People who experience a property loss are usually asked by their insurance company for proof of purchase, which can come in the form of a receipt or current inventory of their personal belongings.
Even the most organized people might find it challenging to find receipts for all the valuables in their home. If the inventory isn’t up-to-date, a homeowner might forget to add some items to the claim and may not recognize the omission until long after the claim is settled.
The inventory can serve as a guide to make sure a homeowner gets compensated for all the loss.
Photographs and videos can be adequate proof that the items belonged to the insured. A series of pictures of the different rooms, closets, cabinets and drawers are helpful. When video is used, consider commenting as it is shot and be sure to go slow enough and close enough to things becoming recorded.
For your convenience, download a Home Inventory, complete it, and save a copy off premise. Good places for your inventory could be a safety deposit box or digitally, in the cloud if you have server-based storage available like Dropbox.
There seems to have been an accepted progression for homeowners going from starter home, to gradually moving into one’s dream home, then, downsizing after becoming an empty nester and finally, into a retirement home. However, Marianne Cusato’s 2016 Aging-in-Place Report indicates that many older Americans don’t plan on following that pattern.
61% of homeowners above the age of 55 intend on staying in their homes indefinitely. 2/3 of them believe that the home’s layout will serve their needs without having to make aging-related improvements.
Some of the reasons being cited for staying in place are:
- 66% say their home is conveniently located
- 38% say they live close to their family
- 68% say they feel independent in their home
- 54% say they are familiar with their neighborhood
- 66% say the feel safe in their home
Typical renovations that might be considered for their current home are things like grab bars in the tub or shower, shower seats, taller toilets, handheld showerheads and additional handrails on stairways.
It seems that the report’s conclusion is that regardless of a homeowner’s age, they want to thrive in their home. The same emotional reasons which cause a person to want to buy a home are also reasons that cause them to hold onto it if practical.
There is a common body of knowledge among real estate professionals that indicates that the longer a home is on the market, the lower the price will be. Many sellers discount this belief in the beginning because they feel confident their home will sell quickly.
Lowering the price is the most obvious thing that can be done to encourage buyers, but it might be good to look at what builders do. Builders offer a variety of incentives such as upgrades, seller-paid closing costs, interest rate buy downs, washers, dryers, refrigerators or big screen TVs.
Interestingly, much of the resale market doesn’t employ these techniques. According to the latest NAR Home Buyers and Sellers Profile, 64% of sellers did not offer any incentives at all.
21% of sellers offer a home warranty. 16% of sellers offered assistance with closing costs and 6% offered credit toward remodeling or repairs.
The attached chart indicates that while 80% of sellers were not willing to offer incentives in the beginning of their marketing period, as weeks passed and their home hasn’t sold, close to half did add incentives.
The ideal outcome is to maximize proceeds in the shortest time possible with the fewest unexpected issues. This involves having a firm understanding of current, local market conditions and crafting a marketing plan that targets desired results. Incentives aren’t always a key element, but at least reviewing any that might be a competitive edge early rather than later could be worthwhile.
There is usually much at stake in selling a home and value may be added by consultation with a trusted and knowledgable local real estate professional early on.
The ironic thing when people think they can’t afford to buy a home for themselves, they end up buying the home for their landlord. There are several facts that support this notion.
Mortgages, whether held by an owner-occupant or an investor, are usually amortized so that each payment reduces the principal amount owed so that the loan will be repaid totally over the term. A tenant is effectively retiring the landlord’s mortgage with his monthly rent.
In most cases, the mortgage payment including taxes and insurance will be lower than the rent tenants are paying. Some experts are saying that we may never again experience the incredibly low mortgage interest rates currently available. “Never” is a very long time, but then again it’s been an incredibly long time since interest rates have even been up to the historical average.
Renting precludes a person from enjoying the advantage a home has as a leveraged investment. When the borrowed funds cost less than the investment is returning, the rate of return on the down payment grows much faster. As you can see from the chart, a 2% appreciation on a home could result in big returns on the down payment. In most cases, there are very few or no alternative investments that offer homeowners similar returns.
Even if a buyer agrees with all of these things but doesn’t have the down payment or cannot currently qualify for a loan, they still need to investigate further. To find out exactly what types of loans are available and the specific down payment required, usually far less than 20%, they need to consult with an experienced, trusted loan professional. (An Internet lender or a “BIG” bank may not be the best choice.) Call for a recommendation.
- “It’s impossible to get low down payment loans.” – MYTH!
FHA down payments are 3.5% and VA is 0%. In some areas, there may be some 0% down payment USDA loans available. FNMA and Freddie Mac have 3% down payment programs.
- “It takes perfect credit to get a loan.” – MYTH!
There is a relationship of better rates to better credit but many issues on a credit report can be explained or corrected. The way to know for sure is to speak to a reliable lender.
- “If I’ve had a bankruptcy or foreclosure, I can’t qualify.” – MYTH!
Credit history following a bankruptcy or foreclosure is very important and there can be extenuating circumstances. It only takes a few minutes with a reliable lending professional to find out if your individual situation will allow you to qualify for a new mortgage.
- “Getting pre-approved is expensive.” – MTYH!
Usually, the only expense to getting pre-approved is the cost of the credit report which could be around $35. The advantage is not only that you will know you qualify for a particular mortgage amount, an agent serving you needs to know it, and the seller of the property you want to buy will want to see written evidence of it from a reputable mortgage lender.
- “I should wait to qualify until I find a home.” – MYTH!
It can take weeks to qualify for a mortgage especially if there are issues that need to be corrected. The best interest rates are only available for the highest credit scores. It is to your advantage to start the qualifying process early in your home search. Pre-approval is really the first step of the process and usually expedites the loan processing time once your loan application is formalized. Should you identify the home you want to buy quicker than anticipated, lacking a written pre-approval statement to supply with your offer can seriously compromise your negotiating position. The worst consequence of not finding a home to buy before your financing pre-approval expires, usually after 90 days, is that you may have to re-submit some documentation and/or pay a nominal fee to get your credit report updated.
- “All lenders are the same.” – MYTH!
Reliable lending professionals will explain the entire process before collecting fees, quote fees up-front, have competitive products, do what is necessary (within regulatory and ethical bounds) to get the loan approved and close at the locked rate and terms. Ask for recommendations from recent borrowers or a trusted Realtor.
- “Adjustable Rate Mortgages are more expensive than fixed rate mortgages.” – MYTH!
Adjustable Rate Mortgages can be less expensive than fixed rate mortgages if the buyer’s circumstances warrant it. If a buyer is only going to be in a home for a few years before selling, it can be determined if an ARM loan will result in the lowest way to finance the property. There are many variables and you need to be aware of them before deciding which type of loan to finance your home purchase. This, far more than extensive comparison shopping online for a rock-bottom interest rate quote, is a worthwhile expenditure of your time and effort. Most reputable mortgage originators with local presence in the community are glad to serve in this way and welcome a request to meet in person.
Buyers and Sellers need solid information to make good decisions. Call me with your questions or to get a recommendation of a reliable lender who can give you the real facts.