Buying your Dream Home: How to Avoid a Nightmare!

Buying your dream home shouldn’t turn into a nightmare. Make sure you know how much of a mortgage you qualify for before you start looking.  We can help! Call our office to get prequalified at 412-243-0218.

Check out this great article and video from Destination Home via Yahoo.com

Buying a house may be the American Dream, but what mistakes do you need to avoid when buying your dream home?

In this episode of Destination Home, Rutenberg Realty agent and founder of BuyingNYC.com Brad Malow details how people can figure out if they can afford their dream home, and he addresses common mistakes homebuyers make in the process.

He says stretching the budget is one of the biggest mistakes homebuyers can make. The financial crisis pretty clearly set the precedent for how well that works out (horribly!).

“If we look at what happened a few years back before the housing market crashed, people were taking short-term mortgages, buying dream homes, and ending up in foreclosure and losing their shirts,” Malow tells Destination Home.

Home affordability is more complicated than most think, and Malow lays out what you need to consider in terms of your income, debt and lifestyle. He encourages people to remember that banks don’t ask how much you shop or vacation when you're applying for a mortgage. 

If you’ve crunched the numbers and the affordability of owning versus renting is very close, this might be one instance where Malow would give you the green light to stretch your budget and buy — but only stretch a little. Check out the video to hear his advice.

Another common mistake for those in their 20s and 30s is busting the budget to buy a starter home, thinking you have not yet reached your peak earning potential. According to Malow, do not assume your income will increase in the future. In fact, when calculating affordability you should base your math on your lowest annual salary. 

Yet another mistake he sees this demographic of buyers make is pouring money into renovations. Wait, don’t you want to improve your home's value? Maybe not as much as you’d think. Check out the video to find out why and learn when it's a good time to invest in turning your fixer-upper into your dream home.  http://finance.yahoo.com/news/buying-your-dream-home--how-to-avoid-a-nightmare-185825729.html

6 Worst Home Fixes for the Money

Check out this great article from Dana Dratch of Bankrate.com

It's the magic phrase uttered by almost anyone who's ever considered the cost of home remodeling: "We'll use our home equity and get it back when we sell."

Unless you keep those projects practical, though, you might just be kidding yourself.

 

Every year, Remodeling magazine looks at the hottest home upgrades and renovations and calculates just how much owners get back when they sell.

 

Upkeep is more popular than upgrades these days, says Sal Alfano, editorial director for Remodeling. These are the projects that often recoup the biggest slice of expenses at resale. But prices and returns do vary regionally, he says.

 

Ever wonder what brings the lowest return when you plant that "for sale" sign? Think high-dollar, high-end and highly personalized add-ons that make you drool. Like a totally tricked-out garage built from the ground up. Or a super luxe master suite addition. Or the home office redo designed just for you.

Here are the six improvements that, in their 2010 report, ranked dead last nationally when it comes to getting those renovation dollars back at resale.

 
HOME OFFICE REMODEL

Want to get an idea what today's office-away-from-the-office looks like? Walk into Starbucks.

These days, a home office consists of a multiple-choice combination of wireless laptops, smartphones, PDAs and touch-screen tablets. And that worker bee might be toiling anywhere from a home patio or a favorite restaurant to a park bench.

The standard home office renovation, meanwhile -- complete with plenty of built-in storage and high-tech wiring -- is this year's biggest loser in the resale value sweepstakes. Nationally, homeowners spent an average of $28,888 and can expect to recoup about 45.8 percent at resale, according to the report.

Return on investment doesn't reflect your enjoyment of the space, Alfano says.

He offers two tips for home-office remodelers when they sell. First, opt for something that can be easily converted back into a bedroom or den for (or by) the next buyer.

Second, when you're selling, call it a study, den or hobby room. "There's lots of call for multipurpose space. Don't lock yourself into that one use," Alfano says. Don't use words that invoke images of actual work. Or the office.

BACKUP POWER GENERATOR

You see a backup generator and imagine all of the comforts no matter what the weather.

But potential buyers hailing from outside your local area may not share that vision. (And a handful of those who do might have watched too many zombie movies.)

On average, when homeowners have a heavy-duty backup power generator installed, they spend about $14,718, according to the report. Going with a slightly less expensive model or having a less complicated installation could cut the costs significantly, Alfano says.

Average amount of the price recovered at resale time: 48.5 percent.

SUNROOM ADDITION

Real estate agents will tell you that potential buyers want square footage, pristine condition and lots of light. So a brand-new room that has the word "sun" in it, it has to be great for resale value, right?

Not necessarily.

Your first clue: The word "addition" -- which means expanding the footprint of your home -- indicates that this is not a renovation for the faint of heart (or wallet). "It's one of the more expensive projects," Alfano says.

While it seems simple enough, the national average for a sunroom addition is $75,224, according to the report. Homeowners can expect to recoup about 48.6 percent when they sell.

That doesn't mean that adding a sunroom is always a bad move.

If your home needs another common area, a sunroom could be the answer, says Katie Severance, co-author of "The Complete Idiot's Guide to Selling Your Home." An addition is best considered in the context of the whole home, she says. "The doctor has to treat the whole patient. You have to look at the house and say 'What's out of balance?'"

UPSCALE MASTER SUITE ADDITION

Who doesn't want to wake up in a five-star-hotel-quality suite with an attached spa bathroom and a kitchenette that affords you coffee and pastries before facing the world?

Once you see the price tag, it won't just be the coffee keeping you up at night.

For a super-deluxe master suite addition -- which adds square footage and uses only top-dollar materials -- the average cost is about $232,062, according to the report.

That's 460 nights at a posh resort with enough left over to raid the minibar.

In years past, this project was "sort of a trend in vacation homes" that migrated to primary dwellings, Alfano says. Sellers can expect to recover about 52.7 percent at resale.

Your buyer can purchase a newer house with the same features as part of the original floor plan that "probably lays out better anyway," says Loren Keim, author of "How to Sell Your Home in Any Market."

So while the next buyer may appreciate your luxury accommodations (which could even tip their decision in your home's favor), chances are they won't want to pay the full tab for your remodel.

BATHROOM ADDITION

Unless you're a hermit who never entertains, you've probably wished for an extra bathroom now and then.

But bathroom additions require serious coin. For a moderately outfitted addition with synthetic stone or plastic laminate surfaces, figure parting with about $21,695, according to the Remodeling report. Go upscale, with finishes like premium marble or fine tile, and you can easily spend in the neighborhood of $40,710.

Either way, you get about the same return: 53 cents on the dollar. "In the buyer's mind, the additional bathroom isn't worth that additional $20,000 to $40,000," Keim says.

Investigate a less-expensive way to get the same result without flushing quite as much cash. While additions usually cost more, pros might be able to reconfigure your existing space to add a bathroom for less, Alfano says.

UPSCALE GARAGE ADDITION

Instead of cleaning out the garage, how much would you pay to have a new one built from scratch?

This time, it would have all the organizational built-ins, and a durable, easy-to-clean floor to ensure it would never be messy again. And windows for natural light.

Oh yeah, and you could store a couple of cars in there, too.

The price tag for a top-of-the-line detached two-car with all the trimmings is about $90,053, according to the report. You can expect to recover about 53.6 percent of that when you sell.

"This one is completely decked out on the inside," says Alfano. "It's a dream garage."

And that's likely some of the problem with recovering the value at resale. Says Keim, "You've got a very small target audience out there that wants an upscale garage."

Read more: http://www.bankrate.com/finance/real-estate/6-worst-home-fixes-for-the-money-1.aspx#ixzz2aeWw6FEH 

'Burgh ranks as top city for growth in 2012

U-Haul ranked our 'burgh as the Top City for Growth in 2013! If you know anyone thinking about making a move, we can help with their financing. Have them call our office at 1-800-898-9688!

PHOENIX (April 12, 2013) — U-Haul International, Inc., today released results of the annual

U-Haul National Migration Trend Report that reflects the nation’s top growth areas for families that moved during 2012. The U-Haul 2012 Top U.S. Growth Cities Report indicates that for cities with more than 5,000 families moving, Pittsburgh takes the No. 1 spot with the highest percentage of growth, at 9.04 percent.

“The report, reflective of growth patterns in the United States during 2012, was compiled based on nationwide trends in cities of all sizes and reflects communities with more than 5,000 families moving in or out of the area,” stated John “J.T.” Taylor, president, U-Haul International, Inc. “Growth cities were then determined by calculating the percentage of inbound moves vs. outbound moves for each area.”

The U-Haul 2012 Top U.S. Growth Cities Report was compiled from more than 1.6 million U-Haul one-way truck transactions occurring during a recent 12-month period.

The annual mileage of North American U-Haul rental trucks, trailers and tow dollies would move a family to the moon and back again more than 9.9 times per day, every day of the year and could also travel around the Earth more than 177 times per day, every day of the year.

What Home Buyers want in 2013

So  what is today’s buyer looking for?  A study recently released by the National Association of Home Builders reports that first and foremost, buyers want energy efficiency.  Four of the top most wanted features involve saving energy.  A whopping 94% of buyers want energy-star rated appliances, 91 % want an energy-star rating for the whole home and  89% want energy-star rated windows.

 

 

 

The study also revealed that what buyers are looking for this year is organization.  Over 93% of buyers put a laundry room near the top of their most desired features and in fact, 57% said they wouldn't even consider buying a home without one.  Moreover, 9 out of 10 buyers want a linen closet in the bathroom to help keep organized.  Space in the garage for storage also ranks high on their wish list.  A walk-in pantry is something that 85% of buyers have on their wish list for 2013. 

The survey also revealed what buyers this year are NOT looking for.  More than half of the buyers surveyed said that they would turn down a home if the master bathroom only included a stand-up shower and no bathtub.  Interestingly, four of the next five most unwanted features are not about the home itself, but the surrounding community.  For example, 66% of buyers stated they did not want to live in a golf course community, 56% rejected the idea of living in a high density community, and 48% said no to a gated community.   Surprisingly the study revealed that many buyers now consider previously desired features such as high ceilings in family room and entry ways as a turn off.  Many of them now consider these large open spaces as energy inefficient, the last thing they want for their new home. 

So how can you help your home buyers if they find a home that isn't quite so energy-efficient?  The answer is one of the most underutilized government programs available, the FHA Energy Efficient Mortgage!  Did you know that your buyers can borrow up to $8,000 ABOVE the purchase price of the home to spend on making it more energy efficient?  That’s right; borrowers may use the Energy Efficient Mortgage Program to finance the cost of energy improvements into their new mortgages without the need to qualify for additional financing.  This is because cost effective energy improvements result in lower utility bills making more funds available for their mortgage payments!  And how it all works it quite simple.  A Home Energy consultant will complete a measurement of the home or perspective property’s energy efficiency and provide you a report listing the recommended cost efficient energy improvements and an estimated cost vs. saving for you and your lender.  You may finance the cost of the energy inspection report as part of the mortgage.  The amount of the improvements are placed into an escrow account and released after an inspection verifies that the improvements are installed.  You can begin making energy improvements as soon as the loan closes and have up to 90 days to complete the work. 

Call our office today at 800-898-9688 for more information on how using the Energy Efficient Mortgage program can help you close more deals in 2013!

If you’re buying a home or simply refinancing, the first decision you need to make is where to obtain financing. The majority of people go to their local bank because they trust them and they aren't sure where else to go. But did you know there are BIG differences between Mortgage Brokers and your local bank?
 
The loan officers employed by banks, credit unions or other lending institutions are limited by the products their bank offers. If the bank has certain guidelines that you don’t meet, they can’t help you. Banks are very conservative in their guidelines for lending and this means certain people who don’t fit in the banks “neat little box” can’t get a loan. Brokers on the other hand have access to hundreds of lending institutions, which makes them a better choice for everyone; especially borrowers who may have more difficulty obtaining financing. Because brokers have access to so many different options, they can often obtain a better interest rate. Brokers have access to rates on a wholesale level, so if you think of it in terms of a retail store; going to your bank is like getting a mortgage from Target, while a going to a broker is like a Costco or Sam’s Club.

 When it comes to the processing of the loan paperwork, Brokers definitely have a leg up on banks. Banks have stricter guidelines for qualifying and this bureaucracy can lead to extremely long processing times. In fact, we just closed a loan for someone who was waiting over 4 month for their bank to process their loan and in the end the bank wasn't even able to get the deal closed! At Northern States Mortgage, not only did we get them qualified, but we closed their loan in less than 30 days! Brokers are able to develop professional and personal relationships with the representatives of lending institutions allowing them to reduce the processing time of the application and get things rushed when needed.

 Another huge difference between your local bank loan officer and a mortgage broker is licensing requirements. Any loan officer who works for a mortgage broker has to pass very strict Federal and State Licensing requirements. Each individual loan officer must complete 20 hours of education and pass a rigorous exam. In fact, only 68% of candidates sitting for the test pass on their first try. Even after they pass the test, they must complete an additional 8 hours of continuing education each year. In addition to the education and exam requirements, each loan officer must pass a criminal background check, a personal credit check and a tax certification check. Loan officers working for a bank are only required to register their names and fingerprints with the National Mortgage Licensing System…and that’s it!

But perhaps the biggest advantage of the broker over your bank is that they know the business! Mortgage Brokers live, eat and sleep Real Estate and Finance. They follow trends and stay up to date on ever changing lending laws and guidelines, making them the best choice to save you time, effort and money!

CALL OUR OFFICE TODAY at 1-800-898-9688 AND FIND OUT WHY WE CAN BEAT YOUR LOCAL BANK!!! or visit us online at www.PreMortgagePgh.com

 

Residential Refinance and Purchase Money Mortgages
Licensed by the PA Department of Banking License #20780, NMLS #100397
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