Priscilla's Bronxville Real Estate Blog

News and insights on Bronxville real estate, buying, selling, and the Bronxville community.

Refinancing? What You Need to Know in Advance

Posted By Priscilla on January 30th, 2012
Posted in Bronxville Real Estate, Real Estate Trends, Tax Matters | No Comments »

The President, in his recent State of the Union address, called on Congress to approve new legislation that would give all homeowners who are current on their mortgages the opportunity to refinance at record-low mortgage rates.

While details of the program have yet to emerge, the new legislation – in theory – is designed to give responsible homeowners a reasonable chance to refinance without running into roadblocks from lenders. This would also give homeowners an opportunity to take advantage of today’s continued, record-low interest rates.

According to CoreLogic, a company that tracks national mortgage activity, an estimated 28 million homeowners could cut the interest rates on their loans by more than one percentage point if they could refinance. If you’re one of the many homeowners considering a refinance, here are some important facts you need to know first. Be sure to consult with your real estate agent and/or financial advisor, as well.
1.Make sure you are in good standing on your mortgage. As the President emphasized, refinances will be considered for those homeowners who have a good payment history and are current on their mortgages. If you’re currently underwater, a refinance is probably not an option for you. Consult your real estate professional about other options, including loan modifications and short sales.
2.Check your current credit score. Refinance candidates need to demonstrate steady income and good credit. Make sure your credit rating is up to snuff and see what immediate measures can be taken to improve it if it’s not.
3.Examine how much longer you plan to live in your home. If you are planning to put your home on the market in the near future, refinancing probably doesn’t make sense. You need to make sure you’ll be living in your home long enough to recoup the closing costs of the refinance.
4.Consider the length of the loan. Where you’re at with your current mortgage can play a significant role in your decision to refinance. If you’re close to retirement, for example, and your loan is almost paid off, refinancing could result in extending the life of your loan, ultimately costing you more. Also, if you’re several years into a 30-year mortgage, your goal should be to refinance into a 15- or 20-year mortgage instead. Otherwise, you’re extending the number of years in which you’ll pay interest. Your refinancing goals should be short-term and long-term savings.
5.Find out the costs involved. Before you plunge into a refinance, find out the costs involved. Weigh these fees against the money you will save (contingent upon how long you plan to stay in your home) to make sure refinancing is the right step.

For 2012 — Ten Money Saving Tips

Posted By Priscilla on January 30th, 2012
Posted in Buyer, Home and Away, Resources, Seller | No Comments »

Small steps can yield big gains when it comes to improving your personal financial profile. Whether you’re saving for a down payment or dealing with increased expenses having just moved into a new home, the following tips from SWparents.com are great ways to save money in a variety of areas. Start today and you’ll quickly notice the positive impact on your bottom line:
1.You’ve probably heard this since you were a kid, but really…turn off all lights when you leave a room. Train your kids—usually the worst offenders—to do the same.
2.Have an honest conversation with yourself: If you haven’t used your gym membership in more than six months, cancel it. You can always rejoin and probably take advantage of a better deal when you do. Some gyms will even offer to “freeze” your membership, allowing you to pick back up after a certain period of time.
3.Save Starbucks and the like for a special treat. If you buy a $4 coffee five days per week, that’s $80 per month. Record your coffee-buying expenses for a month and see what your own personal damage is…then adjust accordingly!
4.Ditto for lunch. Even grabbing a burger at a fast-food chain adds up. Start packing your lunch instead. An easy way to accomplish this is by cooking extra at dinner or on the weekends, then packing lunch-sized portions in advance. If you’re banking on making lunch during the morning rush, odds are you’ll run out of time and end up buying lunch instead.
5.Do everything you can to increase your credit score. You will save tens of thousands of dollars in interest from any loans you have simply by having a better credit score.
6.Call every company you have monthly bills with and ask exactly what you are paying for each month. You will be surprised how many hidden fees are mysteriously added to your bills. You will never know this unless you ask.
7.Consider paying interest-bearing loans twice a month instead of once a month. You might be able to knock thousands of dollars off your total bill. Arrange automatic payments with your bank on the first and the 15th of each month.
8.Don’t leave the water running while brushing your teeth or shaving in the shower.
9.Odds are you can reduce your cable bill. With the plethora of options for on-demand and online viewing, chances are you no longer need 200 channels and three DVR boxes.
10.Buy anything and everything you can from second-hand stores. Second-hand doesn’t have to mean poor quality. In fact, most people donate items to these outlets because they are unused or hardly used, making it wasteful for them to be disposed of. Utilize this strategy with kids, who grow out of clothing and shoes at a rapid rate. Many teens also love shopping at second-hand stores where they can get the most bang for their buck, along with vintage or retro items.

Building Codes are Critical When Renovating — Here’s Why

Posted By Priscilla on January 30th, 2012
Posted in Priscilla's Articles | No Comments »

People have sometimes been forced to redo or tear down a remodeling project because it didn’t live up to code. While many believe that investigating building codes is too confusing, time consuming and costly, the consequences of not getting the necessary permits before starting a construction project are both upsetting and expensive.

Securing a building permit before you start planning a renovation can also prove critical should you sell your home in the near or distant future. Potential buyers could request proof of permit for that room above the garage you added. Not having one is a risk most buyers wouldn’t want to absorb.

Building codes were designed to set public-safety standards for things like construction, maintenance, use and occupancy. Codes address all aspects of construction, including structural integrity, fire resistance, safe exits, lighting, electrical, energy conservation, plumbing, ventilation, and correct use of construction materials.

In order to make a change to your property, you need a permit that states your renovations coincide with all applicable building codes. Permits may be needed to cover projects such as the installation of foundations and sprinkler systems, the addition of a porch or deck, changes to driveways and room additions. These codes are modified often, and established and enforced by government officials or politicians. Enforcement tactics can include denying permits, occupancy certificates, or imposing fines.

Codes vary with location—each state, county, city and town can have their own specialized codes for things like electricity, plumbing, construction and fire. Typically, each code or permit requires separate inspections and inspectors. Inquire with your city hall to find out the correct department and process for securing permits.

Some homeowners avoid securing a building permit to avoid a potential increase in property taxes should the renovation result in an increase in the assessed value of the property. However, the extra precautionary step is vital and ensures you won’t suffer from repercussions such as hefty fines, or having to tear down your new deck due to improper construction or zoning. Taking the time to check on your local building codes and obtaining a permit will help ensure your renovation project goes smoothly.

Your Credit Card Agreements Could Change — For the Better

Posted By Priscilla on January 30th, 2012
Posted in Home and Away | No Comments »

Do you remember the last credit card you signed up for? More importantly, do you remember the actual contract? While credit card agreements outline such essential information as costs, features, and terms of the product, they are often long, complicated, and written in legalese. Unfortunately, key information about interest rates, fees, billing, and payments is often surrounded by legal fine print.

That’s why the Consumer Financial Protection Bureau (CFPB) launched the Know Before You Owe project, a program designed to provide better consumer transparency in several areas, such as credit card agreements, so that consumers could have a better understanding of the prices, risks, and terms involved before signing on the dotted line.

According to the CFPB, there are an estimated 514 million credit cards in circulation in the United States. Americans used their credit cards to spend an estimated $1.9 trillion in 2010, and credit card debt is estimated at $700 billion dollars. The CARD Act, which was signed into law more than two years ago, was passed to make credit card costs more reliable—with less risk of unexpected rate increases or other charges.

But despite this progress, a recent study by J.D. Power found that roughly two-thirds of cardholders say they don’t completely understand how their cards work. And, as indicated in a recent CFPB report on credit card complaints received by the Bureau from July 21 to October 21, 2011, difficulty understanding the terms of their cards is a contributing factor in many consumer complaints.

With this in mind, the CFPB has created a prototype credit card agreement that is shorter, written in plain language, and explains key features upfront. This prototype is scheduled to be tested with the Pentagon Federal Credit Union to get on-the-ground consumer feedback before it becomes official.

Here are the four key improvements the CFPB prototype offers:
•Shorter: The CFPB’s prototype is shorter – its word count is about 1,100 words, while the industry average for a credit card agreement is around 5,000 words.
•Clearer: The draft credit card agreement has an easy-to-read layout and is written in plain language. It is organized into three simple sections: costs, changes, and additional information.
•More consumer-friendly: The simplified agreement explains the prices, risks, and features of the credit card upfront, as opposed to burying it in fine print.
•Consistency: The prototype establishes standard definitions for legal terms like “card” and “balance transfer” that are contractually necessary but largely uninformative to consumers. These definitions are based on standard industry usage and practices and will be housed online where consumers can readily access them. For consumers who do not have Internet access, the definitions will be available from their issuer in printed form. According to the CFPB, doing this allows for a plain language document that clearly explains to consumers how the credit card works.
For more information about Know Before You Owe, and to view a copy of the prototype credit card agreement and the database, visit www.consumerfinance.gov.

WHY CASH IS KING

Posted By Priscilla on January 23rd, 2012
Posted in Bronxville Real Estate, Buyer, Real Estate Trends, Resources, Seller | No Comments »

Beyond the Numbers 1.4.12

WHY CASH IS KING
By: Priscilla Toomey
Associate Broker, JD, Top5, ABR
Bronxville-Ley Real Estate

With the New Year comes resolutions, and one of the most common is to slim down. If you are planning to buy real estate in the near future, slimming down on spending while fattening up your cash reserves is another worthwhile resolution to make — and keep. In other words, save as much cash as possible for the transaction ahead.
That’s because in real estate “cash is king” and the more you have, the stronger your buying power will be. Locally, 20% equity (cash) is typically expected, although it can be more or less than that, depending on the transaction.
Sellers tend to prefer a higher percentage of cash if the buyer can pay it. That’s because in the event the property doesn’t “appraise out” for the agreed-upon price, there is still enough of a cash cushion for the transaction to go forward and close.
Appraisals are an important factor in the desire for more cash in a purchase. These days, appraisers tend to be more conservative. After all, they are working to protect the bank, not working for the buyer. Appraised value is important because lenders normally won’t lend more than 80% of the appraised value for a conventional loan.
Despite having been in a “buyers market” for some time, there have been some bidding wars. In those instances, the question may be what kind of a premium a buyer getting a mortgage needs to offer to outbid an all-cash buyer? Recently, a 5% premium offered by the buyers wasn’t enough to overcome an all cash bid. The ability of the all cash bidder to close almost immediately, instead of the sellers having to wait for a mortgage commitment to come through, plus eliminating the need for an appraisal, made the preference for the all cash offer understandable.
To prepare for the coming Spring Market it is wise to have as much cash available as possible – and to be prepared to deploy it to get the house you want.

For real estate sales in Bronxville Village at year-end 2011, inventory had decreased. There are currently 23 single family homes on the market plus 4 townhouses. Another 4 single family homes are under conditional contract, while the sales of 3 are pending. One townhouse is under conditional contract and the sale of another is pending. One condo apartment is active on the market and there are none under contract or whose sale is pending. There are 27 active co-ops, plus 5 under conditional contract and three whose sales are pending. Evidencing the decrease in inventory, in November, the number of single family homes on the market was 29, the number of townhouses was 10, the number of co-op apartments was 39 and the number of condominium apartments was 2.
During full-year 2011, 39 single family homes sold, and 9 townhouses sold. Thus, at the moment, there is a little more than a six month inventory of single family homes and a little less than a six month inventory of townhouses. The question is how many more homes will be added to inventory as we get further into 2012.
Between January 1, 2011 and December 31, 2011, the sales of 39 single family homes closed, as did the sales of 9 townhouses, 7 condominium apartments and 36 co-op apartments. During the same period in 2010, the sales of 59 single family homes closed, as did 19 townhouses, no condominium apartments and 41 co-ops. The number of sales of single family homes and townhouses combined for 2010 was thus 78, an increase from prior years representing a year when pent-up demand was a significant factor driving the market.
Mortgage interest rates continued to fall slightly month to month. According to BankRate.com, for a 30 year conventional fixed-rate mortgage, they were at 3.94% versus 4.06% in mid-November. Fifteen year conventional fixed rate mortgages averaged 3.28% versus 3.37% in mid-November. Five year adjustable rate mortgages averaged 2.88% versus 3.01% in mid-November. *
The full year data shows a smaller than usual inventory of homes for sale in the Bronxville Village market. The absorption rate for both single family homes and townhouses is approximately 6 months, and for co-ops it is about 9 months, representing a decrease in both categories in the past few months, and a number representing a market which is more balanced between buyers and sellers in the single family home/townhouse segment. The next couple of months will signal to what extent the local market is recovering.

*Source of mortgage rates: BankRate.com

Refinancing Your Home — 5 Tips to Know

Posted By Priscilla on January 23rd, 2012
Posted in Bronxville Real Estate, Real Estate Trends, Tax Matters | No Comments »

Despite the tightness of money these days, for people with a sufficiently high credit score and equity in their house, refinancing is still a popular option, as it can be a smart way to simplify and save money. Below are five reasons why you might want to consider refinancing:

1. To Get a Lower Mortgage Rate
Many lenders today are offering low rates, making a refinance a smart decision for struggling homeowners.

2. To Cash Out and Lower Debt
Several years back, a cash-out refinance was a popular way for homeowners to get their hands on some extra cash to do things like add renovations or purchase a new car. While this trend has become less popular, many are still using the cash-out refinance option to pay off their debt.

3. To Cash Out and Buy Property
Investment properties are a trend on the rise. Many homeowners are choosing to refinance their home to buy a second property to use as an investment.

4. To Convert to an ARM
Refinancing as a way to switch from an adjustable-rate mortgage to a fixed-rate can give homeowners not only a better rate, but a stable rate too. With inflation looming, having a fixed-rate loan makes many homeowners feel more comfortable.

5. To Consolidate Two Mortgages
Some homeowners want to refinance in order to combine their first mortgage with their home equity line of credit. Although home equity loan rates are often shockingly low, many people are worried about rates jumping in the future. By combining their two loans into one, they feel safer—plus paying off one loan can be more appealing than dealing with multiple credit lines.

Managing Your Money as a Couple: 6 Helpful Tips

Posted By Priscilla on January 22nd, 2012
Posted in Bronxville Real Estate, Home and Away | No Comments »

Nowadays, it’s more important than ever that couples take the time to sit down and discuss their finances and financial goals. Whether you already have a money management system in place—or you need help getting started—there’s no better time than the present. Not only will a well thought-out plan keep both of you moving in the same direction toward your goals, it will also help to open the lines of communication so that you and your partner can talk more freely about financial problems, concerns and decisions.

According to Jane Honeck, CPA and author of The Problem With Money? It’s Not About Money! offers the following money managing tips.

1. Talk, Talk, Talk. Money is still a taboo topic and we often don’t have a clear idea about how our partner thinks or feels when it comes to spending versus saving. Talking about your goals with your partner is a simple way to make sure you’re both on the same page when it comes to your finances.

2. Find Balance: Balance power around money. One person making all the decisions and having all the control when it comes to finances is often a recipe for disaster. Find ways for you both to be equally engaged in all money decisions.

3. Define Your System: Have a clearly defined money management system that covers everything from who handles the mail to who sends out the checks. Without a well thought-out plan in place, it’s more likely that things will fall through the cracks.

4. Address Problems: When problems arise, address them immediately (no secrets allowed). Avoiding the issue only makes it more toxic and drives a wedge in the relationship.

5. Perform Checkups: Schedule an annual money checkup. Things change and just like our physical health, money management needs an annual checkup to keep it healthy and relevant. Set aside time to sit down with each other and evaluate what’s working, what needs to be fixed and address any questions or concerns that either of you may have.

6. Keep the Lines of Communication Open. The most important thing to keep in mind when dealing with your finances is to continue to communicate with no blame or shame. We all have hang-ups around money, so it’s important to treat your partner with compassion when it comes to your finances.

FIREPLACE SAFETY

Posted By Priscilla on January 22nd, 2012
Posted in Bronxville Real Estate, Taking Care of Your Home | No Comments »

As temperatures drop, fireplaces are there as a wonderful way to bring warmth and atmosphere to your home—especially during very cold weather. No matter what kind of fireplace you havem be it wood burning or gas, it is crucial to make sure it is properly prepped for an active season. This ensures not only functionality but more importantly, your safety.

Here are some must-do steps from Napolean Fireplaces to get your fireplace ready for action. Most of these can be done by the average homeowner, however, don’t hesitate to call your local chimney sweep or fireplace expert if you’re at all unsure.

For wood-burning fireplaces:
•Have the chimney cleaned. The leading cause of fires from wood-burning appliances is the result of creosote (unburned fuel) that has accumulated in the chimney.
•Have any gasket material inspected and replaced as required, such as the gasket sealing the door, the door glass and in some cases the ash dump. If an airtight appliance is operated without these gaskets effectively sealing the openings, excess air can leak into the firebox creating an over-fire condition, which may permanently damage the appliance.
•Clean the blower if your wood-burning appliance is equipped with one. Unlike your furnace blower, these blowers do not have a filtering system to prevent the buildup of dust and hair on the blower.
•Replace any broken or deteriorated brick lining. While cracks in the lining are not a concern, if the brick lining is deteriorated to the point that the steel body is exposed, the heat from the fire can cause permanent damage to the appliance.
For gas-burning fireplaces:
•Have the appliance serviced by a qualified technician. A properly maintained fireplace can look as new as the day it was installed. Even the glass must be cleaned annually to keep it looking clear. Although gas fireplaces appear to be maintenance free, these combustion systems are affected by problems such as dust and insects, which could impair performance. The airways of both the pilot and main burners should be regularly cleaned to ensure that they are operating correctly.
•Clean the blower if your gas-burning appliance is equipped with one. As dust accumulates on the blower blades, the balance of the blower will change causing premature wearing of the bearings. The dust also insulates the motor, preventing it from being cooled and can eventually cause the motor to seize.
•Replace the batteries in any optional remote transmitters and in some cases, in the receiver as well. Even when not being used the power held in a battery is slowly depleted.
No matter what type of fireplace you have, remember to replace the batteries and test any smoke or carbon monoxide detectors you have in your home to ensure these defense monitors are operating properly.

Bring Your Home to Life with Effective LIghting

Posted By Priscilla on November 27th, 2011
Posted in Real Estate Trends, Real Estate Videos | No Comments »

Navigating Health Insurance Decisions — 6 Helpful Tips

Posted By Priscilla on November 18th, 2011
Posted in Home and Away | No Comments »

If you’re struggling with medical costs and trying to find a solution to your health insurance woes, you’re not alone. Roughly half of all bankruptcies filed in the United States are caused by illness and medical bills, and there are still 46.6 million Americans without health insurance.
While it’s easy to become overwhelmed by health insurance issues, attacking the problem is critical to not only your personal health but your financial health as well. Journalist, author and “Today Show” commentator, Jean Chatzky (jeanchatzky.com), offers the following great suggestions for choosing the right health insurance plan and preventing costs from escalating:
1.Check state regulations. Insurance plans and prices vary widely by state, so begin by investigating your state’s insurance website. Look for lists of companies in your area, prices for various types of plans, and lower-cost options based on income requirements.
2.Decide what’s important. Make a list of what matters most to you, i.e., low premiums, the ability to see certain doctors, coverage for special services, etc. The plan you ultimately choose should accommodate your insurance priorities.
3.Find an insurance broker you can trust. Finding a top-notch insurance broker is critical as he or she can do the legwork to find the right insurance company, help shop for the best rates, and explain the ins and outs of your plan, says Chatzky. Check a candidate’s credentials through either the National Association of Insurance Underwriters (nahu.org) or the National Association of Insurance Commissioners (naic.org). Make sure the broker you choose has a large “book,” the industry term for the network of providers he or she works with. The more options, the better.
4.Ask for a trial run. Believe it or not, you might be able to “try out” an insurance plan before committing to it—this is called a “free look,” says Chatzky, and means you can get a refund if you’re not satisfied after a certain period of time. Follow the guidelines so you don’t overlook any loopholes in a free-look option, and be sure to get the details in writing.
5.Open a Health Savings Account (HSA). An HSA is a great option for those choosing a high deductible/low premium plan as it allows you to deposit pre-tax dollars into a special savings account for medical expenses, where it will grow tax-deferred. Once you turn 65, you can withdraw any remaining money and use it however you want, including to fund your retirement.
6.Be ready to negotiate. While you may have spent a lot of time researching and choosing your plan, unexpected bills will most likely continue to pop up. Talk to your insurer about the right protocol for negotiating such bills. And don’t be afraid to negotiate with your doctor if you’re paying out of pocket, Chatzky advises. In a recent Harris Interactive poll, three out of five people who did so received a discount. With the cost of a single visit often tallying over $200, it’s definitely worth a try.