Don’t Get Caught in the Rental Trap


There are many benefits to homeownership. One of the top ones is being able to protect yourself from rising rents and lock in your housing cost for the life of your mortgage.

Don’t Become Trapped

Jonathan Smoke, Chief Economist at, reported on what he calls a“Rental Affordability Crisis.” He warns that,

“Low rental vacancies and a lack of new rental construction are pushing up rents, and we expect that they’ll outpace home price appreciation in the year ahead.”

In the Joint Center for Housing Studies at Harvard University’s 2015 Report on Rental Housing, they reported that 49% of rental households are cost-burdened, meaning they spend more than 30% of their income on housing. These households struggle to save for a rainy day and pay other bills, such as food and healthcare.

It’s Cheaper to Buy Than Rentrent vs. buy, rent or own, rent a home, buy a home

In Smoke’s article, he went on to say,

“Housing is central to the health and well-being of our country and our local communities. In addition, this (rental affordability) crisis threatens the future value of owned housing, as the burdensome level of rents will trap more aspiring owners into a vicious financial cycle in which they cannot save and build a solid credit record to eventually buy a home.”

“While more than 85% of markets have burdensome rents today, it’s perplexing that in more than 75% of the counties across the country, it is actually cheaper to buy than rent a home. So why aren’t those unhappy renters choosing to buy?”

Know Your Options

home buyers, down paymentPerhaps you have already saved enough to buy your first home. HousingWire reported that analysts at Nomura believe:

“It’s not that Millennials and other potential homebuyers aren’t qualified in terms of their credit scores or in how much they have saved for their down payment.

It’s that they think they’re not qualified or they think that they don’t have a big enough down payment.” (emphasis added)

Many first-time homebuyers who believe that they need a large down payment may be holding themselves back from their dream home. As we have reported before, in many areas of the country, a first-time home buyer can save for a 3% down payment in less than two years. You may have already saved enough.

Bottom Line

Don’t get caught in the trap so many renters are currently in. If you are ready and willing to buy a home, find out if you are able. Let’s get together to determine if you could qualify for a mortgage now.


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Have Too Much Stuff? How to Clear Up Your Clutter

Home Decor

Your Stuff

“That’s all your house is: a place to keep your stuff while you go out and…get How more stuff….And maybe put some of your stuff in storage.  Imagine that. There’s a whole industry based on keeping an eye on your stuff. ”                                                                                   —- George Carlin

Today I’m going to give you some tips to simplify your household and get organized so you don’t have so much stuff.

The first step in getting rid of your stuff is to debug your own mind.  Most of us don’t recognize clutter when it falls out of the closet onto our heads, so how in the world will we conquer it?  Let’s start by defining what clutter is.  Clutter is anything in your home:

  • That is out of place
  • That is broken
  • That you have not used or worn in more than a year
  • That you dislike

Now don’t panic.  I won’t be telling you to throw away everything that falls within the above definition of clutter.  But once you get a clear picture in your head of what constitutes clutter you will be better able to deal with it.


Start In a Small Place

Let’s start in one small place (a closet or junk drawer for example) and put things in order. First, you will need four cardboard boxes and a large trash can.  Label the boxes as follows:

  • Put Away
  • Fix
  • Set Free
  • Mementos

Set an alarm clock to go off in one to two hours.  You don’t want to overdo things.  Open the closet or junk drawer and select the first object.  Now we will use the four definitions of clutter to help us decide what goes in the trash can or which box to use for each item:

Trash Can

The trash can.  You will find plenty of stuff that is absolutely unusable.  Be ruthless.

Home Decor

Put Away

The Put Away box.  Anything goes in here that is out of place and would be better off in a more convenient location.  As soon as the alarm clock goes off you will take ten minutes or so to put all the items in this box where they really belong.


The Fix box.  If the item is damaged or missing a part, but you are certain you would use it regularly if repaired, put it in this box.  Objects can only reside in the fix box for one week before they have to change residence.  If you do not repair the item by week’s end it must go into the “Set Free” box.

Set Free

The Set Free box.  This box will hold items that you dislike, things you haven’t used in more than a year, orphaned gifts from friends and family (when you said, “Oh, you really shouldn’t have!”), things that still have some good use in them, things that will surely fit again “someday.”  This box will go in the trunk of the car.  You will take the box to a local resale store or to a charity center.  Many charities will even pick up this stuff at your front door-what convenience.  You will be doing a good thing, since someone will be getting some good out of these items right now.


The Mementos box.  This one can be a bit tricky.  It’s for things that have true sentimental or family heirloom value.  You will want to invest in a cedar chest or other similar sized permanent storage unit.  The items from this box will go into that permanent storage.  But remember, that cedar heirloom chest will fill up rapidly if you are too casual about “what’s an heirloom.”  Consider passing on some of these things to extended family members right now-don’t wait 20 years.

Now you are one closet closer to having a serene, uncluttered home.  Next week take this same process and tackle another corner of the house.

How to Keep Yourself from Getting Too Much Stuff

As Benjamin Franklin said, “An ounce of prevention is worth a pound of cure.” This is definitely true for stuff. If you don’t collect too much stuff in the first place, you won’t have to clean out your closets or junk drawer(s) too often, either. Here are some ways to prevent clutter in the first place:

Garage sales are events you stage, not events you attend

Unless you are a professional junk or antique dealer, there is no reason for you to ever attend a garage sale.

Arts & Design

Discover the joys of borrowing

Let’s be honest.  There are some things you might only use two or three times a year (fondue set, espresso maker, sewing machine, etc.).  You don’t need to buy these things.  Your friends will be happy to dig them out from under their beds and loan them to you if you ask.

Throw away newspaper inserts

Throw away those full-color store ad inserts in your newspaper and the mailbox; do not browse them first.  I’m talking about the good ones from Walmart, Kmart, Target, Kohl’s, etc.  Those ads exist for one reason only: to make you think you need more stuff.  I know, you think you are just window shopping, but that is the first step to buying a juicer with ten attachments, a second George Foreman Grill, or a desktop fountain like the one in your attic.

Steer clear of internet shopping sites

Treat eBay (and other internet shopping sites) like disaster sites: steer clear of them.  You will not escape unscathed.  Clutter will leap into your shopping cart of its own volition.

Buy to replace

If you absolutely must buy something, do it only to replace something you already have.  It’s OK to replace your grill, the refrigerator, your coffee table. Just don’t multiply them.



2 Myths About Mortgages That May Be Holding Back Home Buyers

mortgage, myths, home buyers, buy a home

Fannie Mae’s “What do consumers know about the Mortgage Qualification Criteria?” Study revealed that home buyers are misinformed about what is required to qualify for a mortgage when purchasing a home.

Myth #1: I Need a 20% Down Payment

Fannie Mae’s survey revealed that home buyers overestimate the down payment funds needed to qualify for a home loan. According to the report, 76% of Americans either don’t know (40%) or are misinformed (36%) about the minimum down payment required.

Many believe that they need at least 20% down to buy their dream home. New programs actually let buyers put down as little as 3%.

Below are the results of a Digital Risk survey of Millennials who recently purchased a home.

down payment, buy a home, home buyers

As you can see, 64.2% were able to purchase their home by putting down less than 20%, with 43.8% putting down less than 10%!

Myth #2: I need a 780 FICO Score or Higher to Buy

The survey revealed that 59% of Americans either don’t know (54%) or are misinformed (5%) about what FICO score is necessary to qualify.

Many Americans believe a ‘good’ credit score is 780 or higher.

To help debunk this myth, let’s take a look at the latest Ellie Mae Origination Insight Report, which focuses on recently closed (approved) loans. As you can see below, 54.1% of approved mortgages had a credit score of 600-749.

fico score, credit, home buyers, down payment

Bottom Line

Whether buying your first home or moving up to your dream home, knowing your options will definitely make the mortgage process easier. Your dream home may already be within your reach.


Bird Watching in Your Ashburn Backyard

bird watching, Ashburn, VA, backyard, garden
Bird watching is a popular past time that many share, but what if watching your fluttering friends was as simple as peeking into your backyard? Thanks to a few landscaping techniques, you can trade in your binoculars for a lawn chair and enjoy bird watching from the convenience and comfort of your own Ashburn home.

Attracting Birds Of A Feather

If you want to attract birds to your backyard, you have to make it a place that they will be drawn to. One way of doing this is by studying the feeding or nesting habits of the birds that you want to attract. Like any other animal, birds have unique characteristics that are specific to their type and knowing what they enjoy will be your first step toward inviting them into your backyard.

Bird Basics

Birds have three basic needs: food, shelter and water. By planting familiar foliage, you will be providing a protective covering for birds. Flowers, inviting nesting areas and a birdbath will provide additional comfort for your feathered friends.

Bird food, which is commonly available at any retail store, is often specific to certain bird types. For instance, black oil sunflower seeds will attract goldfinches and chickadees, while millet seeds are appealing to doves and sparrows. If you want to attract a hummingbird, you will need to include a sugar-water feeder in your backyard landscaping. A bird feeder, which is used to house seeds and food for your backyard birds, should be cleaned regularly.

Just Splashing Around

Believe it or not, a birdbath is a terrific aspect to include in your landscape if you want native birds to feel welcome. This single feature offers birds a way to bathe and drink, which makes your backyard especially inviting to visiting birds. It’s important to add fresh water regularly and keep birdbaths clean and free of bacteria buildup. Another popular water feature, which is great for both landscaping appeal and attracting birds, is a fountain or waterfall. The sound of trickling water will serve as an inviting habitat for birds.

House Hunting

bird watching, bird house, gardenIf you want to attract birds, you need to provide them with a birdhouse. These structures provide a safe environment for your feathered friends and offer a way for them to feel right at home. When choosing a birdhouse, you must consider the size of the bird that you will be attracting as the size of the entrance hole will greatly be determined by the bird that will be using it. A quality birdhouse must have proper ventilation to ensure proper air circulation, and the drainage capability must also be considered in order to keep the bird’s nest dry and free of any water buildup.

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Buying a Home: 5 Ways It’s Different From TV Shows


Have you ever been flipping through the channels, only to find yourself glued to the couch in an HGTV show hole? We’ve all been there… watching entire seasons of Love it or List it, Fixer Upper, House Hunters, Flip or Flop, Property Brothers, and so many more, in just one sitting.

When you’re in the middle of your real estate themed show marathon, you might start to think that everything you see on TV must be how it works in real life, but you may need a reality check. Here are five ways buying a home in real life differs from what you see on TV.

Myth #1: Buyers look at 3 homes and make a decision to purchase one of them.

Truth: There may be buyers who fall in love with and buy the first home they see, but more often than not the process of buying a home means touring more than three homes.

Myth #2: The houses the buyers are touring are still for sale.

Truth: In reality, the home is being staged for TV. Many of the homes being shown are already sold and are off the market.

Myth #3: The buyers haven’t made a purchase decision yet.

Truth: Since there is no way to show the entire home buying process in a 30-minute show, TV producers often choose buyers who are further along in the process and have already chosen a home to buy.

Myth #4: If you list your home for sale, it will always sell at the open house.

Truth: Of course this would be great! Open houses are important to guarantee the most exposure to buyers in your area, but are only a piece of the overall marketing of your home. Just realize that many homes are sold during regular listing appointments as well.

Myth #5: Homeowners make a decision about selling their home after a 5-minute conversation.

Truth: Similar to the buyers portrayed on the shows, many of the sellers have already spent hours deliberating the decision to list their home and move on with their life or goals.

Bottom Line

Having an experienced professional on your side while navigating the real estate market is the best way to guarantee that you can make the home of your dreams a reality.

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How Do Rising Prices Impact Your Home Equity?

Today, many real estate conversations center on housing prices and where they may be headed. The Home Price Expectation Survey provides the answers.

Every quarter, Pulsenomics surveys a nationwide panel of over one hundred economists, real estate experts, and investment and market strategists about where they believe prices are headed over the next five years. They then average the projections of all 100+ experts into a single number.

The results of their latest survey

Home values will appreciate by 4.5% over the course of 2016, 3.6% in 2017 and about 3.2% in the next two years, and finally 2.9% in 2020 (as shown below). That means the average annual appreciation will be 3.5% over the next five years.

home equity

The prediction for cumulative appreciation increased slightly from 17.5% to 18.7% by 2020. The experts making up the most bearish quartile of the survey are still projecting a cumulative appreciation of 11.1%.

home equity

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

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

potential growth in family wealth based on increased home equity

Since the experts predict that home prices will increase by 4.5% this year alone, the young homeowners will have gained over $11,000 in equity in just one year.

Over a five-year period, their equity will increase by over $46,000. 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

Home ownership 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, let’s meet up to find out if you are able to today.

10 Questions to Ask Yourself During Your Annual Financial Review

10 essential questions to ask yourself during your financial review. You get a dental check up every six months to make sure your teeth are healthy and a physical every year to ensure you’re in good health. You should take similar care of your financial well-being with an annual checkup of essentials, such as your credit, retirement savings and life insurance.

Your annual financial review should include the following nine elements:

1. Make a budget

Consider your likely spending habits and financial goals for the coming year and ask yourself a few
questions, including:

  • Does your income cover your expenses? Do you have enough left over for savings or do you need to scale back?
  • Do you need to save for an anticipated expense, such as home maintenance or a new car?10 questions to ask yourself during your annual financial review

2. Review your emergency fund

Plan for the unexpected, such as a layoff, medical expense, or major car repair. Most financial experts recommend saving enough to cover six months of fixed expenses; if that seems out of reach, aim for 90 days to begin.

3. Review your debt

Check your credit card balances and other loans to see if your debts have increased or decreased since your last financial check up. If your debt has increased, you may need to cut spending.

Compare the interest rates on your mortgage, car loan or other loans to current interest rates. You may be able to save money by refinancing.

4. Evaluate your retirement funds


© Dennis Thompson | Dreamstime Stock Photos

Does the amount you’re saving meet your needs and goals? Are you maxing out your employer match? Does your retirement portfolio have the right mix of assets, or do you need to rebalance your 401(k)?

5. Evaluate insurance coverage

Meet with your insurance agent to make certain that your life, homeowners and car insurance policies still meet your needs.  Ensure that your insurance liability limits are still high enough to protect your assets, and that your homeowners policy limit is high enough to replace your home and possessions if they’re destroyed.

6. Optimize your taxes

Make sure you’re not missing any tax deductions and credits for retirement and education savings, dependent care, medical expenses and charitable giving. Reduce your withholding if you received a large tax return this year or increase your withholding if you owed money.

7. Request your free credit reports

Go to to get a free copy of your credit report. Review your credit report for accuracy; if you find errors, notify the credit reporting company and the information provider (such as a credit card company or utility) in writing.

8. Start a college fund

If you have kids, start a tax-advantaged 529 education savings plans or prepaid tuition programs. Earnings on 529 savings plans aren’t taxed if used for qualified expenses such as tuition, fees, books, and room and board. Prepaid tuition programs lock in current costs for public colleges and universities, although you can also use the money at private colleges and public schools in other states.

9. Plan for the end

If you do not have an estate plan, meet with an estate attorney to start one. If you have an estate plan, revisit it to make certain that your will conforms to your wishes, determine whether you need to update the beneficiaries of your retirement plans and life insurance, whether your health directives reflect your desires and more.

These nine elements are the foundation of your financial well-being. If you own a home, however, there’s one more thing you need to check.

10. What’s my home worth?

© Dennis Thompson | Dreamstime Stock Photos

Your home is both a place to live and an investment that builds your family’s net worth. That’s why it

makes sense to check your home’s value as part of your annual financial checkup.

If you’re underwater in your mortgage, use this calculator to see when you’ll be back in the black.


Home Values Today Compared to Pre-2008 Peak

This housing market has many people talking about home values; where they are and where they are headed. It’s also interesting to look back and see how home prices compare to values prior to the housing crisis.

Every quarter, Freddie Mac releases their House Price Index. The index usually provides monthly home values for:

  • The nation as a whole
  • Each of the 50 states
  • 367 metropolitan statistical areas

This quarter, the report also included a look at today’s home values as compared to pre-2008 values. Here is a graphic that breaks down the numbers on a state-by-state basis:

Home values compared to their pre-2008 peak