyle.

    Build your dream home with new construction

    If youre making a home purchase thats still in the pre-construction phase, you may be

    able to customize many of the details. Many home builders will give you the option to

    add design elements that will give you the exact dream home you desire. If its a new

    subdivision, you may even be able to pick which lot you like best.

    Very early in the building process, you may have more room to customize. For example,

    if the walls arent complete, you may be able to add extra outlets in each of the rooms or

    custom wiring for surround sound in the media room. Perhaps you could move the

    laundry room to the top floor instead of the basement. You might be able to get a

    separate mudroom entrance.

    Later in the building process, you may be able to add marble countertops, an island,

    and custom cabinets in the kitchen. Your master bathroom could be upgraded with a

    steam shower, spa tub, and European fixtures. You will want to check with the builder to

    understand which features are included, and which ones are extra.

    New homes save money with fewer repairs and more efficiency

    Once your home is complete, all youll need to do is move in. New appliances will be

    under warranty for a few years if they need repairs, and will likely work well for several

    years without needing fixes. Often, new construction is under a builders warranty, so

    any repairs needed in the first year should be covered.

    New homes often contain energy efficient and green appliances, like high-efficiency

    stoves, refrigerators, washing machines, heaters, or air conditioning units. These

    energy-saving appliances, along with good insulation and energy-efficient windows, will

    help you save money on monthly utility bills.

    New homes also often use new building materials that require less maintenance for

    example, using composite siding instead of wood, which doesnt need annual

    repainting. You wont need to spend as much to maintain your new home.

    If you customized it during pre-construction, you wont need to spend any money on

    renovations or upgrades for several more years. You can just enjoy it and not worry

    about saving for major home repairs.

    What you need to do to make a good new home purchase

    Before you put in your offer, do some research on the builder. Do they have a good

    reputation? What else have they built? Did their other new properties have issues such

    as poor construction or unfinished details?

    You like the model home, but will you like where its situated? After you look at the

    home itself, come back to the neighborhood to see what its like at different times of the

    day. Walk around during the day and in the evening, and see how you like the area.

    Brand new communities usually attract similar types of buyersurban professionals,

    couples, or young families, for example. These will be your neighbors, so youll want to

    make sure that you want to be part of this new, homogeneous community.

    You may also need to be flexible with your move-in date. Builders will only be able to let

    you move in if they can meet their construction schedule. If the wiring is delayed, the

    walls cant be finished. And because there are so many construction tasks that are

    dependent on the completion of prior tasks, schedules tend to slip.

    Get more variety and established neighborhoods with an existing home

    Existing homes are those that have generally been built and lived in between the 1920s

    and 1970s. With existing homes, you will get more variety in home styles, as different

    types of construction have gone in and out of style throughout the decades. Within one

    neighborhood, you may be able to find a mix of different styles like Victorian, modern

    Tudor cottages, tract style, ranch or split-ranch, or contemporary homes.

    Existing homes are situated in established neighborhoods, which may have more

    amenities nearby that a new home in a brand new subdivision may not have. Your new

    neighborhood may have restaurants, cafes, and boutiques within walking distance.

    You might also have access to more supermarkets, dry cleaners, discount stores, and

    gas stations nearby. An established neighborhood might have a nice park, running path,

    or playground for the kids to enjoy. You might also be closer to a library or the post

    Resale homes can be a less expensive purchase

    If youre considering a resale home, you may be able to get into a beautiful, unique

    property at a lower purchase price than a new home.

    There are many more resale homes available than there are new homes according

    to the National Association of Homebuilders, about 10 times as many. With such a large

    pool to buy from, the market for resales can be more competitive. You may have more

    room to negotiate the selling price of the home. With a brand-new construction, you

    wont likely be able to have the same kind of negotiating power.

    Before putting a home on the market, sellers often make home renovations or remodel

    parts of their homes to make them more attractive to buyers and to be able to potentially

    increase the list price. If the resale home has a brand new, modern kitchen, an updated

    bathroom, or even a new roof or upgraded windows, you could end up getting a home

    thats comparable to new construction without having to pay the potential more

    expensive new-home list price.

    Existing homes have already been inspected at least once on the last sale, so you will

    know about any potential structural problems or repairs that have been made on the

    home. Knowing the track record on your potential home will help you avoid purchase

    mistakesyoure much less likely to end up with a property that has a rotting roof,

    dangerous electrical wiring, or a crumbling foundation. With a new home, you could end

    up with incomplete construction or major issues that you didnt know about because

    they werent yet documented.

    What you need to do to make a good resale purchase

    Before you go too far down the road to a purchase, you can protect your purchase by

    first having the home inspected. A good home inspector will document all flaws, no

    matter how small they appear. If the inspector finds any major problems, like foundation

    cracks or leaky roofs, you may be able to counter offer and get the seller to either fix it

    or reduce the selling price.

    Even if the inspection doesnt uncover any major issues, you will need to expect the

    unexpected. Older homes will eventually need replacement appliances, a new air

    conditioning unit, or a plumbing repair. As long as you know that before you buy a

    resale home, you can plan for surprise repairs.

    With an older home, you may want to eventually remodel parts of it. Will you be happy

    living in your house while youre doing major work on the living room or the kitchen? If

    you know that it would disrupt your lifestyle too much, you may want to consider

    whether you really want to buy an older property.

    Whether you choose to buy a new home or an existing home, the best way to get

    started is to speak with your trusted real estate professional. We will have access to

    both new properties and resale homes that may fit your goals, and will know which

    neighborhoods will serve your needs.