Southeast Florida Real Estate News

 

April 30, 2019

A Guide to Mortgage Interest Rates: Why They Go Down and Up, and What to Do

finance concept

Mortgage interest rates are a mystery to many of us—whether you're a home buyer in need of a home loan for your first house or your fifth.

After all, what does “interest rate” even mean? Why do rates swing up and down? And, most important, how do you nab the best interest rate—the one that’s going to save you the most money over the life of your mortgage?

Here, we outline what you need to know about interest rates before applying for a mortgage.

Why does my interest rate matter?

Mortgage lenders don't just loan you money because they’re good guys—they’re there to make a profit. “Interest” is the extra fee you pay your lender for loaning you the cash you need to buy a home.

Your interest payment is calculated as a percentage of your total loan amount. For example, let’s say you get a 30-year, $200,000 loan with a 4% interest rate. Over 30 years, you would end up paying back not only that $200,000, but an extra $143,739 in interest. Month to month, your mortgage payments would amount to about $955. However, your mortgage payments will end up higher or lower depending on the interest rate you get.

Why do interest rates fluctuate?

Mortgage rates can change daily depending on how the U.S. economy is performing, says Jack Guttentag, author of “The Mortgage Encyclopedia.”

Consumer confidence, reports on employment, fluctuations in home sales (i.e., the law of supply and demand), and other economic factors all influence interest rates.

“During a period of slack economic activity, [the Federal Reserve] will provide more funding and interest rates will go down,” Guttentag explains. Conversely, “when the economy heats up and there’s a fear of inflation, [the Fed] will restrict funding and interest rates will go up.”

How do I lock in my interest rate?

A “rate lock” is a commitment by a lender to give you a home loan at a specific interest rate, provided you close on your home in a certain period of time—typically 30 days from when you're pre-approved for your loan.

A rate lock offers protection against fluctuating interest rates—useful considering that even a quarter of a percentage point can take a huge bite out of your housing budget over time. A rate lock offers borrowers peace of mind: No matter how wildly interest rates fluctuate, once you're "locked in" you know what monthly mortgage payments you'll need to make on your home, enabling you to plan your long-term finances.

Naturally, many home buyers obsess over the best time to lock in a mortgage rate, worried that they'll pull the trigger right before rates sink even lower.

Unfortunately, no lender has a crystal ball that shows where mortgage rates are going. It’s impossible to predict exactly where the economy will move in the future. So, don't get too caught up with minor ups and downs. A bigger question to consider when locking in your interest rate is where you are in the process of finding a home.

Most mortgage experts suggest locking in a rate once you're "under contract" on a home—meaning you've made an offer that's been accepted. Most lenders will offer a 30-day rate lock at no charge to you—and many will extend rate locks to 45 days as a courtesy to keep your business.

Some lenders offer rate locks with a “float-down option,” which allows you to get a lower interest rate if rates go down. However, the terms, conditions, and costs of this option vary from lender to lender.

How do I get the best interest rate?

Mortgage rates vary depending on a borrower’s personal finances. Specifically, these six key factors will affect the rate you qualify for:

  1. Credit score: When you apply for a mortgage to buy a home, lenders want some reassurance you’ll repay them later! One way they assess this is by scrutinizing your credit score—the numerical representation of your track record of paying off your debts, from credit cards to college loans. Lenders use your credit score to predict how reliable you’ll be in paying your home loan, says Bill Hardekopf, a credit expert at LowCards.com. A perfect credit score is 850, a good score is from 700 to 759, and a fair score is from 650 to 699. Generally, borrowers with higher credit scores receive lower interest rates than borrowers with lower credit scores.
  2. Loan amount and down payment: If you're willing and able to make a large down payment on a home, lenders assume less risk and will offer you a better rate. If you don’t have enough money to put down 20% on your mortgage, you’ll probably have to pay private mortgage insurance, or PMI, an extra monthly fee meant to mitigate the risk to the lender that you might default on your loan. PMI ranges from about 0.3% to 1.15% of your home loan.
  3. Home location: The strength of your local housing market can drive interest rates up, or down.
  4. Loan type: Your rate will depend on what type of loan you choose. The most common type is a conventional mortgage, aimed at borrowers who have well-established credit, solid assets, and steady income. If your finances aren't in great shape, you may be able to qualify for a Federal Housing Administration loan, a government-backed loan that requires a low down payment of 3.5%. There are also U.S. Department of Veterans Affairs loans, available to active or retired military personnel, and U.S. Department of Agriculture Rural Development loans, available to Americans with low to moderate incomes who want to buy a home in a rural area.
  5. Loan term: Typically, shorter-term loans have lower interest rates—and lower overall costs—but they also have larger monthly payments.
  6. Type of interest rate: Rates depend on whether you get a fixed-rate mortgage or an adjustable-rate mortgage, or ARM. "Fixed-rate" means the interest rate you pay remains fixed at the same level throughout the life of your loan. An ARM is a loan that starts out at a fixed, predetermined interest rate, but the rate adjusts after a specified initial period (usually three, five, seven, or 10 years) based on market indexes.

Article Courtesy Realtor.com

Posted in Market Updates, News
March 14, 2019

What is Estate Planning? And Why Is It So Important?

As a real estate professional who handles probate sales, I have seen first hand the difficult situation and lengthy process families have endured because they were not prepared with an estate plan. Simply stated, estate planning helps protect your family in the event that something bad happens to you. And yet, 55% of Americans do not have a last will, leaving them vulnerable to costly court fees and legal battles. Estate planning is one of the most important steps any person can take to make sure that their final property and health care wishes are honored, and that loved ones are provided for in their absence. A comprehensive estate plan can resolve a number of legal questions that arise whenever anyone dies: What is the state of their financial affairs? What real and personal property do they own? Who gets what? Does a personal guardian need to be appointed to care for minor children? How much tax will need to be paid in order to transfer property ownership? What funeral arrangements are appropriate?

Here is a list of items every estate plan should include:

Last Will and Testament: A legal document by which a person expresses their wishes as to how their property is to be distributed at death, and names one or more persons, the executor, to manage the estate until its final distribution.

Durable Power of Attorney: A legal document that gives another person full or limited legal authority to sign your name on your behalf in your absence. Valid through incapacity. Ends at death.

Health Care Surrogate: A legal document that lets you give someone else the authority to make health care decisions for you in the event you are unable to make them for yourself.

Living Will Declaration: A written document that details your desires regarding your medical treatment in circumstances in which you are no longer able to express informed consent, especially an advance directive.

Designation of Preneed Guardian: A legal document that states if you should you ever become incompetent so that a court needs to appoint a legal guardian for you, you wish for the court to appoint the persons you have designated.

Image result for digital assets

Here are four steps to be prepared: 

1. Be aware. Speak regularly with your attorney about how to protect your digital assets.

2. Take a digital inventory. At least once a year, make a list of all your online accounts and subscriptions.

3. Gather your passwords. Make a list of your current passwords and keep it in a safe place. Make sure your trustee knows where to find the list.

4. Be specific. It's essential that your durable power of attorney include specific provisions authorizing someone you trust to deal with your digital online accounts. Your will or revocable trust should have similar provisions to allow your loved ones to deal with those assets after your death.

Even though it'd predicated on incapacitation or death, estate planning doesn't have to be morbid. In fact, it can actually be life-affirming, because the process will allow you to take a closer look at the people you care about in life and ensure their future happiness.

Article Courtesy Diana Fairbanks

Posted in News
March 13, 2019

Check Yourself Before You Wreck It Yourself: 8 Tips for a DIY Demolition Party

demo-party

Thrifty homeowners know the value of sharing the load, such as banding together to rent a snowblower or throwing a blockwide garage sale. But would you ever ask your neighbors and friends to help you remodel your house?

That's exactly what Jamie Novak and her husband did eight years ago, when they called on family and friends for help to demo their condo kitchen.

"It was built in 1960, so the wallpaper, Formica cabinets, and vinyl floor had to go," she explains. And by not outsourcing the demolition, they saved some major cash.

It might seem like a scary endeavor to have a whole group of amateurs whacking the walls of your home. But it can also be liberating. Novak, for one, is extremely proud that everything was worked on by her, her husband, or a friend.

But she does offer a few caveats. "Write out a plan, a budget, and a timeline—and then add 20% to it," she advises. (Her DIY demo took longer and actually cost a little more than she expected.)

If you're feeling up to the challenge, you, too, can throw your own home demolition party that's fun and productive. Just keep in mind these eight crucial things before any of you swings a sledgehammer.

1. Check your insurance

Before you even create that event invitation, check the fine print in your insurance policy.

"It's best to know what your policy covers in case one of your neighbor's properties gets damaged or if you were to damage underground city utilities," explains Andrew Hecox of Air Capital Roofing.

And note whether personal liability coverage is included for medical expenses, pain and suffering, and lost benefits—in case one of your guests gets injured. Not sure about the details? Call your agent.

"Oftentimes you can get an umbrella insurance policy added to your current one if you're not completely covered, for that extra peace of mind," he adds. And have a frank talk with your friends about their ability to get down and dirty with the proposed demolition task.

2. Choose the right project

Of course, not every home demo lends itself to the DIY approach. If you're looking for an easy project to tackle, homeowners with limited experience can handle the removal of an old deck, screen porch, or kitchen cabinets, says Kevin Busch, vice present of operations at Mr. Handyman.

"But steer clear of projects requiring a licensed tradesperson, such as electrical wiring, plumbing, and HVAC," he notes. Also off the table: window replacement, roof repair, and attic insulation.

Hecox warns DIYers to avoid taking down load-bearing walls and to skip anything concrete-related.

"I would avoid these unless you are comfortable operating heavy equipment or have experience with a small Bobcat," he cautions.

3. Turn off the power (seriously, don't forget this step)

Always be sure gas, electricity, and water are turned off or capped before beginning any project that touches on these utilities. You should also call 811 to have someone mark underground wires on your property before you dig, Hecox says.

4. Don the right safety gear

No shoes, no shirt—big problem. Urge your helpers to wear work clothes and heavy-duty boots, and then be ready to provide the rest, including safety goggles, gloves, and dust masks.

"You'll also need a first-aid kit and plenty of hydration on site, especially if the weather is warm," Hecox says.

If you're hosting a demolition party, Busch says to protect your rooms, too. Contain dust, debris, drips, and damage by using dropcloths and hanging plastic sheets, he recommends. And don't forget to rent a dumpster for larger projects.

One caveat: If your home was built before 1978, it's best to consult with a professional before you invite people over to tear things up. It's possible there might be lead-based paint or asbestos lurking in your walls or ceiling, and professionals should be the ones to handle this high-risk material.

5. Gather these tools...

Depending on your project, you'll want to have enough hammers, nail bars, crowbars, sledgehammers, cordless drills, and utility knives or box cutters on hand. And don't forget a wheelbarrow and empty buckets for hauling debris, industrial-strength garbage bags, and brooms, Hecox recommends.

6. ... but skip others

When it comes to power tools—including jackhammers and all manner of saws (chain, reciprocating, circular)—be very careful. Unless your friends are familiar with these, stick with a more basic toolbox.

"If someone in your crew has never even used a handheld, cordless drill, they are not a candidate for these other items," Busch says.

7. Clean up debris

Keep in mind that most residential trash pickup is not suited to large amounts of drywall, wood, and nails. And whatever you do discard—strive to be eco-friendly about it.

For example, always separate metals from wood and find out if your municipality has shingle recycling, Hecox says. Some companies will grind up asphalt roofing, which can be used to make more shingles or blacktop for roads.

8. Reward your crew

If it's hot out, have plenty of (nonalcoholic) drinks on hand, and if it's cold, consider a small fire pit off to the side for quick warmup breaks, Hecox suggests. And at the end of the day, cold brews and pizzas will go a long way toward thanking your DIY team.

Article courtesy of Realtor.com

Posted in News
March 8, 2019

Home Seller Secrets: 'The Best Home-Staging Advice I've Heard, Ever'

room-staging-tips

When it comes to selling a house, appearances are everything. That's why more and more homeowners hoping to impress buyers are investing in home staging. But between decluttering, styling, and making your house look its absolute best, this process can make you want to pull your hair out.

To make this undertaking a little easier, we asked sellers for their very best home-staging advice, and then compiled their greatest tips. If you're getting ready to put your house on the market, use these pointers to spruce things up in a jiffy—and help buyers fall in love with your home.

Keep your home tidy 24/7

"When showing a house, I've learned it’s so important to keep your home tidy with all your possessions stowed away for two reasons. First, you don’t always know who’s walking through your house, and the listing agent can’t be in every room to watch your valuables. I had a brand-new bottle of Chanel perfume in one of my bathrooms, and one day I came home after a showing and it was gone. Second, a tidy house looks better. You want potential buyers to come in and see a beautiful dream home, not your clutter. You never know when a potential buyer will want a last-minute tour, so put away your dishes as soon as you're done eating, pick up dirty clothes on the floor, and make your bed every morning." – Jennifer Davis, homeowner in St. Louis, MO

Invest in a few trendy items

"Before showing, you should update your house with a few new, stylish pieces to make it more on-trend. Look on Pinterest to see what's fashionable right now, or tour open homes to see how they’re staged. Then, re-create the look. Don’t worry, you can do this while being budget-friendly! When we were selling our house, we ended up investing in a few pieces—a new duvet cover, some curtains, and some wall hangings—to make our home look more like other houses that were on the market. All this stuff only cost us a couple of hundred dollars, but we got a lot of compliments on our style and, in the end, our house sold for more than we expected. Remember that spending a few hundred on décor could end up getting you thousands in the end." – Cassidy Carr, homeowner in Provo, UT

Make your home feel like their home

"The best home-staging wisdom I've heard is that potential buyers need to see themselves in your home. That’s why real estate agents tell you to clear out any personal pictures you have on the walls. You don’t want buyers to think of it as your house, because it’ll make it harder for them to picture themselves living there. For that same reason, try your best not to be home when your house is being toured. If buyers see you, they’ll remember that they're guests.

"And unless you feel very strongly about people taking their shoes off, remember that you're moving, so it doesn’t really matter if people are tracking in dirt. When buyers are told to take their shoes off in a home, they’re reminded that someone else lives here, and it makes it harder for them to see themselves living in that house. Plus, for some people it’s awkward to walk around in their socks, and you don’t want potential buyers to feel uncomfortable." – Anne Andrews, homeowner in San Juan Capistrano, CA

Spray a clean, simple scent

"You can absolutely kill a person's interest by showing them a house that smells like dirty teenagers and smelly dogs. Houses need to smell fresh and clean, but shouldn’t smell like chemicals. Invest in a really good home fragrance spray with a soft scent, like lavender or fresh linen." – Ashley Matthews, homeowner in New York, NY

Don't try to hide your clutter

"It's common to use the garage as a place to stash the boxes you've cleared out of your home for a showing. However, you still want the garage to look presentable. People want to see the entire house, so take this opportunity to clear it out. Buyers will also open closets. They’re not trying to be invasive—they just want to see how much space you have. Don't think you can cram everything behind those doors and it'll be invisible. People will look through everything, and when they do open closet doors, they probably won’t appreciate being met with an avalanche of stuff. In fact, it will probably make them think your house doesn’t have enough storage, and they’ll move onto the next." – Linda Roberts, homeowner in Mission Viejo, CA

Get your pets out of the house

"The best advice I got before selling my home was to make sure that both buyers and my pets feel comfortable. Meeting someone else’s animals can be stressful. Pets might be protective of their turf, so owners should consider taking them somewhere else during showings. If you’re having an open house, bring your pet to a friend’s house for the day. If someone is coming over for a tour, take that opportunity to walk your dog. However, if you must leave your pets at home, always make sure you leave instructions on how to handle them. Give your listing agent instructions on where to put dogs if they get rowdy (like a guest room), but don’t just assume you can just put your pets in the backyard, because buyers want to see the outdoor space too." – Leanne Logan, homeowner in Hershey, PA

Article courtesy Realtor.com

Posted in Market Updates
March 2, 2019

5 Sweet Tax Deductions When Selling a Home: Did You Take Them All?

selling-deductions

You may be wondering if there are tax deductions when selling a home. And the answer is: You bet!

But there's also a new tax code—aka the Tax Cuts and Jobs Act—causing quite a bit of confusion this filing season. Rest assured that if you sold your home last year (or are planning to in the future), the tax deductions may amount to sizable savings when you file with the IRS.

 

You'll want to know all the tax deductions (as well as tax exemptions or other write-offs) at your disposal. So here's a rundown.

1. Selling costs

Good news! These deductions are still allowed under the new tax law as long as they are directly tied to the sale of the home and a married couple—or a single taxpayer—lived in the home for at least two out of the five years preceding the sale. Another caveat: The home must be a principal residence and not an investment property.

“You can deduct any costs associated with selling the home—including legal fees, escrow fees, advertising costs, and real estate agent commissions,” says Joshua Zimmelman, president of Westwood Tax and Consulting in Rockville Center, NY.

This could also include home staging fees, according to Thomas J. Williams, a tax accountant who operates Your Small Biz Accountant in Kissimmee, FL.

Just remember that you can’t deduct these costs in the same way as, say, mortgage interest. Instead, you subtract them from the sales price of your home, which in turn positively affects your capital gains tax.

2. Home improvements and repairs

Score again. The new tax law left this deduction as well. If you renovated a few rooms to make your home more marketable (and so you can fetch a higher sales price), now you can deduct those upgrade costs as well. This includes painting the house or repairing the roof or water heater.

But there’s a catch, and it all boils down to timing.

“If you needed to make home improvements in order to sell your home, you can deduct those expenses as selling costs as long as they were made within 90 days of the closing,” says Zimmelman.

3. Property taxes

This deduction is still allowed, but your total deductions are capped at $10,000, Zimmelman says.

If you were dutifully paying your property taxes up to the point when you sold your home, you can deduct the amount you paid in property taxes this year up to $10,000.

4. Mortgage interest

As with property taxes, you can deduct the interest on your mortgage for the portion of the year you owned your home. However, the rules have changed slightly from last year.

Just remember that under the new tax code, new homeowners (and home sellers) can deduct the interest on up to only $750,000 of mortgage debt, though homeowners who got their mortgage before Dec. 15, 2017, can continue deducting up to the original amount up to $1 million, according to Zimmelman.

Note that the mortgage interest and property taxes are itemized deductions. This means that for it to work in your favor, all of your itemized deductions need to be greater than the new standard deduction, which the Tax Cuts and Jobs Act nearly doubled to $12,200 for individuals, $18,350 for heads of household, and $24,400 for married couples filing jointly (for comparison, it used to be $12,700 for married couples filing jointly).

5. But what's up with capital gains tax for sellers?

Lawmakers tried to change the capital gains rule, but it managed to survive—so it’s still one home sellers can use. It isn't technically a deduction (it's an exclusion), but you’re still going to like it.

As a reminder, capital gains are your profits from selling your home—whatever cash is left after paying off your expenses, plus any outstanding mortgage debt. And yes, these profits are taxed as income. But here's the good news: You can exclude up to $250,000 of the capital gains from the sale if you’re single, and $500,000 if married. The only big catch is you must have lived in your home at least two of the past five years.

However, look for the rules of this exemption to possibly change in a future tax bill.

Ralph DiBugnara, president of Home Qualified and vice president at Residential Home Funding, says lawmakers might push to change this so that homeowners would have to live in the property for five of the past eight years, instead of two out of five.

Article courtesy Realtor.com

Posted in News
Feb. 28, 2019

6 Things in Your Bathrooms That Are Freaking Out Potential Buyers

bathroom-turnoffs

Bathrooms are, by design, private spaces. After all, there's a door and a lock for a good reason.

But when your house hits the market, dozens of strangers will suddenly be tramping through your bathrooms—and everything that once felt so private will now become painfully public. And those strangers will be passing judgment on what they see.

True, the nose hair trimmer you accidentally left on the counter or pile of sweaty running socks forgotten behind the door might not be a deal breaker to a potential home buyer. But they certainly won't be forgotten.

Why chance it in the first place? We talked with the experts to lift the lid on the weirdest things buyers found in the bathroom during a home showing—some of which actually killed the sale.

1. Inappropriate art

When Elizabeth Williamsberg, a real estate and brand photographer in Boulder, CO, went into a quiet, suburban home to take photos, she didn’t register anything out of the ordinary.

Until she entered the half-bath.

“On the wall above the toilet was a 10-by-13 framed photo of a naked child peeing in an in-ground pool that we immediately recognized as the pool in their backyard,” Williamsberg recalls. “I ran out of the bathroom, and the real estate agent followed right behind me."

They called the homeowners to come over and immediately remove the photograph. Even weirder was the reason the photo was there.

“It turns out that it was the couple's now-adult son,” Williamsberg says. “The parents had placed it there when he was a teen to embarrass him when his friends came over. He'd long since moved out, and they had simply forgotten to remove it.”

Heads up: Your bathroom shouldn’t be an experimental art gallery. Remember: You want guests to imagine themselves living in your home, not picturing what went on before you got there.

2. Words

Justin M. Riordan, founder of Portland, OR–based Spade and Archer Design Agency, isn’t a fan of word art—and that opinion was only reinforced when he recently walked into a bathroom of a client’s home. Over the toilet was a poorly placed sign that read "DREAM BIG."

“They hung it in a bathroom and then proceeded to leave the toilet lid up. The story it tells the viewer is not too far off from a very effective Metamucil ad,” Riordan says.

Heads up: If you love word signage, no one's stopping you from putting it up throughout your house. But steer clear of the bathroom, where pretty much anything can turn into a poop joke.

3. Food storage

When Susanna Haynie, broker-owner of Co-Re Group in Colorado Springs, CO, took young, first-time home buyers to see a historic home, she expected some old-timey quirkiness. What she wasn't prepared for was the small fridge placed within reaching distance of the toilet.

"The combination of the two, next to each other, got my buyers rolling,” Haynie says.

The mysterious toilet fridge apparently wasn't a deal breaker—the couple ended up buying the house.

“But when my clients moved in, the fridge was removed,” Haynie says.

Heads up: Food storage only in the kitchen, please. And if there's anything else in your bathroom that belongs in your kitchen, be it a microwave or your collection of spatulas, please put them back.

4. Cigarette butts

After listing a hoarder's house, Candy Miles-Crocker, an associate broker for Long and Foster Real Estate in Washington, DC, poked her head into the crowded bathroom—and saw an enormous mound of cigarette butts in the sink.

“Why the owner did this, I never asked,” Miles-Crocker says.

Even worse, the seller wouldn’t allow her to clean them up—or move anything—to prep the home for a showing. Instead, he created a path through the home’s crowded contents from the front door to the kitchen and bathroom.

“Agents and prospective buyers could not see the bedrooms unless they climbed over the hoard,” Miles-Crocker recalls. “It was crazy.”

Heads up: If your house is in serious disarray, consider "extreme cleaning" professionals to help get your home show-ready.

5. Smart toilets

One of the weirdest bathroom encounters Lauren Cangiano, a licensed associate broker for Halstead Manhattan in New York, ever had was with a trendy, high-end Toto programmable toilet.

“Every time we walked past the bathroom during a showing, the toilet came to life and scared the daylights out of us,” Cangiano says. “The lid would open and close, and lights started flashing. I’m guessing it was set in such a way that someone could find the toilet in the dark. The zinger was when my client dropped something in the bathroom and water started squirting up out of the toilet. I think she activated the bidet setting!”

Heads up: If a fancy toilet floats your boat, hey, more power to ya. But if you've got a bunch of bells and whistles, try to figure out how to deactivate them before you show your home.

6. Poop

Marie Bromberg, a licensed real estate salesperson for Corcoran in New York, had a harrowing bathroom moment at her very first listing.

“It was a lovely studio apartment that was so beautiful and well-priced that it was swarmed," Bromberg recalls. "We had easily 20 people in less than 500 square feet at any given time.”

At one point, an elderly lady stepped into the bathroom and shut the door.

“She didn't even ask! She just went in to do her business,” Bromberg says.

She was in there a long time, and once she exited, Bromberg realized there were two problems.

First: “The smell was awful, and now everyone at the open house could smell it because it's a studio," Bromberg says.

"And, some of it had missed the toilet.”

Before other visitors could complain, Bromberg hastily opened a window and turned on the exhaust fan. Then, she found some paper towels, closed the door, and cleaned the toilet.

Heads up: While the blame for this one can't possibly fall on the seller, there are some things you can do to prevent poop-related problems that might arise during a showing: “Never have toilet paper at an open house, so as to discourage people from doing the deed,” Bromberg says.

Article courtesy Realtor.com

Posted in Market Updates
Feb. 27, 2019

The Year's Top 6 Kitchen Design Trends Will Make Your Mouth Water

kitchen-trends-2019For years, our kitchens have been dominated by bland, white-on-white palettes, granite countertops, and stainless-steel appliances. "Neutral" has been the reigning buzzword.

But are you growing weary of playing it safe? Eager to put your decor in the blender and mix it up? Luckily, 2019 is delivering for change agents. This year, we're tossing neutral design schemes out the window and embracing our collective desire to make a statement.

–– ADVERTISEMENT ––

 

Yes, the kitchen mood for this year is moody.

We've identified the leading kitchen design trends—all you need to do is let them marinate. Think bold colors, bigger backsplashes, and new looks for a space that's always on display.

Here’s a look at what to expect this year in kitchen design.

1. Dark and moody colors

Photo by DEANE Inc | Rooms Everlasting 
“Get ready to see kitchen trends take a turn this year from light and airy to dark and moody,” says Leslie Bowman, interior designer and founder of The Design Bar in Chicago. “While white will certainly still find its way into designs through glistening subway tiles and countertops, the white-on-white aesthetic has seen its day."

In particular, expect to see darker saturated hues, such as blues and greens, trending in kitchens this year, says Annabel Joy, interior designer and founder of Trim Design Co. in Boston.

"We think Rosemary green will be the MVP of 2019," she says. "It’s the perfect marriage of muted sage with deep forest, and it looks great with the current matte-black hardware trend as well as with perma-popular brass."

2. Elevated farmhouse

Photo by GOLDEN GATE KITCHENS

Apologies to those with "Fixer Upper" fatigue: The modern farmhouse look made famous by Joanna Gaines isn't going anywhere anytime soon. But if you're looking for a new twist, you're in luck, Bowman says. In 2019, farmhouse will continue evolving, evoking less of a country chic vibe and coming in hard with cleaned-up contemporary finish.

“You can expect to see the farmhouse aesthetic become a bit more refined and transitional with a heavier lean toward bolder, elegant kitchen designs,” she says.

“Think of it like this: Farmhouse went to rehab and took a nice, long nap,” adds Justin Riordan, founder of Portland, OR–based Spade and Archer Design Agency. “There’s noting shabby or rustic about it. It’s a refined, more masculine version of farmhouse.” That’ll mean no knots in the wood and plenty of pristine lines, he says.

Think: gold hardware, elegant light fixtures, and use of colors instead of an all-white design.

3. Open shelving

Photo by Houzz 
The debate over open shelving has raged on for several years now. While some of us prefer to hide our kitchen gadgets and gizmos behind opaque cabinetry, others of us live to show off our Instagram-worthy counters and shelves, says Jacqueline Gonzalez Touzet, architect and designer at Touzet Studio in Miami.

And because of those people, open shelving will continue to have a foothold in our kitchens in 2019; but this year, we're taking things a step further. It's not just cookware and Smeg appliances we're showing off on our floating shelves.

"People like to express their individuality and curate their collections in their upper cabinets and shelving," Touzet says. "They don’t want cookie cutter, and the open shelving blurs the line between kitchen and living space.  We have clients that showcase collections or display books or art in their kitchens."

4. The end of tiny tile backsplash

Photo by Rethink Design Studio 
"For years now we have had the same [rectangular] tile backsplash used as the color accent in the kitchen," Riordan says. "Thank goodness it's finally falling out of style."

In its place, we're seeing bigger, bolder patterns that sometimes remove the need for backsplash entirely.

"More and more walls are being completely covered with either tile, or a solid surface like quartz from the floor to the ceiling—and we love it," Riordan says. "We could not be happier with the clean, finished look."

5. Everything cast iron

Photo by Glideware 
Any design-oriented homeowner knows that kitchen cookware is as much of a decor choice as the backsplash or cabinetry that surrounds it. And in 2019, our utensils, pots, and pans are changing, too.

"We're seeing cookware shy away from chemical-laden Teflon and nonstick, and heading directly for traditional, good, old-fashioned cast iron," Riordan says. "It takes some getting used to, as the pans are never washed with soap, but man oh man there are some beautiful American-made, cast-iron cookware out there."

Hang these prominently in your kitchen to make a statement about the culinary expert you are.

6. Sustainable materials

Photo by Jenn Hannotte / Hannotte Interiors 
While wood floors and granite countertops aren't going out of style anytime soon, we're beginning to look for ways to infuse our kitchens with more eco-friendly design features. Examples: bamboo flooring, countertops made out of recycled materials, or even the leftovers from wine night.

"Sustainable materials like cork are being used in unexpected ways like flooring and even backsplash," says Trim Design's Joy.

If you love the environment but are nervous about making such a big change, start small: Add recycling stations to your kitchen, or swap out your window dressings and chair cushions for natural fabrics.

Article courtesy Realtor.com

Posted in Market Updates
Feb. 22, 2019

The Home Appraisal Process: What to Expect as a Buyer

appraisal

The home appraisal process is just a formality when buying real estate, right? You've found the house you love and put in a good offer, and it was accepted! It's time to break out the Dom Pérignon White Gold? Sorry, not yet.

If you've applied for a mortgage, your home-to-be still has to undergo a comprehensive appraisal of its worth—and an unfavorable home appraisal can kill a real estate deal. Yikes! It can be a nerve-racking ordeal, but it's actually good for you. Allow us to demystify the process.

Appraisals estimate a home's value with fresh eyes

Just because you and the sellers have agreed on a price doesn't mean it's a done deal—your lender needs to be on board, too. After all, it's the lender's real estate investment as well. To get a mortgage, you'll need a home appraisal because the home serves as collateral for your lender. If for some reason you end up unable to make your mortgage payments, the lender will have to foreclose on your home, then sell the property to recoup its costs. So your mortgage lender will have to know the value of your home before handing over that large chunk of change.

While the home appraisal process is somewhat similar to getting comps—as you did to determine a fair price—the appraiser delves in deeper to determine the home's exact value.

An appraiser will investigate the condition, the square footage, location, and any additions or renovations. From there, he or she will appraise the home and determine its value.

An appraiser is trained to be unbiased, says Adam Wiener, founder of Aladdin Appraisal in Auburndale, MA.

“I don't care what anybody wants the home to be worth," he says. “As an appraiser, I'll give you the answer. You may not like it, but it's the answer."

Off-site, the appraiser may also evaluate the current real estate market in the neighborhood to help determine the value of the property.

Usually, the lender or financing organization will hire the appraiser. Because it's in the best interest of the lender to get a good home appraisal, the lender will have a list of reputable pros to appraise the home.

Whoever takes out the mortgage pays for the home appraisal, unless the contract specifies otherwise. Then the buyer pays the fee in the closing costs. If a seller is motivated, he may pay for the home appraisal himself to back his asking price, which benefits the buyer by reducing closing costs.

You'll get a copy of the home appraisal, too

An appraiser sets out to determine if the home is actually worth what you're planning to pay. You might be surprised by how little time that takes; the appraiser could be in and out of a home in 30 minutes, and that's not a reason to panic.

An appraiser doesn't have the same job as a home inspector, who examines every little detail. While they'll pay particular attention to problems with the foundation and roof, the home appraisal process includes noting the quality and condition of the appliances, plumbing, flooring, and electrical system. With data in hand, they make their final assessment and give their report to the lender. The mortgage company is then required by law to give a copy of the appraisal to you.

Appraisers work for your lender—not you

As the buyer, you'll be paying for the home appraisal. In most cases, the fee is wrapped into your closing costs and will set you back $300 to $400. However, just because you pay doesn't mean you're the client.

“My client is the lender, not the buyer," Wiener says. This ensures that appraisers remain ethical—in fact, it's a crime to coerce or put any pressure on an appraiser to hit a certain value. Appraisers must remain independent.

“Anything less, and public trust in the appraisal is lost," says Wiener.

They protect buyers from a bad deal

In essence, the home appraisal process is meant to protect you (and the lender) from a bad purchase. For instance: If the appraisal comes in higher than your asking price, it's generally fine. Sure, the sellers could decide they want more money and would rather put their home back on the market; but in most cases, the deal will go through as expected.

If your appraisal comes in lower than what you offered, this is where things get tricky: Your lender won't pony up more money than the appraised price. So if you and the sellers agree on $125,000 but the appraisal comes in at $105,000, it creates a $20,000 shortfall. What's a buyer to do? Read on.

A curveball appraisal isn't necessarily the end

If the appraisal process happens, your appraisal comes in low, and your contract with the seller was contingent on an appraisal, you could walk away and have your earnest money returned.

If you prefer to buy the home anyway (or waived your appraisal contingency), there are some other paths you can pursue:

  • Come up with the cash to cover the difference between the appraisal and offer price.
  • Ask the seller to cover the difference.
  • Challenge the appraisal, and pay for a second opinion.

Keep in mind, though, that your new report could come out identical. Also keep in mind that if you do choose to walk away, that's actually good news, although it may not seem like it at the time. Why? Because the appraisal kept you from paying too much for your home.

Once your appraisal is done, you're still not ready to close without another nerve-racking step called a home inspection.

Article courtesy Realtor.com

Posted in News
Feb. 12, 2019

Foreclosure vs. Short Sale: What's the Difference?

Short Sale vs. Foreclosure: What's the Difference for Buyers?

What is the difference between a foreclosure and a short sale? Foreclosures and short sales are both options for homeowners who fall behind on mortgage payments, but it's important to understand the difference between these two processes.

So if you're struggling to pay your mortgage and aren't sure what to do, allow this primer on foreclosures vs. short sales to set you straight. Here's what these things are, their pros and cons, plus how to tell whether a short sale or foreclosure is the better option for you.

What is a short sale?

short sale happens when a homeowner owes more on the mortgage balance than the market value or sale price of the property at the point the owner wants to sell. For a short sale, the homeowner is essentially asking the mortgage lender (typically a bank) to accept a lesser amount than the total mortgage owed. For example, if the homeowner sells the house for $250,000, but the remaining mortgage loan balance is $300,000, the seller is essentially $50,000 "short" on paying the lender back. That's a short sale.

If the lender accepts the short sale terms, the loan debt will be settled and the borrower released from any further liability once the short sale has closed, says Paola Martinsen with Equity Real Estate in Murray, UT.

Like other homes for sale, a short sale property will be listed by a real estate agent (typically one who specializes in short sales).

For the seller, one thing you'll want to watch out for is a deficiency judgment. A deficiency judgment is where, after a short sale ends, the mortgage holder seeks to recover the "deficiency" (the money it lost in this home sale) through a court order placing a lien on the debtor for further money (so in this case, a mortgage lender acts as a lien holder). Some states outlaw this practice, but you should ask, just so you aren't blindsided by it later.

What is a foreclosure?

Foreclosure is a legal process that happens when a homeowner (although "borrower" might be a more appropriate term from the perspective of the lender) is unable to make mortgage loan payments for a significant period of time.

After three to six months of missed mortgage payments, a lender will issue a Notice of Default with the County Recorder's Office. This notice is to let the borrower know he is at risk of foreclosure—and when they foreclose, the current owner will be evicted.

After receiving the Notice of Default, borrowers can try to settle their loan debt with their lender either through a short sale or by paying the mortgage balance they owe. This period is called pre-foreclosure and can last anywhere from 30 to 120 days after receiving the Notice of Default.

If the debt is not recouped, lenders will step in and foreclose on the property. To foreclose, they'll schedule a foreclosure auction to sell the house to a third party. Foreclosure auctions will be advertised in local newspapers and are typically held at either the property or the local courthouse, says Cathy Baumbusch, a real estate agent with Re/Max Allegiance in Alexandria, VA.

If no one buys the home at auction, the lender becomes the owner and it's considered a bank-owned or REO (real estate–owned) property.

Another option to avoid foreclosure is to do a deed in lieu of foreclosure. A deed in lieu of foreclosure is a transaction where a homeowner transfers title or ownership of the property to the lender in exchange for being released from their loan debt-free and clear.

What is the difference between a short sale and foreclosure?

Short sale and foreclosure are similar in that they're both financial options for individuals who own homes but find themselves in financial distress. Both also have a negative impact for your tax return, credit score and credit report, and future prospects getting a loan.

But short sales and foreclosures differ greatly in process. A short sale transaction occurs when mortgage lenders allow the borrower to sell the house for less than the amount owed on the mortgage. The foreclosure process occurs when lenders repossess the house, often against an owner's will.

Timing also differs: Short sales can take up to one year to close, while foreclosures generally move along much faster because lenders are intent on recovering the money they're owed.

Furthermore, a short sale is far less damaging to your credit score than foreclosure. In fact, people who go through the short sale process can usually buy another house without having to wait, although securing a second mortgage might be more challenging. Foreclosure, on the other hand, will stay on your credit report for seven years. You'll also have to wait five years to buy another house.

If paying your mortgage has become a real challenge, the smartest step to take is to talk to your lender to discuss your options. Chances are, your lender will be able to offer the best plan of action based on your unique situation and the laws in your state.

How short sales and foreclosures work for buyers

Short sales can be a good deal for bargain house hunters, but buying a short sale can be a headache.

“I wouldn't recommend purchasing a short sale for first-time buyers, who may get frustrated with the extra paperwork and long waits,” says Marlene Waterhouse, owner of Short Sale Solutions.

The average short sale takes around 90 to 120 days, and sometimes even longer. Why? Mortgage lenders often won't approve the sale without buyers agreeing to its demands like paying for many additional fees such as repairs, wire transfers, and closing costs. These are all costs the seller would typically be on the hook for, but in a short sale, the bank is stuck with the bill. Therefore, to reduce its costs, the bank may try to negotiate these costs with the buyer.

Other than the involvement of the bank, a short sale will proceed much like other sales. Buyers can get a mortgage and have the opportunity to seek an inspection.

Foreclosure sales, however, are different. For one, foreclosure properties can be purchased only with cash; no traditional loan will be granted for a foreclosure.

While a foreclosure can be a great deal for home buyers (particularly foreclosures that have been taken over by the Federal National Mortgage Association, better known as Fannie Mae), they also come with some risk, says Baumbusch.

“Keep in mind that a foreclosed home sold at the courthouse is bought without warranty and sight unseen,” she adds.

That means you will not be able to have a foreclosed home inspected for structural problems, mold, infestations, or other issues with the house. You will also assume all liens that might be tied to the property.

Article courtesy of Realtor.com
Posted in News
Jan. 28, 2019

5 Hacks to Make a Tiny, Cramped Closet Look Huge

small-closet-hacks

No matter how beautiful and spacious your home is, one out-of-sight area could still make visitors cringe: your closet. Especially if it's small, dark, and cluttered.

"A house can be amazing, but if it has no closet space or the closets are super small, which you do see sometimes in older homes, that can be a major turn-off," says Lori Matzke, owner of Home Staging Expert.

It's a fact: Having ample closet space is a high priority among homeowners—all the more so if you're trying to sell your place. After all, you never know if a home buyer is a fashionista with oodles of apparel, or just someone with tons of stuff to store (which is just about everyone else). So, trust us, home buyers checking out your house definitely won't be shy about opening up your closets to see what's up!

While you might be able to renovate and add closets to your home or make the ones you have bigger, that will be costly and not necessarily worth the investment. Instead, staging a closet to look its best is a relatively inexpensive way to make what you have look more appealing. Here's how to do it right.

Declutter your closets

Get those garbage bags ready, because the first step is cleaning and clearing. You don't want a potential buyer opening that door only to have an old box of scarves or your extra bedsheets fall on their heads!

Kris Lippi, owner of Get Listed Realty in Hartford, CT, suggests removing as many items from your closets as you can to show them off as spacious. If you have to invest in a self-storage space to hold your old boxes of letters or your holiday decorations, do it.

Add a fresh coat of paint—and a light

"Small or dark closets are never a good selling point," Matzke warns. To maximize the space you've got, Matzke suggests painting the entire closet white or off-white to appear brighter and larger.

You can also add a closet light to brighten the space. This will give buyers the sense that they'll be able to find things, even way, way in the back.

Finally, attach a mirror to the inside of the closet door or to the back of the wall, Matzke suggests, to add a sense of depth. This "can make the space feel much more livable," she notes.

Photo by Deborah Broockerd/Closet Factory 

Add some closet organizers

If your closet always ends up as a pile of clothes, this may be the time to pull the trigger on a fancy closet organization system.

Investing in a California Closets type of system, or even one custom-built by a local carpenter, can make a huge difference. Or, on the lower end of the budget, shelves from your local home improvement store can accomplish something similar for less money. A few simple elements such as shoe organizers that make the entire closet look neater and larger will go a long way without costing you a significant chunk of change.

"There are certainly DIY closet systems, or even just individual organizers you can implement yourself and attach to the closet walls, if you're handy or maybe know someone who is," Matzke says. "You don't even need an entire system."

Display your stuff

Although it's tempting to cart all of your stuff away to a self-storage unit, remember that part of staging a home is making it look just lived in enough for other home buyers to see themselves in your home. When you add your clothes back in, one-third of the space on each shelf or hanger rack should remain open, making the space appear useful, rather than overflowing.

Invest in some nice hangers to give it a truly organized feel, and position all the items in your closet so they face forward or are hung in the same direction—just like boutiques do, Lippi advises.

Fix what's broken

This isn't about space, but ease of use: Does the door of your closet stick? Is that shelf hanging by a thread? It may not bother you, but others will notice—and this detracts from their first impression. As Matzke warns, "A sticky closet door or one that just doesn't open smoothly or all the way would be frustrating."

Plus, it leaves the feeling that your closet presents a problem; spacious or not, this isn't good. All in all, it's these little things that make a closet look and feel spacious and well-organized—and can make your home the envy of all who peer inside.

Photo by Renew Doors and Closets LLC 

Article Courtesy Realtor.com

Posted in News