Tuesday, November 26, 2013

Thanksgiving is Always in Season

Thanksgiving250.jpgMost school children would probably say that Thanksgiving dates back to the Pilgrims at Plymouth as early as 1621. By the late 1660’s, it had become traditional to hold a harvest festival in New England.
President George Washington declared the first nation-wide thanksgiving in 1789 “as a day of public thanksgiving and prayer to be observed by acknowledging with grateful hearts the many and signal favours of Almighty God.”
One hundred fifty years ago during the Civil War, in October, 1863, President Abraham Lincoln proclaimed the first national day of Thanksgiving.
William Seward, Lincoln’s secretary of state, drafted the proclamation: “No human counsel hath devised nor hath any mortal hand worked out these great things. They are the gracious gifts of the Most High God…they should be solemnly, reverently and gratefully acknowledged as with one heart and one voice by the whole American People.”
Even though the country was in the middle of the costly Civil War, the people of America started an enduring tradition to give thanks. In 1941, Congress determined that Thanksgiving will be celebrated on the fourth Thursday in November.

Thursday, November 21, 2013

Do's and Don'ts: Selling Your Home During the Holidays

The holidays can be a highly rewarding time to have your home on the market, but it isn't always easy. We understand that keeping the house show-ready while surviving the countless parties and pageants may be a stretch. On the very bright side, the people who continue to house hunt during this time of year are likely serious buyers! To help you get the most from your showings this season we have a short of list of Do's and Don'ts for your holiday decor:

Traditional Living Room
Don't: Clutter-up what you de-cluttered when prepping to sell.
Do: Pare down decorations. Keep it simple and clean.
This might not be the year to display your 62-piece Santa Bear collection. But don't worry! You can use it next year in your new home. This tasteful example (on left) doesn't distract from the home's natural beauty.

Madame Butterfly Designs
Don't: Cover up selling features with decorations.
Do: Use decorations to highlight selling features.
Consider moving the tree into a corner where it won't block architectural features, or perhaps near a lovely stairwell where it will enhance a feature. The picture on the right depicts a tree blocking a window and a doorway- a poor choice for someone trying sell.

Michelle Edwards

Don't: Assault potential buyers' noses.
Do: Create a warm and welcoming atmosphere.
Flameless candles allow you to create a cozy feel in your home without the fire hazard or seasonal smells. You may like that scent, but buyers could be sensitive to it or simply be bothered. Arranging flameless candles in your fireplace is another nice way to accent a great selling feature with your holiday decor!

Don't: Try to out-decorate your neighbors.
Do: Remember that curb appeal is important, especially in the colder months!
Keep paths clear of snow and leaves and safe for visitors. Decorate your home so that buyers' feel welcomed in from the cold. 
Remember that less is more...

Tuesday, November 19, 2013

Refinance to Remove a Person

refinance 250.jpgMost people are familiar with the various reasons a homeowner refinances their home which generally result in two major benefits: saving interest and building equity. 

There is however another reason to refinance which may not be as common which is to remove a person from the loan. In the case of a divorce, when one party wants to keep the home and the other party wants their equity out of the home, it is possible for the remaining party to refinance the home. If the equity is sufficient to justify it and the remaining owner can qualify for the new loan, the refinance can provide the proceeds to buy out the other spouse.

Refinancing to remove a person from the loan could also involve a situation where two or more heirs jointly own a property and have differing opinions on when to sell. The same situation could apply to a rental property with multiple owners and the refinance would provide a way to buy out a partner.

Sometimes, it’s not about taking cash out of the home to buy out the other party. If a person’s name is on the mortgage, they’re responsible if it goes to default. One party may be willing to deed the home to the other party but it doesn’t necessarily relieve them of the liability of the mortgage they originated.

Many times, once a person has made their mind to move on, they’ll take the fastest and easiest way out. Removing a person from the deed or a mortgage is a reason to consider obtaining legal advice to protect your interests. Refinance Analysis calculator.

Reasons to Refinance

1. Lower the rate
2. Shorten the term
3. Take cash out of the equity
4. Combine loans
5. Remove a person from a loan

Thursday, November 14, 2013

Spotlight Listing: 1604 Winchester

1604 Winchester is the kind of listing that doesn't come around very often.  This gorgeous home sits on a large corner lot in one of the most desired neighborhoods in Midland.  Its wrap around porch, wood floors, fire place, finished basement, and formal dining room set this house apart from the rest.  What else sets it apart? The fact that this incredible home is listed for just $250,000. A beautiful balance of style, function, and location this home is perfect for the family that likes to entertain and is on the move.

The main entry welcomes guests with tile floors and immediate access to formal living room, kitchen, and the second story. As mentioned before, the formal dining room is the perfect space for family dinners or dinner parties! The open layout between kitchen and family room creates a functional space that you'll use for everything from a quick breakfast, to homework parties, to cozy movie nights.  And we would be remiss if we didn't mention that the kitchen comes complete with cherry cabinets, quartz counters, and stainless appliances.

Upstairs you'll find all four bedrooms, each with ample natural light and space for beds, dressers, and even desks. The master bedroom features large windows and an en-suite bath complete with walk-in closet, double vanity, separate shower and tub. If you're still concerned about living space you'll be glad to hear that the basement is finished with built in storage, closets, and a half bath. The main-floor laundry room- with plenty of space for sorting, folding and hanging- is right off the large three-car garage. This space has more than enough room for your lawn tools and a few extra toys.

It's hard to put a price on convenience, style, and functionality; but there is no doubt that those traits, when combined with the endless amenities 1604 Winchester offers, make this home an absolute steal at $250,000.

Watch the Virtual Tour for more photos of this beautiful home; and call Shelley Park Cluff today for your own private showing!

Tuesday, November 12, 2013

Who's Paying Your Mortgage?

who is paying your mortgageAs a homeowner, you obviously pay for your mortgage but as an investor, your tenant does.  Equity build-up is a significant benefit of mortgaged rental property.  As the investor collects rent and pays expenses, the principal amount of the loan is reduced which increases the equity in the property.  Over time, the tenant pays for the property to the benefit of the investor.

Equity build-up occurs with normal amortization as the loan is paid down.  It can be accelerated by making additional contributions to the principal each month along with the normal payment.  Some investors consider this a good use of the cash flows because interest rates on savings accounts and certificates of deposits are much lower than their mortgage rate.

In the example below, is a hypothetical rental with a purchase price of $125,000 with 80% loan-to-value mortgage at 4.5% for 30 years compared to a 3.5% for 15 years.  The acquisition costs were estimated at $3,000, the monthly rent is estimated at $1,250 and $4,800 for operating expenses. 

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Notice that both properties have a positive cash flow before tax.  The cash on cash return is the revenue less expenses including debt service divided by the initial investment to acquire the property.  The 15 year mortgage will obviously have a smaller cash flow and lower cash on cash but the equity build-up is significantly higher.

If the goal of the investor is to pay off the property to provide the highest possible cash flow at a later date, a shorter term mortgage with a lower interest rate will help them achieve that.  A simple definition of an investment is to put away today so you’ll have more tomorrow.  Sacrificing cash flow now, during an investor’s earning years, is a reasonable expectation to provide more cash flow in the future when it might be needed more.

Contact me if you’d like to explore rental property opportunities.

Thursday, November 7, 2013

How To: Choose the Right Counter Tops

A kitchen counter top- it doesn't sound very complicated or even that important, but picking the right one for your house is a very big choice.  Granite, Soapstone, Laminate, Wood, Glass, Stainless, Tile, the choices are seemingly endless.  Sow how do you know which is right for your house?

The first thing for you to consider is, of course, budget. Determine the square feet of counter top you'll need and then decide what you can spend to cover that area.  Laminates could cost between $15 and $30 a square foot, while a high-end granite might cost up to $90 per square foot.

After you know your budget, consider the style of your home and look for a counter top that will enhance the overall feel. You don't want to choose something that looks nice in the store but will be out of place once it's installed.

Now you have to pick from your narrowed pool of choices. But which option will meet your needs?
Here's a quick breakdown of some of the most popular counter top options:

Natural Stone: generally durable, heat resistant, and considered a classic choice. Different levels of durability depending on type of stone- softer stones like marble and limestone may be more susceptible to chipping or cracking. Can require regular maintenance including resealing. Generally the most expensive option.

Manufactured stone: not as natural looking as real stone, but offers heat, stain, and scratch resistance without the regular maintenance. Nearly as expensive as natural stone but has a very long life.

Wood: will not dull knives or utensils when preparing meals. Will wear with use- a look that some find warm and charming. Highly susceptible to damage from heat, moisture, corrosives, and excessive dryness. Requires regular food-friendly sealing.

Metal: stainless steel is the most common metal option and nicely compliments a wide array of home styles. A potentially costly option, but very durable and easy to clean.

Concrete: an extremely heavy option that requires regular sealing but offers a very wide array of color and texture options. Also durable, heat-resistant, and surprisingly versatile when used to compliment other materials.

Tile: very budget friendly and heat, moisture, and stain resistant.  Tiles may break or chip and grout is susceptible to staining and mildew but regular cleaning can protect against that issue.

Laminate: available in nearly every color under the sun, and the most cost effective option. It can be scorched or scratched by very hot pans and sharp knives.

Statistics say that when you sell in the future you may not recoup 100% of your investment in new counter tops; but a well designed and well dressed kitchen could catch a buyer's eye and help sell your home. Find a material that suits your home's style, is neutral enough to appeal future buyers, and meets your current needs. Do your research and make sure you pick the counter top that is right for your home!