Buyer Tip: Home Shopping Checklists

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Home shopping can be an arduous process, and at the end of a day of looking at homes, your mind may be a blur of floor plans, parking spots, backyards and front doors. Keeping each home you see straight in your mind can be easy, if you just bring the right tool along for the ride: a home shopping checklist!

Homebuyer Tips: Home Shopping Checklist

Don't let home shopping be more difficult than it has to, use a checklist to help streamline the process.

That’s right. One of the most powerful tools you can use in the course of your home search is the humble list. Much like the grocery list you bring to the supermarket so that you don’t forget the milk, a home shopping checklist prompts you to assess each of the particular features of a home and community, and then allows you to compare those assessments across every home that you see.

A good checklist will include space for every important feature of a home, including its price, square footage, general condition, outdoor space, and extra amenities like fireplaces or hot tubs. It should also include a place where you can make notes about the surrounding neighborhood (condition of neighbors’ homes, location of busy streets, community perks like parks or playgrounds), as well as important things like the neighboring schools, commute accessibility, and convenience to community amenities such as shops, dining and doctors’ offices.

There are a number of home shopping checklists online, such as this one from the Department of Housing and Urban Development (HUD), or this easy-compare version from home finance website Mortgage 101. If neither works completely for you, you can always create your own checklist using a spreadsheet or word processing program. Just use existing checklists as a guide on what to include.

Once you find a checklist that fits your needs and includes the items most important to you, be sure to print out a number of the checklists and bring them with you during your house hunting. You can fill out the checklist once your return to your car, or you can use the it as a reminder of what to examine as you walk through the home. Either way, be sure to fill out the list when your impressions of the home are fresh in your mind. Be honest, be thorough, and your checklist will provide you with a convenient record of your home search, allowing you to clearly consider the pros and cons of each property you saw, without getting confused about which home had what where.

Good luck, and happy house hunting!

Extend Your Enjoyment: Gardening for the Fall

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Although the high blush of summer may be over, that doesn’t mean that your love affair with your garden has to come to an end. Although autumn has the reputation for heralding the impending death or dormancy of many plants, there are actually a number of ways home gardeners can easily extend the life of their landscape well into the late months of the year, while preparing the garden for the coming tumult of cold and wintry weather.

Fall Gardening: Vegetable Garden

Fall is the perfect time of year to plant that vegetable garden you've always wanted.

Think Vegetables. Vegetable gardening has seen a resurgence of interest over the past few years, as ambitious land owners seek to make the most of every food dollar. Luckily, in many parts of the country—particularly in Texas—autumn can be one of the most productive in terms of vegetable growth. The searing summer heat is gone, and more moderate temperatures encourage growth of traditional fall vegetables like broccoli, cauliflower, Brussels sprouts, carrots, beets and turnips. In most of Central Texas, the first frost of the fall isn’t expected until roughly mid-November to mid-December, so September is the ideal time to get seedlings for these vegetables into the ground. In Southern Texas, with no frosts, vegetable gardening can go through the fall into late Spring, offering a long and productive growing season.

Think Color. Once the color has faded from your summer plants, you can make the move into some stunning autumnal annuals. Mums, pansies, snapdragons, violas, and cyclamen are just some of the fall annuals that bloom well in Texas, and they can extend your enjoyment of the garden into the late autumn and early winter. In addition, ornamental varieties of cabbages and kale also provide intense color and variegated interest in your garden, and they withstand the rigors of fall weather thanks to their hardiness and toleration of cooler temperatures.

Think Fun. Fall can be a great time for gardeners to enjoy their outdoor spaces for one last season, taking advantage of cooler, crisp evenings and mild, sunny days to entertain friends and family, or simply relax with a good book and a beverage. Creating snug spaces outdoors for fun can be as easy as grouping some chairs with an outdoor fire pit, accentuating the space with whimsical container plantings that incorporate some of the season’s best annuals. You can also make the area more welcoming by adding throw blankets to seating, changing out pillow covers from summer to autumn color themes, and adding a rug underfoot to bring comfort and define the space.

Think Spring. Finally, as counter-intuitive as it may seem, Fall is the time when gardeners do their best preparation for the excitement of the Spring garden. The duties of fall gardening—deadheading, trimming, pruning and fertilizing—may not be the most glamorous of gardening duties, but they are the keys to having a healthy, colorful and productive garden throughout the next year. So as you enjoy fall’s beautiful—though shorter—days, don a cap, go out into the garden with tools in hand, and make the best of these routine but all-important tasks. After all, come the cold weather of winter, you’ll enjoy knowing that all has been put right, and that your garden will once again explode into the glory of Spring, thanks to your careful and attentive care.

All About: The Good Faith Estimate

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In this installment of our “All About” series (aimed at providing important information to first-time homebuyers regarding the home buying and financing process), we’re covering one of the most important documents you’ll see in the course of obtaining your mortgage: the Good Faith Estimate (or GFE).

Mortgage Loan: Good Faith Estimate

A Good Faith Estimate is presented by the lender to inform the buyer of their borrowing amount.

What is a Good Faith Estimate, and why should I care?
A GFE is given to you by a lender once they accept your mortgage application—usually within a few days. This document serves as the lender’s proposal for how much they will lend you (and at what cost), and it provides the most holistic, accurate snapshot of the expenses associated with the origination, dispersal and repayment of your mortgage loan. Beyond teaser rates and inexact advertised rates, the Good Faith Estimate is just that—an estimate of your expenses and fees, estimated in good faith by your lender. It tells you what you will really have to pay in order to obtain a mortgage for your home purchase.

What will I find on the GFE?
The Department of Housing and Urban Development (HUD) offers a glimpse at a typical Good Faith Estimate on their website. By looking at this example, you can see that a GFE outlines the basic numbers on your loan (loan amount and terms), then goes on to enumerate the charges for originating the loan (getting you the money), settling title insurance, and filing government paperwork, among other things. It then goes on to calculate the cost of your deposit into the escrow account, the costs associated with third-party services involved in the sales transaction, and states the pro-rated interest you will owe for the time between your closing and your first mortgage payment. In short, it is a summation of all of the charges you will be expected to pay on the day of your closing, as well as the costs of the mortgage that you will pay monthly thereafter.

What makes the GFE so important?
Because it is a clear-cut estimation of the fees and costs associated with your loan, you can use GFEs generated by different lenders to compare quotes from those lenders and brokers. This means that you won’t get swayed by a lower rate on one loan, only to find out that the low-rate lender is charging hundreds or thousands more in fees and closings costs than a competitor with a slightly higher rate. The GFE also means that you won’t be surprised when you encounter all of those fees on the closing date!

Are the numbers on the GFE binding to the lender?
The Good Faith Estimate is just an estimate, so the final numbers you see at your closing may be slightly different. However, the information that the lender provides to you regarding origination costs generally cannot be changed once the GFE is issued to you, the borrower. The final closing costs usually cannot go over the estimated costs by more than ten percent of the stated third-party fees—such as for appraisals, inspections and credit reports—so your final costs should be well approximated by the GFE, if not exactly so.

Buying a Home Right out of College

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If you’re beginning your final year of college—or if you’ll be a winter grad—you may be wondering whether or not you are poised to take advantage of today’s buyer-friendly real estate market upon your graduation.

If you're about to become a college grad you can take advantage of the buyer-friendly real estate market.

After all, you just about have your college degree, and may well have a job lined up once your schooling days are over. You’ve probably realized that the beauty of buying a home when you’re young is having plenty of time to accrue equity, allowing you to start developing a nest egg that will move you further ahead (and keep you more financially secure) as your life goes on. Is it possible to buy a home right out of college? Sure! There are just a few things you need to tend to before you can dive in and start looking for your first home.

If you’re lucky enough to have avoided the credit pitfalls that some younger adults run into in college (unrestrained spending coupled with unpaid credit card bills), then you may well have a solid credit rating. Having good credit will help you obtain the best lending terms and the lowest interest rates, so check your FICO, and review your credit report for any problems. If you find that you don’t have a credit report or FICO (and you may not, if you’ve never had a credit card and didn’t take out any student loans), you can ask your parents to add you as an authorized user to their credit cards, which will in essence make their credit score your own. (Just be sure that they have good credit before you do so!)

After taking care of the groundwork, you’ll have to start thinking about your housing budget. College graduates, depending upon the industry into which they are entering, don’t tend to make a lot of money. Entry-level salaries are just that—entry level—and as such, usually only accommodate a basic lifestyle. In conjunction with student loan repayment, those salaries may not stretch as far as you would like. However, you don’t have to look far to find affordable new homes! Builders like LGI Homes specialize in creating beautiful homes crafted with value and quality in mind, and our new homes communities are located within easy commute of both downtown recreational areas and urban/suburban office complexes. By looking to an affordable builder like LGI Homes, you’ll find that the entry-level salary and student loan bills won’t dent your ability to buy the best housing in a place that you’ll love to be.

Finally, buy with an eye on the future. While a single, college-graduate may not need a three-bedroom home, if your heart is set on the community in which you buy, you may well be able to fund the purchase of such a home by bringing in roommates to help with your monthly mortgage obligations. On the flip side, if you’re thinking that your first home purchase is all about building equity, and not about buying a permanent place to live, you can opt for a smaller-sized floor plan that suits your independent lifestyle, and doesn’t require the upkeep of a larger home. Just take a moment to think about your goals and aspirations, and you’ll be more likely to make a home buying decision that works best for both your present and future you.

Good luck!

Three Reasons Why New Homes Are Better

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Many homebuyers—whether first-time homebuyers or repeat buyers—are now being enticed back into the real estate market, thanks to historically-low interest rates, exceptional affordability, and the strength of real estate as long term investment. Many of these buyers are seriously considering purchasing existing homes because of their low price point. Yet while the price may seem right, there are a number of ways in which existing homes—particularly distressed properties—pale in comparison to new homes. We may be biased, but after considering the points below, we think you’ll agree that existing homes may not be the “deal” that they initially seem to be.

Pearland, Houston, Texas New Homes: Sterling Lakes

Buy a new home in the Houston suburb of Pearland at LGI Homes' Sterling Lakes for only $679 per month!

Do you know what you’re getting? An existing home is like a question mark—you can never be entirely sure about what you’re getting when you take full possession. With many existing homes, issues may extend deep into the structural heart of the home, meaning that a nasty surprise could be waiting for you when a routine repair encounters an unsound (and possibly unsafe) state of affairs. With new homes, what you see is what you get. You’re starting from the very beginning, so there’s no question about whether the appliances, wiring, HVAC or roof will last. Which means that you won’t have to worry ceaselessly about the potential repairs that may be just around the corner, ready to exhaust your morale and drain your bank account.

Are you covered? With existing homes, you buy what you buy, and if something goes awry on your watch, it’s your responsibility to fix it. Period. If something in your new home goes wrong, you’re under warranty! At LGI Homes each home we build is covered by ten-year structural and two-year mechanical warranties, because we stand by the quality of our construction, the durability of our installed appliances, and the ability of our workers. This means that you’re protected against a financial blow should something go wrong in your home, not just for days but for years after you move in. Trying getting confident coverage like that in an existing home!

Are you up-to-date and up-to-code? Home construction, like everything else in our fast-paced world, has advanced considerably over the years, and even a decade’s difference between construction dates can reveal huge changes in the way in which two homes may have been built. With an existing home, you’re investing in (and likely living in) a home built with methods and technologies that are sub-standard to what is being used today. New homes are more energy-efficient, are easier on the environment, are regulated against the use of potentially toxic substances like lead or asbestos, and having plumbing and electrical systems designed to the latest and safest code specifications. With existing homes, you simply can’t be sure, and the expense of rectifying outdated infrastructure can cost you thousands.

Are distressed properties and existing homes a great deal? Not necessarily. If you factor in the liabilities, uncertainty and potential expenses attendant to them, it becomes clear that new homes, despite an ever-so-slightly higher purchase price, can actually save you lots of time, money and anxiety over the longer term.

When Kid Rooms Grow Up

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With school already begun in many parts of the country, friends of your tween or younger teen are likely coming over to do homework and hang out after school. If you haven’t bought a new home recently, parents are likely to hear: “When can I redecorate this baby’s room?” The drive tweens and teens have to create a space entirely their own is a common one, and their rooms are the most natural extension of this need for personal expression. While their room has languished in their toddler and child years, your kids are likely eager to take the next step, and create a room more reflective of their more grown-up selves. Here are some tips to help your teen make those changes, without breaking your bank or losing your mind in the process.

Decorating a Room for a Teenager

If your teen hasn't already asked to redecorate his/her room, he/she certainly will soon!

  • Re-purpose
  • Take stock of what items in the room can be reused in the new decorative scheme, whether or not they are used for their original purposes. Tables can be turned into desks, lampshades can be recovered, and small bookcases can become bedside tables. The less you have to spend on essentials, the more you can budget in for fun accessories down the road.

  • Paint!
  • Paint is the cheapest way to redecorate any space, and your teen’s room is no exception. Letting them pick the paint color may be hard, but remember that paint isn’t forever—and likely neither is your kid’s penchant for fluorescent green. Remember that this is about giving your child the freedom to create their own space, so work with them to find a paint color that they will truly enjoy.

  • Use fabrics
  • Fabrics are another cheap way to add flair to a room without investing a whole lot of money. Use fabrics to sew pillows, make curtains, or make a new bed spread. You can also frame swaths of fabric and hang them as inexpensive wall art.

  • Add storage
  • A classic problem for teens is the lack of storage found in their room. As children, their clothes were smaller, and their toys took front and center. Now, they likely have closets bulging with clothing, games, books, sports equipment and electronics. If you can’t expand their closet space, get creative and find space for storage along the walls or under the bed. Chests or banquette seating that opens at the top are great for storing seasonal items, while also providing extra seating for visiting friends.

  • Negotiate
  • Lastly, don’t be afraid to negotiate these style changes with your child. While freedom of expression is important, creating a liveable space that meets your expectations while satisfying their sense of self is the primary goal. For instance, if you refuse to cave in to lime green walls, work with your child to pick a more neutral wall color, while using fabrics and accessory accents to bring in the lime green color that your child craves. Working around impasses can turn this project into a fun and creative endeavor, instead of making it a stand-off fraught with arguments and frustration.

All About: ARMs

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If you’ve been shopping for a home, you’ve probably already realized that there is a dizzying array of mortgage products available to home buyers, each suited to a different financial circumstance. While the 30-year fixed-rate mortgage is an industry standard (and what many think of when they think of mortgages), there are actually a wide variety of viable financing alternatives, including no money down homes and the Adjustable Rate Mortgage (also known as an ARM). In this “All About” article, we’ll cover the basics of ARMs, their benefits and drawbacks, and whether or not this type of mortgage may be right for you.

Adjustable Rat Mortgage (ARM) Info

If you plan on buying a home in the near future, it's important to understand your available financing options.

What is an ARM?
ARMs—Adjustable Rate Mortgages—differ from traditional fixed-rate mortgages in that the interest rate associated with the loan changes (adjusts) over the life of the loan. There are many variations of ARMs, including “option ARMs,” which allow borrowers to choose from a pre-determined set of payment options (such as interest-only payments, set minimum payments, etc.).

How often does the interest rate on an ARM adjust?
The adjustment periods on ARMs differ depending upon which mortgage product you choose to use. However, most ARMs typically have a fixed-rate period of a few years, after which the interest rate is regularly adjusted to reflect current interest rates. The length of the fixed-rate period and the frequency of readjustment is made clear in the ARM naming convention. For example, a 5/1 ARM has an initial fixed-rate period of five years, after which the mortgage’s interest rate adjusts every year; similarly, a 3/1 ARM holds a fixed rate for three years, and is then adjusted yearly.

What are the drawbacks of Adjustable Rate Mortgages?
The biggest drawback to ARMs is that they leave borrowers open to rises in interest rates. This means that as interest rates rise, the interest rates on an ARM not in its fixed-rate period will be reset to a higher interest rate, which translates directly into larger monthly mortgage payments. However, the amount by which the interest rates on a loan can be adjusted are often limited each adjustment period by what is known as a “cap.” If the cap on an ARM were set at two percent, for example, the annual adjustment on an ARM currently at 2 percent could not go higher than 4 percent, even if current interest rates for borrowing were around 6 percent. It would not be until the next adjustment period that the interest rate on the loan could be adjusted upward to 6 percent.

Who can benefit from an ARM?
Given current low interest rates, ARMs are the perfect mortgage vehicle for buyers who anticipate staying in their homes for less than five years. The ultra-low interest rates on the fixed-period of the ARM (often up to 1 percent lower than 30-year fixed rates) can save these buyers substantial sums of money over their five years of ownership. Buyers will difficulty qualifying for higher 30-year fixed rates may also benefit from ARM financing, particularly as long as historically-low interest rates continue to be the norm.

ARMs can be complicated to understand, but they are a vital part of the suite of mortgage products offered by most lenders. If you have more questions about ARMs, or just want to find out what sort of mortgage instrument might be right for you, feel free to stop by one of LGI’s new home communities, where we can put you in touch with one of our preferred lenders.

Fall Home Maintenance

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As the warm weather of summer transitions into those crisp days of fall, you may find your mind focused on another season of football, the joys of the coming holidays, and the return of kids to school. But before you yourself get caught up in the throes of autumn’s changes, remember that your home and garden both need to be readied for the upcoming changes, too! To that end, we’ve compiled for you this list of fall home maintenance tasks that will ready your home and landscape for Fall’s quixotic weather.

Preparing for the Winter: Home Maintenance Tips

As a homeowner you will want to regularly perform maintenance checks and address any issues as soon as they occur.

  • Heating. Fall’s downshift in temperature means that you’ll soon be transitioning from the A/C to the heater. Inspect your furnace for any signs of wear or tear, and clean out the filter. You can also hire an HVAC professional to come out and run a tune-up on your system and identify any problems that aren’t immediately obvious. Also, have your chimney cleaned and inspected, to ensure that it is free of debris and venting correctly
  • Gutters. In many areas of the country, Fall means the return of rain or snow, so ensuring that your gutters are clear is a high priority. Gutters clogged with leaves, dirt or animal nests prevent precipitation from running out, and can cause water to pool against the home, damaging your roof or the home’s siding. Clogged gutters can also cause water to spill down and pool against your home, which can cause problems for the foundation.
  • Landscape. Prepare your landscape for the fall by creating a clean and tidy yard that can withstand the rigors of fall and winter weather. Fall is an ideal time to de-thatch and fertilize your lawn, and all perennials (except for roses) should be deadheaded and trimmed back. Remove expiring annuals, amend tired soils, and mulch for cool-weather soil protection.
  • Pipes. For homes in freezing areas, take care that you drain all exterior pipes of water, before the colder weather sets in. Pipes with remnant water, whether a faucet or your irrigation system, can freeze during the winter, causing ruptures in your water lines that may not become apparent until you use the lines again in the spring.
  • Winterize. Finally, cold weather seeping into your home from outside can dramatically raise your heating bills, and leave your household unnecessarily drafty. Winterize your home by checking and replacing worn exterior caulking on windows, and adding weatherstripping to the bottom of exterior doors. In some areas, you may need to rehang storm windows or replace screens with glass. Take time to examine each room for holes, cracks, gaps or drafts; it’s well worth the time, and can save you money and discomfort in the months to come!

Keeping these few steps in mind will help keep your home, whether a new home or a pre-existing home, up to par.