Tis the Season to Get Your Shopping on..... How Will This Affect Your Credit Score?

Merry!  Merry! And Happy!  Happy!  Tis the season to get your shopping on!!

As the shoppers rush home with their presents and their credit card balances continue to increase... their credit score could pay the price.

Something to keep in mind this "season o' shopping" .... your credit score is determined on many factors and one of these factors is how high you keep the balances on your credit cards.  In order to keep your credit scores in tip top shape, make sure to keep the balances on your credit cards below 30%. 

This means if your credit limit is $1000 then you will want to keep your balance under $300.  Keep in mind if you spend over $300 and are above the 30% point, you will want to make a payment to your credit card company to take your balance below the 30% point before they report to the credit bureaus in order to keep from possibly decreasing your credit score.  You can call your credit card companies and ask when they report to the credit bureaus each month so you can be aware of when you need to make your payments.  This date may or may not correspond with date your payment is actually due.

Another way to make sure you stay under the 30% threshold is to inquire with your credit card company about a higher credit card limit.  Make sure you are being responsible and honest with yourself when making these type of decisions!!  Do not get yourself into a bad situation.  The best policy is to “know thyself” and your spending habits.  If you spend whatever you have available….. maybe increasing your limit isn’t a great idea for you.  Begin this year to really discipline yourself to stay below that 30% threshold each month and watch your credit score start climbing.

Also note.... your score will take a big hit (dropping considerably) if you exceed your high credit limit for your credit card and it is reported to the credit bureaus.... not only do you usually have to pay an over limit fee and you may lose a low interest rate.... you may see a considerable drop in your credit score..... no bueno!  Best practices is to know exactly where your balances on your credit cards are and keep them under the 30% tolerance.

Knowing the factors that determine your credit score is the first step in raising and keeping your credit score in tip top shape.  Self discipline is the action that makes that happen!   

Merry!  Merry!  and  Happy!  Happy!!  Cheers to a wonderful holiday season and may your new knowledge of credit scoring keep YOUR credit score happy all year long.

…..PS….. beware of the temptation to open tons of new credit cards because of the 20% you could save on your purchase….. it may cost you in the long run if it drops your credit score…..another factor in determining your credit score is “opening new accounts”…. Tune in next week for more info on this useful tip! 

5 Hot Tips to Sell Your House for Top Dollar

Want to sell before the end of the year?  801.828.8015

This year has been a HOT year for real estate and there is still time to sell your house by the end of the year if that’s what you’d like to do.  You can also take a little time to give your house a little face lift and really get the top dollar when selling your home.  Going into the winter months is a great time of year to do that.  There are many things that will help sell your house for top dollar and we have learned the tips and tricks to do just that.  Here are five hot tips we have found that will sell your house for the highest price.

First of all if you want to sell your house before the end of the year then you will want to get your house listed ASAP.  If you live in Utah and you’d like to know what you could sell your house for right now send a text to 801-828-8015 with the word “comps” and your home address.  We can look at the houses that are similar to yours in the area and give you a good idea of what you could sell your home for right now.  If you are just curious what “projects” you could do that will give you the biggest **Bang** for your $$Buck$$ then read on, we have some other HOT tips for you below.  Listing your house with a real estate agent puts your house on the MLS (Multiple Listing Service) so you have a much wider audience and listing with an experienced SELLING agent that also flips homes, gives you insider information on the best way to sell your house fast and get top dollar for it.  That’s what we do….. so text us today if you want to sell by the end of the year.

If you’d like to take a little time over these next wintry months to work on a few things around the house but just don’t know where to start or what is going to be the best return on value we have some GREAT ideas for you.  One of the best things you want to do to get the highest possible market value for your house is give it a quick face lift.  Paint is an inexpensive way to give your house a fresh feel.  Make sure you are using the newest trends in color themes, not just your style. We can let you in on the latest trends in the market and how to make it really work for your house.  Also, not all paint is created equal and we’re happy to give you some great tips whether you are doing it yourself or hiring a professional, give us a call first and we’d be happy to give you some short cuts that make a BIG difference.

Next, you want to DECLUTTER. You might love all those pictures on the walls and all the many knickknacks and decorations that fill your house but a potential buyer wants to be able to see the space and create what it could look like with their “stuff” in it.  To allow the buyer to get a feel for this you need to really go through your house and get rid of a lot of the clutter, by keeping it very minimal you will give the feel of an open and fresh space…..this is the key to every new home buyer’s heart.  You might consider getting a short term storage unit if you have a lot of precious “things” you want to save….. OR…… begin to get rid of what is not necessary because it will be a lot easier to move when the day arrives to box everything up!  An added bonus is it is a lot easier to paint when there is less “stuff”…. Win/win!

After you have cleared your clutter and given the inside walls of your house a fresh face lift think about updating some of the hardware. It’s amazing what new light fixtures, door handles and cabinet knobs can do for a place.  Of course, you want to be replacing the hardware with the HOT NEW trends so again, reach out to us for the hook up on these updates.  You don’t want to make the mistake of spending money on hardware that is not going to really catch the eye of your new home buyer.  We can help with this and make sure the paint and new fixtures all flow with the existing space and pack a WOWSER punch for new owners.

And the last thing you can do without spending a ton of money is give your home some great curb appeal.  Cut down ratty old trees, trim those overgrown bushes (or pull them out), put down new bark dust (did you know you can get free bark dust from Murray City?), cut the grass and trim the edges.  You’d be surprised just how much these little things can do to bring back LIFE and ZEST to your homes curb appeal.  You might want to pressure wash the garage door and the siding if it needs some sprucing up.  Also, consider putting up some inexpensive shutters or painting your front door.  Again, we can help tell you exactly the compliments we get on our houses from future home buyers and the right tweaks that will let your house stand out far above the competition.

At the end of the day, if you want to sell your house for top dollar you have to start thinking about what the future buyer of your house is looking for in a new home.  We know the trends, we know what sells and we have some pretty sweet hook-ups we can refer you to.  We’d love to list your house for you and walk you through the selling process so you can get top dollar.  It all starts with a call or text to us.  Want to sell by the end of the year???  Text or call and we’ll help you start the process.  We’ll even help you find your new place too.  Buying and selling houses is what we do, we’d love to help you do it too!  Trent Nielsen and Sheri Joi 801.828.8015

5 Pros and Cons to Using a Real Estate Agent to Sell Your Home

To Realtor or Not to Realtor?  That is the question....

As I explored the benefits of using a Real Estate Agent and not using a Real Estate Agent the bottom line was this; there certainly are people who are qualified to sell their own homes but if you take a look at the FAQ on most for sale by owners websites, it suggests that the process is not as simple as you may think.  I’ve been doing mortgage for 20 years and my wisdom suggests it is well worth what you will pay, to have a professional on your side.  With that said…. Here is a list of what you will want to consider when putting your house up for sale.

1-      A good realtor has a sense of the market.  They have insider information on the hot trends and what really “sells”.  They can give you a report of comparable homes for sale and the historic data for your neighborhood.  Of course, you can also do some of this research online ….. you just need to know what you are looking for and you will want to weigh how much of your time will be spent “figuring out” what you are looking for.  A good agent won’t have to figure it out, they will know and be able to guide you through the process.

2-      Negotiating a real estate deal can be tricky business.   A good agent knows which part of the deal to negotiate on…. Whether it is closing costs, purchase price or repairs…. A real estate agent knows where they can best “push” the deal.  Negotiating the purchase of a new home can be emotional and it’s nice to have a third party to help you navigate this process.  Of course there are online tools to help you do this on your own, but having a professional handle the details will ensure that you don’t miss any of the little details of the contract and wind up losing your earnest money because of one of these small details.

3-      Real Estate agents know all the different avenues to find and sell homes.  Depending on the agent you are using, a realtor may have the inside scoop on homes that haven’t even hit the MLS yet.  Through their relationships, realtors may be able to leverage their networks in order to sell your home more aggressively to other agents within their network.    The NATIONAL ASSOCIATION OF REALTORS studies show that 82% of real estate sales are the result of agent relationships through previous clients, friends, family, referrals and personal contacts.  Of course your sphere of influence is a great place for you to begin your own marketing efforts but hiring an agent that “does this for a living” will have more people expecting them to have what they need…. And hopefully that will be YOUR home!

4-      Selling your home can take longer if you don’t have the time to do open houses and showings often…. And those last minute showings in the middle of the day can begin to stress you out.  Real estate agents can be a lifesaver when it comes to getting potential buyers in and out of your house during your work hours.  An agent can also help you stage your home so that prospective buyers can “see” themselves in your house and also point out all the benefits to your home to potential buyers.  Realtors know what is selling in your area and can give you advice of what your home may need to compete with what’s “hot” in your area.

5-      When buying or selling a house, you may need to hire additional professional services… this may include a painter, lawyer, inspector, a title company and more.  Your real estate agent does this for a living and has developed relationships with these professionals.  You may even be able to get better pricing because of the referral relationships some agents have created with these type of professionals.  You can google yourself any of these professionals but we all know that having a referral from a trusted source usually pays off both ways…. Better customer service satisfaction because they want to continue to be referred by these partners. 

What it boils down to is how much time and effort are you willing to put into selling your house.   Yes, there are many sources available for you to do this on your own but my personal opinion is you will save yourself a lot of time, frustration and unknown questions on contracts/paperwork by having a professional on your side.

Sheri Joi, email sherijoi1972 at gmail dot com

The Top 7 Mistakes That May Prevent You From Getting a Mortgage

Yikes!!  Today in my FB news feed I saw that one of my clients bought a new vehicle….(yes, I love that my clients are my friends and my friends are my clients!!!)  I was thrilled they were able to get a shiny new car…BUT.....I gasped a little as I knew this may have an effect on their pre-approval.  I made a few quick calculations and then a phone call …. Phew…. All was well but – "No more buying cars in the midst of our transaction please" -- this little seemingly unrelated event could have prevented my clients from getting a mortgage.   Do you know what could prevent you from getting a mortgage?  Here is a list of the top 7 mistakes that may prevent you from getting a mortgage.

1-      Your credit score.  I’m pretty sure that everyone is aware of the importance of a high credit score but did you know that it can also make a difference in your rate?  This will factor into how much your mortgage payment will be and if your score is a little low, making your rate a little higher… you may have a problem with your debt ratio….. we’ll talk about that next.  Moral of this story…. Understand how your credit score is driven so that your credit actions drive it up!

2-      Your debt ratio. Your debt ratio is the amount of your monthly credit payments… like your car payments, credit card payments and your proposed mortgage payment…. Divided by your monthly income (gross…before taxes and deductions).  Most lenders want your debt ratio to be under 45.  If you buy a car in the middle of the mortgage pre-approval process it could possibly bump your debt ratio up.  This may result in not being able to qualify OR having to lower your purchase price.  Make sure that you talk with your mortgage professional before making any new credit actions while you are in the process of getting a mortgage.  Your mortgage professional will be able to give you the guidance you need so you don’t make a mistake and cost yourself the loan.

3-      No credit.  Gone are the days when it was ok not to have any credit.  If you want to obtain a mortgage you will have to demonstrate you are responsible with credit.  In order for a lender to give you a loan, they must know what your credit habits are.   The lender does this by looking at your credit history.  To be an ideal candidate a lender would like to see that you responsibly pay your installment loans on time as well as your revolving credit.  They also prefer to see that you keep your revolving balances managed…. (this will also help keep your credit score higher...bonus).  Check with your mortgage professional to get the specifics details of credit requirements if you have never had credit or you don’t have any credit reporting currently.  A mortgage professional will be able to guide you in the best way to obtain credit or possible ways of using alternative credit.

4-      Down Payment.  Most lenders require you to put a down payment in order to get a mortgage.  Talking to a mortgage professional before buying a house will give you the details of how much of a down payment will be required, if it can be gifted or how long it needs to be in your bank account before it is an acceptable source for a down payment.  Of course there are some FABULOUS down payment assistance programs available so make sure you talk with a mortgage professional to get pre-approved before you start shopping for the perfect home.  Also, you may need to have some savings (reserves) in the bank, a mortgage professional will be able to let you know if this is a requirement of your specific loan program.

5-      Closing Costs.  When you are saving for a down payment also remember there will be some closing costs involved.  Many times your realtor can negotiate with the seller to pay some of these closing costs.  The amount of closing costs the seller can pay will depend on your loan program so make sure your mortgage professional is involved and is communicating with your Real Estate Agent right from the beginning.  You don’t want to get to the end of the deal and be short on your funds to close.

6-      Job history.  Believe it or not you do need to have income coming into your household when you obtain a mortgage so just because you are pre-approved does NOT mean you can now quit your job.  It is possible that a lender may ask for a paystub or do a quick verbal verification to your employer right before the funding of your loan to make sure you are employed.  If you are anticipating a job change before you close on your mortgage, make sure you speak to your mortgage professional to make sure there won’t be anything that will hold up your transaction.

7-      Mortgage Pre-approval.  I can’t express enough how important it is to meet with a mortgage professional before beginning the process of buying a home.  I know sometimes it feels scary because you might not be ready to buy right now but by meeting with a mortgage professional you can put together a road map with all the details in place so when you FALL IN LOVE with that PERFECT house.  You can be confident that you are ready to move forward and there won’t be any anxiety in losing your Earnest Money Investment. 

Buying a house is exciting and there is a lot to know.   Find a mortgage professional you feel comfortable with and ask a lot of questions.  This is likely going to be one of the largest purchases you ever make, you owe it to yourself to do the homework and understand what you are about to step into.  I’ve been in the mortgage industry for 20 years and the reason I started was because I truly wanted to understand what the process of getting a mortgage was all about, I love to answer my clients questions and help them feel comfortable about making this fantastic step into home ownership.  Call or email me to set up a mortgage consultation.  –Sheri Joi,  sherijoi1972@gmail at gmail dot com

Mortgage Insurance Vs Mortgage Hazard Insurance….it’s so confusing!

"I can get rid of
Mortgage Insurance?!?
Whhhaaattt???"

We don’t usually talk about refinancing much because the purchase market is so fantastic right now but I wanted to share an experience I recently had with a client that was confused about Mortgage Insurance……………..

My client was referred to me because she had been making her monthly mortgage payments for over 5 years and she was still paying monthly Mortgage Insurance, which was included in that payment.  My referral source wanted her to sit down with me and see what options she might have to remove the monthly Mortgage Insurance.  When I talked to the client about doing this I could tell she was a little hesitant so I asked more questions to make sure she understood what I was talking about.  I discovered that she thought that Mortgage Insurance was the insurance that would cover the costs if a natural disaster happened to her house.  This is a VERY common misunderstanding.  I explained that there is a difference between Mortgage Insurance (Also known as PMI – Private Mortgage Insurance on a conventional loan and MIP – Mortgage Insurance Premium on an FHA loan) and Hazard Insurance.  Let me share how I explained the difference to my client.

Home insurance, also called hazard insurance or homeowner’s insurance, is a type of property insurance that covers a private residence.  It is an insurance policy that combines various personal insurance protections, which can include losses occurring to one's home, its contents, loss of use (additional living expenses), or loss of other personal possessions of the homeowner, as well as liability insurance for accidents that may happen at the home or at the hands of the homeowner within the policy territory.  It is always a good idea to sit down with your insurance agent and find out exactly what your home owners policy covers.  I have a client I’m working with right now that had experienced a fire several months ago and she is in the midst of working with the hazard insurance company to get the contents and structure of the home covered….. I’ll write more about this as it unfolds but this gives you an idea of what the purpose of Hazard Insurance is. 

Now the confusion I find is usually about Mortgage Insurance.  What the heck is that and why do you pay that every month?  What does it do for you?  The answer is, unfortunately, it does nothing for you.  Mortgage Insurance is about the lender.  It protects the mortgage lender against losses that may result from you defaulting on your mortgage.  The benefit to you in having mortgage insurance is that you probably didn’t have to come up with a giant down payment.  You were able to put less money down as a down payment in exchange, you pay a monthly Mortgage Insurance payment.  This extra insurance allows the Mortgage lender to feel more comfortable lending on your home with less equity investment from you.   The important thing to remember is that once your home has at least 20% equity in it, either from you making all your payments on time or market appreciation…. Or both…. You will want to do yourself a favor and get rid of that monthly Mortgage Insurance payment. 

In my client’s case we were able to refinance her into a 15 year fixed loan, cutting 10 years off her mortgage and saving her about $50,000 in interest payments and the great news is that her mortgage payment only went up about $12/month.  “What???  It went up???  You’re supposed to say it went down!!”  Well, think about it…. We were able to get rid of the monthly Mortgage Insurance Payment (usually anywhere from $150-$200 a month) and we shortened the amount of years she will now be paying her mortgage.  This is why there was an increase in the payment.  Would you pay an additional $2160 (that's $12 a month for 15 years) to be able to pay off your mortgage 10 years faster and save yourself $50,000 in interest payments??  Well, my client thought it was a great idea.  She was already used to her payment so it wasn’t a stretch to add an additional $12 to her payment each month and now she’s on track to pay off her loan in 15 years (or sooner if she makes additional payments) as opposed to 25-30 years.

If you are wondering about whether you have mortgage insurance or not….. or if you have enough equity to get rid of that monthly Mortgage Insurance payment then reach out and let’s see what your options are.  – Sheri Joi,  email sherijoi1972 at gmail dot com

5 Tips for Buying a Home

The New Year has just begun and for many that means making goals and resolutions.  If one of your New Year's Resolutions is to buy a house here are a few tips to keep in mind.....

1- Buy a house priced no more than 2.5 times you annual salary.  This is a realistic guideline to ensure that you are not overextending yourself on your mortgage.  Even with this guideline though.... use your inner barometer of what you feel comfortable paying each month with a mortgage.

2- Buy a house in an excellent school district, even if you don't have children.  This will increase the resale value, as many home buyers do have children.

3- Before you buy, hire your own home inspector to detect any potential problems. This report could be a negotiating factor on the price of they home.  You'll want to do this before your due diligence date is expired on your purchase agreement to get maximum negotiating power.  Talk to your realtor (or mine...*wink*) to get more information on this.  A good realtor will be able to refer you to an inspector they trust to work hard for your best interest.

4- Getting pre-approved on a mortgage will give you more negotiating power with the seller. (I promise I'm not just saying that because I want you to come and see me soon.... but I would love that too.)  Getting a pre-approval let's the seller know that you are serious about this transaction and are ready to move ahead quickly.  That is joy to their little selling hearts.

5- Get a realistic view of the neighborhood before you buy.  Drive from your potential home to work and shops at "key" hours to evaluate traffic and make sure you know what it will be like for your commute.

If you or anyone you know is getting ready to buy a home, pass this along to them along with my name and number.  I'd be happy to discuss the first few steps of buying a home....whether this is your first home..... or your 15th investment. -Sheri Joi ,e mail, sherijoi1972 at gmail dot com