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What Impacts Your Home Insurance Rate?

Your home insurance rate is determined by a number of factors. Some of the biggest include age and condition.

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We are excited to be joined today by Lindsey Metzger with American Family Insurance to talk about all the different things that impact your home insurance rate and how you can position yourself to get the best rate possible.

One major thing that affects your rate is the age of your home. An older home will have a higher rate than a newly built one. The reason is that there is more risk involved when it comes to insuring older homes. It essentially all comes down to risk.

If you’re looking at an older home, pay special attention to the roof, the wiring, and the plumbing. The older the system is, the more risk is involved for the insurance company and the higher your rate will be. An older home with a new roof would have a lower insurance rate because of that fact.

Another thing that affects your insurance is the material your home is made of. Vinyl siding is more expensive to insure than brick because it’s less fire-resistant. Your credit is super important as well. Not only does it affect your home insurance rate, but it affects your mortgage insurance rate as well.
Having a personal insurance agent will help you avoid unwise claims.

Insurance is a double-edged sword. It’s there for you when you need it, but be careful about submitting a claim for every little thing. Lindsey recommends only making claims on things that are catastrophic. The first time you put in a claim, your home insurance increases by about 8%. Even if insurance doesn’t end up covering it, it will still count as a claim on your record.

This is why Lindsey recommends having your own insurance agent to consult with. They can come out to your home and take a look at the problem to make sure the claim is higher than your deductible and is something that would be covered by insurance. It’s a good resource to have an actual agent rather than just calling an 800 number.

Thanks to Lindsey for joining us today. If you have any questions for her at all, give her a call at (470) 202-7315 or send her an email to lmetzger@amfam.com. If you have any other real estate-related questions for us, don’t hesitate to give us a call or send us an email as well. We look forward to hearing from you soon.

How Do Recent Issues With Appraisals Affect You?

Today I’m joined by senior loan officer John Ragland to go over the issues we’re seeing with the appraisal process lately.

Now, more than ever, it’s so important to choose the right people to do business with. There have been a lot of issues lately with appraisals, so John Ragland with Supreme Lending is with me today to talk a little bit about what’s going on with appraisals.

There was a lender in California who was working on a loan, and they were unable to obtain the appraisal report from the appraiser. The appraiser had the order for almost an entire month and still had not submitted the report to that lender. The buyer was in jeopardy of losing the property because the closing date was fast approaching and the lender was stuck without the appraisal. The buyer contacted us and asked if we could help them do a rush closing in 10 business days. We took that on and actually got the appraisal report in three days.

The key with that has to do with the appraisal management company. After the housing crisis, Fannie Mae changed their guidelines and would not allow lenders or loan officers to choose the appraiser. Part of that was to protect the integrity of the appraisal in making sure there was no bias between the lender and the appraiser, which was a positive thing. However, anytime you add any regulations, there will be some sort of backlash or challenge that has to be overcome.

Fannie Mae’s change took assigning an appraiser out of the loan officer’s hands and turned it over to appraisal management companies. In turn, there are some management companies that have a great relationship with appraisers, some that don’t have a great relationship with appraisers, and some who assign the appraisal to an appraiser who doesn’t have a good reputation and is not reliable.

That’s why it is so important to make sure you work with a mortgage company who has a good reputation in handling the appraisal process. Working with the right company will ensure you close on time, there are no unwanted surprises, and the appraiser that is assigned the appraisal is qualified. Supreme Lending ensures that the appraiser assigned to your property is a local expert and has the commitment to deliver that report by the due date.

One of the most common issues we see is an appraiser being assigned a property they are not in close proximity to, but there are other factors that can contribute to getting an appraisal thrown out. Sometimes appraisers count the square footage incorrectly or mistake certain features of a home. Recently, a listing listed a jacuzzi tub as one of its features and the appraiser took that to mean a hot tub rather than a jacuzzi tub in the master bath. The appraiser actually incorrectly credited $8,000 to the home that ultimately needed to be corrected to show the home’s true value.

Appraisers are very important, and we need them to ensure the buyer is paying a fair price, but it’s important to always make sure that the appraisal is correct.

Another issue in the appraisal world is the shortage of appraisers. Today, the appraisal process is more difficult than ever to complete. There have been so many increased regulations pertaining to what appraisers have to do to obtain an acceptable report. The credentials to be an appraiser are also tighter now than they ever used to be.

Many appraisers are coming to the conclusion that the job isn’t worth the money. In fact, appraisal costs have increased as more regulation requires more from an appraiser, but some have determined that it’s not worth the risk. If something were to happen to a loan and it’s determined that the appraiser did not do their due diligence, the appraiser could be liable. So, we see more appraisers getting out of the business than we see coming in.

The cost to get an appraisal done quickly can cost hundreds of dollars.

Because of the shortage of appraisers, appraisals are taking longer to complete. Getting an appraisal done quickly can cost hundreds of dollars more. That’s why it’s best to start the appraisal process as soon as the buyer is under contract.

If you have any questions for John about the appraisal process or anything else Supreme Lending can help you out with, he can be reached at 770-335-6373. If you have any questions for us, feel free to call us anytime. We'd be happy to help.

How Do You Know Which Agent Is Right to Sell Your House?

If you’re selling your home, it’s crucial that you pick the best agent to represent your interests. How can you know which agent is best for you, though?

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With so many properties expiring out of our MLS, it’s very important to take a look at who you choose to sell your house. After all, when you sign that listing agreement, aren’t you signing it for the promise of results? The longer a house sits on the market, the lower it ultimately sells for.

If getting top dollar is important to you, you’ve got to do your research on the agent you pick to represent you and examine their stats. What are their average days on market? What’s their average list price to sales price? How many price reductions does it take for their listings to get results?

You can tell a lot about an agent’s worth by looking at their stats.

It always amazes me when we see the same property expire time and time again, and the homeowner keeps going back to the same listing agent. As Albert Einstein once said, “The definition of insanity is doing the same thing over and over again expecting different results.” What’s the likelihood that someone who couldn’t get results under their first promise will do any better next time?

In my 17 years of experience in this business, I can tell you that there are two types of agents who cause a listing to expire: the kind who knows what the homeowner needs to do to get results and doesn’t have the guts to communicate that knowledge, and the kind who just doesn’t know what to do. I’m not sure what’s worse.

Here at the Homes By Lorie Team, we’re willing to have those tough conversations and tell homeowners what they need to hear even when the news is not what they want to here. We know the first-hand importance of you getting results. From 2007 to 2011, we helped hundreds of homeowners sell their properties through a short sale because their equity was taken away and they didn’t have the ability to close their property. Many of those properties had been on the market for months (and even years) with other agents. Had those agents been honest and willing to have those hard conversations with their clients about what those properties were going to sell for, those homeowners wouldn’t have needed a short sale.

Your home sale is one of, if not the largest financial transaction you will make in your lifetime. Don’t you deserve the very best?  Don’t be afraid to question an agent on what their results have been on their recent listings. Have them compare their results to what the competition has been in the surrounding neighborhoods. Don’t you deserve to get top dollar per square foot?

If you have any questions about choosing the right agent or are looking to sell your home, please feel free to give us a call so we can strategize with you on taking the best course of action. We look forward to hearing from you!