2020’s Smartest (and Dumbest) Remodeling Projects: What Pays Off vs. What You’ll Regret

Jodi Jacobson/iStock

Has the new year prompted you to take a fresh look at some of the eyesores in your home? Maybe you’re itching to replace those drafty windows, or eager to install a spiffy new deck so you can finally accommodate all your friends when the weather warms up.

But jumping into a home remodeling project isn’t for the faint of heart, especially since you’ll want to make sure you can recoup a good part of your investment when it comes time to sell. To help you pinpoint the right projects, Remodeling magazine has just released its annual Cost vs. Value report highlighting how much various projects cost, plus their return on investment.

To come up with their 33rd edition of this report, researchers took a look at the top 22 home renovation projects in 101 metropolitan areas across the country. The report lists the cost of each renovation, the value of the project at resale (based on estimates by real estate professionals), the percentage of the project’s cost you can expect to recoup, and whether that value has increased or dropped from last year.

o which remodeling project really pays off the most? According to their data, the installation of manufactured stone veneer takes the top spot among remodeling projects, with a return on investment of 95.6%—nearly the full amount you’ll spend.

Inside Remodeling’s Cost vs. Value report: Why faux stone rules

Why is adding faux stone so hot, you might ask? As it turns out, making a good impression on possible buyers is the reason, which is also key to a potential sale.

“Manufactured veneer has been one of the top ROI projects over the past few years, in part because it reflects a wider trend of curb appeal investments tending to add more overall value than interior renovations,” explains Vincent Salandro, an assistant editor at both Remodeling and ProSales magazines.

Photo by Coronado Stone Products

In fact, 9 of the top 10 high-return projects in the report are ones that pertain to a home’s exterior. Replacing the garage door came in second place (and was first last year), where it now earns an ROI of 94.5%. Other top ROI projects include window replacement, outdoor decks, and new siding, which was broken out into two categories for the first time this year (fiber-cement and vinyl).

This leaves minor kitchen remodeling (such as installing new cabinet fronts, hardware, countertops, and flooring, and replacing old cooktops and fridges with more energy-efficient models) as the lone interior project in the top 10. Clearly, when it comes to ROI on home remodeling, it’s what’s on the outside that counts!

Why remodeling costs are up—and values down

This year’s findings also indicate an overall uptick in costs for all of these projects—as well as a downturn in their perceived value.

By comparison, last year’s report revealed that homeowners would make back 66.1% of the money they shelled out for remodeling projects, but in 2020 the overall number dropped to 63.7% of cost recouped.

This significant difference over the past year may be related to consumer confidence. Editor Clay DeKorne, who managed the cost/value report and wrote about its key trends, notes that Americans might be feeling leery about purchasing property due to the less-than-steady world markets and possible future trade wars that could unfold at any moment.

DeKorne’s trends analysis also notes that bigger, more personalized home projects like bathroom and kitchen makeovers don’t exactly appeal to the greater public. The bottom line: One person’s tile obsession is another’s worst nightmare—and a potential home buyer may end up wanting to rip out all of your carefully curated work.

Photo by Del Casa Homes

Wondering which project sits in last place on this year’s list? Alas, it’s the same as in 2019: an upscale master suite addition, which costs a shocking $282,062, while the resale value is just about half—$145,486, or a cost recoup of 51.6%.

Granted, if you’re pining for a new spa tub and heated floors and you’ve found your forever home, you might consider this money well-spent. But the rest of us are probably better off considering better shingles for the roof, or splurging on a new front door.

Ready to take a deeper dive into the data? Check out which home renovations will give you the best (and worst) return on your investment in the chart below.

A breakdown of the ROI for top home remodeling projectsRemodeling magazine
Article by Jennifer Kelly Geddes

5 Dire Mistakes People Make Moving Their Pets to a New Place

Lightspruch/iStock

Moving involves so many tasks: planning, packing, hiring movers, enlisting emotional and physical help, and lots more. Moving with pets can add even more to your to-do list.

When we moved a couple of years ago, I never really considered how our two Lab mixes, Coco and Cookie, would handle it. That was a big mistake. I looked up a few tips online and tried my best to put them into practice. But, for the first few days in the new house, my dogs were stressed and anxious, got into fights with each other and barked all the time—all unusual behavior.

After a couple of weeks, they started to adjust, and their anxiety subsided. But it got me wondering what I could have done to make this move less traumatic for them.

My two dogsErica Sweeney

To help keep your animals calm and safe when moving to a new place, we’ve highlighted some top mistakes pet owners make in the process. Here are some moves that experts say pet owners should avoid if they want a smooth transition.

1. Keeping pets around on moving day

Moving day will probably be chaotic, so boarding pets, or having them stay elsewhere for the day or overnight, is a good idea, says Nicole Ellis, a pet expert and certified professional dog trainer with the online pet sitter and dog walker network Rover.

Cats can be confined to a specific room in the old or new place to keep them away from the activity, says Mikel Delgado, a cat behavior expert at Rover. She suggests placing a sign on the closed door that reads, “Cat Inside: Please Do Not Open Door,” to prevent escapes.

We boarded our dogs for a few days during our move, which gave us time to start unpacking and get their things set up before bringing them home. Knowing they were safe and out of the way made the move less stressful.

2. Washing pets’ things before the move

Familiar smells ease pets’ anxiety, Ellis and Delgado say. It may seem like a good idea to wash your pets’ belongings or buy them new things before a move for a fresh start, but don’t.

Beds, blankets, toys, litter boxes, and food and water bowls bring the scent of the old home into the new one, and this substantially reduces pets’ stress and helps them adjust, they say.

Delgado also suggests not packing pets’ items until the last minute, so they’ll feel at home while you’re preparing to move.

3. Not keeping an eye on them in their new environment

Once you’ve moved, Ellis recommends watching your pets closely as they explore their new place—and checking (inside and outside) for possible escape routes. For instance, even if your new house has a fence, “Dogs can jump higher than we are often aware, so keeping them company outside is always safest,” she says.

She also suggests walking them around the neighborhood one step at a time to ease them into new sights and sounds, which can be overwhelming.

Another tip: Introduce yourself and your pet to neighbors. Give your number to neighbors and explain that your pets are still adjusting to a new place, so if they’re barking too much, neighbors can politely tell you.

4. Changing their setup too much

For cats, “Home turf is everything,” Delgado says. Cats are territorial and feel safest in familiar spaces; moving can cause unusual behavior, such as hiding, fearfulness, and being more vocal. Setting up a “safe room” with your cats’ necessary and favorite things for the first few hours, days, or even weeks helps them adjust.

Once cats get comfortable and are acting like their normal selves, they can be free to explore the rest of the house, Delgado says.

Ellis recommends arranging beds, crates, and toys as close to the old setup as possible. Giving dogs a sense of familiarity with where their stuff is located makes them feel more at home.

This is a tip I found online that seemed to work for us. We placed our dogs’ beds next to the couch in the living room of the new home, similar to where they had been in the old home, and put their water bowl in a similar spot in the kitchen. I also didn’t wash their favorite blankets and bedcovers before we moved, even though it was tempting.

5. Changing your pets’ routine

Routines are important for both dogs and cats, so sticking to regular feeding schedules, walk times, play activities, and other familiar tasks creates stability.

“They really rely on their favorite blankets, beds, and scratching posts to feel safe, and routine is very important to cats,” Delgado says.

Our dogs love their routine. They wake up at 6 a.m. every morning, ready to go outside to use the bathroom and then have breakfast. We kept up this schedule in the new house.

The bottom line is that settling pets into a new place will take time. How much depends on the individual animal, the pet experts say. Ellis urges pet parents to have medical records, microchip numbers, and current photos on hand, in case a pet gets lost.

Pets may show signs of stress and anxiety for several days, but there should be signs of improvement, Delgado says. If not, or if pets aren’t eating, call the vet.

Article by Erica Sweeney

Unexpected Remodeling Expenses That’ll Bust Your Budget

mage: Just Grand

Common remodeling projects can be more complicated than you think. While you’re still in the dreaming stage, factor in realities that could add time and money to your project.

Surprise! That remodeling project you’ve been planning, such as taking down a wall or adding a kitchen island, can have sticker-shock repercussions. Why? Hidden costs, including moving pipes and installing beams, can add up quickly.

Time for a reality check. First, we’ll peek behind some common remodeling tasks to reveal the less obvious challenges that could add hundreds, even thousands of dollars to your remodeling budget.

Then we’ll give you advice on how to protect yourself from unforeseen costs that may pop up during remodeling.

Taking Down Interior Walls

Image: Michelle Bauer

Taking down a wall to combine two areas and improve flow is more involved than just swinging a sledgehammer at some drywall and studs. I learned that during one of my early DIY projects — tearing down a wall to combine two apartments.

Smashing the wall was the easy part. I also had to:

  • Reroute electrical wires.
  • Create a chase to hide HVAC ducts.
  • Patch a small landing strip of parquet flooring where the old wall once lived.
  • Refinish the hardwood flooring throughout the combined areas.

And I was lucky. I might have had to:

  • Cap and reroute plumbing pipes.
  • Replace electrical wires not up to code.
  • Exterminate termites and other pests living behind the walls.
  • Patch, prime, and paint the ceiling where the wall used to be.

The trickiest part of taking down a load-bearing wall in a single-family house is temporarily shoring up the area, then putting in new beams and supports.

“There’s a lot of jacking and shoring and building temporary walls,” says Jeff Patrizi, a Houston builder and remodeler, who estimates that work adds $500 to $4,000 to the job, depending on how the newly open area must be re-engineered.

Adding a New Kitchen Island

It seems no gourmet kitchen transformation is complete without an island. But installing an island is more complicated than just topping a couple of base cabinets with a slab of granite.

Image: NW Homeworks

Electric outlets: Building codes typically require that islands have electrical outlets every 6 feet. Adding a circuit or two is no big deal if your kitchen is above a basement or crawl space and near your electrical panel. It’s a bigger deal if the kitchen sits on a slab, and your electrician has to drill through concrete to run electrical wires a long way from panel to island. Figure an additional $500 to $1,000 to your project.

Task lighting: Your new workspace will need overhead task lighting. Added cost depends on how far your kitchen is from your electrical panel, and what type of fixture you install.

If your kitchen is under an attic space, running new wires is relatively easy. But if your electrician has to open up the ceiling to access joists, you’re looking at drywall repair and a whole new paint job for your ceiling, adding another $300 to $1,000.

Plumbing: Island prep sinks require new plumbing. Your plumber will probably tap into the pipes of your primary kitchen sink. But, if the island is on a concrete slab, plumbing costs could rise up to $2,500.

Clearing corners: When you order the island countertop, make sure your fabricator measures to ensure the finished countertop can be carried into the house easily — fitting around corners and up stairways if necessary. If dimensions don’t work, the fabricator will have to cut the slab, creating an unsightly seam in your gorgeous stone.

Installing Dream Appliances

Creating a dream kitchen might include installing industrial-sized refrigerators and ranges. But bigger isn’t always better.

Industrial refrigerators: Sure, that commercial-style fridge holds more and looks great. But the thing can weigh 800 pounds — the average fridge weighs 250-300 pounds — and be a bear to carry into your home and maneuver into position. That monster fridge may force you to shore up floor joists (consult a structural engineer) or remove door jambs to squeeze it into your home.

Six-burner ranges: I had to have six burners and a grill when we built our home 16 years ago, so I sacrificed a 24-inch cabinet to fit the 48-inch range into my kitchen design. As it turned out, I never use six burners at once (and I’ve used the grill only twice), and I’m always short of storage space.

Commercial range hoods: A pro-range requires a pro-hood, which has a stronger motor (600-1,400 CFMs) than a typical range hood (200-400 CFMs), and may require an upgraded venting system. Such systems require large vent ducts (8- to 10-inch diameter vs. the normal 4-inch) that must take a straighter path to the outside of your home, adding $1,000-plus to your kitchen renovation, depending on the length of the run.

Asbestos Up-Charges

Homes built prior to 1975 may contain deadly asbestos fibers sleeping in vinyl and linoleum flooring, old drywall compound, popcorn ceilings, and old siding. All these materials should be tested by an asbestos inspector before disturbing them ($400-$800).

If asbestos is found, you’ll need to hire a remediation company to remove it, which could cost $1,000-$3,000 at minimum; $20,000 to $30,000 if asbestos is everywhere.

Adding a Basement Bedroom

Image: Brenne Builders

It isn’t a bedroom just because you call it one. A legitimate, up-to-code bedroom has an egress window or door big enough for you to escape and for firefighters to enter in an emergency – a minimum of almost 6 square feet. If the room is below grade, the window must be paired with an exterior window well.

Tim Snyder, a Connecticut-based remodeling contractor, had to explain basement realities to his client when, on the first day of construction, the client changed his mind and decided to turn a new basement playroom into a more flexible space that also could serve as a bedroom.

“The tiny basement windows weren’t even close to being egress compliant,” Snyder says. “So we had to break the bad news to the client.”

The news included replacing windows, digging around the foundation, and adding a plastic window well, which jacked the price up $2,000.

How to Protect Yourself Against Unforeseen Costs

An important step to take when moving from the remodeling fantasy phase to reality is signing a fixed-cost agreement with your contractor. The contract should include a detailed scope of work.

Contracts should contain change-order policy that states that all changes or unforeseen costs should be put in writing and signed by you and your contractor before additional work begins.

Article by LISA KAPLAN GORDON

 

Turkey Meatballs Recipe

SOUTHERN LIVING

Everyone enjoys a plate of cheesy meatballs, and tender ground turkey lightens up this flavorful, family-favorite one-pan supper. This is a tasty recipe to have in your recipe box for an easy weeknight dinner. You may want to consider doubling the recipe and freezing half for an extra quick fix. To freeze, shape the meatball mixture into balls, place on a parchment paper-lined baking sheet, and place in freezer until meatballs are frozen. Transfer them to freezer safe storage bags until ready to use. Maximize flavor by using a combination of both white and dark ground turkey. For the most tender meatballs- no matter what meat you are using- the Southern Living Test Kitchen pros recommend using the “claw method.” Shape your hand into a claw, keeping your fingers relatively rigid, so that you are just gently shaping the meat inside of your claw- rather than squeezing it. Squeezing the meatballs make them tough and chewy. You want to shape them, not squeeze them. This recipe works well served with either rice or hot pasta.

Antonis Achilleos; Prop Styling: Kay E. Clarke; Food Styling: Emily Nabors Hall

Ingredients

  • 1/2 cup dry breadcrumbs
  • 3 tablespoons whole milk
  • 1 large egg, lightly beaten
  • 1/2 cup grated yellow onion (from 1 small onion)
  • 3 tablespoons grated Parmesan cheese
  • 1 tablespoon red wine vinegar
  • 1/2 teaspoon kosher salt
  • 1/2 teaspoon black pepper
  • 1 pound ground turkey
  • 1 1/2 tablespoons olive oil
  • 1 (24-oz.) jar lower-sodium marinara sauce
  • 6 ounces fresh baby spinach (6 cups)
  • 3 ounces shredded low-moisture part-skim mozzarella cheese (about 3/4 cup)
  • 2 tablespoons sliced fresh basil

How to Make It

Step 1

Stir together breadcrumbs and milk in a large bowl; soak 5 minutes. Add egg, onion, Parmesan, vinegar, salt, and pepper; stir to combine. Add turkey, stirring gently until just combined. Using your hands, gently shape mixture into 16 (1 1/2-inch) balls.

Step 2

Heat oil in a large nonstick skillet over medium-high. Add meatballs; cook, turning often, until browned on all sides, 8 to 10 minutes. Transfer to a plate.

Step 3

Reduce heat under skillet to medium-low; add marinara and spinach. Increase heat to medium, and bring to a simmer. Simmer until spinach just begins to wilt, 2 to 3 minutes. Return meatballs to sauce in skillet; sprinkle with mozzarella. Cover and cook until meatballs are cooked through, 4 to 6 minutes. Sprinkle with basil; serve immediately.

How to Shop for a Mortgage: A Home Buyer’s Guide to the Right Type of Loan

Julia_Sudnitskaya/iStock

Are you a borrower with a down payment wondering how to shop for a mortgage? We know: Looking for loan products is not exactly what most people would think of as a fun shopping project. Still, your ability to sniff out a great mortgage rate is crucial to your financial well-being as a future homeowner, because the decision you make could stick with you for a very long time, maybe even 30 years. Gulp.

No pressure, right? All we’re trying to say is, it pays to learn how best to compare your mortgage options—which is where this latest installment in our Stress-Free Guide to Getting a Mortgage will come in handy.

How to shop for a mortgage

Like your most trusted shopping buddy, our guide on how to shop for a mortgage lender and a mortgage rate will show you how to hone your bargain-hunting skills and get the most for your money.

Let’s get started mortgage shopping, shall we?

FREE HOME BUYER WORKSHOP, TUESDAY, JANUARY 21st

Step 1. Shop for a mortgage that fits your needs

Ideally, you should start shopping for a mortgage three to six months before you plan to buy a home after you have a down payment. This lengthy lead time is important because you may have to invest time in boosting your credit score. You’ll need a credit score on your credit report of 760 or higher to qualify for the best mortgage rates, says Richard Redmond, mortgage broker at All California Mortgage in Larkspur and author of “Mortgages: The Insider’s Guide.” You’ll need a minimum credit scoring of around 660 on your credit report to qualify for any mortgage at all.

If your score isn’t up to par, mortgage lenders can tell you what you need to do to improve it. (They can also help you save for a larger down payment.) This could involve getting an error removed from your credit report and FICO score, which is a real possibility, given that one in four Americans reported spotting errors on their reports in a 2013 Federal Trade Commission survey.

Step 2. Find low mortgage interest rates

As you probably know, one of a borrower’s main goals while shopping around for a mortgage lender is to secure a low fixed interest rate on a home loan. The mortgage rates different lenders charge, after all, are basically a service fee charged by lenders and are not always apples-to-apples. The lower your mortgage rate, the less money you’ll pay back each monthly payment—and every quarter of a percent counts!

On a 30-year $200,000 mortgage with a 4% fixed rate, for instance, you’ll end up paying back not only that $200,000 loan amount in your monthly payment, but an extra $143,739 in interest over the life of the loan, by the time those 30 years are up. That massive mountain of money on your home loan will end up higher or lower depending on the mortgage interest rate you get. Shorter-term loans for 15 years mean you’ll pay less in interest. You may also be able to refinance your mortgage down the road with your mortgage company.

You can compare fixed rate interest mortgage rates at realtor.com/mortgage/rates, but keep in mind the rates listed here may not necessarily apply to you. What rates you qualify for depend on several factors from your debt-to income ratio to your credit score. Better (meaning higher) credit scores merit better (meaning lower) interest rates.

But there are exceptions. Some first-time buyers may have access to lower interest mortgage rates through the Federal Housing Administration. Mortgages through lenders like the government-backed U.S. Department of Veterans Affairs, which are available to active or retired military personnel, enable borrowers to buy homes with lower interest rates than conventional loans as well. Buyers can also check out Freddie Mac, a government-owned company that funds banks so it can make new mortgage loans to homebuyers. The Federal Housing Authority (FHA) also approves and insures FHA loans with mortgage lenders.

Step 3. Analyze your closing costs

A low mortgage interest rate and a nice down payment may win you bragging rights as a borrower, but this is hardly your only goal. That’s because mortgage quotes come with sizable closing costs, totaling an additional 2% to 7% of the sales price of your home. Some of these extra lender fees are nonnegotiable, such as state transfer taxes, but some fees are negotiable, says Katie Miller, vice president of mortgage lending at Navy Federal Credit Union.

As such, aim to meet with three mortgage lenders—which could be banks, credit unions, mortgage brokers, or any combination thereof—and get what’s called a good-faith estimate, which breaks down the mortgage’s terms, including the interest rate and fees. Your real estate agent can typically recommend different mortgage lenders.

Also find out from each home loan officer or mortgage broker what lender fees are government-regulated and what fees the lender prices—then haggle on the latter, says Sylvia Gutierrez, a mortgage loan officer in South Florida and author of “Mortgage Matters: Demystifying the Loan Approval Maze.”

If you don’t have a 20% down payment, you may have to get mortgage insurance, which will add to your monthly costs.

A caveat: When a mortgage lender processes your loan application, it runs a “hard inquiry” on your credit score, which can dock your score by up to 5 points, says Beverly Harzog, a consumer credit expert and author of “The Debt Escape Plan.” Your score will recover over time, but it may take a few months. As a result, you should limit your loan shopping to three lenders.

Step 4. Be mindful of interest rate fluctuations

Once you commit to a particular mortgage lender, the lender will underwrite and process your loan application. Then you’ll receive a pre-approval letter, which is a commitment to lend you the money for the mortgage you need to buy a home. Although getting pre-approved from a lender is typically good for 90 days, a borrower’s pre-qualified interest rate isn’t guaranteed until you sign a purchase agreement with a seller, so you’ll want to keep an eye on changes in the mortgage market. However, you can opt to lock in your mortgage rate for a period of 30, 45, 60, or even 90 days, depending on your lender.

Soon you’ll be a home owner making monthly mortgage payments.

FREE HOME BUYER WORKSHOP, TUESDAY, JANUARY 21st

Article by Daniel Bortz

5 Things Every First-Time Home Buyer Needs to Know

Here’s what every first-time home buyer needs to know to dive into house hunting with confidence—and with as few curveballs as possible. Whether it’s getting a mortgage, choosing a real estate agent, shopping for a home, or making a down payment, we lay out the must-knows of buying for the first time below.

FREE HOME BUYER WORKSHOP. TUESDAY, JANUARY 21st, 6PM

1. How much home you can afford as a first-time home buyer

Homes cost a bundle, so odds are you’ll need a home loan, aka mortgage, to foot the bill, along with a hefty down payment. Still, the question remains: What price home can you really afford? That depends on your income and other variables, so punch your info into realtor.com®’s home affordability calculator to get a ballpark figure of the type of loan you can manage.

In general, experts recommend that your house payment (which will include your mortgage, maintenance, taxes) should not exceed 28% of your gross monthly income. So, for example, if your monthly (before-tax) income is $6,000, multiply that by 0.28 and you’ll see that you shouldn’t pay more than $1,680 a month on your home mortgage.

But online mortgage calculators give just a ballpark figure. For a more accurate assessment, head to a lender for mortgage pre-approval. This means the bank will assess your credit history, credit score, and other factors, then tell you whether you qualify for a loan, and how much you qualify for. Mortgage pre-approval also puts home sellers at ease, since they know you have the cash for a loan to back up your offer.

You can also decide if you’re going to apply for a loan through the Federal Housing Administration (FHA).

“An FHA loan is a great option for a lot of home buyers, particularly if they’re buying their first home,” says Todd Sheinin, mortgage lender and chief operating officer at New America Financial in Gaithersburg, MD.

An FHA loan will have looser qualification requirements than a traditional mortgage, but there are still certain prerequisites borrowers must meet like getting private mortgage insurance and having a minimum credit score of 500.

2. Pick the right real estate agent

You buy most things yourself—at most, sifting through a few online reviews before hitting the Buy button and making a payment. But a home? It’s not quite so easy. Buying a home requires transfer of a deed, title search, and plenty of other paperwork. Plus there’s the home itself—it may look great to you, but what if there’s a termite problem inside those walls or a nuclear waste plant being built down the block?

There’s also a whole lot of money involved. (You know, a down payment, loan, etc.)

All of which is to say, before you make a massive payment, you will want to have a trusted real estate agent by your side to explain the ins and outs of the process. Make sure to find an agent familiar with the area where you’re planning on purchasing; to her credit, the agent will have a better idea of proper expectations and realistic prices, says Mark Moffatt, an agent with McEnearney Associates in McLean, VA.

“Finding a Realtor is not hard, but finding one that is best suited for you and your purchase is a challenge,” he adds.

You can search on realtor.com/realestateagents to find agents in your area as well as information such as the number of homes sold, client reviews, and more. Make sure to interview at least a couple of agents, because once you commit, you will sign a contract barring you from working with other buyer’s agents—this ensures the agent’s hard work for you pays off.

3. Know there is no such thing as a perfect home

It’s your first home—we understand if you’ve dreamed about the ideal house and don’t want to settle for anything less. We’ve been there! But understand that real estate is about compromise. As a general rule, most buyers prioritize three main things: price, size, and location. But realistically, you can expect to achieve only two of those three things. So you may get a great deal on a huge house, but it might not be in the best neighborhood. Or you may find a nice-size house in a great neighborhood, but your down payment is a bit higher than you were hoping for. Or else you may find a home in the right neighborhood at the right price, but it’s a tiny bit, um, cozy.

Such trade-offs are par for the course. Finding a home is a lot like dating: “Perfect” can be the enemy of “good,” or even “great.” So find something you can live with, grow into, and renovate to your taste.

4. Do your homework

Once you find a home you love and make an offer that’s accepted, you may be eager to move in. But don’t be hasty. Don’t purchase a home or make any payments without doing your due diligence, and add some contingencies to your contract—which basically means you have the right to back out of the deal if something goes horribly wrong.

The most common contract contingency is the home inspection, which allows you to request a resolution for issues (e.g., a weak foundation or leaky roof) found by a professional.

Another important first-time home buyer addition: a financing contingency, which gives you the right to back out if the bank doesn’t approve your loan. If they believe you’ll have trouble making a payment, a mortgage lender will not approve your loan. A pre-approval makes the possibility of having your loan application rejected much less likely, but a pre-approval is also not a guarantee that it’ll go through.

You also might want to consider an appraisal contingency, which lets you bail if the entity who is giving you a loan values the home at less than what you offered. This will mean you will have to come up with money from your own pocket to make up the difference—a tough gamble if cash is already tight.

5. Know your tax credit options

The first-time home buyer tax credit may be no more, but there are a number of tax breaks new homeowners may not be aware of. The biggie: Mortgage interest deduction is a boon for brand-new mortgages, which are typically interest-heavy. If you purchased discount points for your mortgage, essentially pre-paying your interest, these are also deductible. Some states and municipalities may offer mortgage credit certification, which allows first-time home buyers to claim a tax credit for some of the mortgage interest paid. Check with your Realtor and local government to see if this credit applies to you.

FREE HOME BUYER WORKSHOP, TUESDAY, JANUARY 21st, 6pm

Article by Jamie Wiebe

Take Your Pets Shopping: Ikea Unveils Furniture for Dogs and Cats

IKEA

Most cat or dog owners will tell you that Fluffy and Fido aren’t just pets—they’re members of the family (who just tend to shed a bit more than the others). So instead of shooing Fido off the sofa, it might be time to buy him his very own.

To help pet parents out, Ikea unveiled a line of cat and dog furniture this month. The Lurvig (that’s Swedish for “shaggy” or “hairy”) collection ranges from 79-cent dog bowls and cat litter scoopers to a $54.98 cat house on legs, complete with bed. The line also includes necessities like bright orange leashes, pet carriers, and animal brushes.

The line was created by “pet-loving designers with support from trained veterinarians,” reads the Ikea website. The items are available in stores, but not online yet.

“It is quite important for Ikea to have a pet range that fits into our normal furniture range,” Barbara Schäfer, Ikea’s product risk assessment leader, told Fortune. Schäfer spearheaded the veterinary partnership. “As a pet owner, I can say, so far, the normal pet products are quite ugly.”

But just because you buy Fido a snazzy new dog bed doesn’t mean he won’t prefer lounging on yours, says Marc Morrone, host of the now-canceled show “Petkeeping With Marc Morrone” on Martha Stewart Living Omnimedia.

“Do the pets care? They couldn’t care less,” he says of outfitting your home with pet-friendly amenities. “We love our pets, and we feel guilty because we leave them home alone all day. We feel less guilty when we buy them things.”

The exceptions are things like cat trees and scratching posts.

“Cats do like spending time on cat furniture,” he says, noting that “if they’re on the cat tree, they’re not destroying our own furniture with their claws.”

Article by Clare Trapasso

The Link Between Clutter and Depression

It’s been proven. Clutter is a bummer — literally.

Image: Aleksandra Kovac/Stocksy United

Dishes in the sink, toys throughout the house, stuff covering every flat surface; this clutter not only makes our homes look bad, it makes us feel bad, too.

At least that’s what researchers at UCLA’s Center on Everyday Lives and Families (CELF) discovered when they explored in real time the relationship between 32 California families and the objects in their homes. The resulting book, “Life at Home in The Twenty-First Century,” is a rare look at how middle-class Americans use the space in their homes and interact with the things they accumulate over a lifetime.

Our over-worked closets are overflowing with things we rarely touch.

It turns out that clutter has a profound affect on our mood and self-esteem. CELF’s anthropologists, social scientists, and archaeologists found:

  • A link between high cortisol (stress hormone) levels in female home owners and a high density of household objects. The more stuff, the more stress women feel. Men, on the other hand, don’t seem bothered by mess, which accounts for tensions between tidy wives and their clutter bug hubbies.
  • Women associate a tidy home with a happy and successful family. The more dishes that pile up in the sink, the more anxious women feel.
  • Even families that want to reduce clutter often are emotionally paralyzed when it comes to sorting and pitching objects. They either can’t break sentimental attachments to objects or believe their things have hidden monetary value.
  • Although U.S. consumers bear only 3% of the world’s children, we buy 40% of the world’s toys. And these toys live in every room, fighting for display space with kids’ trophies, artwork, and snapshots of their last soccer game.

Although “Life At Home documents the clutter problem, the book offers no solutions. But there are some simple things you can do to de-clutter your home and raise your spirits.

Adopt the Rule of Five

Every time you get up from your desk or walk through a room, put away five things. Or, each hour, devote five minutes to de-cluttering. At the end of the day, you’ve cleaned for an hour.

Be Ruthless About Your Kitchen Sink

Pledge to clear and clean your kitchen sink every day. It takes a couple of seconds more to place a dish in the dishwasher than dump it in the sink. A clean sink will instantly raise your spirits and decrease your anxiety.

Put Photos Away

Return to yesteryear when only photos of ancestors or weddings earned a place. Put snapshots in a family album, which will immediately de-clutter many flat surfaces.

Unburden Your Refrigerator Door

Researchers found a correlation between the number of items stuck to the fridge door and the amount of clutter throughout the house. Toss extra magnets, file restaurant menus, and place calendars in less conspicuous places.

Test Whether You’ll Miss It

Fill a box with items you don’t love or use. Seal the box and place it in a closet. If you haven’t opened the box in a year, donate it (unopened!) to charity.

Article by LISA KAPLAN GORDON

Breakfast Zinger Juice

“This is a delicious, cleansing juice that’s great in the morning. Great way to kick start your day, while getting necessary vitamins.” raina

Breakfast Zinger Juice

Ingredients

  • 2 lemons – peeled, seeded, and quartered
  • 2 carrots, chopped
  • 2 apples, quartered
  • 2 beets, trimmed and chopped

Directions

  1. Press lemons, carrots, apples, and beets through a juicer and into a large glass.

Footnotes

  • Cook’s Note:
  • Try to leave on the peel on the carrots and apples as many of their nutrients are in the skin. They also add fiber to the juice. This juice is also full of beta-carotene which is great for the skin, eyes, cells, and releasing toxins from the body.

 

How to Qualify for a Mortgage: Income, Credit, and Debt Requirements for a Loan

courtneyk/iStock

If you’re wondering how to qualify for a mortgage, you’re not alone. Do you just show up at a bank with a checkbook, and hope for a good mortgage rate and a smile? Hardly! Mortgages aren’t handed out to just anyone—they require a lengthy screening process. If you’re a first-time home buyer, figuring out what you need to get a mortgage can be tricky. But we’re here to help.

How to qualify for a mortgage

Just so you know everything you need to bring to the table when you need to qualify for a mortgage, here’s a guide on how to please the lending gods so they deem you worthy of receiving a huge pile of cash and a great mortgage rate—and what to do if you haven’t covered these bases quite yet so you’ll pass muster soon enough.

Let’s jump in! First off, you need to gather a mess of paperwork from bank statements to pay stubs to tax returns and W-2s. But in addition to paperwork, you need a few other items to get a mortgage loan. Here are the essentials:

A good credit score

When you apply for a mortgage, lenders will check your credit score to assess whether you’re a low- or high-risk borrower. The higher your score, the better you look on paper, and the better your odds of landing a great loan.

While a perfect score is 850, research suggests that only about 0.5% of consumers hit that coveted mark. As a result, scores of 760 and higher are considered to be in the best range from a mortgage lender’s perspective. It means you’d qualify for the best (that is, lowest) interest rates, says Richard Redmond, mortgage broker at All California Mortgage in Larkspur and author of “Mortgages: The Insider’s Guide.”

A good credit score is 700 to 759; a fair score is 650 to 699. If you have multiple blemishes on your credit history (e.g., late credit card payments, unpaid medical bills), your score could fall below 650. If that’s the case, you’ll likely get turned down for a conventional home loan—and will need to mend your credit in order to get approved (unless you qualify for a Federal Housing Administration loan, which requires a 580 minimum credit score).

Your first step, therefore, should be to check your credit report, says Beverly Harzog, consumer credit expert and author of “The Debt Escape Plan.”

You’re entitled to a free copy of your full report at AnnualCreditReport.com. The report does not include your score—for that, you’ll have to pay a small fee—but just perusing your report will give you a ballpark idea of how you’re doing by laying out any problems such as late or missing payments. Some credit card companies, including Discover and Capital One, also offer customers free access to their scores and reports.

You should also check to make sure you’re actually the person responsible for any black marks that appear on your report. It’s more common than you might think—one study by the Federal Trade Commission revealed that 1 in 4 Americans spotted errors on their reports.

If you have poor credit, it may take you several months to raise your credit score into a range where you can qualify for a mortgage. (Here’s advice on how to improve your credit score.)

Substantial—and stable—income

How much income you need to get a mortgage home loan boils down to your debt-to-income ratio; this figure compares your earnings on your tax returns with your outstanding debts. To qualify for a home loan, your job’s income must be high enough to offset your debts, including your possible mortgage payments.

To calculate your DTI ratio, figure out how much you’re paying in debt per month—by tallying up things like car payments, student loans, and credit card bills—and divide that amount by your monthly income on your pay stubs.

Let’s say, for example, that every month you’re paying $250 in debts and pulling in $5,000. Divide $250 by $5,000, and you have a DTI ratio of 0.05, or 5%. That’s well below the recommended rule of 36%, says David Feldberg, broker and owner of Coastal Real Estate Group, in Newport Beach, CA. Keep in mind, though, you don’t own a home yet, which will push up your DTI.

Once you know your income and debt, you can use an online home affordability calculator to see how much you can shell out for a new house, while still remaining below that 36% DTI ratio threshold.

Let’s take the aforementioned example where you make $5,000 a month and pay $250 in debts. Now let’s assume you have around $30,000 for a down payment and can get a 30-year mortgage at a fixed interest rate of 5%. Enter these numbers into a home affordability calculator, and this will put you in the ballpark of affording a home worth $243,100.

In addition, lenders like to see at least two years of consistent income history, says Todd Sheinin, mortgage lender and chief operating officer at New America Financial in Gaithersburg, MD.

This creates a roadblock for many workers who are just starting their careers or are self-employed. If you’re in the latter situation and have variable income, you may need additional assets such as a higher down payment (more on that next) in order to qualify for a mortgage.

A sufficient down payment

Most mortgage lenders like to see that you have enough in the bank to make a 20% down payment—which amounts to $50,000 on a $250,000 home. (And they will be looking at your bank statements.) So if you don’t have that much saved up, it’s time to start pinching some pennies so you can start making those mortgage payments! But there are other options as well.

FHA-backed loans let borrowers make down payments as low as 3.5%. If you’ve served in the military, the Department of Veterans Affairs loans require no down payment at all. Only eligible for a conventional loan? Expect to need at least a 10% down payment, says Sheinin. However, if you put anything less than 20% down on a conventional loan, you’ll need to pay private mortgage insurance—a monthly premium that can range from 0.3% to 1.5% of the total loan amount.

Article by Daniel Bortz

Hindsight Is 2020! 10 Design Trends to Ditch in the Coming Year—and How to Decorate Instead

iStock/Gladiathor/realtor.com

As the hours counted down to a brand-new decade, there’s a good chance you’re reflecting on your choices over the past 10 years. Maybe you’re patting yourself on the back for taking that job across the country. Perhaps you wish you could undo that three-year relationship that sucked the life out of you. Or maybe—just maybe—you’re surveying your home, and you have the sudden urge to get rid of everything in it.

After all, as we head into 2020, now is the perfect time to reevaluate your decor choices. But you don’t have to do it alone. To help, we’ve consulted with the pros about which looks are going by the wayside in 2020—and why. (Disclaimer: If it makes you happy, keep it! Who are we to tell you what to do?)

So if you’re eager to do a bit of purging, read on for what to ditch—and how to decorate instead—to live your best life in 2020.

1. Lone accent wall

Photo by Cantoni

Let us be clear: We’re definitely not kicking bold looks to the curb (more on that in a minute). Instead, we just want more, more, more of them. That means one measly little accent wall won’t cut it anymore.

“It’s time to boldly enter the new decade by fearlessly experimenting with paint. Washing all the walls in a bold color—including millwork and trim—is much more powerful and sophisticated,” says Amanda Amato-Scotto, CEO and principal designer at AMA Designs & Interiors. “If you love a color enough to paint one wall, go the extra mile by painting the entire room. It’s a design risk worth taking!”

Stephanie Purcell, designer and owner of Redesigned Classics, agrees: “With the rise in popularity of wallpaper—and the huge strides it’s made in ease of use, such as peel-and-stick—we’re starting to see whole rooms in vibrant colors or covered in fun wallpaper. Why should one wall have all the fun?”

2. Minimalist designs

Photo by John Maniscalco Architecture

If you can’t tell already, the “less is more” mantra is so 2019. That’s right—2020 will be all about ditching your tiny, sleek furniture and going big—everywhere.

“Gone are the days of spaces with as little as possible. Say hello to visual overload,” says Justin Riordan, interior designer, architect, and founder of home staging company Spade and Archer Design Agency. “The darling of the design world is maximalism—try solids mixed with stripes, mixed with plaids, mixed with polka dots. Take all you’ve learned about midcentury modern clean design, and throw it to the wind.”

We’ve spent so much time with monochromatic palettes and neutral interiors, Amato-Scotto says, that we’re ready to take more risks.

“In true roaring ’20s fashion, we are entering a new decade with visible boldness,” she says.

3. Faux natural materials

Photo by Ceramictec

Faux, no! If you’ve been relying on faking expensive decor, we’ve got bad news: Look-alike materials such as wood-look porcelain plank tile and faux stone will be out in 2020, Amato-Scotto says.

“Of course, there is a time and a place for faux alternatives,” she says, noting that basements and wet areas are prime spots for these products. “However, we live in a time where people desire more authenticity—whether that be on social media, real life, or in the home. Say no to faux, and opt for the real deal, which adds character to your home.”

4. Rose gold and millennial pink

Photo by DS Interior Design

We’ll continue to see mixed metals in the coming year (and beyond). But one such metal might not make it to the 2020 party.

Rose gold “has seemed to reach its expiration date,” Purcell says. “Soft pinks and blushed hues are starting to see a decline, as this millennial trend is no longer considered a fresh idea.”

“[Millennial] pink is starting to feel a little too soft and is starting to remind me of my grandmothers house,” adds Brett Elron, owner and lead designer at BarterDesign.co.

This doesn’t mean that pinks will disappear entirely from favor, they both note, but you can expect to see bolder shades of the rosy hue—think magentas and corals—as we transition into the new year.

5. Farmhouse style

Photo by Crescent Homes

Sorry, Chip and Jo Gaines—the pros are ready to put this one out to pasture. With the meteoric rise of farmhouse design, every retailer big and small has jumped on the bandwagon, producing home goods in the quintessential “Fixer Upper” aesthetic. It was cool for a minute, but designers predict the villagers are getting restless with this ubiquitous look.

“These put-together trends lack unique personality. Mass-produced furniture feels impersonal, and many are opting for more unique, one-of-a-kind pieces, meaning you will likely see more eclectic style mixes, with heirlooms and vintage items making a comeback,” Purcell says. “This is great, because it makes for an easy transition—you can still include some of your favorite farmhouse decor; just try mixing it with some more one-of-a kind finds to create a space that is truly your own.”

6. Cool and light neutrals

Photo by Kahrs

Last year, we predicted the end of an era for gray, which had become design’s go-to neutral. And indeed, warmer tones—light browns, toasty beiges, and creamy whites—have begun to beat out those icier hues. Expect more of that in 2020, but here’s a twist: The truly hot 2020 neutral will be saturated and bold. (Are you sensing a theme here?)

“It’s becoming quite popular to see more vibrant colors take the place of standard neutrals, like navy and emerald green,” Purcell says.

“In 2020, there will be a resurgence of warm earth-tone hues, including champagne, mushroom, ochre, amber, and jade,” Amato-Scotto adds.

7. Fast furniture

Photo by Niche reDesign

The dawn of a new decade is likely to bring a growing awareness of global warming and sustainability. (We’ve already seen a bit of backlash against fast fashion, and the waste it produces.) So you can expect that home furnishings that are not so eco-friendly are decidedly out.

“Let’s be honest, home furnishings that are detrimental to the Earth were never trending,” Amato-Scotto says. “But budget-friendly and short-life-span furniture has been popularized, which in turn end up in our landfills. As consumers are becoming more aware of their carbon footprint and reducing waste, products that are eco-friendly will be trending.”

8. Neon word signs

Photo by Javier Bravo

Ah, the neon sign trend. We’re not talking about the flickering Budweiser homage your husband has in the basement. We’re talking about the catchy neon phrases showcased on Instagram by celebrities such as theKardashians, Justin Bieber, and Bethenny Frankel, just to name a few.

But in 2020, we’re flipping the switch on this trend—Instagram and Pinterest be damned.

“While neon signs look cool when illuminated at night or in a moody photo, during the day their effect lacks luster,” Amato-Scotto says.

Don’t unplug from this look entirely, though. Instead, Amato-Scotto predicts backlit art—with a twist—will gain popularity in 2020. In particular, she favors the work of Alan Strack, who creates backlit cinematic art with movie film.

“His pieces capture your attention and are truly a conversation piece”—and that’s the kind of energy she says we’ll be seeking in 2020.

9. Bedding in a kit

Photo by Roger Oates Design

Every one of us is probably guilty of buying bedding in a bag at some point. And why not? It’s so easy! You get designerlike bedding in a kit, typically a comforter, two shams, and a couple of matching accent pillows. Voila! New bed.

But the problem with these effortless bedding packages is that, well, they scream “no effort,” Amato-Scotto says.

“We are entering an age of authenticity, boldness, and personal expression,” she says. “A bedding set doesn’t allow for creative expression like custom bedding does.”

That doesn’t mean you have to break the bank with hand-sewn linens, but try seeking out individual items, adding layers, and mixing patterns and textures for an effect that’s unique to you.

“We spend nearly half of our life in bed, so why not invest in these items?” Amato-Scotto says.

10. Open floor plans

Photo by Skyring Architects

Say what now? We know, it sounds like blasphemy. For years we haven’t wavered from the idea of being able to see everybody in the kitchen while in the living room or even the dining room. But some of us have begun to tire of all the openness—and we’re craving a little more privacy. That’s especially true for millennials—who will be the single largest demographic of home buyers in 2020 and are eager to put back up some walls.

“The biggest revolt with millennials will be the desire for well-defined spaces for living, working, eating, and cooking,” Riordan says.

Article by Rachel Stults

I’m 27 and Put 17% of My Income Into My 401(k), but That’s Keeping Me From Buying a Home

PaulMaguire/iStock

Hello Catey,

I am a single, 27-year-old male. I am beginning to save for a down payment on a home. I currently contribute about 17% to my 401(k). While that is great, it doesn’t leave me very much room to save for a new home. I am looking for perspective about lowering my 401(k) contributions to help save up for a down payment on a home, versus maintaining 401(k) and lengthening my home-buying timeline.

Thanks,
Zack


Dear Zack,

First of all, congrats on contributing so much to your 401(k) – you’re in an elite minority. A survey from personal finance site GoBankingRates found that about one in three Americans have nothing saved for retirement, with millennials being the most likely group to have a $0 retirement balance.

And even those who do contribute aren’t typically contributing like you do: The average person in their 20s with a 401(k) plan is putting in an average of 7% of their income with their employer matching an average of 4%, Fidelity data shows.

So you’re far ahead of the pack on saving for retirement — and that’s great. Even so, before you touch those retirement contribution amounts, consider other options: “This individual is taking a binary approach to his financial situation, assuming that the 401(k) is the only place to look for cash flow to purchase a home,” says Rich Ramassini, the director of strategy and sales performance for PNC Investments. He notes that you should look at your annual cash flow (income – expenses) and look for other opportunities to save — if you haven’t already.

If you’ve done that, some experts MarketWatch consulted with said that it’s OK for you to lower your 401(k) contributions — to a point, and for a short time — if you want to buy a home. (That advice assumes you don’t have any other high-interest debt and you have an emergency fund socked away -— things you might want to deal with before buying a home, as MarketWatch wrote in this article).

“I generally recommend that employees set aside at least 10% to 15% of their income in order to fund the retirement that they want,” says certified financial planner Amy Ouellette, the director of retirement services at Betterment for Business. “However, your contribution rate doesn’t need to be set in stone, and it’s okay to consider lowering it a bit when saving up for other big milestones. While saving for retirement is incredibly important, so is having the financial freedom to make other worthwhile investments like home ownership.”

So how low can you lower your 401(k) contributions while trying to save for a home? “If buying a home is a few years out, I’d consider reducing your 401(k) savings rate to 8% to 10% of your income, while building up the down payment fund; this way you continue to build for your retirement while meeting a shorter term goal,” says Ouellette.

Certified financial planner Bobbi Rebell cautions that if you decide to lower your contributions to save for a home, you should still make sure you contribute at least enough to get the company match: “That is free money and often a return of 100% depending on the specifics of the plan,” Rebell, who is also the host of the Financial Grownup and co-host of the Money with Friends podcasts, adds. And Ouellette adds that you may want to talk to a financial advisor to calculate exactly how much to decrease contributions by and how much that will leave you for a down payment.

Another possible option: A 401(k) loan, though that also comes with risks. “The best option available, if you plan to stay at your job for a while, is to take a loan from your 401(k) to help cover you for the down payment on the home. Doing this will allow you to continue funding your 401(k) on a pre-tax basis (at the same rate as before), locking in that federal tax deduction up front, while getting you the funds needed to buy the home,” says Dave Cherill, a member of the American Institute of CPAs’ Personal Financial Planning Executive Committee — who adds that you must “keep in mind, if you leave your job with the loan outstanding, you will either need to pay it back, or include it in income that tax year and pay a 10% penalty on top (if under the age of 59-1/2).”

And of course, it’s important that you’re selective about the house you buy, ensuring that you can truly afford the home, that you’re getting a good mortgage rate if you do take out a loan, among other factors. And you should be aware of the fact that investing more in stocks may have upsides over real estate, as MarketWatch explored here.

“Owning a home is a huge financial investment but it is also a lifestyle choice. It provides stability, and a sense of ownership. It is often a commitment to a community,” Rebell points out. “Ownership has many non-financial benefits so it’s not [just] about comparing which will give you the better ‘return.’”

Article by By Catey Hill

I Don’t Have Money for Updates; Should I Offer a Discount When Selling My Home?

asbe/iStock

When your home is on the market, it needs to stand out from the crowd. And certain features like beautifully appointed open kitchens or impeccable hardwood floors are great at drawing eyeballs for listings. But what if you can’t afford to renovate—even if certain things have fallen into a state of serious disrepair?

Some sellers may choose to offer an allowance, or discount, on their home to entice buyers. In this situation, the seller would agree to take the financial hit on repairing anything that the buyer sees as an issue. The allowance would be written into the buyer’s offer, and the buyer would have to check with the lender for details that pertain to this type of clause. (Some lenders may have a problem with it.)

Benefits of offering an allowance

If you cannot afford to make necessary repairs to your property, offering a home improvement allowance is certainly a viable option.

Robert Rahmanian, principal and co-founder of REAL New York, says this might be a good strategy if you’re having trouble selling your house or when a buyer brings up the need for updates.

“The allowance amount very much depends on the kind of updates that need to be conducted,” he says. The allowance may be determined based on the total price of the necessary updates.

According to Martin Eiden, a broker at Compass in New York, the first step is to get written estimates from contractors to do the work, and then offer an allowance for the estimated amount.

“I would present it like this: ‘We were considering updating the kitchen and baths but didn’t want to choose a color the end buyer may not want, so these are the estimates, and the buyer can choose the final colors and finishes,’” he says.

“The allowance amount very much depends on the kind of updates that need to be conducted,” he says. The allowance may be determined based on the total price of the necessary updates.

According to Martin Eiden, a broker at Compass in New York, the first step is to get written estimates from contractors to do the work, and then offer an allowance for the estimated amount.

“I would present it like this: ‘We were considering updating the kitchen and baths but didn’t want to choose a color the end buyer may not want, so these are the estimates, and the buyer can choose the final colors and finishes,’” he says.

But there’s also another option. Although you may not be able to do extensive repairs on your own, it’s possible to put some level of sweat equity into it.

“It costs you nothing to do a thorough cleaning and remove clutter,” Eiden says. In fact, he believes you’ll get the biggest return on investment by painting your home’s interior with a fresh coat of white. Best of all, you can do this yourself. White paint will reflect light and make the rooms appear bigger. Plus, it gives the appearance of a clean palette and can help potential buyers imagine themselves—and their stuff—in there.

Article by Terri Williams

How a side hustle walking dogs became a business that brings in six figures

Twenty/20

Ryan Stewart has always loved dogs. All the same, he says, he fell into his career walking and training dogs “sort of by accident.”

Stewart started his business “Ryan for Dogs” in Long Island City initially as side hustle. It took a year to become profitable, but now, Stewart says, “I’m able to work part time, let’s say 20, maybe 25 hours a week, and make at least six figures a year.”

Stewart, who came to New York City as a teenager with dreams of becoming a professional dancer, was sidelined when he was diagnosed with cancer before starting college. After he underwent chemotherapy, his focus shifted. “Instead of ‘dance, dance, dance,’ I came out of the hospital like this: ‘Oh look, trees. Oh look, people,’” he says.

Needing to earn some money while he pursued acting gigs but “determined not to wait tables,” Stewart decided to try a side hustle first as a dog trainer and then as a walker. He’d always seemed to understand dogs. To develop his skills further, Stewart read books about dog psychology and worked with other trainers.

He had also recognized a growing need for dog walkers, so it made sense to capitalize on the demand. “I really, really put everything into it, and it paid off,” he says.

‘A good walker can easily make six figures’

Today, Stewart walks dogs every day of the week — up to seven at once — and trains them on weekends. He earns up to $25/hour in Manhattan and about $15-$20 an hour in Queens, where his business is located.

“The secret got out that you can make decent money dog walking, and now there’s a lot of people competing,” he says. “A good walker can easily make six figures a year. Easily.”

Ryan for Dogs also employs three dog walkers, which Stewart considers “just the right amount.” As he puts it, “I got in the business because I love dogs and didn’t want to handle people. That’s why I’ve never gone above three people.”

The best parts of the business, says Stewart, are getting to be his own boss — and, of course, working with dogs. “It’s something that I forget a lot, and to be grateful for,” he says. “It’s really quite something to touch dogs every day.”

 

The Hottest Interior Design Trends for 2020—and Beyond

Interior design of the past decade has been shaped by a number of unmistakable trends. Remember Scandinavian minimalism and the all-white kitchen? How about Moroccan-inspired area rugs, Millennial Pink, and the seemingly immortal modern farmhouse aesthetic? Is that fiddleleaf fig plant still thriving? (No judgment if it’s seen better days.) Is that “Live, Laugh, Love” word art sign still hanging in your entryway?

There’s something all of these disparate decor trends have in common: At one point, all felt like the very height of fashion; but now they might seem a bit stale.

Stepping into a new year—and a new decade—gives us the opportunity to look ahead and plan for what’s next for 2020. And when it comes to home design, that means sussing out the decor, colors, and finishes that will be in high demand. Some of the trends from the 2010s will carry over into the next decade, and some will be left in the dust (peace out, open shelving!).

Below, our design experts spill the details on what they expect to be “in” for 2020, and how you can use these looks to refresh your own home.

1. Euro-style cabinetry

Photo by Factor Design Build

We expect to see Euro-style cabinets popping up more and more. These frameless, sleek wonders could relegate open shelving to the dustbin of modern design history.

“This is a very clean, streamlined look,” says Karen Gray-Plaistedof Design Solutions KGP. “The cabinetry will have minimal hardware, and the finishes will be in wood or a solid color.”

“This type of high-end laminate has been widely available in Europe for many years and has now traveled to the U.S. over the past year or two,” says Erin Davis, lead designer at Mosaik Design & Remodeling, in Portland, OR.

But if you think this style works only with modern interior design, think again. Euro-style cabinets will suit a number of aesthetics from boho (seen above) to traditional kitchens, too.

2. Black is back

Photo by CM Natural Designs

Some may say this is the pendulum swinging away from all-white interiors, but many of our experts predict that black furnishings will be bigger than ever in 2020.

Brett Elron, owner and lead interior designer at BarterDesign.co in New York, says we will see black on larger design elements like accent walls, sofas, and cabinets.

“And if you pair up your dark doors with great hardware, you really add some character to your home,” he says.

Gray-Plaisted agrees, saying that black cabinetry is the new alternative to white.

“If black cabinetry is too much for you in a kitchen, consider the lowers to be done in black and the uppers done in wood,” she recommends.

Anne R. Kokoskie of Styled by ARK says that she expects to see the rise of black tubs and bold, dark colors on doors.

3. Quartz in the kitchen

Photo by Savvy Kitchens

This tough mineral will be a rock star in 2020, showing up in the kitchen, bathroom, and even the laundry room. Many designers see it as the be-all, end-all for countertops because of its durability and reasonable price.

“Unlike marble, it’s nonporous and resists stains,” says Davis.

4. Smaller, bolder spaces

Photo by Elizabeth Stamos Design

For a while, open-concept rooms seemed to be taking over all home design. But there are some indications that things might be changing a bit in coming years.

“Now, I’m finding people miss having cozy, individual spaces that they can call their own or allow for different activities without disruption,” says Amy Kartheiser, an interior designer in Chicago.

These smaller rooms are the perfect spaces to go bold with colors and finishes.

“Small bathrooms or powder rooms will also be statement makers through the use of dramatic wallpaper, unusual sinks, and creative lighting,” adds Kokoskie.

5. Burl wood

A burl wood credenzaTarget

Retro in appearance but full of modern visual appeal, burled wood furniture and accessories are bound to be hot in the very near future.

“Burled wood, with its swirly patterns, will be seen on nightstands, side tables, and cocktail tables as a beautiful, natural accent,” says Denise Morrison, founder of the Southern California firm Denise Morrison Interiors.

Shake up your decor scheme with a statement piece like the credenza above ($1,500, Target).

6. Brass

Photo by M House Development

There’s no two ways about it: Brass is here to stay. But this isn’t the chintzy stuff you may have seen in your grandmother’s house.

“Brass is not the brass we have known from the ’90s,” says Gray-Plaisted. “It’s more matte.”

The best way to work brass into your decor is by combining it with other metals.

“Mixing metals is a great way to ensure brass doesn’t feel dated in a few years’ time,” Kartheiser says. Contrary to what you may have been told, combining warm brass tones with its cooler cousins (silver, chrome) is definitely allowed.

7. Double islands in the kitchen

Photo by Meriwether Design Group

If there’s a kitchen renovation in your future—and you love to cook and entertain—consider this building trend: double islands.”Double islands help you separate meal prep from serving,” says Kokoskie. A second, smaller island could also be used as a wet bar during a party or a floral station for arranging vases.

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Want to buy a home in 2020? Here are 4 things to consider that could help

Twenty/20

Millennials are now the largest group of homebuyers in America, according to the 2019 Home Buyers and Sellers Generational Trends Report from the National Association of Realtors (NAR). But even with homebuyers taking advantage of lower interest rates in 2019, and the Federal Reserve’s most recent decision that rates will remain unchanged in the new year, buying a first home can be difficult.

Experts suggest that total housing costs shouldn’t exceed 28% of your budget, which makes homebuying even more of a challenge if you’re trying to save for a down payment while putting money away for retirement and paying down debt.

“That’s superhard, especially for young people in an expensive real-estate market,” Heather Winston, a certified financial planner at retirement plan provider Principal, told Grow earlier this year.

Here are some things to consider that could make homebuying more affordable for you in 2020.

1. Homebuying assistance programs

Many city and state housing authorities have down-payment assistance programs to help first-time homebuyers. For example, Colorado offers first-time homebuyers down payment grants worth up to 3% of the mortgage, and that money doesn’t have to be repaid.

There are also nationwide programs that offer assistance to first-time homebuyers in certain professions. The Teacher Next Door program awards teachers, administrators, and other school staffers up to $10,681 to put toward their down payment.

Depending on where you work, home buying assistance may even be a job perk: Two percent of employers offer down-payment assistance, and 3% offer mortgage assistance, according to a 2018 report from the Society for Human Resource Management.

2. Low down payment mortgage programs

A lot of experts suggest you aim for a 20% down payment on a new home. But given wage stagnation and rising housing costs, that’s not always feasible.

There are a few low down payment mortgage programs for homebuyers who want to make a smaller down payment. A Federal Housing Administration (FHA) loan, which is backed by the federal government, requires that borrowers put just 3.5% down.

There are some downsides to low down payment mortgages, however. Because a mortgage lender is taking a risk by giving you more than 80% of the home’s value, you’ll probably be required to purchase private mortgage insurance (PMI) until you have more than 20% equity in the home. The cost of your PMI may equal 0.5% to 1% of the mortgage each year. Depending on interest rates, you may end up paying more in the long run.

3. Renting out part or all of your space

By renting out spare rooms or portions of their primary residence, some younger owners are earning rental income to help offset the cost of their mortgages and other housing related expense or to put toward other financial goals.

If renting out your primary residence sounds appealing, start by doing your research, says Erika Safran, a certified financial planner and the founder of Safran Wealth Advisors in New York City. That means looking at home values, real estate trends, and “assessing comparable rents” within the area you intend to buy.

“To buy property and have [to pay] $3,000 a month in mortgage and have comparable renters at $1,200 a month, that’s not going to be a great investment for income purposes,” says Safran. “It may offset some of your expenses, but ideally, a really great investment would be one that covers your entire monthly nut, as opposed to offsetting [your expenses].”

Safran also suggests “diversifying your income across different parties” by taking on more than one tenant if you can. That way, you’re lowering your risk should a tenant fail to come through with the rent. As the homeowner, you’ll still be on the hook for the mortgage and all related housing costs.

Familiarize yourself with local laws. Start by looking at the rules for tenants and landlords in your state at HUD.gov to find out how to handle a tenant’s security deposit and what to do if they don’t pay rent, for example. You’ll also need to make sure laws in your area allow for short-term rentals.

Once you find the right tenants, have them sign a lease, suggests Safran. You can find generic lease forms on Rocket Lawyer and the Nolo network, though you may want to meet with a lawyer to hash out the details or to create a personalized lease, depending on your area.

And keep in mind that as a landlord, it’s your job to expect the unexpected.

“You may have a tenant that’s a demanding person, and they always need or want something. It’s sounds so petty, but what it impacts is the building owner’s time, and you’re not going to take off your job to change a light bulb, or you’re going to have to find someone who does,” says Safran.

“Unless this is you’re full-time job, you may have to have someone help manage those rentals.”

4. Budgeting for all homeownership related expenses

As a homeowner, you’ll have to account for a lot of ongoing expenses, starting with annual property taxes and homeowner’s insurance. And if you put down less than that 20%, don’t forget the cost of private mortgage insurance.

Owning a home also requires upkeep. Real estate experts suggest putting aside 1% of the home’s purchase price for repairs and maintenance. And if you’re renting out your space year-round or occasionally on Airbnb, you’ll have need to make sure any broken appliances or a leaky roof gets fixed immediately to keep that income coming in.

For starters, you can use a mortgage and housing cost calculator to factor in all these expenses and help you determine whether or not it still makes sense for you to buy.

And then give your new budget a test drive, some experts suggest: Try living on the amount you would have as a homeowner for an extended period of time in advance to get used to it and to make sure you can do it comfortably.

Article by Alizah Salario

How to Sell Your House Fast: 5 Must-Know Tips to Move Your Property

MarkCoffeyPhoto/iStock

If you need to sell your house fast, you probably don’t have a whole lot of time to research the current real estate market and ponder how it’ll affect your home sale. You just want sales guidance from a real estate agent or other pro that will help you find a buyer as fast as possible.

Well, here’s the good news: It is possible for you, as a seller, to offload your home quickly. The experts say selling comes down to a few key to-do’s that you should take care of before your property hits the market.

If you’re ready to unload your abode, heed the selling advice of the experts below. Of course, we can’t guarantee all homeowners a quick sale, but putting these tips into practice definitely won’t hurt the chances of securing a buyer.

1. Tidy up to make your house stand out (and sell!)

If you’re looking to sell quickly, you’re going to want to start cleaning, especially before those listing photos are taken by your Realtor®.

“Pristine houses from sellers are more attractive to a buyer, which will keep the buyer excited,” says Debi Benoit, principal and broker at Benoit Mizner Simon & Co. Real Estate in Wellesley, MA. “And an excited buyer may pay top dollar to the seller and will usually write an offer quickly.”

Fast selling means getting rid of clutter both inside the house and in the yard and putting some elbow grease into making everything look like a brand-new home (yup, you might need a storage unit for maximum curb appeal).

And selling fast means cleaning from top to bottom in every room of the house. Wipe down cabinets, light fixtures, and drawers, remove any scuffs from the walls, give all kitchen appliances a once-over, clean air vents, shampoo your carpets, and then sweep, vacuum, or mop every inch of the house.

It will take you several days of work to declutter, but the payoff (making a sale!) will be worth it for a potential buyer. Trust us—this is a major part of selling a home quickly.

2. Have your house staged to sell fast

Be the best seller you can be, and go extra mile beyond cleaning. To do this, consider having your house staged, a real estate term that means decorating your place so that it is more attractive to buyers.

“It’s best to present the home in its best light when you’re selling,” explains Nile Lundgren, an agent with Trent & Company in New York City. He once had a real estate listing—unstaged—on the market for five months without ever getting an offer to sell.

“We took it off the market, staged it, reshot photos, and put it back on the market,” he says. “Within two weeks, we got into a bidding war and signed a contract for a sale shortly thereafter.”

Real estate staging typically takes anywhere from a few days to a couple of weeks, depending on the availability of rental furniture, the movers, and the installers.

If you’re facing a major time crunch to sell, Lundgren suggests focusing on staging the beds, sofas, tables, chairs, and art—items that make a house feel like a well-maintained home where people can live and get comfortable.

3. Hire a photographer to take listing photos for a quick sale

It may feel like hiring a professional will be a waste of money. After all, your cellphone has a great camera, right? But that can be a sale killer, says Rosamaria Acuña, a Realtor with Berkshire Hathaway HomeServices California Properties in La Jolla.

“First impressions are everything, and need to be done right,” she says. “A professional photographer has all the tools to capture the right lighting and make everything look brighter and inviting.” The pros also have wide-angle lenses to fit the entire room in the photo.

4. Selling quick means making your home available for showings

Once everything is set up, get ready to spend a lot of time away from your home so buyers and real estate agents can view the property comfortably—without you or your pets wandering around the halls. Selling fast is best done when homeowners aren’t there for an open house.

Remember: If you want to sell your home pronto, you need to be flexible and open with your time, to allow buyers and real estate agents to tour it as often as possible.

5. Attract a buyer with the right price

Staging and marketing your home are important components, but at the end of the day, the amount of money you’re asking buyers to pay could be what seals the deal.

“Nothing will help sell a poorly priced home—and a well-priced home can overcome many other issues,” says Aaron Hendon, a Realtor with Christine & Company in Seattle. “To sell your home fast, your house needs to be priced to compete with the others currently on the market.”

Your real estate agent will help you decide on the right listing price for your home by looking at a variety of factors: your house’s age, any updates, square footage, and the school district.

An agent will pull up comparable homes, or “comps,” that have sold in the area to evaluate the best sale price.

Article by Jeanne Sager

5 Crucial Cold Weather Tips for Preparing Your House for Winter

It’s best to winterize your pipes before the snow sets in. But don’t fret if you forgot — there are still ways to help keep pipes from bursting, like running your faucets and opening cabinet doors. Image: Liz Foreman for HouseLogic

Our winterizing your home checklist will help you keep your house cozy and safe from winter’s frigid assault.

Preparing your house for winter may not be on the top of your to-do list right now. After all, most of us wouldn’t rather spend their down time doing home maintenance tasks when they could be enjoying the fall foliage, going apple picking, or sipping pumpkin-spiced lattes instead of winterizing their house. But, here’s the reality: you can’t procrastinate if you want your home to be fully prepared for the winter elements.

Indeed, cold weather, ice, and snow can do real damage to your home — unless you take the time to prepare it before the winter chill takes hold. Completing this checklist will effectively winterize your home — and make your abode a lot more enjoyable when the thermometer dips.

Insulate Windows

Winter drafts can drive up your energy bill — and detract from the cozy vibe you want inside your home when it’s cold outside — if your windows have any air leaks. But by reducing drafts you can lower your home’s energy costs by up to 20% per year, according to the U.S. Energy Department, while also making your living space more comfortable.

Here are five simple solutions (all under $8!) that will allow you to insulate your windows quickly:

  1. V-seal weather stripping. Add this plastic weather stripping along the sides of the sashes. Windows can open and shut evenly with the V-seal in place. (Pro tip: Weather stripping also works wonders on doors.)
  2. Rope caulk. This soft, sticky stuff can be molded to fill the gap — and the caulk removes easily at the end of the cold season.
  3. Shrink film. Applied with double-sided tape, this clear plastic sheeting shrinks drum-tight when heated with a hair dryer. The film seals off drafts and captures an insulating buffer of air. Use rubbing alcohol to help release the tape in the spring to avoid stripping off any paint.
  4. Nail polish. If carefully applied, clear polish fills the crack almost invisibly. Once hardened, it will stabilize the glass until you can replace it in the spring.
  5. Draft snake. If the bottom of your window is letting in cold air, buy a foam-and-fabric draft snake kit. Cut the 36-inch foam tube provided to length and slip the washable cover over it. Then place the snake on the sill, and shut the window on to seal the deal.

Trim Tree Branches

The last thing you need is a winter storm loosing the wrath of that mighty tree whose branches are angling over your roof. Not to mention, overhanding limbs can cause excess water to seep into cracks in your home’s roof or siding, which is why you want to make sure any tree limbs or branches surrounding your home are at least 3 feet away from the house.

Inspect Your Fireplace

A visual inspection, both inside and outside your home, can ensure that your wood-burning fireplace is in good shape (read: safe) for the burning season.

During an outdoor inspection, make sure:

  • A chimney cap is present and in good condition.
  • There is no bird nest or debris buildup on the cap.
  • There are no tree limbs above or near the chimney.
  • The mortar and bricks on the chimney aren’t crumbling or missing.
  • The chimney rises at least 2 feet above where it exits the roof.
  • The chimney crown — the sloping cement shoulders at the top of the chimney — is beveled, which helps air flow.
  • The flue liner is visible above the chimney crown.
  • The chimney is plumb and not leaning to one side or the other.·
  • The roof flashing is tight against the chimney.

Inside your home, confirm that:

  • The flue damper opens, closes, and seals properly.
  • There are no combustible materials, such as animal nests, or other foreign objects in the flue.
  • The fireplace surround, hearth, and firebox have no cracked bricks or missing mortar.

If you spot any damage, order a professional fireplace and chimney inspection. An inspection costs, on average, between $79 and $500, depending on whether you’re ordering a level-one or level-two inspection.

Gas fireplaces require less maintenance, but you should still:

  • Inspect the glass doors for cracks or latch issues.
  • Check that the gas logs are in the proper position.
  • Turn gas off at the shut-off valve and test the igniter.
  • Ignite the fire and look for clogged burner holes. If present, turn off gas and clear obstructions with a pin or needle.

Check the Roof

You certainly don’t want to find out you have a leaky roof after the first snow hits. A roof inspection can help you spot any potential issues.

Squeamish about heights? Don’t worry — you can do a thorough inspection from the ground using a pair of binoculars.

Work your way around your house, looking for these defects:

  • Cracked caulk or rust spots on flashing.
  • Shingles that are buckling, curling, or blistering.
  • Missing or broken shingles.
  • Cracked and worn rubber boots around vent pipes.
  • Masses of moss and lichen, which could signal the roof is decaying underneath. Black algae stains are just cosmetic.

Some roofing fixes are easy to do yourself, such as repairing shingles or calking flashing, if you’re comfortable working on a roof. If you’re not, you’ll want to consult a specialized roof inspector. Be prepared to pay between $119 and $296 for a standard roof inspection.

Clear Out Gutters and Downspouts

Clogged rain gutters or downspouts can damage your home’s foundation or cause ice dams, which can lead to expensive repairs. So, after the leaves have fallen, clean your gutters to remove leaves, twigs, and gunk. Also, make sure the gutters aren’t sagging and trapping water, tighten gutter hangers and downspout brackets, and replace any worn or damaged materials.

Documents You Need for Mortgage Pre-Approval: A Checklist for Each Type of Loan

Whether you’re self-employed or applying for an FHA or USDA loan, here’s the pre-approval paperwork you need.

If you’re serious about buying a home, getting pre-approved for a mortgage is a critical step. It’s also a tedious one. Lenders seem to want a mountain of documents and have so many requirements.

Yet the payoff is worth it. Most agents recommend mortgage pre-approval because it strengthens your offer. Sellers like to know the buyer already has financing secured.

Plus, you’re going to need that same hefty stack of paperwork for your official mortgage application once you’ve got a contract on a home, so you’re really knocking out two tasks at once.

To help, we’ve created a documents checklist for each type of mortgage pre-approval. Warning: Some lists are longer than others:

Conventional Loan Documents

If you’re employed and get regular paychecks, plus a W-2 every year, and you’re not going through FHA, USDA, or an incentive-buying program, these are the documents you need to apply for mortgage pre-approval:

  • Identification (one of these, which you will need to show in person)
    1. Driver’s license
    2. Passport
    3. Other state- or federal-issued ID
  • Income
    1. Pay stubs for the last 30 days
    2. Last two federal tax returns
    3. Last two W-2s
    4. Proof of any additional income (second jobs, social security, alimony, etc.)
  • Accounts
    1. Last two statements on all bank accounts — be sure to include all pages, even blank ones
    2. Statements for all investment and/or retirement accounts
  • Property
    1. Settlement statement from previous home sale, if applicable
  • Additional documents
    1. Contact information for your landlord(s) for the last two years, if applicable
    2. Divorce decree, separation agreement, and/or property settlement agreement, if applicable
    3. Gift letter if a family member is helping with down payment (lender will have form)
    4. A letter of explanation (LOE) for late payments, collections, judgments, or other derogatory items in your credit history, if applicable

FHA Loan Documents

If you’re applying for mortgage pre-approval with the Federal Housing Administration, you’ll need these documents:

  • Identification (one of these, which you will need to show in person)
    1. Driver’s license
    2. Passport
    3. Other state- or federal-issued ID
  • Income
    1. Pay stubs for the last 30 days, if applicable
    2. Last two federal tax returns
    3. Last two W-2s or 1099s, if applicable
    4. Proof of any additional income (second jobs, social security, alimony, etc.)
  • Accounts
    1. Last two statements on all bank accounts — be sure to include all pages, even blank ones
      1. Statements for all investment and/or retirement accounts
  • Property
    1. Closing disclosure (or HUD-1 if the sale took place before Oct. 3, 2015) for previous purchase
  • Additional documents
    1. Contact information for your landlord(s) for the last two years, if applicable
    2. Divorce decree, separation agreement, and/or property settlement agreement, if applicable
    3. Gift letter if a family member is helping with down payment (lender will have form)
    4. A letter of explanation (LOE) for late payments, collections, judgments, or other derogatory items in your credit history, if applicable

Documents For Buying an Investment Property

If you’re buying a property you plan to rent, these are the documents you should have in hand to apply for pre-approval:

  • Identification (one of these, which you will need to show in person)
    1. Driver’s license
    2. Passport
    3. Other state- or federal-issued ID
  • Income
    1. Pay stubs for the last 30 days, if applicable
    2. Last two federal tax returns
    3. Last two W-2s or 1099s, if applicable
    4. Proof of any additional income (second jobs, social security, alimony, etc.)
  • Accounts
    1. Last two statements on all bank accounts — be sure to include all pages, even blank ones
    2. Statements for all investment and/or retirement accounts
  • Property
    1. Settlement statement on any recent home sales
    2. Recent mortgage statements on all properties you own
    3. Proof of insurance for all properties you own
    4. Current leases for all rental properties you own
  • Additional documents
    1. Contact information for your landlord(s) for the last two years, if applicable
    2. Divorce decree, separation agreement, and/or property settlement agreement, if applicable
    3. Gift letter if a family member is helping with down payment (lender will have form)
    4. A letter of explanation (LOE) for late payments, collections, judgments, or other derogatory items in your credit history, if applicable

Self-Employed or Business-Owner Mortgage Documents

If you’re self-employed or own a business, these are the documents you need for the mortgage pre-approval process:

  • Identification (one of these, which you will need to show in person)
    1. Driver’s license
    2. Passport
    3. Other state- or federal-issued ID
  • Income
    1. Pay stubs for the last 30 days, if applicable
    2. Last two federal tax returns
    3. Last two 1099s
    4. Proof of any additional income (second jobs, social security, alimony, etc.)
  • Accounts
    1. Last two statements on all bank accounts — be sure to include all pages, even blank ones
    2. Statements for all investment and/or retirement accounts
    3. Last two years’ Corporate, S-Corp, LLC, or partnership tax returns
    4. Last two years’ 1099s, if applicable
  • Property
    1. Settlement statement from previous home sale, if applicable
  • Additional documents
    1. Contact information for your landlord(s) for the last two years, if applicable
    2. Divorce decree, separation agreement, and/or property settlement agreement, if applicable
    3. Gift letter if a family member is helping with down payment (lender will have form)
    4. A letter of explanation (LOE) for late payments, collections, judgments, or other derogatory items in your credit history, if applicable
    5. Last two months’ profit-and-loss statements (you can put one together in about five minutes)
    6. Balance sheet, if applicable (rules vary by state)
    7. Current business license

VA Loan Documents

If you’re seeking pre-approval for a Veteran’s Administration home loan, these are the documents you will need:

  • Identification (one of these, which you will need to show in person)
    1. Driver’s license
    2. Passport
    3. Other state- or federal-issued ID
  • Income
    1. Pay stubs for the last 30 days, if applicable
    2. Last two federal tax returns
    3. Last two W-2s or 1099s, if applicable
    4. Proof of any additional income (second jobs, social security, alimony, etc.)
  • Accounts
    1. Last two statements on all bank accounts — be sure to include all pages, even blank ones
    2. Statements for all investment and/or retirement accounts
  • Property
    1. Settlement statement from previous home sale, if applicable
  • Additional documents
    1. Contact information for your landlord(s) for the last two years, if applicable
    2. Divorce decree, separation agreement, and/or property settlement agreement, if applicable
    3. A letter of explanation (LOE) for late payments, collections, judgments, or other derogatory items in your credit history, if applicable
    4. Certificate of eligibility (COE) from the Veteran’s Administration, which may require one or more of these documents, depending on your situation:
      • Form DD-214, certificate of release or discharge
      • Statement of service from the adjutant, personnel office, commander, or higher headquarters if still on active duty
      • Form 26-1817 or form 21-534 for surviving spouses, plus form 1300, report of casualty, or death certificate

USDA Loan Documents

If you’re applying for a U.S. Department of Agriculture Loan, you’ll need these documents to seek pre-approval:

  • Identification (one of these, which you will need to show in person)
    1. Driver’s license
    2. Passport
    3. Other state- or federal-issued ID
  • Income
    1. Pay stubs for the last 30 days, if applicable
    2. Last two federal tax returns
    3. Last two W-2s or 1099s, if applicable
    4. Proof of any additional income (second jobs, social security, alimony, etc.)
  • Accounts
    1. Last two statements on all bank accounts — be sure to include all pages, even blank ones
    2. Statements for all investment and/or retirement accounts
  • Property
    1. Settlement statement from previous home sale, if applicable
  • Additional documents
    1. Contact information for your landlord(s) for the last two years, if applicable
    2. Divorce decree, separation agreement, and/or property settlement agreement, if applicable
    3. Gift letter if a family member is helping with down payment (lender will have form)
    4. A letter of explanation (LOE) for late payments, collections, judgments, or other derogatory items in your credit history, if applicable
    5. Form 410-4: Uniform Residential Loan Application, filled out by applicant(s)
    6. Form 3550-4: Employment & Asset Certification, a separate form filled out and signed by each applicant
    7. Form 3550-1: Authorization to Release Information, a separate form filled out and signed by each applicant and each adult household member
    8. Form 4506-T: Request for Transcript of Tax Return, a separate form filled out by each applicant
    9. Documentation of child care expenses for dependents 12 or younger, if applicable
    10. Life insurance policy
    11. For any household member who is a full-time student 18 years of age or older, a current school transcript
    12. Annual medical expenses for applicants 62 years of age or older, or with a disability (to be considered for a deduction in household income)
    13. A written explanation of two years of employment history, including an explanation of gaps

Job-Based Incentive Loan Documents

Incentive-based programs — such as Good Neighbor Next Door, which provide mortgage assistance for public servants such as teachers, firefighters, police officers — have their own criteria. If you’re seeking one of these mortgages, you will need these documents for pre-approval:

  • Identification (one of these, which you will need to show in person)
    1. Driver’s license
    2. Passport
    3. Other state- or federal-issued ID
  • Income
    1. Pay stubs for the last 30 days, if applicable
    2. Last two federal tax returns
    3. Last two W-2s or 1099s, if applicable
    4. Proof of any additional income (second jobs, social security, alimony, etc.)
  • Accounts
    1. Last two statements on all bank accounts — be sure to include all pages, even blank ones
    2. Statements for all investment and/or retirement accounts
  • Property
    1. Settlement statement from previous home sale, if applicable
  • Additional documents
    1. Contact information for your landlord(s) for the last two years, if applicable
    2. Divorce decree, separation agreement, and/or property settlement agreement, if applicable
    3. Gift letter if a family member is helping with down payment (lender will have form)
    4. A letter of explanation (LOE) for late payments, collections, judgments, or other derogatory items in your credit history, if applicable
Article by KELLEY WALTERS