Archive for Mortgage News
The VA loan boasts low delinquency rate
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Most mortgage loans require a down payment, but veterans may be exempt. The VA Loan Guaranty program offers eligible servicemen and women the opportunity to purchase a home with no down payment and no mortgage insurance premium. How have VA loans fared in comparison to other kinds of mortgages?
At the end of the second quarter of 2010, the delinquency rate for VA loans was 7.79 percent, compared to 13.3 percent for FHA and 17 percent for subprime. Only prime loans dipped below VA at 7.1 percent. In the foreclosure category, VA loans at 2.50 percent fared better than the rest (subprime 14.4 percent, FHA 3.62 percent, and prime 3.49 percent).
Mortgage News Daily attributes the success of VA loans to several components including a neutral appraisal process and foreclosure avoidance help for homeowners at risk of default. But the key factor lies in the eligibility process. Applicants must demonstrate a debt-to-income ratio of less than 41 percent and adequate residual cash (after major expenses) at the end of the month. Residual income reflects the ability to shore up finances for the rainy days ahead.
Thomas J. Pamperin, a VA deputy under secretary, described the VA loan as “a model of stability.” If you have been honorably discharged from the military and meet the financial requirements, the VA loan could be a great deal. Because this government program has stayed above the fray of foreclosures, some in the industry feel that its lending standards should be replicated for civilian loans.
Advice for Parents as Their Kids Head Back to School
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Now is a great time to teach your children lessons about managing money. Here’s how.
By Janet Bodnar, Kiplinger.com
One positive outcome of the financial turmoil over the past couple of years is that parents and kids are talking more frequently about financial issues. In the T. Rowe Price Parents, Kids & Money survey released earlier this year, nearly half of the parents interviewed said they are having more conversations with their children about money and the basics of saving versus spending.
And, yes, Mom and Dad, your children are willing to listen. In fact, 65% of kids said they had approached their parents to talk about money issues.
Unfortunately, the lessons don‘t always stick. For instance, a majority of kids who get an allowance sometimes spend it all at once and many of them come back for more. As students head back to school, parents have a golden opportunity to take advantage of a prime teachable moment for kids of all ages.
Elementary and middle-school students: Start an allowance. When children enter first grade, they learn that four quarters equal ten dimes equal one dollar, and they have a more sophisticated understanding of just how far money will go and how to parcel it out.
Start with a basic weekly allowance equal to half a child’s age. You can adjust that up or down, depending on how much you expect your kids to pay for.
Unless you‘re very well organized, I don‘t recommend that you tie the basic allowance to household chores. It‘s tough to keep track of what the kids have done (or not done). And they should be doing some tasks without pay to lend a helping hand.
Instead, give the kids financial “chores,” such as paying for their own collectibles or refreshments at the movies. Giving youngsters a fixed amount of money – and certain responsibilities to go along with it – teaches them how to make choices, and makes it less likely that they‘ll spend it all at once and come back for more.
To teach kids the value of being paid for their labors, you can pay for extra household tasks on a job-by-job basis. That also makes it easier for you and the kids to keep tabs on what they‘ve done.
As children enter middle school, you can expand their allowance – and their responsibilities – to include other expenses, such as mall excursions, after-school snacks with friends and movie tickets.
High school students: The average American family will spend more than $600 on clothes, shoes, school supplies and electronics, reports the National Retail Federation, so the back-to-school shopping season is a great time to introduce a clothing allowance. Nothing will focus your teen‘s attention on wants versus needs more than having to fill out her wardrobe on a fixed income.
Mining her closet for things that are still wearable is a good first step. Then she can decide whether she really wants to splurge on a single pair of Juicy Couture denim leggings for $128 or get a couple of pairs from Old Navy for $34.50 each – and still have money for new tops.
This is also a good time to help your kids set up a checking account, especially if they have earnings from a summer job. Community banks and credit unions may be more customer-friendly to teens than big banks. If your bank balks, you can always cosign for the account.
Another alternative is to give kids access to their savings account with an ATM card so that they can make deposits and withdrawals. The point is to give them more freedom (and responsibility) to manage their account, and avoid overdrafts, before they head off to college.
College students: It often comes as a surprise to parents and kids that they don‘t agree on who‘s going to pay for which expenses. And it‘s an even bigger shock when the bills start rolling in a month or two into the semester. So cover all the bases before you drop your kids at the dorm.
Let your kids know, for example, that you‘ll pay for textbooks, but to lower the cost they should look into campus book exchanges, discount Web sites, book rentals and digital books (see How to Cut Textbook Costs in Half – or More).
You‘ll pay for the school meal plan, but beer and pizza on Saturday nights are on their tab. And tell your kids that they‘ll have to share discretionary expenses, such as Greek fees, so they should think twice before pledging.
New laws covering bank overdraft fees and credit cards for young adults hit college students squarely in the wallet. For advice on how to handle those situations, see 5 Financial Lessons for College Students.
Reprinted with permission. All Contents ©2010 The Kiplinger Washington Editors. www.kiplinger.com.
Mortgage Success Source, LLC is the copyright owner or licensee of the content and/or information in this email, unless otherwise indicated. Mortgage Success Source, LLC does not grant to you a license to any content, features or materials in this email. You may not distribute, download, or save a copy of any of the content or screens except as otherwise provided in our Terms and Conditions of Membership, for any purpose.
Credit Reports: One May Not Be Enough
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This summer, Fannie Mae instructed lenders that they should adopt a new policy that would include a second review of an applicant’s credit report just prior to closing. Why? The answer is simple: the credit profile of a borrower may have changed between the time of the initial review of the credit report and the time of closing.
How will this impact the home loan?
The potential impact to a borrower who has utilized credit to make significant purchases after the initial credit report could include:
- A delay in closing
- Increase of closing costs and/or interest rate
- A decreased loan amount
- Denial of the loan
That‘s right, in the worst-case scenario, a change in credit could even result in a loan being denied – even after an original approval had been granted.
What should homebuyers do (or not do)?
In order to eliminate any possibility of potential problems before closing, anyone in the application process should use credit sparingly and make sure they adhere to the tips provided below by credit expert Linda Ferrari of Credit Resource Corp:
- Don’t do anything that causes a red flag to be raised by the scoring system.
- Don’t apply for new credit of any kind.
- Don’t pay off collections or charge offs.
- Don’t max out or over charge on your credit accounts.
- Don’t consolidate debt onto one or two credit cards.
This list is not comprehensive, but it does give you a peek into situations that could create issues and could also be contrary to some ideas you have read previously.
And certainly, seeing our economy improve is change in the right direction. But what steps will get us there… and how will those steps impact home loan rates. Here‘s what you need to know.
Last Tuesday, the government held a “Future of Housing Finance” conference to discuss changes needed in this area. Most participants agreed that government assistance for housing must be reduced but not eliminated. Bill Gross, from PIMCO and one of the panelists, called for a massive refinancing of certain mortgages backed by Fannie/Freddie/FHA, believing such a move would lift home prices 5% to 10% and provide a $50 Billion stimulus to the economy. I will be watching this situation closely for further developments.
Home sales and the job market – two key aspects to our continued recovery – are also areas we need to see change in an improving direction. Last week, the NAHB Housing Market Index came in a bit worse than expectations and showed housing to be at a 17-month low. It can be argued that the tax credits actually hurt the housing market by not adding any sales, just pushing them up. This has now resulted in a void or softer period in the market, potentially wasting billions of dollars. Housing Starts and Building Permits were also reported lower than expected last week. Clearly, demand for housing has slowed over the past few months, due to the expiration of the Home Buyer Tax Credit and persistently high unemployment.
Speaking of unemployment, awful is the only way to describe last week‘s Initial Jobless Claims report. According to the report, 500,000 people filed to receive unemployment benefits for the first time, which was well higher than the lofty 475,000 expected and the highest reading since November 2009. In addition, between Continuing Claims and people receiving Emergency Unemployment Compensation or EUC, the combined total of people receiving unemployment benefits now equals 9.25 Million people.
The bottom line is this: The labor market is the foundation of our economy. Job growth and confidence is the best and most sustainable way for our economy to recover. The present anti-business regulatory environment is pushing Initial Claims, a leading indicator on the health of the labor market, in the wrong direction.
But home loan rates, meanwhile, continue to remain at historic low levels. Though keep in mind, inflation is the arch enemy of Bonds and home loan rates, which means it can cause both to worsen. Both the Producer Price Index (which measures inflation at the wholesale level) and the Consumer Price Index were recently reported hotter than expected. If rates do start to rise, they will likely do so quickly.
If you or anyone you know would like to learn more about taking advantage of historically low home loan rates, please don‘t hesitate to call or email. Or forward this newsletter on to anyone you think may benefit and I‘d be happy to talk to them free of charge.
7 Ways to Teach Financial Responsibility to Children
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If the current economic climate has taught us anything, it‘s that financial education and responsibility are critical in today’s fast-paced, wired world. All too often, however, children grow up immune to the financial world around them. As a result, they’re often ill equipped to manage their own finances when they become adults and leave home.
With the economy in the news almost daily, now‘s a perfect time to start educating your children about how to manage money more responsibly. The tips below can help you get started.
1. Pay an Allowance
If your children don’t have money of their own, it’s hard for them to really grasp the value of it. So if you don’t pay your children allowance, consider starting. You don‘t need to pay a lot – a little goes a long way. The most important thing is that your children learn the value of completing even small chores around the house to earn their own money.
2. Make a Plan and Set Guidelines
Before you actually start paying the allowance, sit down with your children and set some expectations. Discuss the specific chores and timelines for completing those chores, as well as the amount of money they‘ll earn for each chore and when they‘ll be paid. This helps instill a strong work ethic in children as well as drive home the message that money is earned, not given.
3. Save for the Future
As part of your financial discussion, consider implementing a savings rule for your children. For example, make a rule to save half or one-third of their allowance. You can go with them to the bank to establish a savings account in their name and then take them to make their deposits. Or, if your children are still young, you can decorate a jar to use as a special savings bank at home.
4. Educate on Interest
Once a month, sit down with your kids and count how much they have deposited, how much interest they have earned, and how much they have as a result. Compare the amounts each month, so your children can see the benefits not only of saving, but also the benefits of compounding interest.
5. Take Your Children Shopping
Take your children grocery shopping with you. As you go down your shopping list, have your children help you compare the prices of the different brands, sales, and quantities per package. You can also have you children try to keep a running tally and make a guess of what the total cost will be.
6. Set Them Free to Shop
Once your children have a sense of money matters, you may want to take the lesson up a notch. For instance, when your children need new school clothes, you try giving them the money and putting them in charge of what to buy. Then, as they shop, help them compare the prices and number of items they can purchase within their budget. You could even purchase a gift card with a specific dollar value on it. That will help your children not only learn about the value of a dollar and making smart purchases, but it‘ll also introduce them to the credit card system, in which money may not seem real because it‘s unseen. In today‘s electronic financial world, this lesson will become more and more important as your children get older.
7. Teach by Example
Remember, children are always watching. So if you educate them on saving for purchases and budgeting but make rash decisions on big-ticket items yourself, you may find them learning a different lesson than you intend. So make sure you follow your own rules when it comes to spending, saving, and fiscal responsibility.
At times your children may beg for an exception. But by being consistent, your children will be much better prepared to deal with the real financial world that they‘ll face when they grow up.
Mortgage Success Source, LLC is the copyright owner or licensee of the content and/or information in this email, unless otherwise indicated. Mortgage Success Source, LLC does not grant to you a license to any content, features or materials in this email. You may not distribute, download, or save a copy of any of the content or screens except as otherwise provided in our Terms and Conditions of Membership, for any purpose.
“Tweets” Can Help Grow Your Business
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Twitter is spreading like wildfire and companies are using it to boost sales. By Michael Doan, Kiplinger.com
You know Twitter – the social networking and microblogging service that allows people to keep in touch through “tweets” – short snippets of text sent to cell phones, BlackBerrys and PCs.
Businesses are making use of the Web format for marketing, research and customer services. Computer maker Dell sends coupons to its Twitter users. Whole Foods Market offers $25 gift cards as prizes for people who submit the catchiest messages promoting Whole Foods. Other companies send messages to foster community and build loyalty to stores and products. Uncle Sam is a player, too. The Food and Drug Administration uses Twitter to help get out the word about product recalls.
Because most Twitter messages are searchable on the Web, businesses can also use it to track customer comments and answer complaints – even offer immediate help or advice. Among firms closely tuned in to what customers are saying are Southwest Airlines, JetBlue, Comcast and Boingo, which provides Wi-Fi service at airports.
Jeremy Pepper, public relations manager of Boingo, receives and tracks all Twitter messages, blogs and other Web comments that mention the company. If, for example, someone complains to a friend about a weak Wi-Fi signal at Washington Dulles International Airport, he may get an immediate message from Pepper.
In such a case, Pepper says he’ll ask: “‘Where you are sitting…have you thought of moving? Which terminal are you in? Let me check to see if there are problems at the airport,’” he says. Once a problem is resolved, he’ll send a tweet saying he was happy to help and “have a safe flight.”
Quick, helpful responses via Twitter can go a long way to changing customers’ opinions about a firm, even turning detractors into company promoters.
Keep messages informal and conversational. “Being boring is the worst thing you can do,” says Jeffrey Mann, vice president of research at Gartner Group, an information technology research firm. Business tweets should be personalized; you may want to designate one or more employees to twitter on behalf of the company. Keep in mind that Twitter messages – limited to 140 characters each – are seen by people who choose to become “followers” of a business or an individual.
Twitter is a good tool to use at trade shows, helping to draw attendees to exhibitors’ booths as well as press conferences and receptions hosted by a company or trade group. The Oklahoma City Chamber of Commerce, for example, puts out messages about its Schmooza Palooza networking party and trade show before, during and after the event in hopes of spreading buzz about it. Results are good; attendance has grown dramatically.
Twitter is great for small businesses, too, because it’s easy and doesn’t add any expense. The only cost is the employee time it takes to write and follow others’ messages.
Consider registering your company’s name with Twitter, even if you don’t expect to use it. It’ll help prevent misuse by someone else. Go to www.twitter.com.
Reprinted with permission. All Contents ©2010 The Kiplinger Washington Editors. www.kiplinger.com.
They say the only constant is change”¦
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And more change is coming, as the sweeping Financial Regulation Bill was passed by the Senate last week and will be signed by President Obama in short order to become law. So what does this change mean… and how will it impact home loan rates? Here’s what you need to know.
The Bill calls for a new consumer protection agency and prohibits Banks from taking risky bets. While those things are important, it’s also important to realize that this legislation… over 2,000 pages worth… amazingly does nothing to address the core reasons for the financial collapse. Fannie Mae and Freddie Mac are completely left out of this legislation. The credit rating agencies, who may have played the largest role in the financial collapse, also go unmentioned.
In fact, when former Fed Chairman Alan Greenspan was asked about the Financial Regulation Bill, he noted that this was the first time the Fed was not asked to write a regulation of this kind. He also said that there are “unintended consequences” in every page of this bill.
And one consequence we’ve seen already is that corporations are hoarding cash, and are somewhat stuck like a deer in the headlights due to the uncertainty that this and other pending legislation is creating. And when corporations hoard cash, they don’t typically hire workers, and job creation is crucial to our recovery.
What all this will mean for our economy and home loan rates remains to be seen… which is why now is the perfect time to act, while home loan rates continue to be some of the best they have ever been! If you or anyone you know would like to learn more about this exceptional opportunity, please don’t hesitate to call or email. Or forward this newsletter on to anyone you think may benefit and I’d be happy to talk to them free of charge.
In other news, there hasn’t been much change on the inflation front, which is good news for Bonds and home loan rates. Remember: inflation erodes the return of an asset like a Bond… so inflation is the arch enemy of Bonds and home loan rates. Both the Producer Price Index – which measures inflation at the wholesale level – and the Consumer Price Index for June showed that inflation continues to remain tame.
However, two changes that would be welcome are in the retail sales and manufacturing areas. Retail Sales for June came in lower than expected for the second month in a row. Although details of the report were mixed, the overall indication is that consumers and businesses remain cautious on purchasing big-ticket items. In addition, the Empire State Manufacturing Index and Philly Fed Index showed that factories and manufacturing still look very sluggish overall. Changes for the better in both of these areas will be reflective of our economy growing stronger, and these are things to watch for moving forward.
All in all, the news from last week helped Bonds and home loan rates reach record levels again, and they ended the week about .125 percent better than where they began.
Six Money Mistakes of Newlyweds
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By Erin Burt
Kiplinger.com
Whether you’re planning a walk down the aisle soon or you’ve already gotten hitched, watch out for these financial pitfalls that can strain even the strongest marriage.
Four words no one wants to hear soon after his or her wedding day: “We made a mistake.”
I’m talking about financial choices – not your choice of spouse. Unfortunately, many newlyweds set themselves up for failure soon after they say “I do.” If you bring bad money habits to the marriage or fail to come up with a plan to merge your financial lives, you could potentially doom your relationship to money trouble – and endless arguments. Not exactly “happily ever after.”
However, nothing says “I love you” like the desire to start your marriage on the right financial foot (roses, schmoses). Here are six common pitfalls that trip up new couples. Steer clear of these, and you’ll decrease the money tension and increase the harmony in your new life together.
1. Keeping money secrets
Money is one of the most common sources of arguments in a marriage, so it’s best to simply avoid the subject altogether, right?
Wrong! Some of the most heated arguments stem from failing to discuss financial backgrounds, expectations and attitudes from the start. Communication is key to the survival of any relationship, and bearing your financial soul to your partner is no exception.
Ideally, you want to have this conversation before walking down the aisle. After all, there are good marital surprises (”Didn’t I tell you I’m a gourmet chef?”) and bad surprises (”Didn’t I tell you I have $20,000 in credit card debt?”). Full disclosure is in order here – and that includes your shoe fetish or gambling habit. For tips on what to discuss, see Ten Questions to Ask Before Saying ‘I Do.’
2. Not having a budget
Now that you’re settling into your new life together, it’s time to discuss the b word. No, not baby. Budgeting. You’re merging two spending habits and two saving habits into one household. So even if you had a budget when you were single (pat on the back), you’ve got to make a new one with your husband or wife to include his or her income, debts and monthly expenses. That will help to ensure you have enough money left over for that other b word – Bahamas.
Use our budget worksheet to start. Your first step is to write down your fixed expenses – such as your rent, car payment, insurance premiums and student loan payments. You should also make a habit of contributing to your savings or investments as if you were paying a fixed bill each month. Then write down your flexible expenses, such as utility and phone bills, transportation costs, groceries, trips to the ATM, and miscellaneous purchases. Track your actual spending for a couple of months to see where your money really goes, then find the spending leaks and plug them. Building a budget is a great way to set common spending and saving goals, identify problems, and work together to fix them.
3. Giving one person the financial reins
The honeymoon’s over, and it’s time to get down to the nitty-gritty of the daily finances. Who will physically pay the bills, monitor the investments and crunch the taxes? One person may be more inclined toward these tasks, or you may decide to split the responsibility or trade off each month.
There’s nothing wrong with letting one person take over the family finances, as long as both partners are okay with that decision. But that doesn’t mean the other partner should be excluded. It’s important for each person not only to feel involved in the big financial decisions but also to have an understanding of the day-to-day finances. You each need to know all your different account information, passwords and bill due dates in case anything were to happen to the other person. And no matter how you divide the responsibility, it’s a good idea to have a regular “money date” each month or so to make sure each of you is in the loop. You should go over your budget, review your savings progress and discuss upcoming expenses together. How’s that for keeping the romance alive?
Also, if you choose to combine your finances after you wed, make sure that major purchases and savings accounts are held in both of your names so that each of you has equal access and can maintain a credit rating. You don’t want to find out in the event of a divorce that your name wasn’t actually on the car title or savings accounts.
4. Dragging debt down the aisle
What’s his is hers, and what’s hers is his. Whether you decide to combine your finances or maintain a separate approach, if one of you brought debt into the marriage, it becomes a problem for both of you. You’ll need to work together to come up with a plan to pay it off. However, you should never officially commingle your debt. Doing so could hurt the credit score of the other partner and make it difficult for one or both of you to get credit later. Keep existing credit-card and loan accounts in the original holder’s name.
If you can help it, it’s best to avoid beginning your marriage in the red. Many newlyweds make the mistake of going too far into debt to pull off the wedding of their dreams, go on an exotic honeymoon, or buy brand-new furniture and appliances for their home. Before you dig too deep, you should sit down together to determine which expenses are necessary and which are worth a splurge – and come up with a plan to pay for it all before you spend it.
5. Sweating the small stuff
Marriage is about compromises and simply letting some things slide. So she squeezes the toothpaste tube from the middle, and he doesn’t pick up his socks. Big deal. You’ll both soon learn to pick your battles and save your energy for issues that really matter.
That goes for picking your money battles, too. I remember my first financial argument with my husband. We had been married two weeks, and we were doing our grocery shopping together. He wanted to buy the brand-name chocolate chips, and I felt strongly that we should save 75 cents and go with the off-brand chips. After a lengthy and heated exchange, we divided up the rest of the shopping list so that we wouldn’t have to look at each other for the rest of our outing. Then we drove home in a huff. Lesson learned: Never go grocery shopping when you’re hungry, tired and irritable. Oh, wait. Financial lesson learned: Don’t sweat the small stuff. Was the argument really worth 75 cents? No way.
Of course, if all the little stuff is adding up to a big drain on your finances and causing you to live beyond your means, bring it up at your next money date and work together to find ways you can both cut back. (Ah, there’s that compromise idea again.) But take note: It’s important that you build a little “mad money” into your budget for each person to spend at his or her own discretion. (Can you imagine asking your spouse for permission every time you wanted to buy a cappuccino and a muffin, or grab a drink with some friends after work?) But as far as the big stuff goes, make it a rule to consult the other on major purchases. You don’t want to come home and unexpectedly find a brand-new Mercedes in the driveway, and the bill that goes with it.
By the way, I now go grocery shopping alone. We decided as a couple it’s what’s best for our marriage.
6. Failing to plan for an emergency
No one likes to think about bad things happening, but in all the excitement of your engagement, planning your wedding and moving in together, it’s easy to overlook this important aspect of financial planning. One of the best gifts you and your spouse can give each other is financial security and protection from life’s storms.
First, assess your emergency stash of cash. Every couple should have enough money available to cover from three to six months worth of living expenses. You never know when the car will break down, one of you will lose a job or you’ll have an unexpected medical bill. Learn more about how to build your financial foundation and where to keep the money.
Then, you need to make sure you have adequate insurance coverage, including health, auto, renters or homeowners, and possibly life insurance. Learn more about the types of insurance everyone should have, and how to get the appropriate coverage.
Did you get married without a prenuptial agreement? It’s not too late to protect the financial interests each partner brought to the marriage. Consider drafting a post-nup with your lawyers. Plus, make sure you each have written a will to divide your assets in the event of your death.
See Also: Secrets to Marital and Money Bliss, 10 Questions to Ask Before Saying ‘I Do’, A Primer on Prenups
Reprinted with permission. All Contents c 2010 The Kiplinger Washington Editors. www.kiplinger.com.
“Insuring” a Smart and Safe Vacation
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Summer is right around the corner, and that means many people are starting to plan some kind of summer getaway.
When planning your fun-filled itinerary, the last thing you want to do is worry about any financial loss that might occur as a result of a missed flight, an injury or illness, lost baggage, or any other unforeseen incident. To ensure your peace of mind while away from home, many companies provide several different types of traveler’s protection plans to help ease the burden.
Without insurance, a traveler can lose nonrefundable deposits and prepayments that can add up to hundreds, or even thousands, of dollars. A good, comprehensive travel insurance plan will often reimburse a traveler for all pre-paid, nonrefundable expenses for a covered loss.
Here are some general types of coverage you may want to consider before heading out for this summer’s vacation:
Travel Arrangement Protection – This covers you in case of trip cancellation, interruption, or travel delays (these can include inclement weather, lost or stolen passports, quarantine, hijacking or natural disaster).
Medical Protection – Just because you have health insurance at home, the moment you set foot on foreign soil or even set sail on a cruise, many health plans are considered null and void, so be sure you get travel medical protection to cover emergency medical expenses, such as illness and accident expenses, and emergency medical transportation to the nearest medical facility.
Baggage Protection – Not only do you want coverage for lost, stolen or damaged baggage, but many plans offer reimbursement for the purchase of essential items if baggage is delayed.
Worldwide Emergency Assistance – If traveling outside of the country, make sure you purchase a policy that covers international emergencies. This can include emergency cash transfer assistance, legal assistance, and lost travel documents assistance.
The cost of travel insurance is based, in most cases, on the value of the trip and the age of the traveler. Typically, the cost is 5-7 percent of the trip cost. Like most every other type of insurance, be it automobile, medical, or homeowner’s, you hope you never need to use it. But it can be a relief to have it when you do need it.
The bottom line is: Before embarking on your next trip, do your homework! Talk to your insurance agent – or call me for a recommendation – and learn more about all the different insurance options available to you, so you can make the best choice for your peace of mind!
Remodeling Your Bathroom: A Project Worth Investing In
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The economy is showing signs of recovery. In fact, just last week, Retail Sales were reported up for the seventh straight month – thanks in large part to the 6.9% gain at hardware stores and garden centers. If you’ve been thinking about spending some money of your own at a hardware store for a project around the house but aren’t sure you can justify spending the money, we’ve got two words for you – bathroom remodel.
The Beauty of a Bathroom – You can live without a theater room or a home office, but any house worth buying must have at least one bathroom. This may seem obvious, but take a minute to think about it. Aside from the kitchen, there is no other room that’s more utilitarian. The bathroom actually has multiple uses, possibly making it the most necessary room in the house.
Return on Investment – In terms of remodeling a home’s bathroom, the returns can be staggering. While many home remodeling projects return only pennies on the dollar in terms of adding value to the home, some studies indicate a national average return of 90% or even more for mid-range bathroom remodels. While the amount of your return will certainly depend on many variables – it is one of the most desirable upgrades in a home, and brings amongst the highest returns.
The Options are Endless – When it comes to the particular upgrades for your bathroom, the options for luxury and function are many. There are two main factors to consider: what specific upgrades will enhance your life, and how much money can you afford to spend? The following are just a few ideas of awesome upgrades that also function as sound investments:
- Make It Bigger. A major trend is to expand the size of the master bathroom. Adding space to this room is a wonderful luxury as well as a potentially huge selling point. An augmented master bath allows you, as well as any potential buyers, the ability to make other additions and upgrades.
- Build for Two. One of the major issues for homeowners with only one bathroom, or couples sharing a master bath, is the inability for two people to use one bathroom simultaneously. If size permits, this problem can be alleviated with upgrades, like a double sink, a separate shower and tub, and a short wall to enclose the toilet area.
- Add a Designer Touch. From tubs and toilets to fixtures and flooring, there is literally no end to the combinations of great looks. These types of improvements are relatively inexpensive in comparison to the dramatic upgrade they give to the look and feel of your bathroom. Walls can be repainted. Old counter tops can be replaced with granite or marble, and vinyl flooring can be upgraded to tile.
- Invest in a Spa Experience. If luxury is what you’re looking for, you may want to think about an oversized tub, either sunken or raised, with Jacuzzi capability. State-of-the-art showerheads can also be installed, giving you options like receiving a water massage or bathing under a rainfall. Tile floors, towel racks, and toilet seats with built-in heating elements can bring added warmth during the colder months. And don’t forget the fog-free mirrors.
When it comes to updating the look and functionality of your bathroom, the sky is the limit. You could invest very little time and money by merely repainting the walls, changing out your fixtures, and doing a little decorating. You could also pull out all the stops and completely remodel an existing bathroom or even add one on.
The bottom line is that a great bathroom is something you will enjoy for as long as you own your home. It may also add to the home’s overall value if and when you decide to sell in the future.
