Last winter, we replaced our 550 gallon in-ground oil tank with a 275 gallon above-ground tank.  As a result, the oil truck cometh twice as often as it used to, to fill up the tank.  We are on automatic delivery and while we never paid much attention to it before, it is now obvious that we should be paying attention to what we are paying for heating oil. When I saw the oil truck backing down the driveway, my first though was, “Man, it seems like he was just here! We just paid an oil bill about a month ago! We can’t need oil again already!” I ran downstairs to check the gauge and it read ½ full.

We asked the delivery man what oil was going for that day and he said $3.94.9. Wow, that seemed really high – I know heating oil and what we pay at the pump for gas are related, and I know gas started to go up again as soon as the holidays were over, but I’ve always had a problem understanding why a rise in the cost of a barrel of oil today (or an orange crop for that matter!) affects the price of the product which is already in inventory. Anyway, I decided to ask the delivery man to hold off so I could call our oil supplier of 16+ years and find out if they were able to offer a better rate.

I explained to the customer service rep that we still had ½ tank of oil in the tank and asked if the company wanted to offer a better price or if I should just call around myself. She put me on hold for about 45 seconds and came back on and said, “the best we can do today is $3.69.9 a gallon”. That’s a whopping twenty-five cents a gallon! I thanked her, took her name and told the delivery guy he could go ahead and fill us up. While it was great to call and get this discount, I was a little disappointed that this company we’ve used for almost 17 years doesn’t automatically give its loyal customers the best price they can.

Lesson learned. From now on, we will call the oil company, get the scheduled delivery date and then call around and shop rates to get the best possible price. If they don’t put any weight into loyal customers who pay their bills, why should I give them an automatic pass to overcharge us?! The few people I’ve spoken to tell me I am crazy not to shop around – they do every month and it saves hundreds of dollars every winter!

The company probably wouldn’t want us to know either that the delivery guy told us to also tell the company that asking for the “economy oil,” will also save additional money. He said the only difference is that the oil is delivered in an unmarked oil truck. Huh?

Happy January… only 64 days until Spring!!

Posted by:  Kim Simms

Wow, that's a loaded question! When pertaining to real estate, the answer to that question can be quite different, whether it's coming from a buyers, sellers, appraisers or real estate agents. This topic was the subject of a recent article in the Poughkeepsie Journal. 
 
Having worked with numerous buyers and sellers of Hudson River view properties, I have recently asked this question of several appraisers as well as seasoned real estate agents. No one has a hard and fast answer, no magic formula. Do you tack on a per centage over and above what the house without the view would sell for? Or is it just a figure of, say, $20,000, $50,000, $100,000 or more? I admittedly find it a little difficult to be objective about this subject, as I live with a river view which I absolutely love and put a high value on. 
 
In studying this topic, I have learned there are areas of the country where people value a view more, where there are more people who are "view crazy." Those areas will command more of a premium for properties with water or mountain views. For example, I remember reading an article about condos in Seattle where units with (quite minimal) water views sold for 40% more than those condos without a view. Here in the Hudson Valley, I have seen condos with minimal water views sell for no more than a similar condo without any view. Dramatic water views here in the Hudson Valley do warrant considerably higher prices.

There are many variables when it comes to views...fullness of view, obstructions, which rooms have a view, are the views from the main floor or just from the second floor, proximity to water, a property's scarcity. Just how spectacular is the view? What will the price difference be on a house directly on the river as opposed to the same house directly across the street with minimal river views? I had a house listed which had an absolutely gorgeous river view...except for the working quarry directly across the river -- which unfortunately was a deal-killer for most buyers. After a long time on the market, we did find a buyer to whom the quarry was a non-issue.

If a developer is selling homes in a subdivision where some of the new homes have views and others don't, I would say it's pretty easy to put a premium on the homes with the views. But in an area where resales are involved and there are many other variables...style, condition, upgrades, location, etc....that definitely creates more of a challenge. So the trick to selling these properties is to determine the least a seller will accept and the most a buyer will pay. (Is that really any different than any other property?) Once both parties have agreed to that, if a mortgage is being applied for, the bank's appraisal will be the next challenge. The appraiser will try to find comparable sales -- which can be a real challenge, especially in a market where there aren't many recent sales. If he or she can't find comps, then it may come to pricing the house without the view and adding the "value of the view"....which brings us back to the original question...."What's the value of a river view?"

If you have experience with this which you'd like to share, or simply would like to make a comment or have a question, e-mail me at

Dianne Minogue specializes in Hudson River view properties. Visit her website at www.hudsonriverviewhomes.com 

Posted by:  Dianne Minogue

I cannot let January go by and another year fly by without documenting some of my personal favorite highlights of 2011, starting with my favorite act of kindness and service.

I am honored to be affiliated with like-minded professionals under the umbrella of an organization whose commitment to community is one of its four core values. Houlihan Lawrence defines community as, “Caring for and contributing to the welfare of each other and our communities.”

I was grateful to have played a small part in the annual holiday food drive our East Fishkill office held for 11 families in need through Van Wyck Junior High in the Wappinger Central School District. The caring, generous souls in our organization, led by Suzanne (Martha Stewart) DeCosta, provided each family with: a 20 pound turkey, a spiral ham, 5 pound bag of potatoes, 2 pounds of carrots, 3 pounds of onions, canned peas, canned corn, gravy, pineapples, 1 pound of chopped meat, jar sauce, pasta, dinner rolls, 18 eggs, bacon, 1 box of cereal, bagels, bread, english muffins, cream cheese, butter, 1/2 gallon of orange juice, a gallon milk, 1/2 gallon of cran-grape, 2 liter bottle of soda, stuffing, cookie mix, brownie mix, and a big box of Cream Puffs!

We live in the same communities that we work so hard to serve. I am a proud member of this organization and endeavor to remember this feeling when I start the campaign to bring together people in need with people who want to help. It’s one of my 2012 goals. I come across people every single day who want to help but aren’t sure where to turn and I also come across people who can use a hand but don’t know where to go. It’s possible and necessary. My plan is taking shape…

Kim Simms is a full-time licensed real estate salesperson and residential real estate consultant with Houlihan Lawrence Real Estate of East Fishkill, NY. She can be reached at .

Posted by:  Kim Simms

So far this winter it has only snowed once – and that was waaaay back in October before winter even officially started! Good winter weather means it’s easier to get out and enjoy some of the events and things going on in the area. There are so many things to do year round in the Hudson Valley, here is a very small sampling of January (2012) activities, including contact information and website links:

• This Friday and Saturday night, comedic actor Steve Kramer performs at the Bananas Comedy Club in Poughkeepsie, New York.  You may recognize Steve from Spike TV’s “Hype." Bananas is conveniently located in the Clarion Hotel-make an evening or night of it by adding the dinner and or overnight package. Call 845-462-3333 for reservations. I heard he is hilarious!
  
  
  
• Monday is Martin Luther King holiday and there is no school. Scenic Hudson offers a “School’s Out Winter Fun Day” from 12-4 at Long Dock Park in Beacon. Their website encourages us to visit for an educational free and fun expernience with birds of prey courtesy of Bill Streeter, the director of the Delaware Valley Raptor Center.  For more information call 845-473-4440. If I didn’t have to work, I would definitely go!
• Rock and Roll Hall of Famer and Grammy Lifetime Achievement Award–winner Mavis Staples graces the Bardavon 1869 Opera House stage on Friday, January 20^th at 8 p.m. The legendary vocalist invites you to join her for  “An Evening with Mavis Staples” at this historic Poughkeepsie venue with tickets priced at $45.00 for non-members. For information call (845) 473-2072 or call the Ticketmaster at 800-745-3000.  Who doesn’t love Mavis??!!
• If you are just looking for a fun family outing, take ride to Hyde Park’s Roller Magic for Crazy Hat Night on Saturday, January 28^th from 7:30 to 1030 p.m. Not only is it great exercise, you can enter the hat contest for a chance to win a gift certificate.  Rollerkating or Rollerblading, is good, affordable family fun! For more information call 845-229-6666. It’s far less expensive than the movies!!

Go ahead and get out if you want. The weather is great.  These events and more can be found on the Dutchess County Tourism website.

Happy January… only 69 days until Spring!!

Kim Simms is a full-time licensed real estate salesperson and residential real estate consultant with Houlihan Lawrence Real Estate of East Fishkill, New York. She can be reached at ksimms@houlihanlawrence.com.

Posted by:  Kim Simms

So the question is, how far will you go in your daily commute, so that you can earn a decent pay while living in an affordable community with the desired quality of life for you and your family? We think we are justifying a longer travel time by getting what we want most from life…or are we just fooling ourselves??

A buyer client I am currently working with needs to commute to New York City and recently he fell strongly in like with a home in New Paltz, Ulster County, New York.  As I conduct my due diligence regarding the potential purchase of the house, and he does his with regard to the impact on his current lifestyle requirements, he mentioned that he came across this article titled Extreme Commuting.

I know, but look at the sunset from the screened-in porch.

Kim Simms is a full-time licensed real estate salesperson and residential real estate consultant with Houlihan Lawrence Real Estate of East Fishkill, NY. She can be reached at ksimms@houlihanlawrence.com.

Posted by:  Kim Simms

It’s 23° outside (in the sun!) as I write this. It feels abnormally cold - an abnormal response to weather that should be entirely expected in January in the northeast.  You have to admit, this winter has been almost balmy compared to last winter. This time last winter, we had already paid Jimmy our snowplow saint enough money for a house payment!

While I am busy counting down to the first day of Spring (77 days), it occurred to me it would be a good idea to remind homeowners of a couple of ways to keep their heating pipes from freezing this winter. I first wrote this article a year ago and it’s worth repeating.

Recently, I was speaking to a general contractor who mentioned he was working on a house in the Millbrook, New York area that had suffered freeze damage to the heating pipes. Apparently, the owners, who live out of the area, use this home as a weekend getaway and they'd been leaving the thermostat set at 55 degrees while they were away. Because of the recent snowstorms, they had not visited the house in a few weeks and when they recently returned, they discovered the pipes had frozen and burst, damaging floors and ceilings throughout the house. They thought they had set the thermostat high enough to prevent this from happening.

This being the third such story I've heard about frozen pipes since December, and this Dutchess County winter starting out rather harsh, I decided to consult someone in the heating industry to gain their opinion on what is the best way to prevent this from happening.

A knowledgeable oil burner technician from a local reputable oil company offered his opinion on two ways to help avoid the problem/cost of repairing the damage from frozen pipes. First, he said that while 55 degrees may seem like a reasonable thermostat setting in order to keep your pipes from freezing while you're not home, it certainly depends on the style of the house. He gave an example of a Raised Ranch - most have one to two bedrooms built directly over the garage which is typically unheated.

When you have consistent low temperatures like we are having this winter, where the overnight temps are at and well below freezing and the daytime temps don't warm up to at least freezing, the house can't warm up long enough in the daytime to retain heat.  If the thermostat is set on only 55 degrees, and the room below it is at near zero, eventually, you run the risk of having the pipes freeze.  In his opinion, everyone should set their thermostat on at least 65 degrees during these weather conditions, regardless of the style house you have.  Besides, he said that while most people believe they are saving oil, and he acknowledges that oil can be a costly heating system, you're really not saving at all because when you do get back and turn the heat up to heat the house, the system has to work twice as hard to heat the house. I imagine this could use more oil than you think you're saving and it could cause more wear and tear on your boiler.

Second, he said you can have an anti-freeze service done to protect your pipes from freezing. The anti-freeze protects your system up to between 20 and 30 BELOW zero. What surprised me is that I didn't know you can do this while you occupy your house and the heat is in use. This service lasts for 2-3 years and estimated cost is far less than it costs to fill up the typical 275 gallon oil tank!  It sounds similar to winterizing a home - as real estate agents, we strongly advise local sellers to winterize their vacant homes during this season.

So I learned two very good options that I will gladly pass on to my clients and anyone else who is not sure what to do. I believe both these options would work if you own a home in Dutchess County: set your thermostat to at least 65 degrees, whether you are home or not, or, have an anti-freeze service done that will protect your heating system and home in the event of the coldest anticipated temperatures. If you want to save money, and who doesn't - what's less expensive: Options one or two, or having to have the inside of your home rebuilt because frozen pipes have burst?

For more information on winterizing your home and contacting local reputable general contractors and heat service companies, contact Kim Simms, a full-time licensed real estate salesperson and residential real estate consultant with Houlihan Lawrence Real Estate of East Fishkill, NY. She can be reached at ksimms@houlihanlawrence.com.

Posted by:  Kim Simms

Starting a new year is like

a beautiful sunrise that you

just can’t take your eyes off of.

The thrill of expectations and starting fresh

from this day forward

is appealing, exciting, and powerful.

Step to the right my friend, Happy New Year.

Posted by:  Kim Simms

Recently, I was treated to lunch at a posh eatery in the Village of Fishkill.  Sapore Steakhouse is one of those expensive and intimidating places one dares not visit unless it's on an extra-special occasion. The good news is that the lunch menu offers many of the same meal choices as the dinner menu, but at a slightly lower price. So at mid-day, you can enjoy delicious cuisine without breaking the bank! My lunch partner ordered the Caesar salad which I'm told was delicious, and I sipped a rich and yummy lobster bisque. We each selected the hanger steak entree, which was cooked to perfection. Every morsel just melted in your mouth. Of course, I couldn't pass up the scrumptious crème brûlée for dessert!

The overall experience is orchestrated by service that is personable and gives attention to every detail. Our waiter was clearly a highly-trained professional who understood and explained the menu and wine selections well. He smiled often and made us feel welcome.

My favorite little Village of Fishkill offers an eclectic choice of eateries and places to shop and sight-see. One of the advantages to living in the village is the proximity of classic vintage homes located within walking distance. Side walks are rare in this region so being able to walk to dinner or to a local coffee shop is a treat. I hope you will take some time to visit. If you have any questions, give me a call!

Tammy Benkwitt is a 20 year real estate agent serving Dutchess, Putnam and Westchester counties. She can be reached on her cell 914.714.2127 or email . Call her if you are thinking of buying or selling!

Posted by:  Tammy Benkwitt

There's a sleepy little-known riverside hamlet called Chelsea, located in the Town of Wappingers Falls, New York.  It's a quiet little place comprised of just a few streets lined with picturesque frame homes.  Two churches, a little post office and the firehouse are all on the same street.   It's also home to the Chelsea Yacht Club, primarily a sailing club.  Sailboat races on Wednesdays and Sundays plus the sound of the Metro-North train whistle all add to its charm.

It used to be that homes didn't go on the market too often here...rather, they were passed on through generations and stayed right in the family.  Unfortunately, in recent years some have fallen into disrepair, most likely victims of the economy and real estate market.

A couple of contractors have recently bought and renovated homes here.  Nearly complete at the time of this writing, they are giving a welcome facelift to this special hamlet.   Another property was completely renovated by its owner, and it looks just like a house from Cape Cod, with its cedar shake siding. It has beautiful Hudson River views from its front porch.  I live nearby, and it has been absolutely wonderful watching the revitalization.

While some buyers are still skittish about buying in this market, savvy investors have decided the time has come to plunk down their cash.  These investors will help us dig out of this market by moving inventory, and they are breathing new life into some of these areas that have grown a bit tired.  Good for them!  Good for Chelsea!  Good for us all!

Posted by:  Dianne Minogue

This past Sunday was the Miles of Hope Breast Cancer Foundation Community Walk held at the James Baird State Park, Pleasant Valley. Over 500 walkers attended and this year marked their 9th annual walk.

Miles of Hope Breast Cancer Foundation is a non-profit foundation with a mission to provide funds to support programs for people affected by breast cancer in New York’s Hudson Valley. Click here to watch an introductory video about Miles of Hope. Other events that the foundation holds throughout the year includes: Hoops for Hope, the Annual Spring Brunch, the Family Run and Goals for Hope.

Houlihan Lawrence is a proud sponsor of this event. Our agents walk as a team and walk in honor and memory of friends, family and neighbors. It is great to do something for our community!

You can see where your donations go or donate now.

Join us in the fight against Breast Cancer!

Barbara Dudley is a broker/manager at Houlihan Lawrence in East Fishkill, New York and can be reached at 845-227-4400 x 222, , or www.barbaradudleyRE.com.

Posted by:  Barbara Dudley

This is probably a larger story than I can tell in a short space. I will do my best.  

Once upon a time, the Hudson River was a prime location for factories. Manufacturers could build products, easily pack them on a nearby boat, and the majestic river led those goods to locations all over the planet. As our world changed, of course so did the river towns. The large brick structures that once were the economic centers for many communities were left abandoned for one reason or another. In many cases, these old buildings were vandalized and became an eyesore to once thriving downtown centers. This past Saturday night, I and about 100 or more people watched something truly unique that was inspired and created by community artists who wanted to give an old building renewed purpose and bring joy to a community. It is called Electric Projected.

Photo Credit: www.ElectricWindowsBeacon.com

On July 31, 2010 artists took on the task of creating paintings that could cover the old windows of a defunct electric blanket factory. In 2011, the task was to create cartoon-like animations based on those very same paintings. A perfectly eclectic mix of ear-popping music was added to accompany the often colorful and amusing animations. The result was a series of short cartoons - each emanating from its respective window. The building not only served as a large outdoor movie screen, but the intricate cartoons were designed to use the windows and the brick as a template (check out this example). On October 1, 2011, after the sun set, those videos were projected in front of eager spectators who braved unusually cold weather to witness the event. I have to say it was well worth the wait.

Kudos to all the artists and local businesses that contributed to the Electric Projected project. Thank you for a great evening! I urge everyone to visit their website to see all who were involved and for more background information.

Below are a couple of short videos I took with my iPhone. They are best viewed in a large format and in low or no light. Enjoy!

http://youtu.be/kNligoBqKeI

http://youtu.be/-I9hSBQmj94

http://youtu.be/hHU_yDTatR4

Tammy Benkwitt is a 20-year real estate agent serving Dutchess, Putnam and Westchester counties. She writes this blog to provide both community and real estate information. Tammy can be reached at tbenkwitt@houlihanlawrence.com or on her cell 914-714-2127.

Posted by:  Tammy Benkwitt

RENTING YOUR HOME AND BUYING ANOTHER

Part 2 - Homeowners Insurance

In part 1 of this subject, I reported the general guidelines for obtaining a mortgage on a 2nd home while you rent your primary residence (click here or see 9/16/11: Our Kimunity - Renting Your Home and Buying Another, Part 1).

Since having the proper insurance coverage is the best way to cover yourself, your home, and tenant, I asked a 25 + year experienced insurance rep to educate me on the impact that renting your home has on your homeowner’s insurance policy. She said that the best way to minimize your risk of liability is for the homeowner (landlord), to replace their HOMEOWNER INSURANCE POLICY with a LANDLORD INSURANCE POLICY.

In the insurance company’s view, when you don’t live in the house you own, there is a much greater risk of liability that something will go wrong in the house. She cited an example of a tenant not reporting water leakage from a fridge (the ice machine broke) - they didn’t think it was a big deal and just kept wiping up the small puddles of water - and by the time they moved out, the floor under the refrigerator had buckled and cause extensive damage to the floors and adjacent cabinets. Had the owner been living there, it’s far more likely the homeowner would have addressed the leak as soon as it happened.

Although your Homeowner policy is less expensive than a proper LANDLORD POLICY, the risks are far greater than the additional premium. Plus, if the rented house has a loss that makes it uninhabitable to the renters, the policy will pay the lost rent to the Landlord. If you have a regular Homeowners policy there is no coverage.

Requiring the tenant to take out a TENANT insurance policy means the tenant has coverage for their own belongings. Additionally, Tenant’s insurance covers the tenant for temporary housing should they lose the use of the property they are renting. The Landlord’s policy does not cover the renter’s belongings!! Tenant’s insurance costs about $150 a year.

So if the point of renting the house is to get the money to pay the mortgage, it is imperative to have the Landlord’s policy. Seems to me, whether you want to rent your home with peace of mind, or live in and rent someone else’s house, you should get the right insurance policy. Your insurance company can’t fully cover you if you don’t have the correct policy. I didn’t know you could obtain the right coverage for such a reasonable cost. Happy Renting...

Kim Simms is a New York State Licensed Salesperson and Residential Real Estate Consultant with Houlihan Lawrence Real Estate Brokerage in East Fishkill, NY. She can be reached at

Posted by:  Kim Simms

What to do...This a phrase that can be statement or question. If it is a question- well, you may be in a quandry-a crossroad that has you perhaps talking to yourself, thinking through the next step. If it is a statement, that's even better! It means you have a plan in place. Most of us get to that point by making a to-do list-an evil neccesity. But if it gives you a gameplan, and peace of mind, then so be it.

However, try not to lose focus of what gives you pleasure in life-in other words, don't let the to-do list run your life-integrate it into the activities and projects that you look forward to doing. Sounds simple, but it does require attitude adjustment; so instead of saying "hmmm...what to do?" just do it!

Posted by:  Lisa Sanker

Eighteen  years ago, I walked into my office and saw a colleague looking fretful and upset. She was to have a closing later that day, but that was not to be. The house had burned down to the ground the night before. There are many reasons why a buyer needs to conduct a final walk-through. Making sure the house is still standing before you buy it is certainly an important one.

Let's first back up a bit and recap how we get to the final walk-through. Pretend you are the buyer. You make an offer on a house, negotiate with the seller to an accepted offer, and then you hire a home inspector to spend a few hours going over the house with a fine-tooth comb and everything checks out. A contract of sale is signed, you get your mortgage cleared-to-close, and a closing date is set. Now it's time to schedule when you re-visit the house and make sure it is everything you expect it to be - according to the contract you signed. This visit is commonly referred to as the final walk-through and it is usually scheduled to take place as reasonably close to the closing as possible. If the closing is in the afternoon, you do the walk through that morning. If the closing is in the morning, schedule it for the afternoon or evening prior.

Once you are at the house what exactly do you check? One of the first places I run to is a sink. I start running hot water in various places throughout the house. If the house had been vacant, it may take a while for the water to scald my fingers. To save energy, the seller may have set the hot water heater to vacation mode or the furnace may be off. I turn on the heat and place my hands on the baseboards throughout the house to make sure they are warming up. Sometimes we find a real problem and perhaps the furnace needs repair. It can happen. If there is central air, I will turn that on too.

The buyer and I will open up all cabinets and closets checking to see if the seller forgot to take anything. Most real estate contracts of sale will have language that states the house should be "broom-swept" and clear of debris. Sometimes sellers are kind and go to extraordinary lengths to clean the house usually out of pride and common courtesy. However, it is unlikely the contract of sale will say the house must be sanitized. So if the house is not as clean as you might keep it, don't be surprised. Did you want all those paint cans in the basement? If they are recently painted colors, maybe you do. During a walk-through I did at an older house in Poughkeepsie, I counted 44 cans of paint that had been left behind by the seller! No buyer wants that many old cans of paint. We requested that the seller either remove the cans prior to the closing or compensate the buyer. The seller removed the cans which was fine. Leaving behind rubbish for a buyer to remove is unfair and is usually considered "debris".

I will check the appliances to make certain they are running. I won't start a dishwasher because it takes too long to run through an entire cycle. I might run a quick rinse cycle if available just to see the power go on at least. The same goes for the washing machine. We will look over the entire exterior and interior from ceiling to windows to floor doing our best to notice if anything has changed since the inspection. Are there recent cracks in windows? Any newly noticed large stains on the carpet or floor? Did the movers perhaps make a significant dent in the wall?

If your contract of sale requires that the seller perform any repairs to the house, you need to make sure those repairs were completed. Most situations like this will require that the seller provide a receipt for work done by a professional which is given to the attorneys prior to setting up the closing date. But if there was anything not requiring a receipt, you need to check.

New York State requires working carbon monoxide and smoke detectors installed in the house by the time of closing. Unfortunately, many sellers will run to the store and buy them just prior to closing and leave them at the house in their original, unopened packaging. If that happens, make sure you install them soon as possible before you move in to keep you and your loved ones safe.

What happens if you do spy a problem on the walk-through? Like most agents, I have a smart phone with video camera. If I find something on a walk-through that seems unusual, I am taking video and showing it to my clients attorney. We will also call the listing agent and ask her to discuss the problem with the seller. Sometimes there is an easy fix. However, if it's not an easy fix, the attorneys will usually discuss the matter and possibly agree to holding a certain amount of money in escrow until the problem is resolved. This way the closing - and both parties - can move forward.

Some home inspectors may offer to accompany you at the final walk-through for an additional fee. It's not a bad idea. Be sure to compare pricing when you first hire an inspector for the initial visit. In any event, it is essential that your buyers agent be present with you to witness that either everything looks good, or that there is something amiss that needs to be addressed at the closing table.

Tammy Benkwitt is a real estate agent with twenty years experience working with buyers and sellers in Dutchess, Putnam and Northern Westchester counties in New York. She can be reached at tbenkwitt@houlihanlawrence.com or on her cell 914-714-2127.

Posted by:  Tammy Benkwitt

PART 1 – MORTGAGE FINANCING

The current real estate climate has prohibited potential sellers, who bought or leveraged their current home at the height of the market, from being able to sell their current home today and recover what they paid for it. This has resulted in sellers, who need or want to sell, to consider renting out their current home and purchasing their next home, in their mind, “until the market recovers.”

I’ve had several conversations with potential sellers in just the last three weeks about the possibility of doing exactly this, which has raised several serious questions concerning homeowner and tenant insurance policies, mortgage requirements, whether or not to use a property management company, and municipal compliance with turning your home into a legal rental property.

I find that most potential sellers just don’t have the information they need to make an informed decision on whether or not to rent their home while they pursue the purchase of another.

After speaking with Michael Marinaccio, a 20+ year experienced and knowledgeable home mortgage consultant with Thoroughbred Mortgage, I found out that current mortgage guidelines (conventional loans) require a potential seller to have at least 30% equity in the home they want to sell, in order to use the rental income to qualify for a new mortgage on the home they want to purchase. If they do not have 30% equity in the home, the bank will not consider the rental income and the owner would have to qualify for the new mortgage with the current full monthly debt of the home they want to rent.  A seller would have to know whether they could even qualify for the new loan with the additional debt of their current home.  FHA loans have a separate set of guidelines.

Implications on being able to qualify for a mortgage are just one consideration. Over the next few blogs, I will attempt to help evaluate the feasibility of this particular real estate goal by offering information that impacts the ability to move forward or not.

Michael Marinaccio HMC, is a Mortgage Consultant with Thoroughbred Mortgage and he can be reached at 845-742-4638; or click here to visit his website.
 
Kim Simms is a New York State Licensed Salesperson and Residential Real Estate Consultant with Houlihan Lawrence Real Estate Brokerage in East Fishkill, NY. She can be reached at

Posted by:  Kim Simms