Each month, we publish a series of articles of interest to homeowners -- money-saving tips, household safety checklists, home improvement advice, real estate insider secrets, etc. Whether you currently are in the market for a new home, or not, we hope that this information is of value to you. Please feel free to pass these articles on to your family and friends.
Prepare for the Unforeseen: Safeguarding Your Home and Finances
Emergencies can happen in the blink of an eyefires, hurricanes, floods, earthquakes, tornadoesthey can strike without warning, anywhere, at any time. While your utmost concern is the safety of your loved ones and your property, it's equally essential to shield yourself from the financial aftermath of a disaster. A sudden catastrophe can inflict substantial harm to your property, force temporary relocations, disrupt income streams, and jeopardize valuable financial records.
Outlined below are practical steps that make sense and are easy to implement. Before taking any measures, remember to involve your family or friends in decision-making and planning whenever possible. Consider seeking guidance from professionals like Certified Financial Planners, insurance agents, or similar financial experts.
The key is to initiate your preparations now, preventing the unexpected from becoming a harsh reality.
Safeguard Your Property
Start by identifying potential disasters in your areawhether it's fire, flood, earthquake, hurricane, or tornado. Take proactive steps to reduce potential physical damage to your property in case of a disaster. Not only does this enhance safety, but it can also lead to reduced insurance costs. For instance, you can:
If you're in the market for a new home, factor in construction type, as different materials offer varying levels of protection against different types of disasters.
For guidance, reach out to local authorities like fire departments or utility companies, especially in earthquake-prone areas, to learn safety practices and procedures.
Create a Household Inventory
Document all your possessions by creating a comprehensive list. In the event of a disaster, this inventory can serve multiple purposes:
To conduct a thorough inventory:
If the task feels daunting, consider using software designed for this purpose, available at local computer stores.
Remember to store a copy of your inventory list in a secure location, such as a safe deposit box, or with relatives or friends.
Secure Appropriate Insurance
Even with ample time to prepare, unavoidable damage can occur. Insurance for homeowners or renters can provide significant assistance during these times. It's crucial to ensure you're adequately covered, as many individuals impacted by recent disasters found themselves underinsured or without coverage.
Consider Special Coverage:In addition to standard coverage, inquire about extra coverage for:
Prepare Your Finances
In the aftermath of a disaster, having access to funds is crucial. Consider these financial steps:
Craft an Evacuation Box
Create a secure and accessible "evacuation box" for emergencies. This box should contain essential items like:
Rent a Safe Deposit Box
Safe deposit boxes are ideal for preserving important documents. Store items like:
Consider renting a safe deposit box in a distant location to safeguard against localized disasters.
Home Safes and Fire Boxes
While home safes and fire boxes are convenient, they might not withstand extreme disasters. For ultimate protection, keep original documents in a safe deposit box or away from your home.
Plan Ahead if Time Allows
When there's sufficient warning, take the following steps:
While it might seem overwhelming, even implementing a portion of these suggestions can significantly enhance your financial preparedness for disasters. Your proactive efforts now can go a long way in mitigating the impact of unexpected events.
6 Mistakes To Avoid When Trading Up to a Larger Home
".....you have to sell your present home at exactly the right time in order to avoid either the financial burden of owning two homes or, just as bad, the dilemma of having no place to live during the gap between closings...."
Unlike the experience of buying a first home, when you're looking to move-up, and already own a home, there are certain factors that can complicate the situation. It's very important for you to consider these issues before you list your home for sale.
Not only is there the issue of financing to consider, but you also have to sell your present home at exactly the right time in order to avoid either the financial burden of owning two homes or, just as bad, the dilemma of having no place to live during the gap between closings.
In this report, we outline the six most common mistakes homeowners make when moving to a larger home. Knowledge of these six mistakes, and the strategies to overcome them, will help you make informed choices before you put your existing home on the market.
1. Rose-colored glasses
Most of us dream of improving our lifestyle and moving to a larger home. The problem is that there's sometimes a discrepancy between our hearts and our bank accounts. You drive by a home that you fall in love with only to find that it's already sold or that it's more than what you are willing to pay. Most homeowners get caught in this hit or miss strategy of house hunting when there's a much easier way of going about the process. For example, find out if your agent offers a Buyer Profile System or House-hunting Service, which takes the guesswork away and helps to put you in the home of your dreams. This type of program will cross match your criteria with ALL available homes on the market and supply you with printed information on an ongoing basis. A program like this helps homeowners take off their rose-colored glasses and, affordably, move into the home of their dreams.
2. Failing to make necessary improvements
If you want to get the best price for the home you're selling, there will certainly be things you can do to enhance it in a prospective buyer's eyes. These fix ups don't necessarily have to be expensive. But even if you do have to make a minor investment, it will often come back to you ten fold in the price you are able to get when you sell. It's very important that these improvements be made before you put your home on the market. If cash is tight, investigate an equity loan that you can repay on closing.
3. Not selling first
You should plan to sell before you buy. This way you will not find yourself at a disadvantage at the negotiating table, feeling pressured to accept an offer that is below market value because you have to meet a purchase deadline. If you've already sold your home, you can buy your next one with no strings attached. If you do get a tempting offer on your home but haven't made significant headway on finding your next home, you might want to put in a contingency clause in the sale contract which gives you a reasonable time to find a home to buy. If the market is slow and you find your home is not selling as quickly as you anticipated, another option could be renting your home and putting it up on the market later - particularly if you are selling a smaller, starter home. You'll have to investigate the tax rules if you choose this latter option. Better still, find a way to eliminate this situation altogether by getting your agent to guarantee the sale of your present home (see point number 5 below).
4. Failing to get a pre-approved mortgage
Pre-approval is a very simple process that many homeowners fail to take advantage of. While it doesn't cost or obligate you to anything, pre-approval gives you a significant advantage when you put an offer on the home you want to purchase because you know exactly how much house you can afford, and you already have the green light from your lending institution. With a pre-approved mortgage, your offer will be viewed far more favorably by a seller - sometimes even if it's a little lower than another offer that's contingent on financing. Don't fail to take this important step.
5. Getting caught in the Real Estate Catch 22
Your biggest dilemma when buying and selling is deciding which to do first. Point number 3 above advises you to sell first. However there are ways to eliminate this dilemma altogether. Some agents offer a Guaranteed Sale Trade-Up Program that actually takes the problem away from you entirely by guaranteeing the sale of your present home before you take possession of your next one. If you find a home you wish to purchase and have not sold your current home yet, they will buy your home from you themselves so you can make your move free of stress and worry.
6. Failing to coordinate closings
With two major transactions to coordinate together with all the people involved such as mortgage experts, appraisers, lawyers, loan officers, title company representatives, home inspectors or pest inspectors the chances of mix ups and miscommunication go up dramatically. To avoid a logistical nightmare ensure you work closely with your agent.