How Much Home Can You Afford this Spring?

How Much Home Can You Afford this Spring?

Factors to Consider

house dream(StatePoint) The chicken or the egg? Which came first continues to fuel philosophical debates. But when it comes to buying a home, experts are pretty clear about the proper order of things — agreeing you should fit your mortgage to your finances, not to a house.

“Before you even start your search for a home this spring, it’s crucial to know how much you can afford to pay each month,” says Freddie Mac Senior Vice President, Christina Boyle, who stresses that there are a few important things to keep in mind as you calculate this figure.

Start by getting a handle on your finances. What do you earn? What do you spend? How much do you have in savings? Answering these questions will help you better understand how much home you can afford. Make a budget and use free online tools and calculators to determine how much you can afford.

Remember that your monthly expenses go beyond mortgage payments, so leave some room in your budget. Whether it’s a new roof or a leaking faucet, homeownership can mean unexpected expenses. Be prepared to pay for such items, as needed. General maintenance, combined with utilities (an expense that can vary by home depending on its size and other factors), are added expenses to consider. Some neighborhoods also have homeowners’ association fees to cover the cost of upkeep of common spaces.

Your lifestyle can also help you assess whether a particular home is right for you and your budget. Location is key in determining what you can afford. Some points to consider are whether you want to live in a suburban or urban setting, whether you need to be near specific schools and public transportation, and the potential length of your commute. These factors can affect the cost of a home and you should determine your priorities in advance of home and mortgage hunting.

Remember, getting pre–approved can help you act fast and make a confident offer, so talk to your lender now before you start shopping.

A full rundown on all things home buying, including free tools and resources, is available at

This spring, be sure to prepare yourself for the home buying experience by being well-informed and aware of what you can afford.

Is it time for you to make your move?  Email me at  to get started.

How to Find the Right Home Mortgage So You Don’t Overpay


(StatePoint) Ample bedrooms and bathrooms? Check. A roomy kitchen? Check. A nice-sized backyard, storage space in the attic and just the right amount of curb appeal? Check, check and check.

Once you’ve found your perfect home, the next step is finding the right mortgage — which can sometimes feel like you’re competing in a contact sport, being blindsided by confusing requests or financial surprises as you go through the application process.

According to the U.S. Census Bureau, 63.7 percent of Americans own their home. But getting there wasn’t necessarily easy. A 2017 NerdWallet survey reports that 42 percent of homeowners felt the home-buying process was stressful, a third said it was complicated, and 21 percent found it intimidating.

To help make you a mortgage all-star, Ally Home has created “The Mortgage Playbook,” a free, easy-to-read resource. Authored by members of the Ally Home Team, a dedicated group of loan experts, the “Playbook” features four sections that cover the entire field — from a getting-started game plan to approval and closing on a mortgage. It also breaks down confusing financial terms, helping applicants avoid pain during the home buying process.

To help you prepare for your mortgage game day, here are three top tips from the experts at Ally:

• Maximize your financial fitness. There are five steps consumers should take to improve their “financial fitness” before applying for a mortgage. These include demonstrating stable employment, managing debt, paying down credit accounts, accumulating assets like savings or retirement accounts to boost credit histories, and reviewing (and correcting, if necessary) your credit reports.

• Know your numbers. Borrowers can take advantage of free online tools, such as the Affordability Calculator available at, to determine how much house they can afford. Using two pieces of data — monthly income and monthly debt — a borrower can quickly calculate their debt-to-income ratio. In most instances, this ratio should not exceed 43 percent, meaning your monthly mortgage payment and other debt obligations (car loan, school loan, credit card payments) should not comprise more than 43 percent of your gross monthly income.

• Know what type of mortgage is best for you. One of the biggest decisions borrowers make is whether to get a fixed-rate or adjustable-rate mortgage. When interest rates are low, a fixed-rate mortgage may be the better option. But if interest rates are higher, an adjustable rate mortgage could make sense because its lower initial rate means lower monthly payments for a specific time period (usually five, seven or 10 years) before the rate could change.

For more valuable tips, visit to download the complete “Mortgage Playbook.” This free resource was created by Ally Home, whose mortgage products are offered by Ally Bank, Member FDIC, Equal Housing Lender.

Just like you wouldn’t hit the field without training and preparation, don’t head into the home buying process without the right knowledge. Leverage free resources that can help you be prepared.


Keep Your House Cooler This Summer Without Air Conditioning

In 2017 most of us are making an effort to live a greener lifestyle. We also love to save money! Lisa Kaplan Gordon writing for shares some great tips to keep our house cooler this summer

Want summer comfort but hate the AC? Follow these tips on how to keep your house cool without frosty air conditioning.

You don’t have to switch on the air conditioner to get a big chill this summer.

These tips will help you keep your house cool without AC, which will save energy (and avoid AC wars with your family.

Block That Sun!

When sunlight enters your house, it turns into heat. You’ll keep your house cooler if you reduce solar heat gain by keeping sunlight out. Close the drapes: Line them with light-colored fabric that reflects the sun, and close them during the hottest part of the day. Let them pillow onto the floor to block air movement. Add awnings: Install them on south- and west-facing windows to reduce solar heat gain by up to 77%, says the U.S. Department of Energy. Make your own by tacking up sheets outside your windows and draping the ends over a railing or lawn chair. Install shutters: Interior and exterior shutters not only reduce heat gain and loss, but they also add security and protect against bad weather. Interior shutters with adjustable slats let you control how much sun you let in. Apply high-reflectivity window film: Install energy-saving window films on east- and west-facing windows, which will keep you cool in summer, but let in warming sun in the winter. Mirror-like films are more effective than colored transparent films.

Open Those Windows

Be sure to open windows when the outside temperature is lower than the inside. Cool air helps lower the temps of everything — walls, floors, furniture — that will absorb heat as temps rise, helping inside air say cooler longer. To create cross-ventilation, open windows on opposite sides of the house. Good ventilation helps reduce VOCs and prevents mold.

Fire Up Fans

Portable fans: At night, place fans in open windows to move cool air. In the day, put fans where you feel their cooling breezes (moving air evaporates perspiration and lowers your body temperature). To get extra cool, place glasses or bowls of ice water in front of fans, which will chill the moving air. Ceiling fans: For maximum cooling effect, make sure ceiling fans spin in the direction that pushes air down, rather than sucks it up. Be sure to turn off fans when you’re not in the room, because fan motors give off heat, too. Whole house fans: A whole-house fan ($1,000 to $1,600, including install) exhausts hot inside air out through roof vents. Make sure your windows are open when you run a whole-house fan.

Power Down Appliances

You’ll save money and reduce heat output by turning off appliances you’re not using, particularly your computer and television. Powering down multiple appliances is easier if you connect them to the same power strip. Don’t use heat- and steam-generating appliances — ranges, ovens, washers, dryers — during the hottest part of the day. In fact, take advantage of the heat by drying clothes outside on a line.

Plant Trees and Vines

These green house-coolers shade your home’s exterior and keep sunlight out of windows. Plant them by west-facing walls, where the sun is strongest. Deciduous trees, which leaf out in spring and drop leaves in fall, are best because they provide shade in summer, then let in sun when temperatures drop in autumn. Select trees that are native to your area, which have a better chance of surviving. When planting, determine the height, canopy width, and root spread of the mature tree and plant accordingly. Climbing vines, such as ivy and Virginia creeper, also are good outside insulators. To prevent vine rootlets or tendrils from compromising your siding, grow them on trellises or wires about 6 inches away from the house. Speaking of shade, here are smart, inexpensive ideas for shading your patio. Want more tips for staying cool this summer? Substitute CFL and LED bulbs for hotter incandescent lights. Also, try insulating your garage door to prevent heat buildup.

Visit for more articles like this. Reprinted from with permission of the NATIONAL ASSOCIATION OF REALTORS®.

What do Increasing Interest Rates Mean to Homebuyers and Homeowners

By now you have heard that the Federal Reserve  has increased short term interest rates by 0.25%.  This is the first rate hike since 2006.  It is also predicted that there will be more small interest rate hikes to come.  What does this mean to you as a homebuyer or homeowner?  How will it affect your ability to get a mortgage or to refinance?


As interest rates rise, it will be more difficult for homebuyers to qualify for a mortgage.  This is because lenders look at an applicant’s debt- to-income ratio, the percentage of an applicant’s monthly income that goes to paying debt. As the monthly payment goes up because of higher interest rates, the amount the borrower can borrow for a mortgage goes down. For example:

At 4% interest, a fixed rate 30 year $350,000 mortgage will require a monthly principal and interest payment of $1671.  At 5.5% interest, a fixed rate 30 year $350,000 mortgage will require a monthly principal and interest payment of $1987.  That is a difference of over $300 a month and might disqualify a borrower from qualifying for the loan.  Another way to look at this: if the lender calculated a borrower would be able to pay $1675 a month for principal and interest, at 4% the borrower could borrow $350,000, at 5.5% the borrower could only borrow $295,000.  The borrower would need a larger down payment for the same house or look for a less expensive home.   

These are just examples of what higher interest rates might mean to you.  You can calculate using your own numbers using the Zillow Mortgage Calculator.

Current Homeowners

Fixed Rate Mortgages

If you are holding a fixed rate mortgage, your rate will not change.  This rate was locked in when you closed on your home and will stay the same for the life of your mortgage.  If you decide to refinance or buy a new home though  you will probably see a higher interest rate.

Adjustable Rate Mortgages

If you have an adjustable rate mortgage (ARM) you need to ask yourself how long you plan on staying in your current home.  If you are thinking about staying for more than a few years, you might want to  look into refinancing  your ARM into a fixed rate mortgage.  Start shopping around now to find the best mortgage for you .  Keep in mind not only the interest rate but also fees and other costs associated with the new mortgage.

Home Equity Line of Credit

Adjustable rate home equity line of credit (HELOC) borrowers will be among the first to feel the interest rate increases as these loans typically adjust interest rates monthly.  If you are using this type of credit, you might want to speak to your lender about converting your HELOC into a fixed rate home equity loan.  You also might be able to include your HELOC balance if you are refinancing your primary mortgage.


To give you an idea of what refinancing would mean to you, look at the Zillow Refinance Calculator. This calculator will  help you  estimate the amount of money a refinancing could save you by comparing the details of your current home loan with new rates, terms, and other factors.


Taking the time now  to see how your housing costs will change as interest rates rise could save you a great deal in the short and long term.  It seems as though interest rates  are heading up, so now might be the best time to start your new home  search.  Do you have any questions about buying or selling a home?  Do you  want to know more about the communities of West Essex?  Fill in the form below or email me @ and I will get right back to you.