Archive | September, 2019

What every homeowner should know about their property insurance

24 Sep

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Insurance is required on a home by the mortgage company, but homeowners rely on it for peace of mind also. Unfortunately, people may not take the time to investigate their policy and what it covers until they need to file a claim, which could be too late.

While it may not seem like the best use of your time, an in-depth visit with your property insurance agent once a year could be valuable to you if you have losses and could increase your peace of mind.

The following are some questions you can ask your insurance agent:

  • What is the insured value of the policy and the replacement cost of your home? Insured value is the amount that would be paid for a total loss but replacing the home could cost more than that amount.
  • What is the deductible? Higher deductibles on the first amount of the loss are one way to lower the cost of the premium. It may sound good when you’re having to pay for the policy but feel very different at the time you file a claim.
  • What does the policy cover? Typical policies cover fire, theft, vandalism and storms. Homeowner policies bundle personal belongings and some liability coverage. They can differ not only from company to company but from policy to policy. Be clear on what is covered.
  • What does it not cover? … Some perils are usually not covered by policies like hurricane, flooding, power outage, rising water and earthquake. It can be confusing because a broken pipe might be covered but rising water from backed up sewer is not.
  • What is your anniversary date? … Policies are usually written for one-year and should be renewed before they expire. Mortgage companies like to renew them a month before they expire so there will not be a lapse in coverage. That is why borrowers with escrow accounts for taxes and insurance must fund them accordingly.
  • Is it paid by an escrow account with the mortgage? New homeowners should verify that their house payment includes 1/12th the annual taxes and insurance so they will not be surprised with a large bill when they become due.
  • Does your policy include liability coverage? … This covers claims made by third parties of bodily or property damage done by the insured. It could be as simple as a guest slips and injures themselves in your home. It is important to know the limits of liability and consider larger amounts especially, if you have a higher net worth or risk profile.
  • What is an umbrella policy? – This is a separate policy that increases the liability coverage above the limits of the homeowner’s policy. It can be a relatively inexpensive coverage.
  • Are personal belongings included? … Most homeowners policies include an amount toward personal belongings like furniture, rugs, housewares, and clothes. It may be expressed as a percentage of the overall policy. The question is: will it cover your belongings or does it need to be increased?
  • What is the process to file a claim? … Most claims require proof of purchase or a current inventory of the home. Since most people don’t have receipts except for big ticket items at best, the inventory becomes important. Videos, still pictures or a detailed list can help to satisfy this need. Click here for a digital Home Inventory.
  • Are there additional living expenses included? … Some policies include temporary living expenses if you are displaced from your home.
  • Does a home office require additional insurance? … Many homeowners work from their home and have special equipment that may not be covered normally. If you “meet and greet” people at home, ask about additional liability coverage.
  • Ask about floater policies on big-ticket items? … Some items like jewelry, furs or collectibles need to be scheduled or covered on a separate policy.

Insurance is meant to give you peace of mind against possible losses that could financially harm you without it. Because insurance is very specific about what it does and does not cover, it is important that you have a good understanding of your policy. A policy is a contract between you and the insurance company, and it deserves due consideration.

116 Lansdale Drive, McKinney

20 Sep

116 Lansdale-33

BEAUTIFUL & UPGRADED STUNNER ON GOLF COURSE LOT!

3 Bedroom / 2 Baths / Golf Course Lot
1747 sq ft / Built 2006 / Frisco Schools

CLICK HERE TO VIEW HD TOUR

This gorgeous home boasts an excellent floorplan, gorgeous and extensive updating, outstanding Frisco schools and is nestled on a beautiful golf course lot. Mature landscaping, updated coach lighting and stone accents enhance the elevation of this home and upon entry, your guests will be greeted by a private study with French doors and plantation shutters as well as updated lighting and double crown moldings. The remodeled kitchen would delight any chef with its extensive & painted 42” cabinetry, upgraded granite counters and sleek subway-style backsplash, stainless appliances, additional canned lighting, gas cooktop, walk-in pantry, undermount sink & sunny breakfast area which leads to an expansive family room with a cast stone fireplace with gas logs and entertainment niche.

The Texas-sized master retreat boasts plush & upgraded carpeting, an inspiring golf course view and very nice bath with double sinks, a jetted tub, separate shower and a generously-sized walk-in closet. The other two bedrooms offer flexibility & are served by a full bath. The backyard is excellent for entertaining & relaxing as it offers an
incredible view from both the covered and expanded patio areas and mature landscaping overlooking the golf course. Other fabulous upgrades & features are….recently painted warm & neutral tones throughout (2019), roof replaced (2019), wood fence replaced (2019), separate and spacious utility room, large linen closet in hallway, brushed nickel hardware, sprinkler & security systems, carpet throughout (2019), kitchen updates (2019) & more.  This home is move-in ready and an unbeatable value!

Please contact Jeff  Jacobs at 972.978.6539  for more information or click HERE.

For more information and other homes for sale in this area, check out www.myrealtytown.com 

Want to be a Landlord?

17 Sep

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Real estate has consistently been one of the highest rated investments available to individuals. TV shows certainly make rentals look easy and you may even know someone who has made a lot of money with them. Possibly, the thought has crossed your mind that if they can do it, you can too.

Before you contract for your first investment, ask yourself some questions that could save you time and energy. Not all people have the time, the inclination or even the skill to manage property. Landlords need to be good business people who can maximize revenue and minimize expenses. If investors don’t have the skills and talent to handle some of the repairs, they at least need to know reputable and reasonable service professionals.

Another important element is to be familiar with the state and local landlord tenant laws. You’ll need to know what are allowable security deposits and where the money can be held. Knowing how long you have to return it to a tenant is important and what to do if you plan to keep all or part of it for damages done. It is important to know about the eviction process and how fair housing applies.

If you decide that you may not be cut out for being a landlord, it won’t eliminate investing in rentals. It does mean that you will need to engage a property management company who is capable of dealing with all aspects of the process. The peace of mind and convenience will cost you a fee, usually a percentage of the rent collected. They can handle finding a tenant, doing the background check and writing the lease but there will be an additional fee for that service.

Even though your expenses will be higher with a property manager, with their experience, they should be able to help you lease the property for more money than you can get and will probably have service providers to do the work needed for less.

Occasionally, rental property requires out of pocket expenses for repairs and improvements which is like making another capital contribution. As equity builds in a rental property due to appreciation and principal reduction, the owner does have the option to take cash out of the investment either to pay additional expenses or to use any way the owner wants. Pulling equity out of a rental doesn’t even trigger a taxable event.

Single-family homes and up to four-unit buildings offer an investor the opportunity to get a high loan-to-value mortgage at a fixed interest rate for 30 years on appreciating assets with tax advantages and reasonable control compared to other alternative investments.

Many investors like the fact that you can borrow to purchase a rental investment where many other investments require cash. The use of borrowed funds can create an advantage called leverage. Assume you paid cash for a $100,000 home that generated $7,000 income after the rent was collected and expenses were paid. Divide the value of the home into the income and it would earn 7%.

If you decided to put an $80,000 mortgage on it at 5% interest, the interest expense would be $4,000 leaving only $3,000 income. However, at that point, you’d only have $20,000 invested in the property. Divide the cash invested into the income and the rate of return would increase to 15%.

This is a simple example of leverage showing that borrowed funds can increase an investor’s yield on a property.

Rental property can be an excellent investment when it is treated like the business that it is. Knowledge of the investment will reduce the risk and enhance the opportunity to make a profit. Some investors consider their rental income as “mailbox money” because each month, they go to their mailbox and they have money being sent to them by their tenants. The benefits of rental property can easily outweigh risk involved.

Contact me for more information on rental properties and the option to be the landlord or to delegate it to a property manager.

14665 Holly Leaf Drive, Frisco

13 Sep

14665 Holly Leaf EXT-33

STUNNING ONE-STORY OFFERS AMAZING VALUE AND UPGRADES!

4 Bedroom / 2 Baths / Updated / Frisco ISD

CLICK HERE TO VIEW HD TOUR

This stunning Landstar one-story home boasts stellar updating, a versatile floorplan and an excellent interior location in sought-after Hunters Creek and is just minutes to 121 and walking distance to 3 of Frisco’s very best schools. Mature landscaping enhances the elevation and upon entry, your guests will be greeted by elegant formals with crown moldings, 13-foot ceilings, upgraded chandelier and the formal living could be easily converted to a private study if needed.  The kitchen would delight any chef with its upgraded cabinetry with crown, rich granite counters and island, abundant cabinetry and work areas, breakfast bar, sleek stainless and black appliances, walk-in pantry, sunny breakfast area with window seat and granite planning desk with upgraded cabinetry.

The family room is a generous size and features a decorative gas fireplace with gas logs,  has surround sound for movie nights and leads to a delightful and expanded covered patio with bench seating overlooking a great backyard with a freshly-stained fence with steel supports.  The split and private master retreat has two walk-in closets, a sitting area and window seat and a very nice bath with a separate shower, garden tub, dual sinks, medicine cabinet, stain-grade cabinetry and additional storage area at the top of the master closet. Other outstanding feature and upgrades are, 3 additional bedrooms served by a full bath, epoxy garage flooring, sprinkler system, excellent storage, open floorplan and more! This is a rare and entry level opportunity into Hunters Creek that is one of Frisco’s premier communities with incredible parks, two pool areas, Taychas Trail traversing West Rowlett Creek and community events. This home is priced to sell!

Please contact Jeff  Jacobs at 972.978.6539  for more information or click HERE.

For more information and other homes for sale in this area, check out www.myrealtytown.com 

14822 Holly Leaf Drive, Frisco

13 Sep

14822 Holly Leaf MLS-2

GORGEOUS AND RARE 1.5 STORY LANDSTAR HOME HAS IT ALL!

3 Bedroom / 3 Baths / Media Room / Updated

CLICK HERE TO VIEW HD TOUR

Welcome to Hunters Creek and this beautiful Landstar home with updating, a rare & versatile 1.5 story floorplan on an interior lot within walking distance to 3 of Frisco’s finest schools.  Great curb appeal with lush landscaping, brick and Austin stone elevation highlighted with  painted shutters enhance the elevation of this home & once inside, you are greeted by a gorgeous entryway with rich wood floors, neutral tones, double crown molding, 6” baseboards all in a stacked formal dining and living room – which could be converted into a private study.

This spacious & open floor-plan allows for easy entertaining. The butler’s pantry has 2 built-in wine racks and granite counters with extra cabinet space & an adjoining kitchen that would delight any chef with a custom-painted island, recently painted 42” cabinets with brushed nickel hardware, wainscoting backsplash as well beautiful subway tile behind the gas stove, granite counters.  Other kitchen  highlights are the large walk-in pantry, built-in trash drawer, gas cooktop and cabinets with glass fronts. The kitchen opens up to the sunny breakfast area with a window seat and family room. The family room boasts soaring vaulted ceilings, crown molding, quick start gas fireplace surrounded by granite, wood floors and abundant natural light.  Step out onto your custom-built covered patio with ceiling fan and enjoy the outdoors with plenty of room for your gas grill and grassy area for your pets.

Stepping back inside you will find the master retreat and 2 convenient  bedrooms downstairs.  The large master is split from the other bedrooms, it has recently installed plush carpet, two closets, crown molding & the luxury master bath is a wonderful retreat with a jetted tub, oversized shower with bench, stain-grade split vanities and a linen closet.  The other two
bedrooms are nestled next to the guest bathroom and a large custom built cubbie area with doors, drawers and hooks for storage.  Both bedrooms have custom paint & one has shiplap designer accents. Going up the upgraded wood stairs, you will find a large media room with a custom-built wood platform for stadium seating, several storage cubbies, two that have
electricity for equipment & included in the media room are the screen, Optima projector, and the Onkyo speakers which are wired for surround sound. Also upstairs is a study niche with French doors and a full bathroom. This stunning home has it all, including a short walk to several scenic green spaces in the community as well as parks, trails and pools.  Welcome home!

Please contact Julee Williams at 972.567.2468 or Jeff  Jacobs at 972.978.6539  for more information or click HERE.

For more information and other homes for sale in this area, check out www.myrealtytown.com 

Money You Saved for a Down Payment

10 Sep

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Occasionally, buyers who can qualify to purchase a home decide to “take a break” and wait to purchase a home. When the focus of buying a home is relaxed, other uses for the money that was going to be used for the home are considered.

Maybe they think how much fun it would be to have a Sea Doo or a motorcycle or a new car. It is amazing how many people would like to buy a home but either don’t have the down payment, the income or the good credit to make it possible.

Instead of spending the money, consider investing the money for two years until the time is right to buy a home. Let’s look at putting the money in a certificate of deposit that earns 2% or in the stock market that could average a 5% return.

Assume you were purchasing a $295,000 home on a FHA loan with 3.5% down payment. The $10,325 would grow to $10,742 in the CD which isn’t a big increase but at least it is safe and secure, and it will be available when you’re ready.

If the same amount were invested in a safe stock or mutual fund that earned 5%, it would grow to $11,383 in the same two-year period. It earns more but there is more risk involved.

Your Best Investment
CD Stock Market Home
Cash to Invest $10,325 $10,325 $10,325
Wealth Position $10,742 $11,383 $38,871
Profit Taxed as Ordinary Income Long-term capital gains §121 exclusion applies

Alternatively, if you invest the same amount in purchasing a home that appreciates at 3% a year, the equity would be $38,871 two years from now. The dramatic increase is due to leverage, being able to control a large asset with a small amount of cash. The appreciation is based on the purchase price not the down payment.

Another factor is that there is principal reduction with each payment that is made.

Make your own projections with Your Best Investment.

Downsizing is an Alternative

3 Sep

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It is estimated that over 15% of the population in the U.S. are over 65 years of age. With one of the most common fears of seniors being their money will run out early, it is understandable that downsizing may be strategy to meet their goals.

Once the kids are grown, have careers, relationships and get a place of their own, parents find they may not need their “big” home like they did before. In other situations, their lifestyle might have changed, and the house just doesn’t “fit” anymore.

The benefits of a smaller home can include the following:

  • Easier to maintain
  • Lower utilities
  • Lower property taxes
  • Lower insurance
  • More convenient location
  • Single level
  • Possibly more energy efficient
  • Possibly lower maintenance

Like any other big change in life, it is recommended that a person should take their time to consider the possible alternatives and outcomes. Are they going to stay in the same area? What type of property would suit their needs for the future?

The tax-free exclusion allows a homeowner to take up to $250,000 of gain for single taxpayers and up to $500,000 for married taxpayers. Part or all of this could be used to generate income for retirement. Other uses for the equity could include paying off other debt, taking the trip of a lifetime or making a special gift.

There will be expenses involved in selling a home as well as the purchase of a new home. These will lower the amount of net proceeds you’ll have to invest in the new home.

Homeowners should consult their tax professionals to see how this applies to their situation. Please contact me at (972) 978-6539 or jeff if you have any questions about what your home is worth or how long it might take to sell it. Other things that could be of value are our Homeowners Tax Guide or Sellers Guide.

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