TAX REFORM BILL EFFECTS ON REAL ESTATE PAGE 6 | GIVE IT YOUR BEST OFFER PAGE 9 SUNDAY, APRIL 1, 2018 | TIMES RECORD
2018
Home Buyer's Guide
THE SECRET TO AGENT SUCCESS PAGE 16 | TIPS FOR A STRESS-FREE MOVE PAGE 18
2
|
Sunday, April 1, 2018
|
Home Buyer’s Guide
Is it a good time to buy? By Melissa Erickson More Content Now
W
ith interest rates on the rise and expected to climb higher, home buyers may be rushing to invest in a property before it gets more expensive to borrow money. That begs the question: Is now a good time to buy a house? “With so many variables to consider, there are no cookiecutter answers,” said Robert Solomon, clinical professor of law at University of California Irvine. “There is a housing shortage in many metropolitan areas and, when combined with foreign investment, housing is overpriced in many areas. The corollary is that there are other
For some, yes. But here’s what to watch for areas with higher vacancy rates and when combined with low interest rates, housing may be a bargain.” Housing affordability is becoming a major concern in many markets, said Murat Arik, director and assistant professor of management in the Business and Economic Research Center, Jones College of Business, Middle Tennessee State University. “If and when the Federal Reserve increases the interest rate, that will add an additional layer of burden for the potential home buyers,” Arik said. “Although there are significant regional variations in the housing market and what is unfolding in certain parts of the economy, the strong economic
fundamentals suggest that it may still be a good time to buy.” There’s really no straightforward answer. “On one hand, current mortgage interest rates suggest it is still a good time to buy. On the other hand, looking at the broader market, there are several discouraging factors for potential buyers,” Arik said. Negatively affecting the home-buying decision is that home prices are growing faster than wages, Arik said. Additionally, home prices will continue to grow even faster because of several pressures, including low housing inventory and increased demand from various population segments, Arik said. Political factors unfolding in
the country may also impact overall sentiment across the economy on housing-related activities, Arik said. These include “increasing market volatility, increasing lumber prices, increasing tariffs on steel and aluminum, impact of tax overhaul and potential trade war over the expected tariffs on steel and aluminum,” he said. Indicators to watch At least four aspects of the economy are worth watching when considering whether to buy a home, said Donald Haurin, professor emeritus in the Department of Economics at Ohio State University. They include: 1. The Federal Reserve’s
and experts’ comments on the expected changes in mortgage interest rates or the 10-year bond. Do they predict it will rise by a percentage point or more? 2. Indices of current house price changes. Are they remaining strong? If yes, investment value of house remains high. 3. The average time on market of local houses. If it is rising substantially, the local housing market is likely slowing. This suggests that house prices will not increase as much as in the past two years, reducing the investment value of ownership. 4. Indicators of the health of the local economy, such as the local unemployment rate. A strong economy suggests the housing market will remain strong.
Home Buyer’s Guide | Sunday, April 1, 2018 | 3
Monthly home expenses that rack up fast By Melissa Erickson More Content Now
A
fter saving for the down payment and finding the perfect home, it’s time to crunch the numbers. Many new buyers don’t realize the hidden costs of homeownership. The average U.S. homeowner spends about $2,000 per year on maintenance services, according to a new Bankrate.com report. Sixty-three percent of respondents engaged at least one recurring maintenance provider, including 35 percent who have signed up for two or more. The survey asked about eight programs: housekeeping, homeowners’ association dues, landscaping, security systems, pool care, snow removal, septic service, and trash and recycling collection. The highest monthly costs were for housekeeping, $285; homeowners’ association dues, $210; landscaping, $144; and security systems, $130. “These figures illustrate the hidden costs of homeownership, and it’s important to note they don’t include repairs such as a broken refrigerator, washing machine or
air conditioner,” said Bankrate.com analyst Taylor Tepper. “These are just ongoing, routine tasks like keeping your house and yard clean. Make sure to factor these costs into your new budget when you buy a house. Or do them yourself to save thousands of dollars each year.” These expenses are not a surprise, but they do add up faster than many anticipate. “People know if they want a housekeeper they’re going to have to pay for that service. But homeowners may be surprised at how quickly these costs add up, especially with a tight budget,” Tepper said. Among the surveyed options, private trash/recycling programs are the most common, followed by landscaping and homeowners’ association dues. Use of most of these services tends to increase with age and income. “The key is to be mindful of your spending,” Tepper said. “Each of these expenses may have merit, but you should only consider them if you’ve accounted for them in your budget. Likewise, if times get tough, maintenance services could be an area to cut.”
4
|
Sunday, April 1, 2018
|
Home Buyer’s Guide
Mortgage Loan Q & A What is the required minimum down payment? Conv: 5% of the purchase price, FHA: 3.5% of the purchase price, RD: 0%, VA: 0% What other costs are associated with my loan besides the down payment? All loans have closing costs and pre-paids (taxes, insurance, and interest). You will pay these yourself unless your contract indicates the seller is to pay a portion, or all. The costs can vary depending on multiple factors. What income can be used for qualifying income? Income earned through a W2 position, self-employed job, or non-taxable verifiable income may be used. Self-employed income must be verified typically with the last two years’ Federal Tax Returns. Non-taxable income, social security, disability, child support, etc., can be used as qualifying income. Cash or child support of a child 15 or older is not considered as qualifying income. I have been saving cash at home. Can that be used for our down payment and closing costs? Some cash is allowed. How much depends on the loan type, purchase price of the home, and monthly qualifying income. Guidelines are very specific. Please give us a call. What documents or information will be required for my loan? Typical documents: Most recent two years’ work and residence history, two years’ Federal Tax returns and W2s, two months’ bank statements, and one month of pay stubs. Documents needed, if applicable: Most recent two years’ business tax returns & year to date profit and loss (Self-Employed buyers), Copy of DD214 (Veteran buyers), Divorce decree, and proof of child support.
Important Information to Know Prior to & While Applying a for a Loan The business of getting a mortgage loan is guideline driven. These guidelines are in place for very specific reasons and developed by entities like Fannie Mae, Freddie Mac, FHA, RD, and VA. With the experience and expertise of a First Financial loan officer, you will be able to navigate the process with ease. Below are potential pitfalls that should be avoided and tips to make your experience as smooth as possible: 1. Do not go shopping! It’s very important that your financial situation remain the same throughout the whole loan process. Also, any inquires on your current credit report that resulted in a new open account must be addressed. 2. Notify us if you plan to transfer/shift money throughout different accounts. There are ways of documenting these transactions that are required by mortgage guidelines. 3. We need documentation (other than payroll, income tax refunds, etc.) of any large deposits and evidence of verified funds on the checks written for earnest money. 4. Talk to us about any gift money/ 401K funds/ sale of personal property you may be receiving. There are very specific ways to document these funds in conjunction with a mortgage loan. The documentation is different depending on the loan type. Give us a call. 5. Please consider who you will be using for homeowner’s insurance as early as possible. We need to know the yearly premium of your policy and your agent’s contact information prior to sending your file to underwriting.
Home Buyer’s Guide
|
Sunday, April 1, 2018
|
Specializing in Federal Housing Administration (FHA) Financing Since 1935 Conventional, VA, FHA, and Rural Development Loans available. USE THIS CHART TO ESTIMATE YOUR MONTHLY MORTGAGE PAYMENT. Interest Rate 2.500% 2.625% 2.750% 2.875% 3.000% 3.125% 3.250% 3.500% 3.750% 4.000% 4.125% 4.250% 4.375% 4.500% 5.000%
Repayment Term per $1,000 15 YEARS 6.67 6.73 6.79 6.85 6.91 6.97 7.03 7.15 7.27 7.40 7.46 7.52 7.59 7.65 7.91
20 YEARS 5.30 5.36 5.42 5.48 5.55 5.61 5.67 5.80 5.93 6.06 6.13 6.19 6.26 6.33 6.60
30 YEARS 3.95 4.02 4.08 4.15 4.22 4.28 4.35 4.49 4.63 4.77 4.85 4.92 4.99 5.07 5.37
Determine your loan amount and divide that amount by 1000. Multiply that product by the number that corresponds with the interest rate and repayment term you have chosen. The ďŹ nal product will by your monthly principal and interest payment.
EXAMPLE :
(Mortgage Credit CertiďŹ cate)
YOU COULD EARN UP TO $2,000 TAX CREDIT FOR A PRIMARY HOME PURCHASE. (DOLLAR FOR DOLLAR CREDIT)
MCC QUALIFICATIONS
(Please call for additional details or prequaliďŹ cation.)
t Obtain a ďŹ xed rate Conventional, FHA, VA or RD loan for a purchase of a PRIMARY residence. t Purchase price must not exceed $250,000. t ALL types of income for ALL persons over the age of 18 who will be living in the residence must be reported. t The yearly tax credit can be received as long as the owner lives in the home, retains a mortgage, and has a tax liability. t Each year the tax credit is recalculated on the remaining principal balance.
SEBASTIAN COUNTY
t Buyers may NOT have owned a primary home in the previous 3 years unless they are a Veteran. Income Limits #of People Living in Household 1-2
Total Household Income $59,496
3-4
$68,420
CRAWFORD COUNTY
MPBO t JOUFSFTU SBUF 30 year repayment term 100,000/1,000=100 100x4.63=$463.00* *NOTE: Taxes, Insurance and Mortgage Insurance
(if applicable) are not included in above calculation.
t Buyers MAY have previously owned or currently own a home. Income Limits - Income waivers may be requested #of People Living in Household 1-2
Total Household Income $63,840
3-4
$74,480
** PLEASE CONSULT AN ACCOUNTANT FOR ADDITIONAL TAX DETAILS.
FIRST FINANCIAL MORTGAGE IS PROUD TO BE THE #1 MCC LENDER IN ARKANSAS SINCE 2011. ETHAN ADAMSON NMLS #924274 479-459-3719
SHERRY HOLDEN NMLS #445259 479-806-7200
TRACI WILHELM NMLS #733614 479-461-3799
3401 Rogers Ave., Suite A | Fort Smith, AR 72903 | (479) 782-9300 | www.ffb1.com
5
6
|
Sunday, April 1, 2018
|
Home Buyer’s Guide
Tax reform bill effects on real estate By Melissa Erickson More Content Now
I
t may take a while before the implications of The Tax Cuts and Jobs Act, enacted in December 2017, are entirely clear, but it will affect the real estate market. “Given the increase in the standard deduction and the decrease in the amount of debt covered by the mortgage interest deduction, there will be fewer home buyers moving forward. Expect the housing market to be soft for the next few years as a result,” said Gabriel Mathy, assistant professor in the Department of Economics at American University, Washington, D.C. The lower mortgage interest deduction may keep some buyers from purchasing a new home. “Anyone borrowing a large amount to buy a home will pay more in taxes and this will discourage some buyers, who will rent instead,” Mathy said. High-end market hit The new tax bill lowers the amount of interest on mortgage debt, and that will affect home buyers in more-expensive markets, said Joshua Zimmelman, president of Westwood Tax & Consulting, Rockville Center, New York. “In the past, taxpayers could deduct interest on mortgage loans up to $1 million. In the new tax plan, current homeowners can keep deducting up to $1 million, but new homeowners can only deduct up to $750,000 on homes,” Zimmelman said. In particular buyers will take a hit in certain luxury markets like Manhattan and San Francisco, where the median home price is well over $750,000, said Meisa Bonelli, senior tax professional with Millennial Tax, a provider of preparation
and education for solopreneurs, freelancers and microbusinesses in New York City. “Forty percent of American homeowners, if they had to sell their homes tomorrow, would have to consider how their prospective buyers would be affected by the new mortgage interest deduction cap,” Bonelli said. “The best thing may be for sellers to require larger down payments up front to weed out buyers that may be factoring in the mortgage interest deduction per a home’s sale price.” SALT cap of $10,000 The new tax plan caps state and local tax deductions at $10,000, plus the income or sales tax. “The state and local property
tax cap may stop people from moving to higher-tax areas. It’s possible this could make the value of homes in those areas go down, while increasing the prices of homes in moreaffordable areas,” Zimmelman said. Additionally, in areas with local and state taxes that are higher than average, “home values could start to decline as a result of the new tax plan. ... After some time, the prices of homes in more-affordable areas could actually increase as a result,” Zimmelman said. Sellers may hold off The new tax bill also affects sellers because it eliminates the moving expenses deduction for most taxpayers.
“After 2018, only members of the armed forces on active duty can deduct moving expenses,” Zimmelman said. It will also affect people who are planning to sell a property as retirement income. “For people that have factored in selling their homes as part of their retirement portfolio, they should give themselves more time to sell their homes if the value of their home is 5 to 10 percent above $750,000. Why? Because most buyers today don’t put down the traditional 20 percent down payment to obtain their mortgage,” Bonelli said. Equity loans more expensive Another change is that home
equity loans are no longer deductible. “In the past, taxpayers could deduct up to $100,000 in interest paid on home equity debt. The new tax law eliminates this deduction unless the home equity line was used to purchase another home or for home renovations,” Zimmelman said. “That may turn buyers off to fixer-upper properties,” Bonelli said. “Home equity loans had more advantage than 203k (FHA) loans in the past because they were cheaper to originate. Now, it may make sense for buyers to look for rehabilitation properties if they can get 203k financing because if the mortgage is under $750,000, the interest will be tax-deductible.”
Home Buyer’s Guide
A
t Assurance Realty in Fort Smith, the philosophy is simple – clients come first. This simple concept has pushed the real estate company to work hard to make sure their clients find the home of their dreams, and in return, it has left clients so satisfied, they voted the company the best real estate company in the area in the annual Best of the Best competition through the Times Record three years in a row. The company and its Realtors understand buying or selling a home is more than just a transaction: It’s a life-changing
Clients Come First
experience, the company’s website states. “That’s why our team of highly seasoned real estate professionals is dedicated to providing exceptional, personalized service for all of our clients. We take great pride in the relationships we build and always work relentlessly on the client’s behalf to help them achieve their real estate goals,” said Adam Spradlin, principal broker at Assurance Realty, when asked about the company, adding that the company strives to lead the field, be it in research, innovation or consumer education. Today’s buyers and sellers need trusted
resources, he added, and that is the kind of agents Assurance offers. As principal broker, I see my role as one who supports my agents to a whole new level. “My goal is to enable our team to succeed and excel in every aspect real estate related for our clients. Our clients see this throughout their experience with Assurance Realty, and I believe that is why so many of our great clients choose us as the No. 1 real estate company,” Spradlin said. Some of the key aspects of the company’s mission are to be in constant
|
Sunday, April 1, 2018
|
communication with clients, keeping them informed throughout the buying and selling process, letting them know they have someone on their side throughout their real estate experience. “We believe that if you’re not left with an amazing experience, we haven’t done our job,” Spradlin said. “We don’t measure success through achievements or awards, but through the satisfaction of our clients.” The real estate company has made its goal to continue to excel and grow by providing next level skills and services to all clients, Spradlin added.
FS-0001095090-01
7
8
|
Sunday, April 1, 2018
|
Home Buyer’s Guide
Interest rates: Experts say money will get more expensive to borrow But it won’t put real estate out of reach By Melissa Erickson More Content Now
S
peculation abounds about interest rates. When will the Federal Reserve raise rates again? How quickly and how often will they rise? One thing experts agree on: “We know that interest rates are going to continue to rise,” said Alessandro Rebucci, associate professor at the Carey Business School at John Hopkins University and an expert in international finance, applied macroeconomics and financial crises. “The recent tax cut means much higher government borrowing, household consumption and business investment, so also higher wages and inflation. The stock
market will continue to adjust downward toward more realistic valuations or turn bear if the Fed fails to deliver on its balancing act. Volatility is back with a vengeance and here to stay,” Rebucci said. James P. Gaines, chief economist at the Real Estate Center at Texas A&M University, agreed. “We’re expecting to see movement. The Fed has said it’s going to raise rates with between one and four increases. Assume it’s three — about 75 basis points. With that, long-term rates will adjust upwards to some extent,” Gaines said. But, rising interest rates probably won’t have much of an impact on the housing market this year,
Gaines said. “People who are on the fence about buying a home will see prices go up and interest rates go up and they may think, ‘I might as well buy now,’” Gaines said. “The kicker is that inventory is low. Everything works in a circle.” Hoping for a soft landing “The housing market will naturally cool down in this process, hopefully landing softly rather than crashing,” Rebucci said. “For many American households, the higher cost of mortgage financing, once higher interest rates have fully passed through, combined with more limited deductibility of interest
payments will outpace any tax relief approved late last year. This is a net negative for the housing market. “There are also pockets of oversupply in many metropolitan areas, with some uncertainty as to whether the maturing millenials will continue to boost demand for condos in more central areas,” Rebucci said. Buyers may downgrade Interest rates are not expected to spike, Gaines said. During the last boom the mortgage rate was 6 percent. Now we’re in the 4 percent range. “By and large it will not make that much of an impact on the
housing market. ... The home buyer who is looking at a $300,000 home might buy a $275,000 or $250,000 home, but they will still buy. This might give them the push they need to buy now,” Gaines said. Interest rates on the move also affect home builders, who “get nervous when rates go up,” Gaines said. Because rising rates make it more difficult for buyers to afford the home they want, builders will try to create homes in more affordable price ranges, Gaines said. In the long run While the Federal Reserve controls shortterm rates, the market
determines the long term. “The imbalance between demand and supply of longer-dated U.S. government paper does not bode well for longer-term bond prices or the stability of their yields to which our mortgage market is anchored,” Rebucci said. “Because of the tax cuts, the Treasury needs to issue massive amounts of new debt. The Fed would like to stop buying, while foreigners, concerned by the widening trade deficit, are watching rather than shopping in the bond market. The odds of a recession — and a serious housing market correction — within the next 24 months are definitely higher than they were before the tax cuts.”
Home Buyer’s Guide
|
Give it your best offer R
A competent real estate agent will know that a property will attract quick buyer interest. In some cases, a listing agent will even inform a buyer’s agent that there are other offers coming in. Moreover, when there’s a flurry of interest, “the selling agent can give you a deadline, like Tuesday at noon, to submit your ‘best and final offer,’” says Mark Trompeter, of Weichert Realtors, Jersey City, N.J.” “This term doesn’t mean anything legally,” he adds, because there might be further negotiations. Still, in these instances, a buyer will put forth an offer with the highest price
9
Indeed, real estate investors looking to rent out a home buy most frequently in the $100,000 to $300,000 range, notes Daren Blomquist, senior vice president, ATTOM Data Solutions. The best a first-timer can do to compete is to convey the certainty of his financing, and perhaps show he’s the only who will truly love the home.
CTW Features
1. Size up the competition
|
Smart strategies to buy in a tight market
By Marilyn Kennedy Melia
emember playing musical chairs? For many eager first-time buyers, house hunting will remind them of that childhood game where everyone was scrambling to secure a place, but someone invariably lost out. With a limited supply of lower or moderately priced homes in many areas, multiple buyers are often competing for the same home. “When a property looks good and is priced well, if it goes on the market on Friday, there will be multiple offers by Monday,” says Jim Fite, president, Century 21, Judge Fite in Dallas-Ft. Worth. But if a buyer misses out on one home — or even two, three, or more — all is not lost. Determined, flexible and creative buyers can still land a home to call their own, say agents. Here, a look at strategies that could help first-timers find their way home:
Sunday, April 1, 2018
3. Sweeten other provisions
he’s willing or able to pay, with the most attractive terms [see below] he can promise. In other scenarios, when to submit your best offer is a judgment call. “Say a home goes on the market on Wednesday and there’s an open house on the weekend,” Trompeter says. “A client might be excited and want to offer right away, but I might say, ‘Let’s wait until the open house to see what the interest is.’ In the meantime, I will be calling the listing agent to see what’s happening and if we shouldn’t wait.” 2. Show you’re good for the money Price, of course, is a paramount concern to sellers. But sellers must also weigh
whether a particular buyer will actually receive the mortgage he needs to actually purchase and pay the promised price. Here, if a buyer exercises a little extra diligence working with a lender, he can reassure the home seller his financing is sound – and perhaps even beat out another, higher offer. At a minimum, buyers should be “pre-approved,” not just “pre-qualified.” The latter means that a buyer lets a lender pull his credit history as well as gather information on his salary and job history, and savings. Expect every viable buyer to be pre-qualified. Some lenders may go farther, however, and “pre-underwrite” the loan, says Gibran Nicholas, CEO of the CMPS Institute, which certifies mortgage bankers and brokers.
By “pre-underwriting” a lender works with a buyer to secure all the information that can be supplied before there’s a specific home the buyer has put forth a purchase offer on, Nicholas says. For instance, when documents like bank statements showing a borrower built his savings for a down payment over a period of months, and his past few income tax returns can speed up processing once a home is selected. Moreover, agents say some lenders will agree to call the listing agent to assure them that they have carefully reviewed the buyer’s mortgage application, and anticipate no problems. A dose of realism, however: Know that despite your best efforts, you could lose out to a buyer who doesn’t need financing, but is paying cash.
Buying a home is a leap into the unknown. No one, particularly first-timers who may be on a budget, wants to deal with a broken water pipe or dying furnace. That’s why it’s standard for a purchase offer to include an inspection contingency, whereby the buyer hires a professional to comb top to bottom, noting any and all defects. It’s risky to not include this contingency. “When your are buying a home there is often earnest money or due diligence fees,” notes Darrell Hess, a Redfin agent in Asheville, N.C., and that money could be lost if you submit a contract without an inspection contingency, but pull out when serious flaws become apparent. However, Trumpeter says a buyer might stipulate that he’s willing to absorb the costs of certain projected repairs. Moreover, a first-time buyer who has a month-to-month rental or a flexible landlord has an advantage over other buyers who must sell a place before closing the deal. Stipulating that you’re able to close quickly, or conversely, wait until the seller wants to move, could move your offer to the top.
10
|
Sunday, April 1, 2018
|
Home Buyer’s Guide
Finding your right hand(y) man or woman
By Carley Lintz CTW Features
D
isasters always happen at the most inopportune moments; a pipe bursts while you’re on vacation or the heat goes out in the middle of winter. Unfortunately, many of us wait until after something goes wrong to start looking for a contractor, which means we’re stuck with whoever is available at that moment — no matter their price, reputation or workmanship. That’s why it’s so important to be prepared with the number of a contractor you can trust on hand to ensure the problem is fixed promptly and properly. Every homeowner should have a go-to HVAC provider, electrician, plumber, roofer and pest control company ready in case of an emergency. Here are a few expert tips for finding the best service
providers in your areas: 1. Ask for recommendations Start by asking family, friends, neighbors, your real estate agent and even the previous homeowners about the companies they use. Websites like Zaarly.com and Angie’s List can also be great resources for finding reputable service providers. 2. Do your research — thoroughly Your home is a big investment, so you shouldn’t trust its maintenance to just anyone. When researching potential contractors, go beyond a cursory perusal of their website. Check to make sure the business is properly licensed and read reviews from past customers. Online databases like the Better Business Bureau, local Chamber of Commerce
and trade associations can offer a wealth of information to homeowners. 3. Ask the right questions Before you put any companies on speed dial, talk to a real person — either in person or over the phone — for an interview. Here are some key questions to ask: • How long have you been in business? • Do you have insurance, including worker’s comp? • Can you quote me ahead of a project or repair? • Can you provide a list of references? • What does your warranty entail? • What sets you apart from other similar businesses? Also, be on the lookout for red flags, like a contractor that’s hasn’t been in business long, offers vague answers or takes forever to return your call.
How to set a realistic home budget By Carley Lintz CTW Features
T
alking about money isn’t fun. When searching for your first house, though, it’s crucial to set a realistic budget lest you end up with more home than you can actually afford. “To figure out what you can afford when you’re saving for a home, a good rule of thumb is to ask yourself, ‘How much should I borrow?’ instead of, ‘How much could I borrow?’ This approach focuses on the amount that comfortably fits your budget,” advises Kathy Cummings, Senior Vice President
of Homeownership Solutions, Bank of America. To figure out a manageable monthly mortgage payment, Cummings recommends using an online affordability calculator, or, taking your monthly income before taxes and multiplying it by 28 percent. This gives you a rough estimate of how much you can afford to pay each month, including taxes and insurance. When building your home budget, don’t forget to figure in extra costs. These include onetime expenses like closing costs, home inspections and moving fees as well as recurring payments like taxes and mortgage
insurance. Buyers should also be prepared for post-move in costs, such as new furnishings and home maintenance or repair costs. There are also resources available to help you set — and stick to — a smart home-buying budget. “Seek the help of homebuyer education programs and credit counselor for assistance,” advises Cerita Battles, SVP and Head of Retail Diverse Segments for Wells Fargo Home Mortgage. “These resources can support aspiring homeowners on topics like saving for a down payment, budgeting and improving credit score and can be available online, by phone and in person.”
Home Buyer’s Guide
|
Sunday, April 1, 2018
|
11
Planning ahead can help home-buying process BancorpSouth loan officer provides tips By Carole Medlock Special to the Times Record
A
local banking official says that advance planning can provide both guidance and clarity when navigating the home buying process. Stacy Johnson, a mortgage loan officer with BancorpSouth, NMLS #484982, said with so many options and opportunities for potential home buyers, a few precursory steps can help simplify the process. Johnson said above all, potential buyers — whether home shopping with a realtor or as an individual — should take the time to pre-qualify for a loan. Applications for pre-qualification can be filled out online, or customers can call or visit a loan officer to go through the process. A buyer’s income to debt ratio is analyzed in addition to their credit score during the process, which then allows a loan officer to let the buyer
know how much money they will have to work with in the buying process. Johnson said just because a buyer qualifies for a certain amount of money, does not always mean that they want to spend it. So, a buyer should also have an idea of what they feel comfortable spending for a house payment each month. Once an amount is determined, Johnson said officials will work to discover what kind of loan best fits the needs of the client. Loans including conventional, FHA, VA and Rural Development loans are among those that borrowers can pursue based on their situation. Different loans can have different advantages for the borrower, Johnson said, so it is good for a buyer to work with someone who can assess which loan would meet their needs. “I love talking with the people and finding out what’s the best for them,” she said.
Once a buyer is pre-qualified they are issued a letter of pre-qualification, Johnson said, which they can present to a realtor. Many realtors today are looking for that pre-qualification letter before they are ready to show a prospective buyer a variety of properties, she said. Once a buyer finds a home they want to purchase, the process to buy the property takes about 30 days, Johnson said. A mortgage team works to verify everything on the borrower’s application, an appraisal of the property is obtained, the borrower’s file is passed along to an underwriter that again verifies all of the information, and then the bank and the client can close on the loan. A title company is used to finalize the paperwork and close the transaction. Johnson said it is important for a buyer to understand that the loan See JOHNSON, 12
We’ve Got the Right Mortgage for Right Where You Are in Life. If you’re ready to finance a home, but you’re not sure which mortgage is best for you, BancorpSouth has a number of mortgage loan programs suited to fit the needs of every homebuyer. So whether you are buying your first home, building your dream house or looking to refinance the one you own, let our lenders at BancorpSouth Mortgage help find a plan that’s just right for you.
Ciela Edwards
Stacy Johnson
Grissa Schmitz
Sandra Barron
5800 Hwy 71 S | Fort Smith (479) 649-1011 | NMLS #484988 ciela.edwards@bxs.com
7000 Rogers Ave | Fort Smith (479) 478-4426 | NMLS #484982 stacy.johnson@bxs.com
1222 Rogers Ave | Fort Smith (479) 785-8332 | NMLS #1617157 grissa.schmitz@bxs.com
1222 Rogers Ave | Fort Smith (479) 785-8324 | NMLS #458059 sandra.barron@bxs.com
Mortgages are subject to approval. Interest rates are subject to change without notice & dependent on credit score. This is not a commitment to lend or rate guarantee. OB9347
Stacy Johnson, a loan officer with BancorpSouth, 7000 Rogers Ave., in Fort Smith, talks about the home buying process March 13, 2018. [BRIAN D. SANDERFORD/TIMES RECORD]
12
|
Sunday, April 1, 2018
|
Home Buyer’s Guide
First-timer’s right loan
Find the best loan to finance your first home with this quick guide from mortgage experts By Carley Lintz CTW Features
Buying a home for the first time is an exciting endeavor, but it’s also a huge financial decision. The median home value was $205,100 as of November 2017 according to Zillow. Unfortunately, most of us don’t have that kind of cash on hand, so that’s where home loans come in. The process of choosing, applying for and obtaining a mortgage can be overwhelming, though, especially for first-time homebuyers. It’s easy to get lost in the paperwork, financial terminology and types of loans, which is why it’s important to have an experienced professional to guide you to the best loan for you. “There are an array of loan programs that exist and can fit the various needs and desires of homebuyers. Every homebuyer situation is unique and there is no one size fits all when it comes to homeownership financing. A lender can help you explore mortgage options to help you make the best financing decision for your situation,” explains Cerita Battles, SVP and Head of Retail Diverse Segments for Wells Fargo Home Mortgage. Before you decide on a loan, you should first identify your goals and determine how much home your budget can handle. “Knowing where homeownership fits into your larger financial plan is important. Reflect on where your life is headed and what you want to accomplish along the way,” says Kathy Cummings, Senior Vice President of Homeownership Solutions, Bank of America. She recommends asking yourself: • Would I need to make changes in my budget to buy a home? • Will buying a home mean stretching to my financial limits? • Would owning allow me to
maintain my other savings goals and be prepared for potential home emergencies, like a new roof? • What’s more important to me: the opportunity to build equity over time or have stable housing payments? The types of loans available to you will also depend on a number of factors, such as your credit profile, down payment amounts and income. Here’s a breakdown of some of the most popular types of home mortgages available to first-time homebuyers: 1. Fixed-Rate Mortgages These types of mortgages have a set interest rate for the entire life of the life, typically 15 or 30 years, which means your monthly principal and interest payments will always be the same. “This offers you consistency that can help make it easier for you to set a budget,” says Cummings. This type of loan is great if: • You plan on owning your home for an extended time period (7 or more years). • Interest rates are likely to rise
in the near future and you want 3. Government Loans to lock down the current rate. • You prefer the stability of In addition to private loans, a fixed principal and interest there are also governmentpayment. backed mortgages available, such as a FHA loan or a VA loan. 2. Adjustable-Rate A FHA loan is a mortgage Mortgages (ARMs) insured by the Federal Housing Administration. They usually ARMs are loans with inter- offer competitive interest rates, est rates that adjust at a specific smaller down payments and time and frequency (once a year, lower closing costs than many once every three years, etc.), so private mortgages. These loans the amount you pay changes are especially popular amongst depending on the market. Typi- first-time homebuyers because, cally, they provide a lower initial if you have a credit score about rate than fixed loans and after 580, you may qualify for a down the first period is over, the rate payment as low as 3.5 percent of will adjust to the market trends. the purchase price. However, This type of mortgage is gener- you must also pay mortgage ally considered riskier because insurance premiums, which proyour future payments are not tect the lender if you default. guaranteed. If you are an active-duty miliYou may choose this type of tary member, veteran or surviving loan if: spouse, you may have access for a • You want to take advantage loan through the U.S. Department of lower initial payments to buy of Veterans Affairs. Since the VA a more expensive home. guarantees part of the loan, these • You believe the market rates loans usually feature competiwill decrease in the future. tive interest rates and no down • You expect to sell your home payments. You also don’t need in a set time frame and therefore to meet a minimum credit score will move before you experience and aren’t required to pay private an interest rate change. mortgage insurance.
JOHNSON From Page 11
process can be lengthy and that they will have to be involved with the lender to provide documentation, but the end result is worth the effort. “I love closing because I love seeing (the buyer) excited about their new home. That’s an exciting time,” Johnson said. Johnson said mortgage loan officers can also help borrowers look into special financing for low to moderate income families or if the home being purchased is in a low to moderate income area. Benefits including 100 percent financing may be made available for home buyers that meet the criteria. In addition, Johnson said first time home buyers — defined as a buyer who has not owned a home in the past three years — can qualify for grant funds, down payment assistance, or closing cost assistance. Johnson advised that even potential home buyers who may not think they are good candidates for a home loan should make application and go through the process. “Call and talk to a mortgage loan officer and find out if it’s attainable,” she said. With 25 years experience in mortgage lending, Johnson said she has seen the process change with advances in technology. Email and texting capabilities have made communication between bank officers and borrowers much simpler. She added that with electronic signing of documents now available, clients can take care of business without even having to get in their car and traveling to the bank.
Local Realtor reflects on career
Home Buyer’s Guide
|
Sunday, April 1, 2018
|
13
Medlock says building relationships key to business
By Carole Medlock Special to the Times Record
W
ith almost 25 years experience in the real estate business, a local Realtor says she is doing what she loves with no plans to quit anytime soon. “No two days are ever alike. When I get up in the morning I’m still excited to come to work,” said Alice Medlock. Medlock is the owner and principal broker at Medlock & West Real Estate LLC in Van Buren. Born and raised in the area, Medlock pursued real estate after two earlier careers. She said the time commitment involved in the profession kept her from following her dream of being a
realtor earlier in her life. “There are no weekends or evenings off,” Medlock said. “Those are your busiest times. You’ve got to go when the people can go.” It was a little later in life when Medlock found herself single and with her daughter out of college that she made the choice to finally pursue real estate. “I’ve lived and breathed it ever since,” she said. Medlock said she loves being outside, something the real estate business has allowed her to enjoy regularly. “I’ve sold many homes, but my first love was the sale of land and farms. If our area could bear it, I would do only that,” Medlock said. Because Medlock was
born and raised in the area and had previously worked in people-oriented businesses, she said she enjoyed a broad customer base almost immediately. And that base continues to grow. She said she is now selling homes to the grandchildren of some of the first clients she had when starting out in real estate. “It’s building relationships and that’s a good feeling. I’ve made many friends,” Medlock said. About two years ago, Medlock said her business expanded, with the opening of a branch office in northwest Arkansas. “We were doing a lot of business in northwest Arkansas. It just became a matter of convenience to have a landing space
there,” she said. However, she said the market in NWA remains vastly different than that in the River Valley with moderately priced homes showing and selling almost immediately upon listing and buyers engaging in bidding wars by offering more than the asking price for homes in the area. She said agents with Medlock & West work more aggressively in the River Valley. Medlock said there are advantages to enlisting the help of a seasoned realtor in both the home buying and selling process. She said realtors know the area, the market and value of homes and property better than an individual either buying or selling might. She added that with
Alice Medlock owner and principal broker at Medlock & West Real Estate in Van Buren, talks about creating relationships during the buying and selling process that can last a lifetime March 15, 2018. [BRIAN D. SANDERFORD/ TIMES RECORD]
interest rates currently rising, anyone on the fence about buying or selling a home should take action. “Spring is the best time to list a home. It’s our biggest selling season. Now is the best time to list or buy,” she said. Medlock said she is
getting more calls from buyers who want to purchase land in the area than she can ever remember. People are interested in moving out of subdivisions and obtaining a little space. She said both large and small tracts are being sought out by current buyers.
14
|
Sunday, April 1, 2018
|
Home Buyer’s Guide
Why a personal appeal could sway a seller
By Marilyn Kennedy Melia CTW Features
W
hen Jessica Chadie and her husband viewed a condo in Jersey City, N.J., last year, she remembers thinking, “The sellers are a couple just like us. We saw lots of baby stuff and wedding pictures. They were at the stage we want to be in a couple of years.” So, would the sellers, who had several offers, be inclined to select Chadie and her husband as their buyer, because they also planned to make the condo a comfortable place to start a family? It certainly was worth trying to convey that message, says Chadie, who, with husband Moussa Kamakate, composed a letter to the sellers telling them just that. “I don’t know if it was the letter that was the one reason we [were selected],” Chadie says. “But I think it helped. I know that my cousin sold to people because of their letter.” Letters do sometimes sway a seller, even if there are other offers with a slightly better price, say real estate agents. But, because now the tight supply of homes on the market spurs buyers to do all they can, it’s likely other buyers are also sending letters. To stand out, letters should be personal and specific,
says Angie Lotz of RE/MAX All Pro in Bloomingdale, Ill. Adds Lesley Lannan, a Redfin agent in Buffalo, N.Y., “I try to find out as much as I can about the seller’s circumstances, like whether this was a long-time family home or more of a short-term investment. That helps determine whether a personal letter from the buyers will have an impact.” Lotz points to her client, Chris Caldwell, who wrote a letter explaining to a seller that they had been looking for a few years while living with his wife mother. During that period, Caldwell renovated her sixbedroom home himself. When a home came on the market in Glen Ellyn, Ill., a suburb that Caldwell and his wife had long scouted in for homes because of its excellent schools, easy train commute to downtown Chicago and charming homes, they got to work penning a letter on how much they wanted the property. Armed with the knowledge that the owner of the home, built in 1999, was the original and only owner and had a strong connection to the house, Caldwell and wife, Julie, expressed that they would likely be long-time owners. And, conveying their long hunt and Chris’s renovation skills may have convinced the seller that they were determined, and would maintain and love the home.
Ducks in a Row
Get your services set up before moving in By Carley Lintz CTW Features
electricity, gas, telephone, cable/satellite, internet, and trash collection with the seller. This will ensure that there is no interruption in services and prevent you from being left with any outstanding bills from the previous owner. “Always check the seller's disclosure to see who the current providers are to save time. There is a place to list them and their phone numbers,” says Susan Cavanaugh, a top agent with The Koehler Bortnick Team in Kansas City, Mo. “Often, the seller will need to inform the company of their upcoming move and approve the utilities to be put in a new name.”
Moving into a new home is never a stress-free ordeal. But, the last thing you want on top of the headache of packing up your entire life is to move into a home without running water, electricity or heat. In the excitement and fervor of real estate negotiations, it’s easy to forget about the little details, especially for first-time homebuyers. As the buyer, though, it is your responsibility — not the seller’s — to ensure the utilities are transferred over to your name in time for the big move. Here are a few key pieces of expert 2. Don’t wait until the last advice to keep in mind when handling minute. the transfer and set up of utilities in your new home. Getting services set up typically takes three to five days, but can take longer in 1. Discuss utilities with the the summer, which is the peak moving seller before closing. season in most places. Cavanaugh recommends contacting providers two Before you finalize the sale, you weeks before move-in to be on the safe should inquire about current utility providers, including water and sewer, See UTILITIES, 15
Improve curb appeal to add value
By Jim Weiker
More Content Now
A
mericans are expected to spend a record $340 billion on remodeling this year. Oh, but where to spend all that money? If you’re planning to live in your home for decades to come, spend it where you’ll enjoy it. But if you’re thinking of selling, there’s a different answer. Homeowners are most likely to get their money back on very visible, relatively inexpensive improvements, according to two recent studies that seek to measure return on investment for home projects. One of the reports, called the Cost Vs. Value study, concluded that adding a new steel front door and a new garage door may actually add more in sales price than what they cost. Adding stone veneer to an exterior comes close, returning an estimated 97 percent of its cost. “Curb appeal projects — changes to doors, windows and siding — by and large generated higher returns on investment than work done inside the home,” the report states. “Meanwhile, projects that called for replacing something, like a door or window, scored higher among real estate pros than did remodels.” Similar conclusions were reached by the other report, published by the National Association of Realtors and the National Association of the Remodeling Industry. The study, called the Remodeling Impact Report, found that homeowners get the most bang for their buck with new roofs, new wood floors, refinished wood floors and (again) a new garage door. Both studies compare builders’ estimated costs of projects to real-estate agents’ estimates on how much the projects would add to the price of a house. While spending money on more routine improvements yields the best returns, lavish discretionary projects don’t fare as well. The lowest return on investment come from a new patio and an “upscale” bathroom or master suite addition, according to the Cost Vs. Value Report. The Realtors’ report came up with a similar lineup: A new master suite, a new bathroom and a remodeled bathroom yielded the lowest returns.
In fact, as the Realtors’ study finds, agents almost never recommend big home-improvement projects. Only 2 percent of agents, for example, recommended finishing an attic or basement before selling a house, according to the report. Instead, agents say homeowners are better off showing the house they have in its best light instead of trying to make it a new house. “The thing that gets the most bang for your buck is to declutter everything,” said Jill Rudler, a Keller Williams Excel agent in Westerville. “Take 50 percent of what you have and remove it. The second thing is to paint. It’s inexpensive and will give a nice clean, fresh look to the weariest of houses. And replace any worn floor covering. The last you do is a deep cleaning.” If a piece of the house is broken or so dated that it’s a clear distraction, homeowners might also consider replacing that. In fact, the most common reason homeowners replace a garage door is because it doesn’t work anymore, not to add to the sales price, said Amber Cramer, who owns Central Ohio Garage Doors with her husband. “People who are selling the home may replace it, but if they put in a new door, it may not be a nice door, but just a simple one that works,” she said. “If they’re planning on staying, they’re more likely to install an upscale door.” Homeowners who don’t care about return on investment can enjoy remodeling simply to make their home more livable and pleasant. The Realtors study found that 75 percent of homeowners said they wanted to spend more time in their home after remodeling. When asked to rate the “joy” remodeling projects gave them on a scale of 1 to 10, homeowners gave the 20 projects an average score of 9.6. “Realtors understand which remodeling projects and home upgrades will bring the most value to homeowners,” said William E. Brown, the 2017 president of the National Association of Realtors. “Realtors also understand that many of these projects are undertaken solely to get more enjoyment from spending time at home.”
Home Buyer’s Guide
UTILITIES
|
Sunday, April 1, 2018
|
15
side. It’s also important to note that as a new owner, you may be required to pay a utility deposit, so be sure to ask about any fees and budget appropriately.
collection and home security as well. When researching companies, read the fine print carefully, including prices, service options and cancellation policies. One of the biggest mistakes Cavanaugh says she sees for first-time homebuyers is “getting locked into a contract that can't be cancelled for an extended period of time. This is most likely to occur with a cable or satellite dish company.”
3. Find the best providers for your needs.
4. Notify providers if the closing date changes.
While some providers are preset depending on where you live (water/ sewer, electricity, gas), for others you often have a choice. Start you search by asking about the providers the previous owner used. For instance, if they used a cable provider, it will be more hassle to switch to a satellite service. Don’t forget to ask about services like trash
Unfortunately, things happen during the real estate process and closing dates can change. “This is just a part of many real estate transactions and it's easy to just call the company back and move the transfer of service date,” explains Cavanaugh. Don’t wait too long, though, or you could end up paying for utilities you aren’t using.
From Page 14
16
|
Sunday, April 1, 2018
|
Home Buyer’s Guide
The secret to agent success Why your real estate agent is the MVP of your home-buying team
By Erik J. Martin CTW Features
I
n basketball, every position on your starting five plays a major role. Your point guard sets up the offense. Your center serves as a pivot and low post threat. And your power forward is often a key defender and rebounder. But it’s your go-to scorer whom you typically rely on to rack up the points and win the contest. In the game of real estate, your agent, who serves as MVP of your home buying squad, plays this role. Think of him or her as your personal LeBron James — a versatile expert skilled at many positions who can lead you to the promised land of your first home by putting you on the right path to the right property — right away. “A good agent can save you valuable time by identifying the best homes that fit your criteria, typically narrowing your search very quickly to the top five or so options. With an experienced agent on your side, you won’t have to spend weeks or months going from one open house to another to find the perfect place,” says Jay Batra, broker/founder with New York City-based Batra Group Real Estate. “Plus, they sometimes have access to inventory even before it hits the market.” What’s more, your agent can help assemble the rest of your team. “They can manage all the parties involved and the entire process on your behalf,” says Elizabeth Convery, founder/ broker with VERY Real Estate in Philadelphia. “They likely have relationships with all the other team members you’ll need — including a lender, inspector, title company and property attorney — and can make recommendations to you accordingly,”
Seth Lejeune, Realtor with Berkshire Hathaway Fox & Roach in Malvern, Pa., notes that these latter benefits are particularly important. “Most agents have preferred vendors they can suggest. Having a team of familiar vendors can increase the chances of a smooth transaction,” says Lejeune, who adds that you can choose these professionals yourself and aren’t obligated to go with your agent’s recommended experts. Additionally, an experienced agent knows the ins and outs
of specific areas and the types of homes that can pay you back later with higher resale value, “which helps protect your investment. They can also help ensure that you buy something that will fulfill your needs now and in the future,” says Laura Schwartz, Realtor with Keller Williams Realty in McLean, Va. What’s the difference between a Realtor, an agent and a broker, you ask? According to the National Association of Realtors (NAR), any person who earns a real estate license can be called an agent, whether
that license is as a sales professional, an associate broker or a broker. A broker, meanwhile, has earned education exceeding the agent level (as mandated by state laws) and has passed a broker’s license exam. A Realtor is either an agent or broker and is an NAR member; a Realtor must abide by that organization’s code of ethics and its 17 articles, enforced by local real estate boards. The “Realtor” title (a trademarked term) “is an added protection that your agent will act ethically, with integrity, and cooperate with other real estate professionals, which is a critical component once you start negotiating a home purchase,” Convery notes. To help choose the right agent or Realtor for you, it’s important to follow recommended criteria. “This person should be a good communicator and listener — someone who’s easy to talk to and understands what you’re looking for,” says Jen Teague, Realtor with Keller Williams Ellis County in Waxahachie, Texas. Experience can make a big
difference, too. “Pick someone who has been licensed for at least a few years and who can furnish a list of closed sales. You don’t want someone who does this parttime as a side gig,” Schwartz cautions. Listen to your gut instincts, as well. “You should work with someone you trust,” Batra says. “It’s also good to select an agent who specializes in your neighborhood and has sold similar houses in the area. To help you narrow down the right real estate candidate, ask these questions: • How long have you been licensed and how many sales have you closed? • Are you an agent or Realtor? Full-time or part-time? • Will I be working directly with you or someone else from your team? • What sets you apart from other agents? • What’s your strategy to help me save time and money? • Do you have online reviews I can see or past clients I can contact?
Not sure where to find a worthy agent? Ask comrades and kin for referrals, say the experts. “Word of mouth is far more powerful than a handful of Zillow reviews,” says Realtor Seth Lejeune. Broker Elizabeth Convery agrees. “A referral could be as simple as an introduction email directly to a real estate agent or the handing over of a business card,” she says. The best referrals are from trusted folks who’ve satisfactorily completed a real estate transaction within the past year or two. Also, seek referrals from folks within your generation if possible. “If you’re 28 and your parents recommend a great Realtor who’s 71, that may not be the best fit,” Lejeune says. Lastly, “don’t feel pressured to use someone just because a relative referred them. Research any recommended names carefully,” suggests Realtor Laura Schwartz. — CTW
Home Buyer’s Guide
|
Sunday, April 1, 2018
|
17
Rookie Triumph
How to succeed as a first-time buyer in a seller’s market By Erik J. Martin CTW Features
Y
ou’ve been saving like a diligent squirrel gathering nuts for the winter. You’re fairly confident your financials will land you a low fixed interest rate on a mortgage. And the time feels right to move out of mom and dad’s pad or that rental and claim a piece of the American dream by buying your first home. Problem is, many other people have the same plan. And there doesn’t seem to be enough affordable houses for sale to satisfy demand. Welcome to the 2018 edition of the sustained seller’s market. Strap in, because it could be a
bumpy ride. But don’t let that deter your driving ambition to become a homeowner — with the right planning and perspective, you can reach your destination, although it may require some nifty maneuvering say the pros. “First-time buyers are often at a disadvantage in seller’s markets for many reasons. They’re competing against other buyers, many of whom are more experienced in the process and can afford larger down payments and some of whom can pay cash,” says Michael W. Trickey, author of “Finding Home: Everything You Need to Know — And Do — For Home Buying Success (Finding Home BooksNext Century Publishing,
2016). By contrast, “First-timers are unfamiliar with the process, afraid of making mistakes, have less money available for a down payment and closing costs, need to obtain a mortgage loan, have more need of contract contingencies and need to rely extensively on their real estate agent to prepare and present their offer. They can find it difficult to react as quickly as needed in a highly competitive seller’s market,” Trickey adds. Ralph DiBugnara, vice president at Residential Home Funding Corp. in Parsippany, N.J., agrees, noting that continued lack of inventory (the national housing supply has dropped for 30 straight months,
per the National Association of Realtors) isn’t helping matters. “It can be frustrating to purchase in a seller’s market because you will most likely have to overpay for a property, which pushes you above your anticipated budget,” DiBugnara says. “This leads to a loss of negotiating power. When sellers receive multiple offers, they can give you a ‘take-it-or-leave-it’ attitude.” Consequently, hopeful home shoppers have to be prepared to act quickly if necessary. They need one or more backup plans in case an offer falls through. And they should expect some setbacks and slowdowns along the journey. Maintaining a positive attitude and remaining
realistic yet persistent is also important. “Remember that owning today is usually cheaper than renting. Plus, it’s a great time to take advantage of near record low interest rates and great low down payment programs available, including a Fannie Mae Home Ready program that only requires 3 percent down and a 3.5 percent down payment FHA loan for those who qualify,” says Richelle McKim, broker with Castle Rock, Colo.-based 121 Realty. Buyers can also take solace in the fact that a strong seller’s market indicates an in-demand area where home values are due See TRIUMPH, 18
18
|
Sunday, April 1, 2018
|
Home Buyer’s Guide
Tips for a stress-free move
Brandpoint
Does the prospect of moving have you buzzing with excitement? Or are you left with worries about packing and clutter? This moving season, an estimated 40 million Americans will move or relocate, according to the U.S. Census Bureau. Moving is an exciting time, creating opportunities to start fresh and reinvent your life. But whether you’re moving by yourself or uprooting your entire family, moving presents a number of stress-causing challenges. Staying organized and planning ahead will be your best armor against the moving blues. Ease your transition with some of these professional organization tips: Make a plan. Your calendar will be your best friend throughout the moving process. As soon as you know your moving date, schedule moving help and/or a truck rental. Then, block out time in your calendar for each step of the move,
including packing, payment due dates and paperwork. Schedule a day or several to walk through your home, opening every cabinet and drawer, to get rid of what you don’t need or use. Clear the clutter. Did you know that 91 percent of Americans say they have kept an item because they feel guilty getting rid of it? That’s a lot of leftover gifts, family heirlooms, greeting cards and rarely worn clothing just lying around. And when you have a home filled with disorganized clutter, you can spend hours searching for misplaced items. A move is a great opportunity to go through that stuff and make the tough decisions about what to keep and what to toss. Stock up on supplies. From cleaning supplies to boxes, to labels, packing tape and scissors, you’ll want to make sure you have all the tools you need. Set up a “moving station” somewhere in your current home where you store all your moving necessities. Be sure to select
the right boxes for moving your different types of belongings. Create a moving binder. A threering binder is an organization staple for any area of your life. Store and file moving company brochures or business cards, important paperwork like leases or closing documents and use a pouch for holding pens and sticky notes. Pack like a pro. Assign a color to each area or room of your home. Use colored pens, tape and stickers so you can easily see your color code from across the room or from inside a moving truck. Label all sides of your boxes so you can easily see where a box belongs even when they’re all jumbled together. Prepare for moving day. Leading up to your move, make sure to hydrate, rest and eat well. Take care of yourself so that you’ll be completely ready to take on the tasks at hand. Don’t forget to pack a survival box with the essentials you need for the first night in your new home.
TRIUMPH From Page 17
due to continue increasing in value, which can be rewarding when it’s time to sell in the future. For best success as a firsttime purchaser, count on doing plenty of homework before you make your first offer. For starters, learn and improve your credit score by visiting freecreditreport.com; you’ll qualify for better mortgage rates if your score is 720 or higher. Next, “Get a mortgage preapproval from a lender, which can help determine what you can afford and keep you from not overreaching financially,” Ron Alishah, Realtor with the Keyes Company in Plantation, Fla., says. Speaking of lenders, shop around and compare rates and terms carefully.
“Check online and with local lenders for programs they may have available for first-time buyers,” Trickey says. “Many national and state programs also exist to aid first-timers, so do a thorough search.” Enlist the help of a real estate agent early in the process, too. “Contact and interview several of them, and pick one whom you like and trust,” Trickey says. “Make sure they have a well-established network and access to information about homes that are about to come onto the market.” Together, scout your desired locations carefully. “Find out what’s driving that market,” Trickey says. “Is a major employer recruiting nationally and adding lots of new employees who are moving into the area? Is the school system highly ranked? Decide if the factor that’s driving demand and prices is important to you. If it’s not, you may want to look in another area.”
Another top tip: limit your demands. “Be careful not to include too many contingencies when making your offer,” says Cheryl Eidinger-Taylor, president of ERA Key Realty Services in Northbridge, Mass. “Even if your offer is higher than another’s, it may be rejected if you place too many demands on the seller, like expecting them to pick up closing costs or include appliances in the sale.” Also, have a plan in case a bidding war erupts, and be ready to walk away from a bad deal. “Don’t let a hot seller’s market put you into a negative financial situation,” Trickey cautions. Lastly, exercise patience if things don’t go your way or at the pace you prefer. “Remember that a slower process can be better for a first-time buyer,” DiBugnara says. “This forces you to do more research and not make an impulsive purchase.”
Home Buyer’s Guide
|
Sunday, April 1, 2018
Is now the right time to rightsize? By Melissa Erickson More Content Now
A
fter the kids move out on their own, many adults consider downsizing to a new home, possibly moving to the city or to a beach town away from it all. Why downsize, though, when the better option is to rightsize? Rightsizing is different from downsizing, which seems inherently negative and focuses on space. “It’s got a bad connotation, like you’ll be moving to a smaller apartment or condo. Giving up and giving in,” said Realtor Marie Presti, owner of The Presti Group in Newton, Massachusetts, and a certified educator who has taught dozens of classes on the subject. Instead of moving to a smaller home because you’re
an empty-nester, “rightsizing is a process of looking at your current lifestyle and analyzing what’s right for you. It doesn’t necessarily mean smaller,” she said. “Downsizing is about cutting away. Rightsizing is about the big picture,” said rightsizing expert Lynn McPhelimy, author of “In The Checklist of Life.” “Consider it a restructuring focused on your quality of life. We all want quality of life; this is how we get there.” Visualize your right home The factors that influence rightsizing include your health, finances and relationships, McPhelimy said. Other considerations include things like where you want to be in five or 10 years; whether you will continue working; and whether
there is good public transportation and access to cultural activities, restaurants, hospitals and health clubs, Presti said. Consider the home you’re living in, McPhelimy said: Are you using all the rooms wisely? Does mail collect on the dining room table, and are kids’ rooms now used as storage areas? “Where do you really live in your home?” she asked. It’s possible you may want a bigger home for entertaining or to have guests or grandchildren visit, McPhelimy said. The same square footage may be ideal if it’s all on one level with no stairs, she added. Additionally, think about lifestyle needs such as time and energy spent on yard maintenance. “Do you really want to mow the lawn, use the snow blower
and paint the house every 10 years?” Presti said. “Are your friends still living nearby, or has the neighborhood changed and are you left isolated and lonely?” McPhelimy asked. Financial considerations are paramount to living your dreams, McPhelimy said. Are you asset-rich but cashpoor? Do you have too much house? Since you will eventually be living on a fixed income, think about what you want to be spending money on, Presti said. Do you want to spend money on house upkeep? How much are your property taxes?
|
19
You can’t push people into making a decision. There are hurdles, especially the emotional connection to leaving the home you’ve raised your children in,” Presti said. Because it may take some time, it’s never too early to get started. “Do it before a crisis happens, while you’re happy and healthy,” McPhelimy said. While you’ll need to “follow your heart and your bank account,” financial planners and real estate professionals can also help with the decision, McPhelimy said. Once you’ve gotten close to a decision, do a test run. Rent a Get started early home through a site like Airbnb or VRBO during the off-season “It can be a very emotional, to see what winter is like in multi-year process to decide Seattle or summer in Phoenix what your needs and dreams really feels like, McPhelimy are and will be in the future. said.
20
|
Sunday, April 1, 2018
|
Home Buyer’s Guide
How to find an affordable home in today’s market
StatePoint
A
ffordable housing is in high demand in cities and counties nationwide. Experts say that areas grappling with affordable housing issues may find factory-built homes to be a powerful tool in addressing this need. Built in a factory and delivered to home sites, this efficient process translates into lower production costs that are passed on to the consumer. The good news is while manufactured homes cost less than sitebuilt homes they are just as high quality. The average new manufactured home costs around $70,600. The cost for a smaller new single-section home can be as low as $20,000. In 2016, manufactured homes accounted for 80 percent of all new homes sold under $150,000. Unfortunately, when many people think of manufactured housing, the old stereotype of a run-down trailer park enters their
minds. However, most of the more than 37,000 manufactured housing communities in the U.S. are a far cry from that negative image, boasting amenities like community centers, organized activities and children’s play areas. Other benefits may include: • The option to rent an existing home in the community or place your own home in the community. • Provided services, which often include professional property management, care and maintenance of common grounds, as well as resources and amenities like trash removal, community centers, playgrounds, storage and laundry facilities. • The possibility of not paying real estate taxes. While it varies stateto-state, residents of land-lease manufactured home communities often don’t pay real estate taxes, but rather, pay a personalproperty tax, offsetting the cost of land-lease rents for the homeowner.
• Affordable homeownership, along with many of its benefits, including control over home and yard improvements, as well as convenient parking. • A sense of community. In many communities, there are social or activity clubs, fitness amenities, and friendly and caring neighbors. Indeed, “sense of belonging” is among the
most frequent responses about why residents enjoy living in a land-lease community. Newer manufactured homes come in a variety of architectural styles and exterior finishes that will suit most any buyer’s desires, as well as customization opportunities, including interior features like vaulted ceilings,
fireplaces and state-ofthe-art kitchens and baths. They also feature enhanced energy efficiency in an era of rising energy costs, thanks to upgraded insulation and more efficient heating and cooling systems than homes from decades ago. Smart buyers also are turning to ENERGY STARlabeled manufactured
homes for additional savings. Modern manufactured homes are among the safest housing choices today, as homes must adhere to strict federal building standards. All aspects of construction are continually inspected by professionally trained third-parties, and homes feature smoke detectors, and limited combustible materials around furnaces, water heaters and kitchen ranges, as well as wind resistance in areas prone to hurricane-force winds. “The need for quality, affordable housing has never been greater. However, today’s manufactured homes are high-quality and cost up to 50 percent less per square foot than conventional site-built homes,” says Richard Jennison, president and CEO of the Manufactured Housing Institute. “These savings are allowing more Americans to own a home in the face of an ever-widening housing affordability gap.”
Are common myths holding you back from buying a home? StatePoint
A
spirations of home ownership is strong for America’s families, yet findings from the fifth annual America at Home survey from NeighborWorks America indicate several perceived barriers to homeownership among the majority of consumers. Findings from the survey, which consisted of 1,000 U.S. adults and 500 millennials include many misconceptions about what it takes to buy a home: • The average millennial mistakenly thinks the minimum
required down payment is 21.6 percent. • About 73 percent of all consumers and 62 percent of millennials said they were not aware of or are unsure about down payment assistance programs in their communities for middle-income homebuyers. • Seventy percent of adults
feel they don’t have enough money saved for a down payment. Experts believe that confusion about down payment requirements and lack of awareness about assistance programs are holding back many people from pursuing homeownership. “Before deciding if owning a home is right for you, take time to understand your down payment options, and separate myths from facts,” says Freddie Mac Vice President, Danny Gardner. For example, the average down payment among firsttime homebuyers in 2016 was just 6 percent and, for repeat
buyers, just 14 percent. What’s more, mortgage options, such as Freddie Mac’s Home Possible Mortgages, make it possible for qualified borrowers to put down as little as 3 percent. If your down payment is less than 20 percent with a conventional loan, you’ll have to pay private mortgage insurance, an added insurance policy that protects the lender if you are unable to pay your mortgage. However, mortgage rates — despite their rise in recent years — remain at historic lows, providing you with a significant advantage. There are also millions of
dollars available for down payment assistance. A great place to start is right where you live. Many state, county, and city governments provide financial assistance for people in their communities who are well qualified and ready for homeownership. To help demystify down payments and the homebuying process, free tools and resources are available at myhome.freddiemac.com. Don’t let misconceptions hold you back from pursuing homeownership. Check out the facts to learn how much home you can afford.
Home Buyer’s Guide
|
Sunday, April 1, 2018
Smart home upgrades appeal to home buyers love the energy savings, as well as the ability to control rom smart thermostats the thermostat from anyto remotely controlled where with their devices. showers, connected homes are all the rage for Bright Lighting today’s homeowners and those looking to make a Smart lighting dimmer and purchase, providing easy sensor systems allow you to opportunities to boost your turn lights on and off remotely profit when you sell. with a smartphone, and can be More than half of Millen- customized to perform certain nials (57 percent) believe actions, such as slowly growthat smart home technology ing brighter as you wake up or is a good investment in their turning off automatically when home, according to a recent survey by Better Homes and Gardens. Upgrading to include connected items can make your home more appealing to this “next generation” of homebuyers in particular. If you’re looking to sell, here are some of the latest and greatest smart home upgrades to have on your radar. StatePoint
F
Climate Control Your thermostat is responsible for half your energy bill — more than appliances and electronics — so make sure to choose one wisely. Consider installing a smart thermostat, which learns your temperature preferences, and can save energy by turning heating and cooling on and off, based on the weather outside, your home’s energy profile and more. Potential homebuyers will
you leave your home — providing added convenience and customization for prospective buyers. These systems are especially useful when you’re traveling — allowing you to turn your lights on and off remotely, so your home doesn’t look empty while you’re away. Picture showing potential buyers how they can control all of the lights in the home with one device, or turn off the lights after they’re snuggled up in bed — and get
ready for the offers to roll in.
on the faucet, the technology also minimizes the spread of A Hands-Free Faucet dirt and germs, since there’s no need to touch the faucet Imagine the convenience to start the flow of water. It’s of having a kitchen faucet just the type of smart upgrade turn water on or off, with- to attract house hunters of all out a touch. Faucets with ages — and easy on the wallet, hands-free technology, such with options available for as Moen’s MotionSense Wave under $300. single-sensor models, allow users to easily activate the A Digital Shower faucet with the wave of a hand. Great for when your hands An updated bathroom is a are too full or messy to turn huge selling point for potential buyers. If you’re planning a renovation, enhancing your space with a digital shower can make a big difference for your family now and for future homebuyers. To provide the ultimate in personalization, select a system such as U by Moen, the first Wi-Fi/cloud-based digital shower on the market, which allows users to precisely set shower temperature and flow with an in-shower digital controller, or from the smartphone app. Plus, it can be voice activated with products like Amazon Alexa, for a connected home experience. By swapping just one or two items — like your thermostat or a builder-grade kitchen faucet – you can achieve a sleeker, smarter home. And while the return on investment varies for each product, they’re all sure to appeal to tech-loving homebuyers whenever you choose to sell.
|
21
22
|
Sunday, April 1, 2018
|
Home Buyer’s Guide
Home trends for 2018 By Melissa Erickson More Content Now
W
hether you’re buying a new home or looking to freshen up your own, knowing the latest building and decor trends will keep you in style. • Move over, man caves: Women are getting a room of one’s own, said Realtor Marie Presti, owner of The Presti Group in Newton, Massachusetts. Called she rooms, babe caves, she shacks or she sheds if they’re located in the garden area, these rooms offer a getaway space for busy women juggling home, work and family. “It can be a place to hide out, especially since open floor plans in homes are so popular,” said
Presti, president of the Greater Boston Association of Realtors and 2017 Greater Boston Realtor of the Year. Having a home office will never go out of style, and that’s just what many buyers are asking for — except instead of focusing on a desk and cabinets, women are transforming these spaces with window seats and decorative pillows, Presti said. The extra room in the house or the converted garage now becomes a music or relaxation room, upscale closet, yoga studio, or just a place to hang out with a glass of wine and book club friends — and there’s still space to curl up with a laptop and get work done. • In the bathroom, the
whirlpool bath is being replaced by a high-end shower, Presti said. These spa showers are generally bigger, with benches, inset shelving and multiple shower heads like a rain head, body jets and a handheld jet. “Close the door and it becomes a steam room, and there’s no drain set in the middle. Instead, the floor angles so water runs off to a drain hidden underneath,” Presti said. • Home bars are once again popular, both as a family focal point and for entertaining guests, Presti said. A great way to use up some extra space, home bars are outfitted to suit the family’s drinking habits, whether that means a built-in keg, wine refrigerator, espresso bar or a cool place to store juice, water and soda. • Accessory apartments are
also becoming increasingly popular as the country deals with an intense demand for housing, according to the National Association of Home Builders. Called in-law or granny suites, accessory apartments can be separate dwellings on a home’s property or converted basements or garages. Theses self-contained living units are ideal for “downsizers” or empty-nesters, college students and other young adults, Presti said. It’s also a great way to make a little extra money renting space to a family member. • Mixed metals are on trend for 2018, so you’ll be seeing silver and gold complimenting each other along with other metallics like rose gold, copper and brass, Presti said. • While grays are still popular and being used, “they’re moving down” and instead the emphasis
is trending toward warm neutrals like beige, taupe and brown, Presti said. And yet, the Pantone color of the year is a ultra violet, a blue-based purple. Watch for it popping up in accents, textiles, wall coverings and more. • The ultra-luxe feel of velvet furnishings will wow in 2018, but if you’re not bold enough for a purple velvet couch, try the look with some velvet throw pillows, Presti suggested. • Also within reach are painted ceilings, which designers consider the fifth wall. A dark color can surprisingly open up a small room by adding a feeling of infinity. Or, paint the ceiling the same as or a shade of the wall color. Just be careful of this trend if you’re looking to sell in 2018, Presti said. “Buyers want things as neutral as possible,” she said.
Home Buyer’s Guide
|
Sunday, April 1, 2018
Termites can be source of headaches for homeowners By Orval Smith Elite Exterminating Inc.
T
his pesky little insect that one hardly ever sees causes more than $5 billion dollars worth of damages to homes and businesses every year in the U.S. Many homeowners have had the experience of dealing with the damage caused by termites at some point during their lifetime. Some have had major issues and damages while others may have only had to have their home treated and the annual inspection performed. For new homeowners, termites may be one of the last things you think about during the search for a new home. Termites and termite damage can have a huge impact on the potential purchase of a home. When a real estate contract has been signed and completed, this starts the process of several steps and inspections that have to be done within a certain
time frame. Termite inspections are usually one of those inspections. Today, most lenders require that an inspection for termites and other wood destroying insects be performed and documented prior to closing. In Arkansas, when a termite inspection is done a clearance letter is issued to the title company for the purchase. Under normal circumstances, this clearance letter includes a termite treatment for the home as well as a one year
guarantee. However, in Oklahoma the normal process is just a termite inspection with the required documentation, but no treatment is performed unless live termites are found during the inspection or the buyer requests a treatment. Each state has different regulations concerning the treatment and the types of guarantees that termite companies offer. In Arkansas and Oklahoma, termite companies can offer two
different types of service agreements. With a repair agreement, future damage that may be caused by termites may be the responsibility of the termite company to repair or replace. Of course each termite company lists their own requirements and limitations in their serve agreements. The other type of service agreement is a retreat or service agreement and could mean that the only responsibility the termite company may have is to retreat any new or live termite infestations but may not have the responsibility to perform any repairs on the damages caused by termites. Both Arkansas and Oklahoma require that the type of service agreement be clearly stated on the contract. When you find your dream home, don’t forget to ask your agent about the termite inspecion and the type of guarantee that you are getting.
|
23
24
|
Sunday, April 1, 2018
|
Home Buyer’s Guide