Smart Ways to Build Equity in Your New Home

Now that you’ve invested in a home, how do you increase its value?

That’s called “building equity.” Equity is the market value of your home or property, minus your outstanding mortgage debt. So, for example, if you can sell your home for $450,000 and you still owe $100,000, you have $350,000 in equity. Building equity is one the biggest financial benefits of ownership.

If you live in a market where home values are rising, yours may float up with the rising tide and your equity will increase without doing a thing.

Or you can work on growing your home’s value by decreasing the amount you owe and/or increasing the value of your property. Here are some ways to do both.

Mortgage payments

Part of every mortgage payment goes towards paying off your loan’s principal and interest, with most of the payment going to interest in the loan’s early years. You can use Zillow’s amortization calculator to estimate how much money will be paid over the life of your loan for principal and interest. If you pay down the principal faster, your equity should increase faster. This can be done a few different ways.

Paying more: If you have a 30-year mortgage, adding more to your payment either monthly or when you have extra cash can help you gain equity. If you pay more, make sure your lender applies it to your principal. This is a great way to use your tax refund, a bonus from work or an inheritance.

Paying faster: You could divide your monthly mortgage payment into two bi-weekly payments, for a total of 26. So instead of 12 payments a year, you make the equivalent of 13, paying down your mortgage faster and gaining more equity. But make sure to check with your lender first to make sure they accept bi-weekly payments. And make sure all the extra money goes immediately to the principal instead of waiting for the second half-payment. Reputable lenders will not charge a fee for bi-weekly payments.

Refinancing: If you have a 30-year mortgage, you might want to consider refinancing to a 15-year loan, which has a lower rate. Most consider this worthwhile only if you can drop your interest rate by at least 1.5%. Factor in any closing costs before making this move. Also make sure your mortgage doesn’t have a penalty for pre-payment. It’s not common, but it’s better to check.

Before you decide on any of these options, consider if it’s really the best use of your money. If you’re not maxed out on employer-matched saving accounts, perhaps you should be putting extra money into your 401(k) rather than paying off a low-interest mortgage. It’s smart to talk with a financial advisor to determine the best investment strategy for you.

Also make sure you have an emergency fund, typically 6 months of savings in case you fall ill or lose a job.

Renovate wisely

Making smart improvements and adding the right amenities to your home can also increase its market value, which means more equity for you.

How do you know which projects will bring the best return on your investment? Even though you’ve just moved into your new place, there are home improvements buyers typically love: bathrooms, attics, entrances, kitchen updates, garage doors and siding. Popular features can vary by area and home type, so consider what’s in demand in your market.

Also, be mindful of your market as you’re thinking about how much to invest in improving your home. The realities of a buyers or sellers market will have an impact on how much return you’ll get when you sell.

You can find more inspiration, ideas and guidance in Zillow Porchlight home improvement articles.

For new homeowners, Zillow’s design and home improvement videos show you how to tackle your first project.

Source: zillow.com

What Happens When a One-of-a-Kind Home Needs a New Owner?

It’s essential to have the right marketing plan, pricing strategy and real estate agent.

When shopping for a home, it’s not uncommon to come across one that truly stands out. It’s not because the home is an old fixer-upper or that it’s a newly renovated home with a designer kitchen. It’s a home that’s architecturally significant or in some way conveys a “different” attribute. For instance, it might be a castle, a church or even a fire station that has been converted into one or more living spaces.

With an unusual home, pricing and marketing can be a challenge. Here are three things to keep in mind when either buying or selling a truly unique property.

1. Buyers should be cautious

As crazy as it sounds, a would-be buyer may want to reconsider purchasing an offbeat home. While it may be a home you love, it is also an investment. A home with a unique, unchangeable structural feature will likely alienate a large portion of the market.

If you’re faced with the opportunity to purchase a unique home, don’t get caught up in the excitement of it all. Think long term. Understand that when it comes time to sell, it may be a burden, particularly if you try to sell in a slow market.

2. When selling, don’t assume buyers will love what you love

As the owner of an interesting or different home who is considering a sale, be aware that not everyone will have the same feeling about the home as you did when you bought the place. While you’re likely to get lots of activity, showings and excitement over your property, a lot of that may simply be curious buyers, nosy neighbors or tire kickers.

Time after time, sellers with unique homes believe that since they fell head over heels, another buyer who might feel the same. But that person could be hard to find.

3. Hire the right agent and have a serious marketing/pricing discussion

A unique home requires a unique marketing plan and pricing strategy as well as a good agent. The buyer may not even live in your local market, and instead might be an opportunist buyer open to a unique property. So you should consider advertising outside the mainstream circles. Media and press can help get the special home the attention it may need.

The buyer may not want to live in your town but is fascinated by an old church or castle. The more you get this out there, the better your options for finding the specific buyer.

If you get lots of action but few offers, you may need to drop the price below the comparable sales to generate interest, particularly if you really need to sell. Just like a home with a funky floor plan, on a busy intersection or with a tiny backyard, the market for your unique home is simply smaller.

With online home listings, blogging and real estate television shows, unique homes stand out and get more exposure than ever. But selling a distinctive or offbeat property requires out-of-the-box thinking early on, and with a top agent. You only have one chance to make a first impression. Be certain to price the home right, expose it to the masses and have a strategic plan in right from the start.

Top image from Zillow listing.

Related:

Note: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinion or position of Zillow.

Originally published October 10, 2014.

Source: zillow.com

RMS Settles with NY Regulator for $1.5M Over Data Breach

Residential Mortgage Services will pay $1.5 million in a cybersecurity settlement with New York’s Department of Financial Services, the agency has announced.

According to a consent order, RMS suffered a data breach but failed to disclose it to the regulator as required under state cyber rules.

RMS generated a record mortgage origination volume of $8.5 billion last year, according to a press release from the company.

Read the full announcement from New York’s Department of Financial Services.

Source: themortgageleader.com

5 Weird Reality Checks You’ll Get If You Buy a Country Home

City living may have its perks, but combine the congestion and crowds with the threat of the novel coronavirus, and it’s no wonder that many city dwellers these days are fleeing to greener pastures (or thinking about it).

But what is it really like to transition from the hustle and bustle of a city to the more relaxed pace of rural life? As a New Yorker who bought a summer cottage with my husband in upstate New York six years ago, I’ve come to realize that country life isn’t always so serene. In fact, certain things have happened out yonder that make me very glad that we’ve kept New York City as our main residence.

Curious about what curveballs might await if you buy a country home? Here are a few of my more surprising discoveries.

Country life: Is it right for you?
Country life: Is it right for you?

William Geddes

1. The country’s serene silence is often punctuated by gunfire

People in the country love their guns. I’m fully behind the Second Amendment, but we didn’t realize how much shooting takes place in small towns, especially at local gun and hunt clubs, of which there are many in our upstate county.

In fact, there’s one right across the road from our house, and the members shoot skeet early every Sunday morning—without fail. It’s loud and probably should’ve been a deal breaker for us when we considered the house, but we bought it anyway.  Now we take a long walk with the dog when the popping begins.

2. Cute woodland critters will eat everything you plant

I listened to the nursery specialists and planted the flowers that deer weren’t supposed to eat, but they still come by regularly to nibble. Apparently, in a bad winter, if these animals are hungry enough they’ll forgo their usual diet and consume just about anything.

So I nixed the flowers and went with wild grasses and herbs—and the bunnies thanked me by enjoying a nice salad every chance they could. As a last resort, I’m now letting the garden slowly grow over to grass and adding mulch to tamp down any errant weeds. My dream of colorful flower beds has turned into a patchy lawn with brown bits for accent.

Dozens of flats later,and still the garden is spotty
Dozens of flats later,and still the garden is spotty

William Geddes

3. Cute woodland critters probably live inside your house

Rodents are expected in a 200-plus-year-old house, so we set traps every weekend during the colder months. (My husband is charged with mouse eradication.) But I never expected the mice would nest—and birth babies—between our bed sheets. After finding a furry family tucked inside my comfy queen bed, going to sleep has become a bit of a nail-biter, since I’m always wondering what I might find there next.

4. Dogs can’t run free

Our rescue pup pretends to guard the front lawn.
Our rescue pup pretends to guard the front lawn.

William Geddes

One great joy in owning a country house (we thought) would be the ability to open the door and let Django, our sweet dog, race around. But when she did venture forth, everything went south.

While chasing a possum, Django apparently charged (and frightened) the neighbor across the way and her two lap dogs. Said neighbor let me know that this was not OK on her property. Clearly getting to know our neighbors was getting off to a great start!

Next, Django proceeded to chase a mouse into the downspout of another neighbor’s house and then punctured the metal with her jaws to get the creature out. Needless to say, I was on the hook for a new downspout that had to be custom-fit and painted to match my (now irate) neighbor’s house.

5. Country dogs are huge and scary

Meanwhile, my neighbor on the other side of me has an enormous black shepherd that, I kid you not, looks a whole lot like a black bear. Even worse, this dog doesn’t have tags that jingle when it approaches, so every time it appears on our lawn, I’m convinced it’s a bear and start to panic.

Every. Time.

I’m thinking of giving this neighbor a set of cute tags for the dog’s collar with the hope that it’ll be worn and my blood pressure will finally recover. Until then, I keep practicing deep breaths as I sink back into the deck chair on the porch of my country house and try—and fail—to relax.

All I’m saying is if you think owning a country house ushers you into a life of peace and quiet, don’t be so sure.

It wasn't me—I didn't do it!
It wasn’t me—I didn’t do it!

William Geddes

Source: realtor.com

Should You Refinance?

You may not need a map to find your hidden treasure. It could be, literally, right beneath your feet. Sometimes, the best way to get the most out of owning a home is to refinance your mortgage. Refinancing can be a powerful tool that could help you lower monthly payments, pay off your mortgage faster, or save tens of thousands on interest in the long-run.. Many don’t understand how to refinance and others wonder if it’s the right decision. Here are some factors to consider.

Take Advantage of Low Interest Rates

In the past, interest rates were high and the amount of buyers was low. Today, it’s not uncommon to see rates below 3%. Interest rates are one of the biggest factors to consider when it comes to getting a home loan or a refinance.

The Low Interest Rate Advantage

Let’s say you have an interest rate on a 30-year mortgage for $300,000 at 5%*. Your monthly payment would be around $1,610. If some years have gone by and the amount you owe on the home has dropped to $260,000, a refinance could make your monthly financial picture look a lot prettier. Here’s how:

If your lender offers you a rate of 2.9%* on $260,000, your mortgage plummets to $1,082. Because you were paying $1,610 before, you will be saving $528 every month.
For the sake of simplicity, this example doesn’t take into account taxes and insurance, but if you were paying private mortgage insurance (PMI) before you refinanced, the lower principle and higher home value would free you up from that as well, resulting in additional savings.

Refinancing to Save on Your Mortgage as an Investment Strategy

With the help of some basic investment tools, you can save even more when you refinance. If your budget can sustain your current mortgage payment, you could still refinance for the purpose of using the money you save—to make more money. Here’s are some ways to use your refinancing savings as an investment vehicle:

  • Take the money you save and invest in CDs (certificates of deposit). You can save up and then invest or you can start as soon as you hit the minimum and open several at once.
  • Use the money to contribute to a retirement plan. This is one of the most profitable techniques because the money gains interest over a longer period of time. Eventually, you can have a pretty little nest egg waiting for you when retirement rolls around.
  • Invest in the stock market. Whether you go with traditional stocks, ETFs, or indices, a conservative strategy can still provide handsome rewards.
  • Invest in a business. You can put money into a business idea that’s been spinning in the back of your head for a while.
  • Refinancing for Home Improvement

    Home improvement projects that have been lingering for a while are easy to knock out if you have the cash to do it. Whether you want to take your home to the next level for personal reasons or to add to its value, refinancing can help you get your hands on the cash you need.

    If you want to boost your home’s value, you should first check to make sure the uptick in the appraisal is going to be more than the sum of the cost of the refinance and the improvements. It may be best to consult a realtor or do your own comps to figure out how much value you’ll be adding to your home. Here’s how to do it:

    • Find a graph of home values in your area—for your type of home—over the last 10 to 15 years. Print it out. If there’s an upward or downward trend, use a ruler to extrapolate the approximate selling price of your home when you plan to sell it. Alternatively, you can consult a licensed real estate agent. A local agent will be able to give you a good idea of what is in demand in your area.
    • If you plan on adding a bathroom, bedroom, or other space, find a similar graph for homes with that added feature and do the same thing.
    • Compare the expected value of your house when you may sell to what it would be worth without the remodel.

    If the difference is higher than the cost of your refinancing and remodeling, you will be making a profit.

    When to Think Twice About Refinancing

    If you have a low interest rate already, refinancing may not be worth the cost, especially if you recently purchased your home. If you owe close to what you paid for the home and the refinancing interest rate isn’t much lower than what you currently have, it may not be worth it.

    In addition to that, you should compare the monthly savings to the amount of time you plan to spend in the home, weighed against closing costs. If this is your forever home, a refi might be worth it if everything else is right.

    Consult Homie Loans™***

    Refinancing can be a powerful financial tool. If you’re ready to crack open the treasure chest by refinancing your home, Homie Loans is here to help. Homie Loans has quick turnaround on refinances, so you’re not left hanging. If you find a better rate, we can give you $500 back**. Learn more about Homie Loans today.

    *For illustrative purposes only. Rates Vary. Contact Homie Loans for a quote today.
    **Terms and conditions apply. Click here to learn more.
    ***Homie Loans, NMLS# 1016597, UT MB#8533383, AZ MB# 0945972

    Source: homie.com

    Why Is It Required to Have Car Insurance?

    In 49 states in the United States, there is some form of compulsory insurance for motor vehicles. Many people ask, “Is car insurance required?” since it may not be immediately apparent if you see yourself as a good driver willing to pay for any potential damages to your car. The answer to “Why is car insurance mandatory?” lies in the type of car insurance. Perhaps you’re looking to why you need car insurance. There are both mandatory and optional coverages to consider.

    In this article

    Is car insurance mandatory in the U.S.? 

    Car insurance isn’t mandatory at the federal level in the United States, though all but one of the 50 states do make some kind of coverage required.

    This means that what counts as “state minimum compulsory insurance” in each state will be slightly different. These minimums are what the state considers the minimum you should purchase to cover your liability adequately.

    States like Iowa, Ohio, and Wyoming have meager costs. Other states may have high premiums due to the high cost of living in the state, but the minimum coverage is lower, like New Jersey, Michigan and Florida. As a result, the minimum coverage could pay less in a costly accident.

    Costs for minimum car insurance are reliant on the amount of compulsory coverage in the state and how common expensive accidents are, and the typical costs of those accidents. States like Michigan have specific laws requiring unlimited personal injury protection coverage that change how much it costs to insure a motorist.

    Why do states make car insurance mandatory? 

    Mandatory minimum car insurance is liability insurance, making it different from many other kinds of insurance you probably have considered purchasing. If you own a homeowner’s policy, a healthcare insurance policy, or a renter’s insurance policy, those all focus on recouping losses that you experience. You’re buying them to protect yourself or your property.

    [ Read: What’s the Average Cost of Car Insurance in the U.S.? ]

    However, you don’t drive your house around, potentially harming other people. Car accidents have adverse effects on other people, and liability coverage is mostly focused on the two kinds of harm you can cause if you are at fault in an accident: medical expenses and damage to the other vehicle.

    It can be tempting to feel like car insurance should be optional until you consider the results if someone else runs into your car. Suppose you had a big pile of medical bills and a totaled car, all because someone without liability coverage made a careless driving choice. In that case, you probably see why mandatory minimum car insurance gives everyone a base level of protection from other drivers.

    New Hampshire, the only state that doesn’t require car insurance, still has it’s own version of liability. You’re allowed to either have the insurance or be willing to pay those costs yourself if you don’t have insurance. It’s not a mandatory insurance policy, but the liability is still there, so most people opt to get coverage.

    What happens if I don’t have car insurance? 

    Getting pulled over when you do not have car insurance in a state with mandatory minimum car insurance is very costly. Even a first offense of driving without insurance can result in a suspended license, large fines or even having your car impounded in some states. Second offenses are more likely to lead to jail time. All instances of driving without insurance can lead to increases in your insurance premiums in the future when you apply for a policy.

    [Read: Caught Driving With No Car Insurance? Here’s What It’ll Cost You ]

    If you are caught driving without car insurance because you are involved in an accident, your consequences can become more severe. Rather than a small chance of a warning or a smaller fine, you are much more likely to have your car impounded, and you are likely to have your license suspended. What’s more is that at-fault drivers with no insurance become financially liable for a large variety of costs, especially if the other person in the accident carries none or very little uninsured motorist coverage. You could be forced to pay a large sum or declare bankruptcy.

    You may get some reprieve because other motorists carry coverage for underinsured or uninsured motorists. Still, given the high costs of medical bills and car repair, it’s unlikely to cover everything.

    How much car insurance is required?

    There are a few different aspects of the minimum coverage in each state. Nearly every state will require you to carry some bodily injury liability and property damage liability coverage since those two costs tend to be present in an accident. Most mandated state minimum insurance coverage is abbreviated to a set of three numbers like 25/50/25. The first number is the maximum payout for a single person’s bodily injury in an accident. The second number is the maximum for all individuals harmed per accident. And the third number is the maximum payout for property damage.

    Some states structure their minimum coverage to require personal injury protection, where each motorist files with their insurance for damages and medical expenses rather than assigning one motorist as at fault – these states are known as “no-fault states.” Other states have mandatory underinsured or uninsured motorist coverages.

    State Minimum Car Insurance Requirement
    Alabama 25/50/25
    Alaska 50/100/25
    Arizona 15/30/10
    Arkansas 25/50/25
    California 15/30/5
    Colorado 25/50/15
    Connecticut 25/50/20
    Delaware 25/50/10
    Florida 10/20/10
    Georgia 25/50/25
    Hawaii 20/40/10
    Idaho  25/50/15
    Illinois 25/50/20
    Indiana 25/50/25
    Iowa 20/40/15
    Kansas 25/50/25
    Kentucky 25/50/25
    Louisiana 15/30/25
    Maine 50/100/25
    Massachusetts 20/40/5
    Michigan 20/40/10
    Minnesota 30/60/10
    Mississippi 25/50/25
    Missouri 25/50/25
    Montana 25/50/20
    Nebraska 25/50/25
    Nevada 25/50/20
    New Hampshire 25/50/25, financial responsibility only
    New Jersey 15/30/5
    New Mexico 25/50/10
    New York 25/50/10
    North Carolina 30/60/25
    North Dakota 25/50/25
    Ohio 25/50/25
    Oklahoma 25/50/25
    Oregon 25/50/20
    Pennsylvania 15/30/5
    Rhode Island 25/50/25
    South Carolina 25/50/25
    South Dakota 25/50/25
    Tennessee 25/50/15
    Texas 30/60/25
    Utah 25/65/15
    Vermont 25/50/20
    Virginia 25/50/20
    Washington 25/50/10
    Washington D.C.  25/50/10
    West Virginia 25/50/25
    Wisconsin 25/50/10
    Wyoming 25/50/20

    Source: Insurance Information Institute

    We welcome your feedback on this article. Contact us at inquiries@thesimpledollar.com with comments or questions.

    Source: thesimpledollar.com

    What Can Go Wrong on Closing Day – and How to Prevent It

    Some surprises are great. An unexpected bonus or a hotel upgrade can make your day. But when it comes to closing on a home, a surprise is almost never a good thing.

    Paperwork tedium will give way to terror if there’s an unexpected delay in financing or error in a title document. But you can avoid closing problems and delays, or at lease minimize them, by understanding what might go wrong and monitoring it well ahead of your closing date.

    What happens at closing is the culmination of more than a month of gathering and preparing documents. For closing to go off without a glitch, your closing officer, your lender or loan officer and your real estate agent have to work together to get everything in order and processed correctly. These folks are professionals and they absolutely should know what they are doing. But they are also human beings working on a lot of files, not just yours.

    If your closing gets pushed back a day, that just means they do it on Tuesday instead of Monday. It really isn’t an emergency in their world. You, however, have a moving truck scheduled and deadline to vacate your current home. Your loan commitment has an expiration date and so does your escrow. All of this means it’s more critical to you than it is to anyone else to get the deal completed on time, so it’s wise for you to stay on top of things.

    With that in mind, here are a few common closing problems as well as ways to prevent them.

    Problem: Errors in documents

    One of the most common closing problems is an error in documents. It could be as simple as a misspelled name or transposed address number or as serious as an incorrect loan amount or missing pages. Either way, it could cause a delay of hours or even days.

    Prevention: Preview everything
    Go ahead and ask to see every piece of paperwork as far in advance as possible. Pay special attention to loan documents. By law, you will get your Loan Estimate and Closing Disclosure forms three days before closing. Look at them carefully and immediately. The sooner you spot a problem the faster you can get it fixed and keep your closing on track. If something seems odd or you just don’t understand it, this is the time to ask questions. Double-check the loan and down payment amounts, interest rates, spellings and all personal information.

    Problem: Mortgage delays and last-minute requests

    When you set a closing date and communicate that with your lender, you probably assume they will let you know in plenty of time if there are problems with meeting that deadline. You would be wrong. Understand that in a hot real estate buying or refinancing market, lenders can be inundated. Without periodic calls from you and your real estate agent, who also has a vested interest in closing the deal on time, your file could easily fall to the bottom of the pile while the loan officer deals with more urgent loans. By the time your loan is at the top of the priority list, it might be too late to get that missing document in time. Lenders sometimes ask for more information at the last minute – copies of a rental agreement, a canceled deposit check, the original hazard insurance payment – that can leave you scrambling and lead to closing delays.

    Prevention: Check in with everyone
    Early on, find out exactly what documents the lender needs to complete your file and write you loan. Between bank statements, tax returns and other documents, there are ample opportunities for items to go missing or be forgotten about until the last minute. Once you know what they need to write your loan, call or email periodically to make sure they have everything. (Your real estate agent may also be doing this so check with them as well.) How often? That depends on how much is missing from your file. But a weekly check-in isn’t out of hand until they confirm your file is complete. If there are problems or several missing documents, check in more often. Always make sure they are aware of your anticipated closing date.

    Several days before closing, check in with your closing agent to make sure they are in communication with your lender and that they have everything they need. If there is something you think they might possibly need but no one has mentioned it, bring it to the closing meeting.

    Problem: Cash flow

    You go to the bank the day before closing and arrange to have your down payment transferred directly to the closing agent. You’re good to go. Unless the transfer falls through due to some bug in the bank’s system and the money either doesn’t get there in time or what comes through is less than the amount you need.

    Prevention: Bring it

    You can avoid this issue entirely by bringing your down payment in the form of a certified or cashier’s check. (You can’t use a personal check, so don’t even try that.) Or, simply arrange the wire or bank transfer of funds so it reaches the closing agent a couple of days early. If you don’t yet know the exact amount needed at closing, have more than enough money transferred. You’ll get a refund later.

    Problem: Title isn’t exactly clear

    Maybe the title company discovers that the seller never paid the contractor for the backyard fence or hasn’t paid property taxes for five years and there is a lien on the property. Or perhaps the home is the subject of a lawsuit between bickering relatives. Interesting as that may be, the bottom line is that you, the buyer, have a problem. You need to insist on a clear, unclouded, problem-free title before closing. Your lender will insist on it, too.

    Prevention: Read the title report

    Shortly after escrow opened, the title company completed a preliminary title report. That often goes directly to your lender, but you can get a copy either from the title company or your lender. Get it as soon as possible and read it carefully. At closing you’ll buy title insurance to protect yourself in case the title company missed anything in its search, but that policy is only effective from the day of closing forward.

    Problem: Something’s amiss at your walk-through

    It’s the day before closing and you’re doing a final walk-through of what is almost your home. The seller has punched a hole in the wall and ripped down the fixtures they were supposed to leave.

    Prevention: Jump on it right now

    Your agent should work with the seller’s agent to solve the problems. First, figure out what’s acceptable, how much it might cost and how to make the seller pay. One way would be to negotiate a credit on your closing fees, meaning the seller pays more at closing. Another would be to have the appropriate amount from the seller’s proceeds placed in escrow until the problems are fixed.

    The point is, don’t wait until closing to bring up any issues. Get them resolved beforehand. If you can’t, you’ll have to postpone the closing while you work it out. In some cases, you may prefer to just accept responsibility for the problems rather than delay closing, but that’s up to you.

    Source: zillow.com

    Sell Your Flip Faster With These Expert Tips

    Time is money, so keep the profits coming with this advice from Christina El Moussa of HGTV’s “Flip or Flop.”

    If you’ve been flipping for a while, you know that selling a flipped house takes patience, and that some houses sell faster than others. While many factors affect how quickly a house sells, Success Path has three tips to help you sell your flipped houses faster.

    Make a good first impression

    Like a job interview, your house needs to make a good first impression. Regardless of how great it is on the inside, the outside appearance matters, and it can be the deciding factor for whether or not the potential buyer bothers to inquire further about the house.

    There are many ways to give your house a quick facelift:

    • Start with the house itself — add new paint to the shutters, trim, and front door for a quick and inexpensive fix.
    • If possible and necessary, replace windows and the front door, or add trim and shutters.
    • Make sure the roof, porch, and yard are clean and tidy.
    • Use an eye-catching and sophisticated mailbox that matches the style of the house.
    • Repair the driveway if necessary, filling in cracks and removing any weeds.
    • Add edging to create clean landscaping lines.
    • Keep the grass tidy and mowed, filling in any bare spots and removing weeds.
    • If you have a garden, consider adding an arbor as a focal point. If you don’t have a garden, place flower pots strategically on the edge of the driveway or the porch.

    Use the reach of social media

    Social media is no longer just a place to keep in touch with distant friends and family. It’s a powerful marketing tool for companies and a platform for connecting with customers — both current and potential.

    Most social media platforms have special tools for connecting with specific target markets, narrowing the demographics to match your product or service. Use these tools to your advantage! People spend a fair amount of time on social media, so why not put your house right in front of the people looking for a house?

    Start by posting on local real estate pages, or even create your own house-flipping page where you can create ads to show specifically to the demographic of your choice. Don’t wait for the right buyers to find your ad — let your ad find the right buyers.

    Don’t skimp on major improvements

    The ultimate goal may be making a profit, but you’ll quickly learn the hard way that cutting corners or trying to skip major improvements altogether will cost you more in the long run — and may ultimately put you in the red.

    If you’re flipping a house that needs a new roof, but you don’t have roofing experience, don’t ignore the roof or attempt to do it yourself. These things take time and money, and doing it yourself will likely result in costly mistakes. Buyers will look at the bones of the house, so if they see a shoddy roof job, poor plumbing, or major renovations done haphazardly, they’ll be turned off.

    Before you even buy a house to flip, budget for hiring out major renovations or projects. Even if the house you want to flip seems manageable for your skill set, always assume that you’ll discover hidden costs and jobs that require a professional.

    Don’t give your potential buyers any red flags. Be upfront about the renovations, particularly the ones done by a professional. Squashing their concerns will leave a good impression and ease their minds as they explore the rest of the house.

    Related:

    Note: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinion or position of Zillow.

    Source: zillow.com

    CFPB Mulls Fate of Trump-Era Mortgage Rules

    The Consumer Financial Protection Bureau has said that it is weighing whether to “revisit” the Seasoned QM and General QM rules, codified in December under the Trump administration. So reports CNBC.

    While the Mortgage Bankers Association head Robert Broeksmit said that the rules will help lenders offer mortgages to Black and Hispanic homebuyers, consumer advocates said the rules eliminate protections for borrowers established after the 2008 financial crisis.

    Boston College Law School professor Patricia McCoy called the CFPB’s move “a big deal.”

    Read the full article from CNBC.

    Source: themortgageleader.com

    7 Myths About Buying a Foreclosure Home That’ll Surprise Deal Seekers

    Considering buying a foreclosed home? Any home buyer looking to pay below market value should be paying attention to foreclosure listings. But the process of buying a repossessed home is full of misconceptions—and we’re here to help separate the false stereotypes from the reality.

    These are some common myths that need to be set straight.

    Myth 1: The house must be bought in cash

    That all depends on what stage a foreclosure property is in, says Bill Gassett with Re/Max Executive Realty in Hopkinton, MA. If the home is in pre-foreclosure or “short sale,” the buyer does not need to shell out an all-cash offer.

    “They can procure a mortgage just like any traditional sale,” Gassett says.

    If the bank sells a property at public auction, the mortgage holder usually does require that the home is bought with cash and mortgage contingencies are not allowed in the sale.

    If you don’t have a lot of cash on hand but know you’d like to buy a home in foreclosure, Bobbi Dempsey, author of “Idiot’s Guide to Buying Foreclosures,” suggests drawing from a line of credit obtained using current property.

    When the foreclosure is a bank-owned property, Gassett says the bank is usually actively looking for an end buyer.

    “The purchaser of a bank-owned property is almost always able to procure a mortgage as part of the contract with the bank,” he says.

    Myth 2: Buyers forfeit their right to have a home inspection

    Definitely not true! Buyers have the right to do a home inspection and ask for repairs, but banks or sellers aren’t required to make them, says Rob Jensen, broker and president of Rob Jensen Co., in Las Vegas. But home inspections are actually encouraged since nearly all banks sell their foreclosed homes in as-is condition, and want to avoid liability down the line.

    “It is common for structural, electrical, and plumbing issues that pertain to the safety and integrity of the home to be repaired, but there’s no guarantee,” says Jensen. “Every bank and every deal is different.” However, don’t count on the bank to fix those cosmetic issues.

    Jensen says paint, carpet stains, and other minor blemishes are not likely to be addressed.

    Buyers considering a foreclosure should make sure the sales contract has a contingency clause that requires a passing home inspection. This way, buyers can either choose to accept any issues with the home or back out of the contract.

    With courthouse sales, however, homes are sold as they are, with no inspection.

    Myth 3: Foreclosure homes require huge overhauls

    It’s incorrect to assume that all homes in foreclosure are in shoddy condition. A large percentage of foreclosures are the result of job loss, illness, death, divorce, or even fluctuations in the real estate market, which means many of these homes were well maintained and may need only minor touch-ups.

    “It quite often depends on the attitude of who last owned the property and whether or not they went out of their way to destroy the place,” says Jensen.

    Myth 4: Foreclosures sell at heavy discounts

    A common belief is that a foreclosure home will sell for at least half of its original value. But remember, the bank still wants to make a profit. Buying a foreclosure home can save you green, but the seller will hold out for the maximum price possible.

    Home buyers often make a beeline to foreclosures because they think they can get a home for pennies on the dollar. But, Jensen says, by the time they factor in the time and renovation costs, they may reconsider.

    “Foreclosures can provide opportunity to save, but you usually need time and extra cash to take advantage of it,” he says.

    Myth 5: Foreclosure homes carry hidden costs

    The fear of hidden costs may send would-be buyers running, but it’s not necessarily a worthwhile concern.

    “A lot of the costs involved are typical for any real estate purchase—things like inspections, appraisals, transfer fees, etc.,” says Dempsey.

    Yes, repairs or liens on a foreclosure can prove costly, but a home inspection will reveal any potential problems during escrow (this is where that inspection contingency comes in handy).

    Also, the property deed can be researched on a foreclosed home. And, buying a HUD home or REO (or real estate–owned property) means the Department of Housing and Urban Development is required to clear the title of liens before it resells the home. Lenders will usually clear them, too, but buyers should make sure of that before they purchase.

    “Generally speaking, there are not any more hidden expenses in purchasing a foreclosed home than there would be in a traditional sale,” says Gassett.

    Myth 6: Foreclosures lose value faster than regular homes

    Foreclosed homes actually tend to rise quickly in value. With any home, there’s no guarantee it will deliver increases, but buying a foreclosure sold below market value can provide instant equity. And any extra work done to the home can only increase the value.

    “There are a variety of factors that influence home values, including economic conditions, local market conditions, and the overall condition of the property,” says Andrew Leff, senior vice president and head of strategic alliance programs at Wells Fargo in New York City.

    Myth 7: Buying a foreclosure is risky

    Let’s be honest. Any real estate purchase comes with risk. Gassett says the only scenario where there’s some extreme risk is when buying at auction, since you are buying the property as is. Buyers are not able to conduct a professional home inspection and often not even able to see the inside of the property. Plus, they will be inheriting whatever came with the home.

    “For example, if there is a lien on the property, you could become responsible for it. When buying a home at auction, it is essential to do a title search first,” says Gassett.

    Leff says buyers should be informed before entering into any type of real estate transaction. This means aligning themselves with resources that can help them navigate the purchase and financing process with confidence.

    “A knowledgeable real estate agent and lender can help ensure that a buyer is making an educated decision so that the property and any resulting financing is the right fit for them,” says Leff.

    Source: realtor.com