CENTURY 21 AA Realty Blog

CENTURY 21 AA Realty Blog

Raising a ‘Fair’ Credit Score to ‘Very Good’ Could Save Over $45,000

A good credit score benefits consumers in many ways. In fact, it can even save you hard-earned cash. According to a recent study from LendingTree®, raising a 'fair' credit score to 'very good' could in fact save consumers more than $45,000.

To arrive at this figure, LendingTree researchers analyzed anonymized loan request and average loan balance data from LendingTree users to see how a lower credit score can increase borrowing costs for the average American with a fair versus excellent credit score. The analysts compared the range of credit scores generally considered "fair" (580 to 669) to the range generally considered "very good" (740 to 799) to measure the difference in costs of the life of loans using the average balances for five different kinds of loans (mortgage, student loan, auto loan, personal loan and credit card).

The results revealed the following:

– Raising a credit score from "fair" (580-669) to "very good" (740-799) saves $45,283 on a common array of debts.

– Mortgage costs account for 63 percent of the savings ($29,106 in savings with very good credit score versus fair).

– Paying the minimum balance on an average credit card debt represents the second largest difference, with about $5,600 in savings for a very good versus a fair score. That amounts to someone with fair credit paying 248 percent more in interest than someone with good credit.

– Personal loan borrowers can expect to pay 271 percent more interest on the same loan if they have a fair credit score instead of a very good one, and auto loan borrowers can expect to pay 311 percent more in interest.

The Most Common Debts
Everyone's debt profile is different, but it's typical for an American consumer to buy a condo or house (average mortgage size: $234,437), purchase a reliable car (average loan size: $21,778), take out a personal loan to consolidate old debt (average loan size: $11,258), rack up charges on a credit card (average debt size: $5,265) and pay off some student loans (average debt size: $37,525). That adds up to $310,263 for a lifetime of common American debts. A few things about that figure:

– While the average American may not have $310,263 of debt all at once, it's still common for borrowers to overlap some or all of these debts at the same time or in close sequence.

– It's likely a low estimate of lifetime American debt, because consumers often have more than one loan of each type throughout their lives.

Still, $310,263 is a lot of money, especially when considering how much all of that debt costs in interest and fees. Assuming a borrower pays every one of these bills on time, this range of debt will cost someone with a very good credit score (between 740 and 799) $212,498 in interest. With a fair credit score (between 580 and 669), a borrower is still likely to qualify for similar loan amounts, but can expect to pay around $257,781 in interest and fees, a difference of $45,283.

To put that in perspective, the median earnings for Americans in 2016 was $31,334, before taxes. It would take most Americans well over a year to collect $45,283 of interest via take-home pay—money they would never have to pay if they had good credit.

Even with only one of these loans, the borrower would still see significant savings with a very good credit score. Take a mortgage for example. Assuming every other factor is equal, someone with a very good credit score would have a monthly mortgage payment that’s $81 less than someone with a fair credit score. The person with very good credit could invest that money, use it to pay down debts faster or to increase the down payments on future loans, which would exponentially increase the value of those savings over that same 30-year period.

The solution? Credit monitoring, says LendingTree. By keeping a consistent eye on your credit score, consumers can see changes to their score, catch errors and take immediate steps to improve their score.

Century 21 AA Realty Long Island

Reprinted with permission from RISMedia. ©2018. All rights reserved.

5 Ways to Prep Your Lawn for Fall

Summer is winding down, and as your grass grows even greener, it's time to start thinking about how you can prepare it for fall, especially if you plan to stage your home for sale. Pay mind to the following tips on late summer lawn care.

Aerate the area. Late summer/early fall is a great time to aerate your soil so that oxygen, water, and fertilizer will better penetrate your grass' roots and support it as sunlight dwindles.  

Mowing matters. You'll want to keep mowing all summer and into fall, but as the days shorten, move your mower blade to the lowest setting to trim the grass tight and let more light reach the crown of the grass. Bonus: less length in your grass means less leaves to turn brown come winter.  

Weed, weed, weed. Take some time each weekend to weed your lawn all summer, to boost your grass growth and set it up for a healthy fall season.

Lose the leaves. Raking leaves can be hard work, but doing so will save the life of your grass. As leaves begin to come down in late summer, clear them off to support your lawn.

Fertilize in fall. When fall hits, experts agree it's time to fertilize, delivering essential nutrients to allow your grass to grow deep roots and a healthy reserve for next spring.   

Century 21 AA Realty Long Island

Reprinted with permission from RISMedia. ©2018. All rights reserved.

The ABC’s of FHA Loans

By Barbara Pronin

Like all mortgage loans, FHA loans require proof of steady income and employment as well as a minimum down payment. But they are attractive to consumers because they are government-backed, offering more attractive interest rates and less stringent qualification requirements.

Beyond that, how much more can you share with your clients about FHA loans? Here are seven fast facts to help you brush up:

  • Credit requirements – With a credit score of 580 or higher, a borrower can qualify for an FHA loan with a down payment as low as 3.5 percent. Those with scores between 500 and 579 need down payments of 10 percent. Under certain circumstances, such as insufficient credit history, exceptions may be made. Check with an FHA specialist.
  • Down payment funds – In addition to using their own savings, borrowers can use a gift from family members and/or an assistance grant from a state or local government to make the down payment.
  • Closing costs –The FHA allows sellers, builders and lenders to pay some of the borrower’s closing costs, such as appraisal, credit report or title expenses, as an incentive for the borrower to buy the home.
  • FHA-approved lenders only – Because the FHA is an insurer rather than a lender, borrowers must get their loan from an FHA-approved lender.
  • Mortgage insurance – Two mortgage insurance premiums are required on all FHA loans. The upfront premium is 1.75 percent of the loan amount, which can be financed as part of the loan amount. The second, called the annual premium, is paid monthly. It varies based on the loan amount, the length of the loan, and the initial loan-to-value (LTV) ratio.
  • Cash for repairs – A special loan, called a 203(K) loan, is available to borrowers who need extra cash to make home repairs. The loan amount is based on the projected value after repairs are made rather than on the current appraised value.
  • Loan limits – The FHA changes the maximum or minimum loan limits (called the ‘ceiling” and the ‘floor’) limits for FHA loans each year in response to shifting home prices. The limits are announced by HUD prior to the upcoming year.

Barbara Pronin is an award-winning writer based in Orange County, Calif. A former news editor with more than 30 years of experience in journalism and corporate communications, she has specialized in real estate topics for over a decade.

Century 21 AA Realty Long Island

Reprinted with permission from RISMedia. ©2018. All rights reserved.

The Benefits of Homeownership

June is National Homeownership Month, “a time to celebrate and promote the modern American Dream of owning a home,” says National Association of REALTORS® President Elizabeth Mendenhall, a sixth-generation REALTOR® from Columbia, Mo., and CEO of RE/MAX Boone Realty. “Homeownership changes lives and enhances futures, and many Americans see it as one of their greatest hopes. These individuals are counting on the nation’s 1.3 million REALTORS® to champion and protect homeownership and help make it more affordable, attainable and sustainable.”

In addition to the obvious benefit of providing shelter, owning a home has a far-reaching ripple effect for owners and their families. Here are just some of the many long-term benefits of homeownership:

  • Owning a home is a secure long-term investment. While markets fluctuate over the short-term, provided you stay in your home for an extended period of time, it will most likely increase in value and yield a substantial return on your investment, making it one of the safest ways to invest your money.
  • You’re building equity. As the experts at discover.com explain, when you subtract the amount you owe on your home loan from the total value of your house, the amount left over is your home equity—the dollar value that actually belongs to you. You build equity by reducing the amount you owe on your loan with each monthly mortgage payment, and also as your home increases in value.
  • You benefit from tax deductions. Even though certain tax deductions were at risk during this year’s tax reform bill, homeowners still benefit come tax time. Talk to your accountant to find out exactly if and how the new tax laws might affect your deductions.
  • Aside from the financial benefits, homeownership has a wide range of positive effects on families. According to reports from the U.S. Department of Housing and Urban Development, the children of homeowners tend to do better in school and are less involved in crime, as homes provide a stable environment for families.

With credit criteria loosening, and the recent roll-back of lending restrictions imposed by the Dodd-Frank Act, there are many options to pursue homeownership. Talk to your local real estate expert about the best way to get on the path to owning a home.

Century 21 AA Realty Long Island

Reprinted with permission from RISMedia. ©2018. All rights reserved.

In the Market for a House? A Quick Guide to Home-Buying This Spring

By Kara Masterson

Editor’s Note: This was originally published on RISMedia’s blog, Housecall. See what else is cookin’ now at blog.rismedia.com:

It’s an exciting milestone in a young person’s life to be on the cusp of purchasing a first home. If this is where you are at the moment, you probably have mixed feelings ranging from thrilled to anxious. That’s understandable, as this is a big purchase that will change your life forever.

To help you, here’s a quick guide that’ll make you better prepared as you begin your search:

Timing Is Everything
The natural first step to buying your first home is to determine if this is really the best time for you do so. While renting might not be a long-term solution, it may be what’s best for you given your current situation. You just want to make sure that you are at a place in your life where homeownership is really within reach. If it is, and you feel confident that you are ready, then it’s time to proceed.

Consider Your Finances
You might fall in love with a certain home, but struggle every month to make the mortgage payment. This is no way to live. You want to end up with a home that is well within your budget. Figure out what you are comfortable with spending and then only look at homes in that range. Do not get talked into buying more home than you can afford.

Work With a Real Estate Agent
There is no need to look around for the best home on your own. Real estate agents have a special knowledge of the market. Work with an agency and let them know what you are looking for. They will then compile a list in preparation for scheduling some viewings for you.

Shop Around for the Best Deal
Most people looking to sell real estate are willing to negotiate their price a little bit. Keep that in mind. In addition, some homes are over-priced, while others are under-priced, so you obviously want to aim for the latter, while still finding a great property in the location of your choice.

If you can follow this short guide, your path to homeownership will be within reach. The key is to take it slow and make sure that you’re confident in your final decision. You want a home that you’ll be comfortable in for the long term, and one that you can easily afford. Accomplish both of these objectives and you will be set for a happy future.

Kara Masterson is a freelance writer from Utah covering Diane Stowe for the real estate industry. She enjoys tennis and spending time with her family.

This article is intended for informational purposes only and should not be construed as professional advice. The opinions expressed in this article are those of the author and do not necessarily reflect the position of RISMedia.

Century 21 AA Realty Long Island

Reprinted with permission from RISMedia. ©2018. All rights reserved.

Creating Appeal: 8 Home Staging Tips That Work

By Barbara Pronin

First impressions count – and experienced real estate professionals know that a clean, attractively organized home will pique buyer interest and sell more quickly than its neighbors.

“Clients tend to focus not on what the house could potentially become, but on how it looks on their first walk-through,” said Kathy Murphy, a top-performing agent with in Royal Oak, Mich. “If the front door is peeling, or the kitchen is a mess, that’s the way they will remember it.”

Staging a home to show at its best can make a remarkable difference. That’s why most agents work with their sellers to help create maximum appeal. Effective home staging can be accomplished without excessive effort or expense. The work should begin before the listing photos are taken, so that buyers are intrigued when they view the home online.

Listing agents can broaden their staging know-how with these tips from home staging experts:

  1. Start at the street – Curb appeal is more than a catchphrase. Advise your sellers to be sure the lawn is mowed, flowerbeds are neat, bikes and trash cans are stashed away. Paint, replace, or clean the front door as needed, and set off a drab entry area with a potted plant or two.
  2. Freshen the entryway – The second most important impression begins just inside the front door. Lights should be on, the area neat, and a vase of fresh flowers on a foyer table is a nice touch.
  3. Get rid of clutter – Most homes have too much furniture and far too many accessories. Suggest your seller rearrange the furniture to create better traffic flow, and consider putting a quarter of it in storage. Thin out bookcases and closets, because jam-packed spaces give the impression they are too small.
  4. Keep it neutral – Sellers love their collections of figurines or bowling trophies, but buyers need to envision the home filled with the things they love. A savvy seller will keep it simple and consider repainting colorful interior walls in neutral tones.
  5. Clean, clean, clean – Kitchens and bathrooms should be scrubbed and counters kept clear. Wet towels, hair dryers, and dishes in the sink are a no-no. If heavy cleaning is a burden to the seller, suggest an affordable cleaning crew to clean the carpets and make the windows sparkle – even steam-clean a dingy exterior.
  6. Fix what’s broken – A leaky faucet or a wobbly railing may not seem like a big deal, but it makes buyers wonder what else is wrong with the home.
  7. Remember the back yard – Be sure it’s tidy and that the swimming pool, if there is one, is sparkling clean.
  8. On showing days – A pot of potpourri simmering on the stove and a dining table set with attractive tableware are inviting and cost-effective touches.

Barbara Pronin is an award-winning writer based in Orange County, Calif. A former news editor with more than 30 years of experience in journalism and corporate communications, she has specialized in real estate topics for over a decade.

Century 21 AA Realty Long Island

Reprinted with permission from RISMedia. ©2018. All rights reserved.

7 Cost-Effective Ways to Reduce Heating Bills

(Family Features)–Many homeowners think big when trying to find effective solutions to skyrocketing heating bills, like replacing the furnace or installing new windows, but there are plenty of smaller projects that can make a difference when it comes to your energy savings this winter.

Consider these tips to keep your home cozy without your energy bill putting a damper on the season:

Take advantage of solar heat.
Installing solar panels is one sure way to capture the sun’s energy, but there are other ways to harness that heat. Unobscured windows and skylights can let the rays in, and with them comes some heat. Leave curtains open during the day and trim foliage outdoors to provide a clear path for sunlight. Just be sure windows are well-sealed so you’re not offsetting any heat gain with a cool draft.

Install or upgrade your heat pump.
Heat pumps work differently than traditional cooling and heating systems. They recycle heat found in the air and ground, moving thermal energy between indoors and outdoors instead of generating it from scratch by burning fossil fuels. When properly installed, an air-source heat pump can deliver one-and-one-half to three times more heat energy to a home than the electrical energy it consumes, according to the U.S. Department of Energy.

They can save electricity costs by 30-40 percent.
In particularly cold climates, technology is making it possible to reap energy-saving benefits. An option such as the Hyper-Heating Inverter(r) from Mitsubishi Electric Cooling & Heating offers a significant advancement in heat pumps. This technology uses an intelligent compressor system to deliver heat even when outdoor temperatures are as low as -13 F, and a quick-start feature provides warm air instantly.

Move furniture away from vents.
Free air flow is an important component of efficient heating and obstructed vents interrupt that process. Not only can furniture be damaged from the continual air flow of a vent, it can block the circulation patterns that were intended when your home’s ductwork was installed. For optimum efficiency, avoid placing furniture on top of vents, and if it’s impossible to avoid, close those vents so the airflow is directed elsewhere.

Reverse your ceiling fans.
Your ceiling fans can play an important role in air circulation. Leaving them off will obviously make rooms warmer, but some circulation can be a good thing. Most fans offer a switch that lets you reverse the fan direction, which pushes air upward instead of down. This makes for less of a cooling effect while still moving air for better temperature distribution.

Install a programmable thermostat.
A degree or two may not feel like much of a difference, but it’s a change you’ll definitely see on your energy bill. Just a small adjustment in your standard thermostat setting can result in reductions of 5 or even 10 percent of your overall bill. Another potential big-impact strategy: adjust temperatures when you’re away from home. A programmable thermostat will let you turn temps down when no one is there to benefit from the warmth, then bring them back up shortly before you’re scheduled to return home. When you’re away unexpectedly or need to adjust your typical schedule, an option like the kumo cloud(r) mobile app offered by Mitsubishi Electric Cooling & Heating allows control of your home’s cooling and heating system from your smartphone or other connected device.

Adjust your hot water heater.
Not only can keeping the air comfortable add up, so can heating water for basic household functions. In fact, the U.S. Department of Energy estimates that water heating is the second largest energy expense in most homes. However, you may have your heater set higher than necessary. For every 10-degree drop, you can expect to reduce energy costs by 3-5 percent.

Insulate the attic.
A poorly sealed or insulated attic can be among a home’s biggest energy drains. Warm air naturally rises, but rather than recirculating throughout the home, it may be wasted if it’s just escaping out of the attic. Sealing cracks and adding insulation can help reduce this loss. Don’t overlook the access door, which can allow warm air to escape if it fits poorly or isn’t well-sealed.

Source: Mitsubishi

Century 21 AA Realty Long Island

Reprinted with permission from RISMedia. ©2018. All rights reserved.

How-To Take Control of Your Money in 2018

(Family Features)–Counting calories isn’t the only way you can resolve to bring about positive change in your life during the new year. If you’re like many Americans, it may be a good time to start counting your way toward better financial health.

The past year brought financial setbacks to nearly two-thirds of United States households, according to a survey by the National Endowment for Financial Education (NEFE). In fact, more than a quarter of U.S. adults say the current quality of their financial lives are worse than they hoped. Topping the list of setbacks in 2017 were transportation issues (23 percent), housing repairs or maintenance (20 percent), and the inability to keep up with debt and falling behind on bill payments (16 percent).

In an effort to reverse that trend, more than two-thirds of U.S. adults will make financial New Year’s resolutions for 2018, according to the survey. Among those that plan to step up their financial game, top goals include setting and following a budget (40 percent), making a plan to get out of debt (39 percent), establishing savings (32 percent) and boosting retirement savings (31 percent).

“We continue to see a lot of anxiety about money,” says Ted Beck, president and CEO of NEFE. “Three-quarters of Americans said something causes them financial stress, and it’s most often not saving enough and debt that are to blame.”

Reduce money stress and take control of your finances with these tips for financial success from the experts at NEFE:

1. Get debt under control. Take a hard look at what you owe. If there’s a clear warning sign of too much debt, take action. Set a goal to reduce your debt load next year by 5-10 percent. That might mean reducing impulse shopping. When you face temptation, delay the purchase and give yourself time to consider whether it’s a wise move that fits within your budget.

2. Save now and do so often. Preparing for unexpected events like medical emergencies can help reduce the financial impact of a life-changing event. Emergency savings can offset unexpected costs and help you get back on solid footing. A good rule of thumb is to have 6-9 months of income set aside. If that feels out of reach, start with a smaller goal, even as little as $500. When it comes to saving, it’s also a smart idea to think long term. Review your long-term savings and ensure they are on target for your retirement plans.

3. Shop for better services. You may be surprised by how much you can save when you periodically shop for the most competitive rates on your recurring bills. Make a game out of shopping providers to find the best value on your insurance policies, cell phone plan, internet and utilities. Ask your providers about current rates and any promotions available to long-time, loyal customers. Then look at alternative providers to determine where you can trim some spending. Be sure to understand your current offering thoroughly so that you are comparing apples to apples.

4. Understand what’s behind your financial decisions. If you ever wonder why you feel good about spending money on vacations but avoid saving for retirement, the answer may lie in your unique values and how they influence your financial decision-making. Consider taking the LifeValues Quiz at smartaboutmoney.org, where you can also find help with setting goals and getting your finances in order.

Source: Family Features, National Endowment for Financial Education (NEFE).

Century 21 AA Realty Long Island

Reprinted with permission from RISMedia. ©2018. All rights reserved.

Best Financial Investments for Your Home

By Craig Middleton

On popular home improvement shows, people repair or add new features to their homes to add substantial market value in the process. Whether you are looking to increase the value of your home or just make improvements for your own enjoyment, some of the best financial investments you can make for your home include:

Major Problem Fixes
The first high-return investment you should make in your home is to correct any major problems. If your home has serious issues, such as a broken air conditioner or a pipe leak, fixing those issues should be priority No. 1. Repairing or replacing the roof and siding can be a great investment, as potential buyers will generally factor in both the time and cost of having to fix it themselves. Problems like these are always easier to fix when they’re small than later, after having put them off.

Exterior Improvements
Replacing garage doors is one of the best improvements for the exterior. If your garage door looks new, your house will look new as well. Painting the outside of your home is another good investment in the exterior. If you don’t want to take the time and money to fully repaint your home, pressure-washing can be a quick way to make the outside of your home look much more presentable. Replacing windows is another way to make the outside of your home look better, as well as improve the home’s energy efficiency.

Entryway Improvements
Like the garage door, the front door is important in making a good first impression on a potential buyer. Replacing a wooden front door with a steel door can also make your home safer, and increasing the safety of your home can be another great selling point.

Update The Interior
Fixes and additions to the inside of your home can be a great financial investment. A fresh coat of paint to the interior can add value by making the home look newer, cleaner and brighter.

Improving your home’s bathroom(s), particularly visible elements such as vanities, lighting, countertops, toilets and tubs, can create a high return. You may obtain a better return on investment by making improvements to the main features, instead of completely gutting the bathroom.

Kitchen remodels can be another way to significantly improve the value of your home, by improving functional items such as cabinets, drawers, pantry doors and appliances. Appliances such as refrigerators don’t have to be completely new, but they should keep up with current trends.

Adding high-efficiency appliances to a home can modernize it and also save you money on electricity. Some states and cities have tax programs that could reduce your taxes if you buy and use high-efficiency appliances that require less electricity.

Overall, you should research the investment potential of your home before making any purchases. If you are trying to increase the resale value of your home, you need to make sure your fixes or additions will increase the value of the home not only for you, but also to potential buyers.

Adapted from an article on RISMedia’s Housecall blog.

This material is meant for general illustration and/or informational purposes only.  Although the information has been gathered from sources believed to be reliable, no representation is made as to its accuracy.  This material is not intended to be construed as legal, tax or investment advice.  You are encouraged to consult your legal, tax or investment professional for specific advice. 

Century 21 AA Realty Long Island

Reprinted with permission from RISMedia. ©2018. All rights reserved.

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