Rising Prices Help You Build Your Family’s Wealth

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Over the next five years, home prices are expected to appreciate, on average, by 3.6% per year and to grow by 18.2% cumulatively, according to Pulsenomics’ most recent Home Price Expectation Survey.

So, what does this mean for homeowners and their equity position?

As an example, let’s assume a young couple purchased and closed on a $250,000 home this January. If we only look at the projected increase in the price of that home, how much equity will they earn over the next 5 years?

Rising Prices Help You Build Your Family’s Wealth | MyKCM

Since the experts predict that home prices will increase by 5.0% in 2018, the young homeowners will have gained $12,500 in equity in just one year.

Over a five-year period, their equity will increase by over $48,000! This figure does not even take into account their monthly principal mortgage payments. In many cases, home equity is one of the largest portions of a family’s overall net worth.

Bottom Line

Not only is homeownership something to be proud of, but it also offers you and your family the ability to build equity you can borrow against in the future. If you are ready and willing to buy, find out if you are able to today!

Top 10 Most Expensive Mistakes You’re Making on Your Home

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Homes cost a lot of money to maintain. But are you spending extra money unnecessarily on upkeep? Here are 10 of the most expensive mistakes you could be making in your home.

1. Using Traditional Light bulbs

If you still have incandescent light bulbs in your home, you could be throwing a lot of money away every month on inflated electric bills. Over its life span, an incandescent bulb can use $180 worth of electricity. A CFL will only use $41 worth of electricity over the same time period. Even better is the LED bulb, which only uses $30 per bulb. Think what replacing every light bulb in your home could do to your home’s bottom line.

2. Ignoring a Leaky Faucet

A leaky faucet that drips one drop per second can waste more than 3,000 gallons per year, which is enough water to take more than 180 showers. Some of us live in areas where water is plentiful, but for those of us in areas plagued with drought, this could be costing you a fortune. Fix or replace your leaky faucet and save a ton on your water bill.

3. Using the Wrong Air Filter Size

We all sometimes forget to change out the air filters for our HVAC systems or accidentally buy the wrong size. But using the wrong filter or a dirty filter can increase your power bill and cause expensive problems for your HVAC down the road. Use the correct filters for your system, and set a reminder to change them after the recommended amount of time. You won’t regret it.

4. Not Customizing Temperature

Invest in a customizable thermostat. If you’re away at the office all day, you can program your HVAC to shift a few degrees while you’re gone and then shift back shortly before you return home. Heating or cooling an empty home wastes a lot of money in energy costs.

5. Not Adjusting Air Vents Properly

Is one room in your home hot, while the others are cold? Oftentimes homeowners will crank up the air conditioning in the whole house to combat hot temperatures in one area. Instead, adjust air vents to direct the flow of air more evenly throughout your entire home. Professionals will come regulate this to ensure that your entire home is receiving the same amount of air conditioning or heating.

6.Over Watering Lawn

Many homeowners have their sprinkler systems programmed to come on in the early morning hours for optimum lawn health. This can become a problem, however, if you’re never around to see what you’re actually watering. A broken sprinkler head could be causing a fountain, or the trajectory of your sprinkler may be directed at a fence instead of your lawn. Periodically run your sprinklers during the day so you can see how they are performing when you’re not around.

7. Water Heater Temperature Set Too High

Unless you have a tankless water heater, your water heater is keeping the water in its tank hot 24/7. If you don’t keep an eye on the temperature as each season changes, you may be paying too much to heat your water. Decrease the temperature in the summer, and bump it back up when winter comes.

8. Leaky Windows and Doors

Leaky windows and doors are great places for cold, winter winds to enter your home. Many homeowners simply ignore them and crank up their heaters. Caulk leaky windows and put rubber seal around doors to keep winter winds out and warmth in.

9. Paying a Handyman

Don’t pay a handyman for a job that is simple enough to do yourself. If you’re unsure of how to do something, look up video tutorials online. Doing simple tasks yourself can save you a lot of money.

10. Ignoring Curled Shingles

It may be easy to ignore problems on your roof, but it will only lead to bigger problems later. If you see any possible issues with your roof, repair them as soon as possible, as this will save you significant costs later.

Use these 10 tips to cut maintenance costs on your home today.

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Love makes a house a home.

Boomerang Buyers: Most Qualify for Financing in 2-3 Years

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According to a new study from Lending Tree, Americans who have filed for bankruptcy may be able to rebuild enough credit to qualify for a home loan in as little as 2-3 years.

This is in stark contrast to the belief that many have that they need to wait 7-10 years for their bankruptcies to clear from their credit reports before attempting to apply for either a mortgage or a personal or auto loan.

The study analyzed over one million loan applications for mortgages, personal, and auto loans and compared borrowers who had a bankruptcy on their credit report vs. those who did not to find out the “Cost of Bankruptcy.”

The study found that 43.2% of Americans who filed bankruptcy were able to repair their credit back to a 640 FICO® Score in less than a year. The percentage of those who achieved a 640 FICO® Score increased to nearly 75% after 5 years. The full breakdown of the findings was used to create the chart below.

Boomerang Buyers: Most Qualify for Financing in 2-3 Years | MyKCM

Americans who were able to repair their credit scores to a range of 720-739 within three years of filing were able to obtain the same financing options as those who had never filed bankruptcy.

According to Ellie Mae’s latest Origination Insights Report, 53.5% of those who were approved for a home loan had FICO® Scores between 600-749 last month. This is great news for Americans who are looking to re-enter the housing market.

Boomerang Buyers: Most Qualify for Financing in 2-3 Years | MyKCM

Raj Patel, Lending Tree’s Director of Credit Restoration & Debt-Related Services had this to say:

“People may think that filing a bankruptcy would put you out of the loan market for seven to ten years, but this study shows that it is possible to rebuild your credit to a good credit quality.”

“LendingTree’s research found that very few bankruptcy filers have a harder time [obtaining a mortgage] than those who have not filed for bankruptcy.”

Bottom Line

If you are one of the millions of Americans who has filed for bankruptcy and think that you have to wait 7-10 years to make your dream of returning to homeownership a reality, let’s get together to find out if you qualify now.