Budget-Friendly Landscaping Ideas

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A home with a gorgeous yard isn’t just easy on the eyes: Well-landscaped homes also sell for 5.5% to 12.7% more, according to research at Virginia Tech. Only problem is, professional landscaping costs an average of $3,219, according to HomeAdvisor.com. But pros aren’t the only way to go. Here’s proof: seven cheap landscaping ideas that provide all the lush greenery you need without your gushing greenbacks.

27 Front Yard Landscaping (Fresh New Ideas) Part 8 - YouTube

Show your lawn a little TLC

While overgrown plants and weeds can make a home look run-down, a well-manicured lawn signals to prospective home buyers that the house is maintained well inside as well. So start by cutting the grass, trimming shrubs, and pruning hedges.

Buried in weeds? Cherie Lowe, blogger and author of “Slaying the Debt Dragon,” recommends a homemade weed killer: Mix white vinegar, 1 to 2 cups of salt (table or Epsom), and a small squeeze of dish detergent.

“It takes one to two days for it to activate, killing off unwanted weeds, and costs a fraction of the price,” Lowe says.

Install drought-tolerant plants

One-third of all household water use typically goes to landscaping, according to the Environmental Protection Agency. It’s no surprise, then, that sustainable design (i.e., yards that require low maintenance and less water) is one of the hottest trends in residential landscaping, according to a recent survey by the American Society of Landscape Architects.

Don’t want to spend thousands of dollars on a new irrigation system? Invest in some easy-care, drought-tolerant plants such as coneflowers, lantanas, or yarrows. Their ability to survive in dry conditions and minimal need for water can be nice selling points to home buyers. Easier for you, too.

Find free mulch

Laying down fresh mulch in a flowerbed or around the base of trees can make a yard instantly more appealing. Not only does this layer of bark and compost enrich the soil, it also looks far nicer than bare dirt. Sadly, purchasing mulch can drag down your budget. Even if you buy it in bulk, mulch costs between $15 and $65 per cubic yard.

But why pay for mulch when you can get it for free?

Many cities offer free mulch to residents, says Sarah Hutchinson at LandscapingNetwork.com. Check with your local government to see if there’s a program available in your area. You’ll need to rent your own truck if you want to load up, but doing so is another way to cut your landscaping expenses, since mulch delivery can cost between $354 and $1,093. (Note: You may need to take a utility bill with you to the distribution center to prove that you live within the city limits.)

Use gravel instead of concrete

Concrete—for driveways and sidewalks—may be the go-to for many homeowners, but it’s also expensive, costing $98 per cubic yard. So go for the cheaper option of pea gravel, which costs drastically less, at $30 to $35 per cubic yard. Even cheaper? Hutchinson likes decomposed granite, which costs only about $3 to $5.

Buy plants in bulk

While you don’t need a wide array of foliage to make your landscaping shine, a select few can do wonders and save you cash.

“By choosing three (varieties of) plants for your garden instead of 10, you can buy in bulk and often save money,” Hutchinson points out. NatureHills.com, for example, frequently offers discounts of 15% to 30% on the purchase of five or more of the same plant.

Brighten up lighting

Many home buyers schedule viewings at night, since they work during the day. Therefore, you need to be mindful of how your home’s exterior appears at night. We’re not saying that you need to hire a contractor to install an outdoor lighting system, which HouseLogic.com estimates can cost on average $4,925. Just make sure that all of the current light fixtures have working lightbulbs. For optimal brightness, use lightbulbs with the highest wattage possible (based on safety guidelines).

The caveat: Keeping the outdoor lights on at night will bump up your electric bill; however, having a well-lit exterior will help your house make a great first impression. Put simply, it’s worth the extra expense.

Hire a landscaper for free

Landscape architects typically charge $70 to $150 an hour. However, many local garden centers provide landscaping consultations for free or for a small additional cost if you buy plants from them. In other words, you may not need to pay a penny to get landscaping advice from a professional.

 

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Fact or Fiction? 6 Down Payment Myths You Should Stop Believing Immediately

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If you’re thinking about buying your first home, that pesky down payment has probably kept you awake more than a few nights. We get it—while a pre-approval is crucial for determining your buying power, it’s the down payment that shows you mean business.

But saving up is hard. In a study conducted by NerdWallet, 44% of respondents said a lack of a down payment was the roadblock keeping them from buying a home.

Making things even worse? Your well-meaning friends and family have probably given you at least one piece of well-meaning, but ill-informed advice, leaving you in more of a blind panic than you need to be.

We’re not saying that saving for a down payment will be a cake walk, but separating fact from fiction can go a long way. Here’s the truth you need to know.

6 Steps Before You Fund Your Child's Home Down Payment - Law Offices of Daniel Timins

Myth No. 1: You need 20% down

In the NerdWallet study, 44% of respondents also believed you need 20% (or more) down to buy a home. For decades, this was standard, but it isn’t always the case anymore.

“It really depends on the type of buyer you are,” says Robert Garay, a broker associate and team leader of the Garay Group at Lifestyle International Realty in Miami.

For instance, a Federal Housing Administration (FHA) loan only requires 3.5% down. If either you or your spouse served in the military, you’re likely to be eligible for a Veterans Affairs (VA) loan, which can be approved for 0% down. The same goes for United States Department of Agriculture (USDA) loans.

And if you’re a qualified buyer, you can get approved for a conventional loan with less than 20% down, but there’s a catch: You’ll be on the hook for private mortgage insurance, or PMI. PMI is paid directly to your lender, not toward your principal. Think of it essentially as insurance you pay to prove to the lender you won’t default on your loan.

Myth No. 2: Paying mortgage insurance is smarter than paying a bigger down payment

Perhaps that mortgage insurance seems like a small price to pay in order not to deplete your bank account and win the house. So what if you make some additional payments for a while?

It might not be a big deal, but you’ll want to calculate what you’ll pay in the long run. Take, for example, conventional loans. If you put less than 20% down, you’ll get stuck with PMI, but only until the principal balance reaches 78% or less of the original purchase price.

FHA loans, on the other hand, require mortgage insurance for the life of the loan. That means you’ll be paying an extra monthly fee for as long as you live in the home (or until you pay off the mortgage).

Before you brush off mortgage insurance, compare your options—and know that paying less upfront could mean paying much more over the life of your loan.

Myth No. 3: Cash is king

If you’re shopping in a competitive market, you’ve likely heard horror stories about first-time buyers getting snubbed over investors or all-cash buyers. If you’re working with a loan and a small amount down, it might seem like your chances of getting picked over the other guys are slim to none.

There is some truth to this belief. Cash offers offer one big benefit to a seller: They’re guaranteed to close on time with no loan approval hiccups.

But on the flip side,“That myth assumes that sellers care most about a fast and certain close, and that’s not always true,” says Casey Fleming, mortgage adviser and author of “The Loan Guide: How to Get the Best Possible Mortgage.”

Often, if you make the bigger offer, or you write a killer personal letter that resonates with the seller, you stand a better chance of getting approved over an all-cash offer.

Fleming’s seen it happen: “I’ve actually beat out all cash offers with 10% down because our offer price was a little higher,” he says. “I’ve also had deals where we were competing against a higher cash offer and the seller took ours because the buyers were a young family wanting to raise their kids in the home—and that meant something to the seller.”

Myth No. 4: Down payment assistance is easy!

We hate to burst your bubble—or discourage you from trying to get down payment assistance if you qualify—but finding, applying, and getting approved for help isn’t always easy.

First, there are no national, or even many state-run, assistance programs.

“Pretty much every program is locally run, sometimes by county or even by city,” Fleming says. You can check the Department of Housing and Urban Development’s website for a smattering of state-run “homeowner assistance” options, but you’ll have to do some digging.

And then there’s the other rub. “You have to be under a certain income to qualify, usually the median income in the county,” Fleming says.

Some programs may make special exceptions—say, for single parents—but in general, income is going to be a big factor.

For example, to be eligible for down payment assistance in Grand County, CO, applicants must work a minimum of 32 hours per week in the area and meet income limits. Nevada’s “Home Is Possible Down Payment Assistance Program” has a cap on income, credit score requirements, and the cost of the home bought. In Tamarac, FL, applicants must meet income requirements, wait until an open enrollment period and then get picked from a lottery system.

Still, if you think you might qualify, call your local housing authority office—it can usually point you in the right direction.

Myth No. 5: You shouldn’t put more than 20% down

Let’s say you’re lucky enough to have saved more than 20% down. Odds are good some well-meaning friend is going to tell you to put only 20% down—no more, no less. After all, now that you’ve successfully avoided PMI, why fork over more cash than you have to?

A couple of reasons, Fleming says: First, a higher down payment could signal to your lender that you’re a trustworthy borrower and get you a lower interest rate on your mortgage. Plus, the more you pay upfront, the less you’re borrowing—which means lower mortgage payments.

But you’ll have to put down at least 5% more to see that difference, according to Fleming.

“Your interest rate drops a little more with 25% down, and even more with 35% down,” he says.

Compare your options to see if it makes more sense to pay the extra down or to keep that money in investments that can work for you.

Myth No. 6: You can take out a loan for a down payment

Truth: There’s nothing wrong with getting help with your down payment, but it has to be a gift. If a lender suspects the money might be a loan, repaying said loan will be factored into your mortgage approval amount and you’ll qualify for less than you might have wanted.

In order to prove it’s a gift, you’ll have to get a letter from the gifters, swearing that they don’t plan on asking for the money back. And don’t try to game the system—lying on a mortgage application is a felony.

 

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What Is a Buyer’s Agent? A Trusted Guide Who’ll Help You Find a Home

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Ready to house hunt? It’s a jungle out there: Prepare for a flurry of paperwork, stampedes of buyers competing for the same digs, and other challenges, before you get your hands on those house keys.

We won’t lie: The process can be complex and stressful—especially if you are a first-time buyer. Having a real estate pro by your side can make all the difference.

You might have heard of buyer’s agents, selling agents, listing agents, and so on. You’re a buyer, so what is a buyer’s agent?

True to their name, buyer’s agents help real estate buyers navigate the real estate market; they can also save you tons of time and money on the road to your new home.

What Is a Buyer’s Agent? A Trusted Guide Who’ll Help You Find a Home

Buyer’s agent vs. Realtor: Benefits of using a buyer’s agent when buying real estate

“A buyer’s agent will guide you through the home-buying transaction and be at your disposal for any questions or concerns,” says Shane Wilcox, a Realtor® with Partners Trust. Here are some of the things a buyer’s agent can do:

  • Find the right property. After determining what the clients are looking for and what they can afford, the agent will schedule appointments to tour homes that fit the bill. The agent can also explain the ins and outs of various properties and neighborhoods, to help buyers decide which home is right for them, by explaining the pros and cons of various options.
  • Negotiate the offer. The buyer’s agent will advise clients on an appropriate price to offer and present it to the seller’s agent. “Then they will negotiate on your behalf and write up the contracts for you,” says Matt Laricy, a Realtor with Americorp Real Estate in Chicago. This is where the agent’s experience in negotiating deals can save you money and help you avoid pitfalls like a fixer-upper that’s more trouble than it’s worth.
  • Recommend other professionals. A buyer’s agent should also be able to refer you to reliable mortgage brokers, real estate attorneys, home inspectors, movers, and other real estate professionals. This can also help expedite each step of the process and move you to a successful real estate sale all the faster.
  • Help overcome setbacks. If the home inspector’s report or appraisal brings new issues to light, a buyer’s agent can advise you on how to proceed with the transaction, and then act as a buffer between you and the sellers or their broker. If negotiations become heated or hostile, it’s extremely helpful to have an experienced professional keeping calm and offering productive solutions.

Buyer’s agent vs. listing agent: What’s the difference?

Buyer’s agents are legally bound to help buyers, whereas listing agents—the real estate agent representing the home listing—have a fiduciary duty to the home seller.

“That’s why it’s in your best interest as a buyer to get an agent who is there to represent you,” explains Alex Cortez, a Realtor with Wailea Village Properties in Kihei, HI.

“Think about it this way: If you were getting sued, would you hire the same attorney as the person suing you? Of course not. You need someone who will diligently fight for your interests and rights.”

Let’s say, for instance, you walked up to the listing agent at an open house. You might gush about how you love the home and want to buy it, but add that you will need to move soon—because you’re expecting your second child and need to decorate the nursery, pronto, or because the lease on your rental is up in a couple of months.

A seller’s agent could then use this information against you by informing the sellers that your clock is ticking, so they shouldn’t budge too much on their asking price—if at all.

Yet make this same confession to the buyer’s agent you’re working with, and it’s all fine—this professional would know to keep this info private from sellers (and their agents), so it can’t be used against you.

Some states, recognizing this problem, required a disclosure of dual agency when a broker represents both sides of a real estate transaction.

However, you may still not be comfortable after signing an agreement saying you know someone is a double agent. You might want to hire an agent who is not representing the owner, and who is looking out for your best interests.

How to find a buyer’s agent

A good buyer’s agent can ease your way to homeownership—and a bad one can result in a bumpy ride.

You should not just take the first buyer’s agent you meet (as two-thirds of home buyers do), or blindly accept the recommendation of a friend (more than half do this). Instead, it’s best to interview at least three agents and ask them a few questions, including the following:

  • What neighborhoods do you specialize in? Real estate requires local expertise, so you should find an agent who’s extremely familiar with the areas you’re interested in.
  • What’s your schedule and availability? Part-time real estate agents who are committed can do a fine job, but if the house of your dreams pops up or you encounter last-minute closing snafus, you want an agent who will be readily reachable.
  • How long have you been a real estate agent? You ideally want someone with a couple of years of experience, and a proven track record of selling homes.

The agent/buyer contract

Once you agree to work with someone, you will have to sign a contract called an “exclusive buyer agency agreement,” outlining the agent’s services and compensation (more on that next).

This contract also means that this person will be your sole representative and that you won’t work with other buyer’s agents.

Who covers the buyer’s agent commission

Home buyers don’t need to worry about the expense of hiring a buyer’s agent. Why? Because the seller pays the commission for both the seller’s and buyer’s agents.

 

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How Much Are Closing Costs? Plus: How to Avoid Closing Costs

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Whether you’re a first-time homebuyer or have purchased property before, if you get a mortgage to buy a home, you’ll have to pay closing costs. These fees, paid to third parties to help facilitate the sale of a home, typically total 2% to 7% of the home’s purchase price. So on a $250,000 home, you can expect the amount to run anywhere from $5,000 to $17,500.

Now that you have a sense of the ballpark numbers, here’s everything homebuyers and home sellers need to know about closing costs—from why closing costs are so high to who pays closing costs and even how to get closing costs waived.

Who pays closing costs and Realtor fees, and when?

After saving up to purchase a new home, getting pre-approved, and making a down payment, it’s hard for buyers to accept that they’ll have additional out-of-pocket expenses. Some good news, then, is that both buyers and sellers typically pitch in to cover closing costs, although buyers shoulder the lion’s share of the load (3% to 4% of the home’s price) compared with sellers (1% to 3%). And while some expenses must be paid upfront before the home is officially sold (e.g., the home inspection fee when the service is rendered), and others, like property taxes and homeowners insurance, are recurring, most are paid at the end, when you close on the home and the keys exchange hands.

How Much Are Closing Costs? Plus: How to Avoid Closing Costs

What can buyers expect to pay?

Who pays closing costs and Realtor fees? Homebuyers pay the majority of these costs, since many of these fees are associated with the mortgage.

“If you’re paying cash for a property, there are still a few closing costs, but they are significantly less,” says Cara Ameer, a Realtor® in Ponte Vedra, FL.

Here are some of the fees homebuyers should brace themselves to pay:

  • A loan amount origination fee, which lenders charge for processing the paperwork for your loan.
  • A fee for running your credit report.
  • A fee to underwrite and assess your credit worthiness.
  • A fee for the appraisal of the home you hope to own to make sure its value matches the size of the loan you want.
  • A fee for the home inspection, which checks the home for potential problems from cracks in the foundation to a leaky roof.
  • A fee for a title search to unearth any liens on the property that could interfere with your ownership of it. Title insurance protects the lender and buyer from claims against the home and property.
  • A survey fee if it’s a single-family home or town home (but not condos)
  • Taxes, also called stamp taxes, on the money you’ve borrowed for your home loan.
  • Private mortgage insurance is an additional fee that buyers can expect to pay if they can’t come up with a down payment that’s 20% of the purchase price.
  • Discount points, or mortgage points, are fees paid right to the mortgage lender in exchange for a lower interest rate. One point is valued at 1% of your mortgage total. It may seem like lot to pay upfront, but doing so will lower your monthly mortgage payment.
  • One-time fees may also include: document recording fees for the deed and mortgage, buyers’ attorney fees, real estate agent commission.

Buyers should also account for the following:

  • An escrow deposit, managed by a neutral third-party escrow officer, covering typically two months of prepaid property taxes and mortgage insurance payments

How much can sellers expect to pay?

Here are the fees that sellers are typically responsible for:

  • A closing fee, paid to the title insurance company or attorney’s office where everyone meets to close on the home
  • Taxes on the home sale
  • A fee for an attorney, if the home seller has one
  • A fee for transferring the title to the new owner

While this doesn’t seem like much compared with what future homeowners have to cough up, keep in mind that sellers typically pay all real estate agents’ commissions, which amount to 4% to 7% of the home’s sales price. So, no one sneaks through a home closing scot-free.

Why there’s no such thing as typical closing costs

The reason for the huge disparity in closing costs boils down to the fact that different states and municipalities have different legal requirements—and fees—for the sale of a home.

“If you live in a jurisdiction with high title insurance premiums and property transfer taxes, they can really add up,” says David Reiss, research director at the Center for Urban Business Entrepreneurship at Brooklyn Law School. “New York City, for instance, has something called a mansion tax, which adds a 1% tax to sales that exceed $1 million. And then there are the surprise expenses that can crop up, like so-called ‘flip taxes’ that condos charge sellers.”

Texas has the highest closing costs in the country, according to Bankrate.com. Nevada has the lowest.

Closing cost calculator: How to estimate closing costs

To estimate these, plug your numbers into an online closing cost calculator, or ask your real estate agent, lender, or mortgage broker for a more accurate estimate. Then, at least three days before closing, the lender is required by federal law to send buyers a closing disclosure that outlines those costs once again. (Meanwhile, sellers should receive similar documents from their real estate agent, outlining their own costs.)

Word to the wise: “Before you close, make sure to review these documents to see if the numbers line up to what you were originally quoted,” says Ameer. Errors can and do creep in, and since you’re already ponying up so much cash, it pays, literally, to eyeball those numbers one last time before the big day.

The best ways to avoid closing costs

While there’s no way for you to outright dodge these fees, there are ways that homeowners can pay vastly less.

Some closing costs are negotiable: attorney fees, commission rates, recording costs, and messenger fees. Check your lender’s good-faith estimate (GFE) for an itemized list of fees. You can also use your GFE to comparison shop with other lenders.

Here are some ways to circumvent the added expenses:

1. Look for a loyalty program. Some banks offer help with their closing costs for buyers if they use the bank to finance their purchase. Bank of America, for instance, offers reduced origination fees for “Preferred Rewards” members. It’s the bank’s way of offering a reward for being a customer.

2. Close at the end the month. One of the simplest ways for you to reduce your closing costs as a buyer is to schedule your closing at the end of the month. If you close at the beginning of the month, say March 6, you have to pay the per diem interest from the 5th to the 30th. But if you close on the 29th, you pay for only one day of interest.

3. Get the seller to pay. Most loans allow sellers to contribute up to 6% of the sale price to the buyer as a closing-cost credit. It’s a way to seal the deal—and a tax-deductible expense for the seller. Don’t expect this to happen much in hot markets where inventory is scarce (which is almost everywhere these days).

4. Wrap the closing costs into the loan. You’re already borrowing probably hundreds of thousands of dollars—why not tack on a few thousand more? Mortgage lenders charge more for this, but if you don’t have the cash, it’s a way to get into the house with less cash upfront. You may want to consider a no closing cost mortgage. With this type of mortgage loan, the lender covers the fees, but you’ll be paying a higher interest rate for the duration of the loan, which will mean larger mortgage payments.

5. Join the army. Military members have closing-cost benefits that are often overlooked. Service members and veterans may qualify for funds to help them purchase a home. These benefits are not limited to the VA loan. The key is to do the necessary research to make sure you get everything you are entitled to. Visit usmhaf.org for more information.

6. Join a union. AFL-CIO members can get help purchasing or refinancing a home with closing-cost discounts and rebates from the Union Plus Mortgage program.

7. Apply for an FHA loan. Americans with lower incomes can apply for an FHA (Federal Housing Administration) loan, a government-backed mortgage. Buyers can get a bit of help from interested third parties including real estate agents, sellers, and mortgage brokers, who can pay up to 6% of the new loan amount. FHA loans are also a bit more lax on credit scores. Borrowers whose credit score is 580 or higher are likely to qualify, whereas traditional lenders require a credit report to reflect 620 or higher.

 

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What Is a Good Credit Score to Buy a House?

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If you’re hoping to buy a home, one number you’ll want to get to know well is your credit score. Also called a credit rating or FICO score (named after the company that created it, the Fair Isaac Corporation), this three-digit number is a numerical representation of your credit report, which outlines your history of paying off debts.

Why does your credit score matter? Because when you apply for a mortgage to buy a home, lenders want some reassurance a borrower will repay them later! One way they assess this is to check your creditworthiness by scrutinizing your credit report and score carefully. A high FICO rating proves you have reliably paid off past debts, whether they’re from a credit card or college loan. (Insurance companies also use more targeted, industry-specific FICO credit scores to gauge whom they should insure.)

In short, this score matters. It can help you qualify for a home, a car loan, and so much more. Which brings us to an important question: What type of score is best to buy a house?

Inside your credit score: How does it stack up?

A credit score can range from 300 to 850, with 850 being a perfect credit score. While each creditor might have subtle differences in what they deem a good or great score, in general an excellent credit score is anything from 750 to 850. A good credit score is from 700 to 749; a fair credit score, 650 to 699. A credit score lower than 650 is deemed poor, meaning your credit history has had some rough patches.

While FICO score requirements will vary from lender to lender, generally a good or excellent credit score means you’ll have little trouble if you hope to score a home loan. Lenders will want the business of home buyers with good credit, and may try to entice them to sign on with them by offering loans with the lowest interest rates, says Richard Redmond at All California Mortgage in Larkspur and author of “Mortgages: The Insider’s Guide.”

Since a lower credit score means a borrower has had some late payments or other dings on their credit report, a lender may see this consumer as more likely to default on their home loan. All that said, a low credit score doesn’t necessarily mean you can’t score a loan, but it may be tough. They may still give you a mortgage, but it may be a subprime loan with a higher interest rate, says Bill Hardekopf, a credit expert at LowCards.com.

What Is a Good Credit Score to Buy a House?

How a score is calculated

Credit scores are calculated by three major U.S. credit bureaus: Experian, Equifax, and TransUnion. All three credit-reporting agency scores should be roughly similar, although each pulls from slightly different sources. For instance, Experian looks at rent payments. TransUnion checks out your employment history. These reports are extremely detailed—for instance, if you paid a car loan bill late five years ago, an Experian report can pinpoint the exact month that happened. By and large, here are the main variables that the credit bureaus use to determine a consumer credit score, and to what degree:

  • Payment history (35%): This is whether you’ve made debt payments on time. If you’ve never missed a payment, a 30-day delinquency can cause as much as a 90- to 110-point drop in your score.
  • Debt-to-credit utilization (30%): This is how much debt a consumer has accumulated on their credit card accounts, divided by the credit limit on the sum of those accounts. Ratios above 30% work against you. So if you have a total credit limit of $5,000, you will want to be in debt no more than $1,500 when you apply for a home loan.
  • Length of credit history (15%): It’s beneficial for a consumer to have a track record of being a responsible credit user. A longer payment history boosts your score. Those without a long-enough credit history to build a good score can consider alternate credit-scoring methods like the VantageScore. VantageScore can reportedly establish a credit score in as little as one month; whereas FICO requires about six months of credit history instead.
  • Credit mix (10%): Your credit score ticks up if you have a rich combination of different types of credit card accounts, such as credit cards, retail store credit cards, installment loans, and a previous or current home loan.
  • New credit accounts (10%): Research shows that opening several new credit card accounts within a short period of time represents greater risk to the lender, according to myFICO, so avoid applying for new credit cards if you’re about to buy a home. Also, each time you open a new credit line, the average length of your credit history decreases (further hurting your credit score).

How to check your credit score

So now that you know exactly what’s considered a good credit rating, how can you find out your own credit score? You can get a free credit score online at CreditKarma.com. You can also check with your credit card company, since some (like Discover and Capital One) offer a free credit score as well as credit reports so you can conduct your own credit check.

Another way to check what’s on your credit report—including credit problems that are dragging down your credit score—is to get your free copy at AnnualCreditReport.com. Each credit-reporting agency (Experian, Equifax, and TransUnion) may also provide credit reports and scores, but these may often entail a fee. Plus, you should know that a credit report or score from any one of these bureaus may be detailed, but may not be considered as complete as those by FICO, since FICO compiles data from all three credit bureaus in one comprehensive credit report.

Even if you’re fairly sure you’ve never made a late payment, 1 in 4 Americans finds errors on their credit file, according to a 2013 Federal Trade Commission survey. Errors are common because creditors make mistakes reporting customer slip-ups. For example, although you may have never missed a payment, someone with the same name as you did—and your bank recorded the error on your account by accident.

If you discover errors, you can remove them from your credit report by contacting Equifax, Experian, or TransUnion with proof that the information was incorrect. From there, they will remove these flaws from your report, which will later be reflected in your score by FICO. Or, even if your credit report does not contain errors, if it’s not as great as you’d hoped, you can raise your credit score. Just keep in mind, regardless of whatever credit-scoring model you use, you can’t improve a credit score overnight, which is why you should check your credit score annually—and improve your credit score—long before you get the itch to score a home.

 

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Is Your Home Energy-Efficient? 8 Red Flags That’ll Drain Your Wallet and Destroy the Earth

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Going green feels good, which is why we recycle cans and fill up reusable water bottles. Still, much bigger and pricier waste might be sailing right out your doors and windows if the home you’re in (or hope to buy) isn’t energy-efficient.

Truth is, old houses are notoriously expensive to heat and cool, but even newer construction could have design flaws that make them less energy-efficient, too. And since no one wants high electric bills, we’ve polled experts in the field to help you spot the signs that a home isn’t as green as it could be—and what to do to fix it.

Whether you’re shopping on the open market for a house or simply looking for some eco-friendly home improvements for where you live, heed this list to keep more money in your pocketbook.

1. Cold walls and doors

If you can see light under doors and feel drafts through windows, you’re dealing with low efficiency in the house.

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“If you can see light under doors and feel drafts through windows, you’re dealing with low efficiency in the house,” says Caroline Kalpinski, a real estate agent with Sotheby’s International in Asheville, NC.

But if the house you’re touring is an antique and old walls are part of its charm and character, you might be willing to look past this flaw.

Still, to live comfortably and not shell out hundreds in energy bills, “getting new insulation and weatherstripping can alleviate drafts and cracks in less efficient homes,” she adds.

2. Single-pane windows

Single-pane windows, even tightly sealed, won’t provide much insulation.

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Tightly sealed windows and doors help a great deal, but if the glass is single pane, you’ll still feel a chill.

“Generally speaking, single-pane windows won’t provide a lot of insulation, so you’ll definitely be able to feel the cold,” explains Erica Dodds, chief operating officer of the Foundation for Climate Restoration and an expert on sustainability.

And if these thin windows are in an older home, it’s a double whammy because “older houses tend to breathe more, making them less energy-efficient,” says Dodds.

3. Old appliances

Energy Star criteria have only improved over the years, so newer appliances will be substantially better.

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Stoves and fridges from 1992 or earlier won’t have the Energy Star standards applied to them and are considered ineffective energy users.

“Energy Star criteria have only improved over the years, so newer appliances will be substantially better,” says Dodds.

Still, there’s no need to toss a perfectly good dishwasher if it’s still working, add Dodds, so “wait for the appliance’s life cycle to come to a close and then purchase an Energy Star–rated version.”

4. Dusty AC vents

Dust around air-conditioning vents isn’t a housekeeping issue, but an energy problem.

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Nope, dust around air-conditioning vents isn’t a housecleaning issue; it’s an energy problem. In an ideal world, the AC vents you see should be sealed tight, with no dust coming in or out. But streaks around the vents likely indicate the unit isn’t working properly thanks to leaky ducts—and you’re losing cool air in the process.

5. Rusty compressors

An old AC system might have visible rust on the components.

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The AC compressor is usually hidden outside the house behind a fence or some bushes, but a wise prospective buyer will seek it out.

The reason? An out-of-date system might have visible rust on the components.

“It could look worn on the outside,” says Kalpinski, “and if water is under it, it typically means the system is older and has leaks.”

6. Ice dams

If your roof is forming ice dams, it means it’s not well-insulated.

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The prospect of ice building up in big patches on the roof is kind of scary. (What if it falls on someone’s head?). It’s also a sign of energy inefficiency since it means you’re losing heat through the roof.

“If your roof is forming ice dams, it means it’s not well-insulated and you could probably use a gutter cleaner, too,” says Curtis Tongue, an energy expert and co-founder of OhmConnect.

7. Signs of rodents

Look for signs of chewing and droppings around the house.

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While you probably won’t see actual mice running around at an open house (fingers crossed!), it’s smart to check for signs of rodents and other creepy-crawlies.

“A home that’s not weatherized will see a significant uptick in pests during the summer and winter, so check inside the pantry or cabinets in the kitchen,” suggests Tongue.

Look for signs of chewing and droppings, say the experts.

“Poor insulation is easy to nest in and make tunnels, so access to the home is easier as well,” adds Kalpinski.

8. No HERS score

HERS is a nationally recognized metric that quickly tells you whether a home is energy-efficient.

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“HERS stands for ‘Home Energy Rating System,’ and it’s a nationally recognized metric that quickly tells you whether a prospective home is energy-efficient,” explains Tongue.

You can ask the broker you’re dealing with if the home you’re touring has a rating.

“And be sure to find out when the last major renovation was and whether it included insulation,” he adds.

 

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Do You Need a Realtor for New Construction? Here’s Everything to Know

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Have you ever wondered, “Do I need a Realtor for new construction?” After all, when you’re house hunting, the allure of new construction is undeniable. You get to be the first to live in the pristine home—one untouched by grimy hands or muddy shoes. It’s full of brand-new appliances and the finishes and treatments that you picked to fit your aesthetic. And you won’t have to worry about making any cosmetic or structural upgrades for years.

If you are interested in buying a new construction, the builder’s agent will be ready to help you with the process. But make no mistake: You need your own real estate agent from the get-go. Even if it seems like plug and play to sign up with the builder’s on-site agent, you’re going to want someone representing your side of the deal.

Do You Need a Realtor for New Construction? Here’s Everything to Know

Using a Realtor for new construction: What is a builder’s agent?

When you buy a new construction, the home’s builder is considered the seller, and the agent representing the builder is called the builder’s agent.

“The builder’s agent will always have the builder’s best interest in mind,” says real estate agent Jason Walgrave, with Re/Max Advantage Plus, in Lakeville, MN.

After all, the job of the builder’s agent is to get the highest price for the homes the builder is selling so the agent is not going to be as eager to negotiate down.

Why you should hire a Realtor for new construction

It’s a good idea to have your real estate agent accompany you on your first visit to the new construction. Why? Because the builder (aka the seller) will be responsible for paying the commission, and needs to know if you’ll have a real estate agent representing you. So bringing your agent to the first visit will make it clear that the builder’s agent will be on the hook for paying commission. Some builders might even refuse to pay your agent a commission if you don’t register the agent the first time you visit the home on a new construction site.

“Your real estate agent’s job is to help you get the most value for your money, with the least hassle and frustration,” says Patrick Welsh, a real estate agent with Keller Williams, in Houston.

When buying new construction, here’s what your real estate agent will help you with that you might miss out on if you stick with the builder’s agent:

  • Negotiating extras: Want upgraded counters or appliances in that new home? Your agent can help you with all those extra perks, amenities, and upgrades. “We can often negotiate with the builder on things like paint color or even the style of garage door, especially if the housing development is in the beginning stages,” Walgrave says.
  • Recommending financing: A builder typically will have a “preferred” lender that it will try to steer you to, but your real estate agent can help make sure that you’re getting the mortgage that works best for your situation. Shopping around is always wise, and you don’t want the builder’s agent pressuring you into using their suggested professional unless it’s right for you.
  • Overseeing a home inspection: Tempted to forgo a home inspection in new construction? Don’t do it, advises Welsh. “The number and severity of new-home defects often rival resale home problems,” he says.The builder’s agent is unlikely to push for or offer up an inspection, so it’s up to you and your real estate agent to make it happen.

How the builder’s agent can help you

All that said, the builder’s agent can be a valuable resource for learning about your potential new home.

“They are knowledgeable about the construction and available amenities, as well as the housing development and general community vibe,” says Walgrave. You can rely on the builder’s agent for background information—just don’t make this individual your sole point of contact on the buying and selling process.

Everyone wants to walk away from buying a home—whether it be a new construction or not—with peace of mind. Having a real estate agent in your corner will help facilitate that.

 

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Hands Off: What Stays With a House When You Sell It?

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When standup comedian Nathan Brannon moved into his newly purchased home in rural Washington state, it seemed the joke was on him: The previous owner had left the pegboard on the garage wall, but had taken all the pegs.

“When I first saw the pegs were missing, I was super confused; I mean, what are you going to do with just pegs?” Brannon recalls. “Now I have a pile of yard tools on the floor in front of the pegboard.”

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“What do I have to leave when I sell my house?”

Brannon isn’t the only home buyer to discover that sellers sometimes take the strangest things with them when they vacate a property. We’ve seen home buyers ranting on social media about missing doorknobs, toilet paper holders, and even trees from the front yard.

But it can be far beyond merely annoying for the buyer. If you take something you haven’t negotiated to keep, you could tank the sale—or even face a lawsuit.

Not sure what you’re allowed to take with you when you move? Here are some rules to keep in mind before—and after—closing the deal.

1. If it’s nailed down, bolted, or mounted, it probably stays behind

When Laurel-Ann Dooley walked through a vacation property she was purchasing, there was a glaring hole where a storage shed had recently stood.

“The previous owner had sold it, even though it was supposed to stay,” recalls Dooley, who’s an attorney and Realtor® at PalmerHouse Properties in Atlanta.

While most buyers and sellers probably know that “fixtures”—immovable elements of a home such as built-in furniture, fences, or, yes, a storage shed—must stay behind, there can still be some confusion, says Bill Gassett, a Realtor® with Re/Max Executive Realty in Hopkinton, MA.

“Probably the No. 1 gray area that I’ve found is the mounting mechanism for big-screen TVs,” Gassett shares. “Obviously, it’s attached, so it’s supposed to stay with the house. But commonsense says, ‘Well, if somebody has a $3,000 TV hanging on the wall, unless they’re including [the TV] with the house, [the mounting mechanism] doesn’t stay.’”

“It becomes a real battling point with buyers and sellers if it’s not specifically referenced,” he adds.

Generally, Dooley says, if a house has been modified for an item, it’s probably a fixture.

“If an air-conditioning unit is placed in a window, it’s arguably personal property and the buyer can take it with them,” she says. “But if a hole has been cut in the wall to accommodate the unit, then it’s most likely a fixture.”

With that said, you want to avoid “arguably”, “probably”, or “most likely” when it comes to selling your home, Dooley cautions. Be specific and firm.

“If you want it, say so upfront,” Dooley advises.

2. Leave Mother Nature alone

Unless the property listing specifically mentions that you intend to take the prized rose patch your Aunt Zelda gave you, sellers cannot remove any landscaping, Gassett says.

“I’ve had sellers with specific requests to take certain things that might have been a special gift,” Gassett says. “Otherwise, you can’t just dig up a plant and take it with you; it’s part of the property.”

3. Hands off anything anchored in the ground

Other backyard items are also potential sources of misunderstanding between buyers and sellers.

“Technically, if a basketball hoop is cemented into the ground, then it’s considered to go with the house. Freestanding ones sitting on the lawn, however, would be something buyers could take with them,” he says.

Ditto for swing sets: If it’s anchored in the ground, it stays.

4. Let go of your lighting fixtures

Even if you’re attached to your show-stopping dining room chandelier, don’t pack it up and leave electrical wires hanging when you leave. And if you’re thinking about swapping out that chandelier right before closing—and hoping the buyer won’t notice? Forget about it, Gassett says.

“When you buy a property, you’re buying what you saw the day you saw the property and wrote the offer on the house, so for sellers to change something out after that date is illegal,” Gassett warns. Yes—illegal. 

You can declare your intention to remove it, Dooley says, but be aware that excluded items often become sticking points between buyers and sellers.

“Instead, take that chandelier out before you list your house, and put something else there,” she suggests.

5. Do you leave curtains when you move? Yep, window treatments stay, too

You may have spent a fortune on those custom blinds in your living room, but technically, you’re supposed to leave ‘em hanging, Gassett says.

“Curtains are always considered personal property, because they just slide off,” he says. “Rods and blinds, on the other hand, are considered part of the house because they’re affixed and attached.”

Mirrors are another murky area, he adds, but pretty easy to figure out: If they’re hung like paintings on a wall, they’re personal property. Bolted to the studs? They’re fixtures.

Don’t be petty—or you might tank the sale

Often, the littlest things cause the most heated debates, or even the derailment of the sale itself.

Sometimes, as in Brannon’s case of the missing pegs, sellers remove things from the house that aren’t worth chasing after, but are incredibly annoying nonetheless, Gassett says. For instance, he recalls a seller who took the control box for an underground dog fence.

“In real estate deals, some people take it out on the buyer by nickel-and-diming on stuff,” he says. “Especially if they don’t feel the sale has gone exactly the way they wanted it to, or they have resentment towards the buyer.”

Dooley heard of a seller who removed all the lightbulbs in the house before moving.

“With the amount of money you’re talking about on the sale of a home, I can’t imagine attaching sentimental value to your 60-watt lightbulbs,” she says. “It’s kind of silly.”

 

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Home-Buying Benefits for Veterans & Military Buyers

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Veterans, service members, and their families believe in homeownership. In fact, the homeownership rate among veterans far outpaces that of civilians.

But the financial toll of military service can make it tough for some veterans to get a financial foothold, let alone land a home loan.

The good news is those who serve have access to a host of home-buying benefits and protections, from what’s arguably the most powerful home loan on the market to financial safeguards and more.

Let’s take a closer look.

Home-Buying Benefits for Veterans & Military Buyers

VA loan program

Since the VA loan program’s inception in 1944, the Department of Veterans Affairs has backed more than 21 million loans for veterans, active-duty military members, and their spouses. This program has made buying a home more accessible to those who most deserve the American dream they helped build and protect.

VA loans feature many benefits that help make home buying possible, including the following:

  • No down payment requirement
  • No mortgage insurance
  • Lower average interest rates
  • Limits on closing costs
  • More lenient credit requirements

 

VA home loans have boomed in recent years, attracting many veterans and military members who may not qualify for conventional loans, which have stricter credit requirements.

Still, many eligible buyers are unaware of the benefits of VA home loans and the protections they offer. Some buyers also make the mistake of assuming a government-backed loan comes with endless red tape and miss an opportunity to benefit.

Typically, veterans and active-duty service members are eligible for a VA home loan if they served in the following capacity:

  • 90 consecutive days on active duty during wartime
  • 181 consecutive days on active duty during peacetime
  • 6 or more years in the National Guard or Reserves

 

Some spouses of military members who died in the line of duty or of a service-related disability may also be eligible for a VA loan.

Talk with a VA lender about obtaining your Certificate of Eligibility and getting a sense of your purchasing power.

Occupancy & power of attorney

VA loans are focused on getting buyers into homes they’ll live in full time. But the program makes exceptions for some veterans and active-duty service members.

For example, a spouse or children may be able to fulfill the occupancy requirement on behalf of a VA buyer. Also, a VA buyer who is deployed or otherwise unable to manage the loan process can typically assign a power of attorney to a spouse or family member to manage the loan process and sign documents.

There are two types of power of attorney: general and specific. The type needed depends in part on what loan-related documents the VA buyer can sign.

The occupancy and power of attorney options mean an eligible VA buyer’s spouse and children could buy a home during a deployment or unaccompanied assignment, helping alleviate the emotional toll of multiple moves on military families.

Basic allowance for housing

Many active-duty military members who receive a monthly housing allowance are surprised to learn that they can use this money to qualify for a home loan. Lenders can count Basic Allowance for Housing (BAH) as effective income. That can help service members make the leap from renting to owning, especially in higher-cost areas.

BAH is based on several factors, including the location of your duty station, your pay grade, and your family size. The housing allowance can change on an annual basis. To calculate your BAH, refer to the BAH calculator on the Defense Department’s website.

Financial protections

Even after becoming homeowners, active-duty service members can face unique financial challenges. Deployment and changes of station can strain a family emotionally and financially.

The Servicemembers Civil Relief Act (SCRA) provides active-duty military personnel and their families financial protection involving interest rates, income tax payments, eviction, foreclosure, and more.

For example, military personnel can ask creditors—including their mortgage lender—to cap their interest rate at 6% during their term of service. The SCRA also forces lenders and servicers to seek a court order to foreclose on active-duty military members during their time of service and up to nine months afterward.

Veterans Affairs also offers foreclosure avoidance protection assistance for homeowners. The VA has a team of experts who work with lenders and servicers on behalf of struggling homeowners to find alternatives to foreclosure. Their efforts have helped nearly 500,000 veterans and service members avoid foreclosure in the past six years alone.

Check with your local Armed Forces Legal Assistance office for more information regarding the Servicemembers Civil Relief Act. VA homeowners in jeopardy of defaulting on their mortgage can contact the VA loan program at 877-827-3702.

 

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The New Rules of Renovating: 5 Harsh Truths About Home Improvement Today

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Renovating a home is no piece of cake. Renovating during an unending pandemic? That’s another challenge entirely. Tradespeople are overbooked. Supply chain shortages abound.

But you can get the job done—especially if you know the new rules of the road.

If you’ve been thinking of tackling a home improvement project in the near future, keep reading—you’ll get a better idea of what to expect, plus strategies that’ll set you up for success.

Old rule: Hatch your plan, and get going

New rule: Have a backup plan ready to roll

Check prices and suppliers, and be ready to pounce if a shortage or other hiccup happens.

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Once upon a time, in the not too distant past, home improvement projects were a fairly straight line from “Here’s what I want” to “Here’s how I got it.” After scoping out what you want to do, you’d gather bids to find the best match in terms of professionals and price.

Right now, though, you need to go a step further. Some home professionals believe that having just one plan in mind is not enough to get through the renovation unscathed.

With the current supply chain issues, Janine Acquafredda, an associate broker with Re/Max Real Estate Professionals in Brooklyn, NY, believes that homeowners should have a backup plan before undertaking a project.

“You need to have a Plan B for your design right now, especially if the renovation is time-sensitive,” she says. “You may not be able to get the exact flooring you want or the tiles that you prefer, so it’s best to have a few different designs in mind.”

Check prices and suppliers, and be ready to pounce if a shortage or other hiccup happens.

Old rule: Clients have their pick of available contractors

New rule: Contractors have their pick of interested clients

Contractors have the luxury of cherry-picking their clients right now.

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Part of the planning process is getting bids from contractors. However, while homeowners with cash to spend used to have their pick of qualified pros, things are changing. Now, the shoe is on the other foot.

“In the current climate, a homeowner almost has to ‘sell’ themselves to the contractor and prove that they are a client worth prioritizing,” admits Joe Raboine, director of residential hardscapes at Belgard, a concrete manufacturer and contracting service in Atlanta. “Contractors have the luxury of cherry-picking their clients right now. If they think a client will be difficult to work with, they will often pass on taking on the project.”

That said, Raboine is also quick to note that this supply and demand imbalance doesn’t mean that homeowners should skip doing their homework and take any contractor who’s willing to run with their project.

“Homeowners should still vet the contractor and get multiple bids for their project,” he says. But once you’ve found the right fit, don’t dawdle! Book that project.

“The labor scarcity also means that they should make an effort to treat the contractor well,” adds Raboine. This isn’t the moment to ream out workers and risk their walking off the job.

Old rule: Set a budget and stick to it

New rule: Be prepared for additional costs and then some

To make sure you don’t run out of funds, make sure you have a 30% cushion over the estimated price.

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“Traditionally, our advice was that homeowners should leave 15% of their home renovation budget for contingencies or instances where an aspect of their project may run over the estimated cost,” says Volodymyr Barabakh, co-founder and project director of Structural Beam, a contracting company and construction supplier in Chicago. “However, in 2022, we recommend that homeowners double that amount.”

The reason for the drastic increase? Barabakh points to the supply chain issues.

Lumber isn’t the only material with soaring prices right now, he explains. Glass, electrical components, and structural steel have all been affected as well.

“The costs of many materials are fluctuating wildly,” he says. “Unfortunately, a good chunk of that cost has to be passed on to the client.”

To make sure you don’t run out of funds, plan to have a 30% cushion over the estimated price tag.

Old rule: Set a timeline that works best for you

New rule: Be patient, really patient

Manage your expectations so you don’t freak out when the job isn’t finished when you’d hoped it would be.

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Beyond making materials more costly, supply chain issues will almost undoubtedly affect the time it takes to complete your home renovation project.

According to Jase DeBoer, the senior marketing manager of outdoor living for Deckorators, a composite decking brand based in Grand Rapids, MI, patience is key during this process. So is flexibility.

“Despite proactive forecasts and investments in production and supply, global supply chain shortages aren’t going anywhere anytime soon,” he warns. “While a good contractor will be honest and communicative about the potential challenges they face, you’ll need to work with them to create a realistic timeline. But keep in mind that the timeline will likely be longer than you might expect.”

This can really throw a wrench in your plans: Maybe you are adding a room to your house and have a baby due in a couple of months, or you need a bathroom redone quickly so you can put your house on the market. Even such excellent reasons can’t change the fact that your job will probably run late. Manage your expectations so you don’t freak out when the job isn’t finished when you’d hoped it would be.

Old rule: Get renovations done in one fell swoop

New rule: Tackle what’s urgent, pump the brakes on the rest

Stagger your projects, and save yourself some major stress.

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Renovations can definitely rattle a home. You might lose access to a favorite room or even the kitchen. You have to live with noise, dust, and plastic taped up in the doorways. That’s why many people think if they are going to have work done, they should get it all done at once. In other words, do as much as they can afford to at once and avoid future inconveniences.

But not so fast.

With all these roadblocks facing homeowners as they delve into home improvement right now, some professionals are recommending that they try to wait out the price surges and extended timelines. At the very least, they should carefully consider which projects make the most sense to tackle now and which can be done later.

“It’s smart to pick and choose which renovations you do now and which ones you save for later,” says Donald Olhausen Jr., owner of We Buy Houses in San Diego. “For example, lumber-intensive rehabs will be much more susceptible to price fluctuations than other materials such as drywall or countertops.”

This is a moment when good things can come to those who wait, with those good things being lower costs and fewer delays. So stagger your projects, and save yourself some major stress.

 

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