Selecting a Mortgage Loan

Posted on August 25, 2021 by Debbie Prosser

Whether you’re shopping for new bed sheets or a new car, the drill is usually the same. Hit the reviews, check with friends, and scope out the best deal. After all, who wants to buy a car that racks up repair bills right away? Yet when picking a mortgage loan, borrowers don’t always think about comparison shopping.

In a Bankrate survey of recent home buyers, 12% of millennials said they believe their mortgage rates were too high. Some buyers may think that when mortgage rates are low, they don’t need to shop for the best offer. But even a few basis points can make a difference of thousands of dollars over the life of a loan, according to Bankrate, the Consumer Financial Protection Bureau, and the Federal Trade Commission.

You may think mortgage shopping is as enjoyable as prepping for a tax audit. It’s true that comparing home mortgages can get complicated. But you don’t need a finance degree to make an informed decision. Here are some steps to get there.

Find a Few Lenders
When looking for lenders to consider, loan officers recommend going to a few sources:

  • Locals you know and trust: “Make sure the lenders you’re comparing come from referrals from local people you know who’ve worked with them — like your friends or relatives,” advises Jeff Koch, vice president of residential lending at Draper & Kramer Mortgage Corp in Schaumburg, Ill. “Wherever you have trust established would be a good source.”
  • Your real estate agent: “If you’re working with a real estate agent, find out if they have any feedback or advice on a lender or a loan officer,” recommends Jim DeMarco, branch manager and senior loan advisor at Flagstar Bank in Seattle.
  • Online reviews: These can be a good starting point, DeMarco says. “If you see a lot of really good reviews, that means people are taking the time to provide them.”

Have an Intro Mortgage Loan Meeting
During a meet and greet, you and the loan officer will usually ask each other questions, and the loan officer will use that information to assess your qualifications. That may sound cut and dried, but the meeting should be fluid based on what you’re ready to do.

Typically, the loan officer would schedule a meeting focused on comparison shopping separately. If that sounds painful to borrowers who want to (literally) get moving, no problem, Koch says. “The borrower may be well versed and want to get right to what’s most relevant for them, which are the financial and comparison details. But a lot of people need to go over their own questions or cover key topics first.”

Want to meet virtually? “Some folks are just more comfortable virtually, and that’s OK,” DeMarco says. “I’ve closed loans with people I’ve never talked to on the phone. It’s all via text.”

Interview the Mortgage Loan Officer
Whichever way you choose, this meeting is prime time to interview the loan officer. Borrowers need to find someone who will be in there with them and who can problem solve. “We call unanticipated problems ‘icebergs,’” DeMarco says. “You think there’s smooth sailing. And then, suddenly, you smack into an iceberg.”

Scope out the lender’s communication strategy and their process for delivering on time. “The process is highly complex, and you’d think professional lenders all would have mastered it. That’s not the case,” says Koch. “When a loan is not delivered on time, people’s finances and lives are basically balanced on the head of a pin, which is the closing date.”

To avoid problems, ask questions like these:

Fact finding about the process:

  • Would you take me through the process?
  • What should I expect?
  • What will I need to supply?

Compatibility with the loan officer or mortgage banker or broker:

  • What’s your communication style? Are you willing to communicate virtually?
  • When would I work with you? Are you available in the evening?
  • Will I be working with you or a member of your team?
  • What do you think of my time frame to get to closing?
  • What if any issue do you foresee being a problem?

Track record of loan officer and lender:

  • How long do loans you process typically take to close?
  • What are some ways you could expedite the process if there’s a tight time frame?
  • About what percentage of loans you work on close on time?
  • How many loans have you worked on that haven’t closed or haven’t met deadlines?
  • What’s the biggest problem you’ve had with a loan and how did you fix it?

Use the Meeting to Learn
You can also use the meeting to clarify general info you’ve picked up online and talk about your concerns. DeMarco gives an example. “You may have switched careers or industries in the last year or started having bonus or commission income. Your research may have shown that you can just divide your salary by 12 to figure monthly income. But it may not be as simple as that.”

You’ll also want to bring up concerns like the impact on your credit score. Thirty-eight percent of buyers think comparing multiple mortgage offers in a short time will hurt their credit rating, according to a 2020 LendingTree survey. “As long as the lenders all pull the borrower’s credit within a couple of weeks, it’s counted as a single credit inquiry. So, it’s not a problem if they do it within a narrow band of time,” Koch explains.

Get and Compare Financial Information
Whether you’re looking at a federal form called a loan estimate or a precursor form called the fees worksheet, you’ll see a breakout of closing costs, explains Koch. “To compare the lender financials, you’ll want to drill down to origination charges in the lender section. Make sure you’re comparing apples to apples. If one lender is offering a 30-year fixed rate at 2.875% with no lender fees and another is offering 2. 75% with $1,500 in lender fees, those are unlike products. Get the fees at the same rate to find out who’s less expensive.”

6 Tips to Get Mortgage Loan Information
Comparison shopping can get complicated. Here are six ways to simplify the process.

1. Keep Your Pool Manageable
Mortgage shopping “depends on the borrower and the personality type and how they’re wired,” Koch says. “The process can seem overwhelming. That’s why it makes sense to have a select few options to compare so borrowers can process and assimilate them.”

2. Get a Fees Worksheet
The best way to compare effectively is to zero in on the fees worksheet, which the loan officer should provide. “You’ll be able to figure out just what the lender’s direct fees are, and you can make a nice, simple comparison.”

3. Understand a Fees Worksheet Versus a Loan Estimate
Keep in mind that the numbers on the worksheet are estimates and not locked in. Interest rates are fluid and change daily or even more often, DeMarco says. On the other hand, after you have a contract with a seller, “the loan estimate and loan application are where the information is binding barring structural changes to the loan,” Koch says. Make sure the information reflects previous discussions with and disclosures by the loan officer.

4. Be Careful Interpreting Third-Party Fees
Third-party fee estimates are included on the worksheet. Two lenders could each come up with different estimates for title, escrow, or appraisal fees, Koch explains. But not all are negotiable. For instance, the seller chooses the title company, so the lender doesn’t control the choice or the fees. The lender could be choosing the high or low end of a range, but it’s only an estimate.

5. Think About Timing
Make sure lenders are using the same time frame for locking in pricing and that it will extend through the closing, Koch notes. “A lender might offer a rate that’s a lock for three weeks, but if you anticipate or know your closing date will be five or six weeks out, that’s a problem.”

6. Consider Applying for Loan Approval Before Finding a Property
“Many lenders will not do this,” Koch says. “But some will allow borrowers to go through the formal underwriting process — not just preapproval — without having a property. The borrowers can get a bona fide mortgage commitment with all of the major buyer financials truly underwritten at that point. Then when borrowers make an offer, they can close more quickly.”

You’ll have to invest some time and effort into comparison shopping for a mortgage loan and selecting a lender and a loan officer. But your return on investment can pay off over the long haul.

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

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Decluttering your Garage with Outdoor Storage

Posted on August 23, 2021 by Debbie Prosser

“That can go in the garage” is a common solution to just about anything outdoorsy that needs a home.

Instead, think outside the garage. These ideas are great for decluttering your garage — and they’ll pay dividends when it comes time to sell. Because clutter never increases a home’s selling price.

#1 Tuck Storage Under Your Deck


An elegant solution if you’ve got a deck that sits up fairly high. You can tuck loads of outdoor tools and equipment under it. Even add doors to help keep things out of sight. A perfect solution to decluttering your garage.

One caveat: This type of storage will protect items from the heat and sun, but not from moisture, so unless you add a ceiling to your under-deck shed, only store things that can handle some wet.

If your deck lacks height: try storage drawers instead.

Store pool equipment, folding deck chairs, yard games, and coolers within easy reach, and you’ll hardly break your outdoor-happiness zen when you need to grab something.

#2 Build a Fence With Built-Ins


Think of it as the outdoor version of an indoor wall with built-in storage. But outdoors it delivers so much more: privacy, security, and storage. It’s the trifecta of functionality.

#3 Add a Purpose-Built Shed


This pup’s family obviously loves biking and campfires — and they’ve got just the right size and configured shed to store the bikes and wood efficiently.

Maximize your outdoor space by noodling on your storage pain points, then building something to fit your purpose. You’ll get rid of the clutter, and you’ll prevent some pre-fab shed from taking up too much space and becoming yet another place where clutter accumulates.

“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 to Find the Right Realtor

Posted on August 20, 2021 by Debbie Prosser

For every journey, there is a guide. To navigate his magical powers, Harry Potter had Dumbledore. To channel the Force and save the galaxy, Luke had Yoda. And to navigate the constantly shifting real estate market, you have a Realtor.

Your agent is a licensed professional who’s familiar with local home values and neighborhood perks, understands real estate trends, can write an offer on your behalf, and who negotiates with home sellers so you don’t have to.

Think of your agent as a therapist/consultant for your home search. A collaborator. A co-conspirator. A mentor. Someone who amps up your confidence and counsels you through big decisions (teamwork makes the dream work, after all). And someone who wants you to find a house you can be happy in because they’re invested in your happiness.

If the housing market doesn’t line up with your needs and budget, your agent will go back to the drawing board with you. They interpret raw housing data through the filter of your unique search, then tell you what’s important and why. They help you map the path to your goal, and connect you with trusted experts who can get you into your dream home. (Cue selfie of you drinking wine in your new living room. First like on Instagram? Probably your agent.)

That’s a lot of responsibility. And a lot of pressure. There’s obviously a lot at stake: money and time, of course, but also your happiness. So reach out to an agent sooner in the process rather than later, and you’ll be on the fast track to picking out paint swatches for your new kitchen.

Agents, Brokers, and REALTORS®: What’s the Difference?
“Agent” is a catchall phrase that is used, in casual conversation, to describe the three types of professionals who buy and sell real estate: agents, brokers, and REALTORS®.

No, they’re not really the same. Yes, you should care about what makes them different. Here’s a breakdown:

A real estate agent is a licensed professional who helps people buy, sell, rent, or invest in homes. To become an agent, a person must take pre-licensing training from a certified institution (these vary from state to state) and pass their state’s real estate licensing exam. Once they have their license, an agent must affiliate themselves with a real estate brokerage.

Some agents specialize in representing buyers, some specialize in representing sellers. Some do both. An agent who represents both the buyer and the seller in the same real estate transaction is called a dual agent. By law, a dual agent must disclose dual agency to both parties. (If an agent is seeing other people, you obviously need to know.)

A real estate broker is a professional who has additional education beyond the agent level, as required by state law, and who has passed a broker’s exam. In some cases, brokers also have more years of experience than agents. The biggest difference between a broker and an agent is that a broker may work independently. An agent must be overseen by a broker.

A REALTOR® is a broker or agent who belongs to the National Association of REALTORS® (NAR), the largest trade group in the country. (Full disclosure: NAR publishes HouseLogic.com). A REALTOR® commits to following a strict Code of Ethics intended to protect buyers and sellers; for example, REALTORS® pledge themselves to protect and promote the interests of their client. Agents and brokers who are not NAR members can’t call themselves REALTORS®. There are more than 1 million REALTORS® in the United States. You can use realtor.com®’s Find a REALTOR® tool to connect with one in your area.

The Best Agent for You Depends on … You
Before you seriously partner with anyone, you’ll probably survey family, friends, and trusted acquaintances for at least some input. Finding a real estate agent is no different: A great starting point is to ask your inner circle and neighbors for recommendations. According to recent NAR research, 52% of buyers 36 and younger found their real estate agent through a referral.

Then there’s the internet.

Each of the major property listing websites — realtor.com®, Zillow, Redfin, and Trulia — has an agent-finder tool that lets you search for agents in your area. These property sites also collect reviews and ratings from an agent’s past clients, which gives you insight into an agent’s reputation. Keep in mind, though, that the sites vary in their policies about whether agents can edit or remove reviews. (Like with Yelp, use your own discretion.)

The sites also show an agent’s sales history, so you can see how many homes a person has sold. In general, it’s best to choose an agent who has a large number of sales under his or her belt (a sign they’re committed to real estate work). Perhaps even more important: an agent who has sold homes at the price point and in the neighborhood where you’re looking to buy — a sign they understand the local market.

Whatever you do, don’t rely on online listings alone. Always interview prospective agents — at least three — in person. A meet-and-greet will give you the perspective you need on the agent’s personality and style. Is this someone you’ll like working with? Who has a sense of humor? Who has your back? Who communicates in the ways you want to be communicated with? Best to find out in person.

How to Know If An Agent Is Knowledgeable
Once you’ve gathered all the information, listen to your gut: It won’t steer you wrong about who’s the best agent for you.

But, that said, there are a few qualities you’ll want to look for in any agent (your gut would agree):

  • Local expertise. Does this person know their stuff about neighborhood home value trends, shops and restaurants, schools, commute times, and geographic factors such as floodplains? These things are important, especially if you’re looking for a home in a new city or town. If the agent seems lost or like they’re winging it, keep looking.
  • Responsiveness. You’ll have a lot of questions, and will be asked to produce documents at certain steps during the buying process. Think about how available you want your agent to be, and how quickly you want him or her to respond. One way to figure that out? Contact a prospective agent online or by phone and see how long it takes them to reply. If you don’t hear back within a timeframe that works for you, it’s probably best to move on.
  • Reputation. This is when to consult your inner circle again. The agent-finder tool mentioned above can also help. In addition, you’ll want to verify the agent’s license; search “[state] real estate license lookup” in your browser to find a resource for your state. If you want to confirm whether an agent is a REALTOR®, you can call NAR at 1-800-874-6500.

There are a number of professional designations that indicate an agent has obtained additional education beyond their licensing work. An accredited buyer’s representative (ABR®), for instance, is someone who specializes in working with home buyers and has taken a course on buyer-client relationships. You can search the different types of designations here.

Don’t Be Afraid to Ask a Lot of Questions
Congratulations! You now have a list of agents you like based on their stats, and you’re ready to get to know the finalists. Binge a few episodes of “The Bachelor” for pointers — just kidding, don’t do that.

What to really do: Schedule interviews with the top three agents, at least. During each conversation, your goal is to understand the agent’s experience, personality, and working style.

Here are 14 questions that will help the vetting:

  1. One on One or Team?
    Some agents who close lots ‘o deals have a team — assistants who specialize in parts of the transaction. It’s like having multiple agents working for you. But it’s up to you to decide if that’s your jam or you prefer your agent be your one and only.
  2. How many years have you been in the business? Having more experience doesn’t guarantee that someone is a great real estate agent, but a lot of the business is learned on the job.
  3. How many homes have you sold in the last year? Volume isn’t the most important factor when choosing an agent, but you want someone who is active in the industry. Also, the more transactions an agent has under their belt, the more adept the person should be at solving complicated problems that can crop up during a home sale. Remember: Your transaction is unique.
  4. How will you help me determine my needs and priorities? The agent’s first task is to help you identify your list of “musts” and “wants” — the home features that you need, versus the features that you’d like to have but can live without.
  5. Is your real estate license in good standing? You can also check with your state’s Real Estate Commission to confirm the agent has no disciplinary actions.
  6. How will you stay in touch with me? Your agent’s communication style should align with yours. If you prefer to be contacted via text when new listings crop up, make sure your agent is able to do that.
  7. What neighborhoods do you specialize in? You want an agent who’s intimately familiar with the neighborhood(s) you’re interested in. Another way of framing this question is to ask, “How many homes have you sold in this neighborhood in the last year?”
  8. What price range do you typically work in? In addition to being a neighborhood expert, your agent should do a large portion of their business with home buyers in your price range. It’s important because challenges and negotiation strategies can vary based on what type of home you’re buying.
  9. How many other clients are you working with? You want someone who can give you quality, one-on-one customer service when you buy your first home. If the agent seems spread thin, it’s probably because they are.
  10. How are you a good agent for first-time buyers? First-time home buyers face specific challenges. Every buyer has a unique transaction. Good agents can explain what you should expect and how they’re going to help you navigate your special circumstances.
  11. How will you find homes that match my criteria? Seasoned real estate agents don’t just use the local Multiple Listing Service (MLS) — a regional database of registered property listings — to help home buyers find homes. They also keep track of listings through colleagues, door-knocking, and canvassing neighborhoods to find the right properties for their buyers. They’ll also work their industry connections.
  12. Have you ever recommended that a buyer not buy a property? Why? An agent should work in your best interest, which means being honest with you about when to pass on a house that will not meet your needs — even if you’re starry-eyed about it. It’s your choice, obvs, but they should empower you to make a sound decision.
  13. Do you have a list of recommended vendors who can help me get a mortgage, inspect a home, and so on? To buy a home, you’re going to need other important players on your team — specifically a mortgage lender, home inspector, settlement/title company, and attorney. An experienced agent has already developed relationships with reputable pros, and should provide you with several references for each; though it’s ultimately your decision to choose who you want to work with.
  14. Can you provide contact information for your three most recent buyers? Past clients can offer valuable insight into an agent’s skills. Don’t just ask an agent for references, or you’ll get three pre-vetted clients who are guaranteed to sing their praises. Instead, ask for phone numbers and email addresses of the agent’s three most recent buyers. Contact those people directly to learn about their experiences.
  15. What is a REALTOR® and why should I work with one? A REALTOR® is a broker or agent who belongs to the National Association of REALTORS® (NAR), the largest trade group in the country. (Full disclosure: NAR publishes HouseLogic.com). A REALTOR® commits to following a strict Code of Ethics intended to protect buyers and sellers. And REALTORS® pledge themselves to protect and promote the interests of their client. Agents and brokers who are not NAR members can’t call themselves REALTORS®. You can use realtor.com®’s Find a REALTOR® tool to connect with one in your area.

Whew, you made it through the interviews. (Are you thirsty? We could use a glass of water.)

By now, there’s likely one agent left standing. Someone you can trust. Someone who listens. Someone who knows more about real estate than you, but who also really cares about finding your house.

Now that you’ve got a partner in buying a home, it won’t be long before you own it.

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

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What does Homeowner’s Insurance Cover?

Posted on August 16, 2021 by Debbie Prosser

What does your homeowners insurance cover? The short answer is: A basic homeowners insurance policy (called HO-1 in insurance lingo) covers your home and possessions if they’re damaged or destroyed by these things:

  • Fire
  • Lightning
  • Windstorm (unless you live in a hurricane zone)
  • Hail (not available everywhere)
  • Explosion
  • Riots
  • Civil commotion
  • Aircraft (and things falling from aircraft)
  • Vehicles (and things thrown from vehicles)
  • Smoke
  • Vandalism (although some policies exclude this)
  • Malicious mischief
  • Theft
  • Volcanic eruption

But many states don’t allow this basic policy to be sold. Instead, you have to buy an upgraded policy that covers more perils.

Upgraded Homeowners Insurance
That upgraded policy (called HO-2) adds protection to your home and possessions from even more perils. You get protection from everything on the HO-1 list (above) plus:

  • Falling objects
  • The weight of ice, snow, or sleet
  • Flooding from your appliances, plumbing, HVAC, or fire-protection sprinkler system
  • Damage to electrical parts caused by artificially generated electrical currents (such as a power surge not caused by lightning). But damaged electronics such as computers aren’t covered.
  • Glass breakage
  • Abrupt collapse (say from termite damage)

That same list applies to the homeowners insurance you buy for a condominium or co-op (except then it’s called HO-6 instead of HO-2).

With HO-1, HO-2, and HO-6, what you see is what you get. So if zombies attacked your home, your HO-1 or HO-2 wouldn’t cover the damage because zombies aren’t on the list of specific things those policies cover.

The Most Complete Homeowners Insurance
The most complete and protective form of homeowners insurance (called HO-3) covers you for all perils except some specific ones like:

  • Floods
  • Earthquakes
  • Wars
  • Nuclear accidents
  • Landslides
  • Mudslides
  • Sinkholes

With this policy, if zombies attacked, you’d be covered because zombies weren’t specifically excluded by your HO-3 policy.

What Homeowners Insurance Doesn’t Cover
No matter which basic policy you get, it’s not going to cover everything than can damage or destroy your home. Typical homeowners policies don’t cover:

  • Bad things that happen because you failed to maintain your home (like mold)
  • Hurricanes
  • Floods
  • Earthquakes
  • Mudslides
  • Landslides
  • Sinkholes
  • War
  • Nuclear accidents
  • Sewer backups
  • Sump pump failure
  • Ground movement and holes caused by mining (known as mine subsidence insurance)
  • Pollution

You can buy additional policies to cover some but not all of those perils (a quick Google search didn’t turn up any nuclear accident coverage).

And even if insurance is available for the most common natural disaster in your area, you may not be able to buy it if your home has features that make it vulnerable. For example, a home with unrated wood shake roof shingles may be tough to insure in an area where wildfires are common.

Other Things Homeowners Insurance Covers
In addition to covering your home, homeowners insurance also covers four more things:

1. Your outbuildings, landscaping, and hardscaping. If you have outbuildings (like a barn), landscaping, or hardscaping (like fences), your homeowners policy most likely covers those for up to 10% of your policy amount (5% for plants).

For example, if you have $100,000 in homeowners insurance and someone drives into your fence, the policy would cover 10%, or $10,000 in repairs.

Sometimes policies exclude damage to outbuildings, landscaping, or hardscaping caused by a particular peril (like wind).

2. Damage or loss of your personal belongings. Your homeowners policy covers your family’s belongings, even when you take them out of the house. If your child heads to college with a laptop and it’s stolen, that’s probably covered by your homeowners insurance policy.

A home insurance policy covers a lot of your personal belongings, but not necessarily everything.

You’ll need additional insurance if you have many expensive items like jewelry, furs, or antiques.
Policies will either state that your personal belongings are insured for replacement cost or cash value.

Replacement cost means that the insurance company will pay the full cost of replacing an item (such as the laptop mentioned above, or a sofa damaged in a fire) once you show a receipt. Cash value means the insurance company will issue you a check for the amount that the laptop or sofa would have been worth when it was stolen or destroyed.

3. Temporary living expenses if your home is so damaged you can’t live in it. When you can’t live in your home, your homeowners insurance covers your living expenses, including hotel bills and meals. But, you can’t live in the hotel forever and eat lobster every night on the insurance company’s tab. Your policy will have limits on how long you stay and how much you can spend.

4. Injuries or accidents at your house. Homeowners insurance coverage includes liability – meaning it covers you when you or your family members cause injuries or damage. This coverage also pays when your dog bites someone (medical payments) or someone falls and injures themselves.

Add an umbrella policy to boost your liability coverage into the millions.

Homeowners Insurance for Older Homes
There’s another kind of homeowners insurance (HO-8) used when your home is so old it would be impossible to replace. It couldn’t be built like the original — that is, new electrical code wouldn’t permit the same electrical, etc.

An HO-8 policy covers the same perils as the basic HO-1, but will only pay you the repair cost or market value instead of the replacement value.

If your home is old, but not so old that it’s historic, you might want another homeowners insurance coverage. A “law and ordinance” policy covers the cost of rebuilding using today’s building codes. It’s good to have if the building codes have changed a lot (for example, in Florida) since your home was built.

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

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To Zillow or Not to Zillow?

Posted on August 11, 2021 by Debbie Prosser

Zillow Logo | Symbol, History, PNG (3840*2160)When looking for available homes in your area, the first website to appear on your browser will likely be Zillow. You may peruse the user-friendly site, find a home you love, and contact the listing agent only to find that the home is no longer for sale. Discouraged but still determined to find the perfect house, you continue your search and find an even better home for a screaming deal. You reach out to the agent to find that the asking price has been significantly raised and is no longer within your budget.

Is this the way house hunting is supposed to be?

Zillow is a real estate advertising company that has only grown in popularity since it was founded in 2006. It acquired its first competing company, Postlets, in 2011, and has acquired 13 other companies since then. Zillow gets information directly from Brokers who pay to have their listings advertised on the site, so it must provide an accurate and updated picture of the market in your area, right? Well… Not quite.

The most accurate database for real estate properties is the Multiple Listing Service, or MLS. Certified real estate professionals pay an annual fee to list homes on this site as well as have access to information for all other homes on the market. There are many rules and regulations that Realtors must follow in order to use this site, such as providing accurate information and updating price changes, sale status, etc… Zillow, on the other hand, has no such regulations. This means that Brokers are not responsible for updating listings, and it also means that fraudulent listings may appear on their site so long as the advertising fees are paid.

Zillow has long been criticized by Realtors and homeowners alike for providing an often inaccurate ‘Zestimate’ of a home’s value. But beyond informational inaccuracies, what’s wrong with browsing the homes in your area to see what options are available to you? The biggest reason not to Zillow is that you are not given the full picture of an individual home, or of all of your options. Even if you had access to the Multiple Listing Service that Realtors use (and there just might be a way for you to gain access- keep reading), numbers and photos don’t provide all you need to know about a potential home. Is this home at its current price a good investment? Are the repairs and updates needed going to be worth our time? Is this house the best option we have available to us? These are all questions that no existing algorithm is able to answer for you. Only an experienced Realtor can guide you to not just a house, but a home.

A Realtor can provide you with valuable insight into a home, but especially in today’s fast-moving market there’s no way they can take you to visit every available listing. So is there a way to browse homes from the comfort of your couch? The second most popular option for viewing homes online is Realtor.com, which is a site operated by the National Association of Realtors. This website gets information directly from local real estate boards, and is therefore updated more regularly than Zillow. However, Brokers can pay to have their listings moved up in search results, which means that you are getting a biased view of what the market looks like. You may miss out on seeing the perfect home because your search results are skewed.

Enter Distinctiveprop.com: We offer a constantly updated search tool that allows you to filter based on your needs, shows every available listing including commercial and land listings, and allows you to schedule a viewing directly with one of our experienced Brokers. Each listing will tell you an up-to-date asking price, square footage and acreage, the year the home was built, public comments from the listing agent, and all available photos. We even offer a mortgage estimator tool that can give you an idea of what your monthly payment might look like for each listing. You can create an account and save favorites, so that even if a home leaves the market quickly your agent can get a clear picture of what you’re looking for and keep a sharp eye out for you.

We are not out to get Zillow, but we know that Zillow is only out to get money and does not necessarily have your best interest in mind. Allow us to provide quality, tried, educated service through our website and through the personal service of any one of our experienced Realtors.

Check out our search tool here.

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Home Appraisals Step by Step

Posted on August 9, 2021 by Debbie Prosser

Most people have deeply personal reasons for wanting to buy a home. Maybe it’s the bathroom that feels like a dreamy, modern spa. Or that two-tiered deck just made for parties.

Your lender doesn’t care about the freestanding tub. Or the built-in outdoor fire pit. Their only concern is that the house you buy is worth as much as the value of your mortgage.

To them, a house isn’t a home. It’s collateral. (Harsh, but true.) If someday, for some reason, you can’t make your mortgage payments, the lender can foreclose on the home and sell it to recoup all or some of its costs. (Even harsher, but also true.)

For that reason, a home must be valued at, or above, the agreed-upon purchase price, and this has to happen before you can close on a house. That’s where a home appraiser comes   in.

A Home Appraiser Is Neutral
After you sign a home purchase agreement (the contract between you and the seller about the terms of the pending sale), and before your lender approves your loan, the home you’re buying must pass an appraisal — an assessment of the property’s value by an unbiased third party: the appraiser.

An appraiser is a state-licensed or -certified professional. Their job is to assess an opinion of value — how much a house is worth. The appraiser is on no one’s side. They don’t represent you or the seller; instead, this person is a contractor chosen by your lender through an appraisal management company (AMC), a separate, neutral entity that maintains a roster of appraisers.

Appraisers survey a house in person, using five main criteria to determine the value of a home:

  • Location
  • Age
  • Condition
  • Additions or renovations
  • Recent sales of comparable homes

Be Prepared to Pay for the Appraisal — or to Negotiate
Generally speaking, the home buyer is responsible for paying for the appraisal — and the fee is typically wrapped into your closing costs. However, who pays for appraisal is negotiable. It never hurts to see if the seller is willing to cover it.

How much money are we talking about? The average professional home appraisal will run between $287 and $373, according to estimates by the home-professionals resource HomeAdvisor.com. Costs can vary depending on the square footage and quirks of the house, with higher appraisal prices for larger or more unique homes.

Appraisals Take a While, So Be Patient
Typically, a purchase agreement has a “home appraisal contingency” requiring that the appraisal be completed within 14 days of the sales contract being signed. Because it takes appraisers some time to visit your house and write a report — up to a week, or longer in a busy housing market — your lender will order the appraisal immediately after you sign the purchase agreement.

So, You Have a Valuation. Here’s What It Means — and What to Do Next
When the appraisal is finished, the appraiser issues a written report with his or her opinion of the value of the home. To produce the report, they use their analysis of the property and data from comparable homes, as well as review the purchase offer. The report will outline their methodology and also include photographs that they’ve taken of the property, inside and out.

You and your lender will both receive a copy of the report. Three things could happen next:

  • If the appraiser’s valuation matches the price you and the seller agreed to for the home: Your lender will proceed to underwrite your loan. Great news: This is the final step in your loan-getting process!
  • If the appraiser’s valuation is higher than what you’re paying for the home: Congratulations! You’ve gained immediate equity. How, you ask? Let’s say, for example, you’re paying $200,000 for the house. If the appraiser says it’s worth $250,000 — jackpot. That’s an instant $50,000 in equity. (Keep in mind, this is very rare.)
  • If the appraisal is lower than what you’ve agreed to pay for the home: Your lender won’t give you a loan for more than the appraised value. If you and the seller agreed on $200,000, for example, but the appraisal is $190,000, that creates a $10,000 shortfall. So what happens next?

Don’t despair — not yet. If you’re faced with a low appraisal, there are several ways the deal can still go through.

If an Appraisal Is Low, You Can Still Make It Work
Before we talk strategy, some reasons why appraisals come in lower than expected:

  • The seller overvalued the price of the home.
  • The appraiser isn’t familiar with the neighborhood.
  • The appraiser overlooked pending sales data.
  • The appraiser had trouble finding comparable homes, or missed comparable homes, so they compared your home with properties outside the neighborhood.
  • Home prices in the area are changing so fast that the listing agent’s price no longer reflects the market.
  • The appraiser rushed the job.

If the appraisal comes in low, your agent will offer recommendations about how to proceed. In general, your best strategy is to persuade the seller to lower the sales price, or to split the difference between the home’s appraised value and the price with you. This is when you can rely on your agent – and their negotiating skills – to go to bat for you.

You can also appeal the appraisal assessment. You’ll work with your agent to research comparable homes that support the sales price you agreed upon with the seller and present this information to your lender, who will forward it to the appraiser for a re-evaluation of the home’s value. Ultimately, though, it’s up to the appraiser to decide whether to revise their valuation of the property.

Alternately, you can ask your lender for a second appraisal, though there are caveats:

  • You’ll have to pay for it out of pocket (or persuade the seller to foot the bill).
  • You’re more likely able to challenge an appraisal for a conventional loan than a government loan. And you’d need solid facts to back it up in either case.
  • There’s no guarantee that it will be higher and meet the sales price.

The last option: You can come up with the cash yourself to cover the difference between the home’s price and the appraised value.

If you don’t want to take that route (and who could blame you?), a purchase agreement’s home appraisal contingency gives you the ability to walk away from the deal scot-free, and with your earnest money deposit in hand.

But today, let’s assume it all works out. With the appraisal behind you, you’ll be one step closer to closing on that 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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Needs vs Wants in a Home

Posted on August 4, 2021 by Debbie Prosser

When you embark on the home-buying process, your heart is filled with all the dreams in the world. It’s really easy to get caught up in the “I have to have ___________, so I’ll cut back somewhere else ” game, even when you don’t actually know where that somewhere else is or if you can realistically cut back there.

This post will show you how to pare down the excess and make sure to get the things you really NEED.

Make a List of Wants
Start by making a list of everything you want in your house. If you love it, jot it down. Have your spouse or partner do the same thing in a separate document.


Once you and your partner have everything down, start sorting your wants by order of importance. What’s your No. 1? Do you need large windows? How about a sunroom? Double sinks in the master? You get the idea.
Come up with your top 10, and then compare your list to your partner’s top 10. What things appear on both lists? Those items should carry more weight because you both want them in your home.

Highlight the Important Stuff

Next, look at your list and consider:

  • The things that can’t be changed without a massive investment. I’m talking things like square footage, window size, and number of bedrooms. This is your heavyweight list. These things should take priority in your home-buying decision.
  • Features that are purely cosmetic, especially things that can be DIYed. These items should be moved waaay down the list or taken off entirely. Backsplash tile, paint color, and lighting can all be changed inexpensively and after you’re living in your house. You don’t want to pass up a fantastic house because you can’t see past a red accent wall.
    At this point, you should have a combined list of 10 or so items.

My last tip is to figure out the priority of each one of the items. Ask yourself, would you be willing to give up item number 4, say, to have item number 5? Would you be willing to give up hardwood floors for a home theater room? This is the hardest question to answer, but it’ll put your must-haves in the right order.

I always picture this activity like an eye appointment when the doctor says, “1 or 2? OK, now 2 or 3?” Do that with your list! Pool or flooring? Flooring or yard size? Yard size or square footage? Make sense?

Bring Your List When You Look at a Home
As you’re out looking at houses, keep your list handy. Maybe you’re not willing to give up hardwood floors for a jetted tub, but would you be willing to compromise for a jetted tub and extra square footage? Refer back to your must-haves list often. It’s easy to get distracted.

Here’s a quick checklist that I use when searching for a home. If you answer “yes” to all of these, then a “want” may be worth the splurge — that is, if you can be sure that you’ll be able to afford the feature (in terms of your monthly mortgage payments and living expenses).

  1. Is it on both of your lists?
  2. Is it something that’ll be extremely expensive and difficult to change or add?
  3. Would you be willing to sacrifice something else to have it?
  4. Would you feel like your house would be incomplete without it?

Happy house hunting!

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

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Protect your Home from Wildfires

Posted on August 2, 2021 by Debbie Prosser

How do most homes ignite during a wildfire? A floating ember or piece of burning wood touches down on a roof, gutter, in a vent, under a deck, or on a porch and ignites leaves and debris, says the National Fire Protection Association. Or else, a surface fire simply takes the fast lane to your home via dry vegetation.

With that in mind, fortify your home like the castle it is with these 13 wildfire-repelling steps. But keep in mind that no product or technique is a failsafe against a raging fire.

#1 Check Smoke and Carbon Monoxide Detectors
If you don’t already have working smoke detectors or haven’t tested them recently, make that your No. 1 job. Now.

#2 Check Fire Extinguishers
And if you don’t have them, get them.

#3 Get a Bucket, Shovel, and Hose Ready
Have an easily accessible bucket, shovel (to dig a trench to protect against encroaching ground fire), and connected garden hose to help you defend the area around your home.

#4 Invest in Rain Barrels
An extra source of water can’t hurt. And rain barrels save on your water bills, too.

#5 Clear Yard of Debris
Keep gutters, porches, and the lawn free of debris, leaves, and fallen branches. If a fire threat is imminent, remove furniture and decorations from decks and porches, including welcome mats.

#6 Plant Fire-Resistant Shrubs and Annuals
Like irises, rhododendrons, hostas, and lilacs, which have high-moisture content. Your local Cooperative Extension Office can advise you on appropriate species for your area.

#7 Remove Tree Branches Lower Than 6 Feet
Fires tend to start low and rise. For that reason, don’t plant shrubs directly under trees; they can combust and cause the fire to rise up the tree. By the way, spacing out all plants and shrubs is a good practice, too.

#8 Remove Tree Limbs Near Chimneys
Keep them at least 10 feet away. Embers from burning limbs could fall in.

#9 Set Up a Protective Perimeter
Create a 100-foot perimeter around your home, free of dry leaves, grass, and shrubs that fuel wildfires. Keep petroleum tanks, cars, and wood piles outside of this safe zone.

#10 Use Rocks Instead of Mulch Next to the House
Lay a six-inch swath of decorative rocks closest to the home and then use mulch from there. This also helps repel insects, like termites, (bugs like wood) and facilitate rain water drainage.

#11 Use Non-Flammable Fencing
If you have wood fencing around your home, replace any three-foot sections that attach to the home with metal or other non-flammable fencing material. A metal gate or decorative fencing piece is stylish as well as fire-unfriendly.

#12 Cover Chimneys and Vents With Flame-Retardant Mesh
And it’s cheap to do. They cost just few dollars from hardware or home improvement stores.

#13 Check Your Siding
Fire-resistant or non-combustible siding like stucco or brick provides the best protection against fire. Make sure your siding, whatever type, is in good repair, because if the plywood or insulation are exposed, the home is more vulnerable to flames.

Some experts recommend spraying homes with fire retardants, which can range from a few hundred to a few thousand dollars, depending on the product, region, and size of the project. But some of the chemicals used to make flame-retardants have toxic properties. Although you might have less exposure to chemicals used on your home’s exterior than those inside, toxicity issues could still be a factor.

Most important, if a wildfire is on its way, evacuate. And have an evacuation plan worked out with your family before the worst happens.

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

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Why is my Grass Turning Brown?

Posted on July 30, 2021 by Debbie Prosser

Grass turns brown when roots can no longer grab nutrients or water from soil, or when soil doesn’t contain enough food or water.

Here are the typical culprits, and tips on how you can green up your grass again.

Drought/Heat
During periods of high heat and low water, many turf grasses go dormant. This is a normal condition; your grass will recover when the temperature drops and rain resumes.

To determine if drought is leading to brown grass, look for prematurely dropping tree leaves that are folded up like they’re praying for rain, says TV host Jason Cameron, a partner with TruGreen lawn care service.

To sustain a drought-dormant lawn, apply ½ inch of water every two or three weeks during the drought. To green it up again, apply 1 inch of water every 6 or 7 days — about 2 hours of sprinkler use. Or wait until temperatures drop and rain resumes, when it will turn green again on its own.

Sprinklers Misadjusted
If your lawn sports brown patches during heat waves, make sure your sprinklers are reaching all areas. Most sprinkler heads are easily adjusted with a small screwdriver. Low-to-the-ground pulsating (sometimes called impulse) sprinklers are easier to fine-tune than oscillating sprinklers.

Weeds
Common weeds can win the competition with your lawn for water and food. Controlling these weeds is tricky. Apply a pre-emergent herbicide in spring to prevent weed seeds from germinating. Or, hire a professional lawn care company that will customize an annual lawn maintenance and treatment plan.

Disease
Dozens of diseases and fungi can turn your lawn brown. If your grass is covered with white, black, or brown substances, then lawn disease is probably your problem and should be diagnosed and treated by a lawn specialist ($280-$700). Proper lawn care — sufficient water in early morning, regular mowing, good lawn aeration, and thatch management — will raise a healthy lawn more likely to resist lawn disease.

Cinch Bugs
These drought-loving bugs drain plant juices like tiny vampires. First your lawn will look wilted, then yellow, and eventually brown. Pull back a wilted patch and look for small red, orange, brown, or black bugs (1/32 to 1/5 inch depending on life stage) with white markings.

Thatch removal and consistent moisture are good preventative measures; insecticides are a last-ditch effort because many contain harsh chemicals that run off into the watershed and can harm beneficial insects.

Grubs
These beetle larvae feast on turf roots and mimic drought damage. Use a shovel to undercut a 1-by-1-foot square of turf, then peel back the patch and look for more than 10 grubs/square foot, which indicates a problem.

To control grubs, let your lawn dry out thoroughly before watering again. Or, plant low-maintenance turf grasses that are more grub-tolerant than Kentucky bluegrasses or perennial ryes. Also, you can try spreading milky spore powder (40 oz., $76, treats 10,000 sq. ft.), a natural organism that controls grubs.

Pet Waste
Round patches of dead grass indicate animals are peeing (urine contains acid) on your lawn. If you know a pet has a favorite spot, flush the area with water to dilute the acid.

If Necessary, Call in the Experts
Diagnosing the problem can be tricky, and your local extension agent or a lawn care company can help you determine exactly what ails your lawn.

Ounce of Prevention
Here are some prevention tips that will help your grass stay green, courtesy of Kevin Doerfler of Grass Seed USA.

-Aerate and inter-seed (add seed to existing grass) in fall when weather has cooled and rain is likely.
-Fertilize in spring and fall. Don’t fertilize when your grass already is stressed or during drought.
-Water in the early morning to combat fungal diseases. Water deeply to nourish roots.
-In summer, raise mowing height to 3 inches or above. The taller grass will shade roots and reduce water loss from evaporation.
-Perform a soil test to determine what amendments your lawn might need.

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

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