May is “National Home Improvement Month”. Who knew?!

This is good information to have, or pass along to a friend that is considering remodeling.
Of course, I have relationships with many types of licensed contractors, and I’m happy to send you a specific reference. Also if you would like to get the most bang for your buck, call me. I have plenty of statistics detailing whether a rnovated kitchen or the addition of a home office will give a better ROI.

May is National Home Improvement Month. During times of a softer economy paired with the approach of warmer weather, the National Association of the Remodeling Industry (NARI) wants to remind homeowners to beware of unscrupulous people posing as remodelers.

One common issue exploited homeowners have run into is having to pay both the contractor and the subcontractors. The homeowner’s financial obligations should only be to the contractor. Some dishonorable contractors are collecting large, upfront payments from residents. When the work has been completed, instead of paying the subcontractors, the dishonest business owner instead pays the interest on properties they have already purchased and can only re-sell below cost. This predictably leaves subcontractors without paychecks and forces them to establish mechanics’ or materialmens’ liens on their customers’ properties.

The subcontractors secure payment for their work, but this causes difficulties for homeowners, who then pay the same fee twice for one remodeling project. Since subcontractors have 90 days to file mechanics’ liens, it could take months for homeowners to realize that they have been defrauded. Residents should note that these types of liens will pay the subcontractors before the homeowners if occupants sell their properties.

Protect yourself

To avoid these circumstances and ensure that you only pay the cost of a project once, NARI suggests you take the following steps:

Be sure you hire an experienced remodeler and not a fly-by-nighter waiting for the building industry to pick up again.

Contact state or local licensing agencies to ensure a contractor meets all requirements.

Check with your local NARI chapter, the government Consumer Affairs Office or the Better Business Bureau to ensure the absence of any adverse files on-record for the contractor.

Ask to see a copy of the contractor’s certification of insurance or for the name of his or her insurance agency to verify coverage. Most states require a contractor to carry worker’s compensation, property damage and personal liability insurance.

Verify that the contractor’s insurance coverage meets all the minimum requirements. If homeowners request estimates from several different contractors, they should confirm that they are bidding on the same scope and quality of work. Discuss any variations in bids and beware of any bid that is much lower than the others.

Draw up a contract before a remodeler begins work that includes the contractor’s name, address, and phone and license numbers, if applicable. It should also include details about what the contractor will and will not do.

The agreement should offer a detailed list of materials for the project, with information such as size, color, model, brand name and product. The contract should include approximate start and completion dates.

Study the design plans carefully. Before any work begins, the homeowners should insist both that they approve the plans and that the contractor identifies the design plans in the written contract.

Known as the “Right of Recision,” federal law requires a contractor to provide a homeowner with written notice of the resident’s right to, without penalty, cancel a contract within three business days of signing it, provided it was solicited at some place other than the contractor’s place of business or appropriate trade premises.

Verify that you share an understanding of financial terms with the contractor and that the contract explicitly states them. The total price, payment schedule and any cancellation penalty should be clear.

The contract should include a warranty covering materials and workmanship for a minimum of one year, and identify the warranty as either “full” or “limited.” The contract must identify the name and address of the party that will honor the warranty, namely the contractor, distributor or manufacturer. Homeowners should make sure the document specifies the time period for the warranty.

In the event of a disagreement, a binding arbitration clause is useful. Arbitration may enable the homeowner to resolve disputes without costly litigation.

Before signing a contract, completely review it and confirm that you comprehend it. Consider the scope of the project and verify that the contract includes all requested items. If the agreement lacks mention of a specific, discussed item, consider it excluded. Never sign an incomplete contract, and always keep a copy of the final document for review.

Homeowners can depend on NARI

NARI reminds all homeowners that its members must adhere to a strict code of ethics and that there are grievance procedures in place for members who do not. Under the NARI code of ethics, members pledge to always provide quality service and work and follow the high ethical standards of the association, to only promote products and services that are functionally and economically sound, and consistent with objective standards of health and safety, that any advertising or sales promotions will be factually accurate, and any agreements or warranties will be fair and mutually beneficial to all parties concerned.

NARI members also agree to honor all contractual obligations, until and unless all contractual parties involved alter or dissolve them. They also will promptly acknowledge and act on any customer complaints, and refrain from any act intended to restrain trade or suppress competition.

It’s spring! It is the most popular time for homeowners market their homes for sale. Marketing a property for sale requires more than sticking a sign in the yard and a couple blurry images loaded onto the MLS system (contrary to what many “discount” brokerages will tell you, BUT that’s another story for another day).
In the current market, 1. correct home pricing and, 2. home showing condition are extrememly important. I routinely leverage the home staging team to help with showing condition. Home stagers strongly encourage sellers to complete some essential tasks to ensure the most critical first step takes place: driving buyers to a an in-person viewing of the property.

“Many people think all they have to do is make sure the inside of their home is clean, but it really goes far beyond that when it comes to making sure your home looks its best so that buyers will take a look,” said Thomas Scott, vice president of Operations for Showhomes Franchise Corporation. “That is why we have released five essential tips that can help local residents stay on the right track when preparing their homes for a sale.”

Five tips for selling a vacant (or a lived in) home:

1. Curb Appeal – the better the curb appeal of your home is, the more attractive it is to prospective buyers. Make certain the walkway to the front door is enticing. You know those cobwebs you walk by every evening on the lower corner of your entry way? Sweep them.

- Trim overgrown bushes, weed beds and add a fresh layer of mulch
- Clean your front door and repaint if needed- don’t forget the hardware!
- Add a fresh, cheery doormat
- Keep grass cut, edged and blown
- Plant some color in the beds to add contrast

2. Cleaning – for most buyers, dirt equals stress and the last thing most buyers want is more stress in their lives.

- Pressure-wash the driveway and sidewalks.
- Clean windows inside and out
- Pressure wash decks and patios

3. Paint – the condition and color of the paint can make a huge difference in how buyers react to your home. Select light neutrals – creamy kakis, pearly grays or soft greens.

4. Replace Worn Carpet – Dirty carpet is unsanitary and nobody will be able to overlook your worn carpet. Replace the top layer with inexpensive neutral colored carpet and you will always recoup the investment. TRUST ME on this one. Offering a carpet rebate does not work. Most buyers can’t get past someone else’s carpet wear.

5. Stage your home – Buyers who look at vacant homes only see floors, walls and ceilings. With nothing else to look at, they focus on flaws. Because of this, vacant houses are very vulnerable to low-ball offers and often sell for 15-20 percent below list price.

My professional staging team is at your disposal- from a 2-hour consultation, to a complete home staging.
If you are even thinking about listing your home for sale, please enlist the services of a professional stager. Even if you choose to list your home “by owner”, especially if you list by owner, you need the advice of a professional.

6 Do’s, 6 Don’ts for New Home Buyers

Its an investor’s market in most of Atlanta.
However, you don’t have to be an investor to get a great deal on a property. Many first time home buyers are finding unparalled inventory and pricing in today’s Atlanta marketplace.

If you are ready to invest in your future, read on for 6 do’s, 6 don’ts for today’s first time home buyer:

DO:

DO utilize free online tools to arm you with as much knowledge as possible. For example, utilize tools offered such as the Home Price Comparison Index available at http://www.coldwellbanker.com which offers buyers a way to compare average housing costs in over 400 U.S. markets.

DO take time to access and closely review your credit score. A sound financial track record and solid credit score can help lock in a loan and lower interest rates. Checking your records with a fine-tooth comb in advance will also ensure that you catch any errors ahead of time, as well as help you better understand how lenders may perceive you.

DO explore mortgage pre-approval. Getting this early green light will help others involved with your purchase that you are serious about home ownership – and well-qualified.

DO line up your “all-star” team of professionals before game day. A team of experienced professionals will be key to making the home buying process simple and seamless. Start by interviewing and selecting a sales associate who you “connect” with. That sales associate should also be able to help you identify suitable lawyers, mortgage lenders, home inspectors and others who play a role in the process.

DO anticipate your future needs and buy for lifestyle. Try to anticipate how long you’ll live in your next home and plan for major lifestyle changes when possible. What may make a perfect starter home for a couple might not work as well when children come into the picture. Remember, people move for lifestyle reasons and your first home will likely not be your last.

DO hone in on your housing priorities. Your ideal home may have a porch, a pool and five full baths. But before you start looking, make sure to separate your “must-haves” from your “nice to haves,” so you know where you can compromise to meet your budget.

DON’T:

DON’T fall in love with the first house or neighborhood you see. That grand colonial with the picturesque view may win your heart at first glance, but don’t fall in love too fast. You need to keep an open mind to make sure you find the right fit for all your needs. At the end of your search, it may turn out that the riverfront ranch that’s closer for your commute is a better bet all-around.

DON’T buy beyond what you can afford. It’s easy to fall into that all-you-can-eat attitude when it comes to your first home purchase. You “want it all” when it comes to size, amenities, location, etc. But remember that your eyes may have a larger appetite than your wallet. Make sure that the down payment, closing costs, monthly expenses and taxes are truly within your income and savings range before you sign on the dotted line.

DON’T treat your home the way you treat your stock portfolio. It’s unrealistic and unwise to expect your housing investment to appreciate as quickly as you’d hope for your high-risk bonds. Buying for lifestyle, as opposed to trying to turn a quick profit, will help ensure that you are viewing home purchasing and ownership in the right context.

DON’T try to time the market. By the time most consumers sense a major real estate or financial market shift, the tables have typically already turned. Instead of waiting for a slim and unreliable window of time – and potentially missing out on the perfect home – buyers should focus on their own lifestyles and buy when the time is truly right for them.

DON’T jump into an exotic or confusing mortgage. When it comes to down payments and mortgages, if it sounds too good to be true, it probably is. Be sure to read carefully through every aspect of the proposed agreements to fully understand your end of the bargain. For instance, what seems like an attractive rate now may balloon exponentially a few years down the road. So arm yourself with information and don’t be afraid to ask questions.

DON’T underestimate the value of a trustworthy real estate agent’s on-the-ground expertise. While being a savvy buyer and doing one’s homework will help on the road to homeownership, a local expert with years of negotiating experience is invaluable when it comes to scouting out the perfect home – and closing the deal.

Keller Williams client focus this week- Home Financing Solutions

Financing Solutions with David Reed

Overcoming the misconceptions about the “credit crisis”

You’ve watched the news and read about it in the papers. You know, the “credit crisis” and how buyers need 20 percent down in order to buy a home? And even if you found a buyer with 20 percent down, lenders aren’t making loans anyway. So, why bother, right? Wrong!

We’re right smack in the middle of what just might be the biggest disservice ever perpetrated on potential home buyers.  It seems the press just can’t get enough of all the gloom and doom in the housing industry.  The fact is that mortgage money is as available today as it was a year ago and loans are being made this very moment with little or no money down. And, no, platinum credit isn’t required.  You just need to know where to look.  Who are these lenders? They’re right down the street.

 

Federal Housing Administration (FHA) loans are exploding onto the mortgage scene; recent estimates are that one out of five mortgages are FHA loans. FHA loans never went away, their reemergence is a result of the collapse of the sub-prime market. FHA doesn’t technically have a minimum credit score, although, in practice, lenders won’t approve an FHA loan with a credit score below 500. But that’s a far cry from the notion that an 800 score is the only thing lenders care about.

The best part?  FHA only requires 3 percent down. 3 percent. And that 3 percent can come in the form of a gift or grant.  FHA borrowers only need to have $500 in a transaction.  All the while, FHA mortgage rates are as good or better than their conventional counterparts.

Low or no down payment, extremely competitive rates and easier qualifying.  No wonder FHA is moving up the charts!

Please contact me if you would like more information about FHA loans or help getting into your first home.
Chris@Chris-Reeder.com or (404) 323-3533.