Inexpensive Ways to Boost Your Home’s Value

Inexpensive Ways to Boost Your Home’s Value

Although mortgage rates are still at an all-time low, there are lots of homes on the market for potential buyers to choose. This makes competition tougher for sellers. If you are in the market to sell a property, it might be wise to take some time and spend a few dollars on simple things that will yield great results.

Choose the Right Agent

Sometimes the most important thing for a home seller is the most overlooked. Get a real estate agent that is good for you. There are numerous agents available, all with various personalities, strengths and weaknesses. Here are some tips for finding an agent that you are comfortable with and can help move your property.

* Visit a few open houses: This will give you a chance to see the agent interact with other interested buyers. You can gauge their professionalism, demeanor and overall knowledge of the market.

* Ask your friends and family members for a referral: This can be an easy way to find a Realtor®, but use a bit of caution. An agent that has lots of experience selling country homes with acreage may not be the best choice to sell your suburban 3 bedroom home. Make sure to check out their other sold listings and see how many are comparable to your place.

* Do an online search: Check out agents online. Look for their website and do a little research. Is their site professional looking? Is it updated with current listings? How well do they explain the homes they are trying to sell now? Are there lots of pictures? Once you have found someone you like, give them a call and do a brief interview over the phone.

Paint

One of the quickest and cheapest ways to alter a room's appearance is by simply adding a fresh coat of paint. Most any able bodied person can work a roller and a brush. Choose a color that is a bit neutral but also bright so that it will make the room livelier.

Clean up and Streamline

Obviously, you want the home as clean as possible. Take extra care to clean the bathrooms and kitchen. Also spend some time organizing and getting rid of clutter. Remove any excess wall hangings. This will make the room feel more open and larger. Making a home inviting and spacious will attract more buyers.

Improve the Curb Appeal

Like painting, this will likely involve more sweat than money. If you have shrubs make sure they are trimmed and neat. Give the lawn a fresh cut. Put a new welcome pad by the front door. Also, include some type of attractive plant near the front door. Since this area will likely be prominent in pictures that are trying to sell the home you want it to look inviting.

Bridging Outdoor Areas with Inside Areas

Use decorative plants around the patio and deck as well as inside the home. Use comfortable furniture outside that has soft cushions. This makes the home feel bigger with more usable space outside that can be used in a number of situations.

Which Mortgage? FHA 203K or HomePath Loan

Short sales and bank owned properties can offer a great price point to the savvy buyer or investor. Typically though, these homes do require some amount of work and repairs. I've found that many properties just need some cosmetic ‘touch ups' like paint and landscaping. Others however may need significant remodeling, including drywall, roofing or windows.

In any event, having a mortgage available that gives you the option of financing these repairs is a huge advantage. The two most common options currently in the market are the FHA 203K and the HomePath loans. The Zillow article below goes over the differences in each.

Regards
Michael Collins, SFR
Short Sale & Foreclosure Resource

If you are in the market to buy a home, chances are that you have seen at least one property that is either a short sale or a bank-owned property.

And based on what I have seen, many short sales or properties that are currently owned by the bank are in need of a few repairs before anyone can live in them.

Which is why I get quite a few questions about two of the most popular loan programs designed to help homeowners finance needed repairs on a new home: the FHA 203k program and Fannie Mae's HomePath mortgage program.

One of the more common quick questions I hear when people are learning about these loan programs is:

"Which is better, the HomePath mortgage or the FHA 203k loan?"

The simple answer to this question is "it depends" and before I give you a simple formula that might help you choose between the two programs, here is a quick review of each loan program.

The FHA 203k and FHA Streamline 203k Loans

The FHA 203k loan program can be grouped into two different types of loans: the FHA Streamline 203k loan program and the FHA 203k loan. The FHA 203k streamline is designed to be a limited repair program and has simpler processes and no HUD consultant required like on the full FHA 203k loan. In my experience, the FHA 203k streamline is a more popular option since many of the needed repairs for bank-owned homes can be considered "cosmetic."

Highlights of the FHA 203k streamline loan include:

• It works very similar to a construction loan - it allows you to purchase a home that wouldn't qualify for FHA financing due to repair work being needed



• The loan amount is equal to the purchase price of the home plus the amount needed for repairs



• FHA 203k streamline program allows for repairs ranging from $5,000 and $35,000



• Qualifying for FHA 203k loans are the same as regular FHA loans



• Repair work cannot begin until loan closes and the money to pay contractors comes from an escrow account set up when the loan closed



• FHA 203k loans require UFMIP and MIP just like regular FHA loans



• Appraisal required



• Currently available for owner-occupied properties only although I have heard rumors of an "Investor 203k loan" coming soon.

Fannie Mae HomePath Renovation Loan

When the housing downturn began and Fannie Mae started owning more homes than ever before, one of the things Fannie Mae did to help move the homes to new owners was to design the HomePath mortgage program.

The HomePath mortgage program has two different programs within it - the HomePath loan and the HomePath Renovation loan.

For homes that are in need of repairs, the HomePath Renovation loan is the loan program that is often compared to the FHA 203k loan when weighing options.

HomePath Renovation loan highlights include:

• The property must be currently owned by Fannie Mae



• The loan amount is for both the home and the repairs required for the home



• Repairs can be up to 35% of the as-completed value, but not to exceed $35,000.



• Down payment requirements can be as low as 3%



• Fixed or adjustable rates are available



• No mortgage insurance required



• Investment properties or 2nd homes and investment properties are allowed



• No appraisal required



• Lenders can be difficult to find, not every lender is HomePath approved and many HomePath approved lenders do not offer the HomePath Renovation loans

HomePath Renovation Loan or FHA 203k Loan?

When deciding on financing for a home that is in need of repairs, the Fannie Mae HomePath Renovation loan program and the FHA 203k loan program are what most people are going to select.

Is there an easy way to select the "right" loan between the two?

Yes.

Which Loan Program Is Better?

Here is a simple way to choose the right loan program between the two if you are buying the home as your primary residence:

• Is the home owned by Fannie Mae?If yes, it probably makes the most sense to get a HomePath Renovation loan.



• Is the home owned by someone other than Fannie Mae? If so, then your best option is the FHA 203k loan.

While both the FHA 203k loan and the Fannie Mae HomePath Renovation loan programs are similar, I have found that for houses owned by Fannie Mae it usually makes more sense to go with the HomePath Renovation loan.

Which means the first question you may want to ask is:

Is this house owned by Fannie Mae?

And then you will have your answer.

> Use Fannie Mae Loan Lookup tool

Justin McHood works for Academy Mortgage and is based in Chandler, AZ. He is a contributor to Zillow Blog and has conversations about mortgages whenever he can. Learn more about Justin at http://www.mortgagecommentator.com/.