Cost vs. Value

You’ve lived in your home a little while and you think you sort of understand how it should flow. You’re starting to see the warts and little bits of rough that people tend to gloss over when the neighbors pop by to borrow the lawnmower. It’s not that these things make your home flawed — all homes are flawed, they’re made from flawed materials, after all — it’s just that your home could be better and like a skilled craftsman, you’re starting to see places where you could bring out greater potential.

But, which projects make the most sense to do first? Will any of them actually pay for themselves in gained home equity, or are these changes things you’ll have to consider sunk costs in your home and investments strictly in your own enjoyment? And furthermore, are there even changes you can make yourself that will be worth the bother? (Check out our downloadable guide for help in determining which projects are best left to the pros!)

Say Hello to Renovation Magazine’s Cost Vs. Value Report

For the past 31 years, Renovation Magazine has been trying to answer these and other questions by performing a national survey about home renovations and the resell values that tended to accompany them. It comes out early in the new year, giving everyone in the industry something to look forward to after the holiday season. The 2018 report was no less exciting than any other year has been, though there were few surprises.

For example, the top returns in 2016 and 2017 came from midrange fiberglass attic insulation, at 116.9 percent and 107.7 percent, respectively. This year, the number one spot went to another small project: upscale garage door replacements, recouping 98.3 percent of the job cost. In fact, this year’s Top 10 is almost entirely made up of smaller, more simple projects, just like the last two years have been, many of them the same projects, just in different slots.

There’s a helpful chart below to show what I mean.

What does this mean? Well, it means two things, especially if you dig deeper into the data. As a national average, the same projects have been worth making the investment in for the last few years and secondly, there are very few things you can do to your home and get the full cost back out.

Your home is like a piggy bank, but it has some sort of containment issue. You put in a dollar, it only manages to hold on to 90 cents. But, you can think of that loss as the price you pay for getting to use all that cool new stuff while you’re there. Maybe that’ll soften the blow a bit.

Ok, So What Bigger Projects Will Help My Home’s Value?

Again, according to the data provided by Remodeling Magazine’s well-respected survey, bigger projects that should get you some attention (and recoup decently on their own costs) this year include:

#4. Adding on a wooden deck. (82.8 percent)
#5. A minor midrange kitchen remodel. (81.1 percent)
#7. Replacing your windows with vinyl thermopanes. (74.3 percent)
#8. Upgrading your bathroom to a universal design. (70.6 percent)
#9. Just upgrading your bathroom, period. (70.1 percent)

You may notice a trend here. Kitchens and bathrooms are a big deal. They’re always a big deal. In fact, for most houses, it’s the kitchen and the bathroom that really sell the house. You can have the best curb appeal possible, but if your bathroom is difficult to use or your kitchen has no cabinets or non-functional work spaces, you put your money in the wrong places.

Curb appeal does matter, otherwise, that garage door and the stone veneer wouldn’t appear in the chart above so many times. People want to buy a nice looking home, which is what your home values are really based on. An appraisal is nothing more than a complicated calculation that determines what an average buyer would give for your house in its current condition in the current market, after all.

When you’re thinking about putting money into your home to increase the equity you hold or to improve its value for a sale down the line, just ask yourself if the thing you’re about to do is something that a random person off the street could appreciate. For example, do not paint your ceiling blood red. No matter what HDTV says. Do paint an accent wall red if you really need to paint something.

How Do I Get Started on Bigger Projects?

If you’ve never been part of a larger remodeling project, you will most definitely need the guidance of a pro, at minimum. There’s a lot of planning and a whole box of tools (both literal and metaphorical) that it takes to put together an effort like that. After all, you want your project to look like it does in your mind’s eye, don’t you?

The New Personal Assistant...

Having a personal assistant is great. You have someone to set your appointments, find directions to your next meeting, even order a pizza for you. If you have the right kind of assistant, they’ll even turn on your television, open the shades, adjust the thermostat and turn on the lights. Once in a while they may think you’re asking for “pickled gallows” when you’re trying to have them add “pico de gallo” to your shopping list, but all and all, they’re pretty helpful.

There are at least nine ways that a smart assistant can make your life easier — we know because we put that many in our freebie companion download. Check it out while you’re here.

Personal assistants are so helpful that, according to our friends at Pew Research, 46 percent of Americans today take advantage of digital voice assistants like Alexa, Google Assistant and Siri. And why not? They work cheap, they don’t ask for bathroom breaks and they can make life a whole lot easier one little voice command at a time.

But which is the one to have? Who is properly suited to your smart home configuration?

Breaking It Down: Alexa, Google Assistant and Siri

The best minds of tech and business have put Alexa, Google Assistant and Siri head-to-head and each came back with the same results. There is no clear winner in the digital assistant world. There are some things that Alexa does phenomenally that Siri can’t and vice versa. Often, the best digital assistant is the one you like the most or that fits into your budget best.

So, instead of wasting your time with yet another face-off, let’s just talk about what each brings to the table so you can decide for yourself what you really want your digital assistant to do. Sound fair?

Alexa: Great for Shopping, Smart Home, Helping Out

Alexa wasn’t the first voice assistant, but she was the first to have smart home capability in mind, so it’s no surprise that she’s a big winner when it comes to integration with everything from light bulbs to home security systems and even those smart ovens and refrigerators. Alexa has 15,000 skills that you can enable, giving her the ability to do just about anything you can imagine.

Since she’s linked to Amazon’s massive shopping database, she’s also great at helping you find deals on items you may be interested in, reordering supplies you buy on the regular and keeping track of your shopping lists. A few clicks in the Alexa app gives her access to your Google calendar, allowing her to add or recite the day’s events.

As an added bonus, the standard Amazon Echo is a solid speaker for music or audio books. There’s even a second generation model available with a device hub already integrated to make connecting smart home devices easier. The price point on these two devices ranges from $99.99 to $149.99.

Google Assistant: Full of Answers, Gets Your Pizza Right

Google Assistant will work with some of the most popular smart home devices, with more being added all the time, but this isn’t really its bag. Like its parent, Google, Google Assistant is all about finding answers to everything and anything. If that’s the kind of assistant you need, then this is the one you want. Reviewers have proclaimed, hands down, that Google Assistant has the best voice recognition overall (and I can believe this because sometimes I wonder if Alexa needs her hearing checked), which leads to a lot less frustration in general.

Ordering food is a breeze with Google Assistant, provided it supports the food app you’re trying to use. Again, the third party support isn’t as huge as it is for Alexa, but Alexa had a two-year headstart, so in time there may literally be very little difference between the two as far as expandability goes. Google Assistant has a lot of the same features as Alexa, including a morning news briefing.

If you’re all about Google stuff and don’t mind to wait for Google Assistant to catch up to Alexa, the full size speaker has good sound quality and, of course, access to the Google Play store plus streaming services like Spotify for those spur of the moment dance parties. Priced around $129.99 for the standard Google Home speaker, you’ll be able to grow with the Google ecosystem.

Siri: The New Kid on the Block

Siri’s just now moving into the Apple HomePod, so what she’ll be capable of is anyone’s guess. She was finally freed from the confines of the smartphone on February 9, 2018. Now, you need only hand over $349 to Apple and you can have your very own speaker version. Like Google Assistant, Siri can do some smart home stuff, but she’s limited to Apple Homekit compatible devices. Because she grew up inside a telephone, though, she’s still pretty great at connecting you to friends and family, making her an awesome tool for hands-free calling from anywhere in your home.

Apple HomePod does a few things that no other voice assistant enabled speaker can do. First, it requires almost no setup, since it auto-detects where it is in the room by sending out audio blasts and listening for them to bounce back. That’s a pretty slick trick and ideal for anyone who struggles with technology.

Secondly, the folks at Apple have given a lot of thought to security and decided their best response was to untangle your searches from your account. Instead of associating your data with your name, Apple HomePod associates your data with random numbers, then deletes the associated data every six months. That way if the government were to request your data for some reason (like they think you’re the Scranton Strangler), Apple can honestly say they don’t know what data is yours and refuse to comply. This has roots in an old dispute with the federal government over the creation of a backdoor into the iPhone for surveillance purposes.

Make Your Home Smarter, Any Way You Can

Hey, it doesn’t matter which digital home assistant you choose in the end. They’re all going to make your life a lot easier in the end. (Did you download the article about how to get more out of these devices yet?)

Choose the one with the features you’re going to use the most. If you’re an Apple person, go with the HomePod, if you’re all in on Google, Google Assistant is going to just get smarter and better. If you’re a fan of all things Amazon, Alexa’s already pretty mature and has lots to offer a busy person who can’t always make it to the store.

When you’re ready to expand your smart home offerings to include things like security cameras, thermostats or that smart refrigerator, just open up HomeKeepr and you’ll find the right professional to help. They all come recommended, so you know you can trust that they’ll set you up with the right smart home equipment for the job you want to do.

Steve & Jack's March Home News

We are one month closer to spring!!! Apparently, the real estate market has gotten wind of this and has started 2018 with a BANG! We hope you are staying well, which this year, it seems is more of a challenge than ever!

Thank you to all of our friends, clients, and referral partners for attending our monthly Happy Hour last night at Matt The Miller's. We had a great time and always enjoy seeing you. Please join us for our next Happy Hour on March 21st from 5-6:30PM. We are looking for some sponsors this year as well, so if you are looking to get some additional exposure for your business at a very low cost, please let us know. We are filling spots now.

Our biggest and most exciting news is that we have an addition to our family! We are proud to announce that Julia Hayes has joined our team as a buyer/seller specialist. Julia has helped us several times when we have been out of town and has worked in our office for some time. She worked previously for a builder, so she is acutely aware of the building process and will be a great asset to our clients. Julia grew up in Carmel and swam for their record-setting State Championship Girls Swim Team and then also was a scholarship swimmer for IUPUI. Julia brings so much talent to our team and we are excited to have her helping us deliver an even higher level of service to our clients. Julia lives in Fishers and has two children. Please welcome Julia as you connect with her. Her e-mail is Julia@Welcome2Indy.com.

Kylie is simply amazing and keeps our team running so smoothly. She is the most organized person I know and our clients love how she keeps things on track. She is doing well and so are both of her boys, who keep her busy while not at work.

Jack and Mary Anne are doing great and we are so proud to announce that Mary Anne's knee replacement surgery was a complete success! She is recovering well and has exceeded all of her PT goals. She is walking around pain-free, but still has more work to do on healing before she is back to 100%. She would appreciate any continued thoughts and prayers.

Steve & Brigid are keeping busy, as usual. Brigid is very busy with work, not only doing pharmaceutical sales, but also is her region data analyst for her regional manager, which takes her out of town more often and adds quite a bit to her workload. She enjoys it and the opportunities it is providing. Ana and Tali are both doing great in school. Ana is enjoying singing in the Indianapolis Children's Choir and preparing for their next concert in March. She is also preparing for her 3-week European Tour this summer and has to learn 17-songs on which she is diligently working! Tali has continued to excel in gymnastics with several first-place finishes and is looking forward to going to her first out-of-town meet next weekend. We are all looking forward to a short vacation to Disney leaving today. A little sun and fun will go a long way!

The market is white hot right now with inventory at an all-time low. If you or someone you care about are thinking about moving, please call us. There is a lot of information we can share to educate you about your options, so you make the best decision possible. Check out the January stats from MIBOR comparing January 2018 to January 2017:

New Listings-2,483 units-DOWN 3.8%
Pending Sales-2,216 units-UP 3.1%
Closed Sales-1,901 units-UP 5.3%
Median Sales Price-$158,000-UP 10%
Average Sales Price-$192,732-UP 5.6%
Percent of Original List Price Received at Sale-94.7%-UP 1.3%
Total Active Listings Available at Month End-7,070 units-DOWN 18.4%!!!
Months Supply of Inventory/Absorption Rate-2.3 months-DOWN 20.7%!!!

Look at those last two lines above. Those are HUGE declines in inventory. We need more! Now is the time to sell before interest rates continue to go up. They have increased 50-basis points since January to 4.687%, the fastest increase since January 2006.

Thank you to all of our clients for your reviews on Angie's List!!! We have once again been honored for the 3rd consecutive year as a Super Service Award winner. We have also been honored for the 5th consecutive year as a 5-Star Real Estate Agent. Those are both the Top 5% of agents in the city. Thank you for your reviews and your trust and confidence in us. We will continue to work hard to earn it! Be on the lookout for a new referral-reward program for some cool new prizes!! So, send in those referrals. :-)

Do you like to golf? We are Corporate Partners with Heritage Place, which is a not-for-profit organization that services seniors through education and activities. We have been on the planning committee for the golf outing for 3-years now and sponsor a hole as well. We need more golfers! It is at Broadmoor Country Club on Thursday, June 28th and the fun begins at 9:30AM. It is a scramble, so more fun than serious. This is a private course, so if you have wanted to play, now is the time. Please contact me if you would like more information.

Please enjoy this month's newsletter and check out our next Builder Video Series video. Good info!

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Your Friends in Real Estate,

Steve, Jack, Kylie, & Julia

Flooring options...

Your new house is pretty awesome, otherwise you would never have considered buying it. But, there are some things about it that are a lot more awesome than others. Take, for example, that kitchen floor. You wouldn’t say it’s ugly, but you’ve seen better design harmony in a restaurant trash bin.

It’s gotta go.

Your bedroom carpet is pretty hairy, too, but your agent assured you that these things are fairly easy to deal with, especially if you have the flooring replaced before you start moving in. And it’s true, replacing flooring is easy. Choosing the new flooring, well, that’s tough.

Your Flooring Options: A Journey Underfoot

Whether you’ve owned your house for a day, a year or a decade, picking the flooring you’re going to have to live with for a while can be stressful. There are so many materials available and within those, a huge array of colors and designs. It’s the paradox of choice at work, you have so many options you may literally freeze. That’s why we’re going to break it down for you, in hopes that the overwhelm is minimized when your time comes.

Next time you’re in the mood to look at flooring patterns online or in your home improvement stores, here are some things to consider about the most common flooring options available.

Carpet

The fuzzy stand-by for living areas and bedrooms, wall-to-wall carpet has been a popular flooring choice for a century. The materials may have changed, but the basic configuration is the same. All carpets are just a series of fibers woven onto a flexible grid, topping a uniformly thick padding.

When choosing a carpet, look for one with a face weight of at least 30 ounces. These are just above builder grade and should last six to 12 years. Always choose the best mid-grade carpet you can afford, you can’t go wrong that way. It’s where value and durability meet. Don’t skimp on carpet pad, either. Let the carpet shop match a pad to the carpet you’ve chosen so that you get the most life out of them both.

Best places for carpet in your home:
– Bedrooms
– Living rooms (excluding the traffic zones)
– Offices
– Formal living rooms
– Dens
Tile

Today’s tile comes in a huge range of colors, shapes, sizes and materials, but it all shares one thing in common: it’s nearly indestructible when installed properly and should be considered a permanent decision. It’s not that you can’t untile your entryway, but it’s going to be a difficult job, so take this decision carefully and skip the trendy stuff.

There are several grades of tile, but in general, they’re divided into two camps: wall tile and floor tile. While you can use floor tile on the wall with the right adhesive and a lot of patience, you should never use wall tile on the floor. It’s simply not hard enough and will end up cracking or otherwise failing.

The other major consideration is your floor. Is it a perfectly smooth, flat floor, or does it have some minor bumps and ridges? Even minor settling needs to be kept in mind when you’re choosing a tile size. Small tiles are far more forgiving of uneven floors than huge tiles. When a tile doesn’t make full contact with the mortar bed, it will come loose, then others will follow.

Popping tiles can become a major problem in older homes that are built on crawl spaces or basements, and although there’s a certain amount of compensation offered by cement board, it’s just better to hedge your bets by choosing smaller tiles.

Best places for tile in your home:
– High traffic areas
– Kitchens
– Bathrooms
– Dining rooms
– Mudrooms
– Laundry rooms
– Sunrooms
Wood

Wood floors are timeless and sturdy, and these days, come in both solid wood and engineered formats. Solid wood floors will give you a floor that’s more or less just like those floors of yesteryear, completely seamless and total class all the way. Many people choose prefinished wood floors to make installation easier, but unfinished wood floors are still available and make a vibrant, albeit expensive, statement.

Engineered wood floors, on the other hand, are made from layers of wood and plywood. They look just like finished solid wood floors, but are not as durable overall. Most people won’t be able to tell the difference, however, and engineered wood floors can perform better than solid wood floors in wet places, so you’ll just have to strike a balance between your needs and the materials that are available.

Best places for wood flooring in your home:
– Living room
– Bedroom
– Dining room
– Staircases
– Entryways
– Offices
– Kitchens (engineered, with proper precautions)
Laminate

Laminate flooring is a very durable, flexible and affordable hard surface for all sorts of homes and situations. Like engineered wood flooring, it consists of several layers of material, including a clear wear layer, a design layer that can simulate wood, stone and a variety of other patterns, an inner core that provides the majority of the structural stability of the product and a backing layer that helps to protect from warpage.

Unlike a wood floor, laminate floors are installed without glue or nails, which is why some people still refer to them as “floating floors.” They don’t actually float, but walking on one for the first time can be interesting if you’re very sensitive to that sort of thing (many of them are also very slick, just something to keep in mind). Because the material is designed as tongue and groove boards, everything fits tightly as your jigsaw puzzle of a floor is constructed. When it’s done, all that’s required to hold it in place is properly installed trim.

It’s an easy floor. In fact, this is one flooring option you might even want to DIY if you’re the handy type.

Best places for laminate flooring in your home:
– Living room
– Bedrooms
– Bathrooms (choose one that’s water resistant)
– Kitchen
– Foyer
– Office
– Pretty much anywhere
Vinyl

It wasn’t that long ago that vinyl flooring meant tired patterns on reliable, but boring sheet material that had to be painstakingly glued to the floor. One bubble, one wrong cut, and the whole install might be ruined. Today’s vinyl is anything but fussy, with sturdier and more attractive tiles, planks and glue-free sheet goods. Vinyl is also an affordable solution that can be DIYed fairly easily.

It’s naturally water-resistant, making it a great match for basements and places that get damp. Unlike many other types of non-carpet floorings, however, vinyl can be fairly soft, so if you’re putting it in an area like a dining room, you’ll have to take a lot of care not to gouge it when you’re moving chairs under the table. Overall, vinyl provides a good bang for your buck, and since it’s time-tested, you know exactly what you can expect from it: a long, useful life provided you give it the minimal care it needs.

Best places for vinyl flooring in your home:
– Kitchen
– Laundry room
– Basement
– Mudroom
– Foyer
Time to Get Your Flooring On!

The Internet of Things...

Cruising the aisles of your favorite home improvement store, you spot it. Its tall, curvy profile is unmistakable, the glamorous shine of its polished chrome beckons you. The enormous touchscreen asks you if you’d like to order groceries — wait a second…

If you’ve been paying any attention at all, you know that smart home devices are popping up everywhere. From smart refrigerators like the Samsung Family Hub line to connected electric toothbrushes, you can get just about anything you want in a version that’ll report back to your smartphone or network. Heck, there’s even a connected water bottle!

Smart Home Devices and the Internet of Things

All those items that live in your house and report back to your smartphone or your hub or maybe even work with your voice assistant, when you consider them together, they make up a part of the Internet of Things. Everything connected to the Internet one way or the other that’s not a desktop, laptop, tablet or smartphone is part of the Internet of Things.

So, your swank SmartTV, your bluetooth-enabled dishwasher, that self-closing garage door, maybe even your security system, they’re all things that are part of the Internet of Things. It’s important to make this differentiation because unlike the other Internet, the Internet of Things has a big problem that is only just now emerging. Security has become a bit of an issue, with smart home devices turning into backdoors into home and business networks.

Older Internet of Things products are the most vulnerable, since it was uncommon for security to be considered in their design. After all, who’s going to hack a coffee maker? It’s not really the coffee pot that’s the end goal, as it turns out, it’s access. Access to a network that can be used against another entity, often without the owner’s knowledge at all. You could be happily percolating a pot of beans while your coffee pot is participating in a denial of service attack against AT&T and never be the wiser. It’s nefarious.

Is a Smart Home Worth the Risk?

Just because your smart home may be at risk right now doesn’t mean it’s not worth having. That would be just like saying your car is at risk of being hit in a parking lot, so you should never go to the market or maybe even never own a car. Smart home technology can improve and enrich lives when applied strategically, but that’s kind of the crux of the issue here. Having a bluetooth-enabled coffee pot is maybe not a strategic smart home item (but then again, maybe it is, you do you).

When you’re looking at smart home devices, there are a few things you should consider:

What is the brand’s commitment to security? If your product is designed to automatically accept new software when it’s available and allows you to change the password at your leisure, these are good signs that the manufacturer is trying to keep their Internet of Things products secure. Since these updates will be one of your primary defenses, they should be given a high level of consideration during a purchase.

Is this a product that should be connected? Sometimes, brands connect items that maybe don’t need to be connected, like that smart toothbrush, or maybe you don’t need them connected, like the smart coffee pot. It’s ok to not buy a connected item when you have a smart home. In fact, if you strategically purchase bluetooth connected items, you’ll minimize your security risk.

Can I secure this device? This may sound silly, but you should take security of these items very seriously. If you don’t feel that you’re capable of securing your new connected products, then arrange for a tech-savvy person to configure your Internet of Things network before you even turn that new buy on.

Tips for Better Internet of Things Security

So, you have that shiny new connected refrigerator and you’re ready to hook it up to the world. Before you do, it’s time to brush up your Internet of Things security! Here are some tips from us.

1. Set up a separate network for your Internet of Things devices. Known as network segmentation, having a separate, dedicated network for your devices will shield your computers and other more traditional hardware from any risk that your smart home could create. It’s always a good move to have a secondary network, anyway, then when visitors come you can give them the password to your guest network instead of your main network.

2. Always, always use a firewall and WPA2 wireless security with your router. Together, the two will give you extra layers of padding from the outside world. If a hacker does get through, it’s not for lack of armor on your side.

3. Use good passwords. A good password is one that doesn’t relate to you in any way, it’s not your birthday or your kid’s name or your dog’s anniversary. It’s numbers, letters, special characters arranged in some way that you can remember, but not so obvious that someone else could guess. Also, make sure you choose a different password for each device on your network. A password vault can help to keep track of all of these names and numbers, in case you ever need to use them again.

Inspecting Your Roof After A Storm...

Depending on where you live, the end of winter means different things. Maybe it’s the anticipation of an explosion of colorful wildflowers, or maybe it’s just a break from all the heavy, wet snow on absolutely everything. Either way, those warming days when winter starts to turn to spring are ideal for checking your roof for damage from the past season’s storms.

You don’t have to be a roofer to do a simple roof inspection on your own home. There are a few common symptoms of a sick roof that can tip you off that you need to get a set of professional eyes on the job.

Safety First: Looking Up or Climbing Up?

Before we go any further, it’s important to stress the safety considerations involved in roof inspections. Walking around on a roof is dangerous business, even if you’re an experienced roofer. This is why roofers often wear harnesses and other types of safety gear. For the purposes of the style of homeowner roof inspections we’re discussing, you’re not going to set foot on the roof — period. No ifs, ands or buts. Instead, you’ll use no more than two handy tools: a pair of binoculars and a tall ladder.

All roof inspections should start on the ground with your eyes and binoculars, you’ll want to be certain that the fascia is intact and in good shape all around your home before you lean an extension ladder against it. If it isn’t, a six foot stepladder is called for. As always, when using any kind of ladder, make sure someone is nearby to help you stabilize it and to call for an ambulance if you were to fall. Ladder work should be considered potentially dangerous, so proceed with care. Use your binoculars whenever possible, save the ladder work for those hard to get to spots.

Sign of Trouble Up North

Now that we have the disclosures out of the way, let’s get to the meat of the thing. Since about 80 percent of the roofs on North American homes are asphalt shingles, that’s what we’re going to focus this roof inspection on. Follow this checklist as you go around your house, completing one whole side before moving to the next.

Ground Check

– Fascia. Begin at the beginning. Check the fascia for signs of rot or water damage, including soft spots, green algae or places where the board is starting to come apart. If the fascia is pulling off of your house, dig deeper and look for rot or damage before proceeding. This may call for expert help.

– Soffit. Your soffit keeps critters out and lets just enough air in for proper ventilation. If screens are torn or vents are blocked, this is a good time to clean them out. If you’ve got other problems, it might be time to replace these work horses.

– Gutters. They’re not really part of the roof, but they’re roof accessories, so make sure your gutters are also looking good while you’re checking the roof. Sagging or signs of separation will warrant further examination.

– Drip Edge. In the space where your shingles stop and the open air begin, there’s a thin strip of metal called the drip edge. It literally does what it says, it moves drips and drops of water from the shingles and away from the fascia. If you have gutters, you may not be able to see this from the ground, but if you can see it, just check that it’s not rusted, bent or broken.

– Shingles. Shingles are pretty cut and dry when it comes to aging and damage. Either they’re torn off, curling up, missing grit or growing moss or they’re more or less ok. The black streaky stuff on your lighter colored roof isn’t anything to worry about, especially if there are big trees over your home. This is just a harmless variety of algae that grows on shingles that aren’t algae-resistant.

– Flashing. Anywhere that your roof joins something else, like a chimney or even creates a valley, there may be metal flashing to protect against leaks. Check that it’s not rusted or oxidizing and that any tar looks like it’s still healthy, not dried out. Rust is rust colored, irregular and almost stone-like, oxidation is white and powdery.

– Vents. There’s not much to know about vents, except that having plenty is great, and fewer isn’t as awesome. However, if you can see them well from the ground, check that they’re not too dented and if they’re the type that rotate, they’re functioning. Dents indicate they’re hail storm survivors and your roof may need to be checked by your insurance company for hail damage.

– Chimney. Since you have your binoculars out, go ahead and check any masonry chimneys you have. Just make sure all the chinking (the filling, if you will, between the bricks) is intact and the bricks are whole and where they should be. If any brick faces are breaking off or the chinking is crumbling, this is cause for concern and a call to a brick mason sooner rather than later.

From the ladder, pretty much everything on the ground list applies in the same fashion. You’ll just be closer and possibly have an easier time discerning the details. Although there are some people who will tell you that you must walk the roof (or at least climb the ladder), the International Association of Certified Home Inspectors seems to think it’s perfectly fine to inspect a roof from the ground to determine if it needs further examination by a roofing expert.

How Often Should You Inspect Your Roof?

If your roof is less than five years old, a quick look now and again, along with a longer exam after a severe storm or high winds, should suffice. Roofs between five and ten years old should definitely be inspected yearly, though more often is obviously better. Any roof older than ten years should be inspected quarterly, along with a professional inspection from a roofing contractor once a year.

It may seem like a lot of hassle, but a compromised roof can damage a lot of other things, too. Along with the insulation in your attic, the sheetrock in your ceiling, your attic-mounted furnace and even the lumber holding that roof over your head could be at risk. It’s a small investment of your time to ensure that your home remains safe and mold-free.

The Debt-to-Income Ratio Explained

As a functioning adult, you know there’s something about debt that you’re supposed to understand at this point in your life, right? Something about not having too much, or maybe not too much in relation to something else… but frankly, this stuff is kind of confusing and some days you’d just rather take your Visa, buy a pizza, have a massage and then take a nap.

Today, though, you’re on a quest. You’ve decided it’s time to stop renting and become a homeowner. You came here to get some really good information on how to do just that… so, let’s put the credit card away and talk about your debt to income ratio and why it matters to your future mortgage.

What is My Debt to Income Ratio?

If you’re not familiar with the term, don’t be shy, it’s one of the most common questions that first time homebuyers have when applying for a mortgage. That’s because there aren’t a lot of places where it’s obvious that your debt to income ratio is being used to determine your ability to get credit. It’s sort of figured out behind the scenes and you’re none the wiser.

At a very basic level, your debt to income ratio is simply what it sounds like, all your long term, semi-permanent debt compared to your current income. Usually your mortgage lender will do this as a monthly comparison to make it easy, but the ratio’s the same whether you compare month to month or year to year. If you have $1,200 a month in debt and $5,000 a month in income, that’s the same as if you had $14,400 in yearly debt and $60,000 in yearly income. Both come out to 24 percent, which is a pretty good debt to income ratio.

But, of course, it can’t be that easy, can it.

What’s Included in a Debt to Income Ratio?

Things that are included in your debt to income ratio are secured loans like a car loan or a boat loan, which are sort of guaranteed by the property that you’ve borrowed the money to purchase; unsecured loans like credit cards and lines of credit; student loans and any debt you’ve co-signed.

Let me repeat that last thing. Any debt you’ve cosigned is part of this figure. So, if you agreed to cosign a loan for your sister 20 years ago and she’s still paying on it, that’s still going to count against you, even though you’ve totally forgotten about it. If you’re on a joint account with your ex-husband, you’re still on the hook when it comes to debt to income.

Things that aren’t included, that are almost always assumed to be, are items like your car insurance, your utility bills, your cable bills, subscriptions and so forth. Basically, if you can cancel the payment at will (whether or not there are serious consequences like having no lights or being able to watch Game of Thrones), it’s probably not going to be included on your credit report unless you fail to pay as agreed. While you’re at it, it might be a good idea to go ahead and get yourself a credit report from a reputable site like MyFICO.com, the Fair Isaac website, just so you can see what is actually reporting.

Adding It All Up

Figuring your debt to income ratio is pretty easy, the hardest part is figuring out what counts and what doesn’t. Just add up your monthly expenses and divide by your monthly gross income, before any taxes, insurance, 401k withdrawal and the like come out. There you go. That’s your debt to income ratio. Now we can do some stuff with it!

There are three major programs that most home buyers utilize across most of the United States. These are the FHA, VA and Conventional mortgages. Each has its own requirements and debt to income ratio ceilings. Some are more complicated than others.

FHA and Front End and Back End Ratios

For FHA, there are two kinds of debt to income ratios to keep in mind. One is called the front-end ratio, the other is, unoriginally, named the back-end ratio. The front-end ratio is only your potential future housing debt; the back-end ratio includes all your debts. With that in mind, the chart below shows how you’d look to an FHA lender as of the writing of this blog.

The first number in the column labeled “Maximum Qualifying Ratios (%)” is the front-end ratio, the second is the back-end ratio. Compensating factors can be thought of as other things you bring to the table to make you into a really awesome borrower. Since you have little to no experience at this mortgage thing, your FHA lender is understandably afraid of your eventually missing a payment in the 30 years you’re going to have a relationship, so they want evidence to show that you’re a stand-up kind of person.



FHA loan debt-to-income guidelines. Source: HUD Handbook 4000.1

Fannie Mae and DTI

Conventional loans are a bit easier. Fannie Mae is the principal agency that guarantees what’s known as a “conventional” or “conforming” loan. Fannie has siblings like Freddie Mac and Ginnie Mae, but they’re at the movies right now and we’re not going to involve them in the conversation. For our purposes, conventional loans are all about Fannie Mae.

In general, conventional loans tend to be more difficult to land, in part because they have more rigid income to debt requirements. For borrowers with credit scores of 680 or better and less than a 25 percent down payment, Fannie won’t allow more than a 36 percent debt to income ratio (but she only uses the one number, so at least it’s not more complicated than that). If your credit score is above 700 and your down payment is less than 25 of the home’s price, she’ll allow a 45 percent debt to income ratio.

When it comes to Fannie, bringing more money to the table will absolutely catch her eye. She believes firmly that all things that glitter are definitely gold. That magic number is 25 percent of the sales price of your home. So, if you’re floating in cash, but have a higher debt to income ratio or a little bit lower credit score, you could win brownie points this way.

Veterans Get More Leeway

If you’re a military vet and you’ve not used your VA mortgage benefits, you may be wondering about cashing in that particular chip. When it comes to the debt to income question, it’s a harder one to answer. Generally speaking, the VA wants to see a debt to income ratio below 41 percent, but like with other qualifiers under VA, the rules aren’t really all that hard and fast.

VA loans tend to be a lot more flexible in general, and debt to income ratios are no exception. Although all the loans mentioned in this blog can be manually underwritten, the guidelines only allow for so much deviation outside the rules. VAs give a lot more wiggle room, so if you’re at a 45 percent debt to income ratio, for example, it might not be out of the question if everything else is in line.

Time to Go Apply What You’ve Learned

Figuring out your debt to income ratio is just one of the very first steps you should take on your path to getting a mortgage. Once you can see how much each of your debts affects your ability to get a home loan, you can either refinance those debts into loans with better terms or work extra hard to pay them down before approaching a mortgage lender.