Are you confused over all the mortgage options and lender lingo? Here's a quick "cheat sheet" to get you started. Once you're ready to take the mortgage plunge and find your dream home, let us know! Not only will we happily guide you through your search, we will also happily provide you with contact information for some lenders with whom we often and successfully work.
I was showing a lovely older home the other day when the prospective buyers asked a common question. “How can this be called a bedroom, it’s so tiny!” It turns out the space was large enough to be called a bedroom, along with some other requirements that make a bedroom a bedroom.
How big does a room need to be? Think of it as hitting lucky 7s on a slot machine (three 7s for those of you who don’t gamble). The room needs to be a minimum of 70 square feet, with a minimum ceiling height of 7 feet for at least half the room, and a minimum floor dimension of 7 feet. Since the room we were looking at was 7 ½ feet by 9 ½ feet the minimum square footage was attained as well as the minimum 7 foot floor dimension in each direction. The ceiling was 7 ½ feet throughout the room.
My buyer’s next question is again a common one: “But what about a closet? I heard that it can’t be called a bedroom if there’s no closet.” The short answer is no.
The long answer is that a bedroom needs more than just the minimum square footage and ceiling height. A bedroom must also have:
- at least one window (the size of which is determined by the room’s square footage and whether it is the only outside egress). The window must be able to be opened to provide ventilation
- at least two exits from the room, and one of them one must exit directly outside (it can be a door or a window)
- at least two electrical outlets, or an overhead light at a minimum of one outlet
- a permanent heating source (no plug in electric or other type of movable source)
- privacy – the bedroom cannot be a “walkthrough” (accessible only through another room) and must have a door
These requirements are in place in all 50 states as part of the International Residential Code. Each state may also have additional requirements based on the age of a home. For instance, newer construction in Massachusetts requires outlets every 6 feet, so you’d definitely have more than one or two outlets in a room (a good thing these days with all our technology).
In the end, my buyers decided not to make an offer on this particular property, but they did learn something about real estate!
Are you nearing retirement age? Or are you thinking about purchasing a second home with the ultimate aim of it becoming your full-time home when you retire? Here are some tips to keep in mind when searching for that home.
Look for a Single-Story Property
Having everything you need located on one level makes life easier, particularly as you age. Avoiding stairs can also help you avoid trips and falls and can prove to be quite beneficial in the long run.
A Location That Will Suit Your Future Needs
Location should play a critical role in deciding where to buy a property. There are factors to consider such as the climate, availability of optional utilities like internet and cable, and conveniences such as healthcare, shopping, outdoor space and entertainment venues. If you plan to have friends and family visit, you may want to find a home with easy access to transportation or the city, where you can attend cultural events or check out the newest restaurants or fun activities.
Space for You – And Your Partner
Regardless of age, everyone needs company at times, as well as private, quiet space. Don’t forget that your partner may not always want to be doing the same thing as you. Make sure there's room for two so that you and your other half can stay close to each other – but not too close for comfort! A spare bedroom that can be used as an office or sewing room or sitting room can provide just the space you need to make your house a happy home.
Showers vs. Bathtubs
Consider a walk-in shower or a familiar type of bath style rather than traditional bathtubs or jetted tubs. Having a bathtub/shower combo is much more preferable, as they allow an easy point of entry. Bathtubs can prove to be difficult to get in and out of, particularly soaking tubs or jetted tubs with their higher and wider sides and deeper tubs.
Bigger Hallways and Entryways
Tight hallways have never done anyone any favors. Look for a home that offers hallways and entryways that you can spread your arms in without butting into things or knocking items over unintentionally. Not only will you have more room to welcome guests, but if the need for a wheelchair, walker or cane comes up later, you will have room to navigate with your new assistance equipment.
Give some thought to a gated community for an extra measure of security. Look into emergency alert systems. Many new construction communities offer the option of alarm buttons or pull cords in various spots throughout the home that will automatically send a call for help. You can also add these services when you feel the need.
Don’t Forget Fido and Fluffy
Pets are like our children, we love them and can’t imagine a life without them (even when they’re naughty). A retirement home without your pet would surely feel empty. So if you have a pet(s) be sure they will be allowed if you purchase a home or condo in a community with a Homeowners Association.
Ready to Start Your Search? When you’ve decided to start looking for that retirement property, let me know. My team and I will help you find the perfect spot!
Are you trying to decide if buying a home is right for you? Are you agonizing over whether this is the time or not to buy? The answers are a resounding Yes, and Yes!
In some cases renting may be the right choice, but in the long run, there’s no clear-cut benefit to renting versus owning your own home. You can reap the financial and personal benefits that renters can never match. To wit:
Don’t pay your landlord’s mortgage. When you pay rent each month, your landlord increases his financial position. The landlord can use the money to pay down his own mortgage, finance a vacation, build up his retirement account – all sorts of ways that your money can be put to work for someone else!
Don’t throw your money away on rent. Unlike paying monthly rent, when you make a monthly mortgage payment you help strengthen your financial future. As you steadily pay down your mortgage, you are building equity in your home. When you have 20% or more equity in your home, you can tap into it through a home equity loan and use that money how you wish, whether it’s to improve the home, purchase a car, pay for education – you decide! Or you may decide to refinance your into one with a lower interest rate or a shorter term.
Plan better with fixed housing expenses. Rent will always go up! And they often go up considerably, as market prices change and the landlord’s property maintenance and tax costs increase. If you choose a fixed-rate mortgage, your mortgage costs will remain the same over the term of the loan. Of course, your homeowners insurance and property taxes may increase, but you’ll be better able to plan for those increases by knowing your monthly mortgage payment won’t increase.
Do anything you want with the property. Yes, when you own your home you can do what you want with it (provided you adhere to local zoning and building codes and neighborhood covenants). You are free to paint rooms, hang pictures, have pets, renovate rooms and change the landscaping. Want to put up holiday decorations or hang a flag? Go ahead! Being a homeowner means you have the freedom to create a home that reflects who you are, not who your landlord dictates you to be.
Enjoy tax benefits. Homeownership is an important part of the economy, and federal and state laws exist to offer unique benefits to homeowners. You can deduct the interest you pay on your mortgage and property taxes up to a certain amount. That’s like getting a raise without having to work more hours!
Put down roots. Owning your home helps you become more invested in a neighborhood and the surrounding community. You can become involved in local community organizations and schools, participate in town government, take part in whatever local groups and activities you like, while developing fulfilling relationships within the community and putting down lasting roots.
Of course, deciding to buy a home is always a personal decision, based on your particular needs and goals, but if you’re considering buying a home let’s talk! Together we can discuss the pros and cons, connect you with a mortgage professional, and see if it makes sense to go out and find you a place of your own!
A high credit score can help you qualify for lower mortgage interest rates, so it is important to know what affects your score. Credit scores are calculated based on information from one or more of the three major credit bureaus: Experian, Equifax, and TransUnion. Lenders also often use scores from the Fair Isaac Corporation, or FICO.
Credit bureaus don't consider other factors, such as your salary, your bank account balances, and any payments that are fewer than 30 days late. However, your lender will use this data along with your credit score to decide both what mortgage rate and what amount of mortgage you will qualify for. So what affects your score? Possibly some things you haven’t thought about other than making late payments. Your payment history makes up about 35% of your score, so you should avoid paying bills late whenever possible. Missing one payment generally won’t impact your score much, but missing multiple payments could make qualifying for a good mortgage rate difficult. Establishing a good payment history for loans, utility bills and credit card bills will show creditors that you're reliable and responsible.
The amount of your available credit that you're using accounts for about 30% of your credit score. To achieve the best score, you should use less than 10% of your available credit. If you need to use more, try to keep it under that 30% threshold. For example, if you have no loans (lucky you) and you have a credit card with a $5,000 limit, you should keep your card balance under $500 to make sure your credit utilization stays under 10%. Applying for another credit card will increase your available credit and make it easier to keep your credit utilization low. It sounds counterintuitive sometimes to say “you need to open another credit card account” but this is the reason behind the advice.
The average age of your credit accounts makes up about 15% of your total score. Applying for several new accounts in a short time can temporarily lower your credit score, as the accounts will all be without a payment history. Older people and those who applied for credit at an earlier age usually have higher scores, as they have a longer credit history. Having a good mix of accounts makes up about 10% of your total credit score. People with the best credit scores have both credit cards and installment loans, such as a mortgage or a car loan, rather than just credit cards. Utility bills can also be part of the credit mix.
When you apply for credit, the lender makes an inquiry about your credit report. The number of inquiries on your account makes up about 10% of your credit score, and too many in a short period can lower your score. While only inquiries from the previous 12 months will impact your credit, several inquiries from various mortgage lenders within a short period of time will be treated as if they were just a single inquiry, and thus will have very little impact on your credit score. And checking your own credit report won't change your credit score, so check away and keep track of the progress you’re making in raising your score!
If you'd like more information, or would like some recommendations for great lenders, just let us know!
One of the biggest questions when buying a home is “how much can I afford?” Once this question is answered, it’s much easier to narrow down your home shopping wish list to fit your budget. There are several factors that go into determining how much mortgage you can afford. Here are three of them.
Debt-to-income ratio or DTI: Your DTI can be calculated by adding up the mortgage payment, taxes, insurance, condo or association fees, credit card debt, auto loans, and any other debt you pay each month. That total is then divided by your gross monthly income (income before tax).
Loan-to-value ratio or LTV: Your LTV is calculated by the amount of mortgage you’re looking to borrow compared to the value or purchase price of the house. It is expressed as a percentage, so you will often hear something like “80% loan to value.” This means you’re borrowing 80% of the purchase price of the home. LTVs will vary depending on the amount of money you have to put down and will also determine what type of mortgage you will qualify for.
Credit score: Your credit score will impact the type of mortgage loan you qualify for. If you don’t know what your current credit score is, you may want to check with your loan officer or at least one of the major credit reporting agencies (Experian, Equifax or TransUnion) before you start calculating what you can afford. While many credit card companies and other lenders offer “free credit score” information, an accurate “FICO” score needs to be obtained from at least one of the major lenders when applying for a mortgage.
In Summary: There are many factors that go into what you can afford. The first step should be speaking with a loan officer. That will allow you to create an affordability plan to give you a pretty good idea of what price range you fit into and what mortgage options are available to you.
If you’re thinking of buying a new home, let us know. We are happy to share contact information for lenders we have successfully used over the years. We can also help you get started on creating a home search plan!
History of Patriotic Bunting
Bunting has been used since at least the early seventeenth century to brighten events with a cheerful burst of color and flair. The origin of the word is uncertain. One theory is that the word “bunt” means colorful in German. Another theory is that it may have come from the name of the material used to make the flags. Buntine was a lightweight worsted-wool fabric known for flying well in the wind, and for its durability even in salty sea air. Thus, it was used to make flags for naval ships. Rows of small flags are still used today by naval communications officers to signal from ship to ship.
The modern use of the term ‘bunting’ is typically used to describe decorations of any material, whether it’s cloth, paper, cardboard, etc., intended to look like decorative fabric. Typical forms of bunting are strings of colorful triangular flags and lengths of fabric in the colors of national flags, gathered and draped into swags or pleated into fan shapes.
These days, bunting is used widely to celebrate holidays with a patriotic flair. It is used to decorate both indoors and out, but generally can be found decorating the exterior of a house, fence or lamppost on holidays that also call for flying the American flag.
Are you thinking about buying a vacation home rather than spending money on annual vacations in other parts of the country or the world? Are you worrying that vacation plans may continue to be interrupted for the foreseeable future? While it may sound like a great idea, purchasing a vacation residence is a huge financial decision. Here are some tips to keep in mind before you sign that offer to purchase.
1. Don’t rush your decision!
Location, view, features and other amenities determine whether a vacation home is a wise investment - or a financial disaster. Would you prefer to spend more time skiing or soaking up the sun? Do you love mountain air or the salty sea breeze? Remember, this is a long term financial decision. Don’t get caught up in the excitement of the moment and end up buying a log cabin on a lake when you are really more of a villa on a golf course kind of person.
2. Calculate the costs!
Don’t bite off more than you can chew. In addition to a possible mortgage payment, you’ll need to pony up for real estate taxes, homeowner’s insurance, ongoing repairs and maintenance, management costs, utilities, and HOA fees if you purchase in an association or condo complex. You may also need to furnish the property if you don’t find something that is totally turnkey.
3. What is your main motivation?
Are you thinking of renting the property, either long or short term? Renting out your home can mean constant cleaning and an inconsistent income stream. If your property is not local, you’ll need to hire a management company or someone to watch for any issues and prepare the property for move in and move out. Plus, to earn top dollar, you’ll need to open up your home to renters during peak season—the same time you’ll likely want to be there. Finally, many associations have rules regarding if you can rent, to whom and for how long. It may turn out that the rules preclude your earning any real income.
4. Does distance matter?
While you may love the idea of a slope-side condo in Colorado or a high-rise apartment in Miami, don’t underestimate the difference between a two-hour drive and a multi-hour flight. An accessible vacation home will inevitably be used much more often than a place a couple time zones away. Plus, if your motivation stems from worries about current or post-pandemic travel, purchasing far from home doesn’t make sense.
5. Find a Realtor and a lender who are familiar with the area
Use the skills and experience of a local agent and lender. You’ll need an agent who is familiar with different neighborhoods, association rules and market conditions. Local lenders will be comfortable with appraisals, can help with different funding options and will be experienced with lending in rural areas. You want to be sure your purchase goes as smoothly as possible.
6. Priceless Time
A second home can function as a retreat away from the hustle and bustle of everyday life and worries. Regular vacation time can help you recharge your batteries and live a happier, healthier life. It can provide a wonderful spot to gather with family and friends, and create lasting memories to cherish.
7. Added Benefit
If you’re planning to retire and downsize in a few years, buying a second home now can help you ease into the next stage of your life. When it’s time to retire and sell your primary residence, your retirement space will already feel like home!
So, are you ready to start looking for that vacation home? I’ve got experienced real estate colleagues all across the country. Give me a call and we can get the process started!
What the heck is going on in this current real estate market? I’m fielding multiple offers on every listing. Properties generally have an accepted offer within 3 days of putting a property into MLS. Excellent, well-structured, appealing offers are being submitted with all the required paperwork. A complete set of paperwork - that in itself is somewhat of a miracle! From a seller’s standpoint it can be both a welcome boon and a daunting task to decide on what constitutes the best overall offer. That may not be the offer with the highest price, as there are other factors to take into consideration.
Does the buyer have something to sell? How much is the buyer putting down? Is the buyer pre-approved or just pre-qualified? When does the buyer want to close on the property? Does the buyer want to have a home inspection? Will the lender require an appraisal? Are there any unusual requests or restrictive contingencies in the offer?
Weighing all the pieces of the offer is important when determining exactly which offer a seller feels the most comfortable accepting, and which offer is the most likely to close on time and with the least potential for hitting snags. An experienced and area-knowledgeable Realtor will be able to examine all the details, explain the pros and cons of each offer, and help guide and advise a seller toward a successful closing.
But what if you’re on the buyer side of this crazy seller’s market?
Leading real estate sources indicate home prices will continue to increase. So to be successful, you'll need to be prepared. Determine exactly which town or towns you want to purchase in; this is not the time to be wishy washy and looking all over the place, looking solely by price point. This also ensures that you know the areas and neighborhoods of a town, so you’ll know when you see a listing if it’s in a spot you want to live. Life these days is stressful enough, don’t waste time looking at a home in a spot where you absolutely don’t want to live. Be prepared to see a property the moment showings begin. If a house is listed on Thursday and showings begin on Friday, don’t wait until Sunday to see it. There is a very good chance it will already be off the market! Have your “ducks in a row” so you’ll be ready to submit an offer. This means knowing your purchase price comfort level, having a current pre-approval, having a lender who is super accessible 7 days a week, having your checkbook with you so you can give your agent a deposit to go with your offer, and very importantly, listening to your agent regarding structuring your offer.
While these preparations won’t guarantee that your offer will be the winning one, they definitely will increase your chances of success.