Posted in home repair

Here are pros and cons of home warranties

A few years ago, Jacqueline and Jonathan Sanchez’s furnace kept shutting off. So they called the company that provided their home warranty contract and an HVAC technician came out to troubleshoot. 

Turns out, it was a simple fix: A dusty sensor needed cleaning.

Thanks to their home warranty, the Bellevue, Nebraska couple with two “lively ” kids, only had to pay $100 out of pocket to get their furnace running again. 

“A home warranty helps protect a homeowner from major home system and appliance repair and replacement costs,” explains Tim Meenan, executive director and general counsel for the Service Contract Industry Council in Tallahassee, Florida. He says a typical warranty covers heating, air conditioning, electrical, plumbing systems, and major appliances such as washing machines, dryers, and refrigerators.

If you’re in the market to buy a home, it’s common for sellers to include a one-year home warranty to seal the deal.

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Posted in home

The pros and cons of buying a home without an agent

These days, we’re hearing from a greater number of younger buyers who believe they can handle the home buying experience entirely on their own, with the help of the Internet. Often, these buyers (mistakenly) believe they’ll save money by purchasing a home without an agent, because the seller will only pay a half commission, instead of the full commission.

That just shows ignorance of the process. Sellers who have listed their homes generally pay between 4 percent and 6 percent of the sales prices as a commission to the listing agent. The listing agent, in turn, typically pays the buyer’s broker around half of the total commission. No buyers agent means the listing agent doesn’t have anyone to share in the commission. So, unagented buyers unwittingly allow the listing agent to pocket the entire commission.

Unagented buyers make other mistakes in the process that can cost them money, like not

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Posted in home improvement loans

Cash-out Mortgage Refinancing: Pros and Cons

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Point of Interest

Cash-out refinancing allows you to convert the equity in your home to a lump sum of cash by extending your mortgage. 

A cash-out refinance can help fund major expenses that would otherwise take years of saving. Here are the pros and cons of a cash-out refinance.

A cash-out refinance allows homeowners to use their home equity for immediate access to cash, tax-free! It can be an excellent option for homeowners looking for ways to fund a large purchase like a renovation. 

Historically, refinancing activity picks up when interest rates fall. In response to historically low-interest rates, the average 30-year fixed-rate mortgage has fallen from 3.77% to 3.02% year-over-year (as of July 2020), leading many homeowners to refinance their mortgage. According to CoreLogic, refinance loan originations increased by 59% in 2019.

Interest rates are expected to remain low for the foreseeable future. If you bought your home in

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Posted in home

A Roth IRA may help fund your home purchase. Here are the pros and cons

  • Your direct contributions to a Roth IRA can be withdrawn at any time for any reason.
  • If you meet certain requirements, you can also use up to $10,000 in earnings toward the purchase of a home without facing taxes or penalties.
  • While home prices continue climbing, the cost of borrowing is relatively cheap due to historically low interest rates.

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You probably know a Roth individual retirement account is one way to save for your post-working years. 

It also may come in handy for certain homebuyers.

Basically, up to $10,000 in Roth IRA earnings can be withdrawn — free of both taxes and penalty — for a home purchase if you meet certain requirements. That’s in addition to being allowed to withdraw your direct contributions at any time, because you already paid taxes on that money.

As home prices continue their upward trajectory, the amount of

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Posted in kitchen remodel cost

Kitchen cabinets: The pros and cons of DIY painting, buying Ikea or going custom

When Molly Miller moved into her new house last summer, the kitchen was dark, with black countertops and only one small window. And, “it had beautiful, early 2000s cabinetry,” she says. “The people before us really loved that honey oak. They really loved it.”

She has a friend who repainted her kitchen herself, and thought about giving it a try since she was staying home due to the pandemic. “I started looking into it, and I didn’t think I could do a very good job,” she says. “I didn’t want it to look junky. I wanted it to look professional.”

She hired painters in June, and about a week and $3,000 later, she had bright white cabinets and no more honey-hued oak.

“I love it. No regrets,” says Miller, who lives in the Chicago suburb of Dyer, Indiana. “It looks cleaner, brighter. A new, fresher kitchen will bring me joy

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