Real Estate and Housing http://www.wisebread.com/taxonomy/term/4810/all en-US 5 Questions to Ask Before Buying a Second Home in Retirement http://www.wisebread.com/5-questions-to-ask-before-buying-a-second-home-in-retirement <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-questions-to-ask-before-buying-a-second-home-in-retirement" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/couple_house_retirement_21246021.jpg" alt="Couple asking questions before buying second retirement home" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>It's nice image: You, your children, and your grandchildren gathering every summer at the lake house you bought after you retired from the workforce. Or maybe you instead picture these same children bringing their grandchildren for long weekends at the downtown city condo you purchased immediately after heading into retirement.</p> <p><a href="http://www.wisebread.com/how-to-retire-rich" target="_blank">Buying a second home after retirement</a> can be a reward for years of hard work. It might also be a good investment if you buy the right property; real estate, after all, has historically increased in value.</p> <p>But buying a second home in your retirement years can also be a financial misstep. These potential pitfalls are why you need to ask five key questions before you invest in that second home after you retire.</p> <h2>1. How Will You Pay for It?</h2> <p>Buying a second home is fairly simple if you plan to use cash from your savings. You still have to be careful, though, to make sure that such a big expenditure won't eventually make it more of a struggle to meet your other retirement goals. It might not be easy to take that long-awaited cruise if you've spent too much of your savings on a second home.</p> <p>If you need to finance the purchase of a second home with a mortgage, you might face an even bigger challenge. Under federal law, lenders can't reject you for a mortgage loan because of your age. They can, though, reject your application if they think you don't have enough income to afford your monthly mortgage payments.</p> <p>Lenders rely partly on your debt-to-income ratio when making mortgage decisions. Lenders want your total monthly debts, including your new mortgage payment, to equal no more than 43% of your gross monthly income. Income, of course, isn't just money you receive from a salary. You can also count Social Security payments, pension payments, monthly rent checks, money from legal settlements, and any other recurring source of monthly income. But if your income is so low that your debt-to-income ratio sails over that 43% mark, you'll struggle to get the mortgage you need to buy a second home.</p> <h2>2. Can You Afford It?</h2> <p>This, of course, is the big question: Even if you can buy a second home, can you afford the monthly expenses that go with it now that you can no longer rely on your regular paycheck?</p> <p>If you are financing the second home with a mortgage, can you afford to add those monthly payments to your existing expenses? And even if you are not taking out a mortgage, you'll have to face the normal expenses associated with owning a home: Furnaces go out, water heaters leak, and utility bills add up. If you buy a condo as a second home, are you okay with paying association dues each month?</p> <p>In short, can you afford the financial burden of owning that second home?</p> <h2>3. Who Will Maintain It?</h2> <p>Homes require regular maintenance. Someone has to mow the lawn, shovel the walks, sweep the floors, and replace fading paint jobs. Is this something you are willing to do, even as you get older? You might think your children will be happy to spend a few hours pulling weeds and mowing the lawn. But are they really okay with that?</p> <p>You might need to hire a service to handle the regular maintenance of your second home. That will ease your burden. But these companies don't come cheap. Can you afford the additional expense of hiring someone to maintain your second home?</p> <h2>4. How Often Will You Use It?</h2> <p>You might dream of spending months at your vacation home surrounded by visiting family members. But that dream might not be realistic. Your children and grandchildren have lives of their own. They might visit far less than you expect.</p> <p>And what about you? You might think now that you'd like to spend every summer at the lake house in that quaint, touristy town. But after three or four summers, you might get tired of that restaurant you've eaten at every visit or you might no longer have the appetite for all those fudge shops and antique stores. Yes, you might get bored with your second home, too.</p> <p>Instead of vacationing in the same spot, you might instead want to travel to new places each year. If so, a permanent second home might not be the best choice.</p> <h2>5. What Happens After You Die?</h2> <p>We don't like to think about dying. But when you buy a second home in your retirement, you need to consider it. What will happen to that second home after you pass on?</p> <p>You might want to leave it to one of your children. You'll have to decide, though, who gets it, without causing strife among them. What if none of your children want the home? They'll then have to go through the hassle of selling the property after you die. You'll need to determine before your death, just how the proceeds of that sale &mdash; if there are proceeds &mdash; will be divvied up.</p> <p><em>Have you considered buying a second home?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/5-questions-to-ask-before-buying-a-second-home-in-retirement">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-it-safe-to-re-finance-your-home-close-to-retirement">Is it Safe to Re-Finance Your Home Close to Retirement?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/frayed-relationships-damaged-credit-and-costly-additions-what-a-multi-generational-home-might-cost-y">Frayed Relationships, Damaged Credit, and Costly Additions — What a Multi-Generational Home Might Cost You</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-7-most-important-financial-moments-of-your-life">The 7 Most Important Financial Moments of Your Life</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-you-shouldnt-buy-a-house-yet">5 Reasons You Shouldn&#039;t Buy a House (Yet)</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-homebuying-questions-youre-embarrassed-to-ask">5 Homebuying Questions You&#039;re Embarrassed to Ask</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing Retirement condos family maintenance mortgages second homes vacation homes Fri, 24 Jun 2016 09:00:03 +0000 Dan Rafter 1737542 at http://www.wisebread.com 8 Moves to Make If You Need to Break Your Lease http://www.wisebread.com/8-moves-to-make-if-you-need-to-break-your-lease <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/8-moves-to-make-if-you-need-to-break-your-lease" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/man_thinking_house_59055710.jpg" alt="Man making moves to break his lease" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Most renters understand that a lease benefits them as much as it does landlords, since it protects both parties. However, if you need to break that lease, you could be on the receiving end of some tough penalties and legal actions. Don't panic yet, though &mdash; there are moves that could save you a lot of money&hellip; and your sanity.</p> <h2>1. Find New Tenants for the Landlord</h2> <p>The biggest issue landlords have with breaking a lease is the loss of income. The landlord has overhead, including a mortgage payment, HOA costs, water, and more, and they all have to be covered even when the property is empty. This is why there are penalties for breaking a lease &mdash; to cover the landlord against loss.</p> <p>However, if you are proactive and find good tenants to replace you, it's very possible the landlord will waive the fees and let you break the lease. After all, you have brought in new tenants, saving the landlord time and effort, and in most cases, extending the time the property will be filled. (If your lease expires in July, but you bring in someone to rent from March-February of the following year, you've done the landlord a favor).</p> <h2>2. Plead Your Extenuating Circumstances</h2> <p>Landlords are people, too. If you're renting from a big property management firm, you won't have much luck. But if it's an individual, arrange a time to sit and chat, and explain the reasons why you have to break the lease. Be open, be honest, and see what happens. If you have to break the lease to move back home with an ailing parent or relative, the landlord could be very sympathetic, and may do something for you (cutting the early termination fee in half, or waiving it completely). But, don't lie. Making up some bleeding heart story could backfire, and <a href="http://www.wisebread.com/10-questions-landlords-cant-ask" target="_blank">you don't want an angry landlord</a> as an enemy, especially when they have the law on their side.</p> <h2>3. Look for a Contract Breach</h2> <p>If you have to break the lease, you may well be within your rights to do so without any kind of termination fee &mdash; <em>if</em> the contract is, in fact, not being adhered to. Remember, the contract is for your protection as well as the landlord's, and the property should be safe and well-maintained. If you have been living with a broken refrigerator, a moldy bathroom, or any other type of problem that makes the property tough to live in, you can use it to your advantage.</p> <p>However, you cannot just ignore these issues for months and then decide to break the contract. You will need to provide evidence that you asked the landlord to address the issues. Also, take pictures, and keep copies of all correspondence. If you can show your requests for help fell on deaf ears, you will have a great case to break the lease without a fee.</p> <h2>4. Negotiate Payoff Terms for the Penalties</h2> <p>Early termination fees can be very scary. When you see a $1,500 lump sum, it can make you think twice about even considering it. However, landlords can be very flexible if they know they are going to get the money in a set amount of time. Consider asking for an installment payment plan for any early termination fees.</p> <h2>5. Use Your Security Deposit as a Bargaining Chip</h2> <p>You will have put down a substantial security deposit when you signed the lease. Usually, it's around one month's rent, and this can be just enough to cover the costs of the landlord while they find a new tenant. If the property is in a highly sought after location, it will not be empty for long, and that security deposit will more than cover any costs the landlord has. It's much easier for them to simply keep that deposit and avoid a bunch of paperwork, rather than trying to take you to court for fees.</p> <h2>6. Find a Sublet</h2> <p>Ready to become a landlord yourself for a while? Well, try subletting. Now, you may find that the contract forbids you to sublet the property, so you may have to talk to the landlord (or do it without saying anything, and hope for the best). As a general rule, landlords don't really care where the money comes from, as long as the property is well maintained and the tenants cause no trouble. And remember, if you sublet to someone who wrecks the place, that's all on you. Your name is on the lease, so the landlord is going to be reimbursed, either way.</p> <h2>7. Can You Blame the Neighbors or Surroundings?</h2> <p>Do the neighbors upstairs have parties until 4 a.m. every weekend (or worse, every day)? Do the neighbors harass you, or make life hell for you in general? Is the neighborhood itself in serious decline, and no longer a safe place to live? These are all conditions that you may be able to use to break the lease without a termination fee.</p> <p>Once again, you would have to prove that you asked the landlord to deal with the situation, and that nothing happened. But if you can prove the property became unlivable, you can argue you were &quot;<a href="http://www.brickunderground.com/blog/2011/07/ask_an_expert_breaking_a_lease_over_neighbor_noise">constructively evicted from your property</a>.&quot; This is something that can go to court, so you need to be really buttoned-up, and will most likely require legal assistance.</p> <h2>Haggle Over the Early Termination Fee</h2> <p>Landlords would rather have some money than none at all. If you are going to have to pay $2,000 to break the lease, but can only afford $1,000, talk to the landlord about a lower penalty. This is easier to do with an individual than a property management company, as the latter has the backing of corporate funds and on-staff legal counsel. But&hellip; it's always worth a try.</p> <p><em>Have you ever broken a lease? How'd you get out of it?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/paul-michael">Paul Michael</a> of <a href="http://www.wisebread.com/8-moves-to-make-if-you-need-to-break-your-lease">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-questions-landlords-cant-ask">10 Questions Landlords Can&#039;t Ask</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-11-best-websites-for-renting-your-extra-space">The 11 Best Websites for Renting Your Extra Space</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-ways-to-rent-an-apartment-with-bad-credit">7 Ways to Rent An Apartment With Bad Credit</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-smart-ways-to-get-your-apartment-deposit-back">7 Smart Ways to Get Your Apartment Deposit Back</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-you-definitely-need-renters-insurance">5 Reasons You Definitely Need Renters&#039; Insurance</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing apartments breaking lease contracts landlords lease rental agreement renting sublet Wed, 22 Jun 2016 09:30:24 +0000 Paul Michael 1736373 at http://www.wisebread.com 5 Reasons You Shouldn't Buy a House (Yet) http://www.wisebread.com/5-reasons-you-shouldnt-buy-a-house-yet <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-reasons-you-shouldnt-buy-a-house-yet" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_new_house_62322290.jpg" alt="Woman learning reasons she shouldn&#039;t buy a house yet" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>You hate sending that rent check to your landlord every month. The neighbors living above you have a newborn baby that cries all night long. And you dream of planting your own vegetable garden.</p> <p>In short, you're tired of renting and you want to buy your first home. But wanting to buy a home and being ready to do so are two different things. Are you financially ready for the burden of a monthly mortgage payment?</p> <p>Here are five signs that you're not ready to buy a house just yet. But don't fret; even if you are struggling with these financial issues, you can still become a homeowner. You'll just need a bit of patience and improved financial skills.</p> <h2>Sign 1: You Have No Savings</h2> <p>Buying a home is expensive. You'll need money for a down payment. For most mortgage loans, you'll need at least 5% of the home's purchase price. For a home costing $200,000, that comes out to $10,000. If you are buying a home insured by the Federal Housing Administration, better known as an FHA loan, you'll need a down payment of 3.5% of your home's final purchase price, depending on your credit score. For a $200,000 home, that still comes out to a down payment of $7,000.</p> <p>Then there are closing costs, the fees that mortgage lenders, title insurers, and others charge you to originate your mortgage loan. Real estate website Zillow says that these costs can run from 2% to 5% of your total mortgage loan. If you are borrowing $180,000, then your closing costs can run from $3,600 to $9,000.</p> <p>It's true that you can get help with some of these costs. You can use gift money from relatives, for example, to pay for all or part of your down payment. You might be able to convince a home's seller to pay for all or part of the closing costs. But if you don't have any savings built up, lenders might hesitate to lend you mortgage money. They want to make sure that you have reserve funds on hand to cover your mortgage payment for at least two to three months if you should suddenly run into a financial crisis such as a job loss.</p> <h3>What to Do</h3> <p>It's best to start searching for a home only <em>after </em>you've saved enough money to cover a down payment and your estimated closing costs. Most lenders will also want to see enough money in your savings after you've paid closing costs and your down payment to cover at least two months of mortgage payments.</p> <h2>Sign 2: Your Credit Score Is Bad</h2> <p>Your credit score is a key number when you're applying for a mortgage. Lenders pass out their lowest interest rates to borrowers who have FICO credit scores of 740 or higher. But the lower your score, the higher your interest rate &mdash; and your monthly mortgage payment &mdash; will be. If your score is too low, say under 640, you'll struggle to qualify for a loan at all.</p> <h3>What to Do</h3> <p>First, order at least one of your three credit reports from AnnualCreditReport.com. You are entitled to one free copy of each of your three credit reports &mdash; maintained by the national credit bureaus of Experian, Equifax, and TransUnion &mdash; once every year. Once you get your report, read it carefully. It will list how much you owe on your credit cards and how much you owe on student loans and car loans. It will also list whether you have any late or missed payments during the last seven years. Those late or missed payments will send your credit score tumbling.</p> <p>Next, order your FICO credit score. You can do this from the credit bureaus, too, but you'll have to pay about $15 to do so. If your score is low, and there are negative marks on your credit report, it's time to start a new history of paying all your bills on time. You also need to pay down as much of your credit card debt as possible. Both of these actions will steadily increase your credit score, though it could take months or even more than a year before your score recovers enough to make you a good candidate for a mortgage loan.</p> <p>Be patient and wait to apply for that mortgage until your FICO score is over 700.</p> <h2>Sign 3: You Have a Mountain of Credit Card Debt</h2> <p>Your debt-to-income ratio is another key number when it comes to buying a home. Lenders want your total monthly debts, including your estimated new mortgage payment, to equal no more than 43% of your gross monthly income. If your debt-to-income ratio is too high, you'll struggle to earn approval for a mortgage. (See also: <a href="http://www.wisebread.com/5-day-debt-reduction-plan-stop-waiting-for-tomorrow?utm_source=wisebread&amp;utm_medium=seealso&amp;utm_campaign=article">5 Day Debt Reduction Plan</a>)</p> <p>For many potential homebuyers, large amounts of credit card debt are what shoot that debt-to-income levels past 43%.</p> <h3>What to Do</h3> <p>Pay off that credit card debt. Always make more than your minimum monthly required payment. And wait until you've substantially reduced that debt before you add a monthly mortgage payment to your financial responsibilities.</p> <p>See also: <a href="http://www.wisebread.com/fastest-way-to-pay-off-10000-in-credit-card-debt?utm_source=wisebread&amp;utm_medium=seealso2&amp;utm_campaign=article">This Is The Fastest Way to Pay Off Your Credit Card Debt</a></p> <h2>Sign 4: You Routinely Miss Your Monthly Payments</h2> <p>Maybe you have more than enough money each month to pay all your bills on time &mdash; you just routinely forget to pay them. Making late payments, or missing payments completely, is a sure sign that you're not ready for the financial responsibility of owning a home.</p> <p>If you miss a mortgage payment by more than 30 days, your credit score will fall by 100 points or more. If you miss enough, you could lose your home to foreclosure.</p> <h3>What to Do</h3> <p>Learn better financial habits before you apply for a mortgage. Set up reminders on your phone or computer alerting you when bills are due. Or pay those bills as soon as they arrive to make sure you don't forget them. It might makes sense to set up automatic payments through your bank. But don't apply for a mortgage until you've broken the habit of regularly missing your monthly payment due dates.</p> <h2>Sign 5: You Don't Have a Stable Job</h2> <p>You'll need a steady, reliable stream of income if you use a mortgage to finance the purchase of a home. If you're worried that you'll lose your job, or if your income is sky-high one month thanks to overtime and then low the next, you might not be ready to buy a home.</p> <p>Your monthly mortgage payment will become the biggest financial responsibility you have. What happens if you lose your job? What happens if your company goes through a dry spell in which they reduce your income for several months? Would you still be able to afford that monthly payment?</p> <h3>What to Do</h3> <p>Find a job that is reliable and that pays you a stable income each month. Don't take the risk that everything will work out. You don't want missed mortgage payments on your credit reports. And if your job is unstable? You'll greatly increase the risk of these black marks.</p> <p><em>Are you ready to buy a home? What steps are you taking to make it happen?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/5-reasons-you-shouldnt-buy-a-house-yet">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/everything-a-first-time-home-buyer-needs-to-buy-a-house">Everything a First-Time Home Buyer Needs to Buy a House</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/ask-yourself-these-5-questions-before-buying-a-home">Ask Yourself These 5 Questions Before Buying a Home</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-only-5-rules-of-home-buying-you-need-to-know">The Only 5 Rules of Home Buying You Need to Know</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-reasons-why-youre-too-old-or-too-young-for-a-mortgage-loan">4 Reasons Why You&#039;re Too Old — Or Too Young — For a Mortgage Loan</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/whats-faster-for-mortgage-payoff-100-month-extra-or-1-payment-year-extra">What&#039;s Faster for Mortgage Payoff: $100/Month Extra or 1 Payment/Year Extra?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing credit score debt debt to income ratio down payments fha loans homeowners mortgages new home Fri, 17 Jun 2016 10:00:11 +0000 Dan Rafter 1732054 at http://www.wisebread.com Moving? Don't Skimp on These Critical Expenses http://www.wisebread.com/moving-dont-skimp-on-these-critical-expenses <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/moving-dont-skimp-on-these-critical-expenses" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_empty_box_87950015.jpg" alt="Woman learning not to skimp on moving expenses" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Moving can be an expensive, daunting experience. Worst of all, many people spend unnecessary money on moving supplies and items they simply don't need. On the other hand, you don't want to be dealing with the loss of property or issues after the move because you tried to save a few bucks.</p> <p>The trick is to keep the purchases light, while getting everything you need to safely transport your items to your new destination in one piece. That's why we're here to help you determine what you should, and what you definitely <em>shouldn't</em> skimp on.</p> <h2>Professional Movers</h2> <p>Hiring professional movers may be one of the best things you do for your move. While some people like to rely on themselves, friends, and family members to load and unload the moving truck, this can be a huge waste of time and energy that could be better spent settling into your new place. This can also be a very stressful event that causes friction with friends and family members, so just leave the dirty work to the professionals.</p> <p>Quality professional movers will carefully load your items into the truck, and should adequately protect them so that you can move with the peace of mind that your items are going to make it to your new destination in one piece. In fact, most movers will arrive with moving blankets and padding to further protect any fragile items.</p> <h3>Contact at Least Three Moving Companies</h3> <p>While you will need movers, you want to be careful about who you entrust with all of your possessions. Not all movers are created equal (which you hopefully won't find out the hard way). Carefully research movers to ensure that you're getting what you're expecting. Ask neighbors for recommendations, check Yelp and the Better Business Bureau for customer reviews and complaints, and do your due diligence to find the best movers at the best value in your area.</p> <p>It's usually a good idea to contact at least three reputable moving companies so that you can compare their services and costs. You can also ask them to do an in-home estimate. This will ensure that you get a more accurate quote and it will allow you to gauge whether it's really a company you want to be working with. Make sure to carefully read the estimate or contract to verify what is included with the moving services before signing anything.</p> <h3>Additional Services Offered by Moving Companies</h3> <p>Some moving companies will also help you pack, but this is one expense that you may want to skip. If you are hard-pressed for time, or your move is quickly approaching, then it may be worth the investment to have your moving company help with the packing. Otherwise, roll up your sleeves and get to work, because it can save you big money in the end.</p> <p>Some moving companies will also offer free storage for up to 30 days, which can be very valuable to you if your new place isn't ready yet. If you think you'll need storage, it may be wise to look for a moving company that offers it for free, rather than hiring a separate moving and storage company, which will likely cost you more money and a bigger headache in the end.</p> <h2>Moving Insurance</h2> <p>Accidents happen, which is why you should be prepared for them. Moving insurance is an absolute necessity. It will provide you with peace of mind, and in the event that the unthinkable happens, you can receive full or partial reimbursement for your damaged or lost items. Just as you wouldn't skimp on health or auto insurance, you shouldn't skimp on moving insurance.</p> <p>Most moving companies will offer some form of general insurance, but this generally tends to be about $0.60 per pound. This means that if you have a 48-inch television that only weighs 25 pounds, if the movers should drop it and you have not paid for additional moving insurance, you would only be entitled to a reimbursement of $15.</p> <p>As another example, the typical two-bedroom home usually weighs in somewhere around 4,500 pounds. Say the truck is completely destroyed (along with all of your property) &mdash; you would only be reimbursed $2,700. Your lifetime of saving and carefully choosing what to spend your money on is only worth $2,700 to the moving company. Unless you think you can refurnish an entire two-bedroom home for $2,700 (along with all of your clothing and personal possessions), you can clearly see the need for supplemental moving insurance.</p> <p>On the plus side, moving insurance is usually very affordable, particularly if you choose a higher deductible. The price will vary depending on how much insurance you need and the declared value of the items you want to insure. In most cases, you need to arrange moving insurance at least 48 hours before your move, so this isn't something you can procrastinate on.</p> <h2>Packing Supplies</h2> <p>More important than the quantity of packing supplies is the <em>quality</em>. The last thing you want to do is save a couple of bucks by buying cheap packing tape only to find that the heavy boxes split open on moving day. Don't skimp on tape or packing material for antiques and particularly valuable items.</p> <p>When it comes to glass, porcelain, or ceramic, packing paper or newspaper should work fine. You can also save some money by placing one foam dinner plate in between two glass plates. This will protect the plates during the move and make it easier for you to unpack.</p> <p>You'll also need things like a marking pen, cushioning material, scissors or a utility knife, and a tape gun, but you shouldn't have to spend a lot on these items. You also shouldn't need to spend much on boxes, if anything at all. You can typically find free boxes at your local grocery store or recycling center. Just make sure the boxes are in good condition and can safely transport your heavy items. The last thing you want is to pack your valuables in an old cardboard box that rips open on moving day or crumbles under the weight of other boxes. The cost to replace these items will likely be much higher than what you would've spent on quality boxes.</p> <h2>Don't Forget Your Tax Deductions</h2> <p>On the plus side, if your move is related to work, you can write off part of the move on your taxes. That means the movers, moving truck and supplies, and other must-have essentials might be deductible at the end of the year. Just make sure your move meets the <a href="https://www.irs.gov/taxtopics/tc455.html">IRS's time and distance test requirements</a> in order to safely deduct any reasonable moving expenses.</p> <p><em>Do you know of any other overlooked or unnecessary moving costs?</em> <em>Please share your thoughts in the comments!</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/andrea-cannon">Andrea Cannon</a> of <a href="http://www.wisebread.com/moving-dont-skimp-on-these-critical-expenses">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-save-100s-on-your-next-move">How to Save $100s on Your Next Move</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-reasons-you-should-always-hire-a-moving-company">6 Reasons You Should Always Hire a Moving Company</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-hidden-housing-costs-new-homeowners-dont-expect">10 Hidden Housing Costs New Homeowners Don&#039;t Expect</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-forget-to-budget-for-these-unexpected-moving-expenses">Don&#039;t Forget to Budget for These Unexpected Moving Expenses</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-places-it-pays-to-relocate-to">6 Places It Pays to Relocate To</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Frugal Living Real Estate and Housing expenses insurance movers moving new house packing relocation tax deductions Fri, 17 Jun 2016 09:30:28 +0000 Andrea Cannon 1732051 at http://www.wisebread.com 5 Homebuying Questions You're Embarrassed to Ask http://www.wisebread.com/5-homebuying-questions-youre-embarrassed-to-ask <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-homebuying-questions-youre-embarrassed-to-ask" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_realtor_house_91129695.jpg" alt="Couple asking homebuying questions they&#039;re too embarrassed to ask" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>You're ready to buy your first house. But you have questions. Lots of them. And some you think might be too embarrassing &mdash; too simple &mdash; to even ask out loud.</p> <p>Here's the truth: Buying a home is a complicated process. It's normal to have questions. And you should never be embarrassed to ask any of them. Here are answers to five such common questions. (See also: <a href="http://www.wisebread.com/the-only-5-rules-of-home-buying-you-need-to-know?ref=seealso">The Only 5 Rules of Home Buying You Need to Know</a>)</p> <h2>1. How Much Will My Real Estate Agent Charge Me?</h2> <p>The short answer: nothing.</p> <p>It's true. When you work with a real estate agent to <em>buy </em>a home, you won't pay a cent to that realtor. Your real estate agent gets paid by the <em>seller</em> of the home that you buy. When the home sale closes, your real estate agent is paid a commission from the proceeds.</p> <p>Typically, the agent representing the home's seller charges a commission of 6% of the home's sale. If a home sells for $200,000, the seller's agent receives $12,000. That agent then typically splits the commission 50/50 with your agent. Your agent in this example would receive $6,000 for helping you buy a home while the seller's agent would also receive $6,000.</p> <p>But none of that commission money will come out of your pocket.</p> <h2>2. What Is a Buyer's Agent?</h2> <p>An exclusive buyer's agent is a real estate agent who only represents buyers. They are different from dual agents, who both represent buyers and work with sellers. An exclusive buyer's agent never takes on listings from sellers.</p> <p>If you work with a dual agent, that agent will show you all the for-sale homes that meet your criteria, and will still work with you to negotiate a lower sales price. But this agent <em>might </em>show you a home he or she has as a listing, too. This can be tricky. Is your dual agent going to negotiate hard on the sales price if that agent is also representing the person selling the home?</p> <h2>3. What Is Pre-Approval and Why Does It Matter?</h2> <p>Your real estate agent might ask you to get pre-approved for a mortgage loan from a lender. During the pre-approval process, your lender will run your credit and ask for copies of documents that prove your income, such as your last two paycheck stubs, last two months of bank account statements, and last two W2s.</p> <p>Once a lender has this information, it can calculate how much of a mortgage you can afford. The lender will then give you a pre-approval letter &mdash; that lasts a certain number of days, such as 30 or 60 &mdash; stating that it has approved you for a mortgage loan of a certain amount.</p> <p>Getting pre-approved is important because it tells you how much home you can afford. It also makes you a more attractive buyer. When sellers receive multiple bids for their homes, they're more likely to choose a buyer who is pre-approved. Such buyers are more likely to be able to actually close the home sale.</p> <h2>4. What Is Earnest Money?</h2> <p>Earnest money is a deposit that you make after you and a seller sign a contract. It shows the seller that you are serious about purchasing the home.</p> <p>After you and the seller agree on a sales price and each of you signs the sales contract, you'll deposit a certain percentage of the home's final sales price into an escrow account. The title company that handles your mortgage closing will usually manage the account. When the final mortgage documents are signed and the home sale officially closes, your earnest money is removed from the escrow account and used to cover part of your closing costs.</p> <p>How much earnest money the sellers request varies. Some sellers will require 1% of the home's final purchase price. Others will require just a few hundred dollars.</p> <p>Be careful with earnest money. If you back out of the sale because you can't come up with the mortgage dollars you need to finance the home, the contract might state that you lose your earnest money deposit. However, if you back out of the sale because a home inspection turns up serious problems with the home, the seller will usually return your earnest money deposit.</p> <h2>5. Do I Really Need a Home Inspection?</h2> <p>Yes. After you sign a sales contract for a home, you need to schedule a home inspection of the property. An inspector will tour the home and search for serious problems. Usually, the homebuyer attends the inspection, too.</p> <p>If the inspection turns up serious problems, you have options. You can ask the seller to repair the problems before the sale closes. You can request that the seller lower the agreed-upon asking price to free up money that you can use to fix the repairs yourself.</p> <p>If the problems are too severe, you can also back out of the sale. Your agent and the seller's agent will then negotiate what happens to your earnest money deposit. If the problems with a home truly are serious, and expensive, in most cases, you will receive a refund of your earnest money deposit.</p> <p><em>Any fundamental questions we've overlooked?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/5-homebuying-questions-youre-embarrassed-to-ask">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-4"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-sell-your-house-in-24-hours">How to Sell Your House in 24 Hours</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-you-shouldnt-buy-a-house-yet">5 Reasons You Shouldn&#039;t Buy a House (Yet)</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-only-5-rules-of-home-buying-you-need-to-know">The Only 5 Rules of Home Buying You Need to Know</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-pros-and-cons-of-paying-cash-for-a-house">The Pros and Cons of Paying Cash for a House</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/six-options-if-youre-underwater-on-your-mortgage">6 Options if You&#039;re Underwater on Your Mortgage</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing buying a home earnest money escrow home inspection mortgages pre-approval questions selling a home Fri, 10 Jun 2016 09:00:05 +0000 Dan Rafter 1727884 at http://www.wisebread.com 9 Things You Need to Know About a Home Appraisal http://www.wisebread.com/9-things-you-need-to-know-about-a-home-appraisal <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/9-things-you-need-to-know-about-a-home-appraisal" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/couple_home_appraisal_63336927.jpg" alt="Couple learning about home appraisals" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The first time you purchase a home, you may worry whether you are paying too much. Fortunately, assuming you are applying for a mortgage, there is a value check built into the purchase process: the home appraisal.</p> <p>Basically, the bank will send an expert to evaluate the home you want in the context of nearby recent sales, and tell you whether it's worth the contract price. If the appraiser says it's not, the bank won't finance your purchase at that price. Either the sale is off, or you'll have to renegotiate the price or add more cash to the deal.</p> <p>Appraisal day can cause anxiety for both buyers and sellers, but understanding these key things about the process can make it less nerve-wracking:</p> <h2>1. Appraisers Aren't Making This Up as They Go</h2> <p>Appraisers are required to be licensed or certified, and they generally go through a standard evaluation process, filling in spaces on a <a href="http://www.investopedia.com/articles/pf/12/home-appraisals.asp">template from Fannie Mae</a>. Aspects of the home that affect the valuation include: square footage, number of bathrooms, number of bedrooms, and needed repairs. (See also: <a href="http://www.wisebread.com/5-appraisal-facts-that-could-save-you-big-money?ref=seealso" target="_blank">5 Appraisal Facts That Could Save You Big Money</a>)</p> <h2>2. Your Home Isn't the Only One the Appraiser Looks At</h2> <p>Besides the condition and features of your home, the other important factor for valuation is the selling price of other homes in the area. The appraiser will search recent sales for homes as similar to yours as possible, and use their selling prices to estimate an appropriate selling price for yours.</p> <h2>3. The Buyer Pays for the Appraisal</h2> <p>Although the appraisal is really for the lender's benefit, and the lender orders it, the lender will typically send the appraisal bill, usually several hundred dollars, to the buyer.</p> <h2>4. The Appraisal Doesn't Substitute for a Home Inspection</h2> <p>An appraiser is looking over your house to <a href="http://homeguides.sfgate.com/appraiser-say-house-not-good-condition-62802.html">gauge its general condition</a> on a scale of 1 to 6, with the bottom half of the scale indicating that serious repairs are needed. An inspector will meticulously test every system of your home, making sure the furnace works, the water pressure is good, etc. Just because an appraiser said the house is in good condition does not mean you can skip the inspection report.</p> <h2>5. Appraisals Aren't Just for Home Sales</h2> <p>Any time you take a loan on a property, the lender will likely need an appraisal. So you may have to pay for one when you refinance your mortgage or take out a home equity line of credit.</p> <h2>6. Sometimes the Appraiser Doesn't Need to Enter the Home</h2> <p>Although less common than they were before the housing crash, <a href="http://www.forsytheappraisals.com/2015/august/292-what-do-you-get-with-a-drive-by-appraisal">drive-by appraisals</a>, where the appraiser evaluates the house by looking at the exterior and using comparable recent sales, still happen. If you had a recent appraisal, and you are refinancing, the bank might be okay with a drive-by, which will probably cost you less.</p> <h2>7. You Don't Have to Be Present for the Appraisal</h2> <p>Buyers typically don't attend a home appraisal, but it's fine for the seller to be in the home during the appraisal. In fact, it could be helpful because the appraiser may have questions for the homeowner. It might be useful for the agent to be present as well, and it's often recommended that owners provide written information, such as a list of improvements and repairs they've done.</p> <h2>8. You Are Entitled to a Copy of the Report &mdash; Read It Carefully</h2> <p>The Consumer Financial Protection Bureau requires lenders to provide homeowners with a copy of the appraisal report at no additional cost. When you get it, check it carefully for errors, especially if the appraisal came in lower than you expected. You can appeal if the appraiser missed something important, or if you feel the comparison sales they chose were inappropriate &mdash; for instance, if one of the comparisons was in terrible condition or much smaller than your house.</p> <h2>9. You Can Hire an Appraiser Before You Sell Your Home</h2> <p>There are two reasons you might consider hiring your own appraiser: You want to know how much your house is worth before listing it, or you are deciding whether to undertake repairs or improvements before listing it.</p> <p>Usually, it's the agent's job to help you set a selling price. If you doubt your agent's estimate, or if you're getting conflicting estimates from different agents, you could hire an appraiser to settle it. However, there are cons to this practice as well as pros. Don't expect the buyer's lender to use your pre-appraisal &mdash; they'll still want their own.</p> <p>As far as assessing the value upgrades might add to your home, an appraiser can be really valuable in saving you from investing dollars in the property that you won't get back. However, a knowledgeable real estate agent should have ideas about this as well.</p> <p><em>Have you ever been dissatisfied with an appraiser's report?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/carrie-kirby">Carrie Kirby</a> of <a href="http://www.wisebread.com/9-things-you-need-to-know-about-a-home-appraisal">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-5"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-reasons-your-home-isnt-selling">7 Reasons Your Home Isn&#039;t Selling</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-only-5-rules-you-need-to-know-about-investing-in-real-estate">The Only 5 Rules You Need to Know About Investing in Real Estate</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/real-estate-appraisals-ten-things-most-people-just-dont-understand-about-them">Real Estate Appraisals - Ten things most people just don&#039;t understand about them</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/ask-yourself-these-5-questions-before-buying-a-home">Ask Yourself These 5 Questions Before Buying a Home</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-let-these-6-home-d-cor-flaws-ruin-your-house-hunt">Don&#039;t Let These 6 Home Décor Flaws Ruin Your House Hunt</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing appraisal home value housing market new homeowner selling a house Tue, 07 Jun 2016 09:00:07 +0000 Carrie Kirby 1725697 at http://www.wisebread.com The Only 5 Rules You Need to Know About Investing in Real Estate http://www.wisebread.com/the-only-5-rules-you-need-to-know-about-investing-in-real-estate <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-only-5-rules-you-need-to-know-about-investing-in-real-estate" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/000074853063.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The numbers are impressive: The median existing home price for homes across the United States stood at $232,500 in April, according to the National Association of Realtors. That's up 6.3% from the same month one year earlier, and marks the 50th consecutive month in which median housing prices have increased from one year to the next.</p> <p>This steady rate of appreciation might inspire you to invest in residential real estate. After all, the performance of the housing market during the last four years has been far steadier than that of the stock market. But be careful: Sure, investing in real estate can be profitable &mdash; but it can also be risky. Investors who don't do their homework before sinking their dollars into homes could lose a bundle of money.</p> <p>Here are five rules you must know before <a href="http://www.wisebread.com/real-estate-investing-is-cheaper-and-easier-than-you-think" target="_blank">investing in real estate</a>.</p> <h2>1. Don't Let Your Emotions Betray You</h2> <p>Jamal Asskoumi, owner of the online real estate agency CastleSmart, says that too many inexperienced investors make the mistake of falling in love with a property for the way it looks. They then invest in it without running the numbers to make sure that the home has real potential to increase in value enough to make it a sound investment.</p> <p>Falling in love with a property can also cause investors to spend too much on it upfront, making it nearly impossible for them to make a profit after their purchase.</p> <p>&quot;Unlike stocks that are numbers on a screen, property must be liked and appreciated before it can be invested in, and this is the downfall of many investors,&quot; Asskoumi said. &quot;When visiting a property, investors sometimes become attached and feel as though they have to have it, regardless of the price. They end up paying more than what is necessary and lose on the investment.&quot;</p> <h2>2. Have Enough Money to Cover Both Known and Unknown Losses</h2> <p>Investing in real estate isn't cheap. You are buying a home, after all. But the real trouble spot for investors are the unexpected costs: If you rent out your investment, you never know what damage your tenants might cause. Fixing that damage could cost thousands of dollars.</p> <p>You also have to be prepared for possible losses. Housing values can go down as well as up. You need the financial cushion to handle these fluctuations, said Rocky Lalvani, a financial coach and founder of the Richer Soul financial blog.</p> <p>You also need the money to cover possible monthly losses until your property does appreciate enough in value for you to sell it and earn a big profit. Maybe your mortgage on the property you bought is $2,000 a month but you can only rent the home for $1,800 a month. You'll essentially be losing $200 a month while you wait for your investment to appreciate.</p> <p>&quot;Be prepared for losses; it's a cost of business,&quot; Lalvani said. &quot;Real estate may lose money in the short term while your asset is building over the long term.&quot;</p> <h2>3. Don't Rent to Just Anyone</h2> <p>Finding good tenants is one of the biggest challenges in investing in real estate. The wrong tenants could damage your property, stop paying their monthly rent, and force you to evict them, a process that is long and costly.</p> <p>That's why it's so important to do your research before renting out your home. Run the credit of potential tenants to determine if they've struggled to pay their bills before. Run criminal background checks, too, on potential tenants.</p> <p>Above all, never simply buy into the promises that potential tenants make to you.</p> <p>&quot;Tenants will literally lie about anything and everything,&quot; said Eric Bowlin, a real estate investor and founder of the real estate investing blog EricBowlin.com. &quot;Assume everyone has no job, no income, and a long eviction record, until otherwise proven.&quot;</p> <h2>4. Invest in the Right Neighborhood</h2> <p>You want to invest in an area in which homes are most likely to increase in value. Unfortunately, there is no guarantee that any home, even if located in a desirable neighborhood, will be worth more 10 years from now than it is today.</p> <p>But investing in the right neighborhood can at least increase the odds.</p> <p>Study what homes are selling for in any neighborhood in which you want to invest. Study, too, the average monthly rents that homes and apartments in a neighborhood fetch.</p> <p>A neighborhood that is dotted with new restaurants and shops might be a good investment. So might be one that is gaining the reputation as being an up-and-coming area. Be careful, though: It's easy to spend too much upfront in these hotter neighborhoods.</p> <p>Paul Ullman, founder and chief investment officer of Asset Based Lending in Hoboken, New Jersey, says that the key is to look at the strength of nearby schools and to target areas that have positive job growth. It helps, too, to know the neighborhood in which you are going to invest.</p> <p>&quot;Ideally, invest close to home, at least initially,&quot; Ullman said.</p> <h2>5. Know Your Limits</h2> <p>Before investing in real estate, be honest about what you can and can't do. If you're not particularly handy, you might not be able to repair that leaking dishwasher on your own, for instance, and might need a plumber to resolve the problem. That will add to the costs of your real estate investment.</p> <p>You might also want to avoid 2:00 a.m. calls from tenants complaining that the heat in their apartment isn't working. To avoid these calls, you can hire a professional property management company to take over the daily operations of your real estate investment. Hiring such a company, though, costs money, and will eat into your profits.</p> <p>&quot;I always tell people who are interested in getting into investment real estate to consider how comfortable they are with doing any kind of repairs or construction to a house or rental property,&quot; said Todd Barton with the Atlanta office of Renters Warehouse. &quot;You'll have to budget in the costs of contractors or professional property managers. Be honest with yourself upfront so that you don't get into a situation where you are overwhelmed with projects and mounting debts.&quot;</p> <p><em>Have you taken the plunge and invested in real estate? What other rules should new investors stick to?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/the-only-5-rules-you-need-to-know-about-investing-in-real-estate">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-5"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/20-tips-for-getting-your-security-deposit-back">20 Tips for Getting Your Security Deposit Back</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-sell-your-home-to-pay-down-debt">Should You Sell Your Home to Pay Down Debt?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-worry-about-missing-the-bottom-in-houses">Don&#039;t worry about missing the bottom in houses</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/so-you-want-to-be-a-landlord-part-i">So You Want to be a Landlord? Part I</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-moves-to-make-if-you-need-to-break-your-lease">8 Moves to Make If You Need to Break Your Lease</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment Real Estate and Housing appreciation housing market landlord neighborhoods property management renting residential real estate risks tenants Thu, 26 May 2016 09:30:22 +0000 Dan Rafter 1717920 at http://www.wisebread.com 10 Questions Landlords Can't Ask http://www.wisebread.com/10-questions-landlords-cant-ask <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/10-questions-landlords-cant-ask" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/man_rental_sign_000024945777.jpg" alt="Learning which questions landlords cannot ask" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The rental market is tough these days, especially in big cities. You have to scan the classifieds, jump on opportunities, and be ready to say yes at a moment's notice. So the last thing you need is for some landlord to refuse you a lease because of questions he or she is actually not allowed to ask. Here are 10 of those questions. Getting asked any of them should give you pause.</p> <h2>1. Where Were You Born?</h2> <p>It may be an innocent enough question, especially if you have an accent and the landlord picks up on it. But it's actually against the <a href="http://www.fairhousingresources.com/Fair-Housing-Act-Full-Text.html">Fair Housing Act</a> to ask questions regarding someone's nationality. A landlord cannot ask about your parents' nationality or upbringing either, or your spouse's. This is all information that should have no bearing on your application, or your suitability as a tenant. If a landlord does ask, <a href="http://www.american-apartment-owners-association.org/property-management/tenant-screening/rental-application-question-illegal/">the penalties can be severe</a>.</p> <h2>2. Have You Ever Been Arrested for Anything?</h2> <p>If a landlord is asking this, they're probably trying to protect themselves from someone who could be trouble. But, landlords are simply not allowed to know about your arrest record. They are entitled to know if you were convicted of a crime, and that will come up on a standard background check. However, since innocent people can be arrested and then set free, <a href="http://www.wisebread.com/the-9-most-important-lessons-i-learned-about-money-when-i-became-a-landlord" target="_blank">landlords aren't entitled</a> to arrest records.</p> <h2>3. Are You Straight, Gay, or Bisexual?</h2> <p>This has absolutely no place in the conversation, and cannot be asked by the landlord. It's a direct violation of the Fair Housing Act, and by doing so, the landlord could face severe penalties. If sexual orientation ever becomes an issue, know that it's a violation of the law.</p> <h2>4. Do You Have Any Disabilities?</h2> <p>Many landlords may be genuinely looking out for you here. They may know that the wheelchair access to the building is very poor, or that it would be a tough building for a blind person to negotiate. That is all well and good, but it's not their concern. Someone with a disability has the same rights to rent a home or apartment as an able-bodied person. What's more, every apartment or home up for rent should be made available to a disabled tenant. If the landlord steers you to one particular apartment over all others, they could actually face legal action. When it comes down to it, a person's disability, even if it's severe, cannot be brought into question when renting. It's also worth pointing out that pet policies do not apply to service animals.</p> <h2>5. Tell Me About Your Kids</h2> <p>Another big no-no. Anything relating to kids, whether it's their ages, how many you have, where they go to school, or if you're planning to have any, it's all off limits. Once again, this is all down to the Fair Housing Act. Landlords could use that information to discriminate against a tenant (especially those who believe children will just cause a lot of noise and mess), and the law just does not allow that. You may naturally bring up kids in conversation (especially if you're interested in a park in the area, or local daycare centers), and that is your right. But the landlord cannot and should not initiate it. (By the way, some landlords have found a way to skirt this by assuming you have children, and simply asking for their names on the application. You do not have to complete that information.)</p> <h2>6. So, Do You Go to Church Around Here?</h2> <p>Once again, this may seem like an innocent enough question, but probing about your religion is a direct violation of the Fair Housing Act. The landlord may not mean anything by it, but the assumption could be made that he or she is favoring Christian applicants over all others. Perhaps the landlord is biased for, or against, Muslims or atheists. None of this should have any impact on your application. Your faith, or lack thereof, is your concern, and yours only. Should any question about religion come up, the landlord is breaking the law.</p> <h2>7. Are You Married?</h2> <p>You have to wonder why that would be any concern of the landlord. After all, married people do not necessarily make for better, or worse, tenants. Some married couples are model citizens, others fights constantly and may appear on an episode of <em>Cops</em>. But none of this is relevant anyway, because the landlord is not allowed to ask you anything about your marital status. Even a statement like &quot;I see you two are engaged,&quot; which may be prompted by seeing a ring, is not kosher. You do not have to answer this question, and the landlord asking it could get in trouble for doing so.</p> <h2>8. Are You On Welfare?</h2> <p>A landlord has every right to ask about income. After all, they need to know that you can pay the rent on time, without any trouble. But where you get that income &mdash; that's different. If you are on welfare, receive food stamps, and get other kinds of benefits or public assistance, you can keep that information to yourself. The landlord cannot pry, and cannot deny anyone tenancy based on that information. If he or she does, it's cause for an investigation by the local authorities.</p> <h2>9. How Old Are You?</h2> <p>Seems like a standard question, right? And most rental applications have a &quot;date of birth&quot; section for you to fill in. But, asking about your age is another one of those protected pieces of information covered in the Fair Housing Act. It's quite possible a landlord wants to rent only to people in a certain age bracket. This is against the law. The only time age can be introduced as a factor is if your application is for a senior community or retirement home. Other than that, it's a no go.</p> <h2>10. What Race Are You?</h2> <p>Similar to the nationality question, this is a huge violation of the Fair Housing Act. Even if it's posed as a compliment, (like &quot;You have beautiful olive skin, are your parents Greek or Spanish?&quot;), the landlord is stepping way over the line. No questions about your race can be asked, and if it comes up, you can report the landlord for discrimination.</p> <p><em>Have you ever been asked any of these questions? How did you respond?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/paul-michael">Paul Michael</a> of <a href="http://www.wisebread.com/10-questions-landlords-cant-ask">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-6"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-moves-to-make-if-you-need-to-break-your-lease">8 Moves to Make If You Need to Break Your Lease</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-11-best-websites-for-renting-your-extra-space">The 11 Best Websites for Renting Your Extra Space</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-ways-to-rent-an-apartment-with-bad-credit">7 Ways to Rent An Apartment With Bad Credit</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-smart-ways-to-get-your-apartment-deposit-back">7 Smart Ways to Get Your Apartment Deposit Back</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-you-definitely-need-renters-insurance">5 Reasons You Definitely Need Renters&#039; Insurance</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing apartments discrimination fair housing act illegal landlords questions renting Tue, 24 May 2016 10:30:03 +0000 Paul Michael 1715216 at http://www.wisebread.com The Only 5 Rules of Home Buying You Need to Know http://www.wisebread.com/the-only-5-rules-of-home-buying-you-need-to-know <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-only-5-rules-of-home-buying-you-need-to-know" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/family_new_house_000090470299.jpg" alt="Family learning only rules of home buying they need to know" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Buying a home can be stressful and complicated. But if you follow just five basic rules, you'll make the challenge of buying a home a bit less intimidating.</p> <h2>1. Meet With a Mortgage Lender Before Touring Homes</h2> <p>Touring homes is the fun part of buying. But before you start looking at properties, you need to meet with a mortgage lender.</p> <p>That's because a lender can pre-approve you for a mortgage loan. To do this, your lender will run your credit. You'll have to provide copies of such documents as your last two paycheck stubs, bank-account statements, W2s, and tax returns. Your lender will take this information and determine if you qualify for a mortgage loan, and how large that loan can be.</p> <p>This is important for house hunters. Once you know that a lender will approve you for a mortgage loan of $200,000, you won't waste time looking at homes that cost $300,000.</p> <p>Make sure, though, that you get <em>pre-approved</em> and not <em>pre-qualified</em>. A pre-qualification is when a lender takes down your information by phone and tells you how large of a mortgage loan you can afford. But in a pre-qualification, lenders don't actually verify your financial health as they do when pre-approving you.</p> <h2>2. Review Your Credit Reports</h2> <p>You have three credit reports, one each maintained by the credit bureaus of TransUnion, Experian, and Equifax. These reports list how much you owe on your credit cards and any other loans. They also list if you've missed any payments or paid any bills late. They'll list, too, any negative judgments such as recent foreclosures and bankruptcies.</p> <p>You can order one free copy of each of your three credit reports every year from AnnualCreditReport.com. Once you do, study the reports to make sure that the information contained in it is accurate. If it's not, it could cause your credit score to fall.</p> <h2>3. Order at Least One of Your Credit Scores Before You Start House Hunting</h2> <p>Speaking of credit scores, this three-digit number is critical to anyone buying a home. Lenders rely on <a href="http://www.wisebread.com/15-surprising-ways-bad-credit-can-hurt-you" target="_blank">your credit score</a> to determine how much of a risk you are. If your score is low, say under 640 on the FICO scale, you'll struggle to get a mortgage loan without paying an exorbitantly high interest rate. If your score is above 740, though, you'll generally qualify for the widest variety of mortgage loans and the lowest interest rates on these loans.</p> <p>To determine how strong your credit score is, you'll have to order at least one of your three reports, one each maintained by the credit bureaus again. You can order your score from Experian, Equifax, or TransUnion for about $15.</p> <h2>4. Reduce Your Debt</h2> <p>There's another number that lenders look at when you apply for a mortgage loan &mdash; your debt-to-income ratio. This ratio compares your monthly debt obligations with your gross monthly income. If this ratio is too high, you'll struggle to qualify for a mortgage.</p> <p>Lenders prefer that your total monthly debts, including your estimated new monthly mortgage payment, equals no more than 43% of your gross monthly income. If your debt-to-income ratio is too high, cut down as much of your debt as possible &mdash; maybe starting with credit card debt &mdash; before you start looking for a new home.</p> <h2>5. Interview to Find the Right Real Estate Agent</h2> <p>When you're buying a home, you get to work with a real estate agent for free. When you find and buy a home, your agent is paid by the seller, who uses part of the profit of the home sale to provide your agent with a commission. Because of this, there's no reason not to work with a real estate agent when you're buying a home.</p> <p>But you do want to work with the <em>right</em> agent, so schedule interviews with several. When you're speaking with agents, ask them some key questions: How long have they worked as real estate agents? Do they work often in the neighborhoods that you're targeting? How much of a home's asking price do they shave off on average for their buyers? Do they represent both buyers and sellers or are they exclusively buyers' agents?</p> <p>Be sure, too, to ask agents for referrals from past customers. You'll want to talk to some of these past customers to determine how responsive and effective an agent was for them.</p> <p><em>Is our list of rules too short? What other rules should home-buyers heed?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/the-only-5-rules-of-home-buying-you-need-to-know">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-7"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-money-moves-to-make-for-tomorrows-mortgage">6 Money Moves to Make for Tomorrow&#039;s Mortgage</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-you-shouldnt-buy-a-house-yet">5 Reasons You Shouldn&#039;t Buy a House (Yet)</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/whats-faster-for-mortgage-payoff-100-month-extra-or-1-payment-year-extra">What&#039;s Faster for Mortgage Payoff: $100/Month Extra or 1 Payment/Year Extra?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/everything-you-need-to-know-about-freddie-mac-and-fannie-mae">Everything You Need to Know About Freddie Mac and Fannie Mae</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-things-lenders-look-for-in-a-loan-application">5 Things Lenders Look For in a Loan Application</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing credit reports home buying homeowners house hunting lenders mortgages real estate agents Thu, 19 May 2016 09:30:24 +0000 Dan Rafter 1712868 at http://www.wisebread.com Everything You Need to Know About Freddie Mac and Fannie Mae http://www.wisebread.com/everything-you-need-to-know-about-freddie-mac-and-fannie-mae <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/everything-you-need-to-know-about-freddie-mac-and-fannie-mae" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/couple_new_house_000085110139.jpg" alt="Couple learning everything about Freddie Mac and Fannie Mae" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>If you're applying for a mortgage loan, you've undoubtedly heard the names Fannie Mae (<a href="http://www.fanniemae.com/portal/index.html">Federal National Mortgage Association</a> or FNMA) and Freddie Mac (<a href="http://www.freddiemac.com/">Federal Home Loan Mortgage Corporation</a> or FHLMC). But if you're like most consumers, you have little idea of what Fannie and Freddie actually are, and more importantly, what they do.</p> <p>Both Fannie and Freddie have the same purpose: They buy mortgages from banks, mortgage companies, and savings and loans in order to free up more of their capital for mortgages. These lenders use the extra cash gained by selling their loans to Fannie and Freddie to lend more mortgage dollars to future homebuyers. (See also:&nbsp;<a href="http://www.wisebread.com/everything-a-first-time-home-buyer-needs-to-buy-a-house?ref=seealso" target="_blank">Everything a First-Time Home Buyer Needs to Buy a House</a>)</p> <p>In other words, the purpose of Fannie Mae and Freddie Mac is to ensure that there is mortgage money in the system when you're ready to take out a mortgage loan.</p> <h2>The History of GSEs</h2> <p>You might think of Freddie Mac and Fannie Mae as lenders. That's incorrect. They are officially known as <em>government-sponsored enterprises</em>, or GSEs. And they are the only two GSEs in the country.</p> <p>As a GSE, both Freddie and Fannie are privately owned. But they do receive financial support from the federal government. In return for that support, Fannie and Freddie have agreed to purchase a specific number of loans made by private lenders to low- or moderate-income borrowers. Lenders face a higher risk that such borrowers will default on these loans, and they might not be willing to make as many of them if the two GSEs didn't agree to purchase a percentage of them.</p> <p>It's impossible to know how many of these loans to low- or moderate-income borrowers lenders would make without the promise of these future purchases by the GSEs. But the federal government believes that without the efforts of Freddie and Fannie, the number of these loans would drop.</p> <p>Freddie and Fannie provide what is known as a secondary market for mortgage lenders. They purchase mortgages from lenders, hold some of them in their own portfolios, and sell some as securities that they guarantee. Freddie Mac and Fannie Mae only purchase conforming mortgages that are not guaranteed by a government agency, such as the Department of Veterans Affairs and the Federal Housing Administration.</p> <p>Because they receive support from the federal government, the securities that Fannie and Freddie sell are considered especially safe investments. In fact, investors consider the securities sold by the two GSEs to be almost as safe as securities issued by the federal government itself.</p> <h2>How Do the GSEs Help You?</h2> <p>You won't deal directly with either Freddie Mae or Freddie Mac when you are applying for a mortgage loan. You'll work instead with a private bank or lender. But the presence of the two GSEs does make a difference for you: Mortgage experts estimate that the mortgage interest rates borrowers pay average about a quarter-percent lower than they would be if Freddie and Fannie didn't exist.</p> <p>That quarter-percent drop in your interest rate means that you'll pay less each month for your mortgage payment, and that you'll pay less in interest if you keep your loan for its entire term.</p> <p>You also have a better chance of qualifying for a mortgage loan today if you are a low- or moderate-income borrower, thanks to the commitment by the GSEs to buy a certain number of loans made to such borrowers.</p> <p>This doesn't mean that everyone loves the GSEs. Far from it. The federal government bailed out Fannie Mae and Freddie Mac in September of 2008 after the housing crisis sent both GSEs into an economic spiral. As part of this bailout, the U.S. Treasury Department was given permission to purchase up to $100 billion in Fannie Mae and Freddie Mac preferred stock and mortgage-backed securities.</p> <p>Because of this, the federal government's Federal Housing Finance Agency put both GSEs into conservatorship. This bailout cost U.S. taxpayers $187 billion. However, in 2012 the U.S. Treasury made a decision to put all profits from Freddie and Fannie back into the general fund. Because of this decision, the bailout has since been repaid, and with interest.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/everything-you-need-to-know-about-freddie-mac-and-fannie-mae">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-8"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-only-5-rules-of-home-buying-you-need-to-know">The Only 5 Rules of Home Buying You Need to Know</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-things-lenders-look-for-in-a-loan-application">5 Things Lenders Look For in a Loan Application</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-does-the-fannie-mae-and-freddie-mac-bailout-affect-you">How does the Fannie Mae and Freddie Mac bailout affect you?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-it-safe-to-re-finance-your-home-close-to-retirement">Is it Safe to Re-Finance Your Home Close to Retirement?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-an-fha-home-loan-right-for-you">Is an FHA Home Loan Right for You?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing fannie mae freddie mac government sponsored enterprises GSE home loans lenders mortgages Wed, 11 May 2016 09:30:26 +0000 Dan Rafter 1705412 at http://www.wisebread.com 7 Things You Should Know Before Buying a Foreclosed Home http://www.wisebread.com/7-things-you-should-know-before-buying-a-foreclosed-home <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-things-you-should-know-before-buying-a-foreclosed-home" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_outside_home_000023276605.jpg" alt="Woman considering buying a foreclosed home" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>You're ready to buy a home, but you're also looking for a bargain. A foreclosed home seems like the ideal solution: You know that foreclosed properties typically sell for less &mdash; sometimes much less &mdash; than homes listed and sold on the open market by real estate agents and owners.</p> <p>But what you might not know is that buying a foreclosed property can also prove challenging to anyone who isn't a professional real estate investor. You might not know, either, that some foreclosed homes come with so much damage that the repairs needed to make them livable will quickly eat up any savings on their sales prices.</p> <p>Then there's the matter of actually buying a foreclosure. Depending on how you buy such a property, you might find yourself competing with others who buy, repair, and sell foreclosures for a living. Trying to outbid these pros for your foreclosure is no easy task.</p> <p>To sum up: <a href="http://www.wisebread.com/is-a-buying-a-foreclosed-home-ever-a-good-idea" target="_blank">Buying a foreclosure</a> can be a challenge, one that could cost you plenty of time and money. Here are seven things you absolutely must know if you plan to buy a foreclosed property.&nbsp;</p> <h2>1. Foreclosure Inventory Is Falling</h2> <p>It's becoming more difficult to find a foreclosed property today. That's because fewer homeowners are falling into foreclosure. According to RealtyTrac, foreclosures were reported on 1.08 million U.S. properties last year. That's a drop of 3% from 2014, and a huge fall of 62% from 2010. Back in 2010, more than 2.87 million U.S. properties had foreclosure filings against them.</p> <h2>2. You Can Buy Foreclosures in One of Two Main Ways</h2> <p>There are two main ways to buy a foreclosed home. In the first, lenders auction off homes after the owners of these homes stop paying their mortgages. These properties are then sold at public auctions. The second main way to buy a foreclosure &mdash; the way that works better for most buyers who aren't professional real estate investors &mdash; is to buy a property after a bank takes ownership of it. These bank-owned properties are listed and sold by real estate agents. You can buy them just as you'd buy a home sold in the more traditional way.</p> <h2>3. Buying at Auction Is Not Easy</h2> <p>Buying a foreclosure at a real estate auction is not easy. First, you'll be trying to outbid professional real estate investors. Even more challenging, you'll need to pay for your foreclosed home with cash. It's not many consumers who have $200,000 or more in cash lying around.</p> <h2>4. Foreclosure Auctions Are Sight-Unseen</h2> <p>If you buy a foreclosure at an auction, you won't have the chance to tour its interiors. This means that you are buying the home sight unseen. You'll have no idea what repair jobs face you after you complete your purchase. The repairs could be extensive, and they could swallow any of the savings you expected to enjoy.</p> <h2>5. Buying Bank-Owned Foreclosures Is Far Easier</h2> <p>Buying a foreclosure owned by the bank is a far easier process. In this type of foreclosure, a bank &mdash; which has taken over ownership of a home after its former owners stop making mortgage payments &mdash; sells the house, hiring a real estate agent to close the sale. You can buy one of these bank-owned properties by making an offer, just as you would with any other type of home sale. The real estate agent representing the bank will take your offer, present it to the bank, and come back with a counteroffer if the bank doesn't like your original offer.</p> <h2>6. You Can Still Enjoy Significant Savings With Bank-Owned Foreclosures</h2> <p>RealtyTrac reported that the average bank-owned home sold for 38% less than comparable homes sold at market-rate figures. This means that buyers can save a significant amount of money buying a foreclosure even if they don't do it at the auction level.</p> <h2>7. You Absolutely Need a Home Inspection</h2> <p>Never buy a foreclosed home owned by a bank without first hiring a home inspector to come tour it. Unlike with a foreclosed home bought at auction, you do have the right to a home inspection before closing your sale. Make sure to take advantage of this opportunity. Many foreclosed homes need serious repairs. A home inspector can find these trouble spots. Once you are armed with this information, you can decide whether a particular foreclosure still qualifies as a bargain.</p> <p><em>Have you ever bought a foreclosed home?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/7-things-you-should-know-before-buying-a-foreclosed-home">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-happens-at-a-foreclosure-auction">What Happens at a Foreclosure Auction?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-only-5-rules-of-home-buying-you-need-to-know">The Only 5 Rules of Home Buying You Need to Know</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-long-can-you-stay-in-your-home-after-you-stop-paying-the-mortgage">How Long Can You Stay in Your Home After You Stop Paying the Mortgage?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-we-all-just-stop-paying-the-mortgage">Should We All Just Stop Paying the Mortgage?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-let-these-6-home-d-cor-flaws-ruin-your-house-hunt">Don&#039;t Let These 6 Home Décor Flaws Ruin Your House Hunt</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing auction bank owned home foreclosure house hunting new homeowners risk Wed, 04 May 2016 09:00:11 +0000 Dan Rafter 1703004 at http://www.wisebread.com What Is Private Mortgage Insurance, Anyway? http://www.wisebread.com/what-is-private-mortgage-insurance-anyway <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/what-is-private-mortgage-insurance-anyway" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_fence_house_000024946015.jpg" alt="Woman learning what private mortgage insurance is" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Private Mortgage Insurance is one cost that mortgage borrowers hate to pay. And that's not surprising given than this form of insurance &mdash; Private Mortgage Insurance &mdash; doesn't actually protect homeowners. Instead, it protects mortgage lenders from borrowers who don't make their mortgage payments on time.</p> <p>PMI isn't cheap, either: Freddie Mac says that you can expect to pay from $30 to $70 a month in PMI costs for every $100,000 you have borrowed. According to this formula, you'd pay from $60 to $140 a month in PMI for a $200,000 mortgage.</p> <p>There is good news, though: Conventional mortgage borrowers won't need PMI if they have a large enough down payment. And even if you don't, your lender must drop PMI when you build up enough equity.</p> <h2>The PMI Hit</h2> <p>You'll need PMI if you have a conventional mortgage loan &mdash; one not guaranteed by the government &mdash; whenever you borrow with less than a 20% down payment.</p> <p>Fortunately, PMI isn't permanent on a conventional loan. You can ask your lender to drop PMI when the equity in your home reaches 20%. For instance, if your home originally appraised at $200,000 and you owe $160,000 on your mortgage loan, you now have 20% equity in your residence. If you owe $180,000 on your mortgage and your home is worth $200,000, you only have 10% equity in your home and must keep paying your PMI.</p> <p>If the balance of your mortgage drops to 78% of your home's original appraised value, your lender will automatically drop your PMI.</p> <p>If you want to calculate whether you can eliminate PMI, simply divide the balance of <a href="http://www.wisebread.com/4-reasons-why-youre-too-old-or-too-young-for-a-mortgage-loan" target="_blank">your mortgage loan</a> into the original appraised value of your home. Most often, this appraised value will be the same as your home's original selling price.</p> <h2>Dropping PMI</h2> <p>If you want to drop PMI when your loan value reaches 80% of your home's original purchase price &mdash; which is the same as reaching 20% equity &mdash; you must request the cancellation in writing, sending a letter to your lender. You'll need to be current on your mortgage payments, and you might have to pay for a new appraisal to prove that your home hasn't lost value since you purchased it.</p> <p>When you take out your loan, your lender should provide you with the date on which, if you made your monthly mortgage payments as scheduled, your equity would reach the 20% level. You might reach this equity level earlier, though, if you've made additional payments. You might also reach it sooner if your home appreciates in value. But you'll need a new appraisal to prove that your home's value has risen.</p> <h2>FHA Mortgage Insurance</h2> <p>If you take out a mortgage insured by the U.S. Department of Housing and Urban Development's Federal Housing Administration, you must take out a different form of mortgage insurance. And this insurance is required, no matter how much of a down payment you put down.</p> <p>First, you'll need to make an upfront payment of 1.75% of the amount of your loan. If you take out a mortgage for $100,000, you'll have to pay $1,750 for this upfront premium.</p> <p>You'll also have to pay an annual premium, which you'll pay out in monthly installments throughout the year. For a 15-year fixed-rate loan with a down payment or equity of less than 10%, your annual FHA insurance premium will be 0.7%. For a 15-year loan with a down payment or equity of 10% or more, your annual premium will be 0.45%.</p> <p>For a 30-year loan and with a down payment or equity of less than 5%, your annual insurance premium will be 0.85%. For a 30-year loan with a down payment or equity of 5% or more, your annual insurance premium will be 0.80%.</p> <p><em>Did you have to pay PMI? For how long?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/what-is-private-mortgage-insurance-anyway">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-4"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/everything-a-first-time-home-buyer-needs-to-buy-a-house">Everything a First-Time Home Buyer Needs to Buy a House</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-tax-deductions-new-homeowners-shouldnt-skip">4 Tax Deductions New Homeowners Shouldn&#039;t Skip</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-you-should-be-saving-big-with-bi-weekly-mortgage-payments">Why You Should Be Saving Big With Bi-Weekly Mortgage Payments</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-ways-to-qualify-for-a-mortgage-with-a-small-downpayment">5 Ways to Qualify for a Mortgage With a Small Downpayment</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-you-shouldnt-buy-a-house-yet">5 Reasons You Shouldn&#039;t Buy a House (Yet)</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing buying a house down payments equity new homeowners pmi private mortgage insurance Tue, 03 May 2016 09:00:05 +0000 Dan Rafter 1702378 at http://www.wisebread.com Everything a First-Time Home Buyer Needs to Buy a House http://www.wisebread.com/everything-a-first-time-home-buyer-needs-to-buy-a-house <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/everything-a-first-time-home-buyer-needs-to-buy-a-house" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/couple_home_buyers_000062916622.jpg" alt="Couple learning what they need to buy a house" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The number of people buying homes for the first time is falling, according to the most recent data from the National Association of Realtors.</p> <p>According to the association's 2015 Profile of Home Buyers and Sellers report, only 32% of buyers in 2014 were purchasing a home for the first time. That's the second-lowest percentage of first-time buyers since the survey's start in 1981, beating out only 1987's survey, in which just 30% of all buyers were first-timers.</p> <p>However, this still means that plenty of first-timers are in the market today. And they are entering a housing market in which prices in major markets are continuing to rise.</p> <p>What do these buyers need to successfully land that first home? Here are five of the most important advantages that a first-time buyer can bring to the house hunt.</p> <h2>A Large Down Payment</h2> <p>Mortgage interest rates remain at historically low levels. According to Freddie Mac's Primary Mortgage Market Survey, the average interest rate on a 30-year fixed-rate mortgage loan stood at 3.59% as of April 7. That's the lowest this figure has been in 2016.</p> <p>But to qualify for such a low rate, first-time buyers &mdash; and all buyers, really &mdash; will need a solid down payment. In general, the larger the down payment you can provide, the lower your mortgage interest rate will be.</p> <p>There's a reason for this: When you have more money invested in your home at the start, lenders believe that you'll be less likely to stop paying your mortgage should you run into financial challenges. This makes lending you mortgage money less of a risk. And when you're less of a risk, lenders don't need as high of an interest rate to protect themselves.</p> <p>Ideally, you can come up with a down payment of 20% of your home's purchase price. That's a lot of money, though; for a home costing $200,000, such a down payment would cost $40,000. Fortunately, you can still qualify for solid rates even with a down payment as low as 5% of your home's purchase price, if your other financials are strong.</p> <h2>A Good Credit Score</h2> <p>Your FICO credit score is a key number when buying a home. Lenders rely on this number to gauge how well you've handled credit and paid your bills in the past. In general, lenders consider a FICO credit score of 740 or higher to be a good one.</p> <p>Realtor.com reports that the average FICO credit score of approved mortgage borrowers stood at 718 during the last six months of 2015 and the first three of 2016. If your score is near that level, then, you should have a good chance of qualifying for a mortgage loan.</p> <p>The higher your score, the lower your interest rate will be. Getting to that 740 level isn't always easy. According to Realtor.com, the average U.S. adult with a credit score had a score of 695 during the last six months of 2015 and the first three of 2016.</p> <p>A host of factors determine your credit score. The <a href="http://www.wisebread.com/this-one-ratio-is-the-key-to-a-good-credit-score">key to a good score</a>, though, is relatively simple: Pay your bills on time every month, cut down your credit card debt, and never close a credit card account, even when you don't use it.</p> <h2>Plenty of Cash</h2> <p>You'll need plenty of cash to buy your first home. First-time buyers, in fact, typically need <em>more </em>available funds because unlike repeat buyers, they can't count on any cash from selling a home.</p> <p>You'll need cash for your down payment, of course. But you'll also need it for closing costs. Closing costs are the fees that lenders and other third-party sources, such as title companies, charge for closing your mortgage loan. Closing costs can vary, but in general they average about 2.5% of your home's purchase price.</p> <p>If you are buying a home that costs $180,000, you can expect to pay about $4,500 in closing costs.</p> <p>The good news? You can accept gifts from relatives or friends to cover your closing costs. The key, though, is that these gift funds have to truly be gifts. The person gifting you the dollars can't expect you to pay them back. Otherwise, your lender will count your gift as a loan, and that will boost your monthly debt obligations.</p> <h2>A Low Debt-to-Income Ratio</h2> <p>Your debt-to-income ratio is another key number when you're buying a home. As the name suggests, this ratio compares your monthly debt obligations with your gross monthly income. Lenders today want your total monthly debts, including your estimated new mortgage payment, to equal no more than 43% of your gross income.</p> <p>If your debt-to-income ratio is too high, you'll struggle to qualify for a mortgage. Lenders will worry that adding a mortgage payment to your already high debt obligations will boost the chances that you'll fall behind on your home-loan payments.</p> <h2>A Steady Income</h2> <p>Lenders prefer that you have a work history of at least two years at your current employer or, at the least, in your current field. Not having this history isn't usually a deal-breaker, but it can cause lenders to hesitate before approving you. And if you have any other financial challenges &mdash; high debts or a middling credit score, maybe &mdash; a shaky job history will increase your odds of a mortgage rejection.</p> <p>When you apply for a mortgage loan, you'll have to provide lenders with a signed letter from your employer stating your position and annual salary. Lenders want to make sure that your monthly income is high enough to support the addition of a mortgage payment.</p> <p><em>Anything we've overlooked? What else does a first-time buyer need to buy a home?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/everything-a-first-time-home-buyer-needs-to-buy-a-house">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-11"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-you-shouldnt-buy-a-house-yet">5 Reasons You Shouldn&#039;t Buy a House (Yet)</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-reasons-why-youre-too-old-or-too-young-for-a-mortgage-loan">4 Reasons Why You&#039;re Too Old — Or Too Young — For a Mortgage Loan</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-is-private-mortgage-insurance-anyway">What Is Private Mortgage Insurance, Anyway?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-times-you-shouldnt-rush-to-pay-off-your-mortgage">5 Times You Shouldn&#039;t Rush to Pay Off Your Mortgage</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-why-a-30-year-mortgage-is-a-smart-financial-choice">Here&#039;s Why a 30-Year Mortgage Is a Smart Financial Choice</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing credit score debt down payments first-time buyers mortgages new homeowners Thu, 28 Apr 2016 10:01:08 +0000 Dan Rafter 1697849 at http://www.wisebread.com The 3 Best Cities With Rent Control http://www.wisebread.com/the-3-best-cities-with-rent-control <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-3-best-cities-with-rent-control" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_city_selfie_000083881091.jpg" alt="Woman living in best city with rent control" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Rent control is the dream of renters everywhere. Yet only four states &mdash; California, New York, Maryland, New Jersey &mdash; and the District of Columbia have rent control policies in place. Read on for our guide to scoring a rent-controlled apartment in one of the best cities where price-protected apartments are signed into law.</p> <h2>San Francisco</h2> <p><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5171/san_francisco_street_000024852251.jpg" width="605" height="340" alt="" /></p> <p>San Francisco is one of 15 <a href="http://www.dca.ca.gov/publications/landlordbook/appendix2.shtml">California cities with rent control</a>. It's also one of the priciest places to rent an apartment in America. And while some city dwellers say rent control, along with foreign buyers and an influx of tech workers, exacerbate the sky high cost of housing, many folks, such as Joe Leung, are <a href="http://www.nbcbayarea.com/news/local/San-Francisco-Housing-Rent-Up-A-Sizzling-148-Percent-in-12-Months-300995041.html">thankful for the relief</a> rent control provides them. Leung, who is 42, is a tenant in a rent-controlled Chinatown complex. He pays $540 a month for a single room. That's about one-fifth the list price of a studio in that same area. In this city where the median rent tops $3,000, rent-controlled apartments are a huge help to many families, and people like Leung, who are just trying to make ends meet.</p> <p>In San Francisco, rent-controlled units are those that were issued a certificate of occupancy before June of 1979, which amounts to a whopping 82% of the multi-family unit market. The rules are as follows: Landlords of rent-controlled units may <a href="http://www.sftu.org/rentcontrol/">raise a tenant's rent</a>, but only by a set amount tied to inflation &mdash; the annual allowable rent increase for 2016&ndash;2017 is 1.6% &mdash; and not more frequent than once every 12 months. Landlords can petition for additional increases tied to costs such as capital improvements or maintenance, but these hikes must be approved by the Rent Board before they can be passed on to the tenant.</p> <p>If Frisco's rent control policy sounds like a dream come true, be sure to note the following: While Leung enjoys his $540 monthly rent, some of his neighbors in the same Chinatown building are paying upwards of $1,200. That's because the city's policy allows landlords to adjust the rent of any rent-controlled unit to match the market rate when a tenant vacates the unit. When the vacancy is filled, the tenant's new, market-adjusted rent price becomes controlled by the aforementioned rules. So, theoretically, if an apartment is rent-controlled at $540 monthly in 1990 and the tenant moves out in 2016, the next tenant's rent very well may rise by several thousand dollars, depending on the market price. This facet of the law has been criticized for facilitating an environment in which landlords have an incentive to nudge out their tenants. Of course, the law includes protections to help insure that doesn't happen.</p> <p>A renter's search for a rent-controlled apartment in San Francisco would be most fruitful in <a href="http://www.trulia.com/blog/trends/rent-control-sf-nyc/">the oldest neighborhoods</a>, such as Forest Knolls, Downtown, the Marina, Russian Hill, Nob Hill, and Golden Gate Heights. Old may mean cheaper, but it doesn't necessarily mean cheap. Nob Hill, for example, is a long-established, upscale section of the city, where two-bedrooms go for nearly $5,000. Many rent-controlled apartments in Nob Hill are priced far higher than the average renter can afford to pay. The fewest rent-controlled options are in areas dominated by new construction, such as SoMa and Mission Bay. Notably, public housing projects are exempt from rent control, as well as most single-family homes and condos.</p> <p>Benefits of scoring a place to live in San Francisco include access to great restaurants, wine country, and tons of high-paying jobs, especially those in the tech sector.</p> <h2>Washington, D.C.</h2> <p><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5171/washington_dc_street_000016584691.jpg" width="605" height="340" alt="" /></p> <p>Rent control provides residents of the nation's capital with a layer of protection against the prohibitive cost of living in a housing market where affordable options are quickly vanishing. Housing is generally deemed affordable when it amounts to no more than 30% of a household's income. But in D.C., the inhabitants of more than half of all rental units spend more than 30% of their income on rent. The median price for a one-bedroom rental in D.C. is now $2,000. There are <a href="https://www.washingtonpost.com/local/dc-politics/study-no-inexpensive-housing-left-on-open-market-in-dc/2015/03/11/281aaa94-c80c-11e4-b2a1-bed1aaea2816_story.html?tid=a_inl">almost no more apartments</a> in D.C.'s open market that rent for less than $800 monthly.</p> <p>Established in 1975, D.C.'s rent control law now covers more than 60% of all rental units. Apartments are generally rent-controlled if they're in buildings constructed before 1975 and owned by landlords who control at least five units. Federally subsidized units are exempt from the law. Landlords of rent-controlled units may not raise the rent more than the current rate of inflation plus 2%, and the rent generally cannot be raised more than once a year. When a tenant vacates a unit, however, the law permits landlords to raise the rent by up to 30%. As is the case in San Francisco, future tenants of rent-controlled units are typically charged much higher rents than the tenant before them. No matter how you dice it, the cheapest apartments, by logic, are already taken.</p> <p>Though it's not a perfect system, the benefits of scoring a rent-controlled apartment in the nation's capital are indisputable &mdash; access to some one the world's best museums, political events and universities, as well as a cap on annual rent raises. Finding a rent-controlled unit, however, takes a little detective work. Luckily, landlords are mandated to divulge whether their building is rent-controlled. All you have to do is ask. You can also find out whether a particular apartment is subject to rent control by calling the D.C. rent administrator's office, which keeps a database of these units.</p> <h2>New York City</h2> <p><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5171/new_york_city_000050678398.jpg" width="605" height="340" alt="" /></p> <p>The city that never sleeps lures new residents for many reasons &mdash; the art, the theater, the big wig jobs &mdash; but the cost of living ain't one of them. The average New York rent tops $3,000, making it one of the nation's most expensive places to lay your head at night. Another blow to affordable city living: Less than 2% of New York's apartments are rent-controlled, a status applied to units in buildings erected before 1947. The clincher is that these units must have been occupied by the same family since 1971. Rent-controlled apartments can be passed down within a family, but only to a family member who resided in the unit for a minimum of two years prior to the key exchange. In other words, New York's rent control policy is all in the family, leaving most of us lustful and out of luck.</p> <p>But, to prevent average Joe city dwellers from getting completely priced out of the market, New York also has a rent stabilization program that works similarly to rent control in other big cities. While <a href="http://www.nycrgb.org/html/resources/faq/rentcontrol.html">the guidelines are complicated</a> with many caveats and exceptions, most rent-stabilized apartments in New York are in buildings of six or more units erected before 1974 and priced below $2,500 monthly. Landlords cannot raise rents above a certain ceiling dictated by inflation. For 2014&ndash;2015, the increase was capped at 1% for a one-year lease. Once the rent reaches $2,500, however, or if the tenant's income surpasses $200,000 two years in a row, the landlord can deregulate the apartment and adjust the rent to match current market rates. All told, about 45% of New York's apartments are rent stabilized, making your chances of snagging one about 50/50.</p> <p>The <a href="http://nycrgb.org/html/resources/zip.html">New York City Rent Guidelines Board</a> keeps a list of all the city's rent-stabilized units. Inwood and Washington Heights are the Manhattan neighborhoods with the largest concentration of regulated units. In Brooklyn, Crown Heights is your best bet.</p> <p><em>Do you wish you lived in a rent-controlled apartment?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/brittany-lyte">Brittany Lyte</a> of <a href="http://www.wisebread.com/the-3-best-cities-with-rent-control">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-12"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-moves-to-make-if-you-need-to-break-your-lease">8 Moves to Make If You Need to Break Your Lease</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-you-definitely-need-renters-insurance">5 Reasons You Definitely Need Renters&#039; Insurance</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-simple-way-to-decide-how-much-rent-you-can-really-afford">The Simple Way to Decide How Much Rent You Can Really Afford</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-ways-to-apartment-hunt-on-craigslist-without-getting-scammed">6 Ways to Apartment Hunt on Craigslist Without Getting Scammed</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-questions-landlords-cant-ask">10 Questions Landlords Can&#039;t Ask</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing apartments cost of living expensive cities new york city rent control renting San Francisco washington dc Wed, 27 Apr 2016 09:00:10 +0000 Brittany Lyte 1694763 at http://www.wisebread.com First-Time Home Buyer? Consider These 5 Cities http://www.wisebread.com/first-time-home-buyer-consider-these-5-cities <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/first-time-home-buyer-consider-these-5-cities" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/couple_first_home_000090470349.jpg" alt="Couple moving to best city for first-time home buyers" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The Great Recession has come and gone, leaving economic disparity in its wake. The result is an America in which certain cities are supreme for mortgage newbies looking for a home, while others are not so hot. Read on for our roundup of the friendliest locales for first-time home buyers. (See also:&nbsp;<a href="http://www.wisebread.com/the-5-best-cities-for-starting-over?ref=seealso" target="_blank">The 5 Best Cities for Starting Over</a>)</p> <h2>1. Colorado Springs, Colorado</h2> <p>This city at the foot of the Rockies ranks number one in WalletHub's rating of the best big cities for first-time home buyers. With a gorgeous natural living environment, the median home value in Colorado Springs is just under $222,000, and experts say it's on the rise, making it a seller's market.</p> <p>But don't let the fact that the market isn't tilting toward buyers scare you off.</p> <p>The city's resale market is recovering after taking a big hit during the recession. More buyers are looking, and what they're finding has a lot of promise: In 2014, the Colorado Springs area <a href="http://gazette.com/colorado-springs-housing-market-off-and-running-in-2015/article/1548370">added nearly 4,900 jobs</a>, almost tripling the expectations of many experts. Another perk: 30-year, fixed-rate mortgages have stayed below 4% since late 2015. Low rates make home-buying more affordable for newbie buyers, while the rosy jobs market bolsters consumer confidence &mdash; a combination that's fueling the market. Prices are on the rise, but that bodes well for resale opportunity in the future.</p> <h2>2. Austin, Texas</h2> <p>With a loan funding rate of 68% and 148 mortgage lenders to choose from, Austin is in the thick of a housing boom. The area's median housing price settles around $264,000, marking an 8.8% jump in the annual median sales price. Here's why that's good for first-time buyers: Housing prices are rising, but compared to the rest of the nation, they're still fairly cheap. There's also a population growth surge and a housing supply shortage, which means prices are likely to continue to rise. The three-year home price growth projection for Austin is 27%.</p> <p>With a strong year-over-year job growth of 3.3%, Austin is a great market to buy into now before it becomes too hot to touch. &quot;As long as people continue to move here, we're going to continue with a robust economy,&quot; says Austin area real estate agent Grant Whittenberger. &quot;Texas is becoming a destination for people in states <a href="http://www.mystatesman.com/news/business/austin-housing-market-stays-hot-sets-records-for-s/np9Kb/">facing difficult economic times</a>.&quot;</p> <h2>3. Virginia Beach, Virginia</h2> <p>With a median home sales price of $235,000, Virginia Beach's housing market is seeing big signs of recovery. It's also riding high on a forecast of slow but steady economic improvement. These factors have earned this city of boardwalks, beaches, low crime, and good schools a spot on Realtor.com's top 10 ranking of real estate markets to watch in 2016. Virginia Beach also just so happens to be one of the <a href="http://money.usnews.com/money/personal-finance/real-estate/articles/2009/08/19/americas-10-best-places-to-grow-up.html">best places to grow up</a>.</p> <h2>4. Charlotte, North Carolina</h2> <p>Homes are quickly moving off the market in this North Carolina city known for its funky neighborhoods, celebrated health care system, and close proximity to both the beach and mountains. Trulia Housing Economist Ralph McLaughlin ranked the Charlotte area number two in his roundup of <a href="http://www.trulia.com/blog/trends/2016-housing-predictions/">10 markets to watch</a> in 2016 based on a healthy combination of affordability, job growth, and online search activity. With a median home value just under $166,000, now is a great time to buy in. Bonus: The Charlotte area also has a large share of Millennials.</p> <h2>5. Tampa Bay, Florida</h2> <p>With coastal beauty, wonderful weather, top notch entertainment, a prized casual lifestyle, and loads of Millennials, Tampa is an undervalued, under-the-radar real estate market that's well-suited to entry-level home buyers. The median listing price in greater Tampa, which includes the vibrant St. Petersburg area, is just under $170,000, which is more than $50,000 below the national average. With more than 21,000 listings to choose from, data shows that 18% of all Tampa Bay homes lost value in the year ending in August 2015, which means it's a good time to snap up a good price on a home here. Despite recent value loses, the housing market continues to recover from the recession, and that bodes well for future resale.</p> <p><em>Where are you looking to buy a first home?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/brittany-lyte">Brittany Lyte</a> of <a href="http://www.wisebread.com/first-time-home-buyer-consider-these-5-cities">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-13"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/33-places-to-retire-if-you-love-the-rain">33 Places to Retire If You Love the Rain</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-is-private-mortgage-insurance-anyway">What Is Private Mortgage Insurance, Anyway?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-things-you-should-know-before-buying-a-foreclosed-home">7 Things You Should Know Before Buying a Foreclosed Home</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-hidden-housing-costs-new-homeowners-dont-expect">10 Hidden Housing Costs New Homeowners Don&#039;t Expect</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-why-a-30-year-mortgage-is-a-smart-financial-choice">Here&#039;s Why a 30-Year Mortgage Is a Smart Financial Choice</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing buyers’ market colorado florida housing markets new homeowners north carolina texas u.s. cities virgina Tue, 26 Apr 2016 09:00:11 +0000 Brittany Lyte 1695511 at http://www.wisebread.com