It’s often said that kitchens and baths sell houses.  That saying didn’t become common because it wasn’t true.  Your Glen Ridge NJ realtor will want to talk to about updating your kitchen if you are selling.  The market is competitive and strategic updates may make a quick sale.

Most sellers think they either have to spend a fortune gutting their kitchen or just leave it to the next owner.  Neither option is really wise these days!  You’ll be glad to hear that there are options for updating that won’t bust your budget or leave your buyers wishing for more.

Paint
It sounds simple but a fresh coat of stain blocking primer followed by a new layer of paint will work wonders in a kitchen.  Degrease any stains and splatters before painting so they won’t show through.

Backsplash
If your backsplash still features barnyard animals, it’s time to update it.  There are many cost-effective options like glass and ceramic tiles or stainless steel.  Stay true to the feel of the kitchen to avoid a style clash.

Sink
A new sink will make the whole kitchen feel cleaner.  Rust stained, chipped or dented sinks bring down the look of the kitchen.  Make a great impression with a new sink.

Hardware
One of the least expensive ways to update a kitchen is with new hardware.  A $50 to $100 worth of stylish drawer pulls and cabinet knobs will give a far greater return on the investment.

Island
If your kitchen has room, consider adding an island.  You don’t have to call a custom cabinet maker.  There are plenty of ready-made pieces of furniture at home improvement and décor stores.  You can make it part of the sale or take it with you.  Just have your Montclair NJ realtor make it clear to the buyer if the island is not included.

Counter Cladding
Few sellers will be surprised to hear that buyers want to see natural stone counters.  Replacing your counters may not be in the budget but cladding them could be.  An installer makes what amounts to a shell that goes over your counters.  You get the look of custom-cut stone at a fraction of the price.

Cabinet Refacing
You can also reface the cabinets at a reasonable rate.  Solid doors can be sanded down and stained while lower quality doors can be painted.  Done well, either option will make the kitchen look new again.

Floors
Pay attention to the floors.  You might need to bleach your tile’s grout or lay new peel-and-stick laminate squares over a damaged “no wax” floor.  Fill in deep gouges in wood floors with wood filler.

These updates won’t cause your budget too much stress but they might make you home the fastest seller on the block.

When you are ready to list your home, one of the first things your Montclair NJ realtor will talk to you about is updating.  Even if your home is fairly new, there is a lot of competition in the market.  Your home needs to stand out for all the right reasons.  A few updates in key areas can make your home the first to sell.

Kitchens and baths are the rooms where buyers have the biggest expectations.  Regardless of price, buyers want to be impressed, especially by the master bath.  Your Glen Ridge NJ realtor can tell you more about what buyers looking at your neighborhood expect to see in your home’s price range.

One of the first places you can give the look of a major update is in the bathroom.  You don’t need a serious renovation to give the impression of an upgraded bathroom.  There are some relatively painless ways to make a bath feel new.

Medicine Cabinets
Replacing an old medicine cabinet will give a bath a fresh feeling.  Hang a large mirror instead, but with an eye for a future buyer.  Be sure your new mirror is large enough to accommodate a wide range of heights and be attractive to many different tastes.

Faucets
New faucets are a great way to update a bath on a budget.  Choose a style that blends well with the style and age of the home.  In other words, don’t go ultra-modern if you have a Victorian.  Follow the directions for installing the new faucets carefully to avoid messy leaks under the sink.

Ceramics
The ceramic fixtures, meaning sinks and toilets, can become stained by age, rust and scale build-up.  If your ceramics are looking tired or outright nasty, replace them.  This isn’t the time to get creative, though.  Buyers will likely prefer a simple white sink over a basin painted with fancy fish.

Counters
It may be cheaper than you think to replace a bathroom counter.  Most baths don’t have huge stretches of counters so you won’t need as much in materials as you would in a kitchen.

Refitting
Tubs and showers can be refitted at comparatively low cost.  A new fiberglass layer is applied over your old tub or shower.  You have a pristine new surface in a day or two.

Talk to your realtor about what updates your bathroom needs.  A few updates might just make your sale happen faster.

Think you Can’t Buy?  Think Again.

Watching the news can be depressing.  Many of the headlines are just plain bad news.  The mortgage “crisis”, the bursting of the “bubble” and the “collapse” of the real estate market have all been exposed, examined and rehashed a few too many times.  This bad press has kept some potential buyers from contacting their Glen Ridge NJ realtor.

Contrary to what you may be thinking, this isn’t such a bad time to buy.  There are a number of good reasons to consider buying sooner rather than later.

• Tax credits for buyers, first time and repeats.
• Low interest rates.
• First time buyer programs.
• Excellent inventory on the market.
• Most reasonable prices in years.

These are just a few reasons to think about calling your Montclair NJ realtor.  Tax credits will be ending in June so timing is crucial if you want to take advantage of buying while it is most beneficial. 

While the real estate market isn’t all gloom and doom, there are a few things you will need to have in order before you start house hunting. 

• A fairly healthy credit score.
• Preapproval for a mortgage.
• A down payment and/or closing costs.

It is true that lenders are a little more carful these days.  If you credit score is poor, you’ll need to do some work if you want to qualify for a lower rate.  You may still be able to get loan with a lower score but your interest rate won’t be as low.

Research lenders and choose one you trust.  Get a preapproval for your loan.  This is different from prequalification, although many people use the words interchangeably.  Preapproval is a firmer commitment from your lender to loan you a certain amount at a certain rate.  Your lender will do everything for a full approval except the title search and appraisal.  Prequalification is more of a rough estimate.  It’s based on information you provide and subject to change depending on a credit check and other verifying factors.  Preapproval gives you an edge when negotiating; it shows you are serious about buying and capable of doing so.

You may also want to save up a down payment and closing costs.  Again, this shows sellers that you are a serious buyer.  Sellers want to work with buyers who have everything in place and won’t cause delays. 

Think again if you thought you weren’t able to become a homeowner.  This might just be the right time for you to buy.

RESPA Rules

Starting in January this year, you and your Glen Ridge NJ realtor have some new tools to protect you from unfair lending practices.  The new Real Estate Settlement Procedures Act (RESPA) regulations went into effect as of January 1, 2010.  This consumer protection act is meant to make you a better loan shopper.

The origins of RESPA stretch back to the early 1970s, but it has become an important measure of protection in the wake of recent problems in the industry.  The act requires a lender to disclose certain bits of information to the borrower at specific times in the process.  It also prohibits practices that increase the settlement costs.  RESPA covers mortgages and loans for the purchase of most residential properties, refinancing loans and equity lines of credit, among others.  The act is enforced by one of the offices of the department of Housing and Urban Development (HUD).  HUD’s website and your Montclair NJ realtor can show you what your lender should be showing you based on this legislation, but here are a few of the details.

At the Application
Disclosure begins in the application process.  One of the most important things the lender should give you is a Good Faith Estimate (GFE) of the cost you will have to pay at settlement.  A Mortgage Servicing Disclosure Statement should also be given to you.  This tells you if the lender intends to transfer the loan to another lender and gives you information about complaint resolution.

Before Settlement
Some lender will ask you to use one of their affiliates during the transaction, like an appraiser or an attorney.  A Controlled Business Arrangement (CBA) disclosure will explain that you are not required to use that affiliate to represent your interests.  This document lets you know you are free to find your own provider for the services.

At Settlement
Both borrower and lender should be given a HUD-1 Settlement statement showing all the actual settlement costs of the transaction.  You should also get an Initial Escrow Statement showing all the costs, fees, taxes, premiums and other charges that will be paid from your escrow account.

After Settlement
Your lender should provide you with an Annual Escrow Statement to summarize all escrow payments made in the preceding year.  This report will tell you of any shortages, overage or actions taken in regards to your escrow account.  If your lender sells or transfers your loan to another lender, you should be notified with a Services Transfer Statement.

This is only a short summary of all that RESPA covers.  Take some time to educate yourself on the details of this important consumer protection act.  It will make you a smarter borrower.

Avoiding Equity Scams

Many news stories over the last couple of years have been dedicated to unscrupulous lending practices.  As a result, consumers are much more aware of the scams in the market and many of the unsavory characters have been weeded out of the industry.  However, there are still some “bad apples”.  Your Monclair NJ realtor can point you to some legitimate lenders, but responsibility for your safety lies with you.

Flipping

Outright scams are easier to spot.  The more subtle tricks of a dodgy lender are harder to see.  One such trick is called loan flipping.  It starts with a legitimate “cash-out” refinancing.  Many homeowners are using cash-out refi’s to make home improvements rather than selling their current home and buying another.  This is a great option for a lot of owners to access the equity they have already built in their homes and use it to build more.

The trick comes in after the refi is finished.  The lender contacts the homeowner after a few payments have been made and offers another refinancing to finance a dream vacation, a car or another luxury.  The offer of more cash is tempting but the lender tacks on high fees, often disguising them within the loan.  Ultimately, this can leave the homeowner with no equity and an even greater debt load.

Duck this practice by asking for a printed copy of all fees and costs.  Take the time to compare the lenders rates with other companies.  Don’t be taken in by offers that expire quickly.

Stripping

Equity stripping is another common ruse.  The lender encourages the borrower to be less than 100% truthful on their applications.  The lender makes it sound as if it’s OK to exaggerate or stretch the truth to qualify for a larger loan.  He may lead you to believe that you are entitled to better than what the banks will offer and a little of embellishment will get you what you deserve.

Any falsification of information on your loan application is loan fraud and illegal, no matter who encourages you to do it.  The point of this game is for the lender to con you into a mortgage you cannot afford.  When you fall behind on the payments he will be able to take your home, sell it and pocket the proceeds.

You can avoid this dangerous scam by being totally honest, even if it you qualify for less.  Know your budget and stick to it.  Don’t let house envy get you into trouble.

Talk to your Glen Ridge NJ realtor about scams and unprincipled practices.  She can help you wade through the lending process without getting trapped.  Ask her about the disclosure rules that went into effect last January to help make spotting these “bad apples” a little easier.

Open House Mistakes

If you’ve ever hosted an open house as a seller, you know it’s harder than it sounds.  It seems like it would be an easy job.  Just let people traipse through your home, see how great it is and wait for an offer.  Any Montclair NJ realtor knows there a lot more to it than that.

Great Expectations
An open house can be a great tool to generate leads and interest in your home.  It is not necessarily going to “sell” the house.  Some sellers do get lucky and find a buyer with an offer in hand at an open house, but more often than not it takes a bit more work afterwards.  An open house is a great way to attract buyers’ agents and build some good buzz for your property.  Keep your expectations reasonable.  Remember, this is just one tool of many in your realtor’s arsenal.

Not Ready for the Close Up
Do you think that the worst thing that can happen at an open house is for no one to show up?  It’s not.  The worst thing that can happen is that tons of people show up and house is a shambles.  This will wreck your home’s “reputation” among both agents and buyers.  Make sure your house is spotless from top to bottom, staged to perfection and ready to be scrutinized in every nook and cranny.  This means you have to pack up the clutter and about half the furniture, organize every item and scrub the entire house.  Don’t forget to remove medications and valuables, too.  Open houses sometimes attract more than just potential buyers so be careful with your possessions.

Attracting the Wrong Crowd
Sometimes sellers want to pull out all the stops to attract people to an open house.  They will hold raffles or give out door prizes, put flyers in every corner shop and coffee house and invite all the neighbors.  While a creative approach is great, this kind of marketing blitz may not be the best idea.  A raffle or door prize might get people in the door, but are they really potential buyers or just there for the freebies?  Think carefully about how many people you really want wandering about in your home.  Let your Glen Ridge NJ realtor advise you on how to best market to the right audience.

Insufficient Marketing
A mistake in the opposite direction would be not marketing enough.  If you just pop a sign in the dirt at the corner, you won’t generate interest past your nosy neighbors.  Work closely with your realtor to ensure that the right people are invited to your open house.

An open house can be a great way to market your property.  Ask your realtor if this approach is best for you.

Spring Cleaning for a Fast Sale

When the weather begins to warm up, the house hunters come out of the woodwork.  It seems like nearly everyone puts in a call to their Montclair NJ realtor in the springtime.  If you’re thinking about putting your home on the market, take advantage of this season’s renewed interest in real estate.  But before you list your home, make sure you’ve don’t your spring cleaning.

Clean Green
When you start you spring cleaning projects, remember to think green.  Use environmentally friendly cleaners; they’re easier on the Earth and on your body.  Don’t just toss out old clothes and furnishings.  Send them where they can live another life, like to a shelter or local charity. 

Watch the Details
Your Glen Ridge NJ realtor will tell you it’s the details that sell a house — unless those details are grubby and covered with fingerprints!  Open up all the window treatments and get a good look at your window sills, trim moldings and baseboards.  A simple mixture of mild dishwashing liquid and water will take off most of the dust and grime that accumulates on these surfaces.  Clean the surfaces that surround your door knobs and cabinet pulls.  Give any spots that still look discolored or dirty a fresh coat of paint.

Don’t Forget the Garage
Buyers will be looking at every corner of your home.  This includes under the sink, inside the cabinet and definitely inside the garage.  You may not think the garage can be spruced up but there are lots of ways to get it looking its best.  Start with a thorough cleaning out and get rid of the junk.  This could be a great time for a garage sale.  Organize what is left and put up some shelving so everything has a place.  Use a pressure washer to clean oil spots from the floor and rid it of dirt.  If you have stubborn stains, get some paint designed for concrete or an epoxy garage floor finish.  Either one will give you a new looking floor.

An Inside and Outside Job
Don’t forget that spring cleaning is both an inside and an outside job.  Your patio, desk and walkways could probably use some attention from that pressure washer, too.  If you have vinyl siding, check for mold and mildew growth and spray that away as well.  Clean out the gutters and downspouts and get the lawn looking healthy with some patch filler and fertilizer.

When you’re done you’ll not only be ready for a competitive housing market, you’ll also have a fresh, clean home to enjoy until you get that perfect offer.

Info for the New Real Estate Investor

Investing in real estate looks a lot different today than it did just a few years ago.  Real estate is still a solid investment, even since the bubble burst, but most investors go about it in ways they didn’t consider even just five years ago.  “Investing” used to be synonymous with “flipping.”  These days when someone asks his Glen Ridge NJ realtor about buying an investment property, he’s usually thinking about renting it.

Renting is a long-term way to make money from real estate.  It’s not as fast a profit as flipping a home could be, but there is more security in renting.  The market is strengthening but it’s no longer at such a peak that a flipped is a guaranteed sale.  Plus, there are benefits to renting that newly minted landlords may not even be aware of yet.

Tax Deductions
There are a lot of ways to maximize the money you make from renting a home and one of them is to investigate every tax deduction available.  Some are obvious and some may not have occurred to you.  Check with your tax professional to make sure you are getting the full benefits from your rental property.  Here is a sampling of deductions to get the discussion started.

Interest
This one is pretty well-known.  Every homeowner can deduct the interest from their mortgage, whether it’s on a rental property or primary residence.  This is quite often a large deduction.  You can also deduct the interest on loans used to improve the property

Travel
Every time you have drive to fix that faucet, you can deduct your travel expenses.  You can use the standard mileage rate deduction (around 55 cents per mile in 2009) or the actual cost of gas, repairs and so forth.  If your property requires you to travel long distances, you may be able to deduct the cost of hotels, airfare, meals and other related expenses. 

Contractors
The wages you pay to contractors and laborers to make repairs on your properties may also be deductable as a business expense.  You can do this whether the worker is your own employee or an independent contractor.

Depreciation
This is definitely an area to discuss with your accountant, but the depreciation of your rental property is deductable.  It’s a complicated formula that allows you to deduct a certain percentage each year for the first 27 years you own the rental.  This deduction can really improve your bottom line.

If you are thinking about investing in a rental property, look into the different types of deduction you may be able to claim before you call your Montclair NJ realtor.  What you learn may just give you the push you need to get back into the real estate market.

I’m very excited to report that a great new charity is born!  It’s called Baby Steps and it’s a clothing drive for children ages 0-4 who are among the 900 families living below the poverty line in the Montclair area.  The new or like-new clothes will be collected and given out to these families twice a year, in May and October.  The drive will begin this May, 2010.

How Baby Steps Was Born
This charity is both a grass roots and interagency joint effort among the Montclair United Way, The Salvation Army Montclair Citadel and local parents. It began with the parents, who often have so many clothes to dispose of as their babies and toddlers grow and who wanted to see the items go to the best use possible.  Many of them give the clothes to family members, friends or drop them in a bin – unsure of exactly where they end up.  Getting clothing directly into the hands of those children who need them most is a very exciting and simple way to help. 

Baby Steps will put the clothes directly into the hands of the local families who need them most.  These families already come to the United Way under the WIC Program (Women, Infants, Children) for food stamps, counseling and other services.  And The Salvation Army provides a host of services through the Emergency Assistance Fund for Families.

How to Get Involved
If you have some new or like-new clothing to donate for children ages 0-4, you can drop them off on Wednesday, May 12th at The United Way Building on South Fullerton Ave, next to The Montclair Public Library.   You will receive a receipt for tax purposes.  If you would like to volunteer some time to help sort through and give out the clothes, just contact me and we’ll sign you up!  If you would like to make a donation of money instead of clothing, your checks can be made payable to The Emergency Assistance Fund for Families and then The United Way and Salvation Army will put it to good use.  You may, if you wish, earmark the money for a specific purpose.

Baby Steps Clothing Drive Information

Clothing Drop Off Day: Wednesday, May 12, 2010   9:30-4:30pm

Location:   The United Way Building
                      South Fullerton Ave (next to library)
                      Montclair, N.J. 

Volunteer times:  Thursday, Friday and Saturday, May 13, 14 and 15th

A lot of buyers worry that the right house will never come.  But the right house always appears eventually.  And, buyers should be able to take as much time as they need find it.  But, one of the obstacles to finding it without spending two years looking and fretting is to begin eliminating as many communities as possible – as early on as possible – so that they can target the town that is perfect.  In a region like Essex County, New Jersey where there are so many towns to choose from in very close proximity, it’s easy to conduct a search in 5 or 6 of them at once.  However, one of the interesting characteristics about our area is that the towns are each very unique and different from one another.  They vary in their transit systems, their housing inventory, tax ratios, politics, goods and services, lot sizes, school systems, household income levels, parks and recreation programs, and so much more.

Steps 1 and 2
After getting pre-approved for a mortgage – which is the first thing a buyer should do – eliminating towns is the next step.  You might need a few weeks to target the top choice but the best way to get there is by ‘process of elimination’.  Finding the house is not that hard.  In fact, it’s actually the easy part, believe it or not.  Even if the community you choose is a little pricey for your wallet, you can always buy a smaller home and expand, or a fixer-upper and improve down the road. But you’ll never be able to change the address – or create services, beauty or amenities that just don’t exist in the municipality.  It’s better to buy a home that may need a little work in a town that you’re over the moon about then to buy a better house in a town that is just okay in your mind.  Once you’re in, you’re in. Like a marriage, you want to be 100% sure that you know what you’re getting into. 

How to Choose the Right Town
How do you judge a town?  Certainly, don’t judge it by looking at a bunch of attractive affordable listings on the internet.  I don’t care how great they are; those are just buildings.  They tell you nothing about the fabric of the community.  You can easily be compelled to go see one of those homes, get seduced by its charm and temporarily forget that the location makes your commute more difficult.  You’ll realize this, of course, the next day when you think it about it but, by then you’ve already wasted a Saturday or Sunday afternoon with your family by having gone to see this home.  I know that it didn’t cost you anything but your time.  But these hours of searching in the wrong towns can add up and wear you down – making your search a chore rather than the fun and exciting experience it should be.

Things to Consider
Just the way you have priorities for the house itself (location, size or condition), prioritize the towns by deciding what your top three criteria are.  Is the school system your highest priority?  Are lower taxes next?  Do you absolutely require proximity to major highways or business centers?  Once you establish these priorities, the decisions almost make themselves.  Some of the criteria to consider are:

• School rankings and/or teaching philosophy (Rankings don’t always tell the whole story.  Some highly ranked school systems have difficulty managing children with slight learning disabilities and you will pay extra for services.)
• Property taxes  (In many cases, you get what you pay for so when you see a town with ultra-low taxes, find out why they are so low.  There is always a reason.)
• Sports and Recreation  (How many parks are there?  What sports programs do they offer?  Is there a Community Center?  A YMCA?)
• Do they have their own Police and Fire Dept?  (Some small communities share with neighboring towns and they may be volunteer departments – as opposed to being paid by the municipality.)
• Where is the top of the market?  (How much do the most expensive homes in the town sell for?  Are you buying one of the best homes in town?  Or are most of the homes around you more expensive?)
• Who lives there?  (What’s the profile of the residents?  Are they mostly professionals?  Tradesmen?  Artists?  How does the town skew politically?  What’s the vibe?)
• Medical Services (Where is the nearest hospital, medical center or walk-in clinic?  How highly is it ranked?)
• Town Center  (Walk through it; talk to the shopkeepers to help get a vibe on the community)