Many hopeful homeowners may get confused by the terms “modular” and “manufactured” when it comes to property types. And while modular and manufactured homes tend to get used interchangeably, they are actually very different. Technically, both types of homes could be considered “manufactured,” since they are both built in a factory or manufacturing facility, but when it comes to manufactured and modular homes, it’s important to know the difference, especially when talking about financing.

Manufactured Homes

Constructed completely offsite and transported to their location, manufactured homes are also often called mobile homes or trailers. While they can come in a handful of different sizes, the most common are single- or double-wide. They can be located in a trailer community or on owned land, but manufactured homes are not on permanent foundations.

Lower in price, manufactured homes typically do not appreciate in value at the same rate as other types of homes. Because of this, it can be very challenging to find a mortgage lender who will finance the purchase of a manufactured home.

Modular Homes

Also called prefab homes, modular homes can come in a variety of shapes, sizes, styles and price ranges. Unlike manufactured homes, modular homes have comparable pricing to traditional site-built homes, and are similar in appearance, too. Sometimes modular homes can look exactly like site-built homes, due to the advances in modular construction and the wide variety of building styles that are available today.

Although modular homes can look just like traditional single-family homes, they are actually built in segments and then put together at the home site. Unlike manufactured homes, modular homes are constructed on a permanent foundation and are considered permanent structures.

Modular homes can be very cost effective and construction on them can be very efficient. Modular homes have to adhere to all state and federal building codes and must have the same kind of inspections as a regular site-built home. By contrast, manufactured homes only have to adhere to the standards set forth by the Department of Housing and Urban Development (HUD), which tends to have more lenient rules and regulations.

Finding affordable financing for a modular home purchase or refinance isn’t nearly as difficult as it is for manufactured housing, so if you need a mortgage, a modular property is the way to go.

When applying for a home loan, it’s important to keep in mind how much monthly mortgage you can afford. Through the approval process, lenders will factor in your credit score, income and other financial data to determine the maximum loan amount you’re eligible for, and you may qualify for more than you can afford. Consider how much you should borrow to keep your monthly expenses and family budget manageable.

To start that calculation, find an online mortgage calculator. It should show you the total costs of owning a home beyond the principal and interest of a mortgage. Other expenses can include private mortgage insurance, home insurance, property taxes and HOA fees.

Once you have that total number, you can determine if it fits within your monthly budget. If not, then you may have to find a lower-priced house to buy.

28 percent, a good start
The Mortgage Reform and Anti-Predatory Lending Act requires mortgage lenders to determine that borrowers can reasonably repay a loan. The decision is based on an applicant’s credit, job stability and income. The law doesn’t allow mortgages to take up more than 35 percent of monthly income.

Many lenders use more stringent requirements, limiting a payment to 28 percent of monthly income.

How to do the math
Doing the math on how 28 percent of income equates to dollars is easy: Multiply your monthly income by 28, then divide that by 100. That number equals 28 percent of your monthly income.

Here’s an example: The median U.S. household income in September 2014 was $51,939, according to the U.S. Census Bureau. That equals about $4,328 per month in income. Multiply that by 28 to get $121,191, then divide by 100 to get $1,211.

That $1,211 is 28 percent of the median household’s monthly income.

Beware of other debt
Other debt and expenses, however, may make it difficult to afford paying 28 percent of your monthly income toward a mortgage.

Credit card debt, a car loan and student loans will also be looked at by lenders, and if they add up to more than 7 percent of your income you may not qualify for a mortgage that costs 28 percent of your income. Your debt-to-income ratio would be at 35 percent or higher, and a lender may require you to pay off some debts before approving you for a home loan.

Contact me for more insights and info.

For veterans or service members looking to buy a home with a Veterans Affairs loan, there are some extra steps to take and home condition requirements that aren’t needed with other types of loans.

The home must be safe, clean, in good condition and move-in ready, partly because the U.S. Department of Veterans Affairs doesn’t want to back a loan where the military member’s finances are at risk because they have to make unexpected home repairs.

The extra work can be worthwhile. VA loans are 0.25 to 0.50 percent lower than conventional loans, don’t require a down payment or mortgage insurance, and have more flexible and forgiving requirements. Closing costs are limited and lenders fees are limited to 1 percent of the loan amount.

The government guarantees at least a quarter of the loan amount on a VA mortgage, which is why a down payment and mortgage insurance aren’t needed.

For buyers who qualify, here are some things to be aware of when buying a home with a VA loan:

Look for a move-in ready home. Homes that are structurally sound, safe and sanitary are more likely to pass the VA appraisal. The property must have adequate heating, roofing and safety features, and major issues must be repaired before the loan can close. If the VA expert has to return to reinspect something that needs to be fixed, the borrower will have to pay more inspection fees.

Be ready for an inspection. A home inspection is a normal part of buying a house, but a VA inspector will make sure the property is in good, working order. But a lot of the things they’ll be looking at are cosmetic, which a regular lender wouldn’t be concerned with. Though a VA inspection can sound like a professional home inspection, it isn’t and buyers can hire their own inspectors after the VA one if they’d like.

And more inspections. The VA also requires some inspections that other lenders don’t. A VA loan will require a pest inspection, along with a look at the septic tank, if there is one, and the water well if the property isn’t on a city water line.

Quicker timeline. VA loans have tighter timelines than other types of loans, which is why hiring a real estate agent and loan officer who have experience with VA loans can make the process smoother. Active-duty service members can have short buying windows if they’re ordered to move to another base.

In today’s day and age, choosing the right lighting for your space can be an overwhelming proposition. But it doesn’t have to be. Here are three out-of-the-box ideas you can—and should—put into play.

Light unexpected spaces. There’s no need to settle for simple overhead lighting. Up ambiance and interest in a room by lighting a strip along the floor or beneath a kitchen counter. Place rope or strip lights along the edge of your staircase for easy navigation in the dark, or add indirect lighting under or above cabinets in the kitchen.

Light in layers. When planning lighting design for a room, think lighting in three main layers: overhead lighting, task lighting, and accent lighting. Think a chandelier or ceiling fixture to cover overhead, table lamps for task lighting, and a few specialty spots for accent lighting—frame lighting around the bed frame in your bedroom, for example, or light a few of your favorite pieces of art to draw attention to them.

Don’t forget to dim. Considering that dimmer switches run a scant $25, there’s no reason not to have them in your home. Control your space’s mood and ambience for a small cost, and enjoy a slightly smaller utility bill – the American Lighting Association sites that a dimmer switch saves an average of $30 a year.

Interested in real estate and housing tips? Feel free to contact me directly.

Eco-friendly features are all the rage today as homeowners commit to living greener lives. But for those looking to reduce their carbon footprint, where do you begin?

For many, the answer is the kitchen. The central hub of the home, the kitchen offers a perfect foundation for incorporating green features and appliances.

Getting started, you may want to consider adding an induction stove, a stove that utilizes magnetic energy to induce a current that heats the food. Not only do pans heat up quickly on this type of stove, but the amount of time needed to cook meals is greatly reduced. In addition to the energy savings and coolness factor, induction stoves tend to be much safer than traditional stoves since there’s no open flame or hot electric element involved.

It’s also important to add energy-efficient appliances. If you’re trying to sell your home and an old dishwasher and refrigerator unit serve as the focal point of the room, it could be a major deterrent to a sale.

Changing up the lighting is another easy way to up the eco-friendly factor and make the kitchen appear fresh and new. Installing ceiling fans is another simple, inexpensive way toward making the space more eco-friendly. Ceiling fans will circulate warm air in the winter and will help keep the kitchen cool in the summer, keeping heating and cooling costs lower throughout the year.

When it comes to greening your home, remember that you don’t need to drain your bank account to find success. For example, adding a water filter to your sink (and saying goodbye to bottled water) is an inexpensive way to promote green living. Take this one step further by highlighting the fact that the water filter removes harmful contaminants, providing a fresh drink that can easily be enjoyed when relaxing at home or while out and about.

While not every change will yield a payoff, data shows that kitchen improvements will reap the highest rewards in home value, offering the fastest way to get someone interested in buying your home.

Title insurance can be one of those things that someone says you need when you buy a home, but you don’t understand why.

Without it, you could be left with a nagging question in the back of your mind: “Does the seller really own the property?” If the answer is no, it could be bad if you don’t have title insurance.

Some people or companies other than the title owner may have rights to the property. For example, the property owner may have sold mineral, air or utility rights to someone else. Or a bank with a mortgage on the property may own an interest in it. The government can also have a lien on the property for unpaid taxes.

What does title insurance do, exactly? Basically, it covers events related to the title that have already happened. It doesn’t cover future things that happen to the title after it has been issued.

First, the title company or an attorney verifies that the seller owns the property and is free to sell it. The title search includes searching property records to make sure there haven’t been any clerical errors and that there aren’t any undisclosed heirs, spousal claims, omissions in deeds, unknown liens or fraud with the deed. If there are any errors, they’re fixed before the home purchase transaction is completed.

Second, the title company contracts an underwriting company to issue an insurance policy, called title insurance. This protects you in court if anyone challenges you to the title of your home. If you lose any equity, you’ll be compensated.

Two insurance policies will often have to be bought by the homeowner: one protecting them as the owner, and a lender’s policy protecting the lender. The lender requires the insurance because it is providing a loan with the property as security. A problem with the title affects the value of the lender’s security. Only the amount of the loan will be covered in the lender’s policy, and it will decrease as the homeowner pays back the loan.

So you want to add a little feng shui flavor to your home? The following tips can help foster a strong connection between your space and your energy, which can impact the way you feel when you move through your home, and attract positivity in your life.

1. Pay attention to your entryway. Everyone likes to make a grand entrance, right? Pay mind to how you decorate the front hall or front door of your home; it’s the first thing you see when you enter, and sets the tone for how you will feel as you transition into your space.

2. Add plants. Houseplants quite literally breathe life into your space. They foster growth and creativity, and clean your air. Win! Choose something easy to care for, like a fern or a succulent.

3. Balance your bed. To feel more grounded and balanced, make sure to even out each side of your bed. This means have matching nightstands and lamps on each side so the room looks and feels even. It also helps promote equal energy between you and your sleeping partner, should you have one.

4. Center your desk. If you work at home even occasionally, pull your desk away from the wall and face it out into the room, or at a window. Facing a wall can block creative energy. Open your space to let the energy move freely.

5. Create a gallery vibe. If you’re a fan of art or have a large collection of family photos, arrange them gallery-style, not in a straight line. Sharp edges (like those found in a straight line of photos) can be off-putting. Instead, arrange your photos in the floating, visually-appealing style of a gallery wall.

There’s a memorable phrase in the real estate profession of “Disclose, disclose, disclose. Those who don’t, don’t close, don’t close, don’t close.”

It’s a smart rule to follow, and not just to make a sale. The National Association of Realtors® Code of Ethics goes into some detail about what agents should disclose to clients, though there isn’t much about rules for real estate disclosures about a property’s condition.

An agent’s role in conveying the seller’s disclosure is pretty straightforward: Tell everything required by law, which vary by state and can go down to the city and county level.

The one area that federal law requires disclosure of is lead paint. If a home was built before 1978, it may contain lead paint, and a disclosure form must be completed.

The state and federal regulations are meant to disclose known facts about a property’s condition, including problems that could discourage potential buyers. These include leaking windows, being in a flood zone and if a murder happened on the site.

While a home inspection should turn up most issues and could turn up new issues that no one knew about, it’s legally up to the seller to tell buyers about problems they already know about a home.

Most states require real estate agents and brokers to sign a disclosure form listing everything material about the deal, under penalty of perjury.

A real estate agent representing the buyer has a duty to disclose information that would allow the buyer to complete the sale at the lowest price and at the most favorable terms for the buyer, and these can include home defects that need to be fixed.

But some things that come up during an inspection, for example, might not be the seller’s obligation to address or disclose, says Louis Wolfs, an agent in Needham, Mass., in an online forum at Trulia.

Some issues may not meet current building codes but are working fine for the current owner, who isn’t obligated to disclose them, Wolfs says. These can include older windows, railings that are low, a driveway needing repair and improper grading.

Sellers and their agents may not have to disclose such issues, but revealing as much as they can in a disclosure statement is only in their best interest in the long run if they don’t want to be sued afterward for not alerting a buyer to something they knew about.

“Disclose, disclose, disclose.” Follow that mantra and you should be safe.

I hope you found this real estate information helpful. Please contact me for all your real estate needs today!

Often, those looking to purchase an additional home get confused between a second home and an investment property. However, the two are not interchangeable – especially when it comes to their financing.

Second Home, Defined
A second home is real property that the homeowner intends to occupy in addition to their primary residence for part of the year. Usually, second homes are used as vacation homes. Second homes may also be properties that the homeowner visits on a regular basis.

Examples of second homes may include:

• A condo in a city where you frequently conduct business
• A beach house that you and your family occupy during the summer months
• A house in a different state where you have seasonal work

Getting a Mortgage
If you can’t purchase a second home out-right, you’re going to go the traditional route and look into obtaining a mortgage. In order to qualify for a second-home loan, the property is usually required to be located in a resort or vacation area (like the beach or mountains), or be a certain distance from the borrower’s primary residence.

Understanding Interest Rates
Most lenders consider second homes to be more of a risk than primary residences, but not as big a risk as investment properties. Typically, interest rates will show this; second-home mortgages may have lower interest rates than investment property loans, but not necessarily. It can all depend on the borrower’s entire financial picture.

Understanding Rules
Second-home loans often include a second-home rider along with the mortgage. This rider states certain rules the borrower must abide by in order to qualify for the loan.

These rules often include the following:

• The borrower will occupy and use the property as his/her second home
• The property will be kept available for the borrower’s exclusive use and enjoyment at all times
• The property cannot be used as a timeshare or be subject to any rental pool arrangement
• The property cannot be subject to any agreements that require the borrower to rent the property or give a management firm (or anyone else) control over the use and/or occupancy of the property.

Every time a prospective homebuyer walks onto your property, there are a few things that they will absolutely not put up with. These deal breakers can be anywhere in the home, but there is one area that we often forget about: the backyard.

The backyard is very important to family life. After all, this is the place where children will enjoy their childhood and play in a safe and secured environment. Most homebuyers prefer single-family dwellings solely because of the usable outdoor space! Take some time to focus on your backyard. After all, there are ways that you can update your backyard without spending money.

Pool in the Backyard
To many buyers, a pool can be seen as an expensive maintenance fee that they will have to pay for on top of the mortgage. Once they see a pool, they’re going to start doing some calculations in their head thinking, “Now how much is this going to cost me?” Whether it’s above or below ground, a pool can raise a flood of concerns over child safety.

Size of the Plot
The appraisal of your home is typically made in two elements, the plot size and the actual value of the physical home. That said, the size of your yard comes into play so you want to make sure that you spend a generous amount of time prepping your backyard for visitors. Getting rid of clutter and opening up the yard to make your lot feel larger will help you when it comes time to sell.

Pet Products
Hide dishes, play toys, and photos of your pets as this may make the buyer feel like the home is dirty, especially for a homeowner that doesn’t like the idea of having pets inside the house. This will be a deal breaker if the buyer is allergic to cats and/or dogs.

Landscaping
With the price of water rising rapidly and droughts in California, grass isn’t as appealing as it once was. When frugal buyers see grass, they see a sky-high water bill that will eventually lead to a dead yard and a new project to be undertaken. Think about landscaping trends like xeric landscaping, native plants, and artificial turf to make your home more appealing to all home buyers.

Leaving Backyard Photos Out of your Listing
This is a rookie mistake. If you leave out photos of your backyard, homebuyers will think that you have something to hide. If you have a gorgeous yard, why wouldn’t you want to showcase it in your listing? Are you hiding any skeletons in the closet?

Noisy Neighbors
Now this may be seen as something outside of your realm, but it may be worth a knock on the door to let your neighbors know that you will be showing your house at a given time. Rowdy neighbors can be an instant turn off to potential buyers. Make sure your neighbors’ parties are held on a different day than your open house to give buyers a better peace of mind. After all, they will share a fence with these neighbors for an indefinite period of time.

So What Are Homebuyers Looking For?
A survey conducted by the National Association of Home Builders found that new homebuyers are looking for exterior lighting, lots of trees, a deck or patio, and a fenced in yard. Beyond the basics, an outdoor amenity that is rapidly gaining in popularity is the outdoor fireplace/fire pit, outdoor kitchens, and the outdoor living room.

Investing in the backyard can net you some of the highest returns. Knowing what real estate appraisers (and homebuyers) are looking for will help you sell your property faster. That said, the exterior of your home is just as important as the interior of your home. Many people assume that the front and backyard aren’t crucial to the buying process so they overlook these pitfalls. Make sure that your backyard does not have any hidden deal breakers that could steer away new bids!

According to a recent HomeAdvisor research report, Americans spent on average $564-$2,260 to install a home automation system, with prices ranging as high as $15,000 to install a hard-wired system. While outfitting your home with a full suite of smart home technology can be pricey and intimidating, there are some smaller ways you can start to incorporate this all-the-rage trend into your abode.

Smart home automation deals with syncing household devices and systems with schedules or responsive sensors, says HomeAdvisor, which means that smart home technology is dependent upon smartphone apps and wireless internet routers. The goal is to save on costs, and add convenience and security throughout your home.

A good place to start is with your thermostat. A variety of smart thermostats are available, allowing you to automate and control your home’s temperature from your smartphone. Some, like Nest, learn your habits throughout the day and set the temperature accordingly.

You might also want to consider a smart television. An evolution of the Roku and Apple TV external devices, smart televisions have integrated everything you could ever want right into your set – Netflix, Hulu, YouTube, HBO Go, Pandora, network TV, gaming and much more.

Another great feature to consider is smart shades or blinds. These programmable, remote-controlled window coverings allow you to schedule open-and-close times in conjunction with the room’s exposure, putting you in control of energy saving and setting the mood.

Speaking of setting the mood, a whole host of smart light dimmers give you the option to control the lights in your home from your smartphone. This is an especially useful security feature while you’re away from your home for extended periods of time.

Another great security option is smart smoke and carbon monoxide detectors—this technology alerts you to not only what the problem is but within which part of your home it’s happening.

While the smart home technology options are endless and fascinating, keep in mind that they are internet dependent, so if your home goes offline, so will your devices.

Like this update? As your local real estate professional, I can provide more great tips like this and answer any real estate information questions you may have. Contact me today!

Whether you’re scoping out a vacation property or looking into becoming a homeowner for the first time, applying for a mortgage is a lengthy and complicated process. While your real estate agent and lender will be there to walk you through the details, knowing what possible errors could lay in waiting will help you make the best decision. Let’s review some of the most common mortgage mistakes so you can avoid making them.

1. Weak credit history
Loans are all about credit history – it’s hard to land a mortgage without one. But having a credit history doesn’t mean you have a lot of credit; it simply means you have been given credit in some form and have a documented history of repaying it. How much credit? Lenders often like to see at least three lines of credit with a minimum two-year history on each.

And of course, you don’t just need a credit history; you need a good one. Pay down credit cards and loans regularly to heighten your score.

Pro tip: Paid off that credit card? Don’t cancel the account. Keeping the account active, even if it’s unused, helps build a strong credit history.

2. Weak work history
You’re less likely to get a loan if you can’t prove you’re able to hold down a job. And even if you do get approved with a weak work history, you may not be able to qualify for a good interest rate. What is a strong work history? Aim for at least two current, consecutive years of employment in the same occupation.

Of course, certain circumstances may provide an exception to this rule. If you are a recent graduate with proof of future income, or someone who is coming back out of retirement, some lenders may not hold a lack of recent employment history against you.

3. Opening new credit accounts
Maybe you got a big raise and are applying for a mortgage and leasing a brand new car all in the same month – bad idea. If you’re thinking of applying for a loan, avoid opening brand spanking new credit lines. Lenders like to see solid, stable credit histories, and a brand new line of credit can’t offer that. Unfortunately, some people make this mistake thinking that it will help their credit score, when in truth it can hinder it.

4. Making big purchases
Slow down there, big spender. Just like lenders want to see stable credit history and employment, they want to see stable spending. If you make large charges to your existing credit accounts around the time you’re shopping for a mortgage, you can increase your debt-to-income ratio. So hold off on that new furniture set or big screen TV until after you’ve purchased your home.

5. Not reviewing your credit report
When is the last time you checked your credit? Often, credit reports have errors, and you want to right these before it’s time to apply for your mortgage.

6. Not knowing what you can afford
These days, it’s very easy to figure out how much home you can afford. Simply find a mortgage calculator online, take a look at how much you can pay each month, and plug in the numbers. This will give you a solid idea of how much house you can afford, which can help you avoid disappointment down the road. It’s also important to get pre-approved for a loan before you begin your home search. There have been many instances where a home sale falls through because the buyers made an offer that they couldn’t back up with a mortgage. By showing that pre-approval letter, the buyers are showing the sellers they can afford to make good on their offer, and may also be in a better position to negotiate. And these days, many real estate professionals won’t work with a buyer who isn’t pre-approved.