Before You Choose a Mortgage Lender, Read These Tips

Someone out there wants to help save you time, stress, and money. Here’s how you find them.

Everyone in the market for a house has different wants — prewar charm, a lush backyard, a welcoming front door in Pantone Ultra Violet. But at the end of the day, they all share a common need: money. Lots of it.

Enter your mortgage lender.

The right lender can save you time, anxiety, and loads of cash. And the right loan officer — the professional who represents the lender — can be a powerful ally when you close on a mortgage. As with any potentially life-altering partnership, it’s important to choose wisely.

Only You Know Which Lender Is Your Type

You can choose from three types of mortgage lenders — retail banks, credit unions, and mortgage banks — as well as mortgage brokers, who compare loan products via a coterie of potential lenders to help you, the client, find the right one. Before you start narrowing down the candidates, know what you’re looking for and where to find it. Let’s talk about your options. 

Retail Banks

What they are: These are your Chases and Banks of America, plus your local banks. They do their own underwriting (in a nutshell, investigating your finances). So, retail banks, especially the smaller ones, can sometimes offer lower fees and less-stringent credit requirements. If you like to have your accounts all in one place, you may want to use your own bank or credit union. 

Who you’ll work with: You’ll be assigned a loan officer, who will receive a commission or bonus for writing your loan.

Credit Unions

What they are: They’re not-for-profit and customer-owned, so they’re not beholden to shareholders, like banks are. Because of that and their not-for-profit tax status, they typically offer more personal service and lower fees. The flip side is they’re less convenient: They have fewer branches and ATMs. 

To apply for a loan, you must be a member of the credit union’s community, which could be faith-, employment-, interest-, or union-based. That said, borrowers can typically become a member easily. The National Credit Union Administration’s Credit Union Locator is a tool to find credit unions near you. 

Who you’ll work with: As with a bank, you’ll be assigned a loan officer, who will receive a commission or bonus for writing your loan.

Mortgage Banks

What they are: These banks, such as AimLoan and PennyMac, offer only home loans. Many online lenders, like Rocket Mortgage, operate as mortgage banks.

Who you’ll work with: A mortgage bank will assign you a loan officer, who will receive a commission or bonus from the lender’s gross fees for writing your loan. An online lender will offer less hand-holding.

Mortgage Brokers

What they are: Mortgage brokers are essentially personal home loan shoppers. They act as liaisons between home buyers and mortgage lenders to help people find the lowest rates and the best mortgage terms. They can get home buyers the best mortgage rates because they leverage their existing relationships with lenders — something individual home buyers can’t do. The idea is that by doing the heavy lifting for the borrower, they make loan shopping more convenient — and perhaps a bit faster. 

Who you’ll work with: A mortgage broker can be an individual agent or a group of agents who act as independent contractors. In exchange for their services, mortgage brokers typically charge a 0.50% to 2.75% fee of the loan principal, which is paid by either the borrower or the lender at closing. The charge can vary greatly.

Now that you’re armed with the basics, you’ll want to give yourself time to weigh the options about which lender, exactly, to work with.

It Pays to Shop Around Before You Commit

Over the life of the loan, seemingly subtle differences could add up to tens of thousands of dollars. That money belongs to future you and all your dream vacations, renovations, and remodeling #goals.

So before you choose your specific lender, do these things:

  • Thoroughly research any retail bank, credit union, mortgage bank, mortgage broker, or online option you’re considering. Make sure you’re clear on what they can offer you. If you’re doing your homework, you’re less likely to be dissatisfied with the results.
  • Interview lenders. You’re aiming for a shortlist of three. (You’ll see why it’s three in a minute.) If you’re thinking about selecting an online lender, make sure you take into account this guidance.
  • Don’t be shy about seeking advice. Survey your family, friends, and coworkers —  especially the ones who are nerdy about money.
  • Ask your real estate agent for a second opinion. They have experience with reputable lenders, particularly in your city or town.

Now, let’s say you’ve narrowed your list of potential lenders to at least three candidates. The next step? Find out whether they will give you a loan.

You Should Seek Out a Lender’s (Pre-)Approval, To

There’s a world of difference between being prequalified for a loan and being pre-approved. Pre-approval means you’ve got skin in the game. It means you’re a boss. And it’s proof that you can buy.

Besides being the grown-up thing to do, pre-approval positions you better to make an offer. Everyone takes you more seriously. Pre-approval provides evidence to your real estate agent and the seller (or seller’s agent) that a trusted financial institution is willing to finance the purchase.

In most housing markets, sellers will expect you to be pre-approved when you make your offer. And when you’re pre-approved, you’re more likely to have your offer accepted — or at least, you won’t lose out on a bid because you have to go back to the bank to get approved for a loan.

As for prequalification, it’s an approximation and not necessary unless you have no clue about your creditworthiness and just want a snapshot.

By contrast, with a pre-approval, a lender typically goes deeper and tells you more specifically how big a loan you can get. Caution: Just because the lender says you can take out a loan for an amount, doesn’t mean you should. Consider your lifestyle and monthly budget to decide on the responsible loan amount for you. 

To get pre-approved, you must also authorize a lender to pull your credit. Here are credit scores and how they can affect interest rates and loan options for borrowers:

  • 760 or higher — Can typically qualify for the lowest interest rates.
  • Below 650 — May need to apply for a nonconventional mortgage, such as a Federal Housing Administration loan — a government-backed loan that requires a minimum credit score of 580 but lets borrowers make a down payment as low as 3.5%.
  • Below 580 — Can still qualify for FHA loans, but borrowers will have to make at least a 10% down payment. The lower the score, the tighter the requirements.

When you’re pre-approved, you’ll get a Loan Estimate, which is a three-page document that will become your new best friend.

Find at Least 3 Lenders to Pre-Approve You

A Loan Estimate spells out a future loan’s terms, including:

  • The interest rate
  • The length of the loan
  • Estimated costs of taxes and insurance
  • How interest rates and payments might change over time
  • Other important financials

By comparing loan estimates, you can effectively size up your loan options and decide which lender is best for you — and your future. (If you need help navigating the details, the Consumer Financial Protection Bureau offers a sample Loan Estimate with helpful tips and definitions.) 

Getting pre-approval early in the process also gives you an edge over other buyers. Here’s why: 

  • Once you know how much you’re approved for, you can more easily determine your price range and save time and frustration when shopping.
  • It sends a signal to your agent and sellers that you’re serious about buying a home.
  • It’ll help you move quickly to make an offer when you see a home you like.
  • And it’s an excuse to celebrate! You now have everything you need to move ahead with that one special lender. At the same time, you can connect with an officer or broker who can help you select the home loan product that’s best for you. 

So have a cocktail. Do a dance. You’re a (huge) step closer to getting a new house.

“Visit HouseLogic.com for more articles like this. Reprinted from HouseLogic.com with permission of the NATIONAL ASSOCIATION OF REALTORS®

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5 Outdoor Features Homeowners Want This Spring

From backyard pickleball courts to wildscaping, find out how homeowners are sprucing up their yard.

As spring approaches, more homeowners are sizing up their outdoor space and making plans to ensure every square inch counts. They’re ditching expansive, lush lawns and carving out more areas for entertaining, relaxing and pursuing hobbies. The Plan Collection, a home design site, shares spring outdoor design trends that are gaining popularity this year.

1. Outdoor Kitchens 

Outdoor kitchen with brick
Photo credit: The Plan Collection

Outdoor kitchens are getting upgraded with cabinets, islands, outdoor electric ovens and granite or highly polished concrete countertops. Online search terms, compared to last year, reveal the following upticks related to consumers’ interest in outdoor kitchen design:

  • Outdoor counters: +86%
  • Outdoor oven: +83%
  • Outdoor sink: +50%
  • Outdoor electric grill: +50%

A growing preference for electric outdoor appliances—in lieu of traditional gas grills—is due to gas’ perceived environmental impact, The Plan Collection notes.

2. Weather-Resistant Landscaping

Weather-resistant lawn
Photo credit: The Plan Collection

Weather extremes, like droughts and extreme heat, are challenging the practicality of large, green lawns. Homeowners are now turning to alternative landscaping approaches, including:

  • Native landscaping: The use of native plants to preserve the local, natural ecosystem. These require less maintenance, less water and little or no fertilizers.
  • Wildscaping: This includes native landscaping and creates a habitat for local bees, birds and small animals.
  • Xeriscaping: Landscaping designed to reduce or eliminate the need for water, such as using rocks. In the West, droughts and government-mandated water limitations are rising and prompting more homeowners to explore xeriscaping.
  • Solar: In harnessing the sun, solar lighting and bird baths are a rising trend. Bird baths are being outfitted with a solar panel to provide energy to run a fountain pump and circulate water.

3. Backyard Pickleball Courts

While the emergence of pickleball has infused life in vacant commercial properties, homeowners are beginning to install their own courts, too. Backyard pickleball courts are still considered a luxury; for those on a budget, the driveway has become the optimal location for playing pickleball at home.

Pickleball court
Photo credit: Ucpage / Getty Images

4. New Levels of Outdoor Spaces

Raised pergola
Photo credit: The Plan Collection

Rather than building out, homeowners are building up to maximize square footage, especially for homes with small lots. Raised outdoor spaces can offer a view and increase a home’s entertainment space.

Outdoor space
Photo credit: The Plan Collection
Outdoor space
Photo credit: The Plan Collection
Outdoor space
Photo credit: The Plan Collection

5. Adaptable, Flexible Yards

Rear porch with outdoor kitchen
Photo credit: The Plan Collection

Over the past year, The Plan Collection says, floor plans for new homes have been showcasing more spaces that can be adapted for multiple functions, including:

  • Outdoor kitchens that can double as an entertaining space.
  • Lightweight sectional furniture that can be moved to accommodate a cocktail party or a child’s birthday party.
  • Just enough lawn—or turf—for visual appeal but also for enjoying outdoor games.
  • Screened-in porches or pergolas that provide shade, protection from insects and an extended outdoor living season.

“Copyright NATIONAL ASSOCIATION OF REALTORS®. Reprinted with permission”

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What is HOA? What You Need to Know About Rules and Regulations

Amazon Is Selling High-Tech Homes and Apartments in Smart Communities
JASKARAN KOONER//GETTY IMAGES

If you live in a newer suburban community or planned unit development, you’re probably a member of a homeowners association. More than 74.1 million Americans live in homeowners associations, condominium communities, cooperatives, and other planned communities, according to Community Associations Institute. It’s also a good bet that you hadn’t given your HOA much thought until you had a problem.

Since HOAs make and enforce the community rules, it’s smart to understand what you can do if you can’t or don’t want to follow them.

How an HOA Works

Each HOA, a volunteer group of neighbors who manage common areas and community property, creates its own covenants, conditions, and restrictions (CC&Rs). These CC&Rs cover subjects such as:

  • Resident behavior (no glass containers around the pool)
  • Architecture (no fences higher than eight feet)
  • Common responsibilities (fee schedules and fines for non-compliance)

The mean monthly dues for a homeowners association is $191, according to the U.S. Census Bureau American Housing Survey 2021. And there’s value in the fee.

Disputes With the Board Can Escalate

Some boards can impose what some homeowners believe are invasive, silly, or even inconsistent rules. Yahoo! News reported a situation in which a homeowner submitted a plan for four window when the other homeowners had eight windows. The board rejected the first plan she submitted, but approved the second one, which was for four windows.

After the homeowner installed the four windows, a dispute started between the homeowner and the board about who would pay to switch the number of windows back to eight. The homeowners ended up being fined thousands of dollars, and the board put a lien on her house, and threatened to foreclose. The homeowner then sued the board and won. But the board plans to appeal.

Steps to Take When You Don’t Like the Rules

Even if you disagree with the rules, keep paying your dues. HOAs have broad legal powers to collect fines and fees and regulate activities. If you don’t respond to letters from the board, property manager, or a collection agency, the HOA can and will turn to small claims court or file a lien against your property.  

You can handle some issues with a phone call. For example, adding recycling to the garbage collection route is a budget, not a rules, issue. Call the board member who oversees trash collection to find out if there’s leeway in the budget. If you want to do something that’s against the rules — like flying the American flag in your yard — start by:

  • Making a written request for variance, using the appropriate HOA form in your CC&R documents. A variance gives you permission to be the exception to the rule. Submit your request to the board and property management company. 
  • Seeking a compromise: For example, you could request permission to fly the American flag only on national holidays.

Don’t Expect a Quick Solution

Some HOA boards meet as infrequently as twice a year. If the board decides the issue is worth pursuing, it may require a community vote. If it passes a majority, the board will adopt it. Board members also may consult the HOA attorney to see if there’s a legal liability if they rule against you.

If you don’t get a timely response, request a hearing and resubmit your request for variance with as much support for your cause as possible. 

If the board rules against you without a community vote, you can appeal the ruling with a petition signed by a majority of other homeowners.

Fine Reality

If you fly your flag without permission, however, expect to be fined. Fines can range depending on the issue. Your CC&Rs will indicate the fine schedule — per day, per incident, etc. Interest for nonpayment can accrue, and the HOA can sue you in small claims court. 

If you think the ruling or the fines are unjust, the last resort is to hire an attorney and sue the HOA.

Become the Rule-Maker

If you don’t like the rules, the best way to change them is to become part of the process.  

Know your CC&Rs, annual budget, and employee contracts  Do you see areas where expenses can be cut? Are service providers doing their jobs? 

Volunteer for a committee or task  If the board needs to enforce parking rules, for instance, you can volunteer to gather license plate numbers of residents’ vehicles. In addition, put your professional expertise to work: Assist the board with data entry, accounting, or website design. 

Stand for election to the board — When a position becomes open, the board notifies the members, and you can put your name forward. New board members are elected at the annual meeting by member majority vote. Many boards are three to nine members large, with terms of one to two years.

Involvement Drawbacks

As a board member, be prepared to spend two to four hours a month:

  • Reviewing property management reports
  • Monitoring budgets
  • Talking to other board members and residents

Most boards meet quarterly; small boards meet only twice a year for a couple of hours.  

Accept that you might become less popular if homeowners don’t like your decisions. In the worst case, you could be sued, along with the rest of the association.

Involvement Benefits

There are rewards. You’ll feel more in control of your community’s fate. You may find that some rules you didn’t support have merit after all. But most of all, you’ll know you’re doing all you can to protect your quality of life and your home’s value.

“Visi houselogic.com for more articles like this. Reprinted from HouseLogic.com with permission of the National Association of Realtors®.”

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Staying calm after the NAR settlement…

“The Truth About the NAR Settlement Agreement. There’s much the media has gotten wrong about NAR’s settlement, which would require the association to pay $418 million over four years. Some outlets have suggested that NAR previously set or guided commissions to a standard rate of 6%. Even President Joe Biden, in recent comments, misspoke in suggesting that the settlement makes commissions negotiable for the first time.”

“You know that is false. NAR does not set commissions, and commissions were negotiable long before this settlement. They are and will remain entirely negotiable between brokers and their clients. And housing prices are dictated by market forces beyond members’ control.”

copyright NATIONAL ASSOCIATION OF REALTORS®. Reprinted with permission.

This lawsuit has been going on for a long time and Washington State was ahead of the settlement by implementing new forms as of January 1st, 2024. These forms help protect clients and make things more transparent. More specifically, who is paying the agent fees and how much are you paying? Well… our compensation has always been negotiable as well as who pays us. Realtor fees are not being slashed; they are being accounted for. Transparency and Accountability.

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How Much It Costs to Keep Up with the Joneses

They’re making a pricey remodeling mistake. You don’t have to.

Mansion staircase
Image: Library of Congress, Carol M. Highsmith, photographer/LC-DIG-highsm-05567
  • KEY TAKEAWAYS

Jealous of your neighbors’ new master bath? Who wouldn’t be? It’s got heated floors, a sauna, and a massive whirlpool tub. To be honest, your own bathroom looks like the shower station at the public pool in comparison. And you have been thinking about renovating it. Maybe a sauna isn’t such a bad idea after all. And how about one of those new tube lights? Yeah, that’d be cool.

Actually, doing the opposite — resisting the urge to keep up with the Joneses makes you the smarter neighbor. Just ask Michael Kelczewski, a REALTOR® in New Hope, Pa. His client added a spa with a downtown view to his Philadelphia home, which was way out of sync with his urban neighborhood. That made the home difficult to sell.

“He liked to sit in the tub with his Belgian ale and look over the city while it was snowing,” Kelczewski says. “But the feature decreased the home’s value significantly. The property sold after a year — with a significant price reduction.”

Renovating your home into the nicest digs in the neighborhood comes with big risks. Best to think twice before replicating the Joneses’ extravagant additions, lest you end up with an over-renovated house that’s undervalued by the market.

Here are the questions to ask yourself before one-upping the neighbors:

Is This Your Forever Home?

It’s hard to believe, but the average American moves 11.4 times. And according to the data-crunchers at FiveThirtyEight, most 25-year-olds still have more than six moves (!) remaining. So, statistically speaking, you’re going to move.

And when you do, you’ll need to sell your house. That means you should think about how any project will affect your home’s value. It’s not as simple as you think. Just because you improve, doesn’t mean you recoup (more details coming up — just watch for the tables).

Some people just want to buy a house and turn it into a giant English estate. That’s your prerogative.

Michael Kelczewski, REALTOR®

On the other hand, you may truly plan to stay put. Newer studies find that today’s first-time buyers want to stay in their first homes longer than previous generations. So if you’re one of the ones bucking tradition, then by all means, do what you want to do without regard to resale value.

“Some people just want to buy a house, and live in it and turn it into a giant, English estate,” says Kelczewski. “That’s fine. That’s your prerogative.” (Although you might want to look into any homeowner association rules.)

But if you’re planning a move anytime between now and eternity, let the Joneses keep a good lead on you in the renovation race. You’ll come out better financially. Guaranteed.Popular Reads

How Does Your Home Rate?

“You don’t want to be the best house in the neighborhood,” says Cristine Lefkowitz Jensen, a REALTOR®based in Henderson, Nev., and a former interior designer. Otherwise, literally every other house around you looks like a better deal. It’s only smart to keep up with the Joneses if everyone on your block does. Keep an eye on comparable properties nearby, and use those prices to know how much is too much to invest in upgrades.

“Don’t put in Carrara marble and $80,000 cabinets in a market that won’t bear that selling price,” says Kelczewski. It’s just not smart.

If the average home in your area sells for $500,000, and you purchase a fixer-upper for $400,000, don’t invest more than $100,000; otherwise, you’re wasting cash.

Are You Tempted to Finance Your Project?

As a general rule, taking out a loan for a renovation is a bad idea. Any large-scale upgrades that require begging the bank for cash should get an automatic “no” (sorry!). Even if you know for a fact that the Joneses financed their dream bathroom, that’s all the more reason to march to your own home ownership drum.

Think about it: Even if the Joneses are increasing their home’s value a bit, they’re also paying interest, which eats into the benefit.

That said, don’t feel guilty about financing smaller, low-risk projects that are sure to increase your equity. For example, upgraded insulation may not be sexy, but according to the National Association of REALTORS® “Remodeling Impact Report,” its median cost is just $2,500, and it recovers 100% of its value in a sale. So a small loan (that you can pay off quickly) might make sense, especially when you consider the energy savings.

Good bets include:

ProjectMedian Cost Recoup in $$
New Roofing$12,000$12,000
Hardwood Flooring Refinish $3,400$5,000
Insulation Upgrade$2,500$2,500
New Wood Flooring$5,500$6,500
New Garage Door$2,000$2,000
New Vinyl Siding$18,300$15,000

Have You Done Your Research?

Some projects — like refinishing your hardwood — are no-brainers because they’re relatively small and recoup most of their value in a sale.

Should You Refinish Hardwood Floors Yourself? ]

Other, bigger investments, like updated kitchens, are a big draw for future buyers.

Dated kitchens are “the No. 1 killer of all deals,” Lefkowitz Jensen says. According to the NAR report, a typical kitchen remodel costs $80,000 and recovers $60,000 in equity. And, no, that $20,000 difference isn’t wasted. You’ll love the upgrades while you live there, and get most of your money back when you move. (And enjoy a shorter selling time, too.)

Here are some popular projects and their typical costs. But a REALTOR® will know what’s ultimately best in your neighborhood.

Project Median Cost Recoup in $$ 
New Vinyl Windows $30,000$20,000
New Fiber Cement Siding $18,600$16,000
New Steel Front Door$3,150$2,000
Basement Conversion to Living Area $57,500$49,250
Kitchen Upgrade$35,000$20,000
Complete Kitchen Renovation$80,000$60,000
Attic Conversion to Living Area$75,000$40,000
New Fiberglass Front Door$2,700$1,800
Bathroom Renovation$30,000$15,000
New Wood Windows$35,000$20,000
Closet Renovation$3,570$2,000
New Master Suite $125,000$65,000
Add New Bathroom$59,000$27,750

Another equity-rich option is creating an open floor plan. “Not everyone eats dinner like Norman Rockwell, but that’s how the properties were designed at that time,” Kelczewski says. “Increase the home’s value by knocking down those walls and adding square footage.”

Will Your Project Add Curb Appeal?

Improved curb appeal can increase the price of your home up to 17%, according to a Texas Tech University study, so don’t shrink away from jazzing up your patio and lawn. So if the answer to the curb appeal question is yes, go with the Joneses.

“Curb appeal is 50% of the sale,” says Lefkowitz Jensen. “You only have one chance to make a first impression.”

Get a sleek and modern exterior by replacing your crumbling wooden front door with a gorgeous steel model, which looks stunning and recoups 63% of its cost in a sale, according to the NAR report.

Adding trees and bushes brings dimension to your lawn. Even just maintaining your yard makes a big difference. Additional lighting along the walkway is a worthwhile investment, too — in addition to making your home safer.

Will Your Remodel Bring You Joy?

It’s your retreat, your place. It should bring you joy when you walk in the door. You can’t put a dollar figure on that.

However, the NAR report does give some insight into what projects homeowners are happiest with, regardless of cost. REALTORS® asked some of their clients which renovations brought them the most satisfaction.

Here’s how some popular projects ranked, according to the NAR report’s “joy score” (with 10 being the highest score). Note that joy and recoup don’t always pair up like you’d think they would.

Project Joy Score Recoup in % 
Hardwood Flooring Refinish10147%
New Wood Flooring10118%
Insulation Upgrade10100%
Closet Renovation1083%
Attic Conversion to Living Area1075%
Complete Kitchen Renovation9.875%
Kitchen Upgrade9.867%
Basement Conversion to Living Area9.786%
 Bathroom Renovation9.671%
New Windows Vinyl and Wood9.6Vinyl–67%, Wood–63%
Add New Primary Bedroom Suite9.556%
New Front Door (Steel and Fiberglass)9.5Steel–63%, Fiberglass–60%

“You only have a short time on this earth,” Kelczewski says. “If you want to paint your house purple and put in a hot tub, that’s your choice. It’s your property. Enjoy.” 

“Visit HouseLogic.com for more articles like this.  Reprinted from HouseLogic.com with permission of the NATIONAL ASSOCIATION OF REALTORS®.”

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How Smart Home Technology Can Be a Selling Point

Home technology smarts are the new area for real estate bragging rights.

smart home tech selling points control system with icons and dining room
Image: onurdongel/Getty
  • You often judge a house by it’s good looks. But guess what? Now you can also judge it by its IQ. Long-buzzed about smart home technology — think smart thermostats, smart lighting, and app-controlled security systems — are moving into more homes. Smart home tech can up your coolness factor and make homes easier to operate. Plus, it may also offer perks when you sell your home one day.

Home shoppers are increasingly looking beyond that killer kitchen upgrade to a seller’s Wi-Fi signal and connectivity. This isn’t just a priority for the techie set. As smart home technology gets more affordable and easier to use, more people are adding devices. Half of U.S. consumers owned at least one smart home device in 2021, up from 35% in 2020, according to NPD Connected Intelligence. The number is expected to grow as homeowners look to save money, feel safer at home, and add convenience.

A Home’s Technology Smarts Matter

Here comes a potential home buyer. Motion-activated lighting automatically turns on as they enter. A smart thermostat adjusts the temperature for ultimate comfort. The smart robot vacuum is keeping the home tidy. The window blinds are adjusting based on the sun’s direction. And the smart speaker is telling them about the home’s features.

Seriously, wouldn’t you be a little impressed?

Four in 10 Americans have bought a smart home device since the COVID-19 outbreak and are more interested in smart home technology, according to a 2020 REALTOR.com study. “The pandemic has driven smart home technology forward,” says Angel Piontek, an associate broker with Coldwell Banker Elite in Fredericksburg, Va. “How we interact with our homes is becoming different. At some point, buyers will expect it.” 

The majority of real estate professionals surveyed by Z-Wave Alliance believe smart home technology can help in marketing a home, according to the organization’s 2020 report on smart technology. In fact, some real estate professionals are already using smart home features as selling points. You may spot more icons on online 3D tours of real estate listings that flag smart technology inside a home. Or, during in-person real estate showings, laminated placards may point to devices and highlight what they do. 

Smart Home Technology Costs and Buyer Preferences

Consumers between 18 and 34 said they would pay more for homes with home theaters, smart speakers in every room, and connected kitchens, according to the REALTOR.com study. In the 25 to 54 age group, consumers said they’d pay more for solar roof tiles and home battery packs. And for those 55 and older, solar roof tiles, smart doorbells, and security systems would be worth extra money.

It’s tougher to validate that smart technology can generate more money in a home sale. Anecdotally, real estate professionals believe it can: “If a home is marketed correctly and has smart home technology, it can sell for top dollar,” says Kristin Triolo, a broker associate with RE/MAX Platinum Realty in Sarasota, Fla.

Fully automating an entire home with higher-end systems could cost upward of $15,000. But an appraiser would factor in such a system at resale, according to Christopher Matos Rogers, an associate broker with the Matos Rogers Group’s Palmerhouse Properties in Atlanta.  

Boosting Marketability with Smart Technology

If you don’t already have smart home technology, some real estate professionals may recommend adding it before you list your home. Tech-savvy generations may expect it. And older adults may be drawn to such systems — particularly voice-controlled ones that support aging in place.

You can easily add smart home technology to modernize an older home and help it compete with newer ones. After all, many homebuilders offer smart home packages to outfit new homes with smart thermostats, app-controlled garage doors, smart lighting, door locks, and video security systems.

Smart home technology investments can range from $20 for adding smart lightbulbs to $20,000 or more for automated solutions that connect systems in one hub for an entire house. For $1,500, you can outfit your home with multiple systems like a smart speaker, smart lighting, and a smart thermostat to increase the home’s smart tech appeal. For about $5,500, homeowners could automate the lights, door locks, and thermostat, and install a smart speaker, hub, and smart plugs in three rooms, according to FixR.com.

Regardless of how extensive your devices are, real estate professionals will typically want to spotlight them. “Buyers may not have a lot of knowledge of smart home technology, but they do know and understand energy savings and cost savings,” Triolo says. For example, a Nest consumer survey estimates that the company’s smart thermostat could reduce a home’s heating costs by 10% and cooling costs by 15%. 

What Else Adds Smart Tech Appeal

Bigger brand names in smart home technology — like Nest, Ring, and Lutron — have instant name recognition when selling, says Piotnek.

Ease of use also counts. For example, having to open several apps on a phone to control various aspects of a home can feel cumbersome, says Ellis Gardner, a broker with Keller Williams Realty in Chattanooga, Tenn. But being able to say, “Hey, Google, turn on my lights!” shows convenience.

With smart devices, you’ll need to be clear about what stays and what goes with the home sale. “It’s a gray area with some of these devices on what’s considered personal property,” Piontek says. For example, digital assistants like Alexa or Google Home may be used as your smart home hub. But sellers may consider these personal property to take when they move. “So, it’s really important to get this all in writing so there’s no question at the end of a transaction.”

3 Ways to Avoid Misunderstandings About Smart Home Tech

Avoid misunderstandings about smart home technology with these three tips:

  1. Find an agent with smart technology expertise. They can help avoid hiccups in selling a smart home and also tend to be savvy marketers of smart tech. Some real estate professionals — like Triolo and Gardner – have smart home certification and extra training through the Residential Real Estate Council, a provider of real estate education and networking. 
  2. Identify which of your smart home technology devices or apps are real property versus personal property. In general, items affixed or hardwired to a house stay — likely your smart thermostat or any switches and mounts. If you plan to take your Nest thermostat or Ring doorbell, replace it before listing. The buyer could figure that anything in the house at a showing will remain with the house. 
  3. Turn over the virtual keys. On closing day, “turning over the passwords in a smart home is like turning over the key to the front door,” says Gardner. For all transferable technology, reset it to factory settings to erase any personal data. Leave instruction manuals or website links for the new owners to open up new accounts. 

Smart home technology is improving safety, security, and convenience in homes. Homeowners should also consider the benefits they’ll have when they sell one day, Piontek says. Just like curb appeal, high home appeal may make your home a standout to buyers.

“Visit HouseLogic.com for more articles like this.  Reprinted from HouseLogic.com with permission of the NATIONAL ASSOCIATION OF REALTORS®.”

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Home Insurance and Mold: Is Mold Covered?

Whether you’re covered often comes down to the source of moisture and the wording of a policy.

  • Mold strikes fear into the hearts of those who’ve heard horror stories about toxic mold, expensive mold remediation, and denied home owners insurance claims. Yet mold can be found anywhere, including in most homes. It’s usually harmless.

Mold needs moisture to thrive. Problems can arise for home owners when the presence of persistent moisture goes undetected or unresolved, leading to widespread mold growth. Moisture can result from high indoor humidity, flooding, or a leaky roof or dishwasher.

Whether mold damage is covered by home owners insurance often comes down to the source of that moisture. Take an hour or two to review the language of your policy, especially as it pertains to water damage. Look for mold exclusions or limitations. Call your agent if the wording is unclear.

Mold and Home Owners Insurance

Most basic home owners insurance policies exclude coverage of damage caused by mold, fungi, and bacteria, says Mark Ferguson, property claim specialist with General Casualty Insurance in Sun Prairie, Wis. Yet that doesn’t mean a mold claim will be denied automatically.

In most cases, if mold results from a sudden and accidental covered peril, such as a pipe bursting, the cost of remediation should be covered, says Ferguson. That’s because technically the pipe burst is the reason for the claim, not the mold itself. Claims are more likely to be rejected if mold is caused by neglected home maintenance: long-term exposure to humidity, or repeated water leaks and seepage.

It’s hard to put a precise dollar figure on mold damage because most insurers don’t separate mold claims from water-damage claims, says Claire Wilkinson of the Insurance Information Institute. About 22% of all home owners insurance claims result from “water damage and freezing,” a category that includes mold remediation, according to the III. A 2003 white paper on mold from the III put the cost of the average mold claim between $15,000 and $30,000, at least five times the average non-mold home owners claim at that time.

After a rush of mold claims in the early 2000s, most states adopted limitations on mold coverage. Amounts vary, but a typical home owners policy might cover between $1,000 and $10,000 in mold remediation and repair, says Celia Santana of Personal Risk Management Solutions in New York. Most policies won’t cover mold related to flood damage. For that, home owners need separate flood insurance, which averages $540 per year through the National Flood Insurance Program.Popular Reads

Damage Done by an Inch of Floodwater

Replace carpet, flooring$2,700
New baseboard molding$2,250
Replace drywall$1,350
Cleanup, materials$1,000
Bookshelves, lamps$500
Total$7,800

Source: National Flood Insurance Program

Is Extra Mold Coverage Necessary?

It might be possible to purchase a mold rider as an add-on to your existing home owners policy. Ask your agent. A rider will offer additional mold coverage. Cost and your personal risk-tolerance are the driving factors behind a decision.

Premiums will vary based on where you live and the value of your house. You could pay from $500 to $1,500 a year for a rider on an existing policy. Prices tend to climb in humid southern climates, and in Texas and California, where there have been high-profile mold cases.

In general, older homes in humid climates where mold thrives will be more costly to insure than newer constructions in a dry climate. In particular, homes built within the past five years are likely constructed with mold-resistant wood, drywall, and paints, says Santana. Newer homes are also less susceptible to water infiltration.

If your insurance carrier isn’t willing to provide a rider because the risk is too great, specialty companies such as Unitrin might sell you a standalone mold policy. Brace yourself for a hefty price tag. Annual premiums for a standalone mold policy might range from $5,000 to $25,000. Weigh the cost against risk factors including the age and value of your home, its construction, and the prevalence of mold issues in your area.

Moisture Prevention Is the Key

The surest way to avoid having a claim denied is keeping mold at bay in the first place. Preventing mold and eliminating mold when it does occur are critical to protecting the value of your home.

To help prevent mold growth in your home, the III suggests taking the following steps:

  • Lower indoor humidity with air conditioners, dehumidifiers, and exhaust fans.
  • Inspect hoses and fittings on appliances, sinks, and toilets.
  • Use household cleaners with mold-killing ingredients like bleach.
  • Opt for paints and primers that contain mold inhibitors.
  • Clean gutters to avoid overflow and check roof for leaks.
  • Avoid carpet in wet areas like basements and bathrooms.
  • Remove and dry carpet, padding, and upholstery within 48 hours of flooding.
  • “Visit HouseLogic.com for more articles like this.  Reprinted from HouseLogic.com with permission of the NATIONAL ASSOCIATION OF REALTORS®.”
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Sharp Homeowners Know June Is the Best Time to Do These 5 Things

Like cleaning your siding — just be sure to start from the bottom and go up.

cell phone reminder of home maintenance tasks to complete now in june with a background of pink and yellow tulips
Image: Maggie Stuart for HouseLogic
  • Could it really be summer?!

Tackle these five summer maintenance tasks during June’s longer days and better weather — and save yourself time and money this winter.

#1 Update Outdoor Lighting

Outdoor stone steps lit with pathway lighting
Image: Rosann M. Kelley, photo/ Outdoor Artisan, Inc., design
  • In June, winter nights are probably the last thing on your mind. But early summer is the perfect time to plan for those “OMG, it’s only 4:30, and it’s already dark ” moments by adding or updating landscape lighting.

The most energy-efficient, easy-to-install option is solar lighting, but it won’t perform as well on dark or snowy days. For light no matter the weather, install electric.

#2 Clean Your House’s Siding

Home with bright green painted siding
Image: Kristin Diehl
  • With a bit of preventive maintenance, your home’s siding will stay clean and trouble-free for up to 50 years. Fifty years! Clean it this month with a soft cloth or a long-handled, soft-bristle brush to guarantee that longevity.

Start at the bottom of the house and work up, rinsing completely before it dries. That’s how you avoid streaks.

Related: How to Clean the Siding on Your House

#3 Focus on Your Foundation

Brick exterior wall with damage
Image: Martb/Getty
  • There’s no better time for inspecting your foundation than warm, dry June. Eyeball it for crumbling mortar, cracks in the stucco, or persistently damp spots (especially under faucets). Then call a pro to fix any outstanding issues now, before they become an emergency later.

#4 Seal Your Driveway Asphalt

Sealed asphalt driveway at pink house
Image: Cveltri/Getty
  • Your driveway takes a daily beating. Weather, sunlight, cars, bikes, and foot traffic — all of these damage the asphalt. Help it last by sealing it. Tip: The temperature must be 50 degrees or higher for the sealer to stick, making June a good month for this easy, cost-effective job.

#5 Buy Tools

Lawn tools hanging in a garage
Image: Jo Facer, The Edible Flower
  • Thanks to Father’s Day, June is the month everyone can get a deal on tools, tool bags, and that multitool you’ve had your eye on. If it’s time to replace a bunch of tools or you’re starting from scratch, look for package deals that offer several at once. These can pack a savings wallop, offering 30% off or more over buying the tools individually.

“Visit HouseLogic.com for more articles like this.  Reprinted from HouseLogic.com with permission of the NATIONAL ASSOCIATION OF REALTORS®.”

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Smart Home Security Gets Even Smarter — and Easier

Smart home security can give you a (virtual) lock on protecting your home and peace of mind.

smart home security overview boy using mobile phone to unlock smart lock
Image: Maskot/Getty
  • Once upon a time, installing a smart home security system was complicated and expensive. To get one, you had to call a professional company. They’d send an installer out to drill holes in your walls and run wires throughout your home. You’d spend big bucks for the installation and a multiyear maintenance and monitoring contract. 

But now, technology has changed that completely. You can DIY a smart home security system with moderately priced equipment. Your options include smart door locks, security cameras, video doorbells, and motion sensors you can install yourself. Smart home security systems run on Wi-Fi, Zigbee, or Bluetooth, with no wiring needed. And you can monitor these systems with an app on your phone. 

Because of this simpler, more affordable technology, home security devices are more popular. Market researchers NPD Group report that half of U.S. consumers now own at least one smart home device, up from 35% in 2020. And smart security devices are one of the most popular smart home devices. They had higher sales gains, at 44%, than any other category in 2020, says NPD Group. 

If you’re thinking of joining the fan club by adding smart home security to your house, here’s an overview of the most popular device categories.

Smart Door Lock

A smart door lock is a Wi-Fi- or Bluetooth-enabled device that lets you lock and unlock a door via an app on your phone.  Smart locks work by opening and closing a deadbolt electronically. This form of keyless entry lets you open a door with an icon tap or a voice command. That way, you won’t be fumbling for keys while your arms are full of groceries.

Pros

  • You have a lot of control over comings and goings at your house. You can see who opened the smart door lock and when, so you can check if your kids got home from school on time. You’ll know if the dogwalker showed up at noon. And you can do it while sitting at your desk at the office. “I love knowing every time my door opens or closes,” says Christy Roth, a smart home tech expert in charge of Home & Distribution Software and Devices at Schneider Electric in Spring Hill, Tenn.
  • You can give out virtual keys. These codes will let a guest or family member unlock the door with their phone. You can set the keys to expire or work only during specific times. You won’t have to leave a key under the doormat or give away house keys you won’t get back.
  • Burglars can’t pick them. Smart locks don’t have a key slot, so they’ll foil analog burglars.

Cons

  • If you lose power or your phone, you may not be able to get into your house. If you don’t have power you won’t have Wi-Fi. And that means you can’t open your smart lock. The same chain of events happens when you lose your phone. You need a backup plan, like being able to log into your smart lock from another device. It’s the digital equivalent of a spare key.
  • They use batteries. If the batteries die, you won’t be able to unlock the door. You must change the batteries periodically.
  • Digital thieves can hack them. They can try to override your entry code and unlock your door. The good news: Your lock will alert you that there’s been an unauthorized entry.
  • They’re more expensive. Smart locks cost $150 to $300, significantly more than a dumb lock.

Video doorbell

A video doorbell lets you see who’s at your door when you’re not home. The device, also called a doorbell camera, uses Wi-Fi to stream live video to your phone. Here’s how it works: When someone rings the doorbell or when the camera detects motion, an app will notify you. The video doorbell will then livestream video to your phone so you can speak to the person at the door. You can record the video and save it to your phone or the cloud, which comes in handy if you want a record of who did what on your porch. “A video doorbell is a must-have in my book,” Roth says. A lot of people agree. As of 2020, about 20 million U.S. homes,16%, had video doorbells. Industry analysts predict that number will grow significantly as more people adopt smart home technology.

Pros

  • You can answer the door wherever you are. Whether you’re on the other side of the door or the other side of the world, you can see who is at your door and ask them what they want.
  • They help stop porch pirates. Roughly 36 million Americans say they’ve had packages stolen from their porch in the last year. When a delivery person leaves a package, a video doorbell will alert you so you can bring it inside or tell the person where to stash it. If porch pirates beat you to your package, a video doorbell can help police catch the thieves because you’ll have them on camera stealing your Amazon Prime delivery. “If someone knows you’ve got a video doorbell, they’ll probably think twice about stealing your package,” says Steven Hummel, manager of the Consumer Technology Association’s market research team. “They add a lot of security to your home for not a lot of money.”
  • You don’t have to rush to the door every time the bell rings. Instead, check the app on your phone. If it’s a friend, get off the sofa and let them in. If it’s a stranger, you don’t have to interrupt your “Ted Lasso” binge.

Cons

  • Some video doorbells need to be hardwired to your existing doorbell wiring. That may not not be a DIY job, since you’d have to handle electrical wires.
  • Some run only on batteries. They’re easier to install, but you’ll need to replace the batteries every few weeks.
  • They’re more expensive than a dumb doorbell. Video doorbells cost $100 to $350, depending on the features. That’s as much as eight times the cost of an analog doorbell.
  • Some companies try to upsell you on a confusing array of services and features. You can hook your device up to a 24/7 monitoring center or get more storage space in the cloud by paying extra fees. “I can’t tell you how many $1.99 and $4.99 services many of these devices come with,” Roth says. “It can get overwhelming managing and understanding the services you need versus the ones you don’t.” If you know your needs, that will help you sort through which, if any, additional services to get, Roth adds. If you’re a regular online shopper, consider a package detection upgrade that some video doorbells offer. It will alert you when a delivery person picks up or drops off a package. Or you can opt for a basic paid subscription that lets you store, download, or share video for up to 60 days.

Motion Sensor

A smart motion sensor is a battery-powered device that detects when anything or anyone crosses its path and triggers an action. It communicates over Z-WaveZigbee, Wi-Fi, or Bluetooth. A motion sensor can do everything from turning on lights when you enter a room to telling you when your toddler is climbing out of her crib.  A lack of motion can also trigger motion sensors, so lights will turn off when no one is in a room. You can run motion sensors through an app on your phone to control devices including smart lights and speakers just by tapping an icon.

Pros

  • You can install motion sensors easily and almost anywhere. You can mount them on the wall or set them on a flat surface in minutes.
  • Motion sensors can lower your energy bills. A motion sensor can tell smart bulbs, smart speakers, and TV sets to turn off when a room has been empty too long or at a set hour each night.
  • You can use them to turn a houseful of smart home gadgets into a smart home. Place motion sensors around your home, link them to your smart devices via your smart speaker, and the sensors can help everything work together.
  • They’re super affordable. You can get a motion sensor for as little as $20.

Cons

  • Motion sensors use batteries. You’ll need to check and change them regularly to keep them working. Most will let you know when the batteries are getting weak.
  • If they run on Wi-Fi, they may hit dead zones in your home and stop working. You’ll need to boost their range with a mesh router ­– also called a mesh network – that pairs two or more routers together to deliver a seamless Wi-Fi network. If your home is larger than 3,000 square feet or multistory, a mesh router is a good idea. A bridge – a device that joins two or more Wi-Fi networks so they can work as a single network – will also boost your home’s Wi-Fi coverage.

Security Kit or Home Monitoring System

If you want your DIY smart home security to go bigger than one or two devices, get a security kit. Also known as a home monitoring system, these kits replace the home alarm systems you used to have a pro install. They generally come with contact and motion sensors, a base station that’s the wireless brain of the system, and touch-screen control panels.

Pros

  • You can customize the system. Adding security cameras, glass break sensors, panic buttons, and environmental sensors will alert you to gas leaks, water leaks, or fire.
  • You can integrate your other smart tech devices. Many home security systems double as smart home hubs so you connect and automate your other smart devices into a single network. You can connect your alarm, your smart locks, your smart thermostat, and your video doorbell and run them all with an app on your phone.
  • You can save money on homeowners insurance. Some insurance companies give policy discounts for homes with security systems that include window and door sensors, smart locks, or video doorbells. They don’t give discounts for individual devices like video doorbells.
  • The kits are more affordable than professionally installed alarm systems. Home monitoring systems start at $200 to $400 for a basic setup.

Cons

  • You will have to pay extra for professional monitoring. Unlike professionally installed alarm systems, you don’t get a team of trained dispatchers who will monitor your alarm 24/7. That’s part of the reason DIY systems are so much more affordable. Many home monitoring systems offer professional monitoring for an extra monthly fee that ranges from $10 to $40.
  • You’re the tech support. Unlike professionally installed systems, there’s not a tech on call to fix glitches. It’s just you and You Tube tutorials.

Smart tech security devices make it easy and affordable to protect your home. You can install many of these devices yourself and only pay for a monitoring plan when you want it. You can keep an eye on your family and your home from any location via sensors and cameras directly from your phone. Video doorbells, smart door locks, motion sensors, and home monitoring systems put high tech security at your fingertips.

“Visit HouseLogic.com for more articles like this.  Reprinted from HouseLogic.com with permission of the NATIONAL ASSOCIATION OF REALTORS®.”

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