Homeowner Advice

We encourage you to use the Homeowner's Advice blog to educate you on the benefits and challenges of home ownership. If you have any questions, please contact me directly!

Buy It, Don’t Blow It

January 5, 2018 by

You have found your dream house and the sellers have accepted your offer. It may seem like blue skies with nothing to do but pack and wait for the keys to the front door. However, be aware that there are still pitfalls to avoid so you don’t blow the deal before your closing date.

Be diligent about keeping your financial situation stable. It used to be that your credit history was reviewed only before you received approval for your loan. Nowadays underwriters check again just a couple of days before closing to make sure that you haven’t accrued any new debts or credit problems.

Your credit score played a significant part in securing your mortgage loan, so don’t do anything to jeopardize your score during the weeks before closing. Don’t apply for new lines of credit or deplete your cash reserves for other big purchases, such as a car or new furniture. Be up-to-date with your monthly bill payments as well. Anything that can make your credit score drop could send red flag to your lender. You don’t want to give them any reason to rethink your loan.

There will be a lot of paperwork involved in finalizing your loan and accidental errors are always a possibility. Be very prompt with any requests from your lender for additional documents. Incorrect or missing documents will cause delays in your closing or even halt it completely.

Home inspections will be done prior to closing. You want a thorough inspection that will uncover significant problems with the property. This is not an opportunity to nitpick every flaw and make unreasonable demands from the seller. Inspections are made for your protection as the buyer. Faulty wiring or termite damage are problems that likely need to be addressed before the sale is complete. However, quibbling over small flaws in the paint or a chipped sink or similar cosmetic problems may just aggravate the sellers without any benefit to you. Keep in mind that you may require some accommodation from the sellers before signing the final paperwork. For example, you might need some extra time before closing and want to move the date back a couple of days. This happens frequently. The sellers may be less willing to cooperate if you have turned inspection results into an unpleasant confrontation.

Finally, once your offer has been accepted and your closing has been scheduled, stop looking at other homes for sale. Yes, it is tempting to keep checking on what else has come on the market. But you might end up with a raging case of premature buyer’s remorse. Don’t worry that another house is better than the one you chose. You loved the house when you made the offer and you have a legally binding contract with earnest money paid toward that purchase. Now is the time to make plans for your new house: choose paint colors, make furniture placement diagrams and let the kids decide which bedrooms they want. Be patient and pack. Moving day will come before you know it.

A Packing Tip Sheet

November 15, 2017 by

“Moving is easy and packing is fun,” said nobody ever! Packing up everything you own is stressful and tedious, so follow a few simple tips to make your move more streamlined.

Give yourself time

Packing can be overwhelming, so pace yourself to help keep things organized. Pack non-essential or off-season items weeks before your move. Books, knick-knacks, framed art and anything else you won’t use until you are in your new home can all be packed early. Eliminate some of the stress by packing a little bit at a time.

Downsize and donate

Now is the time for cleaning out closets, cupboards, the attic, basement and garage. Be ruthless! Donate or toss everything you don’t use. The more you get rid of, the less you have to pack, move and organize in your new home.

Stock up on moving supplies

Sometimes boxes from grocery or liquor stores work well and they don’t cost you anything. However, they may not be clean or hold the weight of your items and many different sizes of boxes are harder to stack in a moving truck. Use boxes designed for moving when necessary. Keep items clean by using white packing paper. Newsprint may work for some things, but the ink can smear on other pieces. Get plenty of packing tape and markers. You will probably need more than you think you do.

Label each box carefully

Unpacking is harder than packing because you have to decide where everything goes in your new place. Give yourself a break by labeling boxes clearly with their contents and destination. For example, “Kitchen: Dishes and Glasses” or “Master Bedroom: Shoes and Purses.” Label the tops and sides of the boxes and be sure to mark “Fragile” when appropriate.

Keep “just in case” items handy

Don’t pack all your tools. You might need a screwdriver for taking the mirror off the dresser and other possible last minute projects. You’ll need them at your new home, too, along with light bulbs, extension cords and power strips. Make a complete “just in case” list and keep those items handy.

Keep essential items close, too

There are several things you will need immediately at the new house. These include toilet paper, hand soap, bed linens, cleaning supplies and anything else you will want your first night at the new house. Snacks and medications should be handy, as well as a small first aid kit. You might want to pack these in a clear plastic box so they stay in plain sight.

Don’t ship everything with the movers

Transport legal documents and other important papers yourself. You might also choose to move heirlooms or precious breakables in your own vehicle. There are some things that you actually can’t move, so review the rules about what you can’t pack in a moving van. Some common household chemicals can’t be shipped because they are hazardous or flammable.

Pack an overnight bag

Everyone in your family needs pajamas, clean underwear and a change of clothes, along with basic toiletries and other essentials. You will probably be too tired to unpack everything, so keep the overnight bag in your car until you need it. Make the beds, go out to eat and get a good night’s sleep before tackling the unpacking in the morning.

The Highest Price May Not Be the Best

October 30, 2017 by

Much of the country is currently experiencing a strong sellers’ market. Homes are moving quickly and it’s quite likely a property may receive multiple offers. This is a strong position for you if you have your home on the market, but you need to be wise when judging which offer is actually the best one.

It is natural to want to take the highest price, but be smart and look at the whole offer to judge if it is really the best option. You want an offer that has a good chance of closing successfully and is not weighed down by unreasonable or undesirable contingencies.

Take this scenario, for example: One offer is $5,000 above the next, but includes a contingency for inspections and mortgage appraisal. The buyer making the second offer has conducted a pre-inspection and is willing to take the home as-is and waive the appraisal. You may decide the $5,000 difference is not worth the potential problems and take the second offer.

Another example: one offer is considerably higher, but is only putting down 5%. A lower offer that includes 20% down may be the better choice for you. A low down payment can mean the buyers are not really serious about your house and will pull out of the deal if they find something they like better.

Perhaps you receive one offer with conventional financing and another a few thousand dollars higher with FHA financing. This may be significant to your decision especially if you are in a hurry to close the deal because of a job transfer or other reasons. FHA loans have more stringent guidelines than traditional loans and therefore more risk for slower closing dates. It might be better to take the lower offer to dodge potential complications.

You want to avoid accepting any offer with risks that it could backfire. If your buyers get cold feet after your house has been off the market for several days, you are back to square one. The next buyers in line will assume something is wrong and momentum for selling your home could be stalled.

The following sliding scale is a good illustration of the worst to the best scenarios you could expect if multiple buyers offer the SAME price for your home:

All cash, no contingencies
All cash, pre-inspected
Big down payment, inspection & appraisal waived
Big down payment but contingent on inspection and other contingencies
Contingent on low down payment, inspection, appraisal, title & HOA review, low earnest money and asking for closing costs

As always, count on your agent to help you evaluate the strength of each offer you receive. Enjoy being in the driver’s seat while selling your home in this competitive market. The tables may turn as you begin the search for your next house!

Home Buying for Seniors – Considerations for Finding Just the Right Fit

September 15, 2017 by

There are multiple aspects to consider when a senior looks for a new home in their older years. Their priorities in a home will likely be very different compared to what was ideal years ago, and there may be some financing challenges to work through. Navigating the process can seem challenging, but there are some ways to make it a bit easier.

Create a Priority List

A senior should create a priority list before starting the search for a new place. For many older adults, one-level living is important as stairs can become challenging. Natural light and an open floor plan are important to many seniors, and don’t forget to look at the kitchen, bedroom, and bathroom closely to ensure they will be easily accessible.

Seniors are often downsizing to a smaller place at this stage of life, but they should consider whether extra space is needed for storage or guests. If the new home will be in a retirement community or assisted living facility, consider the community amenities and other potential resources. Look at both the individual unit and the community spaces, and think about what may be needed in the years to come (not just right now).

Consider Budget and Options for Accessing Equity

Prior to purchasing a new home, a senior will need to consider what they can afford. Many seniors are on a limited budget, and it is vital they keep enough money accessible to live comfortably day-to-day. Not only do they need to account for monthly expenses, but they should also build a reserve for emergency repairs or future health issues.

Some seniors decide to make a large down payment on their home, perhaps using equity from the sale of their previous home. As the FDIC explains, there are ways older adults can utilize equity in their new home in order to have access to cash. Some do a reverse mortgage, called a Home Equity Conversion Mortgage, while others get a home equity line-of-credit or second mortgage.

Transfer of Property to Adult Children

A quitclaim deed can be useful for many seniors and their families. Realtor.com defines a quitclaim deed as “a legal document that transfers any ownership claim, interest, right or title a person or entity may have in a property to someone else. In effect, it releases (or quits) any ownership claims a person may have in a piece of property.” Seniors often find this to be an inexpensive way to grant ownership of a home to another family member rather than sell the property.

Investopedia recommends that seniors only use this option to transfer property to someone they know and trust, such as a situation involving an older parent and adult children. However, families need to recognize that this does not transfer a mortgage, only ownership rights. If there is a mortgage on the property, additional steps will need to be taken to assume the mortgage or refinance.

Focus on Reputable Options for Professional Movers

When moving day arrives, many seniors will want to hire professionals for assistance. Moving can get expensive with hired movers, so it may be best to go with a proven entity rather than someone unknown. Ask around for recommendations – senior centers can be a great resource for finding movers experienced in these types of relocations.

Prioritizing what a senior needs in a new home can be tricky, and older adults sometimes need to utilize special options such as a quitclaim deed or reverse mortgages to make the financial aspects fit properly. However, with some strategizing, a senior can settle comfortably into a new home that brings them peace and tranquility for their remaining years.

Jim Vogel, co-founder of ElderAction, is passionate about promoting senior health and safety. He enjoys sharing valuable information with seniors and their caregivers. He focuses on helping ensure seniors are able to thrive throughout their golden years by sharing pertinent resources and information. He works with his wife, Caroline, to provide useful resources to aging seniors and their caregivers.

Falling in Love with a Money Pit

August 15, 2017 by engageRE

There are many of us who dream of owning an older home, full of charm and personality. We imagine gorgeous woodwork, wrap-around porches, arched doorways, ornate fireplaces and sweeping carved staircases. All those hopes may come true, but be careful to evaluate the work and expense that can go along with owning an old house.

Talk to your real estate agent about getting a very thorough inspection. Some experts even recommend two inspections for an older property because there can be so many hidden problems. You want to be in a position to negotiate repairs in case significant or dangerous problems are discovered. Here are some possible pitfalls to anticipate.

Foundation and Structural Issues

Even meticulously built homes can shift over time, causing cracks in foundations and walls. Doors and windows may jam; chimneys may need realignment and stonework might need attention. Moisture creeping in over time can cause dry rot or corrosion, which can lead to mold or mildew. Old homes have a high risk of termite damage which can devastate floors, structural supports and drywall. All these repairs can be extremely expensive and homeowners insurance likely will not cover the cost.

Hazardous Materials

If the house was built before 1978, it likely contains lead paint inside and out. Professional paint removers can be hired if you are uncomfortable living with lead paint, especially if you have young children. Old lead pipes pose another issue. A water filtration system for the entire house or at least the kitchen faucet is the most cost-effective fix, but you might be faced with replacing all your pipes.

Asbestos was commonly used in insulation and fireproofing material until the mid-1970’s. Old popcorn ceilings probably contain asbestos, too. Removal costs vary greatly depending on the size of the project. If you are planning to remodel, asbestos removal is recommended.

Unsafe Electrical System

Find out the age of the home’s electrical system. If it is still the original knob-and-tube wiring, you should get a quote to replace it. Insulation for the wiring needs to be intact and the electrical panel and circuit breakers should be up-to-date. If the original wiring has already been replaced, it must be up to code to be safe and efficient. Check for code with updated plumbing as well.

Old Appliances and Mechanics

Kitchen and laundry room appliances, air conditioning systems, furnaces and water heaters all have an expected lifespan. Check the age of every unit to determine how much longer it should be operational so you can create a reasonable replacement schedule. Figure that into your household budget for the coming years if you decide to purchase the home.

Trees, Leaves and Roots

The beauty of a long-established neighborhood is usually a big plus when buying an older home. Towering trees and mature flowering shrubbery have great appeal, but keep in mind the price that comes with them. Trees need to be trimmed regularly or you risk dramatic problems when they are covered with ice in the winter. Autumn brings bushels of leaves to be removed. Old, tall trees have long roots that can crack foundations and sidewalks or grow into plumbing systems. All of this is costly.

Good News

The caution here is simply to be aware of hidden costs when you find your perfect antique dream house. There are plenty of excellent reasons to buy. Older homes are frequently in wonderful locations close to downtown cores. You are likely to find a long-established, close-knit community with lots of history. There is a good possibility that you will find craftsman-quality construction in the architectural features you admire. You also have a good chance for building equity with a strong long-term investment, if the upkeep isn’t too steep. Old houses are in limited supply and if you have a gem in a desired part of town, it will likely always be in demand when you decide to sell.

Reduce the Stress of Selling

July 15, 2017 by engageRE

There are many unavoidable tasks to tackle as you prepare to sell your home and move. However, you can reduce some of the stress with this checklist. Use it as a guide to avoid over-thinking and over-doing a few things. You’ve got enough to do already!

First: Hire an Agent

You want to get the best price for your home and there are plenty of potential pitfalls before reaching that goal. A good agent will help you set the right price, handle marketing, manage negotiations and guide you through all the necessary paperwork. You will increase your chance for a quick sale with an agent working for you, so hire a well qualified person and listen to their advice. Let your agent shoulder some of the stress.

Restrain Your Urge to Decorate

A few strategic changes to your home may really boost your asking-price, but don’t overdo it. Replacing worn carpet and paint are good ideas, but choose neutral colors even if that may not be your taste. You might love a Southwest motif, but your potential buyers might flinch. Going neutral with everything as you prepare for a sale should make decorating decisions easier.

Don’t Over Do Improvements

Again, there are changes you can make that will help your house sell, but don’t worry about the small stuff. You might opt to replace outdated appliances or broken door hinges. Concentrate on necessary fixes, but don’t overdue it. There are plenty of repairs that you could make that will neither increase the home’s value nor accelerate the sale. Be sure to ask your REALTOR^® what you should fix and what you should ignore before your house goes on the market.

Start Packing to Eliminate Clutter

Reducing the clutter around your house is a stress reliever because it helps get part of your packing done. This is your chance to weed out items you don’t want to keep: donate some, recycle others and toss the rest. A thorough clutter reduction before the house goes on the market will make it easier for you to do a quick clean up before each showing, too.

It’s Not Personal

When your house is for sale, you need to think like a business person and not a home owner. That means having a thick skin when prospective buyers are judging the pros and cons of your place. Of course, you have lots of emotion, memories and dreams tied up in your home. You need to put all that aside and distance yourself during the sale. Don’t feel badly if potential buyers complain about your choice of draperies or talk about digging up your rose bushes. Just get the house sold and then make plans for your next garden.

Don’t Stick Around

Get the entire family out the door when a showing is scheduled, including pets if possible. Buyers need to be able to imagine themselves in your home and that’s difficult if you are there. Refer back to the “It’s Not Personal” item above. They will likely say things that could hurt your feelings, so don’t stick around to hear their discussion. Avoid this stress, leave the house, and at the very least wait in the backyard while they are there.

Moving is a hard task and you want to get the sale completed quickly. Remove the stressors where you can. Before you know it, you’ll be handed the keys to your new dream house and be ready to start your next chapter.