Make a Great First Impression

On February 16, 2014   /   Lake Martin Real Estate, Real Estate News  
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20 lake vista lane on lake martin alabama

INEXPENSIVE WAYS TO MAKE YOUR HOME SHINE

By Michele Dawson at Realtor.com
Once your home is listed and the for-sale sign is firmly implanted in your front lawn, all is ready for would-be buyers to tour your home. Or is it?
As anyone in the real estate industry will tell you, it’s important to make your home look its best when it comes time to show it. That first impression is everything. Even if you’re in a market where homes are selling quickly and for full asking price, it’s still key to spruce up your home and prove that it’s worth every penny you’re asking. And it doesn’t have to cost you a fortune.
In fact, a great first impression, coupled with the decreasing amount of time the typical home is on the market these days, is sometimes all it takes to see a speedy offer come your way.
So, if you’re in a market with few available homes for sale, you’re probably less likely to spend a lot of money on major aesthetic improvements. But there are a lot of simple, fairly inexpensive things you can do to make a good first impression and attract offers as quickly as possible.
Some things you can do to ensure your home’s exterior lands favorable first impressions include:
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Packing for a Move? Don’t Put These Items on the Truck

On February 10, 2014   /   Moving  
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packing for a move

By Erik Gunther: Realtor.com

Before you pack everything and open the door to your mover, keep in mind that some items may be hazardous — or even illegal — to put on the truck.

Generally, don’t pack anything that’s flammable, combustible or explosive.

Sounds easy, right?

Well, that simple rule of thumb covers many common items that you might not realize are a risk. Make separate arrangements if you need to move any of the following items that make movers balk:

  • Aerosols
  • Ammunition and guns
  • Charcoal
  • Cleansers containing bleach or ammonia
  • Fertilizer
  • Lighter fluid
  • Nail polish remover
  • Oil or gas of any sort
  • Paint cans
  • Pesticides and poisons

Another tip: Don’t try to sneak any of the above items into your moving boxes. You could be breaking the law, according to the U.S. Department of Transportation:

“Federal law forbids you to ship hazardous materials in your household goods boxes or luggage without informing your mover. A violation can result in five years’ imprisonment and penalties of $250,000 or more.”

Besides hazardous goods, movers won’t touch anything needing special attention, such as refrigerated or frozen food, plants or pets. You’ll have to find other ways to get those items to your destination.

There’s one other category of stuff you shouldn’t just hand over to your movers — high-value items. Your movers will take them, but think twice before packing them away. If you have jewelry, priceless collectibles, precious metals, or heirlooms that aren’t easily replaced, you should take them yourself.

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Mortgage Rates Continue Downward Trend

On February 2, 2014   /   Real Estate News  
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mortgage rates

By:

Mortgage rates for the most popular loans decreased this week as reports of a weakening economic recovery showed a decline in December new home sales. Adding to the drop in averages — for the fourth consecutive week — was another study that showed a decrease in November home prices.

The two new reports have furthered the belief among some experts that the economy and housing market may be too weak to handle a large upswing in home prices in the short-term. In the long-term, mortgage rates are still expected to rise considerably in 2014.

This week the average rate on a 30-year fixed loan dipped to 4.32 percent from 4.39 percent, according to the latest survey from mortgage buyer Freddie Mac. One month ago, that rate stood at an average of 4.51 percent. A year ago, the going rate for a 30-year fixed-rate loan was 3.53 percent — 0.79 percentage point below where it stands today.

The average rate on a 15-year fixed loan also saw its fourth consecutive decline, easing to 3.40 percent from last week’s 3.44 percent. A month ago it averaged 3.56 percent, and a year ago 2.81 percent.

Averages on hybrid adjustable-rate mortgages were mixed. After seeing a slight increase a week ago, the average for the five-year ARM fell to 3.12 percent from 3.15 percent. The one-year ARM registered a slight uptick, settling at 2.55 percent from last week’s 2.54 percent.

“Mortgage rates eased somewhat as new home sales fell 7 percent in December to a seasonally adjusted pace of 414,000 units, below the consensus,” said Freddie Mac Chief Economist Frank Nothaft in a statement. “The S&P/Case-Shiller 20-city composite house price index declined 0.1 percent for the month of November, the first decrease since November 2012.”

Mortgage rates had been rising steadily in December after the Federal Reserve announced it would begin to curb its bond-buying stimulus program in January. However, rates have eased over recent concerns that the market would not be able to support a dramatic upward shift in home prices.

The bond-purchase program has helped offset dramatic gains in real estate prices and kept affordability elevated while the market has stabilized. Despite the recent economic reporting, the housing market at large continues to show signs of recovery.

In the latest Mortgage Rate Trend Index by Bankrate.com, 42 percent of the analysts polled believe mortgage rates will continue to drop over the next week, while another 29 percent believe rates will hold steady.

“Weakness in emerging markets over the last week has really changed the markets’ view to a more ‘risk off’ perspective,” said Michael Becker, mortgage banker for Baltimore’s WCS Funding Group. “As a result, Treasuries are benefiting from a flight to safety. This is sending bond yields and mortgage rates lower, and I expect this to continue for a little while longer. This will give us lower rates in the coming week.”

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Self Employed? The Mortgage Rule you Need to Know

On January 26, 2014   /   Real Estate News  
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mortgage documents

By: Credit.com

When applying for a mortgage, lenders will classify you as a wage earner employee or self-employed. Furthermore, if you also own a business or a percentage of a business, you might be considered self-employed even though you are a W-2 wage earner. If this is you, here’s what you’ll need to know to complete a mortgage application.

To start with, here are the income classifications for lending:

  • Employee: Individual is a W-2 wage earner and receives a paycheck. Taxes are withheld from the paycheck.
  • Self-employed: This includes everything else — a sole proprietorship, any business entity where income is derived or lost (including all affiliated corporations), and income derived from real estate or dividend income.

Where the Two Worlds Intersect

Bona fide employees who also have an ownership interest in the company can actually be considered self-employed. For example, if you’re a W-2 wage earner employee and you also have more than a 25 percent ownership interest in the company that employs you, this would earmark you as ‘self-employed for the purposes of completing a mortgage application. If you happen to be a W-2 wage earner, but you have a percentage of ownership in another business, you would be considered both an employee and self-employed.

Business Ownership and Getting a Home Loan

Your federal income tax returns are required for the purposes of documenting your ability to repay when securing a new mortgage. On your tax returns, as a sole proprietor you file a Schedule C, and this income carries over to Schedule A. Most sole proprietors don’t have separate business entities, so corporate returns are not required as it is 100 percent ownership. However, things are different when you have an ownership interest in a company.

  1. Schedule E identifies whether there is additional business income and/or that you are an owner in an additional business.
  2. If an additional business is present on the return, the mortgage lender will require a K-1 to determine the percentage of ownership.

Mortgage Tip: If you own 24 percent of a business, you are not considered self-employed for the purposes of the loan application, and the lender will not need to obtain the corporate income tax returns. However, if you own 25 percent or more of a business — whether it’s your current employer or another business entity, as identified on the K-1 — then, yes, you’ll need to provide additional income tax returns for the entity in addition to your personal tax returns for obtaining the mortgage.

Why All Income Examination Matters

An ability-to-repay analysis is required on all mortgage loans. Simply providing W-2s, pay stubs and personal tax returns is not enough if you have more than a 25 percent business ownership interest in another company. If you’re receiving additional income from another business, and that income is tied to your personal tax returns necessary for securing that mortgage, it becomes necessary for the lender to have the additional tax returns because they support your reported income and subsequent ability to repay. Lenders are required to average your income in most cases during the past 24 months (including the business income) and that averaged income or loss will be used on the application in accordance with obtaining the new mortgage.

A financial word to the wise for the self-employed: You don’t need to provide the additional tax returns if you are a small minority share owner in a company.

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What Comes After You’ve Bought a Home

On January 5, 2014   /   Real Estate News  
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moving in your home

By: Realtor.com

You’ve done it. You’ve looked at properties, made an offer, obtained financing and gone to closing. The home is yours. Is there any more to the home buying process? Whether you’re a first-time buyer or a repeat buyer, you’ll want to take several more steps.

Those papers you received at settlement are extremely valuable, so hold on to them! In the short-term they can help establish tax deductions for the year in which the property was purchased. In the future such papers will be important for tax purposes when the property is sold, and in some cases, for calculating estate taxes.

Also at closing, determine the status of the utilities required by the home, items such as water, sewage, gas, electric and oil service. You want utility bills to be paid in full by owners as of closing, and you also want services transferred to your name for billing. Usually such transfers can be done without turning off utilities. REALTORS® can provide contact numbers and related information.

About two weeks after closing, contact your local property records office and confirm that your deed has been officially recorded. Such records are public notices that show your interest in the property.

Moving In

It is generally understood that sellers will leave homes “broom clean” when moving out. This expression does not mean “vacuumed” or “spotless.” Broom clean makes sense because it means the house is ready to be painted and cleaned.

Your Home, Your Money

For most owners a home is the largest single asset they hold, so it makes sense to protect that asset.

Many owners make a photo or video record of the home and their possessions for insurance purposes and then keep the records in a safety deposit box. Your insurance provider can recommend what to photograph and how to secure it.

You want to maintain fire, theft and liability insurance. As the value of your property increases such coverage should also rise. Again, speak with your insurance professional for details.

Lastly, enjoy your home. Owning real estate involves contracts, loans, and taxes, but ultimately what’s most important is that home ownership should be a wonderful experience. Enjoy!

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