Get Ready Now IF You'll Be Buying A Home in the Next Year

OCTOBER 13, 2017

By Novelda L. Sommers, Marketing Content Manager, The Long & Foster Companies.

If you’re already looking ahead to 2018 and planning to make it the year you buy a home, now is the time to start getting your financial house in order.

By giving yourself plenty of time to address any factors that could be dragging down your credit score, you can save thousands of dollars in interest over the life of your mortgage. Having stellar credit also gives you a better chance at sailing through the loan process and getting your offer accepted in a housing market that’s expected to continue to favor sellers.

Prosperity Home Mortgage offers tips for prospective homebuyers who are beginning the process of applying for a home loan. The company also makes mortgage consultants available, who will walk clients through the sometimes-complicated process of getting a mortgage.

At the outset, these are some measures you can take to make sure your credit is in good shape as you embark on the journey to homeownership:

See what’s in your credit files. Three major credit bureaus, Experian, Equifax and TransUnion, maintain detailed reports on our financial lives, and we’re entitled by law to see each one of those for free once every 12 months. You can access them through AnnualCreditReport.com. Don’t be fooled by look-alike sites. You can also get to the site through links on the government’s Federal Trade Commission or Consumer Financial Protection Bureau (CFPB) websites. Your credit report has a lot of information about you, such as previous addresses, loans you hold or have paid off, open lines of credit, bankruptcies, liens and judgements. It’s important to make sure all of that information is correct. One in five credit reports contain errors, and correcting them takes time, so don’t wait to check.

Dispute any erroneous information with the credit reporting company and the creditor who made the report to them. Find out more about what to include in your dispute documents at the CFPB’s site. The site has instructions, template letters and guides for how to go about this.

Find out your credit score. Check your bank and any credit card companies you use to see whether they offer a free FICO score or other credit score. You might need to pay for a one-time score from one of the credit bureaus or myFICO.com, just steel yourself for sales pitches for monthly credit monitoring you might not want or need. Scores usually range from 300-850, and the higher the score, the easier it is to qualify for a loan and get a lower interest rate. A great place to be is in the high 700s and up, but a lower score won’t necessarily keep you from getting a mortgage. You just might have to pay more for it, because a lower score places you in a category of borrower that’s at higher risk of defaulting.

What goes into a credit score? Commonly, it’s:

• 35 percent your history of paying accounts on time.
• 30 percent debt-to-credit ratio (how maxed out you are).
• 15 percent length of credit history.
• 10 percent credit mix.
• 10 percent whether you have opened accounts recently.

If you’re trying to bring your score up, it’s vitally important to pay all your accounts on time and make sure they stay current. You might be tempted to consolidate debt and close credit accounts, but that’s not always a good idea, because doing so can cause your debt-to-credit ratio to skyrocket, which makes you look maxed out.

For example, if you have two credit cards each with a limit of $10,000, and you are carrying a balance of $5,000 on one of them, then you close one of the cards, you suddenly go from using 25 percent of your available credit to 50 percent. A credit utilization rate below 30 percent is usually considered good.

You shouldn’t open new accounts if you’re about to apply for a loan. Especially avoid making any major purchases on credit. Don’t move a lot of money around between accounts, co-sign on another person’s loan, or change your job, name or address. Stability is key.

As long as your financial habits are healthy, your Prosperity mortgage consultant will recommend you continue using credit just as you normally would, because deviations can raise red flags.

Once your credit is optimal and you’ve gotten a mortgage preliminary approval from your lender so you know your exact price range, contact a Long & Foster real estate agent who can help you get the best deal on your ideal home.

Finding a Builder to Construct a Custom Home on your Lot

OCTOBER 18, 2017

By Suzanne Whitenight Pilcher, Marketing Coordinator, Long & Foster Companies.

Perhaps you were lucky enough to inherit property or bought a parcel of land to build your dream home. Now, how do you select the right builder to construct the home you’ve envisioned? Whatever style and size home you’re building, you’ll want to know you’re purchasing a good quality home from a reputable builder.

Where do you start?

It’s best to find companies who are familiar with the building codes in your area, according to Pauline Dent, director of builder & developer services with the Long & Foster New Homes division. Each jurisdiction has specific building codes, so you’ll want to hire someone who knows the codes and can comply with them. The National Association of Homebuilders offers a list of local builders on their website.  In addition, a real estate agent familiar with custom home building can be a great resource.

What’s the builder’s specialty and reputation?

Whether it’s a traditional colonial, modern or craftsman-style home you have in mind, take a look at pictures of the houses each builder has constructed. Ask how many homes they have built that are similar to the design you have in mind.  Then, go to see the products they’ve built in the last few years.

In addition, ask for personal testimonials from past clients. Dent adds you’ll want to talk to a variety of customers, in every stage of owning – meaning those that recently moved in, individuals who have lived in the home less than two years and people who have lived in their houses longer than two years. Ask them if the work was completed on time and on budget and if they had any major issues during construction. Your real estate agent may also have had some experience with the builder to help attest to their reputation.

How much will it cost?

Although it’s important to hire a qualified builder, finding one who can construct a home in your price range is just as critical. Gather quotes from the list of builders you’ve collected and be sure you understand what’s included in each quote. For instance, does the price include site and finish work, landscaping and clean-up of the property? What level of finishings will be included – will you have granite or laminate countertops?

Site work, including land clearing and grading, the construction of driveways and walkways, installation of utilities, permits and fees, can cost more than $60,000 in some areas, according to John Jorgenson, a leading new homes agent in Long & Foster’s McLean, Virginia, office. Check to be sure your builder includes it in the price or you’ll have to budget for these necessary costs.

Just as with any new home purchase, a knowledgeable Realtor can help you find a reputable builder and can guide you through the homebuilding process.

Before the Holidays - Check Home Maintenance Items

RISMEDIA, Monday, October 23, 2017— Twenty-four percent of home contractors recently surveyed by American Home Shield (AHS) reported Thanksgiving as the busiest holiday season for repairs and service. Get ahead of home maintenance with these tips from AHS:

1. Wake your heating system from hibernation.
No homeowner wants to wake up seeing their own breath because the furnace broke down in the middle of the night. Schedule a furnace check-up now with a heating system professional to ensure everything is running properly and that your system meets the manufacturer's rated efficiency. One of the biggest causes of wasted energy is restricted air flow to the heating system, so have a contractor check that the filters and coils are allowing for enough air flow. Getting ahead of this issue will help you avoid appointment delays during the busy winter season and give you peace of mind.

2. Give your gutters a fresh start.
Leaves, twigs and other debris can easily clog gutters, which can lead to ice dams. Ice dams cause melting water to back up and flow into the house, resulting in a very expensive repair. Save yourself the money and trouble by thoroughly cleaning out your gutters after the leaves have fallen. Make sure to tighten gutter hangers and downspout brackets, and replace any worn sections before it's too late. Check that downspouts extend at least five feet away from the foundation. If they don't, buy an inexpensive extension.

3. Mind the gaps.
Walk around the inside and outside of your home and check it for air tightness, carefully looking for any signs of cracks where air could leak out, as this can be a significant source of energy loss. An inexpensive tube of caulk can help seal the leaks and also help prevent moisture from getting inside the walls of your home. Caulk and seal air leaks where plumbing, ducting or electrical wiring comes through walls or floors.

4. Get smart—a smart thermostat, that is.
The Wi-Fi rage is real, especially when it comes to your thermostat. If you still have a manual thermostat or even a programmable one, consider upgrading to a smart thermostat. Today's models can learn your living patterns, heat only rooms that are occupied, turn up the heat as you near your home, allow you to make adjustments remotely from your phone, and much more. According to the U.S. Department of Energy, you can save as much as 10 percent a year in energy usage (and on your utility bills) by making smart adjustments to your thermostat.

5. Double-check doors
Inspect all doors that open to the outside or to the attic and be sure that they close tightly. An easy way to check for air leaks: place a piece of tissue in a clothespin, hold it at various points along the doorway and watch for any movement near the edge of the door and the frame. If you have a leak, take a photo of your door and door jamb, and ask an employee at your local hardware store for help finding the right weatherstripping or door sweeps. Air leaks cause your heating system to work harder, which costs you more money on your utility bills—and can shorten the lifespan of your system.

Source: American Home Shield®

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