Author: Shannon

5 Trends to Look for in New Construction Homes in 2018

Housing trends come and go – some we’re happy to see sitting at the curb, others we decide to keep around longer. Architects, designers and builders see these trends coming long before we do and we thought it might be fun to take a look at some of what we can expect to see in 2018’s new homes.

1. Not tiny, but smaller

While Gen X is shopping for larger, move-up homes, both baby boomers and millennials are on the hunt for smaller homes.

Because of this, and despite land and labor being pricey, builders are more than happy to supply these homes in 2018.

Small, however, doesn’t mean cramped. You’ll still find the open floor plan that has been popular for the past decade.

One trend worth mentioning is that many new homes will feature “more and larger windows … and multiple skylights,” according to Petro Homes in Ohio. These not only help add natural light to the home, but make rooms appear larger.

2. Kitchen trends

Although the one-room kitchen at the back of the house became extinct over two decades ago, the open kitchen trend continues. The kitchen that opens to the family room or dining room is a trend that will continue as the focus on entertaining grows, or so says a CBS News piece.

Last year’s open-kitchen trends included appliances that blend into the adjacent living spaces. Think wood-front refrigerators.

In 2018, the open-kitchen trend continues, but with the addition of a bit of bling.

You’ll see copper, rose gold and brass in light fixtures and hardware

While granite countertops are still trendy, don’t be surprised to find quartz in high-end new homes. Unlike granite, quartz countertops don’t need to be sealed (and re-sealed).

3. Energy efficiency is trendy

Studies show that “green” homes sell quicker and for more money. Those purchasing a green home may be doing so, however, to save money while living there. Thankfully, builders are wising up and ramping up their energy efficiency programs in 2018.

One of the easiest trends any homeowner can implement this is with a touchless faucet. We’ve all needed to turn on the water with greasy hands and this faucet does away with that.

And, touchless faucets save water by only giving it to you when you need it

If you’re looking for a new home and want green features, contact us. We’re happy to show you what’s available for sale right now.

4. Smart stuff

It’s been slow to catch on but home builders say that home automation is one of the fastest growing trends in their industry.

Appliances are the most likely candidates but don’t be surprised if you find you can turn on the heater on your way home from work or open the front door, with your phone.

The new smart thermostats help homeowners combine the convenience of home automation with energy efficiency by tracking our behavior and “learning” what temperature we prefer in the home when we get up in the morning, arrive home from work and go to bed in the evening.

5. Outdoor Spaces

The trend toward outdoor living spaces started a couple of years ago and experts estimate it will be even stronger in 2018. According to a Wakefield Research survey, 56 percent of prospective homebuyers surveyed said they would give up interior square footage if it meant they’d get a larger yard.

The bonus? A nearly 60 to 71 percent return on investment when the home with outdoor living features is sold,

according to Remodeling magazine’s 2017 Cost Vs. Value report

Custom homebuilders are happy to create your oasis, and some new-home development builders are starting to add electric, gas and plumbing connections to outdoor space that they consider will be likely sites for outdoor living spaces.

Outdoor kitchens are the most popular, with a pool and spa coming in a close second. Outdoor fireplaces and pits come in third.

If 2018 is the year you’ll finally get that nobody-has-ever-lived-here-before home, get in touch with your real estate agent. It’s important to have your own representation, so you don’t have to rely on the builder’s agent.

Holiday road trip: Don’t let winter weather catch you by surprise

When Mom Nature throws wicked winter weather our way, the difference between being safe and stranded can often come down to how prepared you are.

The following tips will ensure that you’re ready for whatever happens on the wild and woolly roads, and alleviate some of the anxiety of taking to the road in winter.

Prepare your vehicle

Ensure that you’ll actually get to Gramma’s house by preparing the car for the trip.

Check the car’s antifreeze and top it off, if needed. The manual that came with your vehicle will instruct you on how to check the levels

It’s not just the level, however, that you should inspect, but the mixture as well. Inexpensive commercial testing kits are available at auto supply stores. Thoughtco.com offers a handy walk-through of the testing process.

How are the tires looking? Check the pressure and add air if necessary. Then, check the tread, using the “penny,” as suggested by justtires.com. Insert a penny into the tread “with Lincoln’s head upside down and facing you,” they suggest. “If you can see all of Lincoln’s head, your tread depth is less than 2/32 inch and it’s time to replace your tires.”

In particularly wicked winter weather you may want to consider buying winter tires before hitting the road. “In places where snow and ice prevail for several months a year, the average driver will exceed all-weather tires’ grip limits multiple times a day,” according to Mack Demere, at Edmunds.com.

The experts at dmv.org claim that mechanics recommend a thinner motor oil for cars driven in areas with sub-freezing temperatures so talk to your mechanic before you have an oil change to find out what she or he recommends.

Then, fill the windshield wiper fluid reservoir with a freeze-resistant fluid.

Finally, check the breaks, battery and heating/defrosting system.

Create an emergency kit for the car

Your vehicle emergency kit should include:

  • Blankets for each occupant
  • Ice scraper and/or liquid deice
  • Shovel
  • Bottled water
  • Non-perishable food
  • LED flashlights
  • Flares
  • Extra clothes (especially shoes or boots and socks)
  • First-aid kit
  • Basic tools
  • Jumper cables (at least 16 feet in length, according to itstactical.com)
  • Matches or lighters
  • Sand (to pour under the tires, if needed)
  • Extra phone charger
  • Battery-powered radio and extra, fresh batteries
  • Tow chain or rope
  • Fluorescent distress flag

If you get stuck

Disasters happen when folks make the wrong decisions about whether to stay put or go for help when they’re stuck on the road during a snow storm.

If you can’t see a safe location nearby, if you broke down on a road where rescue is unlikely, if you’re not dressed for the weather or you don’t have a way to call for help, pull off the highway, turn on the car’s hazard lights and stay inside the vehicle.

Run the engine and heater once an hour for about 10 minutes to keep warm. During these sessions, “open a downwind window slightly for ventilation and periodically clear snow from the exhaust pipe. This will protect you from possible carbon monoxide poisoning,” suggests the Department of Homeland Security.

If you don’t have a blanket, use whatever you can find in the car for insulation, such as seat covers, road maps and floor mats. Light exercise will also help you maintain body heat.

If, on the other hand, you are dressed for the weather (several layers of warm clothing with moisture repellant outerwear, mittens, hat and a scarf to cover your mouth), the conditions outside are relatively safe and there is a nearby source of help, leave the vehicle to seek assistance.

Additional considerations

  • Drive only if it is absolutely necessary during heavy snowstorms.
  • Always let someone know where you are going, which route you’ll be taking and your estimated time of arrival. Then, stick to the route without taking shortcuts.
  • Monitor local weather conditions.

Taking simple steps before your road trip keeps you from being at the mercy of severe winter weather.

Tips for touring model homes

If the homeowners have done their job, a home for sale has been cleaned up, gussied up and put on display to entice potential buyers to make an offer to purchase.

Never is this more evident than in model homes in new housing developments. Carefully staged by interior decorators, every element — from the wall color to the appliances and every decorative accent — is chosen for its ability to appeal to a buyer’s emotions.

If you plan on spending a weekend touring model homes, it’s a good idea to go into the process with as much information as possible. Let’s take a look at some of what you should think about before taking those tours.

What to Bring with You

The most important “thing” to bring with you when you tour new home communities is your real estate agent.

This may seem counterintuitive when you get there and realize that the builder or developer has an on-site real estate agent. Wouldn’t it be more convenient to use that agent?

Are you looking for convenience or assurance?

Although the builder’s agent may be a very nice person and although it may be perfectly legal for her to work with you and the builder in what is known as a “dual agency” situation, you are taking unnecessary chances by teaming up with the agent.

The builder’s agent has a duty to look out for the best interests of the client and that client is the builder. Since it doesn’t cost you a penny to have your own representation, and you stand to gain so much by having someone in your corner, bring your own real estate agent.

At the very least, let it be know that you have an agent and have no intention of working with the builder’s.

Next, bring that wish list with you. Lists of any type help keep us focused on what’s truly important – what we really need and want – and avoid impulse shopping.

You’ll need a camera or your smartphone as well. Having photos of the various features will help you compare homes.

Bring along a tape measure so that you won’t have to guess at room sizes, the length of walls and the interior of closets.

If you’re shopping alone, bring along a friend or family member for a second opinion and to bounce ideas off of.

Get the lay of the land

Location is everything when it comes to real estate so get to know the community before looking at the homes. Consider not only its location within the city, but surrounding amenities that you require.

Then, take a walk or drive through the community to get a feel for what it will be like when completed and to get an idea of which lots are better suited for your needs. 

Don’t fall for the staging

So often we see homebuyers lured into buying a new home simply because of the way it’s presented. Try to look beyond the snazzy décor and yummy paint colors to the flow of the floorplan.

Remember: Staging is meant to target your emotions

Try to imagine the same home with your furnishings, appliances and accessories. In fact, if you’ve fallen head-over-heels for a home, ask to see the same model, unfurnished.

After all, this is what the home will look like when you purchase it

If your heart is set on the home looking identical to the model, request a breakdown of the upgrades used in the model and the cost to replicate them.

Don’t be shy when it comes to asking questions. If your agent isn’t accompanying you on the tour, ask the on-site agent.

Find out about home warranties that are included with the purchase, the cost of upgrades that interest you, the type of financing offered, community amenities, the building process and whatever other questions come to mind.

The new-home buying process differs from buying an existing home. We’re happy to walk you through the process so feel free to reach out.

What to ignore during your search for the perfect condo

Condos can be the ideal purchase for homebuyers who are on tight budgets. They’re typically lower priced than single-family homes, insurance is less expensive and ongoing home maintenance costs are kept to a minimum.

There are some aspects of condo-buying that should never be ignored, however. These include:

  • The periodic association fee and how much it will add to your monthly house payment.
  • The homeowner association packet of documents for the homebuyer (it includes vital information).
  • Communities with a large number of homes for sale. Do the research required to find out why so many residents are leaving.

When touring condos for sale, however, some things are better left ignored.

Try to look beyond the cosmetics

Cosmetic issues are easily remedied and typically inexpensive to fix. Ignore the following while looking at condos for sale:

Wall color

Paint colors are personal and what turns on one person may be repulsive to another. Because condos are typically smaller than single-family homes, distasteful wall colors can overtake entire rooms.

Not only that, but the wrong color can make a room appear smaller than it is. Don’t take the paint’s word for it – measure rooms to get the true size.

Then, remember that walls can be transformed relatively inexpensively.

The average square footage of a U.S. condo is 1,482 according to the U.S. Census Bureau. The nationwide average cost to paint a home this size, without hiring a professional, is between $200 and $300 for basic paint and $400 to $600 for high-quality paint.

Hire a pro to do it for you for about $1,100 to $2,000, according to costhelper.com.

Ignore the walls – it’s an easy, inexpensive fix.

Dark and gloomy is also an easy fix

Even with all our years of viewing homes, it remains a mystery to us how some people can live in dark, gloomy homes. Even a lack of natural light shouldn’t prohibit someone from introducing artificial light sources to the home, especially when it’s a fact that light helps lift our moods.

Don’t let the gloom stop you from putting in an offer on a condo that offers most everything else you are seeking in a home. Lighting is inexpensive and, the right fixtures can transform your home.

Check out the room-by-room lighting guide at Huffington Post and ways to enhance your decorating scheme with lighting at bhg.com.

The personal stuff will be gone

We get it. All that dated furniture, the collections of books, knick-knacks or other items, family photos and other personal items and clutter are distracting.

And, although it may be challenging, it’s important to remember that it will all be gone when you move in. Look beyond the clutter to the basic flow of each room — the “bones” of the home.

The flip side is just as dangerous

While ugly interiors can be distracting, so can gorgeous ones. Stagers are skilled at making homes appear move-in ready and at creating interiors that appeal to a broad range of homebuyers.

Don’t buy into the fantasy

Those Imperial silk draperies will most likely go home with the stager when the home is sold. Ditto for all the accessories that go into the psychological appeal of the room, the throw pillows, fresh flowers and plants and mirrors and artwork.

Staged rooms also may not be as large as you think they are. Some stagers use smaller-scale furniture to trick the eye into making a room appear bigger. Paint colors are likewise chosen to make homes seem roomier.

If in doubt as to whether or not your furniture will fit in the home, measure each room.

The National Association of Exclusive Buyer Agents (NAEBA) cautions homebuyers that stagers often use “furniture and wall hangings to cover up or direct a buyer’s attention away from floor damage or wall damage.”

They also remind homebuyers that staged homes are often perceived as being well-maintained homes. Often, this perception is far from reality.

“Many times, staged homes take advantage of the staging to cover up deferred maintenance issues and improper construction and repair issues,” they say in the 2007 report, “How to Not Get Tricked by Staging, and Potentially Save $5,645 when you Buy your Home.”

Ignore the home’s staging and perform your due diligence by looking behind wall hangings and under rugs and furniture.

Whether the condos you tour are diamonds in the rough or staged to perfection, it pays to look beyond the cosmetics to whether the space works for your needs and lifestyle.

3 amazing kitchen designs

In 2015, more than 10 million American households spent nearly $50 billion renovating their kitchens, according to the National Kitchen and Bath Organization.

Since the kitchen is the most-used room in the home, and the most popular among homebuyers, it’s money well-invested

If you plan on joining the renovators it’s time to learn about various kitchen design concepts so that you’re better able to choose the one that fits your lifestyle. You can never over-plan your new kitchen, right?

From color schemes to layouts, windows to lighting, here are some brilliant kitchen concepts from top designers.

The contemporary kitchen

If you fancy yourself on the cutting edge of technology and love new gadgets you may just be the type that will enjoy a contemporary kitchen.

Think “sleek” when choosing appliances and anything you can have built-in, by all means do so, even the coffee maker.

Speaking of appliances, a “smart” refrigerator is right up your alley

Forget about granite and even quartz for the countertops and head straight for concrete.

Look for patterned backsplashes (such as glass tile) and don’t forget under — and inside — cabinet lighting.

HGTV suggests the best places to shop for contemporary kitchen items include West Elm, Crate & Barrel and Pottery Barn. They also offer a style guide for contemporary kitchens on their website.

Go Mediterranean

The Mediterranean kitchen can be summed up in two words: Warm and cozy. Oh, go ahead and throw in “romantic” as well because the iconic rich colors of this style positively drip with amour.

Houzz’s Lisa Frederick suggests using “a blend of spicy red, bright yellow, terra cotta and ocean blue” as your color scheme. Then, add dark cabinets and upholstery fabrics that connotes the sun and sea.

Top it all off with ceramics anywhere you can put them, from accessories to backsplashes.

For ideas on how to create a Mediterranean kitchen in your home, visit Decoist and Houzz. The latter also offers an accessory buying guide for your Med kitchen.

The cottage kitchen

Although cottage-style design may seem more suited to a vintage home, such as a bungalow, if done right it can be quite attractive even in a newly constructed home.

As you approach the design, think homey, cozy, utilitarian and down-to-earth.

Color schemes are typically heavy on the white, but “pretty painted base cabinets in pastel blue make a room shine bright,” according to Kathy Barnes at Better Homes & Gardens.

Speaking of cabinets, you can also forget the traditional and opt for attractive, vintage-looking shelves instead. Then, throw in a farmhouse sink, hardwood floors and pendant lights.

See examples of cottage kitchens at Southern Living, This Old House and Better Homes and Gardens.

Tips on financing the luxury home

The luxury home purchase process is different from buying a conventional or tract home. There’s more money passing hands, so naturally the risk escalates.

The process is slower as well, so if you plan on purchasing a luxury home, and you won’t be paying cash, you’ll most likely need to obtain a jumbo loan.

What is considered a luxury home?

You might be surprised to know that it isn’t merely the price that defines the luxury home. While the concept can best be defined by perception, here are some additional characteristics of luxury homes:

  • Desirable location
  • Distinctive architecture
  • Amenities

Since everything concerning real estate depends on location, a basic defining point of a luxury property is “a home that goes above and beyond what’s typical for the market,” according to Devon Thornsby, real estate editor at U.S. News.

What typically doesn’t differ in the luxury home market is the financing of the home

If you’ll be pursuing a jumbo loan to purchase your luxury home, you’ll need to start the loan process well in advance of shopping for homes.

What’s a jumbo loan?

A jumbo loan, also known as a non-conforming loan, is what you’ll need to purchase a property that is priced higher than Fannie Mae’s and Freddie Mac’s conforming loan limits. For 10 years, the conforming loan limit has stood at $417,000 for a single-family home.

That changed last year, when markets heated up and prices began to soar. The limit is now $424,100 for most regions across the country (it is higher in certain high-cost counties, such as some in California).

Find your county’s loan limit at Bankrate.com. Click on your state and you’ll be taken to a list of counties and their corresponding conforming loan limit.

Qualifying for a jumbo loan

Jumbo loan requirements are more stringent than those of the conventional loan and they vary by lender.

You will usually need a higher credit score (typically 700 or higher). Generally, a 10 percent down payment is required, although borrowers with high credit scores can find mortgages with a 5 percent down payment requirement.

The good news is that, in their pursuit of wealthy clients, some lenders are willing to waive the private mortgage insurance (PMI) requirement on these low-down payment loans.

Like all loans, however, you’ll need to prove that you can make the monthly payment

This means proving:

  • A stable employment history – at least two years with your current employer or two years of tax returns to prove self-employment.
  • An explanation of what you do for a living if its “value” isn’t as obvious as, for example, a physician or CEO.
  • Proof of your income – Lenders want to see not only pay stubs, but bank statements as well (even the blank pages, believe it or not).
  • Proof of your down payment funds.

In a nutshell, you will need to be able to document your assets, show a high credit score (the average score for the jumbo loan in the first quarter of 2017 was 771) and show proof of a responsible credit history.

Jumbo loan expenses

As of the first quarter of 2017, jumbo loans were actually cheaper (by 21 basis points) in the long run than conforming loans, according to a report released by Core Logic.

In August of this year, for instance, interest rates on these loans tumbled to where they were “13 basis points lower than the conforming rate, the largest spread between the two since March 2016,” according to CNBC’s Diana Olick.

Be prepared for closing, however

Because there are additional steps in the qualifying process, jumbo loans tend to carry higher closing costs. An example of an extra step is a lender who may require two appraisals of the property.

It may even out in the end, however, with the aforementioned sweetening of the pot to attract wealthy clients.

Not only are some lenders waiving the PMI requirement for low-down payment jumbos, but also accepting borrowers with low credit scores.

If you’re interested in pursuing a jumbo loan, contact us and we will put you in touch with local lenders who can answer all your questions.

Black Friday! 8 ways to save money when buying appliances

Black Friday – it’s right around the corner. If you’re in the market for new appliances, this may be the day for you to find a good deal, according to consumer expert Andrea Woroch at Clark.com.

Yes, September and October are typically the best time to buy major appliances, but Black Friday deals abound. Before shopping, get clear on what you need, hone your negotiating skills and get out there and save!

Do you really need ALL the bells and whistles?

The so-called “smart” appliances are cool, aren’t they? But, do you really need a refrigerator that tells you you’re running low on milk or to keep track of your shopping list?

Doing without the high-tech and high-priced bells and whistles can save you a ton of money.

Do your homework

Learn about the different models and read reviews to help you determine what you really need and what you can live without.

Consider pre-owned appliances

You know exactly what you want (if you followed our advice, above) so why not check the used appliance stores in your area or on Craigslist.org to see if someone just happens to be selling the exact model?

Items on Craigslist may not work as described, so ask the owner for a demonstration to ensure that it’s in good working order.

Although some sellers offer to deliver to your home, most don’t, so factor in the cost of transporting the appliance as well.

It’s just a little dent

The “open box” concept means that the appliance is in some way not fit to be sold as “new.”

Sometimes they are customers returns and others contain cosmetic defects.

The defect may be glaring or it may be minimal

Whichever it is, the appliance will be discounted – sometimes up to 50 percent off the regular price – because of it.

Display models are typically the least defective but are sold at a discount because they are “missing original packaging or instruction manuals,” according to Laura Harders at U.S. News & World Report.

You’ll need to do some driving around, from store-to-store, for the most part, although some dealers, such as Best Buy and Sears Outlet, list their open-box inventory online.

Look for rebates

Many manufacturers are offering rebates as well as other special promotions for Black Friday 2017.

Check the manufacturer’s website to learn the offerings. For instance, GE Appliances lists their specials here and you’ll find Frigidaire’s specials and rebates here.

In addition, Appliancesconnection.com offers a database of rebate offers by manufacturer.

Learn the art of the deal

Consumer Reports surveyed 2,000 adults and found that only 33 percent of them tried to bargain down the price of an appliance. Of those who did, 89 percent were successful.

One of the tactics hagglers use includes finding the item online or at another retailer for less and asking the store to price-match. If they won’t budge on price, ask for a free extended warranty, accessories (hoses, etc.) or complimentary delivery and setup.

Consider future costs

Woroch reminds us that quite often the lowest-priced appliance won’t save you money over the long haul. Sure, you’ll pay more for an energy-efficient model, but the future savings may make up for the extra dollars spent now.

Find out how much you can save each year with an energy-efficient model at energy.gov.

Skip the extended warranty

Consumer Reports cautions appliance shoppers not to pay for the extended warranty that will most likely be offered.

“Extended warranties can have many gotchas, relying on contract fine print to deny coverage for almost any reason,” they caution. “You’d be smarter to set aside the money you’d spend to cover repair costs yourself.”

There’s money in that old appliance

As handy as Craigslist.org is to buy items, it’s even better when you need to sell something. If the old appliance still works, consider selling it to offset the cost of the new appliance.

If it’s junk, consider parting it out to an appliance repair shop or sell it as scrap metal.

Learn how much your appliance may be worth as scrap metal and how to sell it at recraigslist.com.

By the way, Consumer Reports offers a handy buying guide for Black Friday appliance shoppers.

Tips to consider when buying a home with family members

The industry that brought you the iconic “location, location, location” has a new one for you: “multigenerational housing.” No, it’s not a new concept, but housing that caters to several generations under one roof is gaining in popularity.

We started seeing the demand during the recession, when unemployment propelled younger workers back to Mom and Dad’s house. Then, there’s the fact that millennials are tending to put off marriage and remain at home longer, according to Diana Olick at CNBC.

Immigration is also a driver of the multi-gen housing market. “In Asian and Hispanic cultures, multigenerational living is usually the rule. As these immigrants move to the U.S. in greater numbers, they bring the trend along with them,” Olick suggests.

Burns Consulting surveyed 20,000 homebuyers last year and found that 44 percent said they wanted room for their parents. Forty-two percent were parents wanting room for their adult children.

Thinking about moving in with your kids or your parents? Read on for some tips gleaned from the 51 million Americans who have done it.

Home shopping tips

The most important aspect to consider when shopping for a multi-gen property is privacy. Each member of the family should have some space to call his or her own that provides a place to retreat. This may mean building an “in-law” unit or constructing new walls to divide rooms.

You’ll need to look into the local zoning laws if you choose the former or find a large home to take advantage of the latter.

Lucky you if you choose a community in which home builders are catering to the trend. Lennar, for instance, offers NextGen homes, also known as The Home Within a Home®. They’re currently offered in 13 states (Washington, Oregon, California, Nevada, Arizona, Colorado, Texas, Minnesota, Florida, North and South Carolina, Virginia and Maryland).

The money stuff

Yes, it’s uncomfortable, but the financial aspect of the home purchase and ongoing costs are a discussion that needs to take place early in the process. And, the discussion should not be “a parent-kid thing,” according to John Graham, co-author of “All in the Family: A Practical Guide to Successful Multigenerational Living.”

He goes on to caution that families should aim to “level the hierarchy of the family,” treating each member as adults. Some of the topics of these conversations should include:

  • Who will buy the property?
  • How will title be held? It’s important to understand the different ways of holding title. For instance, what happens to the home upon the death of the primary buyer?
  • How much will each adult contribute each month to the mortgage payment?
  • Lists of each family member’s must-haves in a home and those he or she can’t tolerate.

Talk to your attorney to ensure you’ve discussed all the ramifications.

Talk to one another

Some families excel at open communication while others find it challenging. “The biggest factor in successful arrangements is communication,” Donna Butts, executive director of Generations United tells Sue Campbell, author of “The Aging Well Revolution: How new communities and technologies help us live.”

“You need to sit down before someone moves in and talk about expectations and parameters, including how you’ll divide up food, utilities and responsibilities. Another important question to ask is whether the situation is permanent or temporary,” Butts concludes.

Get clear on mutually-agreed upon house rules, preferably before everyone moves in together.

Dysfunctional families may find the thought of multigenerational living intolerable, but for those families who enjoy close ties and harbor respect for one another, it may just be the ideal lifestyle.

Get Help With Your Down Payment

It’s frustrating to have a decent-paying job, a bright earnings future and acceptable credit and still not be able to buy a home because you lack the thousands of dollars in cash needed for a down payment and closing costs.

The dreaded down payment stops more potential homeowners cold than any other aspect of the loan process.

To read articles about down payment headaches one would think it’s only millennials who have trouble coming up with the funds.

In reality, most would-be first-time homebuyers, regardless of age, find saving up 20 percent of hundreds of thousands of dollars challenging.

Sure, you may qualify for a loan with a lower down payment, but do you really want to add to your monthly house payment by purchasing the mandated private mortgage insurance policy? That’s what’s required if you don’t have 20 percent equity in a home you purchase.

Today, we’ll explore ways you can get help with the down payment on your new home.

Crowdfund your down payment

Enter, HomeFundMe CMG Financial, which offers a brilliant way for you to come up with that down payment: Crowdfunding – with the approval of Fannie Mae and Freddie Mac.

Before the crowdfunding concept came into being, lenders stipulated that your down payment and closing cost funds must come from your savings (mutual funds, stocks, IRA and 401(K) included), proceeds from the sale of another property, assistance from government programs or non-profits, union, employers or gift money from an immediate relative.

HomeFundMe allows anyone to donate funds to help you buy a home and CMG Financial provides the online platform.

While many crowdfunding endeavors offer a return on investment, the HomeFundMe program returns nothing to those who give. Money given is considered a gift, although they can make the gift conditional on the money eventually going to fund a home purchase.

The program offers incentives to savers, however. Attend credit counselling and education classes and you may receive a grant of up to $2,500. Then, the crowdfunding platform will match donations “$2 for every $1 raised, up to $2,500,” according to CNBC’s Diana Olick.

Get help from the government

The government, from local to county, state and federal, offers programs to help Americans get into home ownership. Some of these programs are geared toward the low-income applicant while others are open to all.

Federal Home Loan Bank

The Federal Home Loan Bank offers three programs to help homebuyers with their down payments and closing costs:

  • Home$tart® — Assistance up to $7,500 for borrowers who take the homebuyer education program and earn up to 80 percent of their area’s median income (find yours on HUD’s website). Unlike the aforementioned programs, these funds come in the form of a grant.
  • Home$tart Plus — $15,000 to borrowers who are currently receiving public housing assistance. Borrowers must complete a financial literacy program and be income qualified.
  • Native American Homeownership Initiative (NAHI) — $15,000 to eligible Native American households to help with a down payment and closing costs.

Good Neighbor Next Door

This program falls under the auspices of the United States Department of Housing and Urban Development (HUD) and offers a discount (typically 50 percent) off the asking price of a home. The program is open to applicants in the following professions:

  • Pre-Kindergarten through 12th grade teachers
  • Law enforcement officers
  • Emergency medical technicians
  • Firefighters

Be aware that this program only covers homes in HUD’s revitalization areas that are listed for sale through this program.

Learn more about the program and how to apply on HUD’s website.

State and local programs

FHA offers state-wide down payment grants through a variety of programs. Search for them here.

Search for local programs at Freddie Mac’s website.

The National Association of Local Housing Finance Agencies (NALHFA) suggests using downpaymentresource.com to find information on local assistance programs.

provides local-level program information.

Finally, several labor unions, such as the Culinary Union, offer homebuying assistance programs for members.

“Real Heroes Don’t Wear Capes. They Wear Dog Tags”

Sure, it’s a slogan on a t-shirt, and nobody has yet to take credit for it, but it sums up how we feel.

And, since Veteran’s Day – the day we celebrate our heroes in dog tags — is November 11, we’d like to take this opportunity to remind our current and former service members about the amazing VA home loan that is part of their benefits.

It’s curious that of 21.8 million veterans in the U.S., only 6 percent use their VA benefits to purchase a home.

So, we thought we’d take this time to remind active service members, veterans and qualified widows and widowers about this money-saving, homebuying program.

In fact, we feel that the VA loan might just be the best mortgage today.

Not only will you not be required to make a down payment, there’s also no mortgage insurance requirement, making the loan even less expensive. Then, there is the fact that veterans using this loan guarantee often get lower interest rates than they would with a conventional loan.

It does this not by directly lending money but by guaranteeing conventional lenders that a portion of the loan will be repaid should the buyer default. Since lenders are thus assured, they are able to offer our veterans more attractive rates and terms.

The Many Uses Of The VA Home Loan

Although purchasing a home is the most common use of a VA loan, the administration also offers programs for veterans to build homes, to simultaneously purchase and improve a home and to improve a home’s energy efficiency.

To be eligible for a VA-backed loan:

While many of the eligibility requirements for the VA loan are similar to conventional loans, others are less stringent.

  • The VA wants you to have “suitable credit.”
  • Your income must be enough to cover both your mortgage payment and your monthly bills.
  • The VA loan is only for borrowers who intend on occupying the home as their primary residence.
  • The borrower must obtain a valid Certificate of Eligibility, or COE for short. Many lenders can use the online ACE system and can provide the certificate almost instantly.

The borrower must also have a certain amount of residual income left after paying monthly credit debt. The amount is determined by region and family size.

For instance, in Minnesota, a family of five must have $1,039 left every month after paying their debt payments. If this family’s debt-to-income ratio (DTI), however, is higher than the maximum allowed, they will need more residual income to qualify.

Now, these are the VA’s eligibility requirements. Since the loan will be granted by a lender, you may face other requirements.

Here’s How Much You Can Borrow

The VA doesn’t set a maximum on the amount of money an eligible veteran can borrow but it does limit how much of the borrowed amount it will guarantee.

“In 2017, a qualified borrower generally can buy a home with a value of up to $424,100 with no down payment, though the actual amount varies by county,” according to Hal M. Bundrick, CFP at nerdwallet.com.

Now, this doesn’t mean you’ll automatically qualify for the maximum. The amount you’ll qualify for depends on a number of factors, including your debt ratio.

Determine your ratio by adding up your monthly debt payments (exclude items such as phone bills, utility bills and groceries) including your mortgage or rent, and dividing the sum by your gross monthly income. The maximum acceptable debt ratio is 41.

There’s a lot more to know and love about the VA-backed loan, so feel free to contact us. We’re happy to point you to a VA loan specialist who will walk you through the process.