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Tag: Bradenton real estate

Declutter, depersonalize, clean

Written by Louise Bolger on . Posted in Business, Castles in the Sand.

After perusing what I like to consider my very organized database of columns, I realized it’s been some time since I wrote about getting your house ready for sale. Since we are dead in the middle of the busy selling season, it may be time for a tune-up.

According to the National Association of Realtors, more than 40% of buyers look at listings online as their first step. Because of this, you need to have excellent and clear pictures of your home done by a professional photographer experienced in real estate listings.

Before the pictures are taken you need to declutter, depersonalize and clean your home within an inch of its life. Out of the three of these, cleaning is by far the most important and the most obvious to buyers when they walk in the front door. Even if you are a good housekeeper or your regular housekeeper does in your opinion a good job, you should consider hiring a company that specializes in deep cleaning. Dust building up in corners and on baseboards, fans – especially high ones – and bits of mold are frequently overlooked when you’re living in a home day to day.

Next is decluttering and packing away excess furniture and things you don’t need for everyday living, including any items overstuffing your closets. Not only will this make your home appear cleaner and more spacious, it will also give you a head start on packing for your move.

Not everyone views clutter through the same eyes. Kitchen countertops cluttered with toasters, air fryers, two kitchen types of coffeemakers, countertop ovens, panini presses and every other type of small appliance we’ve all been guilty of buying and infrequently using should be put away. All of this also applies to bathrooms – hairdryers, electric razors, 10 different types of shampoo and crème rinse is something buyers don’t need to know about.

We all have collectibles and souvenirs from vacations and gifts from family members displayed around our home. Well now is the time to decide that the plastic hula girl statue your son insisted on bringing back from Maui has to go and pack away everything else that you aren’t attached to.

The part of the decluttering process that is the most painful is the pictures. Family photos are wonderful reminders of weddings, vacations and those big special moments in our lives, however, don’t forget this is your life, not a potential buyer’s. Family photos also can become a distraction for buyers touring your home. Everyone is a little curious by nature and they love to stop and look at your daughter’s wedding and your children’s first day of school down through the years.

All of this declutter advice also is important on the outside of your home. Whatever you can do to perk up the curb appeal with flowers, trimmed lawns, fresh paint and pressure washing will be helpful.

It should go without saying that all appliances and systems be in working order along with any booklets about them and the year they were installed.

After you have done everything above, the final cleaning job is to clean the windows. Again, a professional window cleaner will do wonders at least until it rains again. Plan on having him or her on retainer while your home is on the market, especially if you live on the beach.

I think I’m done, at least for the big stuff. The object is to set a stage that will make the buyers feel they can make your home their home where they aren’t distracted by personal items and want to stay awhile. Hopefully, it will be a busy season and you all have successful transactions; good luck.

Castles in the Sand

You found the perfect house; now what?

Written by Louise Bolger on . Posted in Business, Castles in the Sand.

You may think it’s finally over – you found your dream home, your forever home or your long-dreamed-of beach house. But guess what, unless you have lots of cash in your checking account, you will have to apply for a mortgage.

There have been for many, many years two basic types of mortgages, the fixed-rate mortgage and the adjustable-rate mortgage or ARM. The fixed-rate mortgage is just that – your principal and interest payment are fixed for the life of the mortgage or until you sell the property and satisfy the mortgage balance. Fixed-rate mortgages give you a set amount of money every month to budget for and builds equity for a home that you feel will be a long-term purchase. Building equity will also give you the option of refinancing in the future if rates go down possibly resulting in a lower monthly mortgage payment.

Adjustable-rate mortgages are typically a fixed rate for a specific number of years, for example, 5 years, and then are adjusted annually either up or down. Generally, adjustable-rate mortgages start at a lower rate than a fixed rate, but you take the risk of monthly payments increasing substantially as the rates fluctuate after the fixed number of years has been reached.

Adjustable-rate loans could be a good choice if you’re planning on selling your home within a short period of time prior to when the fixed-rate term expires. However, this type of mortgage does not build much, if any, equity, a consideration in a real estate market that may be on the way down.

Whichever type of mortgage you choose, the amount of money you put down will influence the rate you are offered. A 20% or higher down payment will likely provide the best mortgage rates and the most options as well as substantially reducing the risk of the home not appraising.

Putting down between 5% and 19% will put you in the position of having to pay a higher interest rate and/or fees. In addition, lenders most likely will require private mortgage insurance (PMI). Private mortgage insurance is an insurance policy that allows you to make a lower down payment by insuring the lender against loss if you don’t make your mortgage payments. A lower down payment could be a good thing for buyers with little cash or if the home requires work and the cash to do it. PMI payments start going down after equity has built up in the home.

Finally, there are no-down-payment or small-down-payment loan programs which are more expensive but are an alternative. If you or someone in your family are trying to get into a home with little cash, they should research FHA loans or, if qualified, VA loans, both with low down payment options.

Two things you should try and avoid in-home financing are balloon payments and prepayment penalties. Balloon payments are a large payment required usually at the end of the loan repayment period with varying amounts based on the terms of the loan. Prepayment penalties are an amount required if you refinance, pay off your loan early or sell your home. And one nice little trick to help you pay off your mortgage sooner and build equity is to make extra payments during the course of the year.

Once you find the perfect mortgage and get through the mortgage qualifying maze, you’re ready to enjoy your perfect home; I hope for you, it’s the beach house.

More Castles in the Sand:

Is homeownership threatened?

Real estate market disruption

Fee-fi-fo-fum, do I smell a recovery?

Castles in the Sand

Order out of chaos

Written by Louise Bolger on . Posted in Business, Castles in the Sand.

Writing has been compared to bringing order out of chaos, something I try to do weekly on this page, and one of the most chaotic aspects of real estate is the mortgage process, which may be getting even more confusing to the average home buyer.

As confusing as the typical mortgage process is, the relationship of Fannie Mae, Freddie Mac, FHA and Ginnie Mae – entities that are also known as government-sponsored enterprises (GSEs) – to the mortgage market continually contribute to the chaos.

Before we go on, a quick review: Over 50 years ago Congress chartered the government-sponsored enterprises to provide liquidity to housing finance. The GSEs securitized and guaranteed mortgages, freeing up private lenders to provide more loans, making mortgages more readily available to the average home buyer. This created the 30-year, fixed-rate mortgage, which has been the gold standard of housing finance for all these years.

It was a great system until it went off the rails with sub-prime mortgage products partly encouraged by Congress leading to the bursting of the housing bubble and financial collapse in 2008. The American taxpayer was on the hook for $190 billion dollars to keep Fannie and Freddie floating and they have been in government conservatorship since then.

Now the federal government wants to gradually shrink the GSEs and start returning them to private hands. One of the suggested ways is to require them to have additional capital and underwriting standards comparable to private lenders. Will this happen? Maybe, but even if the wheels start to spin in that direction, it will be a long painful process which could turn on a dime subject to the outcome of a national election.

In the meantime, there is a new type of unconventional mortgage that has turned up. It’s called asset-depletion loans or asset-dissipation loans. Basically, they are designed for people who don’t have conventional paychecks, particularly retirees. As long as the borrower’s ability to draw on their assets is not overestimated, the loans can be fine.

Fannie Mae and Freddie Mac do make these loans but only based on a borrower’s 401k assets. However, Fannie and Freddie have eased up on standards for this type of loan, asking for smaller down payments and allowing more debt for borrowers. Again, this creates more risk for the American taxpayers.

So, what else do the gatekeepers of the American housing market have up their sleeve? Well, there is something that many Florida residents will be very interested in. Within the past year, they rolled out a program that would treat manufactured homes the same as it does site-built properties.

This means that a previous market that was difficult to obtain mortgaging for will now operate as a conventional mortgage market. They have also designed mortgages for manufactured homes at lower interest rates than buyers of these properties were previously able to obtain, as well as allowing appraisers to compare manufactured homes to those built on-site when determining value.

This may be a great program for many buyers of manufacturers homes, but in Florida, as we all know, manufactured homes are the most vulnerable in storms. Again, call me crazy, but do we as taxpayers need to assume more mortgage risk?

Fannie Mae and Freddie Mac, as well as all other GSE programs, will go on for a long time before any real change is made. It’s almost impossible to take away something that’s been in effect for so long. All I can do is try to bring order out of the mortgage processing chaos.

More Castles in the Sand:

Luxury ain’t what it used to be

The fun and not-so-fun of selling a home

The fun and not-so-fun of buying a home

Castles in the Sand

The condo dance

Written by Louise Bolger on . Posted in Business, Castles in the Sand.

Every dance has specific dance steps. Even though some dancers may look like they’re just winging it, they’re at least the ones that you keep looking at. Living in a condo requires learning a multiple of dance steps, so if you’re not good at condo dancing, you may need to rethink your purchase.

Condo living is great. It frees you of all the day to day maintenance issues that a house requires – exterior painting and pool cleaning are done, the lawn is mowed and roof repairs are a thing of the past. But all of these services come with a price in both money and control.

The first dance steps you need to learn are those in the condo maintenance fees or homeowner association fees dance. These fees are established in order to pay for all of the services and expenses the condo association is responsible for. Owners pay either a monthly or quarterly fee that goes into the association’s funds and is allocated to specific reserves.

As soon as you are in contract for a condo property, the condo fees are disclosed to you. You, in turn, need to disclose these fees to your lender if you are applying for a mortgage. Condo fees are calculated by lenders right along with principal, interest, taxes and insurance in order to qualify for financing.

Condos with high fees can kill a deal if the potential buyer does not qualify for a mortgage because of the fees. This can be a tricky calculation for condos that are new construction since it’s not uncommon for the developer to lowball common charges in order to sell units, which means that marginal buyers may not get their financing if the fees are adjusted upward prior to closing.

The second dance that has very complicated steps is the giving up control to the condo boards and management company dance. If you’re one of those people who needs to dot every “I” and question every rule, you may have a hard time learning this dance.

There’s a fair amount of freedom you give up to live in a condo. For instance, if you liked skinny dipping in your single-family home pool you better start buying a bunch of bathing suits or, if your neighbors on the other side of your common wall have their grandchildren over every Sunday to watch football, either you join the party or go out for the day. Condo living is nothing if not a compromise.

There is, however, a way to gain some control and that’s by volunteering to join the condo board. Based on how the condo documents are drawn up, condo board members have a lot of power. They can change rules, choose contractors to do jobs and move money around. There certainly are decisions the boards cannot make without a vote of the residents, so learning what decisions condo boards can and cannot make is important before going forward.

If you don’t join the board yourself, make sure you vote for board members that you feel are qualified and ethical. In addition, condo boards that have good management companies to advise and guide them are better run.

Successful condo living is a “live and let live” concept. Minor infractions of rules should be overlooked and flexibility will make your living experience rewarding. If you want a carefree lifestyle and the ability to lock your door and leave, like so many people in Florida do, condo living is a perfect fit. But first you need to learn the condo dance and how to dance like a pro.

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The suburbs and the millennials

Are you as smart as a private equity firm?

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