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March Real Estate News

 

Happy St. Patrick’s Day!

Renting Out Your Home? Get Landlord Insurance

If you’re renting out your home, it might not be covered by homeowners insurance, so look into landlord insurance instead.

 

Maybe you’re moving up to a bigger home and holding on to your former residence as a rental property. Or maybe you’ve tried to sell your home without success. Whatever the reason, if you’re thinking about renting out your home, you need to look into landlord insurance.

 

Homeowners insurance covers your house if it burns down, your possessions if there’s a break-in, and medical and legal bills if someone gets hurt on your property. Problem is, homeowners insurance might not offer protection if you decide to rent out your home. Landlord insurance does. Set aside half a day to research policies.

 

Renting out your home raises risks

Homeowners insurance typically covers owner-occupied, single-family residences, says John W. Saunders, president of Slemp Brant Saunders, an independent insurance brokerage in Marion, Va. When your home doesn’t meet that definition because it’s being rented out regularly, it’s no longer covered.

 

Most homeowners policies will cover an occasional short-term rental if, say, you’re going away for a few weeks, says Dave Millar, a partner at Riley Insurance Agency in Brunswick, Me. “But if you have a summer home you’ve decided to use as an income property and are putting different people in there every week,” he explains, “that’s a lot higher risk for the insurance company.”

 

The risk is also higher for both you and your insurer when you rent out your home on a full-time basis. You have an increased responsibility for injuries on the property, whether to your tenants or your tenants’ guests, says Bob O’Brien, vice president of Noyes Hall & Allen Insurance in South Portland, Me.

 

Insurers also experience more claims on tenant-occupied properties because tenants typically don’t care for properties as well as owners would. Renters are less likely to either identify or report maintenance needs, says O’Brien, and may be unfamiliar with a home’s systems like the location of the water shut-off.

 

Read more: http://www.houselogic.com/articles/renting-out-your-home-get-landlord-insurance/#ixzz1Gq5B9M00

Cathy’s Mortgage Corner

 

 

As predicted last month, we are beginning to see interest rates rise.  We have gone from 4.75% to 5.125% for a 30 year fixed rate in the past 30 days.  So, now we are beginning to see more interest in the Adjustable Rate Mortgages again.  The very good news is that today’s ARMs are capped both by how much they can adjust once the fixed rate period has expired and annually thereafter.

 

Most ARMs are capped at 5% over where they begin with annual caps at 1%.  What that means is that there should not be a “payment shock” when payments begin to change both at the end of the fixed rate period and annually thereafter.   Here is an example:  at the time of this writing, the average FHA and Conventional ARM rate is at 3.75%.  Using an average loan amount of $250,000.00; you would see monthly principal and interest payments of $1157.79 using a 5-1 ARM product versus $1361.22 using the 30 year fixed rate product.  The interest savings over the first five years is $12,205.65. 

 

Taking this payment adjustment one step further; after the fixed rate period ends, your loan can adjust up or down no more than 1% on an FHA loan (2% on a conventional loan) over/under the start rate.  At the end of the first five years, your principal balance will be $225,193.29 (on both the FHA or conventional loan).  If we assume your loan increased the maximum amount of 1%, (FHA) in that 6th year your new principal and interest payment would be $1283.87 (or $126.08 increase per month) which is still a savings of $77.35 per month over where you would have started with the fixed rate at 5.125%. If your loan is a conventional loan, (again assuming the maximum increase of 2%) your 6th year principal and interest payment would be $1416.71 or a slight increase of $55.49 per month.   Adjustable rate mortgages don’t always go up, 3 out of the last 7 adjustments have actually been downward adjustments.

 

My point being, with today’s adjustable rate mortgages, the potential increases (both in 5 years and annually thereafter) are not so high as to not be affordable to the average consumer (assuming you have some kind of raise in income during the first five years and beyond).  The savings in the first few years is substantial so it is definitely worth exploring.  The average loan is out about 7 years, before the borrower either moves or refinances that loan.   Some of the questions you need to ask yourself are; how long do you intend to keep this mortgage, how long do you intend to live in this home, is this your first home or one you intend to live in for many years.

 

The best way to see if an adjustable rate mortgage is for you is to sit down with a trusted mortgage professional and go through the numbers.  ARMs are not for every consumer, but they are for many.  You will discover in your discussions whether an ARM best fits your particular needs.  Please feel free to call me anytime and we can discover together the best fit for you whether it is an ARM or a fixed rate!

 

Next Month:  VA loans


 

Cathy Bok

Guild Mortgage Company

Direct Phone # 720-746-4097

Cell Phone # 303-757-4121

Efax # 720-367-5488

Email: cbok@guildmortgage.net

www.guildmortgage.net/cathybok

NMLS # 374094

 

 

In this issue:

Happy St. Patrick’s Day!

Renting Out Your Home? Get Landlord Insurance

Cathy’s Mortgage Corner

Top 5 Tax Filing Errors – Audio Clip

Your Realtor,
Steve Charlett

See Our Rentals

Is Your Home Ready for the Spring Buying Season?

Top 5 Tax Filing Errors – Audio Clip

Click this link to hear a radio clip of House Logic professionals discussing the top 5 tax filing errors before you file!

Your Realtor,

Steve Charlett

 

Contact me to get a home buying consultation, and/or a complimentary market analysis on your home!  

 

Cell # (720) 308-6835

Office # (720) 870-5321

 

Steve@DrRelocation.com

www.DrRelocation.com

 

Doctor Relocation, LLC

13770 E Rice Place

Aurora, Co 80015

 

“When You Think of Someone Who Needs to Buy, Sell or Rent a Home

,,, Please Think of Me”

 

 

 


See Our Rentals

 Remodled Home by Heather Ridge Golf Course

 

 

 

Just rented! Our rentals are moving quickly and the homes below were filled just last month:

 

The Landing at Cherry Creek

 

 

Large Home in South Aurora Centennial

 

 


Is Your Home Ready for the Spring Buying Season?

It’s time to get [your property for sale] ready for the spring! A recent article in U.S. News & World Report by Luke Mullins, 10 Cheap Ways to Boost Your Home’s Sales Price by Spring, offers up some affordable ideas for getting a property in selling-ready shape in time for the spring sale season. Among the ideas in the article:

 

1.)  Touch up the paint on the front door—it’s one of the first places buyers will look!

 

2.) Paint the interior a light yellow or cream color that creates a nice constrast with white woodwork.

 

3.) Update the light fixtures, particularly in the entrance and the foyer.

 

4.) Buy a stove to jazz up your kitchen. There’s no need for an expensive kitchen remodeling job: An updated kitchen stove for about $700-$800 may be enough.

 

5.) Remove mildew from the caulking and replace stained sinks in the bathrooms.

 

By Melissa Dittmann Tracey, REALTOR® Magazine

Doctor Relocation, LLC. • 13770 E. Rice Pl. • Aurora, CO 80015

http://www.drrelocation.com

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