Why Holiday House Hunting Makes Sense

Yeah, we get it. The weather outside is frightful. You haven’t even started holiday shopping. Family is expected any minute. Why in the world would you start looking for a home now — or worse, or in the dead of winter?

Most families wait for the spring market to rev up. More houses are available and that means it’s easier to find a great deal, right? Not necessarily. Here’s why.

The winter can be a great time to purchase a home, especially for buyers without kids or with grown children. No worries about changing schools or making sure they get enrolled for the fall.

There is also a lot less competition. Last year’s peak market had buyers waiving home inspections and increasing down payments — doing whatever they could to get a leg up on other eager buyers while making purchases nearly impossible for those on a tight budget. Because of this, waiting for the spring market can be a mistake. Winter can be a very good time to buy.

So yes, the spring has more inventory, but that brings more buyers. When you look for homes at this time of year, you’ll have a better chance at avoiding aggressive bidding wars. Sellers who list during this time are typically ready to move as soon as possible due to job changes, relocating, downsizing or retiring. They tend to be less ambitious in their asking price. And although it’s never a guarantee, interest rates tend to be lower in a softer market.

If your Thanksgiving dinner conversation includes a friend or family member talking about buying a home — or if you’re considering it yourself — please give me a call at 617-965-1236.

Ready to buy a new home or refinance the one you own? Please get in touch and I’ll be happy to answer your questions and help guide you through the process. I look forward to speaking with you.


Happy Thanksgiving!

I wanted to take a moment to express my gratitude for all of you — friends, family, colleagues and clients.

You have supported me and made Westchester Mortgage successful for many years. I am so grateful for the friendships, connections, and long-lasting, meaningful relationships I’ve built with so many of you over the years. It means so much to me!

My favorite part of my work is helping those who needed guidance in getting approved for a mortgage. People who had no idea that together we could figure out how to come up with a down payment, or navigate through all the variables related to their homes and finances following a divorce or breakup. These are the times I feel like I’m making a difference in peoples’ lives. It means everything to me. I am truly thankful.

So whether you’re celebrating with family and friends or going it solo this year, I wanted to wish you all a wonderful, healthy and happy Thanksgiving.


Thanksgiving Home Improver: The Great Cranberry Sauce Debate

It’s that time of year again. Forget about turkey, football, and family — and avoid talk of politics entirely if possible. Instead, focus on that other hot topic that’s become a Thanksgiving tradition: canned or fresh? Yes, it’s time for the Umpteenth Annual Great Cranberry Sauce Debate.

Let’s not kid ourselves here. Fresh cranberry sauce is the only choice for foodies with sophisticated palates. It has the consistency of jam and let’s be honest–it’s far more of an actual sauce than the tart, jellied blob that comes a-slidin’ out of the can. When it comes to pure fruit flavor, there is no debate: fresh cranberry wins in a landslide.

But there’s another side of the argument. For many generations, canned cranberry sauce is both a tradition and a guilty pleasure. Just look at it. It retains the shape of the can, including those lines which canned purists feel adds some extra texture and mouth feel that takes them back to the happy and carefree days of their youth.

Here’s our take: Yeah, we get it. Fresh cranberry sauce tastes great. However, Thanksgiving comes but once a year, and it’s a holiday of family and traditions. That’s enough for us. Slide out that bouncy jellied blob, slice it up and serve it next to the turkey and stuffing!

Is Zillow the Uber of Real Estate?

There’s no question that Zillow.com has evolved from a real estate curiosity to a major player in the industry. While some may think of it as a starting point for future homebuyers or simply an entertaining way for house-hunters to kill some time online, Zillow is emerging as a force that could disrupt the entire real estate process. In fact, it already has.

If you’re wondering if Zillow will eventually displace real estate agents, I suppose it’s possible, though highly unlikely — and it would be years away if Zillow were to consider such a pivot.

The more likely lasting scenario is their current model, which uses real estate agents the way Uber uses vetted drivers to close business for them.

Here’s how it works: Zillow sells leads to agents backed by large real estate brokers like Keller Williams, Re/Max and Coldwell Banker. Users sign up and explore locales where they want to buy. Zillow provides their “Zestimate,” which is sometimes less of an estimate and more of a guesstimate. Eventually, Zillow will suggest one of their recommended agents to work with the homebuyer, gather as much accurate data as they can and seal the deal. So the agent gets paid, but so does the broker and now Zillow gets their cut.

Now, whether these agents are any good at selling is no guarantee. The agents Zillow recommends are the ones paying thousands of dollars a year for leads. They are not necessarily the cream of the crop, though some are. Bottom line: it’s a crapshoot.

And that’s the risk you take when starting with software rather than a human. Real estate is almost always an emotional purchase and you need a sentient human to make it all work. Zillow knows that and that’s why they invest in human capital to power their sales engine. At least for now.

Ready to buy a new home or refinance the one you own? Please get in touch and I’ll be happy to answer your questions and help guide you through the process. I look forward to speaking with you.

Pre-Approval Letter vs. Loan Commitment

From time to time we use this space to clear up industry
terminology. Recently I was asked about the difference between a pre-approval letter and loan commitment. Both are similar, yet there are subtle differences between these two mortgage terms and they should not be used interchangeably.

Let’s start with pre-approval letters. These are nearly mandatory in today’s real estate market and have been in existence for more than two decades.

A pre-approval letter is submitted by the buyer along with their purchase agreement. Its primary purpose is to assure the seller that the potential buyer has met the basic criteria to be granted the mortgage. The buyer’s income, credit score, debt levels and down payment source are verified at this time.

On the other hand, a loan commitment letter is created when the buyer’s information has been fully reviewed and he or she has been given the clearance to close on the sale. Occasionally, a loan commitment letter is issued along with additional conditions which must be met before they are cleared to close.

The loan commitment letter protects both the seller and the buyer from financing issues that may crop up prior to the closing. So what issues can occur from the time of the pre-approval letter? The biggest concerns are loss of income and credit problems that may lower your score.

Ready to buy a new home or refinance the one you own? Please get in touch and I’ll be happy to answer your questions and help guide you through the process. I look forward to speaking with you.

Buying a Home? Ask About Murderers and Ghosts

Remember “The Amityville Horror”? It was a huge late-1970s bestseller and movie about a family that was terrorized by a house of evil spirits. It turned out to be a hoax, but there was one part of the story that was just as terrifying, yet absolutely true.

In 1974, 23-year-old Ronald DeFeo, Jr., used a rifle to kill his parents and four younger siblings as they slept in their large Dutch Colonial home at 112 Ocean Avenue in Amityville, N.Y. The house remained empty until it was purchased by the Lutz family 13 months later at a bargain price of $80,000.

When notorious murders make headlines for weeks or even months, homebuyers typically know what they’re getting themselves into. But what happens when someone dies in a house by way of murder or natural causes? Does the real estate agent have to disclose this potential deal-breaker to the buyer?

Yes and no.

According to an article on boston.com, real estate agents are “not required to affirmatively disclose that there might have been a homicide or suicide on the property.” This means that they are not required to offer the information, but they are expected to confirm the information if asked. So, ask.

The article goes on to talk about paranormal activity, which is another little detail that may be left out by an agent looking to unload a property that may or may not have a few ghosts rattling chains in the master bedroom at midnight.

If you’re a buyer, do your homework before you embark on a tour of available properties. If you’d like help creating a list of questions, please get in touch.

Ready to buy a new home or refinance the one you own? Please get in touch and I’ll be happy to answer your questions and help guide you through the process. I look forward to speaking with you.

5 Home Improvement Ideas That Increase Value

Does your home need a few tweaks before putting it on the market? Let’s take a look at the top ways to increase your property value, even if you’re staying in your home for the next several years.

1. Kitchen Remodel. Here’s an opportunity to improve one of the most important rooms in the home from a buyer’s perspective. New cabinets and countertops, energy-efficient appliances, and beautiful floor covering can instantly increase value. But be careful–don’t go too far with your changes. They should be in line aesthetically with the rest of the home and the neighborhood.

2. Bathroom Addition. Only one bathroom in the home is a big negative for buyers. According to HGTV, adding a new bathroom can net you up to 130% of your investment.

3. New Windows. Here’s one of the most underrated home improvement ideas. Energy Star-rated windows save on heating costs (as much as $500 annually) and yield a green energy tax credit of 10%.

4. Closet Space. Storage is often an issue for families and spacious walk-in closets are big selling point for potential buyers. Even small changes like additional shelving and hooks can make the most of limited closet space. Don’t underestimate the need for proper storage, especially for homebuyers with one or more children.

5. Curb Appeal. When we think of increasing property value, we often focus on the dwelling itself and overlook the all-important first impression people have when seeing your home from the outside. Even before walking through the door, you’ll need to present a well-lit, painted (or sided) home with a manicured lawn, trimmed hedges, and a clean, family-friendly backyard. A landscaper is a good start, but consider a landscape designer first if your home needs a new look from the outside.

Home improvements can be costly but necessary for a solid ROI. Need help figuring out how to finance them? I can help. Call me at 617-965-1236.

Ready to buy a new home or refinance the one you own? Please get in touch and I’ll be happy to answer your questions and help guide you through the process. I look forward to speaking with you.

3 Downpayment Myths Debunked

When it comes to mortgage downpayments, there seems to be some confusion about how much you really need to put down on a new property. Let’s take a look at three common misconceptions.

1. The 20% Rule. If you were to ask the average person on the street about downpayments, the majority of them would say 20% is required. While 20% is a common guideline, it’s not necessarily the reality. In fact, there are a number of low downpayment programs available.

2. It Has to be ONLY my money. Gift funds are a great option. A gift may be provided by a spouse, child, or anyone related to the borrower. It must specify the dollar amount and an official gift letter is required stating that the funds were a gift and no repayment is expected.

3. First-time Homebuyers Only. While the industry has always encouraged first-time homebuyers, it’s a myth to think current and previous homeowners will be forced to submit 20% and not a penny less. I have worked with numerous clients over the years who have preferred a smaller downpayment so they can keep some money for repairs and additions to their new home.

Don’t be fooled by these misconceptions that have seeped into the general consciousness. There are more options for low downpayments than you may have imagined. If you or someone you know would like to explore the possibility of a low downpayment option, I can help. Call me at 617-965-1236.

Ready to buy a new home or refinance the one you own? Please get in touch and I’ll be happy to answer your questions and help guide you through the process. I look forward to speaking with you.

The One Question That Saves Thousands of Dollars

I’ve been working with homeowners for many years and I discovered long ago that eager buyers set themselves up to fail by taking the wrong approach in their excitement of making what is often the largest purchase of their lives.

Whether I’m advising couples, divorced women, single men or anyone else across all demographics, the majority of these home buyers start house-hunting with the amount of money in mind that has been determined with their pre-approval. It’s a mistake and can lead to serious financial issues.

The question I start with is a simple one: What do you need to live happily and comfortably over the next several years? That change of mindset–focusing on their needs rather than what the bank tells them they can afford–makes a huge difference.

Let’s face it: in many ways, we are a nation of impulse buyers. Why buy a Toyota when you can buy a Lexus, right? I’ll tell you why. Because you can’t afford it. You only think you can.

First-time homebuyers often find themselves in serious debt when they learn of unexpected costs to maintain their homes in addition to their monthly mortgage payment, property taxes, utility bills and more. Then suddenly one winter they have ice dams and roof repairs and mold remediation. The typical homebuyer thinks of a dream home, not a nightmare scenario that stretches their budget to the limit and beyond.

When buyers work with me they have a professional who helps them make practical decisions that will serve them well over the life of the mortgage. Consider me the reality check you never asked for, but really need. You can’t put a price on good advice, but you can always afford it. I’m happy to help.

Ready to buy a new home or refinance the one you own? Please get in touch and I’ll be happy to answer your questions and help guide you through the process. I look forward to speaking with you.

Appraisal vs Assessment: What’s the Difference?

The difference between an assessment and an appraisal is significant. The two words are not interchangeable, contrary to popular thought. A look at each of these terms will show two very different looks at your home’s value.

An appraisal determines the market value of a specific home at a specific time. The appraiser determines this value based on recently sold homes within the past 90 days. They are of equal (or similar) comparison and are located within approximately one mile from your home. Adjustments are made for differences that might include location and square footage as well as the number of bathrooms.

An assessment, on the other hand is notably different. It is determined by the town or municipality to set property taxes. The amount of taxes you’ll pay is based on the assessment. But here’s the thing: the number is based on stats from previous fiscal years.

For example, a home sold in 2016 has a tax assessment based on sales from 2013 or 2014.

In a nutshell, an appraisal is based on very recent sale prices and are used to determine value. Assessments are based on the past and are specifically used for taxes.

I hope this helps clear up any confusion. If you need further clarification, please contact me at 617-965-1236.

Ready to buy a new home or refinance the one you own? Please get in touch and I’ll be happy to answer your questions and help guide you through the process. I look forward to speaking with you.

Second Home vs. Investment Property

If you ever hear someone say they are interested in buying a second home as an investment property, stop them right there. A second home and an investment property are not the same thing. There are several distinctions that set them apart. Let’s take a look.

A second home is just what it sounds like: another location for you to reside at various times of the year. So let’s say you own a home in Needham but you’re interested in buying a winter home in Miami. That falls into the “second home” classification.

An investment property, on the other hand, is intended to generate a return on investment, either through rental income or resale (or both). Examples of investment properties include two-family houses and renovation/flipping projects.

To avoid charges of fraud, your second home should be a considerable distance from your primary residence. The rule of thumb is approximately 50 miles (Wellesley to the Cape, for example, is about 80 or 90 miles.) A two-family second home is unlikely to be approved because it is, by design, intended to be a revenue generating property.

A downpayment on a second home carries less risk and therefore may be the home purchase you can make with the least amount of money down. Your downpayment on an investment property, however, will be higher because the risk is higher. The two-family investment is viewed as a risk by the banks because you’ll be counting on the rent coming in. There’s no guarantee of tenant reliability or year-round occupancy.

I hope this helps clear up any confusion. If you need further clarification, please contact me at 617-965-1236.

Ready to buy a new home or refinance the one you own? Please get in touch and I’ll be happy to answer your questions and help guide you through the process. I look forward to speaking with you.

FHFA Increasing Loan Limits in 2017

There’s some good news for those homebuyers looking for a larger loan amount in 2017. The Federal Housing Finance Agency recently announced that loan limits for are rising. The limit on conforming loans moves up from $417,000 to $424,100. This is the first increase in the baseline loan limit since 2006. That’s good news for those of us in the industry, but it’s better news for homebuyers.

A conforming loan — not to be confused with a conventional loan — is a mortgage loan that follows Fannie Mae guidelines. On its surface a $7000 increase may not seem like much when considering a $400,000 mortgage, but that extra bit of cash can come in very handy for those seeking the best financial advantage as possible when purchasing a new home.

Loans that exceed this new limit are considered high balance loans. This translates to higher pricing with the least flexibility. Staying under the cap will get a mortgage with the most underwriting and highest flexibility. Nonconforming or jumbo loans carry a higher interest rate than conforming loans, increasing monthly payments and negatively impacting affordability.

The new loan limit will allow more buyers to borrow more money without having to put more money down. Homeowners can refinance bigger loan sizes while staying within the conforming loan limits.

This increase comes at a time when mortgage rates have increased slightly to just over 4.0%. That’s still an excellent rate, compared to 6% in 2008 and 8% in 2000.

This bodes well for the real estate industry as a whole, with the Federal Housing Finance Agency showing greater confidence in the recovery of home prices across the country. 2017 will be another great year for homebuyers.

Ready to buy a new home or refinance the one you own? Please get in touch and I’ll be happy to answer your questions and help guide you through the process. I look forward to speaking with you.