Posted in Flood insurance

Reasons to Keep Your Flood Insurance

June 1 marks the official start of hurricane season. Yet as we near the second anniversary of Hurricane Harvey—which inundated an area the size of New Jersey with floodwaters—there’s been an uptick in flood insurance policies lapsing, according to the Texas Department of Insurance (TDI).


There was a 29% increase in federal flood insurance policies in the counties affected by Harvey, according to the TDI. Now, the attrition has started, with many of those counties starting to register decreases in policies.

Most home and renters’ insurance policies don’t cover flooding, and the TDI warns that more consumers may be at risk for flooding than are aware. The Houston Chronicle found that almost three-quarters of the homes and apartment buildings damaged by Harvey in Harris County were outside the 100-year floodplain, which is the area where flood insurance is mandated.

Consumers can find more information about flood insurance at Homeowners with a property outside a high-risk area may be able to purchase a policy for as low as $500 per year, according to the TDI. Renters can purchase contents-only policies to cover their belongings.

Most flood insurance policies have a 30-day waiting period, so the time is now to talk to clients about flooding and whether they have coverage—and it’s current.

Posted in Mortgage & Finance

Can I Refinance While Buying a Second Home?’ Here Are the Mortgage Rules

As a buyer and a seller, you may be asking, “Can I refinance while buying a second home?” Maybe you’ve found a property that will be a killer investment at a bargain price. Or perhaps the beach cottage you’ve had your eye on for years just came on the market.

Whatever the reason, if you’re considering applying for another loan while refinancing your current home, the process can be a bit complicated. To give you the full picture, we consulted mortgage experts and broke down the rules.

‘Can I refinance an existing mortgage while buying a second home?’

There’s nothing wrong with refinancing one mortgage at the same time that you are buying an investment property or second home with a mortgage, according to Andrew Weinberg, principal and licensed mortgage broker at Silver Fin Capital Group, in Great Neck, NY.

The key factor in making both the refinance and new purchase work is to ensure you will qualify for the new home loan.

“This means taking into account your current home payment,” says Ralph DiBugnara, president of New York’s Home Qualified and vice president at Cardinal Financial. A mortgage bank can very easily tell you the total payments and loan amounts you’ll be able to carry based on your current income.

In some cases, you may even have to refinance to reduce your current mortgage payment to qualify for the new loan. Or you may need to cash out funds from the refinance to come up with the down payment on the new property.

The only ironclad rule is that you can’t refinance a primary residence while applying for a mortgage on a new primary residence.

Consider working with one lender for both mortgages

The benefit of doing both loans—refinancing and obtaining a new mortgage—is that you can deal with a single loan officer and provide most of your documents (e.g., tax returns, W-2s, pay stubs, bank statements, etc.) only once.

You can also optimize your loan balances and your monthly payment to a degree by doing both loans with the same lender, says DiBugnara.

If you need to work with two different lenders, both need to be aware of the other loan.

When refinancing and buying at the same time isn’t a good idea

You shouldn’t refinance a home you intend to sell in the next six months or so because it’s not cost-efficient.

“The closing costs don’t vary because you intend to pay off your loan in a short period of time,” says Weinberg.

Additionally, most refinances have a clause stating the borrower must stay in the home for at least one year. This means you cannot refinance a primary residence, close on a second home, and then immediately move into it permanently.

The differences between investment and second home

When applying for your second mortgage, your lender will take into account how you plan on using the property. So it makes a difference if the second home is for investment purposes or is a vacation home for personal use.

“If the home is an investment, you can use proposed rental income as an add-on to your second income when qualifying for the second mortgage,” says DiBugnara.

But if you’re purchasing a vacation home, the new debt will count 100% against your current income and could prevent you from qualifying for a refinance and a second mortgage.

The good news for those looking to buy a beach cottage or winter retreat? Vacation home mortgage rates are typically lower than investment home rates.

“You can also typically put less money down—sometimes just 10%,” says Kylie Pak, owner of RedBrick Properties, in Richmond, VA, who specializes in property investing.

For more smart financial news and advice, head over to MarketWatch.


Posted in Home Maintenance

4 Outdoor Updates That Add Value to Your Home

Selling your home? The experts at Better Homes & Gardens Real Estate say these projects make the best outdoor investments.

The smallest details of a home’s upkeep can make all the difference to a potential home buyer. Make these small updates to make a good impression without having to do a complete exterior overhaul. Most of these updates are quick and affordable so you can get them done in a weekend.

1. Keep Landscaping Simple

Most buyers want low-maintenance plantings. Putting down mulch or groundcover also makes for easy upkeep. If you want to go with something temporary, put colorful annuals in pots. Add mulch, pull weeds, and trim hedges around the yard for a clean and effortless look.

Easy Landscaping Ideas

2. Fix Damaged Siding

Residing can be a long and often pricey process. Show buyers that your siding is in good shape by repairing any cracks, missing pieces, and surface chips. For a fresh look without painting, consider a professional pressure wash. If the exterior is brick, fix thinning areas of mortar.

3. Dress Up Your Front Door

A new coat of paint in a color other than white or black makes it memorable for potential buyers. Go with a color that stands out, but also complements the style of the home. Replace the handle if it’s tarnished or looks dated. Spray paint the handle if it just needs a quick update. Accessories like door numbers and knockers give a welcoming feeling, so play up the hardware.

Best Colors for Front Doors

4. Repair Windows

Even a little damage on one window gives the impression that there could be more problems. A few quick fixes will reassure buyers that the windows are nothing to worry about. Fix caulking around frames and glazing on panes for a like-new look. Replace cracked or foggy windows to make the best impression. If there are built-in window boxes, repair them and give them a fresh coat of paint. Then fill with pretty annuals.
Source: better homes & gardens.