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Start Your Projects

Tuesday, May 31, 2011

by Mike Parker

Summertime is almost here and millions of Americans will be starting home improvement projects. Whether they're classified as maintenance, updating or energy saving, they should make homeownership more enjoyable.

Remodeling magazine's 2010-11 Cost vs. Value Report suggests that some improvements are a better investment than others. Front door and garage door replacements are two of the easiest and return the greatest percentage of cost on resale.

Kitchen and bathroom updates transform an older home and instantly give visitors and buyers a fresh impression. Countertops and appliances can be expensive but yield great results. Painting the cabinets and replacing the hardware is much less expensive to change the look and feel of the rooms.

Energy efficiency enhancements can improve your enjoyment of the home and help save money on utility costs.

Replace older appliances - refrigerators, ceiling fans, water heaters, air-conditioners
Add insulation to keep your home cool in the summer and warm in the winter
Seal air leaks around doors and windows; holes in attics and crawl spaces with caulk, spray foam or weather stripping - more information
Seal all heating and cooling system ducts - more information

Looking through the eyes of a buyer could show you what features most date your home and could order the priority that you tackle the projects.

Not So Fast Buyers!

Wednesday, May 18, 2011

by Mike Parker

One of the challenges buyers are having with financing may be their own understanding or lack thereof.

In a recent survey done by research firm Ipsos for Zillow, a surprising number of incorrect answers to true or false questions were given by prospective buyers.

Over 3/4 didn't realize how the mortgage rate was determined for a borrower thinking that annual income was the most important factor. Other considerations lenders do evaluate are credit score, debt-to-income and loan-to-value ratios.

A variety of myths seem to have influenced some of the common answers such as interest rates are set and released once a day; FHA loans are for first-time buyers only; prequalification commits the lender; lender fees are not negotiable and adjustable rate mortgages always go up.

Buyers' misunderstanding of actual mortgage practices may give some insight into why more of them are not taking advantage of the greatly reduced prices and incredibly low mortgage rates.

While getting solid information about mortgages and being pre-approved from a lender are very important, it is only one step in the home buying process. Success in buying a home in today's unique market should begin with a real estate professional that will coordinate all of the different parts of the transaction including mortgage, title, insurance and inspections.

mortgage financing

Cash-In Refinance

Wednesday, May 11, 2011

by Mike Parker

Here's an interesting thought. Instead of pulling money out of your equity when refinancing your home, consider putting some cash into your equity. The strategy would be to get a considerably lower rate and a shorter term than 30 years. It will pay off your mortgage sooner, build equity faster and save lots of money in interest.

If you have some extra cash available, this might be very atteractive compared to what your are earning currently on those savings.

In the example below, the current mortgage is at 5% for 30 years with payments of $939.44. The owner can refinance for 15 years at 3.875%. If he puts $30,000 into the refinance, his payments will be slightly more than the current $1,011.06 but the mortgage will be paid off in 15 years. At that same point, if he keeps the current mortgage, his unpaid balance will be $101,572.88.

In order to have the same payments as the mortgage he is refinancing, he'll need to add $39,764.68 to the refinance.

If you have a goal to get your home paid off and you have some funds available, a Cash-In Refinance may be just the strategy for you.