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Home Improvements!

“I spent $50,000  on home improvements but my home’s appraised value only increased by $35,000?”

If you’ve been in the mortgage business, you’ve had to address or handle a question like the one above.  As a capitalist society in the United States, we all want to see a return on investment!  As a homeowner, when you do a home improvement you will increase the value of your home, however, it’s not typically dollar for dollar.  So, spending $50k on finishing your basement, doesn’t increase your home’s value by $50k.  Unless you are completing an above grade addition to your home, historical data supports that you’ll receive approximately 70% return on investment.   Some items, such as landscaping and fences, return far less than 70%.

The key to home improvements is simple, do it for your enjoyment and not for a resale value.  Remember, it’s called “HOME” improvements and not “HOUSE” improvements.  It’s your HOME.  The improvements you’re doing are for you/your family.

So, when you’re thinking about investing in your home, consider it to be investing in your level of enjoyment from your home and not just in the value.  If you do that, you’ll always feel good about it!

What it means to have a “friend in the industry”

“I have a friend in the industry.”

It’s safe to say that in the world of mortgage, we have all heard this one before.  When someone broadcasts this to you, the real question is, “What does having a friend in the industry mean?”  It could mean, “A realtor lives down the street from me.”  It could mean, “My son’s basketball coach is an appraiser.”  Or it could even mean, “I know someone at church who works for the bank.”

We all have “friends” in the industry – not just the mortgage industry either, but in many industries.  And working in the industry doesn’t make them all experts.  Having a friend in the industry and having a trusted advisor to help you determine your mortgage options are two completely different things.  Just because you have that “friend” in the industry, it doesn’t mean that you’ve shared your financial situation with them.  Most people tend to keep their private business…well, private.  However, by having a relationship with someone who is a trusted advisor, and who puts your interests above all else, that’s really having a friend in the industry.

If you’re looking for a “friend in the industry”, let us know because we are here to help!

Todd’s Mortgage Minute: “How are rates?” Hmmm…

I’ve been in lending for almost 20 years and a question I receive from friends, family, and acquaintances alike is often the same, “how are the rates?”  Well, this all depends on many factors, but it is mostly dependent on what YOUR situation is and what YOU’RE  trying to accomplish.

You’d have to have lived under a rock the last couple of years not to know how low rates have been — and not just low, but HISTORICALLY LOW.  But, over the last three months, it’s been well publicized that “rates are going up”…again, from a historical low.  Just because rates are rising doesn’t mean they’re high, it just means they’re higher in some capacity than what they were yesterday. Not to mention many factors go into determining the rates, as well:  credit scores, loan to value, type of occupancy, length of loan term, etc.

So consider this: if you’re trying to purchase a new home and you’ve found the house of your dreams AND it’s in your budget, then the rates should be good for you!  Or, if you’re looking to refinance your current mortgage to save money each month by securing a lower payment and rate, then the rates should be good for you, too!

Remember, none of us in the industry can tell or predict what the rates will be tomorrow or anytime in the future, we can only share what they are today, and if it meets your needs and is better than what you have, I would say the rates are good!