Despite the continuing challenges facing the U.S., nearly eight out of 10 respondents believe buying a home is a good financial decision, according to NAR's eighth annual Housing Opportunity Pulse Survey.
The survey, which measures how affordable housing issues affect consumers, also found job security concerns to be the highest in eight years of sampling, with 70 percent of Americans saying that job layoffs and unemployment are a big problem in their area; eight in 10 cite these issues as a barrier to homeownership. The telephone survey of 1,209 urban and suburban adults in the top 25 metropolitan statistical areas was conducted for NAR by American Strategies and Myers Research & Strategic Services for NAR's Housing Opportunity Program.
Some key results:
* Americans continue to believe that buying a home is a good financial decision (77 percent believe strongly or not so strongly, 68 percent strongly so).
* More than two-thirds of respondents (68 percent) say that now is a good time to buy a home.
* Job insecurity and the lack of jobs continue to be the primary obstacle to home ownership and market recovery.
* Respondents see the recession and job losses as the main reasons for the foreclosure problem, a shift from last year when they were more likely to blame homeowners who bought homes they could not afford.
* A majority of renters say that owning a home at some point in the future is either one of their highest priorities (39 percent) or a moderate priority (24 percent). Just 21 percent of renters say that owning a home is not a priority at all.
* Frustration with banks is up: now a majority worry that banks have made it too hard to qualify for a home mortgage loan.
* 51 percent of respondents say foreclosures remain a big or moderate problem in their area. While there has been a significant drop in the percentage of those surveyed who say foreclosures have increased, 51 percent say that the rate of foreclosures is about the same as it was last year.
* Most of those surveyed say that it is harder to sell a home in their neighborhood than it was a year ago.
* Looking forward, 70 percent expect real estate sales in their neighborhood to remain about the same over the next few months. A nearly identical number (69 percent), also expect home values to remain the same.
* Nearly one-quarter (23 percent) are now very concerned about the number of homes and condos for sale in their area—a number that is up 7 points from last year.
* Most respondents are more concerned about the drop in home values than they are about home costs being too high. Still, cost remains the significant barrier to many who would otherwise like to buy a home.
Saturday, October 30, 2010
Friday, October 29, 2010
13 Tips for a Safe Halloween
Halloween is a wonderful time to dress up, let loose and, of course, eat lots of candy.
However, there are a number of things to be cautious about when it comes to costumes, candy and parties. Here are the “lucky 13” guidelines from FDA, Consumer Product Safety Commission and the Centers for Disease Control and Prevention:
1. Wear costumes made of fire-retardant materials; look for “flame resistant” on the label. If you make your costume, use flame-resistant fabrics such as polyester or nylon.
2. Wear bright, reflective costumes or add strips of reflective tape so you’ll be more visible; make sure the costumes aren’t so long that you’re in danger of tripping.
3. Wear makeup and hats rather than masks that can obscure your vision.
4. Test the makeup you plan to use by putting a small amount on your arm a couple of days in advance. If you get a rash, redness, swelling, or other signs of irritation where you applied it, that’s a sign you may be allergic to it.
5. Check FDA’s list of color additives to see if additives in your makeup are FDA approved. If they aren’t approved for their intended use, don’t use it.
6. Don’t wear decorative contact lenses unless you have seen an eye care professional and gotten a proper lens fitting and instructions for using the lenses.
Safe Treats
Eating sweet treats is also a big part of the fun on Halloween. If you’re trick-or-treating, health and safety experts say you should remember these tips:
7. Don’t eat candy until it has been inspected at home.
8. Trick-or-treaters should eat a snack before heading out, so they won’t be tempted to nibble on treats that haven’t been inspected.
9. Tell children not to accept—or eat—anything that isn’t commercially wrapped.
10. Parents of very young children should remove any choking hazards such as gum, peanuts, hard candies, or small toys.
11. Inspect commercially wrapped treats for signs of tampering, such as an unusual appearance or discoloration, tiny pinholes, or tears in wrappers. Throw away anything that looks suspicious.
For partygoers and party throwers, FDA recommends the following tips for two seasonal favorites:
12. Look for the warning label to avoid juice that hasn’t been pasteurized or otherwise processed, especially packaged juice products that may have been made on site. When in doubt, ask! Always ask if you are unsure if a juice product is pasteurized or not. Normally, the juice found in your grocer’s frozen food case, refrigerated section, or on the shelf in boxes, bottles, or cans is pasteurized.
13. Before bobbing for apples—a favorite Halloween game—reduce the amount of bacteria that might be on apples by thoroughly rinsing them under cool running water. As an added precaution, use a produce brush to remove surface dirt.
However, there are a number of things to be cautious about when it comes to costumes, candy and parties. Here are the “lucky 13” guidelines from FDA, Consumer Product Safety Commission and the Centers for Disease Control and Prevention:
1. Wear costumes made of fire-retardant materials; look for “flame resistant” on the label. If you make your costume, use flame-resistant fabrics such as polyester or nylon.
2. Wear bright, reflective costumes or add strips of reflective tape so you’ll be more visible; make sure the costumes aren’t so long that you’re in danger of tripping.
3. Wear makeup and hats rather than masks that can obscure your vision.
4. Test the makeup you plan to use by putting a small amount on your arm a couple of days in advance. If you get a rash, redness, swelling, or other signs of irritation where you applied it, that’s a sign you may be allergic to it.
5. Check FDA’s list of color additives to see if additives in your makeup are FDA approved. If they aren’t approved for their intended use, don’t use it.
6. Don’t wear decorative contact lenses unless you have seen an eye care professional and gotten a proper lens fitting and instructions for using the lenses.
Safe Treats
Eating sweet treats is also a big part of the fun on Halloween. If you’re trick-or-treating, health and safety experts say you should remember these tips:
7. Don’t eat candy until it has been inspected at home.
8. Trick-or-treaters should eat a snack before heading out, so they won’t be tempted to nibble on treats that haven’t been inspected.
9. Tell children not to accept—or eat—anything that isn’t commercially wrapped.
10. Parents of very young children should remove any choking hazards such as gum, peanuts, hard candies, or small toys.
11. Inspect commercially wrapped treats for signs of tampering, such as an unusual appearance or discoloration, tiny pinholes, or tears in wrappers. Throw away anything that looks suspicious.
For partygoers and party throwers, FDA recommends the following tips for two seasonal favorites:
12. Look for the warning label to avoid juice that hasn’t been pasteurized or otherwise processed, especially packaged juice products that may have been made on site. When in doubt, ask! Always ask if you are unsure if a juice product is pasteurized or not. Normally, the juice found in your grocer’s frozen food case, refrigerated section, or on the shelf in boxes, bottles, or cans is pasteurized.
13. Before bobbing for apples—a favorite Halloween game—reduce the amount of bacteria that might be on apples by thoroughly rinsing them under cool running water. As an added precaution, use a produce brush to remove surface dirt.
Thursday, October 28, 2010
5 Traits of Today's Home Buyers
A survey by American Lives, a consumer research firm in California, conducted a study for the trade magazine Builder to answer that question. Here are their conclusions:
· They are young. Most are under 45. Half said they had annual household incomes of $75,000 or less. Two-thirds are married.
· They are frugal. They consistently told surveyors they were eager to live a simple lifestyle.
· They are concerned about their financial future. About 70 percent said the economy is “not so good” with 27 percent saying it was getting worse and 27 percent saying it was getting better, and two-thirds saying it would get better in a year. Some 55 percent said they were concerned that they might lose their jobs.
· They see themselves as energy efficient but not necessarily “green.” About 32 percent said they’d pay extra for energy-efficient features but only 16 percent said they’d pay extra for recycled or renewable construction materials.
· Neighborhood is important. Ninety-five percent said they thought the community was as important as the home itself. Seventy-nine percent wanted the most square footage they could afford, but 69 percent said they’d consider a smaller home in the right neighborhood.
Source: Inman News, Mary Umberger (10/27/2010)
· They are young. Most are under 45. Half said they had annual household incomes of $75,000 or less. Two-thirds are married.
· They are frugal. They consistently told surveyors they were eager to live a simple lifestyle.
· They are concerned about their financial future. About 70 percent said the economy is “not so good” with 27 percent saying it was getting worse and 27 percent saying it was getting better, and two-thirds saying it would get better in a year. Some 55 percent said they were concerned that they might lose their jobs.
· They see themselves as energy efficient but not necessarily “green.” About 32 percent said they’d pay extra for energy-efficient features but only 16 percent said they’d pay extra for recycled or renewable construction materials.
· Neighborhood is important. Ninety-five percent said they thought the community was as important as the home itself. Seventy-nine percent wanted the most square footage they could afford, but 69 percent said they’d consider a smaller home in the right neighborhood.
Source: Inman News, Mary Umberger (10/27/2010)
Wednesday, October 27, 2010
Simple Tips to Take the Stress Out of the Home-Buying Process - Focus on the Positives
For many prospective buyers, the thought of going through the home-buying process is often filled with a lot of stress. From finding a qualified real estate agent, to narrowing down your choice of homes and then packing your belongings and moving across town can be an overwhelming process.
Here are some tips to help you keep your cool as you begin the process of a buying a home.
-Buying a home is one of the biggest financial decisions you will make in your lifetime, and along with the finances come emotions. When you are choosing a real estate agent to work with, be patient and take the time you need to find an agent that you connect with. Finding a highly-skilled agent who fits with your personality is crucial.
-Every home buyer and seller is in a different situation, so it is important that you don’t compare your timeline and decisions to anyone else’s. As you make your way through the home buying process, remember that there is no right time to buy, just as there is no perfect time to sell. If you find a home that fits your needs, don’t let it slip out of your hands by waiting for interest rates to drop lower as you run the chance of losing out on the home of your dreams.
-It is natural to want to get opinions from those you trust before you make your final choice, but too much input will ultimately make the decision process much harder. Remember to focus on what your immediate wants and needs are so that everyone will be happy with the final decision.
-You probably aren’t going to find a home that is 100% perfect, so it is important to make a list that includes your top priorities that you can’t live without. Be sure to stick to the items on your list and let go of the minor things.
-Negotiation is an important part of the real estate buying process, but be sure you don’t take your negotiating too far. Trying to get an extra-low price or refusing to budge on your offer may cost you the home in the end. Successful negotiation depends on give and take, so make sure you are being fair in your requests.
-Don’t get too caught up in all the physical aspects of a home and forget about the more important issues. While the size of the rooms and the layout of the kitchen might not be exactly what you expected, be cognizant of issues such as noise level, location to amenities and other aspects that will have an impact on your day-to-day life.
-Getting approved for a mortgage should be taken care of well before you find a home and make an offer.
-Create a budget before you move into your new home and be sure to include maintenance and repair costs. Even if you buy a new home, there will be extra costs, so it is important to not come up short and let your new home deteriorate.
-After purchasing a home, a little buyer’s remorse is inevitable, but it will pass. Buying a home is a big financial commitment, but it also yields big benefits. If you are feeling remorseful after buying your home, remind yourself why you wanted to buy a home and what made you fall in love with your new property.
-When choosing a home, buy it because you love it. A home’s most important role is to serve as a comfortable, safe place to live, so don’t get bogged down with thinking about your home’s appreciation.
Here are some tips to help you keep your cool as you begin the process of a buying a home.
-Buying a home is one of the biggest financial decisions you will make in your lifetime, and along with the finances come emotions. When you are choosing a real estate agent to work with, be patient and take the time you need to find an agent that you connect with. Finding a highly-skilled agent who fits with your personality is crucial.
-Every home buyer and seller is in a different situation, so it is important that you don’t compare your timeline and decisions to anyone else’s. As you make your way through the home buying process, remember that there is no right time to buy, just as there is no perfect time to sell. If you find a home that fits your needs, don’t let it slip out of your hands by waiting for interest rates to drop lower as you run the chance of losing out on the home of your dreams.
-It is natural to want to get opinions from those you trust before you make your final choice, but too much input will ultimately make the decision process much harder. Remember to focus on what your immediate wants and needs are so that everyone will be happy with the final decision.
-You probably aren’t going to find a home that is 100% perfect, so it is important to make a list that includes your top priorities that you can’t live without. Be sure to stick to the items on your list and let go of the minor things.
-Negotiation is an important part of the real estate buying process, but be sure you don’t take your negotiating too far. Trying to get an extra-low price or refusing to budge on your offer may cost you the home in the end. Successful negotiation depends on give and take, so make sure you are being fair in your requests.
-Don’t get too caught up in all the physical aspects of a home and forget about the more important issues. While the size of the rooms and the layout of the kitchen might not be exactly what you expected, be cognizant of issues such as noise level, location to amenities and other aspects that will have an impact on your day-to-day life.
-Getting approved for a mortgage should be taken care of well before you find a home and make an offer.
-Create a budget before you move into your new home and be sure to include maintenance and repair costs. Even if you buy a new home, there will be extra costs, so it is important to not come up short and let your new home deteriorate.
-After purchasing a home, a little buyer’s remorse is inevitable, but it will pass. Buying a home is a big financial commitment, but it also yields big benefits. If you are feeling remorseful after buying your home, remind yourself why you wanted to buy a home and what made you fall in love with your new property.
-When choosing a home, buy it because you love it. A home’s most important role is to serve as a comfortable, safe place to live, so don’t get bogged down with thinking about your home’s appreciation.
Tuesday, October 26, 2010
Get Credit Score in Order Before Applying for Credit
If your mailbox is starting to fill up again with credit card offers and you're tempted to apply, be realistic about your chances of qualifying.
Increased credit card solicitations are an indication that things have gotten much better for card issuers, with declines in defaults and delinquencies, said Bill Hardekopf, CEO of LowCards.com and author of "The Credit Card Guidebook."
"They are once again aggressively pursuing new customers, but this time around, they seem to really be focusing on those with good or excellent credit scores," he said.
Consumers may have to jump through more hoops than before to get a credit card today. But it's not impossible to get a card.
Before you apply for a credit card, get a copy of your credit report and your FICO credit score, the dominant score used by lenders, which uses a score range of 300 to 850.
Use your credit score as a guide to what kind of credit card you should apply for.
If your score is lower than you expected, check your credit report for errors and correct them before you apply for credit. If your score is too low, be prepared to pay.
"If your FICO score is 750 or above, you should apply for the cards specifically offered for excellent credit," Hardekopf said. "A score of 720 or above is considered good credit; 660 to 720 is acceptable."
If your score is below 650, you could find yourself in the subprime category, and you could have a tough time getting approved, he said.
"Anything below a 650 FICO score seems to be the dividing line between prime and subprime," agreed John Ulzheimer, president of consumer education at Credit.com.
The scary thing is that as of April, 35.2 percent of consumers had FICO scores below 650, according to the company that produces the influential number.
"Scores below 650 are there for a reason," Ulzheimer said. "It's negative information, such as late payments, foreclosures, bankruptcy, tax liens, hitting your credit report and excessive credit card debt."
According to Hardekopf, "consumers should not waste their time and apply for a card for which they are not qualified. If you apply for too many credit cards at once, this is a red flag and may actually cause your score to drop."
Some credit card issuers will give you some guidance as to what your credit level is.
For example, Capital One considers you to have excellent credit if you've had a loan or credit card for at least five years, have a credit limit of more than $10,000, have never been more than 60 days late on a credit card, medical bill or loan payment and have never declared bankruptcy.
You have average credit in Capital One's eyes if you have a credit card limit of less than $5,000 or you may have been late on more than one credit card, medical bill or loan payment in the past six months.
How you pay your credit card bill also should determine what kind of card you apply for.
If you pay off your card each month, you should look for a card with a good rewards program, Hardekopf said.
But if you carry a balance each month, you want a card with the lowest annual percentage rate and then work your tail off to pay off the card as quickly as possible.
"You really need to decide before you apply for a card what kind of credit card customer you are," Hardekopf said.
(c) 2010, The Dallas Morning News.
Increased credit card solicitations are an indication that things have gotten much better for card issuers, with declines in defaults and delinquencies, said Bill Hardekopf, CEO of LowCards.com and author of "The Credit Card Guidebook."
"They are once again aggressively pursuing new customers, but this time around, they seem to really be focusing on those with good or excellent credit scores," he said.
Consumers may have to jump through more hoops than before to get a credit card today. But it's not impossible to get a card.
Before you apply for a credit card, get a copy of your credit report and your FICO credit score, the dominant score used by lenders, which uses a score range of 300 to 850.
Use your credit score as a guide to what kind of credit card you should apply for.
If your score is lower than you expected, check your credit report for errors and correct them before you apply for credit. If your score is too low, be prepared to pay.
"If your FICO score is 750 or above, you should apply for the cards specifically offered for excellent credit," Hardekopf said. "A score of 720 or above is considered good credit; 660 to 720 is acceptable."
If your score is below 650, you could find yourself in the subprime category, and you could have a tough time getting approved, he said.
"Anything below a 650 FICO score seems to be the dividing line between prime and subprime," agreed John Ulzheimer, president of consumer education at Credit.com.
The scary thing is that as of April, 35.2 percent of consumers had FICO scores below 650, according to the company that produces the influential number.
"Scores below 650 are there for a reason," Ulzheimer said. "It's negative information, such as late payments, foreclosures, bankruptcy, tax liens, hitting your credit report and excessive credit card debt."
According to Hardekopf, "consumers should not waste their time and apply for a card for which they are not qualified. If you apply for too many credit cards at once, this is a red flag and may actually cause your score to drop."
Some credit card issuers will give you some guidance as to what your credit level is.
For example, Capital One considers you to have excellent credit if you've had a loan or credit card for at least five years, have a credit limit of more than $10,000, have never been more than 60 days late on a credit card, medical bill or loan payment and have never declared bankruptcy.
You have average credit in Capital One's eyes if you have a credit card limit of less than $5,000 or you may have been late on more than one credit card, medical bill or loan payment in the past six months.
How you pay your credit card bill also should determine what kind of card you apply for.
If you pay off your card each month, you should look for a card with a good rewards program, Hardekopf said.
But if you carry a balance each month, you want a card with the lowest annual percentage rate and then work your tail off to pay off the card as quickly as possible.
"You really need to decide before you apply for a card what kind of credit card customer you are," Hardekopf said.
(c) 2010, The Dallas Morning News.
Sunday, October 24, 2010
What You Should Know Before Buying a Home
There are so many things to understand as you embark on purchasing a home, especially if it's your first purchase. Learn the basics as you get started and understand everything you need to know as it relates to financing.
Here are 10 tips about financing:
1. Before you start looking for a home, get pre-qualified for a loan. Banks, credit unions and mortgage bankers make home loans; mortgage brokers process them. The lenders will take an application, process the loan documents, and see the loan through to the funding stage.
2. If you have marginal or bad credit, consult your lender. You may be able to qualify for a loan depending on how long ago and what reason(s) caused the bad credit. A lender should be able to advise you on whether your credit history will prevent you from qualifying for a home loan.
3. You will need a down payment. Down payment requirements vary depending on the type of loan. Many down payment assistance programs exist. These programs may loan or grant you the funds necessary for the down payment. Consult with a lender about programs available in your area.
4. You will need funds for closing costs. Closing costs are charges for services related to the closing of your real estate transaction. They include, but are not limited to:
* Escrow fees charged by the company handling the transaction
* Title policy issuance fees charged by the title insurance company
* Mortgage insurance fees
* Fire and homeowners insurance
* County Recorder fees for recording your deed
* Loan origination fees
Consult your lender for an actual estimate of these costs, as well as information about loan programs which can assist in financing your closing costs
5. Some loans have "points" and some do not. A point is a loan origination fee equivalent to 1% of the loan amount. Together with the interest rate they constitute the yield on your loan for the lender. Some lenders charge a higher interest rate to compensate for charging no points. It is important to comparison shop lenders to make sure your loan is at a competitive yield.
6. Should you select a mortgage with a fixed rate or an adjustable rate? The answer to this question depends on whether mortgage rates are at a high or a low point when you purchase, and on how long you plan to live in the home. If rates are high, an adjustable rate might be attractive since subsequent rate drops could reduce your monthly payments. Additionally, lenders may offer a low rate during the first few years of an adjustable mortgage to make it appealing to you. If interest rates are low you might want to take a fixed rate to protect yourself against the possibility of rising interest rates.
7. Be aware of the two main types of loan categories.
* Conventional Loans. Conventional mortgage loans are available with fixed or adjustable interest rates. Some loans may require mortgage insurance.
* Government Loans. These include Federal Housing Administration (FHA) fixed and adjustable rate mortgage loans, and Veterans Administration (VA) fixed rate mortgage loan
8. If you are a low or moderate income home buyer, there are special programs designed to help you. These loans are available through private lenders, as well as local and state housing agencies, like the California Housing Finance Agency (CalHFA). Most lenders specializing in real estate mortgage loans are aware of these types of loan programs.
9. Why might I have to pay mortgage insurance? Mortgage insurance protects the lender from potential loss if you should default on your mortgage loan payment. Generally, conventional loans that require larger down payments do not require mortgage insurance. Mortgage insurance is always required on FHA mortgage loans.
10. Many organizations offer home loan counseling to prospective home buyers. These organizations provide classes for homebuyers to cover the steps to homeownership. They will cover home selection, realtor services, lenders, loan programs, homeownership responsibilities, saving for a down payment, and other important pieces of information. Many first-time home buyer programs require homebuyers to attend this type of class to be eligible for selected programs.
Here are 10 tips about financing:
1. Before you start looking for a home, get pre-qualified for a loan. Banks, credit unions and mortgage bankers make home loans; mortgage brokers process them. The lenders will take an application, process the loan documents, and see the loan through to the funding stage.
2. If you have marginal or bad credit, consult your lender. You may be able to qualify for a loan depending on how long ago and what reason(s) caused the bad credit. A lender should be able to advise you on whether your credit history will prevent you from qualifying for a home loan.
3. You will need a down payment. Down payment requirements vary depending on the type of loan. Many down payment assistance programs exist. These programs may loan or grant you the funds necessary for the down payment. Consult with a lender about programs available in your area.
4. You will need funds for closing costs. Closing costs are charges for services related to the closing of your real estate transaction. They include, but are not limited to:
* Escrow fees charged by the company handling the transaction
* Title policy issuance fees charged by the title insurance company
* Mortgage insurance fees
* Fire and homeowners insurance
* County Recorder fees for recording your deed
* Loan origination fees
Consult your lender for an actual estimate of these costs, as well as information about loan programs which can assist in financing your closing costs
5. Some loans have "points" and some do not. A point is a loan origination fee equivalent to 1% of the loan amount. Together with the interest rate they constitute the yield on your loan for the lender. Some lenders charge a higher interest rate to compensate for charging no points. It is important to comparison shop lenders to make sure your loan is at a competitive yield.
6. Should you select a mortgage with a fixed rate or an adjustable rate? The answer to this question depends on whether mortgage rates are at a high or a low point when you purchase, and on how long you plan to live in the home. If rates are high, an adjustable rate might be attractive since subsequent rate drops could reduce your monthly payments. Additionally, lenders may offer a low rate during the first few years of an adjustable mortgage to make it appealing to you. If interest rates are low you might want to take a fixed rate to protect yourself against the possibility of rising interest rates.
7. Be aware of the two main types of loan categories.
* Conventional Loans. Conventional mortgage loans are available with fixed or adjustable interest rates. Some loans may require mortgage insurance.
* Government Loans. These include Federal Housing Administration (FHA) fixed and adjustable rate mortgage loans, and Veterans Administration (VA) fixed rate mortgage loan
8. If you are a low or moderate income home buyer, there are special programs designed to help you. These loans are available through private lenders, as well as local and state housing agencies, like the California Housing Finance Agency (CalHFA). Most lenders specializing in real estate mortgage loans are aware of these types of loan programs.
9. Why might I have to pay mortgage insurance? Mortgage insurance protects the lender from potential loss if you should default on your mortgage loan payment. Generally, conventional loans that require larger down payments do not require mortgage insurance. Mortgage insurance is always required on FHA mortgage loans.
10. Many organizations offer home loan counseling to prospective home buyers. These organizations provide classes for homebuyers to cover the steps to homeownership. They will cover home selection, realtor services, lenders, loan programs, homeownership responsibilities, saving for a down payment, and other important pieces of information. Many first-time home buyer programs require homebuyers to attend this type of class to be eligible for selected programs.
Saturday, October 23, 2010
Survey: Economy Driving People Out of the Housing Market
Nearly two-thirds of Americans say the current economic situation is making them less likely to buy a house, according to a new national survey by FindLaw.com (http://www.findlaw.com), a popular legal information website.
Sixty-three percent of American adults say they are less likely to buy a house because of the current state of the economy. Despite record-low mortgage rates and an abundance of houses available on the market, only 8 percent of people say the current economic situation makes them more likely to buy a house. About a quarter of people – 28 percent – say they are neither more likely nor less likely to buy a house because of the economy.
In particular, the current economy is driving lower-income individuals and families out of the market. People with annual incomes less than $50,000 were significantly more likely to say they are less inclined to buy a house than people with higher incomes.
"The current economic situation has greatly changed the dynamics of the housing market," said Stephanie Rahlfs, an attorney and editor with FindLaw.com. "Although mortgage rates are near record lows, stricter lending requirements are often making it more difficult for many people to obtain mortgages. High unemployment rates are raising concerns about housing appreciation, affordability and foreclosures. Together, these factors are causing many people to shy away from the idea of buying a house. Buying a home, selling a home and owning a home are all becoming more complicated, and it's important to know the ins and outs of contracts, finances and your rights as a buyer, seller or owner."
Free Internet resources such as the FindLaw Real Estate center (http://realestate.findlaw.com/) can provide helpful information on buying, selling and owning a home, including obtaining a loan, borrowers' rights, finding the best mortgage, homeowners' rights, avoiding foreclosure and more. It also has useful information for renters, including negotiating a lease, tenants' rights, and fair housing and discrimination laws.
The FindLaw.com survey was conducted using a demographically balanced telephone survey of 1,000 American adults and has a margin of error of plus-or-minus 3 percent.
Sixty-three percent of American adults say they are less likely to buy a house because of the current state of the economy. Despite record-low mortgage rates and an abundance of houses available on the market, only 8 percent of people say the current economic situation makes them more likely to buy a house. About a quarter of people – 28 percent – say they are neither more likely nor less likely to buy a house because of the economy.
In particular, the current economy is driving lower-income individuals and families out of the market. People with annual incomes less than $50,000 were significantly more likely to say they are less inclined to buy a house than people with higher incomes.
"The current economic situation has greatly changed the dynamics of the housing market," said Stephanie Rahlfs, an attorney and editor with FindLaw.com. "Although mortgage rates are near record lows, stricter lending requirements are often making it more difficult for many people to obtain mortgages. High unemployment rates are raising concerns about housing appreciation, affordability and foreclosures. Together, these factors are causing many people to shy away from the idea of buying a house. Buying a home, selling a home and owning a home are all becoming more complicated, and it's important to know the ins and outs of contracts, finances and your rights as a buyer, seller or owner."
Free Internet resources such as the FindLaw Real Estate center (http://realestate.findlaw.com/) can provide helpful information on buying, selling and owning a home, including obtaining a loan, borrowers' rights, finding the best mortgage, homeowners' rights, avoiding foreclosure and more. It also has useful information for renters, including negotiating a lease, tenants' rights, and fair housing and discrimination laws.
The FindLaw.com survey was conducted using a demographically balanced telephone survey of 1,000 American adults and has a margin of error of plus-or-minus 3 percent.
Friday, October 22, 2010
Fannie Mae Announces New Incentives for HomePath Properties
Fannie Mae announced a seller assistance incentive on Fannie Mae-owned properties listed on the company’s REO website, www.HomePath.com, and expands the initiative to offer an incentive to real estate agents and brokers. Qualified homebuyers who will be owner-occupants can receive up to 3.5 percent of the final sales price that can be used toward closing cost assistance, including a home warranty, if desired and available. In addition, selling agents representing owner-occupants will receive a $1,500 bonus. Eligible offers must be submitted on or after September 23, 2010, and must close by December 31, 2010. The sale must close within 60 days of the offer being accepted.
“More than eighty-seven thousand families have purchased HomePath® properties in the first half of 2010—nearly double the number of Fannie Mae foreclosed properties sold in the first half of 2009,” said Terry Edwards, Executive Vice President of Fannie Mae’s Credit Portfolio Management. “We continue to look for ways to stabilize neighborhoods and offer incentives to qualified buyers who will occupy these properties over the long-term and help support their communities."
HomePath properties are owned by Fannie Mae and include a wide selection of homes, including single-family homes, condominiums, and town houses. HomePath properties may also be eligible for special HomePath Mortgage and HomePath Renovation Mortgage financing.
“More than eighty-seven thousand families have purchased HomePath® properties in the first half of 2010—nearly double the number of Fannie Mae foreclosed properties sold in the first half of 2009,” said Terry Edwards, Executive Vice President of Fannie Mae’s Credit Portfolio Management. “We continue to look for ways to stabilize neighborhoods and offer incentives to qualified buyers who will occupy these properties over the long-term and help support their communities."
HomePath properties are owned by Fannie Mae and include a wide selection of homes, including single-family homes, condominiums, and town houses. HomePath properties may also be eligible for special HomePath Mortgage and HomePath Renovation Mortgage financing.
Thursday, October 21, 2010
Fewer Homes Pushed into Foreclosure
Big banks pushed fewer U.S. households into foreclosure for the seventh consecutive month in August, a real estate firm reported, though repossessions of properties already ensnared in the process hit a record.
The continued convergence of the two trends — fewer notices of default filed on homes but more properties sold at courthouse steps — indicates that major lenders are meting out foreclosures in a systematic way so as not to flood the housing market with a wave of steeply discounted properties, RealtyTrac said.
RealtyTrac Chief Executive James J. Saccacio called the trends "a clear indication that the clogged foreclosure pipeline is being carefully managed on both ends by lenders and servicers."
A total of 94,469 properties received default notices in August, a 1 percent decrease from July and a 30 percent decrease from August 2009. On the other end of the process, lenders seized 95,364 properties in August, the highest monthly total in the history of RealtyTrac's report, an increase of 3 percent from July and a 25 percent jump from August 2009.
Lenders are working through a backlog of properties that developed last year after many foreclosures were frozen by moratoriums and slowed by trial mortgage modification attempts.
(c) 2010, Los Angeles Times.
The continued convergence of the two trends — fewer notices of default filed on homes but more properties sold at courthouse steps — indicates that major lenders are meting out foreclosures in a systematic way so as not to flood the housing market with a wave of steeply discounted properties, RealtyTrac said.
RealtyTrac Chief Executive James J. Saccacio called the trends "a clear indication that the clogged foreclosure pipeline is being carefully managed on both ends by lenders and servicers."
A total of 94,469 properties received default notices in August, a 1 percent decrease from July and a 30 percent decrease from August 2009. On the other end of the process, lenders seized 95,364 properties in August, the highest monthly total in the history of RealtyTrac's report, an increase of 3 percent from July and a 25 percent jump from August 2009.
Lenders are working through a backlog of properties that developed last year after many foreclosures were frozen by moratoriums and slowed by trial mortgage modification attempts.
(c) 2010, Los Angeles Times.
Wednesday, October 20, 2010
100 Dollars Can Go a Long Way for a Great Looking Yard
Got a hundred bucks and a free weekend? Then you've got what it takes to invest in some yard care improvements.
"Some of the best upgrades to your yard can be done with a few dollars and a few hours," says Trey Rogers, Ph.D., the Briggs & Stratton Yard Doctor. "When budgets are tight, get creative and do it yourself."
What can you do for $100 right now?
-- Mow the right way. Don't scalp your lawn. Instead, let it grow a little longer, which is healthy for the lawn. When you mow, cut only one-third the length of the grass blade. Cost: About $3.00 for a month of mowing.
-- Apply bark mulch. Few things dress up a yard more than mulch around flowerbeds and trees. Cost: About $3.00 per bag.
-- Fertilize naturally. When you mow, leave a light layer of grass clippings on the lawn as a natural fertilizer. Cost: $0.
-- Maintain your mower. Once a year, change the oil, replace the spark plug and change the filter. Tune-up kits are available and make it\ easy. Cost: $10-14 for a walk-behind mower.
-- Let nature water your lawn. If water is costly where you live, let nature handle irrigation. If too little rain falls, your lawn may go dormant, but unless you are in a drought situation, it will green up
again when the rain falls. Cost: $0.
With the rest of your $100 bill, splurge on some annual flowers to dress up your front doorway, patio or deck.
"Some of the best upgrades to your yard can be done with a few dollars and a few hours," says Trey Rogers, Ph.D., the Briggs & Stratton Yard Doctor. "When budgets are tight, get creative and do it yourself."
What can you do for $100 right now?
-- Mow the right way. Don't scalp your lawn. Instead, let it grow a little longer, which is healthy for the lawn. When you mow, cut only one-third the length of the grass blade. Cost: About $3.00 for a month of mowing.
-- Apply bark mulch. Few things dress up a yard more than mulch around flowerbeds and trees. Cost: About $3.00 per bag.
-- Fertilize naturally. When you mow, leave a light layer of grass clippings on the lawn as a natural fertilizer. Cost: $0.
-- Maintain your mower. Once a year, change the oil, replace the spark plug and change the filter. Tune-up kits are available and make it\ easy. Cost: $10-14 for a walk-behind mower.
-- Let nature water your lawn. If water is costly where you live, let nature handle irrigation. If too little rain falls, your lawn may go dormant, but unless you are in a drought situation, it will green up
again when the rain falls. Cost: $0.
With the rest of your $100 bill, splurge on some annual flowers to dress up your front doorway, patio or deck.
Monday, October 18, 2010
6 Reasons it Pays to Shop Around Before Choosing a Mortgage
You wouldn’t buy a house without shopping around first, right? Then why would you commit to the loan you use to buy that house without making sure you’re getting the best deal possible? From the experts at LendingTree, here are six reasons why it’s essential to take a few minutes to browse before you borrow:
1. To get the best interest rate possible
Over the life of a $200,000, 30-year fixed rate loan, a one-tenth of a point difference in interest rate could save or cost you thousands of dollars.
2. To pay lower loan fees
Once your loan application is accepted, the lender will get back to you with a good-faith estimate (GFE), including an itemized list of all the costs associated with the loan. If there are any parts of the GFE that you don’t understand, don’t be afraid to ask the lender to explain each fee that is listed.
3. To avoid a prepayment penalty
In these transient times, it seems no one stays in their home long enough to pay down their mortgage the old fashioned way: in monthly increments over a period of decades. So you’ll want to be clear on whether the terms of your loan include a penalty if you pay off your mortgage early—either because you move or refinance.
4. To find a lender you feel comfortable with
You don’t want any surprises popping up at closing time. Get a lender who is responsive to your questions and is willing to give you the details in writing.
5. To find a lender that specializes in your situation
Recent volatility in the mortgage markets means that people with bad credit or little money for a down payment might have to look a little harder to find a lender.
6. To get the rate lock period you want
Once you’ve found the lender offering the best mortgage rate and terms, you’ll want to get a written commitment, known as a “lock” that puts in writing that the lender will make the loan to you at that the specified interest rate. The length of the lock can vary from 30-90 days, but many lenders will charge a fee for a rate commitment of longer than a month. Negotiate the lock period that is right for you, depending on when you plan to close on your new home and if interest rates are expected to creep higher during that time.
1. To get the best interest rate possible
Over the life of a $200,000, 30-year fixed rate loan, a one-tenth of a point difference in interest rate could save or cost you thousands of dollars.
2. To pay lower loan fees
Once your loan application is accepted, the lender will get back to you with a good-faith estimate (GFE), including an itemized list of all the costs associated with the loan. If there are any parts of the GFE that you don’t understand, don’t be afraid to ask the lender to explain each fee that is listed.
3. To avoid a prepayment penalty
In these transient times, it seems no one stays in their home long enough to pay down their mortgage the old fashioned way: in monthly increments over a period of decades. So you’ll want to be clear on whether the terms of your loan include a penalty if you pay off your mortgage early—either because you move or refinance.
4. To find a lender you feel comfortable with
You don’t want any surprises popping up at closing time. Get a lender who is responsive to your questions and is willing to give you the details in writing.
5. To find a lender that specializes in your situation
Recent volatility in the mortgage markets means that people with bad credit or little money for a down payment might have to look a little harder to find a lender.
6. To get the rate lock period you want
Once you’ve found the lender offering the best mortgage rate and terms, you’ll want to get a written commitment, known as a “lock” that puts in writing that the lender will make the loan to you at that the specified interest rate. The length of the lock can vary from 30-90 days, but many lenders will charge a fee for a rate commitment of longer than a month. Negotiate the lock period that is right for you, depending on when you plan to close on your new home and if interest rates are expected to creep higher during that time.
Sunday, October 17, 2010
Vacant Homes Pose Insurance Risks
As the U.S. housing market struggles to rebound, many homeowners are stuck with hard-to-sell properties longer than expected. Some frustrated home sellers who must relocate for a new job opportunity, want to downsize or simply want to buy a new place have left homes empty. Vacant or unoccupied homes can leave the homeowner exposed to loss and liability that may not be covered by their insurance, according to the National Association of Insurance Commissioners (NAIC).
The Pending Home Sales Index, released today by the National Association of Realtors, dropped 2.6 percent to 75.7 based on contracts signed in June from 77.7 in May, and is 18.6 percent below June 2009 - another sign of the stagnant housing market.
"In many cases, people who have been trying to sell their homes for awhile have moved forward with their plans regardless, leaving a vacant home on the market," said NAIC President and West Virginia Insurance Commissioner Jane L. Cline. "Having an unoccupied home can create several insurance implications that typically are not covered under a standard homeowners policy."
The Added Risks of Vacant Homes
Homeowners policies are meant to insure homes that are occupied, so they generally include exclusions for neglect or property abandonment on a home left vacant or unoccupied for a specified number of consecutive days.
In insurance terms, a vacant home is one the resident has moved out of and taken his/her belongings with him/her. An unoccupied home is one where the resident is not staying at the home, but the furniture and other belongings remain.
Because vacant and unoccupied homes pose a higher risk for damage than occupied homes, insurance companies insure these properties differently and usually at a higher price. These risks include:
-- Break-ins: When a home has been unoccupied for awhile, it can show signs that nobody is around - unkempt lawn, full mailbox, no lights on - that can tip off burglars to an easy target.
-- No emergency response: Without anyone home to call 911 or respond to emergencies, a manageable problem - such as a small electrical fire - can turn into a much larger, more costly disaster.
-- Property liability: There is no one present to prevent others from entering the property or to supervise activity, which could increase the likeliness of an accident on the premises or property damage when the owner is not there.
Keeping A Vacant Home Properly Insured
The definition of vacancy and unoccupancy can vary from policy to policy. Some insurers may not pay claims if a home is vacant for 60 days or more. Some policies might automatically shift to a different amount of coverage (e.g. liability insurance only) after a specific number of days unoccupied.
Many homeowners policies have a "vacancy clause" that can be triggered if the homeowner is gone for an extended period of time. If this happens, the homeowner could violate the terms of their contract and some or all of their coverage may not apply in the event of a loss.
"Before you decide to leave a home vacant or unoccupied for a long period of time, talk to your insurance agent or company to learn how they define vacancy and unoccupancy, and whether the company will pay claims if a house is unoccupied," said Cline. "Be honest about your situation, because while an extra policy might cost more, it could save you money down the road should there be an accident or damage to the home."
Many insurance companies offer an endorsement that will provide coverage for a dwelling that is unoccupied for an extended period of time. Vacancy policies can also be purchased for different term lengths to cover a few months to a year, depending on the need.
The cost of vacancy coverage depends on the company and state in which the property is located, but costs usually are higher than a typical homeowners policy due to the overall increase in risk.
The Pending Home Sales Index, released today by the National Association of Realtors, dropped 2.6 percent to 75.7 based on contracts signed in June from 77.7 in May, and is 18.6 percent below June 2009 - another sign of the stagnant housing market.
"In many cases, people who have been trying to sell their homes for awhile have moved forward with their plans regardless, leaving a vacant home on the market," said NAIC President and West Virginia Insurance Commissioner Jane L. Cline. "Having an unoccupied home can create several insurance implications that typically are not covered under a standard homeowners policy."
The Added Risks of Vacant Homes
Homeowners policies are meant to insure homes that are occupied, so they generally include exclusions for neglect or property abandonment on a home left vacant or unoccupied for a specified number of consecutive days.
In insurance terms, a vacant home is one the resident has moved out of and taken his/her belongings with him/her. An unoccupied home is one where the resident is not staying at the home, but the furniture and other belongings remain.
Because vacant and unoccupied homes pose a higher risk for damage than occupied homes, insurance companies insure these properties differently and usually at a higher price. These risks include:
-- Break-ins: When a home has been unoccupied for awhile, it can show signs that nobody is around - unkempt lawn, full mailbox, no lights on - that can tip off burglars to an easy target.
-- No emergency response: Without anyone home to call 911 or respond to emergencies, a manageable problem - such as a small electrical fire - can turn into a much larger, more costly disaster.
-- Property liability: There is no one present to prevent others from entering the property or to supervise activity, which could increase the likeliness of an accident on the premises or property damage when the owner is not there.
Keeping A Vacant Home Properly Insured
The definition of vacancy and unoccupancy can vary from policy to policy. Some insurers may not pay claims if a home is vacant for 60 days or more. Some policies might automatically shift to a different amount of coverage (e.g. liability insurance only) after a specific number of days unoccupied.
Many homeowners policies have a "vacancy clause" that can be triggered if the homeowner is gone for an extended period of time. If this happens, the homeowner could violate the terms of their contract and some or all of their coverage may not apply in the event of a loss.
"Before you decide to leave a home vacant or unoccupied for a long period of time, talk to your insurance agent or company to learn how they define vacancy and unoccupancy, and whether the company will pay claims if a house is unoccupied," said Cline. "Be honest about your situation, because while an extra policy might cost more, it could save you money down the road should there be an accident or damage to the home."
Many insurance companies offer an endorsement that will provide coverage for a dwelling that is unoccupied for an extended period of time. Vacancy policies can also be purchased for different term lengths to cover a few months to a year, depending on the need.
The cost of vacancy coverage depends on the company and state in which the property is located, but costs usually are higher than a typical homeowners policy due to the overall increase in risk.
Saturday, October 16, 2010
School Performance Can Increase Home Values, Buyer Interest
Because proximity to a quality school is such a high priority for some families as they search for their next home, buyers and sellers in cities with top ranked schools or school districts can often expect to see higher median list prices as compared to the statewide median list price, sometimes as much as 10 to 28 percent higher.
"Without a doubt the 'right' school district increases value by 12 to 14 percent in my area even in today's market," said Maria Picardi-Kenyon, a longtime Realtor located in New Jersey. "I've spoken with many clients who are convinced that a preferred school district provides as much as 20 percent or more value to a home."
To help families as they search for academic excellence and affordable housing during this year's back to school season, Move, Inc., a leader in online real estate, today releases median list prices in ten communities ranked with high education quality scores, along with tips on how to expedite this season's real estate search before the school bell rings.
In an April 2010 review of 17,377 cities and towns in 49 states, Ohio, Pennsylvania, Indiana and Kentucky led the review with the highest ranking school districts in terms of educational quality scores and median list prices under $200,000. The review took into consideration K-12 public school enrollment data, student test scores, and population data that determined average education quality scores, among other data.
Data from the same April 2010 review also indicated the highest ranking school districts in terms of educational quality scores with median list prices between $200,000 and $345,270 today can be found in Vermont, Wisconsin, Indiana, and Minnesota.
Factors Associated With Selecting Housing Near Quality Schools
While the National Education Association's study on student achievement reports the proximity of affordable housing in stable neighborhoods remains a key component to a student's success, buyers also often consider location to jobs, shopping, freeways, and property taxes among other things when searching areas with high ranked school districts.
"Clients focused on a particular school district are often inclined to favor neighborhoods that have great accessibility to community facilities like parks, pools, tennis courts, running/biking trails, as well as access to retail and restaurants," said Tom Thornton, an EcoBroker with Realty Austin of Austin, Texas. "In Austin, popular neighborhoods with good schools can have an average negotiation range of two to three percent from list price, while the resale advantage can be as much as a five or 10 percent premium compared to neighborhoods without popular amenities."
Is Bigger Better?
The ability to live, earn and learn often comes with a price in communities that serve larger student populations. According to The United States Department of Education, three states - California, Florida and Texas - account for 45 of the nation's largest public school districts with an average of 169 school choices per district.
Median list prices for single-family homes listed for sale on the Move Network in California, Florida and Texas in July 2010 were $335,000, $215,000, and $179,900 respectively, while the national media price was $212,900 during the same time period.
Average active list prices for single-family homes listed for sale on the Move Network in the nation's top three largest school districts in July 2010 were $816,545 in New York, $879,743 in Los Angeles, and $425,869 in Chicago.
Community Information, School Data and More Available online 24/7
Regardless of the time of year, consumers searching for a property on the Move Network can easily find local community information at the bottom of each listing detail page including school name, distance from the home of interest, type of school, grades taught, Great Schools Rating, parent rating; and the location of the home on a map that can be viewed in road, aerial or bird's eyes views.
Additional information on these listing detail pages includes: cost of living; climate; distinctive community characteristics such as the closest airport, colleges, closest major sports team, and general community information such as population statistics; household information including number, size and family make up of recorded households; general housing information such as pricing, dwelling age and annual residential turnover; available transportation types; income, net worth and employment by industry and occupation.
"Without a doubt the 'right' school district increases value by 12 to 14 percent in my area even in today's market," said Maria Picardi-Kenyon, a longtime Realtor located in New Jersey. "I've spoken with many clients who are convinced that a preferred school district provides as much as 20 percent or more value to a home."
To help families as they search for academic excellence and affordable housing during this year's back to school season, Move, Inc., a leader in online real estate, today releases median list prices in ten communities ranked with high education quality scores, along with tips on how to expedite this season's real estate search before the school bell rings.
In an April 2010 review of 17,377 cities and towns in 49 states, Ohio, Pennsylvania, Indiana and Kentucky led the review with the highest ranking school districts in terms of educational quality scores and median list prices under $200,000. The review took into consideration K-12 public school enrollment data, student test scores, and population data that determined average education quality scores, among other data.
Data from the same April 2010 review also indicated the highest ranking school districts in terms of educational quality scores with median list prices between $200,000 and $345,270 today can be found in Vermont, Wisconsin, Indiana, and Minnesota.
Factors Associated With Selecting Housing Near Quality Schools
While the National Education Association's study on student achievement reports the proximity of affordable housing in stable neighborhoods remains a key component to a student's success, buyers also often consider location to jobs, shopping, freeways, and property taxes among other things when searching areas with high ranked school districts.
"Clients focused on a particular school district are often inclined to favor neighborhoods that have great accessibility to community facilities like parks, pools, tennis courts, running/biking trails, as well as access to retail and restaurants," said Tom Thornton, an EcoBroker with Realty Austin of Austin, Texas. "In Austin, popular neighborhoods with good schools can have an average negotiation range of two to three percent from list price, while the resale advantage can be as much as a five or 10 percent premium compared to neighborhoods without popular amenities."
Is Bigger Better?
The ability to live, earn and learn often comes with a price in communities that serve larger student populations. According to The United States Department of Education, three states - California, Florida and Texas - account for 45 of the nation's largest public school districts with an average of 169 school choices per district.
Median list prices for single-family homes listed for sale on the Move Network in California, Florida and Texas in July 2010 were $335,000, $215,000, and $179,900 respectively, while the national media price was $212,900 during the same time period.
Average active list prices for single-family homes listed for sale on the Move Network in the nation's top three largest school districts in July 2010 were $816,545 in New York, $879,743 in Los Angeles, and $425,869 in Chicago.
Community Information, School Data and More Available online 24/7
Regardless of the time of year, consumers searching for a property on the Move Network can easily find local community information at the bottom of each listing detail page including school name, distance from the home of interest, type of school, grades taught, Great Schools Rating, parent rating; and the location of the home on a map that can be viewed in road, aerial or bird's eyes views.
Additional information on these listing detail pages includes: cost of living; climate; distinctive community characteristics such as the closest airport, colleges, closest major sports team, and general community information such as population statistics; household information including number, size and family make up of recorded households; general housing information such as pricing, dwelling age and annual residential turnover; available transportation types; income, net worth and employment by industry and occupation.
Friday, October 15, 2010
Appraisals Continue to Be Low and Sink Some Deals
With foreclosures a large share of property sales in some areas, appraisers continue to factor in the sale price of foreclosed properties when setting values of regular properties. Appraisers are aware the practice isn't ideal, but in some markets they're left with little choice because of the large number of foreclosed properties.
Bill Geiger Jr., an appraiser in Cocoa Beach, Fla., told a local magazine that when he has to use a distressed property while doing an appraisal, he contacts the real estate practitioners involved in the sale and reviews computerized listings for the property to find out as much as he can about the condition of the home when it sold. He adjusts the appraisal value accordingly.
There are other factors at work in holding down valuations. Rob Johnson, vice president of lending at San Diego Funding, says lenders demand greater scrutiny of a property if the buyer has a credit score on the low end or a high debt level relative to income. That extra scrutiny can impact whether the lender decides whether to make a loan at the originally appraised value
A third factor is the fluctuation of the market, with some sellers reluctant to let go of their previous expectations.
Industry professionals had hoped that repeal of unpopular appraisal standards would help address concerns with low valuations, but repeal by itself doesn't change the conditions appraisers face. The repeal of the standards, called the home valuation code of conduct, was enacted into law as part of the big Wall Street reform bill passed a few months ago.
Source: UPI, Steve Cook (09/28/2010)
Bill Geiger Jr., an appraiser in Cocoa Beach, Fla., told a local magazine that when he has to use a distressed property while doing an appraisal, he contacts the real estate practitioners involved in the sale and reviews computerized listings for the property to find out as much as he can about the condition of the home when it sold. He adjusts the appraisal value accordingly.
There are other factors at work in holding down valuations. Rob Johnson, vice president of lending at San Diego Funding, says lenders demand greater scrutiny of a property if the buyer has a credit score on the low end or a high debt level relative to income. That extra scrutiny can impact whether the lender decides whether to make a loan at the originally appraised value
A third factor is the fluctuation of the market, with some sellers reluctant to let go of their previous expectations.
Industry professionals had hoped that repeal of unpopular appraisal standards would help address concerns with low valuations, but repeal by itself doesn't change the conditions appraisers face. The repeal of the standards, called the home valuation code of conduct, was enacted into law as part of the big Wall Street reform bill passed a few months ago.
Source: UPI, Steve Cook (09/28/2010)
Thursday, October 14, 2010
10 Low-Cost Tips to Improve Your Home's Appeal
When selling your home, the goal is to sell it quickly for the highest price while investing as little as possible in renovations. With a limited budget and a little effort, you can greatly increase your home's appeal by focusing on what prospective buyers can see on their first visit. The experts at BuyOwner.com offer the following recommendations for preparing a house for sale and staging it for showings.
Tip #1: Refresh the exterior
First impressions count when it comes to selling a home. Most buyers won’t even leave their car if they don’t find the exterior appealing. The best ways to improve your home’s exterior include:
-Repairing and/or replacing trims, shutters, gutters, shingles, mailboxes, window screens, walkways and the driveway.
-Painting siding, trim and shutters and lamp and mailbox posts.
-Pressure washing vinyl siding, roofs, walkways and the driveway.
-Washing windows.
Tip #2: Spruce up the lawn and landscape
Home buyers associate the condition of your lawn and landscaping with the condition of your home’s interior. By improving the outside, you affect buyers’ impression of the entire property. The best ways to enhance the yard include:
-Mowing and edging the lawn.
-Seeding, fertilizing and weeding the lawn.
-Keeping up with regular lawn maintenance by frequent watering.
-Trimming and/or removing overgrown trees, shrubs and hedges.
-Weeding and mulching plant beds.
-Planting colorful seasonal flowers in existing plant beds.
-Removing trash, especially along fences and underneath hedges.
-Sweeping and weeding the street curb along your property.
Tip #3: Create an inviting entrance
The front door to your home should invite buyers to enter. The best ways to improve your entry include:
-Painting the front door in a glossy, cheerful color that complements the exterior.
-Cleaning, polishing and/or replacing the door knocker, locks and handles.
-Repairing and/or replacing the screen door, the doorbell, porch lights and house numbers.
-Placing a new welcome mat and a group of seasonal potted plants and flowers by the entry.
Tip #4: Reduce clutter and furniture
A buyer cannot envision living in your home without seeing it. A home filled with clutter or even too much furniture distracts buyers from seeing how they can utilize the space your home offers. If you have limited storage space, you may want to consider renting a temporary storage unit to place items you wish to keep. The best ways to declutter your home include:
-Holding a garage sale to prepare for your move, getting rid of unnecessary items.
-Removing clutter such as books, magazines, toys, tools, supplies and unused items from counter tops, open shelves, storage closets, the garage and basements.
-Storing out-of-season clothing and shoes out of sight to make bedroom closets seem roomier.
-Removing any visibly damaged furniture.
-Organizing bookshelves, closets, cabinets and pantries. Buyers will inspect everything.
-Putting away your personal photographs, unless they showcase the home. Let buyers see themselves in your home.
-De-personalize rooms as much as you can.
Tip #5: Clean, clean, clean
The cleanliness of your home also influences a buyer's perception of its condition. The appearance of the kitchen and bathrooms will play a considerable role in a buyer's decision process, so pay particular attention to these areas. The best ways to improve these areas include:
-Cleaning windows, fixtures, hardware, ceiling fans, vent covers and appliances.
-Cleaning carpets, area rugs and draperies.
-Cleaning inside the refrigerator, the stove and all cabinets.
-Removing stains from carpets, floors, counters, sinks, baths, tile, walls and grout.
-Eliminating house odors, especially if you have pets.
-Considering air fresheners or potpourri.
Tip #6: Make minor repairs
The small stuff does count, especially with first-time home buyers. Without dismissing the importance of repairing major items such as a leaky roof or plumbing, you do not need to spend money on replacing these items. Instead, focus on the minor repairs that will make your home visually appealing. The best ways to improve your home include:
-Repairing ceilings and wall cracks.
-Repairing faucets, banisters, handrails, cabinets, drawers, doors, floors and tile.
-Caulking and grouting tubs, showers, sinks and tile.
-Adding fresh paint to ceilings, walls, trim, doors and cabinets.
-Tightening door handles, drawer pulls, light switches and electrical plates.
-Lubricating door hinges and locks.
Tip #7: Showcase the kitchen
The heart of any home is the kitchen. If you are going to spend any money on renovations, this is the one area where you will see the greatest return. Even with a modest budget, focusing on a few key areas can make a great difference in getting the asking price for your property. The best ways to showcase the kitchen include:
-Replacing cabinet doors and hardware.
-Installing under-cabinet lighting.
-Replacing light fixtures.
-Replacing outdated shelving with pantry and cabinet organizers to maximize space.
-Baking cookies or cupcakes for a showing, to create a homey smell.
Tip #8: Stage furniture
Furniture placement can enhance the space of your home while giving buyers an idea of how to best utilize the space with their own belongings. Take some time to rethink how different areas in your house could be used. Some ideas to think about include:
-Moving couches and chairs away from walls in your sitting and family rooms to create cozy conversational groups.
-Creating a reading corner in the master bedroom.
-Clearing an empty room to set up a reading space.
-Turning an awkward space into a home office.
-Setting the dining room table with your best china.
-Set wine glasses in front of the fireplace or next to a Jacuzzi tub.
Tip #9: Light up the house
Create a sense of openness and cheerfulness in your home through its lighting. To improve the lighting try:
-Opening shades and drapes to let the sunshine warm and brighten rooms.
-Installing brighter light bulbs in rooms that tend to be dark.
-Adding additional lamps for ambient lighting.
-Turning on all the lights for a showing.
Tip #10: Add fresh touches
You can easily add color and style to your home by adding fresh touches throughout. Some ideas to consider include:
-Placing fresh floral arrangements in the entry and master bedroom.
-Placing bowls of bright-colored fruit in the family room and the kitchen.
-Filling an empty corner with a potted leafy plant.
-Setting new hand soap in the bathrooms.
-Displaying fresh towels near sinks.
Tip #1: Refresh the exterior
First impressions count when it comes to selling a home. Most buyers won’t even leave their car if they don’t find the exterior appealing. The best ways to improve your home’s exterior include:
-Repairing and/or replacing trims, shutters, gutters, shingles, mailboxes, window screens, walkways and the driveway.
-Painting siding, trim and shutters and lamp and mailbox posts.
-Pressure washing vinyl siding, roofs, walkways and the driveway.
-Washing windows.
Tip #2: Spruce up the lawn and landscape
Home buyers associate the condition of your lawn and landscaping with the condition of your home’s interior. By improving the outside, you affect buyers’ impression of the entire property. The best ways to enhance the yard include:
-Mowing and edging the lawn.
-Seeding, fertilizing and weeding the lawn.
-Keeping up with regular lawn maintenance by frequent watering.
-Trimming and/or removing overgrown trees, shrubs and hedges.
-Weeding and mulching plant beds.
-Planting colorful seasonal flowers in existing plant beds.
-Removing trash, especially along fences and underneath hedges.
-Sweeping and weeding the street curb along your property.
Tip #3: Create an inviting entrance
The front door to your home should invite buyers to enter. The best ways to improve your entry include:
-Painting the front door in a glossy, cheerful color that complements the exterior.
-Cleaning, polishing and/or replacing the door knocker, locks and handles.
-Repairing and/or replacing the screen door, the doorbell, porch lights and house numbers.
-Placing a new welcome mat and a group of seasonal potted plants and flowers by the entry.
Tip #4: Reduce clutter and furniture
A buyer cannot envision living in your home without seeing it. A home filled with clutter or even too much furniture distracts buyers from seeing how they can utilize the space your home offers. If you have limited storage space, you may want to consider renting a temporary storage unit to place items you wish to keep. The best ways to declutter your home include:
-Holding a garage sale to prepare for your move, getting rid of unnecessary items.
-Removing clutter such as books, magazines, toys, tools, supplies and unused items from counter tops, open shelves, storage closets, the garage and basements.
-Storing out-of-season clothing and shoes out of sight to make bedroom closets seem roomier.
-Removing any visibly damaged furniture.
-Organizing bookshelves, closets, cabinets and pantries. Buyers will inspect everything.
-Putting away your personal photographs, unless they showcase the home. Let buyers see themselves in your home.
-De-personalize rooms as much as you can.
Tip #5: Clean, clean, clean
The cleanliness of your home also influences a buyer's perception of its condition. The appearance of the kitchen and bathrooms will play a considerable role in a buyer's decision process, so pay particular attention to these areas. The best ways to improve these areas include:
-Cleaning windows, fixtures, hardware, ceiling fans, vent covers and appliances.
-Cleaning carpets, area rugs and draperies.
-Cleaning inside the refrigerator, the stove and all cabinets.
-Removing stains from carpets, floors, counters, sinks, baths, tile, walls and grout.
-Eliminating house odors, especially if you have pets.
-Considering air fresheners or potpourri.
Tip #6: Make minor repairs
The small stuff does count, especially with first-time home buyers. Without dismissing the importance of repairing major items such as a leaky roof or plumbing, you do not need to spend money on replacing these items. Instead, focus on the minor repairs that will make your home visually appealing. The best ways to improve your home include:
-Repairing ceilings and wall cracks.
-Repairing faucets, banisters, handrails, cabinets, drawers, doors, floors and tile.
-Caulking and grouting tubs, showers, sinks and tile.
-Adding fresh paint to ceilings, walls, trim, doors and cabinets.
-Tightening door handles, drawer pulls, light switches and electrical plates.
-Lubricating door hinges and locks.
Tip #7: Showcase the kitchen
The heart of any home is the kitchen. If you are going to spend any money on renovations, this is the one area where you will see the greatest return. Even with a modest budget, focusing on a few key areas can make a great difference in getting the asking price for your property. The best ways to showcase the kitchen include:
-Replacing cabinet doors and hardware.
-Installing under-cabinet lighting.
-Replacing light fixtures.
-Replacing outdated shelving with pantry and cabinet organizers to maximize space.
-Baking cookies or cupcakes for a showing, to create a homey smell.
Tip #8: Stage furniture
Furniture placement can enhance the space of your home while giving buyers an idea of how to best utilize the space with their own belongings. Take some time to rethink how different areas in your house could be used. Some ideas to think about include:
-Moving couches and chairs away from walls in your sitting and family rooms to create cozy conversational groups.
-Creating a reading corner in the master bedroom.
-Clearing an empty room to set up a reading space.
-Turning an awkward space into a home office.
-Setting the dining room table with your best china.
-Set wine glasses in front of the fireplace or next to a Jacuzzi tub.
Tip #9: Light up the house
Create a sense of openness and cheerfulness in your home through its lighting. To improve the lighting try:
-Opening shades and drapes to let the sunshine warm and brighten rooms.
-Installing brighter light bulbs in rooms that tend to be dark.
-Adding additional lamps for ambient lighting.
-Turning on all the lights for a showing.
Tip #10: Add fresh touches
You can easily add color and style to your home by adding fresh touches throughout. Some ideas to consider include:
-Placing fresh floral arrangements in the entry and master bedroom.
-Placing bowls of bright-colored fruit in the family room and the kitchen.
-Filling an empty corner with a potted leafy plant.
-Setting new hand soap in the bathrooms.
-Displaying fresh towels near sinks.
Wednesday, October 13, 2010
Five Smart Reasons to Buy a Home Now
The economy is stabilizing. Home prices are holding. It's not just as good a time as ever to buy a house. It's one of the best times ever.
ForSaleByOwner.com presents five overlooked reasons why now is a great time to buy a house.
1. Low mortgage rates serve as an equity shock absorber. When buyers borrow at today's record-low rates, they start building equity as soon as they close. That means they have a little give to absorb a few ups and downs as the still-recovering housing market gains traction.
2. Houses are in move-in condition. Homeowners have continued to spend on maintenance and repair, according to the Harvard Joint Center on Housing. Homeowners who have been holding back kept their houses in good shape while they waited. As those houses enter the market, they are in marked contrast to tattered foreclosures.
3. Terrific houses are coming on the market. Foreclosures are finally starting to clear the system – and this is just the opportunity that owners of many desirable properties have been waiting for.
4. Appraisal regulations are finally aligned with market realities. Fannie Mae has adjusted its appraisal guidelines...again. Now that appraisers have more flexibility to set values that reflect the current market, today's deals will make it over the finish line.
5. Plenty of programs. Homes are more affordable than they have been for years, but communities have stuck by "workforce housing" programs that encourage middle-class families to buy houses. Buyers who qualify can get a big boost by combining one of these programs with today's low mortgage rates.
ForSaleByOwner.com presents five overlooked reasons why now is a great time to buy a house.
1. Low mortgage rates serve as an equity shock absorber. When buyers borrow at today's record-low rates, they start building equity as soon as they close. That means they have a little give to absorb a few ups and downs as the still-recovering housing market gains traction.
2. Houses are in move-in condition. Homeowners have continued to spend on maintenance and repair, according to the Harvard Joint Center on Housing. Homeowners who have been holding back kept their houses in good shape while they waited. As those houses enter the market, they are in marked contrast to tattered foreclosures.
3. Terrific houses are coming on the market. Foreclosures are finally starting to clear the system – and this is just the opportunity that owners of many desirable properties have been waiting for.
4. Appraisal regulations are finally aligned with market realities. Fannie Mae has adjusted its appraisal guidelines...again. Now that appraisers have more flexibility to set values that reflect the current market, today's deals will make it over the finish line.
5. Plenty of programs. Homes are more affordable than they have been for years, but communities have stuck by "workforce housing" programs that encourage middle-class families to buy houses. Buyers who qualify can get a big boost by combining one of these programs with today's low mortgage rates.
Sunday, October 10, 2010
8 Tips to Getting Your Loan Modification Application Reviewed
Many homeowners seeking a loan modification to lower their monthly mortgage payments and avoid foreclosure continue to find the application process a complex web, often causing them to give up before their application is ever reviewed by their mortgage company.
Certified housing counselors for CredAbility, a national nonprofit credit counseling and education agency, speak daily with hundreds of homeowners seeking a loan modification or other solutions to keep their homes. The organization has several tips for people that will help them increase the chances that their application is reviewed as quickly as possible.
"A homeowner needs to collect and send several documents that tell the mortgage company why you need a modification, and it needs to be done in a timely, organized manner," said Michelle Jones, senior vice president of counseling for CredAbility. "Once a homeowner has submitted these documents, they need to stay in regular contact with the company. With hundreds of thousands of applications under consideration, homeowners must take matters into their own hands to make sure their application gets to the right person at the company."
Here are CredAbility's recommendations for homeowners seeking a loan modification:
Speak With a Nonprofit Housing Counselor to Understand Investor Rules for Your Loan. Every homeowner's mortgage loan is different, so don't rely on information you may have heard from your neighbor or your sister-in-law, even if they received a loan modification. For example, if your 30-year, fixed interest rate loan is owned by one investor, and your neighbor's is owned by another investor, the rules governing a loan modification may be quite different. A certified counselor at a nonprofit credit counseling agency can help you find the investor who owns your mortgage and determine your options.
Submit All Documents That Prove Your Current Income. Income verification is critical, but homeowners sometimes don't provide their mortgage company with recent documents. If you lost a job in June, don't provide pay stubs from March. In addition to recent pay stubs and other traditional income sources, homeowners should also provide a document called a "contribution letter." This letter explains the source of any household income that is not easily verified. For example, a servicer will want to know the total household income of a married couple, even if only one person's name is on the loan. The letter could also include income verifying that you have a roommate that pays rent.
Submit Current Bank Statements. Recent bank statements allow your mortgage company to verify your income and expenses. This information enables the mortgage company to see your monthly expenses for food, utilities and other expenses and determine whether you will have enough money to make your mortgage payment.
Mail Your Documents to the Mortgage Company. Many people prefer to send all of their documents by fax or scan their documents and send them via email. However, postal mail is usually more reliable, especially if it's addressed to the person you spoke with at the mortgage company. Faxes often get lost.
Label Each Page With Your Name and Loan Number. One of the most common complaints among homeowners is that the mortgage company loses their documents. You can help your own cause by writing your name and loan number on each page of every document.
Fully Explain Any Recent or Unique Income Changes. For example, a bank deposit may show various one-time transactions, such as an asset sale, cash gifts from family members or a bonus. Unless you explain this one-time increase in income, the servicer may not understand it and use this information to deny your loan modification.
Include a Timeline in Your Hardship Letter. Every application for a loan modification must include a "hardship letter" that explains the reasons for your request. But the letter must have specific dates explaining when an income loss has occurred. If your spouse lost her job on July 15 and your family income will decrease by $3,000 beginning in August, your letter needs to provide these details.
Call Your Mortgage Company Every Week. Many homeowners work extremely hard to submit all of their paperwork to the servicer - and then wait for weeks before picking up the telephone to call them about the status of their application. This is a mistake for several reasons: the person handling your application may quit; the application may be transferred to another person; the company may need more information. You get the picture.
Certified housing counselors for CredAbility, a national nonprofit credit counseling and education agency, speak daily with hundreds of homeowners seeking a loan modification or other solutions to keep their homes. The organization has several tips for people that will help them increase the chances that their application is reviewed as quickly as possible.
"A homeowner needs to collect and send several documents that tell the mortgage company why you need a modification, and it needs to be done in a timely, organized manner," said Michelle Jones, senior vice president of counseling for CredAbility. "Once a homeowner has submitted these documents, they need to stay in regular contact with the company. With hundreds of thousands of applications under consideration, homeowners must take matters into their own hands to make sure their application gets to the right person at the company."
Here are CredAbility's recommendations for homeowners seeking a loan modification:
Speak With a Nonprofit Housing Counselor to Understand Investor Rules for Your Loan. Every homeowner's mortgage loan is different, so don't rely on information you may have heard from your neighbor or your sister-in-law, even if they received a loan modification. For example, if your 30-year, fixed interest rate loan is owned by one investor, and your neighbor's is owned by another investor, the rules governing a loan modification may be quite different. A certified counselor at a nonprofit credit counseling agency can help you find the investor who owns your mortgage and determine your options.
Submit All Documents That Prove Your Current Income. Income verification is critical, but homeowners sometimes don't provide their mortgage company with recent documents. If you lost a job in June, don't provide pay stubs from March. In addition to recent pay stubs and other traditional income sources, homeowners should also provide a document called a "contribution letter." This letter explains the source of any household income that is not easily verified. For example, a servicer will want to know the total household income of a married couple, even if only one person's name is on the loan. The letter could also include income verifying that you have a roommate that pays rent.
Submit Current Bank Statements. Recent bank statements allow your mortgage company to verify your income and expenses. This information enables the mortgage company to see your monthly expenses for food, utilities and other expenses and determine whether you will have enough money to make your mortgage payment.
Mail Your Documents to the Mortgage Company. Many people prefer to send all of their documents by fax or scan their documents and send them via email. However, postal mail is usually more reliable, especially if it's addressed to the person you spoke with at the mortgage company. Faxes often get lost.
Label Each Page With Your Name and Loan Number. One of the most common complaints among homeowners is that the mortgage company loses their documents. You can help your own cause by writing your name and loan number on each page of every document.
Fully Explain Any Recent or Unique Income Changes. For example, a bank deposit may show various one-time transactions, such as an asset sale, cash gifts from family members or a bonus. Unless you explain this one-time increase in income, the servicer may not understand it and use this information to deny your loan modification.
Include a Timeline in Your Hardship Letter. Every application for a loan modification must include a "hardship letter" that explains the reasons for your request. But the letter must have specific dates explaining when an income loss has occurred. If your spouse lost her job on July 15 and your family income will decrease by $3,000 beginning in August, your letter needs to provide these details.
Call Your Mortgage Company Every Week. Many homeowners work extremely hard to submit all of their paperwork to the servicer - and then wait for weeks before picking up the telephone to call them about the status of their application. This is a mistake for several reasons: the person handling your application may quit; the application may be transferred to another person; the company may need more information. You get the picture.
Saturday, October 9, 2010
10 Tips to Conserve Water
Summer is on its way out and the rains may even slow. Still, it's more important that ever to conserve water. From checking the kitchen faucet to watching your laundry loads, there's plenty we can all do to save water.
Here are some tips from Pennsylvania American Water on how you can conserve water and reduce the environmental impact of water consumption both indoors and outside the home:
1. Water your lawn only when it needs it. An easy test to tell if your lawn needs water is to simply walk across the grass. If you leave footprints, it's time to water. (An added benefit of watering less often is that fewer, deep-soaking waterings encourage deep root growth and stronger turf.)
2. Water in the early morning. As much as 30 percent of water can be lost to evaporation by watering during midday.
3. Set your lawn mower one notch higher to make your lawn more drought-tolerant.
4. Use drip irrigation hoses to water plants, and water in the early morning or evening.
5. Use a broom instead of a hose to clean your sidewalk, driveway, or patio.
6. Forego the hose and wash your car with a bucket and sponge instead. According to EPA WaterSense, a hose left running can waste as much as six gallons per minute while a bucket and sponge uses only a few gallons to do the job.
7. Keep a bottle of cold tap water in the refrigerator. You'll avoid the cost and environmental impact of bottled water and you'll have cold water available in the summer without running the faucet.
8. Run dishwashers and clothes washers only when they are full. If you have a water-saver cycle, use it.
9. Adjust the water level of your clothes washer, so that it matches your load size.
10. Regularly check your toilet, faucets and pipes for leaks and have them fixed promptly. An easy test for toilet leaks from EPA WaterSense: Place a drop of food coloring in the tank. If the color tints the water in the bowl without flushing, there's a leak. Check your water meter before and after a two-hour period when no water is being used. If the meter changes at all, you probably have a leak.
Here are some tips from Pennsylvania American Water on how you can conserve water and reduce the environmental impact of water consumption both indoors and outside the home:
1. Water your lawn only when it needs it. An easy test to tell if your lawn needs water is to simply walk across the grass. If you leave footprints, it's time to water. (An added benefit of watering less often is that fewer, deep-soaking waterings encourage deep root growth and stronger turf.)
2. Water in the early morning. As much as 30 percent of water can be lost to evaporation by watering during midday.
3. Set your lawn mower one notch higher to make your lawn more drought-tolerant.
4. Use drip irrigation hoses to water plants, and water in the early morning or evening.
5. Use a broom instead of a hose to clean your sidewalk, driveway, or patio.
6. Forego the hose and wash your car with a bucket and sponge instead. According to EPA WaterSense, a hose left running can waste as much as six gallons per minute while a bucket and sponge uses only a few gallons to do the job.
7. Keep a bottle of cold tap water in the refrigerator. You'll avoid the cost and environmental impact of bottled water and you'll have cold water available in the summer without running the faucet.
8. Run dishwashers and clothes washers only when they are full. If you have a water-saver cycle, use it.
9. Adjust the water level of your clothes washer, so that it matches your load size.
10. Regularly check your toilet, faucets and pipes for leaks and have them fixed promptly. An easy test for toilet leaks from EPA WaterSense: Place a drop of food coloring in the tank. If the color tints the water in the bowl without flushing, there's a leak. Check your water meter before and after a two-hour period when no water is being used. If the meter changes at all, you probably have a leak.
Thursday, October 7, 2010
A Little Bit of Organization Can Go a Long Way
Sometimes all a home really needs is a littile bit of organization...in this case, not to sound cliche, but a little bit certainly does go a long way.
It's easy to get bogged down by clutter throughout our daily lives. And, if you're renovating, project remnants compound the problem. Here are some tips, courtesy of Lowe's, to help you stay clutter-free:
Daily Clean-up
If you stay on top of simple chores every day, the bigger organization projects won't appear as overwhelming. Keep the house tidy by doing the small stuff daily. Make your bed each morning. After meals, do the dishes. And keep dirty laundry off the floor and in the hamper.
Storage Under the Bed
A lot of people forget the amount of storage a bed (or any other raised furniture) provides. You can store a lot under your bed in storage containers and boxes. The same can apply for sofas and chairs that have ample clearance. Just make sure your storage is out of sight with skirts. Think outside of the closet. The underside of your bed is the perfect place to store comforters, bedspreads and pillowcases.
Give Your Shoes the Rack
Often, closet floors suffer from shoe infestations. A cobbler's clutter can be easily solved with a tiered shoe rack. A shoe rack organizes your footwear while keeping them readily available (a luxury not afforded if you're using stacked boxes). A rack also keeps shoes in better condition, as they are kept away from the dirt and dust that collect on the floor. As you begin organizing, remember to keep shoes grouped by type and color. Heels, flats and sneakers should have their own sections. If your collection exceeds a rack, hang additional pairs from the inside of your closet door.
Kitchen Zoning
Your kitchen will house a wide range of dinnerware, food, storage and cooking items. Create separate areas for each kitchen activity. Keep your baking utensils, appliances, pans and sheets grouped together. And designate a specific spot on the countertop or island for use. Do the same for your grilling, frying and juicing needs.
Food storage can also get messy. Make sure your plastic food containers are adequately stored by size and shape. And clean out your refrigerator regularly. Don't forget to keep an opened box of baking soda in the fridge's corner to help control odors.
Finally, set up a shelving system for your pantry, and group your foodstuffs accordingly. Remember, it's best to not mix your cereals with the kitty litter. Cans – separated by vegetable and fruits – go on one shelf, while grains go on another. Spices should get their own rack.
Manage Magazines and Mail
Keep your magazines stored in a specific location instead of sprawled throughout your house. Group your periodicals by title and date. Give your mail the same treatment. Group your bills separately from other important letters and announcements. And trash junk mail immediately. Remember to shred any mail that may contain personal information. Baskets and racks help control the printed pages, especially if you're an avid reader.
Tame the Toys
Keep toys stored in plastic bins or hampers that are low to the ground. You want to make sure toy storage is easily accessible for your child. As kids grow, they'll start cleaning on their own. You can even make tidying up another game to play (e.g. shoot hoops with stranded Legos). Like the rest of your belongings, try to specialize each container. Keep one for books and crafts, and another for larger toys like trains or stuffed animals.
In the Garage
Garages usually become a default space for sporting goods, garden supplies and tools. If poorly managed, a garage can quickly become an eyesore. Keep your garage organized with wall systems, cabinets, worktables and shelving units. There are also specialized containers for nails, screws, nuts and bolts to help minimize the mess. Keep sporting goods, like bicycles and skiing gear, on hooks hung from your garage's walls or ceiling. Gardening supplies, like fertilizer and pesticides, should be properly sealed and stored out of reach from children.
Like the organization projects inside, keep your garage's contents separated by their function: tools with tools, toys with toys, etc.
It's easy to get bogged down by clutter throughout our daily lives. And, if you're renovating, project remnants compound the problem. Here are some tips, courtesy of Lowe's, to help you stay clutter-free:
Daily Clean-up
If you stay on top of simple chores every day, the bigger organization projects won't appear as overwhelming. Keep the house tidy by doing the small stuff daily. Make your bed each morning. After meals, do the dishes. And keep dirty laundry off the floor and in the hamper.
Storage Under the Bed
A lot of people forget the amount of storage a bed (or any other raised furniture) provides. You can store a lot under your bed in storage containers and boxes. The same can apply for sofas and chairs that have ample clearance. Just make sure your storage is out of sight with skirts. Think outside of the closet. The underside of your bed is the perfect place to store comforters, bedspreads and pillowcases.
Give Your Shoes the Rack
Often, closet floors suffer from shoe infestations. A cobbler's clutter can be easily solved with a tiered shoe rack. A shoe rack organizes your footwear while keeping them readily available (a luxury not afforded if you're using stacked boxes). A rack also keeps shoes in better condition, as they are kept away from the dirt and dust that collect on the floor. As you begin organizing, remember to keep shoes grouped by type and color. Heels, flats and sneakers should have their own sections. If your collection exceeds a rack, hang additional pairs from the inside of your closet door.
Kitchen Zoning
Your kitchen will house a wide range of dinnerware, food, storage and cooking items. Create separate areas for each kitchen activity. Keep your baking utensils, appliances, pans and sheets grouped together. And designate a specific spot on the countertop or island for use. Do the same for your grilling, frying and juicing needs.
Food storage can also get messy. Make sure your plastic food containers are adequately stored by size and shape. And clean out your refrigerator regularly. Don't forget to keep an opened box of baking soda in the fridge's corner to help control odors.
Finally, set up a shelving system for your pantry, and group your foodstuffs accordingly. Remember, it's best to not mix your cereals with the kitty litter. Cans – separated by vegetable and fruits – go on one shelf, while grains go on another. Spices should get their own rack.
Manage Magazines and Mail
Keep your magazines stored in a specific location instead of sprawled throughout your house. Group your periodicals by title and date. Give your mail the same treatment. Group your bills separately from other important letters and announcements. And trash junk mail immediately. Remember to shred any mail that may contain personal information. Baskets and racks help control the printed pages, especially if you're an avid reader.
Tame the Toys
Keep toys stored in plastic bins or hampers that are low to the ground. You want to make sure toy storage is easily accessible for your child. As kids grow, they'll start cleaning on their own. You can even make tidying up another game to play (e.g. shoot hoops with stranded Legos). Like the rest of your belongings, try to specialize each container. Keep one for books and crafts, and another for larger toys like trains or stuffed animals.
In the Garage
Garages usually become a default space for sporting goods, garden supplies and tools. If poorly managed, a garage can quickly become an eyesore. Keep your garage organized with wall systems, cabinets, worktables and shelving units. There are also specialized containers for nails, screws, nuts and bolts to help minimize the mess. Keep sporting goods, like bicycles and skiing gear, on hooks hung from your garage's walls or ceiling. Gardening supplies, like fertilizer and pesticides, should be properly sealed and stored out of reach from children.
Like the organization projects inside, keep your garage's contents separated by their function: tools with tools, toys with toys, etc.
Wednesday, October 6, 2010
10 Value-Adding Home Improvement Projects
If you are looking for ways to add value to your home, the following home improvements may be just what you’re looking for.
Tip 1: Remodel your kitchen
Kitchen updates are one of the best ways to increase the value of your home. Adding modern appliances and refacing your cabinets to give it a more modern look is well worth the investment.
Tip 2: Add a Garage
Homes with at least a two car garage are more attractive to potential home buyers. Having a home with a small garage is almost as bad as having no garage, so consider upgrading before putting your home on the market.
Tip 3: Remodel your bathroom
Bathrooms are very important to home buyers. Just as with the kitchen, home buyers look for modern conveniences. Adding a Jacuzzi bathtub, painting the walls and adding appropriate flooring will go a long way toward increasing your home’s value.
Tip 4: Install the right flooring material
Natural materials such as wood and ceramic are popular among home buyers today. Laminate flooring is a good option, as well, as it creates a natural look without the headaches associated with natural flooring materials.
Tip 5: Install granite counter tops
Granite counter tops are popular in both kitchens and bathrooms. These countertops are low maintenance and quite attractive and can add significant value to your remodel.
Tip 6: Increase curb appeal
Your home needs to grab a potential home buyer’s attention and look great as soon as he or she pulls in the driveway. Add flowers to the outside of your home and make sure it looks bright and cheery.
Tip 7: Add natural light
Home buyers like homes that are bright and cheery on the inside as well as the outside. Look for places to add windows or patio doors that will allow more natural light to come in.
Tip 8: Open up the space
Homes with an open floor plan are more valuable to home buyers than those that feel closed up. Knock out walls wherever possible and open your home up. A great place take out a wall is between your kitchen and your dining room.
Tip 9: Apply a fresh coat of paint
A fresh coat of paint makes a home look new again. When repainting walls, choose neutral colors that don’t stand out too much. Bold colors may be attractive to you, but they may be a turnoff to potential buyers.
Tip 10: Clean up clutter
A cluttered home appears small and dirty. Make certain all clutter is cleaned up on the inside and the outside of the home. Rearrange furniture or remove furniture in order to make the home feel less cramped.
Tip 1: Remodel your kitchen
Kitchen updates are one of the best ways to increase the value of your home. Adding modern appliances and refacing your cabinets to give it a more modern look is well worth the investment.
Tip 2: Add a Garage
Homes with at least a two car garage are more attractive to potential home buyers. Having a home with a small garage is almost as bad as having no garage, so consider upgrading before putting your home on the market.
Tip 3: Remodel your bathroom
Bathrooms are very important to home buyers. Just as with the kitchen, home buyers look for modern conveniences. Adding a Jacuzzi bathtub, painting the walls and adding appropriate flooring will go a long way toward increasing your home’s value.
Tip 4: Install the right flooring material
Natural materials such as wood and ceramic are popular among home buyers today. Laminate flooring is a good option, as well, as it creates a natural look without the headaches associated with natural flooring materials.
Tip 5: Install granite counter tops
Granite counter tops are popular in both kitchens and bathrooms. These countertops are low maintenance and quite attractive and can add significant value to your remodel.
Tip 6: Increase curb appeal
Your home needs to grab a potential home buyer’s attention and look great as soon as he or she pulls in the driveway. Add flowers to the outside of your home and make sure it looks bright and cheery.
Tip 7: Add natural light
Home buyers like homes that are bright and cheery on the inside as well as the outside. Look for places to add windows or patio doors that will allow more natural light to come in.
Tip 8: Open up the space
Homes with an open floor plan are more valuable to home buyers than those that feel closed up. Knock out walls wherever possible and open your home up. A great place take out a wall is between your kitchen and your dining room.
Tip 9: Apply a fresh coat of paint
A fresh coat of paint makes a home look new again. When repainting walls, choose neutral colors that don’t stand out too much. Bold colors may be attractive to you, but they may be a turnoff to potential buyers.
Tip 10: Clean up clutter
A cluttered home appears small and dirty. Make certain all clutter is cleaned up on the inside and the outside of the home. Rearrange furniture or remove furniture in order to make the home feel less cramped.
Tuesday, October 5, 2010
The Right Decisions Can Save Money During a Move
Moving a residence is often fraught with high emotions and involves a to-do list a mile long. So, it's tempting to give only passing attention to hiring a mover and the related incidental costs.
That could be a mistake — for your wallet and your peace of mind.
Moving can be quite expensive. A typical full-service interstate move costs about $4,300, while the same in-state move might cost about $2,500, according to the American Moving & Storage Association.
And while the moving industry has many fine companies, it is notorious for fraud and dirty tactics by so-called rogue movers.
Here are tips on making your move with lower costs and less hassle.
CHOOSE A TYPE OF MOVE: You have three basic choices: do-it-yourself, full service and a relatively new hybrid of the two. Going it alone is cheapest, costing the rental price of a truck, gasoline, packing materials and, perhaps, pizza and beer for friends you rope into helping.
With full-service moves, moving within a state is charged by the hour, while moving across state lines is charged by weight and mileage.
With a hybrid move, a mover will drop off a large container at your home for you to pack. It will then load the container onto a truck, drive the belongings to your new location and drop off the container for you to unload. Because you're doing the manual labor of packing and unpacking, it's far less costly than a full-service move.
HIRE A QUALITY MOVER: If you hire help, get at least three price quotes and do homework. Seek recommendations by talking with family and friends, even your Facebook circle. Investigate a company's reputation with the Better Business Bureau (bbb.org), Yelp.com and possibly the paid-membership site Angie's List (angieslist.com). Check a company's complaint history at the federal government site, ProtectYourMove.gov.
"People think a good reputation equals expensive, but that's not true," said Laura McHolm, co-founder of NorthStar Moving in Los Angeles. "You don't get a good reputation by overcharging people."
For interstate moves, a company's ProMover certification with the movers association is a good sign. The organization in January 2009 started screening movers based on seven criteria. It kicked out some 220 of 3,100 members over the past two years because they didn't measure up, said spokesman John Bisney. See "Find a ProMover" at Moving.org.
"The old rubric 'You get what you pay for' is true more often than not," Bisney said.
Look for two things: A full-service mover should visit your home in person, not give a quote over the phone or online, and should provide a written estimate, experts say.
DECLUTTER: No matter what type of move you're making, taking less stuff is cheaper and less hassle. Set up a staging area, perhaps in a garage, with various piles, such as throw out, recycle, donate and sell.
"If you really love those go-go boots from the 1960s but will never wear them again, take a picture of them and get rid of them," McHolm said. For many items, use the rule of thumb, "If you haven't used it in a year, you probably don't need it."
BE FLEXIBLE: Like airline fares, moving rates depend on when you book. The busiest time for movers, and thus the most expensive time for consumers, is summer weekends near the 15th and 30th of the month.
If you have time flexibility, ask what rates would be for different days or seasons. If you have extreme flexibility, ask about moving standby: waiting until the mover has extra space and needs to fill a truck.
SAVE ON BOXES: Buying new boxes from a moving company is the most expensive choice. Ask if you can buy used boxes from your moving company. NorthStar, for example, gives customers 25 percent off used boxes and then refunds 25 percent if they return boxes in usable condition.
Cheaper yet is finding free boxes, ideally from somebody who just moved. Ask your real estate agent to connect you with other clients who recently moved. Or look on Craigslist.org. Specialty boxes, such as wardrobe boxes, might be cheaper to purchase at a do-it-yourself moving store, such as U-Haul, than from your mover.
SAVE ON PACKING MATERIALS: If you're packing yourself, fill suitcases, laundry baskets and plastic containers with unbreakable items. Use pillows, scarves and towels to wrap fragile belongings. And you might as well empty your paper shredder into a box to add cushion.
MAIL BOOKS: If you have many books, pack them yourself and ship them at the postal media mail rate. It might be cheaper than paying a mover. A 70-pound box would cost less than $30. You can't send anything with advertisements, so magazines are out. Search USPS.com for "media mail."
CONSIDER CONSOLIDATION: For long-distance moves, ask about consolidating your stuff on a truck with other people's. Most homeowners can't fill a full-size moving van. You might have to be flexible on delivery dates and times, but consolidation can be cheaper. "Most times it's a huge price difference," McHolm said.
INSURE IT: Check your homeowner's or renter's insurance policy to determine whether it provides coverage for your belongings while in transit. If not, you'll probably want more than the basic free valuation coverage a full-service mover provides. The standard valuation is 60 cents per pound per item. That means breaking a 10-pound, $1,000 stereo system would net you $6. You'll want full replacement-value insurance, which reimburses you what it will cost to replace broken items. But don't necessarily buy that insurance from the moving company. Moving insurance is likely cheaper from a third party, such as MovingInsurance.com, McHolm said.
Be aware that you probably cannot get insurance on boxes you packed yourself. A mover must pack them.
BE PREPARED: Plot out where furniture and boxes will go. The less time movers spend rearranging, the less expensive it will be.
In urban areas, reserve a space or two in front of your new home for the moving truck by parking your own vehicle there ahead of time. If the movers have to park too far away to unload, you could incur a "long carry" surcharge, McHolm said.
STAKE YOUR CLAIM: If you're moving for a job, negotiate the best relocation package you can. Unreimbursed expenses might be tax-deductible. For details, see Publication 521 Moving Expenses at IRS.gov.
TIP: Tipping each mover $3 to $5 per hour is customary, said Stephen Coady, marketing manager for Gentle Giant Moving Co. in Somerville, Mass.
For in-depth information on choosing a mover, see the free, downloadable "Make a Smart Move" available at Moving.org.
MOVING RIPOFFS:
—Furniture nabbing. A mover essentially holds your belongings hostage, demanding a higher payment to release them.
—Lowballers. Beware of lowball price quote. They could end up costing you as the mover adds various surcharges.
—Instant quotes. Be wary of phone or Internet estimates. Get written, in-home estimates.
—Large down payment. Be suspicious of carriers seeking large deposits. They might take the money and run. Legitimate movers require no deposit or a small "good faith" down payment.
That could be a mistake — for your wallet and your peace of mind.
Moving can be quite expensive. A typical full-service interstate move costs about $4,300, while the same in-state move might cost about $2,500, according to the American Moving & Storage Association.
And while the moving industry has many fine companies, it is notorious for fraud and dirty tactics by so-called rogue movers.
Here are tips on making your move with lower costs and less hassle.
CHOOSE A TYPE OF MOVE: You have three basic choices: do-it-yourself, full service and a relatively new hybrid of the two. Going it alone is cheapest, costing the rental price of a truck, gasoline, packing materials and, perhaps, pizza and beer for friends you rope into helping.
With full-service moves, moving within a state is charged by the hour, while moving across state lines is charged by weight and mileage.
With a hybrid move, a mover will drop off a large container at your home for you to pack. It will then load the container onto a truck, drive the belongings to your new location and drop off the container for you to unload. Because you're doing the manual labor of packing and unpacking, it's far less costly than a full-service move.
HIRE A QUALITY MOVER: If you hire help, get at least three price quotes and do homework. Seek recommendations by talking with family and friends, even your Facebook circle. Investigate a company's reputation with the Better Business Bureau (bbb.org), Yelp.com and possibly the paid-membership site Angie's List (angieslist.com). Check a company's complaint history at the federal government site, ProtectYourMove.gov.
"People think a good reputation equals expensive, but that's not true," said Laura McHolm, co-founder of NorthStar Moving in Los Angeles. "You don't get a good reputation by overcharging people."
For interstate moves, a company's ProMover certification with the movers association is a good sign. The organization in January 2009 started screening movers based on seven criteria. It kicked out some 220 of 3,100 members over the past two years because they didn't measure up, said spokesman John Bisney. See "Find a ProMover" at Moving.org.
"The old rubric 'You get what you pay for' is true more often than not," Bisney said.
Look for two things: A full-service mover should visit your home in person, not give a quote over the phone or online, and should provide a written estimate, experts say.
DECLUTTER: No matter what type of move you're making, taking less stuff is cheaper and less hassle. Set up a staging area, perhaps in a garage, with various piles, such as throw out, recycle, donate and sell.
"If you really love those go-go boots from the 1960s but will never wear them again, take a picture of them and get rid of them," McHolm said. For many items, use the rule of thumb, "If you haven't used it in a year, you probably don't need it."
BE FLEXIBLE: Like airline fares, moving rates depend on when you book. The busiest time for movers, and thus the most expensive time for consumers, is summer weekends near the 15th and 30th of the month.
If you have time flexibility, ask what rates would be for different days or seasons. If you have extreme flexibility, ask about moving standby: waiting until the mover has extra space and needs to fill a truck.
SAVE ON BOXES: Buying new boxes from a moving company is the most expensive choice. Ask if you can buy used boxes from your moving company. NorthStar, for example, gives customers 25 percent off used boxes and then refunds 25 percent if they return boxes in usable condition.
Cheaper yet is finding free boxes, ideally from somebody who just moved. Ask your real estate agent to connect you with other clients who recently moved. Or look on Craigslist.org. Specialty boxes, such as wardrobe boxes, might be cheaper to purchase at a do-it-yourself moving store, such as U-Haul, than from your mover.
SAVE ON PACKING MATERIALS: If you're packing yourself, fill suitcases, laundry baskets and plastic containers with unbreakable items. Use pillows, scarves and towels to wrap fragile belongings. And you might as well empty your paper shredder into a box to add cushion.
MAIL BOOKS: If you have many books, pack them yourself and ship them at the postal media mail rate. It might be cheaper than paying a mover. A 70-pound box would cost less than $30. You can't send anything with advertisements, so magazines are out. Search USPS.com for "media mail."
CONSIDER CONSOLIDATION: For long-distance moves, ask about consolidating your stuff on a truck with other people's. Most homeowners can't fill a full-size moving van. You might have to be flexible on delivery dates and times, but consolidation can be cheaper. "Most times it's a huge price difference," McHolm said.
INSURE IT: Check your homeowner's or renter's insurance policy to determine whether it provides coverage for your belongings while in transit. If not, you'll probably want more than the basic free valuation coverage a full-service mover provides. The standard valuation is 60 cents per pound per item. That means breaking a 10-pound, $1,000 stereo system would net you $6. You'll want full replacement-value insurance, which reimburses you what it will cost to replace broken items. But don't necessarily buy that insurance from the moving company. Moving insurance is likely cheaper from a third party, such as MovingInsurance.com, McHolm said.
Be aware that you probably cannot get insurance on boxes you packed yourself. A mover must pack them.
BE PREPARED: Plot out where furniture and boxes will go. The less time movers spend rearranging, the less expensive it will be.
In urban areas, reserve a space or two in front of your new home for the moving truck by parking your own vehicle there ahead of time. If the movers have to park too far away to unload, you could incur a "long carry" surcharge, McHolm said.
STAKE YOUR CLAIM: If you're moving for a job, negotiate the best relocation package you can. Unreimbursed expenses might be tax-deductible. For details, see Publication 521 Moving Expenses at IRS.gov.
TIP: Tipping each mover $3 to $5 per hour is customary, said Stephen Coady, marketing manager for Gentle Giant Moving Co. in Somerville, Mass.
For in-depth information on choosing a mover, see the free, downloadable "Make a Smart Move" available at Moving.org.
MOVING RIPOFFS:
—Furniture nabbing. A mover essentially holds your belongings hostage, demanding a higher payment to release them.
—Lowballers. Beware of lowball price quote. They could end up costing you as the mover adds various surcharges.
—Instant quotes. Be wary of phone or Internet estimates. Get written, in-home estimates.
—Large down payment. Be suspicious of carriers seeking large deposits. They might take the money and run. Legitimate movers require no deposit or a small "good faith" down payment.
Monday, October 4, 2010
Kitchen Remodels on the Comeback Trail
The explosion of remodeling shows on TV and makeover spreads in magazines has whetted America's appetite for glamorous rooms brimming with the latest furnishings, appliances and color schemes.
Kitchen remodels are among the most popular, according to a report in the just-published August issue of Consumer Reports and online at consumerreports.org. And the economic slowdown means there are outstanding deals on everything from cooktops to countertops. It also means kitchen designers and building contractors are eager for work and willing to negotiate.
But bargain prices and good looks aren't everything, said Celia Kupersmzid Lehrman, Consumer Reports' deputy home editor.
"When remodeling a kitchen, functionality is every bit as important as style. Fortunately there are many products that look good and work well," she said.
The design of your kitchen is every bit as important as what goes into it, said Jim Spence of Spence & Vaughn Fine Kitchen and Bath in Maitland, Fla.
The most functional design is based on the "work triangle" — the relationship between the prep area, the cooking area and the sink, he said. Ideally, the distance between them should never be less than four feet or more than nine feet. Of the three areas, the most-used is the sink.
When planning a remodel, determining your budget is one of the first steps. The National Kitchen & Bath Association calculates the average kitchen remodel costs between 10 percent and 20 percent of the home's value. But obviously, the extent of the makeover determines its cost. In its latest issue, Consumer Reports takes top-performing products and creates three design schemes: a do-it-yourself makeover for $5,000; a plan that costs $15,000 (the average spent on a kitchen remodel); and a full-scale renovation for $50,000.
Determining your priorities is another key step, said Phil Johnson, a partner at Spence & Vaughn and a certified kitchen designer.
"Do you love to cook? If so, now might be the time to consider professional-style appliances," he said. "Do you have a large family? Consider how best to accommodate them in your new space. Think about the things you love in your old kitchen — and the things you dislike."
In addition, Johnson recommends the following steps for a successful remodel:
—Do your homework. Watch TV remodeling programs, clip appealing pictures and articles from magazines, attend remodeling seminars, visit home shows and parades of homes. Consult with a kitchen designer who is a member of the NKBA, who has the training and experience to avoid many of the things that can go wrong with a remodeling project.
—Visit a showroom. Examine the options in cabinets, countertops, appliances, flooring, plumbing and lighting. Decide what you want — and can afford.
—Schedule a home visit. The designer/installer need to measure the kitchen and adjacent rooms, and make a note of existing walls, doors and windows, electrical supplies, ceiling height, attic access, type of wall construction, plumbing details, etc.
—Finalize the project. The design is refined, construction plans are completed, appliances and supplies are ordered — and the initial deposit is paid.
—Survive the dust, noise and workers. With proper supervision, the disruption can be kept to a minimum. Make sure materials are ordered and on the way before beginning the tear-out. Clear a space in the garage for workers' tools and supplies and items removed from the old kitchen. And communicate regularly with the designer/installer.
The August issue of Consumer Reports identifies these four rules for a successful kitchen remodel:
Don't rush. There are many kitchen products that combine value, performance and good looks. Take time to meet with professionals, browse the Internet and visit showrooms and home centers. Haste can be costly. Changing your mind after the project is started typically adds about $1,500 to the cost of a kitchen project.
Size matters. In addition to being expensive, oversized kitchens can be exhausting to work in and keep tidy. A more compact kitchen often functions better. The National Kitchen & Bath Association website, nkba.org, provides guidelines for optimal space between appliances, cabinets and islands.
Beware of budget busters. Leave a 10 percent to 15 percent cushion for surprises, such as unexpected structural repairs. Avoid settling for a cheap option, thinking someday you will replace it with something you really want. Chances are that will never happen.
Get it in writing. When using a professional for a remodel, the written contract should list each phase of the project; every product, including the model number; and copies of each contractor's license, and workers compensation and liability insurance to confirm they are current. Call references and, if possible, visit them.
Kitchen remodels are among the most popular, according to a report in the just-published August issue of Consumer Reports and online at consumerreports.org. And the economic slowdown means there are outstanding deals on everything from cooktops to countertops. It also means kitchen designers and building contractors are eager for work and willing to negotiate.
But bargain prices and good looks aren't everything, said Celia Kupersmzid Lehrman, Consumer Reports' deputy home editor.
"When remodeling a kitchen, functionality is every bit as important as style. Fortunately there are many products that look good and work well," she said.
The design of your kitchen is every bit as important as what goes into it, said Jim Spence of Spence & Vaughn Fine Kitchen and Bath in Maitland, Fla.
The most functional design is based on the "work triangle" — the relationship between the prep area, the cooking area and the sink, he said. Ideally, the distance between them should never be less than four feet or more than nine feet. Of the three areas, the most-used is the sink.
When planning a remodel, determining your budget is one of the first steps. The National Kitchen & Bath Association calculates the average kitchen remodel costs between 10 percent and 20 percent of the home's value. But obviously, the extent of the makeover determines its cost. In its latest issue, Consumer Reports takes top-performing products and creates three design schemes: a do-it-yourself makeover for $5,000; a plan that costs $15,000 (the average spent on a kitchen remodel); and a full-scale renovation for $50,000.
Determining your priorities is another key step, said Phil Johnson, a partner at Spence & Vaughn and a certified kitchen designer.
"Do you love to cook? If so, now might be the time to consider professional-style appliances," he said. "Do you have a large family? Consider how best to accommodate them in your new space. Think about the things you love in your old kitchen — and the things you dislike."
In addition, Johnson recommends the following steps for a successful remodel:
—Do your homework. Watch TV remodeling programs, clip appealing pictures and articles from magazines, attend remodeling seminars, visit home shows and parades of homes. Consult with a kitchen designer who is a member of the NKBA, who has the training and experience to avoid many of the things that can go wrong with a remodeling project.
—Visit a showroom. Examine the options in cabinets, countertops, appliances, flooring, plumbing and lighting. Decide what you want — and can afford.
—Schedule a home visit. The designer/installer need to measure the kitchen and adjacent rooms, and make a note of existing walls, doors and windows, electrical supplies, ceiling height, attic access, type of wall construction, plumbing details, etc.
—Finalize the project. The design is refined, construction plans are completed, appliances and supplies are ordered — and the initial deposit is paid.
—Survive the dust, noise and workers. With proper supervision, the disruption can be kept to a minimum. Make sure materials are ordered and on the way before beginning the tear-out. Clear a space in the garage for workers' tools and supplies and items removed from the old kitchen. And communicate regularly with the designer/installer.
The August issue of Consumer Reports identifies these four rules for a successful kitchen remodel:
Don't rush. There are many kitchen products that combine value, performance and good looks. Take time to meet with professionals, browse the Internet and visit showrooms and home centers. Haste can be costly. Changing your mind after the project is started typically adds about $1,500 to the cost of a kitchen project.
Size matters. In addition to being expensive, oversized kitchens can be exhausting to work in and keep tidy. A more compact kitchen often functions better. The National Kitchen & Bath Association website, nkba.org, provides guidelines for optimal space between appliances, cabinets and islands.
Beware of budget busters. Leave a 10 percent to 15 percent cushion for surprises, such as unexpected structural repairs. Avoid settling for a cheap option, thinking someday you will replace it with something you really want. Chances are that will never happen.
Get it in writing. When using a professional for a remodel, the written contract should list each phase of the project; every product, including the model number; and copies of each contractor's license, and workers compensation and liability insurance to confirm they are current. Call references and, if possible, visit them.
Sunday, October 3, 2010
Mortgages Can Help, Rather than Hinder, Finances
While most financial-savvy consumers do their best to avoid debt, one debt that is unavoidable to many families is a mortgage. Because many of us feel more in control of our home and expenses without a mortgage, a common question is whether to pay it off as quickly as possible.
The answer depends on each person's financial situation. A mortgage can actually be a blessing to some.
For example, mortgage interest is tax-deductible. This deduction saves taxpayers about $103 billion a year, according to the U.S. Treasury. The benefit is less to owners of low- to moderate-valued homes who may not have much interest or enough to claim it by itemizing deductions. But for families with a higher net worth, it allows a tax savings and may encourage them to buy larger homes.
With tax brackets for the wealthy rising next year, this tax break becomes more valuable. When the break is included, a 6 percent mortgage could have a rate closer to 4 percent in reality. Calculate your mortgage's effective rate by subtracting your tax rate from 100 and multiplying that number by the interest rate. For example, a 28 percent tax bracket with a 6 percent mortgage would result in (.06 x 72) to equal the equivalent of a 4.32 percent mortgage rate after considering tax savings if itemized. That helps the interest look less daunting.
In addition, with the possibility of investing with a goal of a 5 or 6 percent return, instead of putting that money into a mortgage the homeowner could get a return higher than the effective rate, which could help grow net worth. On the other hand, if the effective rate is higher, it may make sense to pay down the mortgage.
Another situation that makes paying off a mortgage attractive is for someone at risk of bankruptcy. Many states offer protection from creditors seizing a home to pay debts. If a home is paid in full, it is more likely the owner could stay in it if he goes broke, providing he can pay for the upkeep.
Money taken out for a mortgage also could reduce net worth later in life. The potential for higher investment returns are gone; that money will not be able to grow if investments grow over the long term. Not to mention having too much invested in a house. That could be detrimental at retirement. While we can get a loan for a house, there are no loans to finance retirement.
The answer depends on each person's financial situation. A mortgage can actually be a blessing to some.
For example, mortgage interest is tax-deductible. This deduction saves taxpayers about $103 billion a year, according to the U.S. Treasury. The benefit is less to owners of low- to moderate-valued homes who may not have much interest or enough to claim it by itemizing deductions. But for families with a higher net worth, it allows a tax savings and may encourage them to buy larger homes.
With tax brackets for the wealthy rising next year, this tax break becomes more valuable. When the break is included, a 6 percent mortgage could have a rate closer to 4 percent in reality. Calculate your mortgage's effective rate by subtracting your tax rate from 100 and multiplying that number by the interest rate. For example, a 28 percent tax bracket with a 6 percent mortgage would result in (.06 x 72) to equal the equivalent of a 4.32 percent mortgage rate after considering tax savings if itemized. That helps the interest look less daunting.
In addition, with the possibility of investing with a goal of a 5 or 6 percent return, instead of putting that money into a mortgage the homeowner could get a return higher than the effective rate, which could help grow net worth. On the other hand, if the effective rate is higher, it may make sense to pay down the mortgage.
Another situation that makes paying off a mortgage attractive is for someone at risk of bankruptcy. Many states offer protection from creditors seizing a home to pay debts. If a home is paid in full, it is more likely the owner could stay in it if he goes broke, providing he can pay for the upkeep.
Money taken out for a mortgage also could reduce net worth later in life. The potential for higher investment returns are gone; that money will not be able to grow if investments grow over the long term. Not to mention having too much invested in a house. That could be detrimental at retirement. While we can get a loan for a house, there are no loans to finance retirement.
Friday, October 1, 2010
10 Tips to Conserve Water
Here are some tips from Pennsylvania American Water on how you can conserve water and reduce the environmental impact of water consumption both indoors and outside the home:
1. Water your lawn only when it needs it. An easy test to tell if your lawn needs water is to simply walk across the grass. If you leave footprints, it's time to water. (An added benefit of watering less often is that fewer, deep-soaking waterings encourage deep root growth and stronger turf.)
2. Water in the early morning. As much as 30 percent of water can be lost to evaporation by watering during midday.
3. Set your lawn mower one notch higher to make your lawn more drought-tolerant.
4. Use drip irrigation hoses to water plants, and water in the early morning or evening.
5. Use a broom instead of a hose to clean your sidewalk, driveway, or patio.
6. Forego the hose and wash your car with a bucket and sponge instead. According to EPA WaterSense, a hose left running can waste as much as six gallons per minute while a bucket and sponge uses only a few gallons to do the job.
7. Keep a bottle of cold tap water in the refrigerator. You'll avoid the cost and environmental impact of bottled water and you'll have cold water available in the summer without running the faucet.
8. Run dishwashers and clothes washers only when they are full. If you have a water-saver cycle, use it.
9. Adjust the water level of your clothes washer, so that it matches your load size.
10. Regularly check your toilet, faucets and pipes for leaks and have them fixed promptly. An easy test for toilet leaks from EPA WaterSense: Place a drop of food coloring in the tank. If the color tints the water in the bowl without flushing, there's a leak. Check your water meter before and after a two-hour period when no water is being used. If the meter changes at all, you probably have a leak.
1. Water your lawn only when it needs it. An easy test to tell if your lawn needs water is to simply walk across the grass. If you leave footprints, it's time to water. (An added benefit of watering less often is that fewer, deep-soaking waterings encourage deep root growth and stronger turf.)
2. Water in the early morning. As much as 30 percent of water can be lost to evaporation by watering during midday.
3. Set your lawn mower one notch higher to make your lawn more drought-tolerant.
4. Use drip irrigation hoses to water plants, and water in the early morning or evening.
5. Use a broom instead of a hose to clean your sidewalk, driveway, or patio.
6. Forego the hose and wash your car with a bucket and sponge instead. According to EPA WaterSense, a hose left running can waste as much as six gallons per minute while a bucket and sponge uses only a few gallons to do the job.
7. Keep a bottle of cold tap water in the refrigerator. You'll avoid the cost and environmental impact of bottled water and you'll have cold water available in the summer without running the faucet.
8. Run dishwashers and clothes washers only when they are full. If you have a water-saver cycle, use it.
9. Adjust the water level of your clothes washer, so that it matches your load size.
10. Regularly check your toilet, faucets and pipes for leaks and have them fixed promptly. An easy test for toilet leaks from EPA WaterSense: Place a drop of food coloring in the tank. If the color tints the water in the bowl without flushing, there's a leak. Check your water meter before and after a two-hour period when no water is being used. If the meter changes at all, you probably have a leak.
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