5 Ways to Keep Warm During Winter

WarmInWinterThere’s a chill in the air. Evenings are colder and darker, and frost appears on the ground. Whether you like it or not, winter is creeping on us fast.

A lot of people are thinking of ways to keep warm while saving a few bucks at the same time. The good news is there are a few simple ways to keep warm in winter without cranking up the heater. Stay warm no matter how frightful the weather outside gets with these tips.

Harness the sun

Window glass permits light and natural heat to pass through. Make the most of all this free energy by opening the curtains and blinds during the day. However, single-glazed windows can get extremely cold at night. Lower the blinds and close the curtains immediately after dusk to prevent heat from escaping.

Keep the door open

There are certain doors that can actually increase the heat in your home when left open, and we’re not talking about the front door.

Leave the door open the next time you shower or run a bath. Also, don’t drain the water until it cools to room temperature. The warm, humid air will help raise the temperature. Of course, this is much easier if you live alone or with a significant other. Go ahead and give it a try.

Use the oven

Holidays are a great time for baking cakes, cookies, pies and breads. Not only will these sweet treats put a smile on your loved one’s faces, it also helps warm the house. Leave the oven door open after baking. But if you have pets or kids, this may not be a good idea.

Layer up

Bundle up. Wear several thin layers rather than one thick layer. Wear thermal underwear, long-sleeved shirt and a hat when it’s really cold. Also, choose clothes that are made from fleecy fabrics, cotton or wool. Since we lose most of our body heat through our hands, feet and head, it is important to wear thick socks and warm hat.

Sip on something hot

Drinking hot chocolate, coffee, tea and other warm beverages will raise your body temperature in a jiffy. If your taste buds prefer something more savory, stews and soups are a great alternatives.

Homeowner Mistakes That Can Make Your Home a Target for Burglars

Aside from being a victim of violent crime, the next worse thing that could happen is to have your home burglarized. Other than the loss of personal belongings, victims are often haunted by fear, wondering if the burglars would be coming back for more.

With over 8,000 home burglaries in the United States every year, it is always a good idea to take precautions. In this blog post, we have compiled 4 homeowner’s mistakes that can make your home a target for burglars. Read on and reduce your chances of being a victim of home burglary.

Leaving the lights on

Most homeowners leave the lights on to give the look of an occupied home. However, experienced burglars can easily tell whether someone is in the house or you’re just using it as a decoy.

Instead of the leaving the lights on all day and night, consider getting a timer that turns light on and off in different parts of the house at different intervals. The more activity burglars see, the less likely are they to target your home.

Posting detailed alarm signs

Window stickers and yard signs are a great way to let neighbors and others know that your home is equipped with a monitoring service. However, if you put up a detailed sign, one that includes the alarm company, it’s as good as giving the burglars a free pass into your home. All they have to do is to get a diagram of how that particular system is wired to disable the alarm.

Trash barrels are out early

If your trash cans are out on a Thursday, but pickup day is not until Monday, you are telling burglars that you’ll be out of town over the weekend. Since you can afford to go on vacation, it also means that you have some expensive items inside the house.

You might be excited for this trip, but please do not announce your vacation on social media. You’ll be surprised how easy it is to look up your address and break-in into your home.

Getting a big dog

Just because you have a 100-pound German shepherd or Rottweiler doesn’t mean that your home is safe. Yes, burglars hate dogs and these dogs look scary, but these they are not barkers. If you really want to get a dog to guard your home, go for small dogs like Chihuahuas. These dogs make a lot of noise.


Tax Relief for Struggling Homeowners Extended


While the housing market is finally recovering, there are still a lot of homeowners who are still unable to meet their mortgage obligations due to a struggling economy.

In an effort to address this, President Obama has signed a bill that extended the Mortgage Forgiveness Debt Relief Act on December 16, 2014. The package of tax extensions include important provisions that will help distressed homeowners and commercial property investors with the transactions that they have made in 2014.

Among the real estate provisions included in the extenders package are deduction for energy efficient commercial buildings, election to expense certain qualified real property, 15-year cost recovery for qualified leasehold improvements and tax relief for mortgage debt forgiveness.

These exclusions had expired at the end of 2013. But on December 3, the U.S. House of Representatives passed a bill that retroactively reinstated each of these provisions through all of 2014.The Senate finally followed suit and passed the bill on December 16.

Mortgage Forgiveness Debt Relief Act

The federal tax code treats forgiven debt as taxable. But The Mortgage Debt Relief Act of 2007 allows tax payers to exclude income from the discharge of debt on their principal residence.

This prevents homeowners who went through principal reduction, short sale or foreclosure sale from being taxed on the amount of debt that has been forgiven. As long as that forgiven debt arose from the loss or sale of their principal home, they are given one more year to eliminate forgiven debt from their income when filing for their tax returns.

Without this bill, thousands of homeowners who short sell their home could be facing a huge tax bill. Those who sold their homes via a short sale or lost their homes to foreclosure were able to breathe a little easier, knowing they could avoid a significant tax hit.

Mortgage Rules Changes Are Coming in 2014

The world of mortgage lending has changed significantly since the housing bubble burst. Mortgage lenders have returned to traditional loan standards that require extensive documentation of income and assets for a loan approval.

Government regulatory agencies also continue to react to the housing crisis, with more adjustments to mortgage requirements set to go into effect in 2014:

Qualified Mortgage Rules

Whether you’re thinking of buying a home or mulling over refinancing your mortgage, Jan. 10, 2014, could be an important date for you to remember. The Consumer Financial Protection Bureau is in the process of implementing regulations to meet goals set forth by the Dodd-Frank Act in Congress, which was meant to correct the errors that led to the housing crisis. The CFPB’s “Qualified Mortgage,” or QM, rules go into effect in January. Essentially, these rules require lenders to prove borrowers’ ability to repay a loan by meeting several guidelines, including a maximum debt-to-income ratio of 43 percent. While many lenders already limit borrowers to a similar maximum debt-to-income ratio, the new rules won’t allow for any compensating circumstances such as significant cash reserves or a large down payment to be considered in order to offset a higher debt ratio.

If you have credit problems or a high debt-to-income ratio, you may want to push through your loan application for a refinance or home purchase to make sure you close your loan before the new rules go into effect. However, many lenders are already using QM standards in order to make sure they’re in compliance with the regulation. Mortgages that don’t meet QM standards will have to be held by the lender rather than sold to Fannie Mae and Freddie Mac, so most lenders are careful to meet the new standards.

The 3 Percent Rule

The new QM requirements also limit fees for originating a loan to no more than 3 percent of the loan amount. If you’re financing a more costly home, such as a $400,000 home or more, the lender can easily keep fees under 3 percent, which in this case would be $12,000. However, if you’re refinancing a smaller loan balance or purchasing a less expensive home — for example, for $80,000 — the lender might find it more difficult to keep all fees under $2,400. Mortgage lenders are less likely to offer loans for smaller amounts since they won’t always recoup their costs and make enough profit to pay their staff. If you need a small loan, you may want to push to get it closed before Jan. 10, 2014.

Self-Employed Borrowers

One particular group of borrowers will most likely be impacted by the QM rules: self-employed borrowers. These borrowers already are heavily scrutinized and find it more difficult to obtain a mortgage because they must prove their income based on tax returns and profit-and-loss statements, rather than standard paystubs and W2 forms. The “ability-to-repay” feature of QM rules requires all borrowers to prove they have the cash flow to make payments on their mortgage. Self-employed borrowers often have fluctuating income and rely on cash reserves to pay bills in-between payments, but the emphasis on cash flow can make it harder for lenders to approve a loan even for someone with significant funds in the bank.

Potential Lower Loan Limits

The Federal Housing Finance Agency, which regulates Fannie Mae and Freddie Mac, announced in October that plans to reduce the maximum loan limits for conventional conforming loans will be delayed until later in 2014. Typically, loan limits are adjusted on Jan. 1 of each year, but the agency decided to wait to see the impact of the introduction of QM rules before making changes. Currently, the limits are $417,000 in most housing markets and rise to $625,500 in high cost areas. If you need a mortgage near these limits, it would be wise to close your loan earlier in 2014 rather than later in case limits are lowered.

Mortgage Rates Jump Slightly

Fixed-rate mortgages increased for the second consecutive week. However, further increases are not predicted in the short-term. Key averages previously hit their lowest levels since June in the month of October. Despite the recent increase, fixed-rate mortgage loans remain affordable by historical standards.

The recent rise in rates is attributed to signals of economic strength, specifically, improved employment numbers for the month of October.

“Fixed mortgage rates increased this week following stronger than expected economic data releases,” Frank E. Nothaft, Freddie Mac’s vice president and chief economist, said in a statement. “Nonfarm payrolls increased by 204,000 in October, above the consensus forecast. In addition, revisions added 60,000 additional jobs to the prior two-month releases.”

The average rate on a 30-year mortgage rose to 4.35 percent this week, an increase of 0.19 percentage point, according to the latest survey from mortgage buyer Freddie Mac. The 30-year average was 4.16 percent a week ago and was trending at 3.34 percent a year ago.

The average rate on a 15-year mortgage saw a modest increase, increasing by 0.08 percentage point. Previously at 3.27 percent, the 15-year average is now 3.35 percent. One year ago, it averaged 2.65 percent, an increase of 0.7 percentage point year-over-year.

The averages on hybrid adjustable-rate mortgage loans were mixed. The average on a five-year ARM increased by 0.05 percentage point week-over-week and is now at 3.01 percent. The one-year ARM average was static, remaining at 2.61 percent week-over-week.

Looking forward, rates are expected to hold steady in the short-term. In the latest Mortgage Rate Trend Index by Bankrate.com, 50 percent of the experts and analysts polled believed that rates will remain unchanged over the next week, while 30 percent predicted rates will trend downward .

“Mortgage rates spiked after the better-than-expected headline number for last Friday’s employment report. Now tapering talk seems to be delaying the date that the Fed slows its assets purchases. But the last time rates spiked like this, there was a noticeable slowdown in home purchase applications,” said Michael Becker, WCS Funding Group mortgage banker. “I think the Fed is aware of this and will attempt to calm the markets over the coming week. Therefore, I see mortgage rates holding steady in the coming week.”


How to Negotiate the Best Real Estate Deal

Whether you’re a buyer or a seller you want to succeed in the realty marketplace. That’s natural and reasonable, but what are the steps you need to triumph?

Negotiation is a complex matter and all transactions are unique. Both sides—buyer and seller—want to feel that the outcome favors them, or at least represents a fair balance of interests. In the usual case there is a bit of bluff, some give-and-take, and neither party gets everything they want.
So how do you develop a strong bargaining position, one which will help you get the most from a transaction? Experience shows there are five basic keys which will determine who wins at the negotiating table.
1. What does the market say?
At various times we’re in a “buyers” market, a “sellers” market, or a market where housing supply and demand are roughly equal. If possible, you want to be in the market at a time when it favors your position as a buyer or seller.
Because all properties are unique—it is possible to buck general trends and have more leverage than the marketplace would seem to allow. For instance, if you have a property in a desirable neighborhood with few sales, you may be able to get a better deal than elsewhere. Or, if you’re a buyer who can quickly close, that might be an important negotiating chip when dealing with an owner who just got a new job 500 miles away.
2. Who has leverage?
If you’re on the front page of the local paper because your business went bust—and the buyer knows it—you have little clout in the bargaining process. Alternatively, if you’re among six buyers clamoring for that one special property, forget about dictating an agreement—the owner can sit back and pick the offer which represents the highest price and best terms.
3. What are the details?
A lot of attention in real estate is paid to transaction prices. This surely makes sense, but the key to a good deal may be more complex.
Consider two identical properties that each sell on the same day for $275,000. The houses are the same, the sale prices are the same, but are the deals the same? Maybe not. For instance, one owner may have agreed to paint the property, replace the roof, purchase a new kitchen refrigerator, and pay the first $3,000 of the buyer’s closing costs. The second owner made no concessions.
In this example, the first house was actually sold at discount—the $275,000 purchase price less the value of the roof repairs, closing credit, and other items. If you’re a buyer, this is the deal you want. If you’re a seller, you would prefer to be the second owner and give up nothing.
4. What about financing?
Real estate transactions involve a trade—houses for money. We know the house is there, but what about financing? There are several factors that impact the money issue:
  • Has the buyer been pre-qualified or pre-approved by a lender? Meeting with a lender before looking at homes does not usually guarantee that financing is absolutely, unquestionably available—a loan application can be declined because of appraisal problems, title issues, survey findings, and other reasons.
    But, buyers who are “pre-qualified” or “pre-approved” (these terms do not have a standard meaning around the country) at least have some idea of their ability to finance a home and know that they are likely to qualify for certain loan programs.
    The result is that pre-qualified buyers represent less risk to owners than a purchaser who has never met with a lender. If the seller accepts an offer from a buyer with unknown financial strength, it’s possible that the transaction could fail because the buyer can’t get a loan. Meanwhile, the owner may have lost the opportunity to sell to a qualified buyer.
  • The lower the interest rate, the larger the pool of potential buyers. More buyers equal more potential demand, good news for sellers.
    Alternatively, high rates or even rising rates may drive buyers from the marketplace—and that’s not good for anyone.
  • It used to be that downpayments were a major financing hurdle—but not anymore. For those with good credit, loans with 5 percent down or less are now widely available. In fact, 100 percent financing, mortgages with nothing down, are now being made by conventional lenders. Reduced downpayment requirements are good for both buyers and sellers.
5. Who has expertise?
Imagine you’re in a fight. The other guy has black belts in 12 martial arts—and you don’t. Who’s going to win?
Brokers have long represented sellers, and now buyer brokerage is entirely common. In a transaction where one side has representation and the other does not, who has the advantage at the bargaining table?

Source: http://www.realtor.com/home-finance/real-estate/sellers/negotiations-in-real-estate-deals.aspx

Good News for High-End Home Buyers?


Jumbo loans are reportedly becoming easier to obtain, which may be welcome news for high-end home buyers.

Jumbo loans are mortgages larger than $417,000 in most parts of the nation and $625,000 in high-cost areas.

In the first quarter of 2013, lenders originated $54 billion in jumbo loans, up from $47 billion one year earlier, according to Inside Mortgage Finance.

Many jumbo lenders also reportedly are increasing the amount of a home’s value they will agree to finance.

“The pickup in jumbo lending comes as home prices are rising and banks are looking to build closer ties with affluent clients and put more loans on their balance sheets,” The Wall Street Journal reports.

J.P. Morgan Chase originated $5.6 billion in jumbo loans in the first quarter, which is 67 percent more than a year ago.

“Housing prices are going up, consumer confidence is growing, and the affluent segment is in better shape,” says Kevin Watters, chief executive of mortgage banking at JP Morgan Chase.

Bank of America has increased its jumbo loan origination by 37 percent in the first five months of 2013.

Source: “High-End Home Loans Stage a Comeback,” The Wall Street Journal (June 21, 2013)

Prop Furniture for Property Listings


Faux furnishings, including prop furniture and fake electronics, are regaining popularity as the housing market picks up steam.

Home stager Douglas Pinter of inFormed Space can stage a two-bedroom apartment using the contents of four nylon bags, with lightweight, polypropylene furniture that can be folded flat and assembled in a couple of hours. Staging with inFormed Space’s faux furnishings costs about one-third of a traditional staging project.

Other companies offer furniture made from corrugated cardboard and draped in slipcovers; and stagers can even purchase fake TVs, laptops, and videogame consoles.  “You want a home buyer to walk into the spaces and really feel like they could be sitting at [the] table,” says Kelly Young of Plantation, Fla.-based Kelly Young Design Associates.  Not only are faux furnishings less expensive, but they also help deter thefts at open houses.

Source: “Faux Furniture: From Open Box to Open House,” Wall Street Journal (05/31/13)

Copyright © 2013 Information, Inc.

Rising Housing Market Likely to Lift Job Mobility


Home owners are starting to feel freer to move where the jobs are, Reuters reports, as worries about homes that won’t sell or will sell at a loss begin to fade.

Since early 2012, home prices in the major metro areas have been rising. Homes are also selling faster: It took 62 days, on average, to sell a home, compared with 91 days one year prior, according to March data from the National Association of REALTORS®.

The increase in mobility from the recovering housing market is expected to have a hand in lowering the jobless rate.

“Until the real estate market picked up, people wouldn’t even consider a move without the certainty that they could sell their homes,” Jerry Funaro, vice president of global marketing for TRC Global Solutions, a Milwaukee-based relocation service, told Reuters. “Companies are now more inclined to make offers since we’re seeing real estate markets across the country coming back.”

The number of people who moved last year increased to 35.6 million, with the mover rate climbing to 12 percent, according to the U.S. Census Bureau. That marked an increase over the 11.6 percent low set in 2011.

“It’s not a huge gain, but when you consider that for two years, we’ve had the lowest migration rates since World War II, any move up is good news,” William Frey, a demographer at the Brookings Institution in Washington, told Reuters.

Meanwhile, in April, the jobless rate dropped to its lowest point in more than four years, reaching 7.5 percent, due to an increase in hiring among employers.

Source: “Insight: Housing improvement may herald return of U.S. workforce mobility,” Reuters (May 13, 2013)

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Improving Market List Drops Slightly in May


The Improving Markets Index fell to 258 metros in May from 273 in April, but continues to reflect metros from every state as well as the District of Columbia, according to the National Association of Home Builders and First American.

The Improving Markets Index identifies the metro areas that have shown improvement in housing permits, employment, and housing prices for at least six consecutive months.

Nineteen metros dropped from May’s index, but NAHB Chief Economist David Crowe says that this is similar to what happened with the index last year, as softer prices are usually seen in the winter months.

Meanwhile, four new markets were added to this month’s index: Dothan, Ala.; Elizabethtown, Ky.; Salisbury, Md.; and Salem, Ore.

“The fact that over 70 percent of all U.S. metros are holding onto their spots on the improving list is definitely good news, and representative of the generally brightening outlook for housing markets nationwide,” says NAHB Chairman Rick Judson. “That said, our industry’s progress on the road to recovery is being slowed by rising challenges related to the availability of credit, building materials, labor, and lots for development.”

To view a complete list of the 258 metros on the index, visit www.nahb.org/imi.

Source: National Association of Home Builders