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  • Should You Buy a Home Warranty When You Move?

    Should you buy a home warranty when you move? For many buyers, home warranties offer peace of mind when it comes to budgeting for home expenses. For others, home warranties are simply a waste of money. Whether or not you need to purchase a home warranty depends on your specific needs, finances and the condition of your new home. Fortunately, we’re here to help. To make your decision easier, we’ve included information on what home warranties are good for (and what they’re not) as well as the types of homeowners who should and should not consider purchasing one.

    What is a home warranty?

    So what is a home warranty, anyway? It’s essentially a single protection plan that homeowners can purchase to cover the cost of repairs and replacing of appliances and systems in their homes. Basically, think of it as insurance for your home appliances. However, unlike homeowners insurance, home warranties only cover basic appliances and features, while insurance covers big-ticket items such as the structure of your home and personal household belongings. Typically, insurance also requires a major event such as a fire, flood or burglary to take place in order to receive compensation for items, whereas home warranties may only require general wear and tear or malfunction of an appliance. For information about the cost of home warranties, check here.

    What does a home warranty cover?

    Practically every homeowner will experience problems from time to time with appliances and home features. After all, who hasn’t had a dishwasher or refrigerator break down at least once in their lives? Fortunately, this is where home warranties can help. Having a home warranty ensures that if your appliance breaks or become damaged, a service professional will come to your home to repair or replace the item. Since you’ve already purchased a home warranty, the only thing you’ll likely end up paying for is the small service fee. On the other hand, those who do not have a home warranty will need to pay out of pocket for any replacements or repairs. Home warranties typically cover:

    • Plumbing systems
    • HVAC units
    • Electrical systems
    • Washing machines and dryers
    • Garbage disposal
    • Ovens and stovetops
    • Dishwashers
    • Refrigerators and freezers
    • Water heaters

    What to do before you move 

    • Read up on what a home warranty actually covers – Debating whether or not to purchase a home warranty? First, read up on what a home warranty does and does not cover. Most home warranties cover the cost of repairing or replacing a number of home appliances and systems within the home including the ones listed above. Certain providers may also give customers the option to add extra home features such as a swimming pool to their home warranty plan. Be sure to research different providers and their offerings before committing to a home warranty plan.
    • Ask the seller about existing home warranties– Do the sellers have a home warranty already? Do they have individual manufacturer warranties for different appliances? Make sure to ask the sellers these questions when purchasing a home. The sellers may even offer to pay for all or part of the buyer’s home warranty during the first year.
    • Have an inspector get a good look at the home’s appliances and features – Under contract and preparing to purchase a home? Be sure that the inspector who oversees your official home inspection gets a good look at the appliances and systems. Your inspector should be able to give you a full assessment of the condition of these items. This should make it easier to decide whether or not you need a home warranty. For instance, if an appliance is on its last legs, it’s probably a good idea to purchase a home warranty and/or ask the seller to handle the repairs prior to closing.

    Home warranties are ideal for:

    • Those moving to an older home or one with outdated appliances – Home warranties are ideal for those moving to an older home or one with outdated appliances. After all, with older homes, it’s just a matter of time before something breaks down (and trust us, it will!). So save yourself the headaches, frustration and expense by buying a home warranty when moving.
    • Those who are risk averse – Does the thought of a broken fridge keep you up at night? If you’re one of those people who simply needs the peace of mind that a home warranty provides, we strongly suggest purchasing one when you move.
    • Those who are not financially prepared to make a large, out of pocket expense – Of course, new appliances don’t come cheap. In fact, refrigerators, washing machines, dishwashers and other big-ticket appliances can set you back a few thousand dollars. Unless you’re financially prepared to replace these items at the drop of a hat, it may be a good idea to purchase a home warranty.

    Home warranties are not ideal for:

    • Those moving to a new home or one with updated appliances – Moving to a new construction home? You likely won’t need to bother purchasing a home warranty. Most new home features and systems should work without the need of repairs or replacements for several years. In addition, these newer appliances should still be covered under manufacturer warranties, which are usually good for up to several years.
    • Those who already have individual manufacturer warranties on appliances – Does the seller have manufacturer warranties for certain appliances? If these household items are already covered under an individual warranty, then there’s likely no need to purchase a larger umbrella home warranty policy, unless you’re worried about plumbing, electrical and other big ticket items breaking down.

    What to do with your warranty information

    If the seller passes along their manufacturer warranty or home warranty information to you, be sure to store all paperwork and receipts in an easy-to-find file folder and/or home binder. 

    Ready to move?

    So you’ve bought a home, purchased a home warranty and are ready to move. Congrats! To find a reliable moving company, check Moving.com’s extensive network of movers. Our website makes it easy to find and book the best moving company for the job. All relocation companies in our network are licensed and insured, so you can rest assured that your move will be in good hands.

  • 11 Ways to Save for a Down Payment

    On the path to home ownership, few tasks seem more insurmountable than having to save for a down payment. The median asking price for U.S. housing in 2018 was just over $206,000, according to data from the U.S. Census Bureau. For that price, competitive buyers are expected to put down between $20,600 and $41,200—no small chunk of change for most people. Stagnant wages and student loan debt have made it more difficult than ever before to save for a down payment, but plenty of people do it with careful savings plans. Read on for some actionable down payment advice, including 11 ways you can start building up the capital you need.

    How much do you need to save for a down payment?

    You may have heard that 20% is the gold standard when it comes to down payments, but in fact, many of today’s buyers are putting down closer to 5% or 10%. And if you’re a first time buyer who’s willing to take on the added cost of mortgage insurance, you can even get away with putting down just 3% of your total home’s purchase price as a down payment.

    Keep in mind that the amount you need to save for a down payment varies greatly by your lender and your credit qualifications. To get a feel for your own situation, reach out to a mortgage broker. They’ll be able to pull your true credit score (not the one you see on a consumer report) and based on their expertise tell you how much you’ll likely be expected to put down.

    How to save for a down payment

    Whether you’re putting down $1,000 or $50,000, you’ve still got to figure out how to save what you need. Incorporate one or more of the following tips into your savings plan to start saving faster.

    1. Open a new savings account that’s just for your down payment

      Create a separate account with no linking debit card or checks that you can use solely for the purpose of saving for your down payment. Try to transfer a certain percentage of all incoming money into the account—every little bit makes a difference.

    2. Use cash instead of credit

      As much as you can, rely on cash for your everyday spending instead of a credit card. You’ll be more conscious of how much you spend and less likely to splurge on unnecessary or overpriced things, in turn helping you keep more money in the bank that you can put toward a down payment.

    3. Set achievable goals

      Again, even small amounts add up. Instead of focusing on one big number that you have to get to, break it up into smaller, more manageable amounts. Try to save just $100, then another $100, and so on. It will put things into perspective so that when you do manage to set aside $10 or $20 toward your goal you’ll actually recognize it for the accomplishment that it is.

    4. Create a budget

      One of the best things you can do for yourself when actively saving money for a down payment is determine just how much you have left over after necessities. This is the money you’ll be able to save from, after all. Set a budget that takes into account all of your monthly payments in order to help you make smart choices about how you spend the leftovers.

    5. Sign up for automatic saving plans

      Many banks will help you automatically save by rounding up the dollar amount on purchases you make and putting the extra into a savings account. It’s a no-fuss way to save money without having to even really think about it.

    6. Dedicate any extra income to your down payment

      Put any bonuses or cash gifts aside for your down payment instead of spending them as they come in. Even that $20 your grandma sent for your birthday is worth holding on to.

    7. Think, then spend

      Trying to save for a down payment doesn’t mean you have to completely stop spending money on things you enjoy, like clothes or concert tickets. But it does mean that you want to put more thought into buying those things that take you a few steps back from achieving your goal. For any purchase that isn’t a necessity, give yourself 24 hours to think about it and decide if it’s worth it. If it’s a really big purchase, give yourself a week.

    8. Put your spending into context

      It’s much easier to save money when you consider purchases in terms of how hard you had to work to pay for them. Is a designer bag really worth a week’s worth of work? Probably not, but a house certainly is.

    9. Remove temptation

      If you’re subscribed to marketing emails from your favorite brands or stores you’re baiting yourself to spend money on non-essentials. Click “unsubscribe” so less temptation ends up in your inbox and you can focus more on the purchase that matters most to you.

    10. Make shopping lists (and stick to them)

      Stores work hard to get you to buy more than you came for. Beat the system and save a ton of money by creating a list of what you need before you go and actually sticking to it. Yes, even if that means forgoing the oh-so-tempting dollar section at Target.

    11. Sell stuff you don’t want or need anymore

      Chances are you have plenty of things in your home that you never use. Put unneeded belongings to good use by selling them for cash online or with a yard sale. Not only will you make some money, you’ll also have less to pack up when you do finally save enough and make your move—a win-win!

    Don’t look at a down payment as an impossible hurdle to jump over. Break it into small, digestible goals so that you can see your progress in action, and never lose sight of the reason you’re working so hard to save. If owning your own home is truly important to you, it will be more than worth it to pass on the expenses that bring you immediate gratification but take you further away from what you really want. Be smart in your spending and realistic in your home buying budget and you should be able to save up what you need.

  • Should I Buy a House With a Swimming Pool? Here’s What You Should Know First

    Thinking of buying a house with a swimming pool or installing one in your current home? You’ll need to carefully consider all aspects of pool ownership before taking the plunge. While owning a home with a pool comes with plenty of advantages (namely that it can improve physical health, boost mental health and expand your social life), it can also come with quite a few serious considerations. From the price of pool maintenance and the cost of higher insurance premiums to the safety of your children and the impact on your property value, there’s plenty to think about when buying a house with a pool. Here are eight things you should know when making this decision. 

    8 Things to Know Before Buying a House With a Swimming Pool 

    1. Pools require regular maintenance and cleaning

      Unfortunately, pools do require regular maintenance. From using the proper chemicals to cleaning the surfaces, the upkeep of a swimming pool takes time and effort on the part of the homeowner. Otherwise, PH levels could become imbalanced and problems such as algae and bacteria could reek havoc on the health of you and your family. Don’t have the time or energy to take care of a pool? Fortunately, there are plenty of pool service companies available to help maintain your pool. Most pool service pros cost anywhere from $50 to $150 a week. In addition to being fairly expensive, these pool professionals will likely have to service the pool several times a week for regular upkeep. So be prepared to see the pool professionals on a weekly basis, if you own a swimming pool.

    2. Having a pool can improve your quality of life

      Buying a house with a pool comes with its fair share of perks. For one, pool owners have access to their private swimming pool to enjoy whenever they wish. Second, swimming can improve cardiovascular health, flexibility and overall physical well-being. It’s also been proven to boost mental health and quality of life. Finally, having a pool can improve a homeowner’s social life. After all, who doesn’t want to throw a private pool party with friends?

    3. Your utility bills will increase

      If you’re thinking of buying a home with a pool or installing a pool in your yard, be prepared for an increase in utility bills. According to HomeAdvisor, homeowners often pay up to $300 a year in electricity just to operate their pool pump. The pump controls the pool’s filtration system and is absolutely essential to maintaining a pool. Those installing a pool in their home will also need to be prepared for an increase in water bills, as it costs anywhere between “$60 and $120 to fill a standard, 15,000 to 30,000-gallon” pool with city water, according to HomeAdvisor.

    4. You’ll need to take certain pool precautions with children

      Sadly, “drowning is the leading cause of injury-related death in children 1 to 4 years old and the second leading cause in kids ages 1 to 15,” according to Parents Magazine. With this in mind, it’s absolutely critical that you and your family take the necessary precautions when buying a house with a pool. Preventative and protective measures include installing a safety fence around the pool, putting locks on the doors leading out to the pool, teaching your children to swim at a young age and setting pool rules with your family.

    5. You’ll need outdoor space for the pool and its equipment

      If the property is small, you may want to think twice before buying a house with a pool or installing one in the backyard. Not only will the pool and deck take up a good chunk of outdoor space, but it will also require extra room to store necessary pool equipment and accessories such as pool vacuums, skimmers, cleaning supplies, floats and towels. So make sure you have plenty of outdoor space to accommodate your pool needs before moving into a home with a pool. 

    6. Your community may require that you install a fence around the perimeter

      Most communities and cities require that homeowners install some sort of fence or gate around the perimeter of their property for safety purposes. This is to prevent strangers from walking off the street and into your pool. Zoning rules vary from community to community, so be sure to check your town’s specifics before installing a pool in your home.

    7. Having a pool may increase your property value (or not)

      Live in a warm weather climate? Having a pool may dramatically increase your property value. In fact, if you live in Florida, Arizona, Southern California or any other warm weather locale, you may be more likely to resell your home if the property has a pool. House hunters in these locations often list having a pool as one of their top priorities. However, if you live in New England or the Midwest, you may be better off skipping the pool. Those who live in cold weather climates often view owning a pool as more of a hazard and hassle. Therefore, house hunters in these areas will be less inclined to want a pool when shopping for a new house.

    8. Your insurance premium will be higher

      Those buying a house with a pool will likely need to increase their liability coverage due to the high incidence of injuries involved with swimming pools. Since the insurance company will be taking on more risk, you’ll likely have to pay a higher annual premium. You may also want to think twice before installing a diving board in the pool. According to Money Crashers, many homeowners insurance policies exclude pools with diving boards and water slides because of their association with increased injuries and higher medical bills. 

    Moving soon?

    So you’ve weighed the pros and cons of having a pool, purchased a new home and are now ready to move. Congrats! Fortunately, Moving.com’s extensive network of reputable and reliable movers makes it easy to book the best moving company for the job. All relocation companies in our network are licensed and insured, so you can rest assured that your move will be in good hands. Best of luck and happy moving!

  • Tips for Winning a Bidding War on a House You Really Want

    Ever found that perfect house only to get out-bid on your offer? In seller’s markets, when demand is high and inventory is low, buyers often have to go above and beyond to make sure their offer stands out from the competition. Sometimes, multiple buyers vying for the same property can end up in a bidding war, both parties trying to sweeten the deal just enough to edge out the other. And while there’s no science behind winning a bidding war on a house, there are things that you can do to up your chances. Here are eight of them.

    Up your offer

    Money talks. Your best bet if you’re set on a winning a bidding war on a house is, you guessed it, offering more money than the other person. Depending on the home’s price, location, and how high the demand is, upping your offer doesn’t have to mean ponying up to pay another ten thousand dollars or more. Sometimes, even going up just a few thousand dollars can make the difference between getting a property and losing out on it.

    One important thing to keep in mind when upping your offer, however: just because you’re ready to pay more for a house doesn’t mean the bank is. When it comes to your mortgage, you’re still only going to be able to get a loan for up to what the house appraises for. So if your higher offer gets accepted, that extra money might be coming out of your own pocket.

    Be ready to show your pre-approval

    Sellers are looking for strong buyers who are going to see a contract through to the end. To let them know how serious you are, it helps to have a pre-approval from your lender clearly stating that you’ll be able to borrow enough money to purchase the house. Make sure that the pre-approval document you show is specific to the property in question (your lender will be able to draft a letter for you; you’ll just have to give them a heads up). If your goal is winning a bidding war on a house where there is just you and another potential buyer and you can easily present your pre-approval, the seller is going to be more inclined to go with the sure thing.

    Increase the amount you’re willing to put down

    If you’re up against another buyer or buyers, it can be incredibly helpful to increase your down payment commitment. A higher down payment means less money will be required from the bank, which is ideal if a bidding war is pushing the price above and beyond what it might appraise for.

    In addition to a verbal promise to increase your down payment, back up your claim with financial proof. Presenting documents such as pay stubs, tax forms, and your 401(k) balance shows that not only are you prepared to put more down, but you also have the funds to do it.

    Waive your contingencies

    Contingencies are certain things that must be met in order to close a deal on a property. If they’re not met, the buyer is allowed to back out without losing any money. By waiving your contingencies—for example, your financial contingency (an agreement that the buyer will only buy the property if they get a large enough loan from the bank) or your inspection contingency (an agreement that the buyer will only buy the property if there aren’t any dealbreaker issues found during the home inspection)—you show just how badly you want to move forward with the deal. It is still possible to back out after waiving your contingencies, but you’ll lose your earnest money.

    There is a risk in waiving contingencies though, as you might imagine. Your contingencies give you the wiggle room you need as a buyer to renegotiate terms and price. So if you waive your inspection contingency and then find out during inspection that the home has serious foundational issues, you’re either going to have to sacrifice your earnest money or pay for expensive repairs once the title has been transferred. However, waiving one or more contingencies in a bidding war could be the extra push you need to get the house. You just have to make sure the risk is worth it.

    Pay in cash

    This obviously isn’t going to apply to everyone, but if you have the cash to cover the purchase price, offer to pay it all up front instead of getting financing. Not only are you eliminating the need for a third party to get involved in the deal, you’re also showing the seller that you mean business. There’s a risk any time a lender has to get involved—when you eliminate their presence, you eliminate the risk. Again though, very few standard buyers are going to have the necessary funds to buy a house outright. If this option doesn’t apply to you, skip it.

    Include an escalation clause

    An escalation clause can be an excellent asset when trying to win a bidding war. Simply put, the escalation clause is an addendum to your offer that states you’re willing to go up by X amount if another buyer matches your offer. More specifically, it dictates that you will raise your offer by a specific increment whenever another bid is made, up to a set limit.

    There’s an argument to be made that escalation clauses show your hand in a way that you might not want to do as a buyer, informing the seller of just how interested you are in the property. However, if winning a bidding war on a house is the end result you’re looking for, there’s nothing wrong with putting it all on the table and letting a seller know how serious you are. Work with your realtor to come up with an escalation clause that fits with both your strategy and your budget.

    Have your inspector on speed dial

    For both the buyer and the seller, a home inspection is a hurdle that has to be jumped before a deal can close, and there’s a lot riding on it. If you want to edge out another buyer, offer to do your inspection right away. This way, the seller doesn’t have to worry that by accepting an offer and taking their property off the market they’re wasting time that could be spent getting something better. You can do this in conjunction with waiving your inspection contingency if you’re really confident you want the house no matter what, or you could agree to a shortened contingency period. The goal here is to speed up the process as much as you can, in turn providing a benefit to both yourself and the seller.

    Get personal

    While money is pretty much always going to be the final deciding factor in a real estate decision, it never hurts to humanize your offer with a personal appeal. If you love a property, let the seller know in a letter. Be open and honest regarding why you feel so strongly about their home and why you think you’re the right buyer for it, and don’t be afraid to get a little emotional. This tactic isn’t going to work on all sellers (and almost certainly not on investors), but on a seller who themselves feels a strong connection to the property, it may make a positive impact.

    Winning a bidding war on a house takes a bit of strategy and a bit of luck. Your realtor will be able to help guide you through each step of the process so that you know you’re making the right decisions at the right times. Be confident, be calm, and trust that if it’s meant to happen, it will.

  • 7 Reasons Why You Should Get Involved in Your HOA

    Moving to a home with a homeowners association? Lucky you. While these organizations often get a bad rap for being expensive and rule-obsessed, they can also make life much easier. Well-managed HOAs typically run everything from your home’s landscaping and exterior aesthetics to pool maintenance and overall upkeep of the property. HOAs also manage finances and enforce rules in housing communities. They are most common in apartment buildings, planned neighborhoods and condo communities where residents live in close proximity to one another.

    If you’re preparing to move to an HOA community, consider joining your board, attending meetings and/or getting involved in neighborhood events. Not only does this make it easier to meet the neighbors, but it also gives you the power to review and change community rules that you find unreasonable. HOA responsibilities and rules vary from property to property, so be sure to thoroughly read your property’s handbook prior to moving.

    If you plan to join your HOA board, start by attending meetings. Every HOA community is different. Some hold meetings once a week, others once a month. To find out more about your HOA specifics, call the property manager for details and/or ask neighbors for information. To become a board member, you’ll need to inquire about elections (when and where they take place) as well as whether or not there are already open spots available. Many HOA boards vote on leadership positions once a year, so be sure to ask about the frequency of these elections. Even if you decide not to join your HOA board, you can still make a difference by showing up to meetings, voicing your opinions and helping out around the community. Here are 7 reasons why it’s important to get involved in your HOA.

    Why you should get involved in your HOA

    1. You can protect the community’s property values

      One of the main roles of the HOA is to help preserve the community’s property values by overseeing the maintenance and upkeep of the individual units as well as the grounds. If the landscaping and recreational areas are well taken care of, then the properties are more likely to uphold their value (or even increase in value). Needless to say, being involved in the HOA gives you more control over these maintenance decisions and therefore, more control over your home’s value.

    2. You can meet new neighbors

      If you’re new to the neighborhood, what better way to meet neighbors and make friends than to get involved in your HOA? Study after study shows making friends is easier when you live in close proximity and see each other on a regular basis. Attending HOA meetings, discussing issues and planning events together will bring you closer to your community and make you feel right at home almost immediately. 

    3. You can change rules and/or make new ones

      Are you annoyed by the fact that you can’t bring food to the community pool area? Or that your neighbor is throwing loud parties every Saturday? If you feel that the rules need to be changed or new rules need to be implemented, joining your HOA board is a step towards modifying the HOA rule book. At the very least, you should attend your HOA meetings to make your opinions known.

    4. You can fix problems in the community

      Whether it’s a problem with neighbors, landscaping or expensive water bills, HOA meetings give residents a platform to address important issues. If you’ve heard the same complaint from more than one neighbor, try creating a petition and/or coming up with solutions to the problem. Being a part of the HOA board allows you to fix problems and change things for the better. 

    5. You can gain leadership skills

      Want to hone your leadership skills in a no-pressure environment? Then joining your HOA board may be the right decision for you. Not only will participating on the HOA board teach you problem solving and strategic thinking skills, but it will also allow you to polish your public speaking and negotiation skills – all of which help your future leadership abilities.

    6. You can plan community events and social activities

      Live in a community where no one talks to each other? It’s time to change that. Join your HOA board to help plan and set up social events and activities to bring people together. Association barbecues, family-friendly outdoor movie nights, chili cook-offs and holiday parties are all great excuses to socialize and get to know your neighbors. If you’re one who especially likes to party plan, then your HOA may need your event planning expertise.    

    7. You can add volunteer experience to your resume

      Looking to beef up your resume? Adding volunteer positions, such as an HOA board member, is never a bad idea. After all, what employer wouldn’t want to see that you’re working hard to improve your neighborhood and overall quality of life? Having this volunteer position on your resume proves that you’re a community-oriented, civic leader.

    What are the benefits to living in an HOA community?

    In addition to zero landscaping (read: you’ll never have to mow a yard ever again!), there are a number of perks that come with living in an HOA community. For one, your utilities (think: water, insurance and electricity) often come rolled up into your HOA fee, simplifying your monthly bill payments. Second, residents of an HOA community benefit from monthly socials and events, making it easier to meet friends and neighbors. Finally, the most popular reason for choosing an HOA community is the access to a number of amenities. Many HOA neighborhoods include golf courses, tennis courts, community parks, swimming pools, fitness clubs and more.  For more information on the pros and cons of HOA living, check here.


  • Ready to Buy? Advice for First-Time Homebuyers

    Buying a home can be a tricky process. For first-time homebuyers, it may seem like the most complicated aspect of a home purchase is finding the perfect property, but that’s really only half the equation (and the fun half, at that). There’s a lot to manage on the back-end, including financing, timing, and big decisions about how and where you want to spend the next however-many-years of your life. It can get stressful and overwhelming, which is why it helps to go into the homebuying process with as clear of an idea as possible about what lies ahead and how to tackle it. Whether you’ve already started your home search or are just embarking on one, this is the advice that all first-time homebuyers should keep in mind.

    1. Know your budget…

      First and foremost: know how much you have to work with. The amount you should spend on a home is a complicated number comprised of how much you’ve got in the bank, how much you’re comfortable spending, and how much you want to take out as a loan. There are other considerations, too, like how much money you need leftover to furnish your home once it’s purchased and whether you’ll need money for repairs or renovations. Simply guessing at your budget isn’t a good strategy, so get the help of an expert early on. It can be a financial advisor, mortgage broker, or someone else who can give you a budget based on your current financial status and your future goals.

    2. …and stick to it

      Money can easily lose meaning when you’re faced with spending so much of it. After all, what’s another ten thousand dollars on a thirty-year mortgage when you’re already borrowing hundreds of thousands? Mortgage lenders will often approve you for way more than you should advisably spend, so it’s important to not just be apprised of your actual budget but to treat it like a ceiling that you can’t go over. Purchasing a home isn’t a decision that only affects you now—it’s an investment in your long-term financial health. So while it will likely be incredibly tempting to spend a little more and get a little more, it’s important to think big picture. That extra $10,000 on a $100,000 loan will mean hundreds of dollars extra year in mortgage payments.

    3. Don’t forget about closing costs

      Speaking of extra money, don’t neglect to factor in closing costs when you’re coming up with your spending limit. You may think you’ll get off easy since the seller usually covers agent commission fees, but there are still a lot of other costs associated with being a buyer: title fees, mortgage insurance, homeowners insurance, underwriting fees, taxes, attorney fees, etc. Together, they can—and often do—run up to ten or twenty thousand dollars. And that’s on top of your down payment. First-time homebuyers aren’t going to have capital from the sale of a previous property, so that’s money you’re going to have to save for and factor in when you’re deciding how much to put down.

    4. Don’t go with the first mortgage you find

      It pays to shop around when it comes to finding the right mortgage. Rates and fees can differ from lender to lender, so if you go with the first one you come across you may be taking on unnecessary additional costs. If you don’t know where to start you can work with a mortgage broker, though keep in mind that you’ll be paying them about 1% to 2% of your total loan rate in fees on closing day. If you’d rather do it on your own, follow these steps from Realtor.comon how to effectively shop for a mortgage.

    5. Put a hold on any activity that might negatively affect your credit

      Your credit plays a big role in both the terms and interest rates of your mortgage. Once you know where you’re at with your credit score, hold off on doing anything that could negatively affect it, such as opening a new credit card, taking out a different loan, or refinancing any existing loans. You can take actions that could work to improve your score—think paying down loans—but for the most part, focus on stability. This is especially true for the period between mortgage approval and closing.

    6. Find a realtor you really like

      First-time homebuyers often start searching on their own. There’s nothing wrong with browsing properties without a realtor (thanks to the internet, it’s way easier to do that than ever before), but you should have an expert on your side when you find a property you’re interested in. An experienced agent is a seasoned pro at all of the things that can be foreign to first-timers in the market, including trends and comps, negotiations, and all the real-estate-specific language that can be super confusing if you’ve never come across it before . In addition to all of that, a realtor will help you schedule showings and help connect you with a reputable attorney and home inspector when you find your ideal home. And just as important as working with a realtor is making sure to work with a realtor you like. Do your research, read reviews, and ask for referrals to find someone who you get along with and who is ready to do their best for you.

    7. Know your dealbreakers…

      You probably have a pretty good idea about what you’re looking for in a home, but what about those things that you know you don’t want? While it’s important to keep an open mind, every homebuyer—first-time homebuyers among them—probably has a general idea of things they can’t overlook, even for the right price. Maybe you know you’re not ready to take on a fixer-upper, or that you’re not willing to add another hour on to your commute. Acknowledging your no-gos is helpful for narrowing down your search, and will help mitigate the chances of future buyer’s regret.

    8. … but look past bad decorating

      Unless you’re buying new construction, there’s a very high chance that most of the potential properties you see are going to have something about them you would change. And while orange kitchens, shag carpeting, and dated window treatments may be tough on the eyes, they can all be changed pretty easily. Don’t let bad decorating turn you off of an otherwise charming home… a house with good bones is worth putting in a little bit of time and effort to make it your own.

    9. Get comfortable with negotiations

      The back and forth negotiations inherent in buying a home can take first-time homebuyers way out of their comfort zone. It may feel weird to ask the seller to bring down their asking price or to make certain repairs—especially if you’re framing it as an ultimatum, wherein you’ll otherwise walk away from the property—but it’s part and parcel of the homebuying process. Compromises are expected to be made on both sides, and when it comes to getting what you want it never hurts to ask. Fortunately, your realtor will be the one actually doing all of the direct communication during negotiations—you’ll almost certainly never meet or speak to the seller yourself.

    10. Think of the future

      Unlike renting an apartment, where you’ll likely be out in a year or two, you’re probably going to be in your first home for half a decade or more. Because of this, you need to factor in not just your current needs but your future needs when you’re choosing the right house. Want to start a family? Make sure you have an extra bedroom or two. Planning to adopt a dog? You’re going to want a yard. Your current needs are important too, but envision how you intend to grow into your home, and give those considerations some weight when you’re making a final decision.

    Here’s a secret that first-time homebuyers should hear but often don’t: there’s no such thing as a perfect house. Even if you think you’ve found it you’re going to find yourself getting annoyed with unexpectedly noisy pipes or summer ant problems or rude neighbors. It’s all part of the general joys of homeownership. Go for the place that makes you feel happy when you walk in the door and that doesn’t overstrain your finances or come with a list of problems that you have to force yourself to overlook. While the perfect home may not exist, yourperfect home is out there—you’ve just got to find it.

  • A Simple Guide to Understanding Real Estate Escrow

    Real estate is filled with unfamiliar terms that can easily throw off a home buyer or seller. Amortization? Balloon mortgages? Equity returns? It’s enough to confuse even the most diligent of non-real estate professionals, and a big part of the reason that it’s so important to work with a good agent when you’re ready to either buy or sell a property. At the top of the list of confusing real estate terms is “escrow,” the name for a process that plays a huge role in a real estate transaction but which many people have trouble fully grasping—including current home purchasers who have paid into escrow without even knowing the what or why behind it. But have no fear—we’re here to break it down for you. Read on for a quick and simple guide to understanding real estate escrow.

    What is real estate escrow?

    Escrow is when a neutral third party holds on to funds during a transaction. In real estate, it’s used as a way to protect both the buyer and seller during the home purchasing process. After a property is purchased, the new homeowner continues to put money into escrow as a means of paying mortgage and insurance payments, though this is a little different than real estate escrow (we’ll get to it later).

    The purpose of escrow is two-fold. It guarantees the seller that the buyer has the funds needed for the purchase and that the money will be handed over once the title is transferred, and it guarantees the buyer that they won’t be scammed by a fraudulent seller who actually holds no claim to a title. Ultimately, escrow helps ensure trust in a high-stakes transaction where neither party may be familiar with each other and where both have a lot to lose.

    Escrow agents

    Escrow is arranged by an escrow agent, a neutral person or entity who is entrusted with holding payments until certain conditions have been met, usually a transfer of title. Because escrow agents play an important role in completing real estate transactions, they are sometimes referred to as title agents.

    You will typically not be responsible for securing your own escrow agent. Instead, your broker or lender will facilitate the process—you just have to supply the money.

    What if you want to choose your own escrow agent?

    As a principal member of the transaction, you do have the right to select your own escrow agent. You may want to do this if you have a strong recommendation for a particular agent, or if you want to be as knowledgeable as you can on the various parties involved in your home sale or purchase. Usually, it is the seller who has the final decision making power on which title company is used for escrow.

    Escrow protections

    Understanding real estate escrow becomes a lot easier once you understand its benefits. Escrow provides assurance for all major parties in a real estate transaction—the buyer, the seller, and the lender—that their interests, and their funds, are protected. Your escrow agent will track and verify the transfer of key variables; most notably, the transfer of the property title from the seller to the buyer and the transfer of funds from the buyer to the seller. It also helps assure the lender that the loan money is going to the right place.

    As a buyer, would you feel comfortable transferring thousands of dollars to a seller you’ve never met without knowing for sure that you would receive the title in return? And as a seller, would you really want to take the risk of handing over a title without a complete guarantee that the buyer is good for the purchase price? Escrow protections help give all parties peace of mind, and help ensure that a real estate transaction goes through as easily as possible.

    Escrow and earnest money

    Escrow and earnest money are two terms that go hand in hand, but they’re not the same thing. Earnest money is an amount paid in to escrow early on in the home purchase process to essentially put a “hold” on the property for the buyer. It’s a way of showing serious intent that the buyer is going to stay true to their offer, and protects sellers from having to deal with buyers putting out multiple offers or going into negotiations on multiple properties. At closing, the earnest money payment is generally taken out of escrow and put toward the buyer’s down payment.

    Escrow vs. escrow account

    Here’s another set of terms that are closely related but not to be confused with each other. Many people have trouble understanding real estate escrow because they mistake it for an escrow account, so it’s important to know the difference.

    An escrow account is a separate account managed by a lender to collect advance insurance payments and tax payments from a homeowner. Usually, a lender will add up the total amount due for these payments in a year, divide it by 12, and tack on that extra amount to each mortgage payment. When those payments are due to either a homeowners insuranceagency or the IRS, the lender pays them for the homeowner out of the escrow account. Many states, but not all, require lenders to pay interest to homeowners on their escrow account.

    Online escrow companies

    If you’ve done any previous research on escrow, you may have come across online escrow companies. While the main goal of online escrow is similar to that of real estate escrow, online escrow companies help build trust between buyers and sellers in online purchases—not in real estate transactions. For example, if you wanted to buy an expensive used car through an auction site, you would want to hold your payment in escrow until the car has been delivered, instead of just crossing your fingers and hoping that you’re not being scammed.

    Though the idea behind real estate escrow and online escrow are very much the same, you won’t be using an online escrow company to buy or sell a home. Your escrow agent will be either a qualified attorney or a third party institution pre-approved by your broker or lender or chosen by the seller based on reliable recommendations.

    The escrow process

    By this point, you should have a good idea of what escrow is, but what about the process behind it? The escrow amount generally ranges from between 1% to 3% of the total sale price, and is deposited into escrow after an offer is accepted by the seller. The neutral third party safely holds on to the funds until closing when the sale is finalized and the title is transferred over. The total time that funds sit in escrow depends on the length of the closing period. During escrow, the funds are inaccessible by both the buyer and the seller. If the deal falls through, the escrow funds will be returned to the buyer.

    Your role in the escrow process

    As the buyer or seller in a real estate transaction, you play an important role in the escrow process. In addition to the buyer being responsible for depositing funds into escrow on time, there are several other things that both parties can do to make the process run smoothly. These include:

    • Reading over all escrow-related documents and making sure that you understand them. If you have a question or need some more clarification, ask your real estate agent or lender to help you.
    • Being available to quickly respond to any questions or necessary next steps as the process moves forward.
    • Giving the closing documents a thorough read through so that there are no surprises or last-minute questions once the deal is ready to be finalized.
    • Holding on to your escrow-related documents for administrative and tax purposes.

    Most of the real work on escrow will be done behind the scenes, with the neutral third party responsible for collecting and dispersing funds at the right time. If you ever have any questions about your escrow, including timing, speak with your lender directly.

    Understanding real estate escrow is all about understanding why it exists in the first place. And while it may seem like just one more expensive task in the closing process, its benefits for both buyers and sellers mean that it’s well worth a couple of extra steps. Buying or selling a home is a major transaction, and the more protections each party has in place, the better. As confusing as escrow might be, it’s an essential part of ensuring that your real estate transaction is a success.

  • “How Much is My House Worth?” 4 Ways to Find Out

    t’s important for homeowners to always have a good idea of their property’s value, even when they’re not planning on moving any time soon. As with any major investment, asking the important question: “how much is my house worth?” and following up with regular checks on how the value is changing (or not changing) is a critical part of ensuring long-term financial health. And thankfully, there are a number of easy—and usually free—ways to check in and receive an up-to-date analysis of a home’s current market value.

    There are multiple of reasons to keep a close eye on what your home is worth, including and aside from possibly wanting to sell it soon. For starters, your home is part of your net worth, which is itself a good indicator of your current financial well-being. And because you never know when you might want to take out a home equity line of credit, it’s good to always have a general idea of what you could borrow against.

    Of course, “how much is my house worth?” is, ultimately, about knowing how much you can get for it if you decide to sell. Many real estate professionals recommend keeping tabs on your property’s value in the two or three years leading up to when you want to list it so that you can track any key trends and, if feasible, take advantage of an upswing if it presents itself.

    So how do you figure out how much a home is worth? Here are four ways.

    1. Use an automated home value estimate tool

      Probably the easiest way to receive an estimate on the value of your home is to enter your information into Realtor.com’s home value tool. Just type in your address and you’ll receive a free estimate on the current price, as well as a comparison of how your home’s value compares to the median prices of homes both listed and sold in your neighborhood. You’ll also get a clear visual of the general market trend for your town.

      As a bonus, if your home’s estimated value raises more questions than answers for you, or if you just want to dig deeper into nearby market trends, you can easily request a free analysis from local agents right on the same page.

    2. Ask a real estate agent

      Nobody has a better handle on your local market than the real estate agents who help people buy and sell homes there. And fortunately, most agents will be happy to help you figure out your home’s estimated worth for free or no cost in the hopes that when you are ready to sell they’ll be the first ones you call.

      When choosing an agent for the job, look for the same things you’d look for if you were searching out someone to sell your home for you. Ask around for recommendations from trusted friends and family members, read online reviews, and find someone who you click with. The agent will use public records to determine your home’s value, primarily data on recent home sales in your area. They’ll also be able to factor in things about your home that may have an effect on its value, like high-demand features and improvements.

    3. Do your own comp analysis

      You don’t have to be a licensed agent to access the information that helps determine a home’s estimated worth. “Comps,” which is short for comparables, refers to the value of similar properties in your neighborhood—figures that help inform what your own home is worth. The best comps come from properties that are in the same location (think narrowly; not just your town but the specific area of it that you live in) and that have similar square footage and features.

      When it comes to a comp analysis, actual sale prices are much more telling than list prices, since they speak more to a property’s real value. Browse your local MLS page or head back to Realtor.com’s home estimate tool and start plugging in addresses. If a home has recently sold, you’ll see the price it sold for and when the sale took place. Otherwise, you’ll see an estimate of the home’s current value.

      For the most thorough comp analysis possible, you’ll also need to factor in additional information about your home that will affect its worth. Things like updates, upgrades, and a finished basement will all have an impact on what its market value might be. It’s difficult to determine the exact value of these factors without the help of an agent, but figure you’ll get a boost for upgrades like stainless steel appliances, extra bedrooms, and that aforementioned finished basement.

    4. Get an appraisal

      Appraisals aren’t limited just to times when you’re selling or refinancing a home. Homeowners are free to hire a professional appraiser to come in and give them an estimate of their property’s value whenever they’d like, though keep in mind that this is a service you’ll have to pay for.

      An appraiser can offer one of the most comprehensive price estimates possible because they consider a wide range of value-affecting factors, including comps, interior and exterior property characteristics, and local market trends. They’ll even be able to make key determinations based on less quantifiable factors such as the flow and functionality of your floor plan.

      Be sure to only work with an appraiser who is licensed or certified and has experience in your particular market.

    The bottom line

    How much your house is worth is a combination of both real and perceived variables. No estimate is perfect though—the only value that really matters is the amount you can get from your buyer or the bank. But if you keep on top of your home’s estimated value, as well as the trends dictating your local market, you won’t have to worry about facing sticker shock when the time comes to find out what your property is really valued at.

    If you’re ready to sell, start looking at comps and get an online estimate early on in the process. While your real estate agent will help you set the best price for your home, it can be incredibly helpful to do a bit of your own research so you’re not completely out of the loop on how and why your home is being priced as it is.

  • 16 Easy Ways to Boost Your Home’s Curb Appeal

    Could your home use a bit of extra curb appeal? Your home’s exterior is like the cover of a book, setting the stage for what’s inside. And whether you’re interested in selling or just want to make some improvements for your own enjoyment, adding curb appeal is often an easy and inexpensive way to make your house look nicer and boost its value. Here are 16 projects that will help your home make a better first impression.

    1. Go green

      One of the most obvious (and most impactful) ways to boost curb appeal is to add some fresh greenery and flowers. Don’t worry if you don’t have the time or money to spend on putting in a garden—you can get the same effect by adding some planters and window boxes. Use plants to accentuate and frame key visual points, like windows and entryways, and if you don’t have room for a standing planter, hook up a hanging one. Even just one pretty plant arrangement can significantly add to your home’s exterior appearance.

    2. Take care of your lawn

      While we’re talking green thumbs, it’s important to note that lawn care is a big part of maintaining curb appeal. Regularly care for your lawn by mowing the grass, raking off leaves, and pulling weeds. Keep it well watered to prevent brown spots. As long as you keep up with it, lawn care won’t become a huge project. Live somewhere dry where grass has a tough time taking hold? Consider lawn alternatives like shrub beds or artificial turf.

    3. Make your door pop

      Boost curb appeal by having your front door stand out instead of blend in. Painting a front door only costs about $75, and is a pretty easy DIY job, even for beginners. Opt for a bold color that accentuates and enhances (rather than clashes with) the other colors of your home’s exterior. Don’t be afraid to go bright, but do hold up a swatch before painting to ensure the final product will be what you’re looking for. You can also use the Front Door Paint app, which lets you virtually test out different colors.

    4. Let there be light

      There’s nothing welcoming about a dark entryway. If you already have a sconce or hanging pendant by your front door, replace it with something a bit more fun and fresh. Clean off all cobwebs and debris around outdoor light fixtures, which will instantly make the space appear more bright and clean. If you need some additional light sources, hang some porch string lights or use solar powered lanterns to light up a walkway.

    5. Embrace symmetry

      Symmetrical patterns create focal points that are pleasing to look at and instantly make your home look more put together. Achieve the look by putting matching wall lanterns or plants on either side of your front door. If you don’t have room at your entryway, you can do the same thing around your garage door.

    6. Makeover your mailbox

      Swap out a dated mailbox with something more stylish. It’s a super easy project to take on, and can make an understated but noticeable difference in your home’s curb appeal. Depending on the type of mailbox that you need (i.e. a standing mailbox or one that’s attached to the wall), plan on spending about $50-$200 to replace it.

    7. Clean your gutters

      Clean gutters both inside and out, clearing out any debris and really scrubbing the outsides until they look good as new (or as close to new as you can get them looking). You’ll be in awe at what a little elbow grease can do.

    8. Add some front door décor

      Wreaths aren’t only for Christmas. You can find wreaths year-round that add an exceptional dose of added beauty to your front door. Look for wreaths made from dried or preserved greens and florals, or make your life even easier by purchasing one made from faux plants. Avoid seasonal elements that can date a wreath and make it appear out of place. Instead, go with something simple that can add elegance throughout an entire season.

    9. Upgrade your house numbers

      Quickly modernize the look of your home by removing your old house numbers and replacing them with something that has a bit more oomph. Choose a font that aligns with the architecture of your home but that is also distinctive enough to really grab the eye. Even if you’re not super handy, replacing the numbers is an easy job that can be done in about half an hour or less.

    10. Hide electrical fixtures

      An electrical box on the front of your house can really stand out, and not in a good way. Fortunately, a quick paint job can camouflage the fixture so it blends in instead of being an eyesore. Go with a color that’s the same as your home’s siding, and follow these tips for painting it correctly.

    11. Power wash it off

      There are few things more satisfying than power washing years of dirt and grime off your siding, porch, walkway, and driveway. If you don’t own a power washer, you can rent one from a big box hardware store like Home Depot or Lowe’s.

    12. Stain your garage door

      A new garage door is expensive, but you can get the look of a new door for a lot less money simply by staining it a new color. Start by power washing the door to get the surface completely clean, then paint your stain on. Here’s an easy guide for how to do it right.

    13. Fix it up

      Take care of any small repairs, like ripped screens, burned out bulbs, or chipped paint. Even tiny flaws can stand out against an otherwise picturesque exterior, so it’s worth taking a day to fix them. Walk around the outside of your house noting anything that requires a quick fix, and then get the tools you need and get to work.

    14. Design a clear path

      A well-defined path makes your home look more inviting and put together. You can go big and build one out of stone or brick, or you can just use visual cues like lighting and plants to line a clear path to your front door through the grass or around an existing concrete walkway.

    15. Utilize outdoor furniture smartly

      Too much outdoor furniture can clutter your home’s appearance, while too little can make it look scarce or neglected. Try to find a good balance somewhere in the middle, and be sure that all outdoor furniture you have is clean and in good condition. For small yards, think about putting in simple ceramic stools for seating and add some extra charm by setting up a small table with a pretty planter on the top.

    16. Add new door hardware

      Replace your front door’s existing hardware with something new for a quick and noticeable upgrade. Choose a color that contrasts with your door’s paint color, such as black hardware on a white door or brass hardware on a black door. Take it a step further by adding a fun door knocker for guests to use when they come by.

    Giving your home a curb appeal boost can be done in just a day or weekend if you plan ahead and prioritize the projects that will really make a difference. Chances are, your home already has plenty of beautiful elements and it just needs some finishing touches to really look its best. Put some time and effort into it and you’ll be amazed by the results.

  • Spring Cleaning Checklist 2019

     Free Printable Spring Cleaning Checklist from Mom4Real.com

  • There Goes the Neighborhood: Watch Out for These 7 Red Flags When Buying a Home

    Finally, you've done it: You've scoured the market for available homes—and then some—and found one you can't stop thinking about. It's time to make an offer!

    But before you put your money on the line, take a peek around the neighborhood. We won't use a certain cliché, but there is a reason the pros emphasize location when buying real estate. You can change your house—but you can't change the neighborhood. And if your hood is on the decline, you just might have a helluva time offloading your home when you decide to sell.

    A bad neighborhood isn't always obvious, though; sometimes you need to do a little digging to know if a community is worth buying in. Luckily, we've identified seven red flags that should give you pause before you sign on the dotted line.

     

    Red flag No.1: Too many houses are on the market

    There's nothing wrong with two or three listed houses on the same street. But if you see an army of "For Sale" signs, consider looking elsewhere.

    "This points to illiquidity in the market and pricing pressure, which is a risk for buyers," says Alison Bernstein, the founder of Suburban Jungle, which helps families find their ideal suburb.

     Of course, the hue of this particular red flag depends on the reason for those "For Sale" signs. Perhaps the neighborhood is rapidly gentrifying and longtime 

     residents have decided to cash in. Maybe there are many older residents who are downsizing. Or maybe there's a more sinister explanation, like increasing crime rates. Do your homework to assess the situation before making any big moves.

     

    Red flag No.2: The schools are enrolling fewer students

    Schools in healthy communities should be steadily increasing their enrollment—or at least keeping the population steady, if there's no physical room to grow.

    "Shrinking class sizes are a red flag," Bernstein says.

    There are a number of reasons enrollment might decrease. Your local school might have a reputation for poor management, sending parents fleeing to charter or private options. Or perhaps residents are staying put as their kids grow up, leading to older neighbors and fewer close-by pals for your kids. That may or may not be a deal breaker, but it's certainly something to consider.

    Red flag No.3: The area leans industrial

    A nearby strip of cute boutique stores might be a nice selling point, but reconsider the purchase if the closest commercial influences lean toward the industrial.

    "Be mindful of any kind of commercial influence on the block, such as close gas stations or anything that could be undesirable health-wise," says Ralph DiBugnara, the vice president at Residential Home Funding.

    Any nearby industrial plants should automatically nix a neighborhood, and think long and hard before buying across from a car dealership or auto body shop, which attract a lot of car traffic.

    Red flag No.4: There are lots of empty storefronts

    Don't just stop at counting boutiques versus gas stations. Are the stores actually thriving, or are there lots of retail spaces for rent?

    "Empty storefronts can tell you a lot," Bernstein says. "They point to less disposable income of residents than clearly there once was."

    Why does that matter? Decreased disposable income indicates a neighborhood on the decline. If homeowners don't have money for dinner out, they probably don't have cash for upkeep. Shabby homes drag down property values. Meager cash flow can also lead to future foreclosures—and a foreclosed-upon home is a neighbor that no one wants.

    Red flag No. 5: The Stepford style is in full force

    You might love the homogenous, well-groomed suburban look (and there's nothing wrong with that!). But take a moment to examine it more closely. Are there any unique decorative doodads dotting each garden, like aluminum chickens or wind chimes? Or is the front porch furniture identical?

    If all the neighborhood's homes (and landscaping) look suspiciously similar, "explore how restrictive the homeowners association is," says Susanna Haynie, a Realtor in Colorado Springs, Co. "It could be an issue."

    Red flag No.6: There's no parking

    Sure, the property may have a one-car garage—but where will your friends park, and where can you keep your spouse's car? If the streets have bumper-to-bumper traffic, think twice about buying in the neighborhood—especially if the home lacks a garage or carport.

    "I'm always on the lookout for a lack of parking," DiBugnara say. "It's best to visit at night or on weekends to really, truly tell what will be available to you once you live there."

    Unless you commute primarily by foot or bike—or you're OK spending your weekends circling the block—the neighborhood may not be a good fit for you.

    Red flag No.7: Surrounding homes aren't well-maintained

    A street in shambles might seem like an obvious red flag. But you also might have heard that buying the best house in the worst neighborhoodis a prime opportunity for profit.

    Tread lightly here: A street full of run-down homes with overgrown yards and broken fences should set off warning signals. And this has nothing to do with wealth; lower-income neighborhoods can be just as well-kept as more expensive ones. It's about pride. Neighbors with no pride in their home's appearance and upkeep decrease property values for everyone.

    Plus, problems with the homes next door can indicate that the house you want might have bigger issues than meet the eye. Look at every house on the block for issues such as water pooling in the yards, or flickering porch lights.

    "If there are problems such as water pipes or electrical issues, you will tend to see more than one home showing damage," DiBugnara says. Fixing these major problems "could be a major expense, hassle, or detriment to your value later on."

  • 8 Mistakes to Avoid When Buying and Selling at the Same Time

    Plenty of people find themselves buying and selling a home simultaneously, but knowing that others have gone through the same stress does not make it one bit easier. After all, the stakes are so high: If your buyer backs out, you don't have any cash to land your next home! Or if your own purchase falls through but your current home sells, you're homeless!

    It's all like walking across the Grand Canyon on a tightrope: The tiniest thing goes wrong, and you fall.

    Breathe in. Don't panic.

     It turns out that most buying-and-selling mistakes are easily avoidable—or at least predictable. Follow these eight tips to enter escrow with eyes wide open.

    1. Waiting too long to prep your home for selling

    Every home needs a little work before selling. You might need to repaint some scratched walls, fix broken decking, or add grout in a rarely used bathroom. Don't wait until the last minute to kick-start this process, otherwise you could wind up in a bind.

     Take, for example, one of the clients of real estate associate Kenneth Er. He was trying to buy and sell simultaneously. Er advised him repeatedly to start prepping the home, "but he kept pushing it off and pushing it off, despite actively looking for a new home and submitting offers."

    Once the client went under contract to buy a home, suddenly he and Er found themselves rushing to list his existing home. When they finally finished prepping, it was already October—precisely when the market was slowing down and it became tougher to find a buyer.

    "I advised him—and would advise anyone—to get the little projects out of the way," Er says.

    2. Skipping the backup plan

    When you're buying and selling simultaneously, the number of moving parts doubles. And if any of those parts gets jammed, it can throw off both transactions.

    For example, Miami Realtor® Juan P. Rojas was recently involved in a three-way transaction where the sellers of property A wanted to buy property B—and the sellers of property B wanted to buy property C.

    "We had to coordinate two closes and three different families moving in and out of properties," he recalls.

    It worked out, but Rojas cautions: "Assume that you won't be able to buy and sell at exactly the same time."

    And with that assumption, you better have a plan in place in case everything goes wrong. Keep your emergency fund well-stocked. In a best-case scenario, you may simply need a hotel for a week, but you may also find yourself looking into short-term rentals. Have cash on hand—in addition to your down payment funds—to survive the setback.

    3. Buying too big

    "One of the biggest mistakes that we see that simultaneous buyers and sellers make is the same one that many first-time buyers make: They fail to get pre-approved on their new loan," says Orange Country Realtor Jessica Althoff.

    Pre-approval is essential, because it puts a stop to unrealistic dreaming by telling you exactly what size of house you can afford.

    "Buyers assume that with a large down payment and increased income, they will automatically qualify for a larger home loan," she says. "Many do, but not as large as they think or wish. They begin the search and are disappointed when they can't upgrade as much as they thought they would be able to."

     

    4. Working with too little cushion

    You know what price your house should sell for. But what if the market softens? If you're forced to take an offer that's $20,000 less than expected, there goes the down payment on your new home.

    "Give yourself a cushion on what you need to sell your existing home for," Er says.

    If you're hoping to use the entire sale price as a down payment on another home, move forward with the assumption your home will sell for less than expected.

    One of Er's clients set a purchase budget of $2.2 million. In order to afford his new home, he needed to sell his home for about $1.3 million. Not only did he exceed his purchasing budget, Er says, "We're unlikely to get $1.3 million for his current home, due to the softening market and the time of the year. He's stressed out and scrambling."

    5. Failing to compromise

    Don't forget you're not the only human in a stressful situation. That person selling your dream home? And the buyers under contract for your current place? They're all probably stressed, too.

    So keep that in mind when issues come up—for example, if the buyers need an extra week of escrow because there was an issue selling their home, or the sellers don't think they need to fix a leaky pipe for you.

    "One mistake is expecting so much from the people selling the home, but not being willing to give anything to the buyers of their own home," Althoff says. "A little compromise goes a long way, especially when there are two escrows (or more) on the line."

    6. Using two different real estate agents

    Expect this already messy process to get even messier if you're juggling agents for your listing and for buying a new home. Simplify things by using the same agent for both transactions.

    "I would always prefer to handle both sides of your sale and purchase," says agent Michael Pacheco. "Having control and insight over both transactions allows me to make sure that we close both homes simultaneously."

    There are two instances when you should not use the same real estate agent. If you're moving out of state, look for a reputable buyer's agent in your new location. If you're remaining in the same area, you may also meet and like an agent who works exclusively with buyers or sellers — not both. In that case, ask for a recommendation within your agent's brokerage so you can, at a minimum, keep both transactions under the same roof.

    7. Closing on a Friday...

    While you should work with your agent to determine the best timing, you'd ideally want to finalize the sale of your current home first, and then close on your new one. Try to aim for closings within two or three days of the other—"and never on a Friday," says Realtor Karen Choate.

    That's because bank transfers can take a few days to go through. In order to ensure there's money in your account when the time comes, buffer a few days to transfer funds.

    8. ...or late in the afternoon

    When you're scheduling those closings, aim for the morning—especially on the sale of your current home.

    "Banks usually stop wire transfers by 3 p.m. in the time zone where the property is located," says Choate. Closing in the morning allows extra time for the money to hit your account.

  • Hey, Big Spender! 6 Reasons Why Your Higher Offer Won't Win the House

    You've finally found your dream home, and it's actually in your budget. You can swing it—with cash to spare—but with competition fierce, why not go all in and offer way above asking? The seller will be in no position to refuse, right?

    Well, hang on for a second. While cash—and lots of it—is certainly king, there are other factors that play into a seller’s decision to accept an offer.

    In fact, sometimes there are things in your purchase contract that can outweigh even your supersized offer. Sounds crazy, doesn’t it? But often—especially in today's red-hot market—a successful sale goes beyond money. Here are a few scenarios in which your highest offer might not land you the keys to the front door.

     

    1. You're not flexible on the timeline

    First and foremost among possible deal breakers is timing.

    “Sellers look at the terms to their specific situation," says Francine Brown, broker/owner and Realtor® at Brown Estate Realty in Norwalk, CT. "Maybe they need more than 30 days to move out, so if someone is pressuring them to move out sooner, that can sometimes be a turnoff if they haven't found a new home to move into.”

     On the other hand, the sellers might have already vacated the property, and are eager to unload it pronto.

     That’s why customizing the length of the closing period to meet the sellers' needs can be more important than the bottom line. Have your real estate agent find out what they need, and let them know you can accommodate them.

     

    2. You don't have your paperwork squared away

    Yes, we've preached and prattled on about the importance of being pre-approved for a mortgage before you start your home search. And here's just one of many reasons why: You can blow up the deal if you haven’t been pre-approved, says Sharon Paxson, a Realtor with Arbor Real Estate in Newport Beach, CA.

    Why? If you don't have the financing in place to make your initial down payment and closing costs, it doesn't matter how many dollars you promise the sellers.

    “Buyers must have that in place as opposed to tying up a house when they're not really qualified to do so,” Paxson says. “When you're ready to put in an offer, make sure your pre-approval is within 30 days or less. [If sellers] see that the pre-approval was done more than 60 days ago, that could make them wonder if you're still credit-worthy to get a loan."

    Speaking of being credit-worthy, here’s another no-no: Making a large purchase (such as a car) during the escrow period—even if you have the money to do so. It might affect your ability to obtain financing, and that'll be another major red flag to the seller.

    3. You're asking for too many contingencies and concessions

    If you’re in a bidding war for your must-have home, you’ll want to go in not only with the highest offer, but also with the cleanest one.

    “You want the deal to be as sweet and competitive as possible, so that if the seller takes it, there's a very good chance that the sale will go through,” Paxson says.

    For example, a contingency stipulating that your home must sell before you purchase the seller’s house is usually a deal breaker, Brown says.

    “The seller may not consider your offer as favorable because you're still shaky until your house actually sells,” she says.

    Another potential turnoff: Negotiating for a large concession, like for the seller to pay all of the closing costs.

    Instead, ask for the bare minimum closing costs—or none at all—and make sure the concession doesn't dip into the seller's price tag, Paxson advises.

    “So if a house is listed for $300,000, and you can go up to $310,00, then put in $310,000 with a $10,000 seller's concession,” she says.

     

    4. You're requesting too many things be included with the home

    On a related note: If you ask for the custom drapes, the Smeg appliances, and the Scandinavian hot tub to all be thrown in with the house, sellers might wave you off, Brown says.

    “If the sellers had put in the listing that the chandelier wasn't included, then don’t ask for it to be thrown in,” Brown says.

    You might think you're paying for all that stuff with your higher offer, but if you really want the house, tread lightly here. You risk offending the sellers if it looks like you're trying to squeeze as much out of them as possible.

    5. You haven't expressed your love—for the house

    You might not be the only one bidding high. And when similar offers are on the table, sometimes the sellers look for other factors to break the tie—that another happy family will live in their cherished home, for example. Or that the buyers won’t be gutting it and turning it into something totally different.

    So how can you sway sellers who love their home? Put some heart into your offer by giving them some idea of who you are and why you want their home.

    “I’ve seen buyers take a picture of themselves and their family. If that’s what works to make it more emotional, then do it," Paxson says. "It just depends on who your target is. If your seller is an investor, they’re probably not going to care—they just want the money. But if they raised their family there and want to sell it to another nice family, an emotional appeal might work.”

    Writing a love letter to the sellers can sometimes seal the deal, Brown adds.

    “A buyer may outline why they feel this house would suit their family needs and how they can keep on the tradition of what the previous owner has,” she says.

    6. You gave up after your offer was initially refused

    If, for whatever reason, the sellers reject your bid, hang in there, Brown says. Contracts that come in way over asking price tend to have a high cancellation rate, perhaps because the buyers didn’t have pre-approval and their financing falls through.

    “I make sure things always end nicely with the listing agent, and tell them that we want to be kept in the loop should there be any problems with the accepted offer,” she says.

    Ask your agent to check in every two or three weeks. Because then, instead of putting it back on the market and creating a whole new bidding war, the listing agent may just go to the next most attractive offer: yours.

  • 7 Things House Hunters Should Do Before Even Setting Foot in a Home

    Once you decide to buy a home, the first thing you (understandably) want to do is pop into open houses and fantasize about your new life in your new digs.

    It is a crucial part of the process. But jumping straight into the deep end could land you in trouble—both financially and emotionally.

    Take it from me: When my husband and I bought our first house, we launched into the search without prepping properly. We fell in love with a two-bedroom bungalow far too quickly (it was one of the first homes we saw), and spent the entire closing process playing catch-up. We rushed to get a loan approved; we scrambled to understand our contingency options; and in the end, the home turned out not to be exactly what we needed.

     I've made a promise to myself: Next time, I'll think things through and prevent buyer's remorse. And I urge you to, too. I talked with real estate pros to find out the things you should do before you ever set foot in a home.

    1. Get your credit in order

    Good credit is essential when buying a home. A poor credit score can lead to a higher interest rate and, by extension, a higher monthly payment. Dings on your credit—e.g., an old debt that's been turned over to a collection agency, or a high credit card balance—can even prevent you from buying a home.

     "You would think that, having heard so much about credit, people would know exactly what their credit is, but often they don't," says Marie Bromberg, a real estate agent with Corcoran in Brooklyn, NY. "Not knowing sets you back—a difference of 10 points can make a significant difference in your loan product."

     Before you start house hunting, pull your credit report (AnnualCreditReport.com is a reputable and free service) and address any problems dragging down your score.

    2. Get pre-approved

    Before setting foot in a home, find a reputable lender and get pre-approved. Let us be clear: This is not a simple pre-qualification; a pre-approval uncovers exactly how much house you can afford and is an essential component of a successful offer letter.

    "Your offer means nothing without showing a pre-approval letter," says California real estate agent Shelton Wilder.

    Don't have a lender yet? Don't worry. Your agent can recommend local lenders, or you can seek out recommendations from other homeowners. Once you've settled on a lender you like, have the lender review your finances thoroughly to point out any concerns.

    3. Make a list of your must-haves

    Finally, the fun part! Now you get to start browsing home listings. In fact, feel free to start obsessively refreshing realtor.com for listings in your desired area months before you start seriously looking.

    Just make sure to take extensive notes of everything you love: Do you want to be in a specific school district? Are you eager for an en suite master bathroom? Is a basement a must-have?

    "Then, pick your absolute top three and hold firm on those," says Dolly Hertz, a broker with Engel and Völkers in New York City. "If you get the rest of your longer list, or even a few of them, you're ahead of the game."

    If you have this list prepared and in hand when you visit your first home with your agent, you won't be prone to making impulsive decisions based on your gut, or getting starry-eyed over gorgeous architectural details that don't actually meet your needs.

    4. Review a residential purchase agreement

    It might feel like you're jumping the gun to think about the contract to buy a home before you even start looking for one. But home buying involves a flurry of paperwork, and you should understand what you'll sign before you're under pressure. Review a sample residential purchase agreement with your agent beforehand so you can head into this nerve-wracking process with open eyes.

    "Sometimes in the home-buying process, especially in a seller's market, the process can go so quickly that buyers don't know what they are signing and what the contingencies mean," Wilder says.

    For instance, if you're selling and buying simultaneously, you might want to include a "home sale contingency," which makes the purchase dependent on successfully selling your own home. Or you might include an inspection contingency, so that you'll have the option to back out if serious flaws are uncovered.

    5. Prepare to be flexible

    The home-buying process is filled with highs and lows. You might find a home that fits most of your criteria—but misses the mark in one big way. You might be forced to compromise, or move to an area you didn't expect.

    Before you dive in, "take a deep breath and promise yourself to be as flexible as possible," Hertz says. "You may fall in love with the kind of place you never thought you would consider."

    As an example, she recalls the search for her current home. Early on, she was "set on living in a particular town and only that town." She and her husband spent 10 months looking at homes that didn't fit the bill.

    Then, "quite by accident, my husband found a listing ad that looked intriguing, in a neighboring town we had never even heard of," she explains. "You can guess the rest: Not only was it love at first sight, but 28 years later, it still is."

    6. Explore all of your loan options

    "Often, first-time home buyers automatically sign up for the 30-year fixed," Bromberg says. "But often there are alternatives that will work for them, but are not explored."

    If you're buying a small home or studio, you likely won't stay for 30 years. Perhaps a shorter mortgage term could be useful. Or, if you have big pockets but can't quite afford an all-cash offer and find yourself repeatedly losing in bidding wars, Bromberg recommends the delayed financing option, which lets you pay cash upfront for the house—and then get a mortgage for the home after closing.

    7. Fill your cash reserves

    Don't just save up for a down payment. Make sure you've stuffed your emergency fund, too.

    In addition to having the down payment in your bank account, Wilder says, you should have an emergency fund that amounts to several months of what the mortgage payments would be.

    Having this money before you start the home search will help the loan process—it proves you're fiscally sound. And, of course, it also buffers against any potential surprises once you get the house, like a brand-new water heater going kaput.

    Don't set foot in a home without preparing yourself emotionally and financially. Laying the proper groundwork guarantees good decisions—and a home you'll adore.

  • How banks are helping you budget and track your money to avoid overspending

    What if mom always could be at your side and make you think twice about whether you really should spend an extra $50 on yet another night out with the girls? 

    OK, who really wants to hear from mom all the time? But what about your bank? Could you give up mindless spending if you got a nudge from your banker?

    As we move into the season of New Year's resolutions, expect to hear more from banks and others about how to do a better job at tracking your spending and saving more money.

    "You might not always love what you're hearing. But everybody needs a coach, a mom or a friend," said Andy Harmening, senior executive vice president, consumer and business banking director for Huntington Bank, which operates in eight states, primarily in the Midwest. 

    Huntington is running ads now that highlight a "Heads Up" alert where customers can set a monthly amount to spend on shopping, groceries or restaurants, or whatever.

    Then, during the month, the bank sends a heads up via your mobile phone, laptop or computer to keep you on track. You might get a notice like: "You've spent $300 of your $400 budget for groceries this month." 

    Can a drone stop you from spending? 

    One of the Huntington TV ads uses a clever "spending drone" that hovers above a couple on a special date night in a fancy restaurant. The young man starts out trying to order "oysters." The drone says: "Over budget." He moves on to "lobster." The drone says: "Over budget." 

    You get the picture. Soon, you'd expect the couple to run out the door, jump in the car and head to a more budget-friendly spot with a drive thru. Stay tuned. 

    The bank can help consumers who want to participate track spending by category as the customer uses Huntington debit and credit cards.

    The bank can help you get started by setting up a few budget categories based on your spending history. Beginning in early 2019, the Heads Up program will integrate artificial intelligence tools to provide customers with up to 40 key insights into their financial wellness as they set goals. 

    Talking about money around the kitchen table

    Harmening said the "Heads Up" approach came out of focus meetings where bankers literally sat with customers in their homes around the kitchen table asking them what matters the most to them. He said the "proverbial kitchen table" is the centerpiece of where real conversations happen. 

    The bank created what it calls "The Hub," a new digital banking experience that's free to all its customers. The bank is able to review spending trends for the past 12 months and help people set a budget. The bank's philosophy is that it's not just big events that require some planning and a heads up. Little everyday moments need some financial planning, too. 

    The game plan includes helping customers categorize their spending so they can better understand how to change some habits going forward. Customers also are able to set up a monthly spending limit by category. So if you only want to spend $100 a month on eating out, you'd do a better job tracking that spending throughout the month. 

     A look-ahead calendar also provides a financial view of the month to come, so customers get a better handle on when bills and deposits will hit their accounts and plan accordingly. 

    Such programs can help customers review where they're already spending money. As a result, for example, customers may find it easier to spot recurring subscriptions to services they didn't even realize they were still paying for but not using.

    Customers said they wanted help keeping their financial goals front and center, according to Huntington. 

    "They said: 'Make it easy. Be proactive. We might not always appreciate it. But we need it,' " Harmening said. 

    Watch out for big and small money drains

    Most people can use some help tracking the big money drains in their life. Maybe it's all that money they're spending buying lunch each day. Or getting a coffee on the way to work. Or splurging on a new video game or a new sweater a few times a month.

    Maybe you spend too much money when you're trying to impress a date. Or you're overtired and shopping online late at night. 

    In the old days, people would talk about using spending envelopes to set aside cash that you can use on groceries or rent. Or people would be encouraged to write down how much they were spending each day on incidentals. 

    Now we're living in a digital world where you are able to set up another sort of system. For those already facing big bills, tracking small expenditures really can add up and help with a budget.

    Take someone who is juggling college loan payments. "What happens with student lending is it creates pressure on your cash flow," Harmening said. 

    But if you're able to suddenly save an extra $100 or $200 a month, it makes it a lot easier to pay that $300 student loan bill each month. 

    Kicking mindless money habits is a theme that we'll likely hear more about in the New Year. 

    After big spending moments – which can include everything from Black Friday and Cyber Monday sales to holiday gift giving and trips to visit family – plenty of households start out 2019 in the red. Even finding small ways to cut back right now can help as many wait it out before receiving a big tax refund in February or March. 

    Take something out of the cart and put it back

    Ally Bank announced in late December that it put 48 of its customers to a test of sorts with four savings challenges to overcome "absent-minded and needless spending habits."  

    On average, the bank said, the customers found they could easily save $50 using just one of the strategies. 

    How did they do it? Some took a hard look at what they were buying each week and then focused on cutting out one or two such purchases each week.  

    Some signed up for a "shopping cart challenge" and agreed to review what's in the grocery cart before they check out. Then they'd remove a few items each trip, particularly if the goods turned out to be more of a "want" than an legitimate "need."

    Some eliminated spending money each month on services that they weren't using each month – such as streaming music, online video games and the like. Others aimed to shop "responsibly" online. The idea was to leave items in the online cart, wait a while and then avoid making whatever purchases that you can.

    Some found the best savings by reconsidering their online purchases by waiting a day or two. 

    Mindfulness is a buzzword for all sorts of things these days. Being aware of your present self and surroundings can help cut back on stress, improve sleep and, yes, maybe even control your spending. 

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