If you have a mortgage, then chances are you’ve heard the word escrow thrown around a time or two. But what is it exactly?
An escrow account is a helpful tool built into your mortgage. It allows for funds to be collected monthly to pay for your homeowner’s insurance and/or property taxes. By your mortgage collecting escrow, it ensures that your insurance and property taxes are paid in a timely manner. The benefit to you is you don’t have to worry about fronting hundreds or thousands of dollars all at once for your homeowner’s insurance or property taxes.
The formula is typically simple for finding the amount owed. Let’s say both insurance and taxes are escrowed from each monthly payment. The monthly payment is found by taking the total amount paid to both insurance and taxes for the year and then divided by 12. (The 12 is for 12 months.) That’s it! That would be your monthly payment in addition to your mortgage! Please keep in mind, some lenders may use another calculation that varies slightly and is also permitted by the law. Be sure to contact your lender if you have further questions as to how your escrow is calculated.
Occasionally, your escrow payments may increase or decrease. If that happens, either your insurance or taxes have changed. This will affect what you pay monthly. In most loan types, this is the cause of increase or decrease for monthly payments.
All in all, escrow accounts allow for your insurance and property taxes to be paid on your behalf without much extra work on your end!
Security in and for your home can feel like an afterthought. However, practicing smart security can potentially protect your home from burglary. Another aspect of home security is that it can add significant cost to the homebuyer. We’d like to suggest some easy, more affordable options than a security system to help you be safe and save.
There are more ideas than these! Keep researching! These are just to get you started.
Install cameras. This is an easy on trend way to protect your home. While they don’t offer coverage like a security system, thieves can see them and know they’ll be on camera. There are also cameras that you can speak into, so when you see someone trying to take something in your yard or breaking in you can scare them off.
Leave the lights on. If the area around your home is well lit then people trying to break in will likely be seen, also interior lighting being on just makes it look like your home. Don’t leave lamps on, or lights that get very hot. Try the light over the sink on an overhead bedroom light.
Try installing deadbolts. If your mobile home doors don’t have a deadbolt, think about installing one. They are much harder to bust than a typical lock. It’s also a good practice to change the locks at your home if you’ve moved.
Hang blinds/solid curtains. Often times because mobile home window sizes can be unique, blinds are not hung. However, these are a good deterrent from burglary. Blinds and/or solid shades keep people from seeing in, which ultimately keeps them from knowing what’s inside and the layout of things in your home. It also can keep people from knowing if someone is home or not.
Be outside when you’re home. Maintain a presence outside when you are home. This lets neighbors know you are aware and if you are outside often they’ll know you’re probably home often.
Place outdoor items in a locked shed/ garage. People will often try to take trailers or lawn mowers, and items like this because of easy access. Add locks to wherever you keep these items. Be sure to put items away after using them. You can also add motion lights above the entry to scare off people who might try to steal something.
We hope these ideas help you keep your home safe and protect your valuables. It’s always a good idea to get to know your neighbors and offer to keep an eye out when they go on trip and vice versa if you feel comfortable.
The cost of buying a home can be deceiving. You have to have a future mindset as much as possible when buying a home. If you’re stretching your budget just to afford a monthly home loan payment – you probably need to save more before buying. You need to consider more than just the monthly payment when buying a home. If you do not budget for home expenses in addition to the monthly payment, you could possibly end up falling behind on payments or not being able to afford the typical expenses associated with homeownership.
So, as is true with most things – planning, budgeting and education is the best way to prevent future issues! Let’s look at some of the hidden costs of homeownership.
Moving and transport. Buying a mobile home is a great choice. Too often people who are moving their home to a piece of land don’t fully consider the expense of moving and installing the home. This is an expensive process and if the home is not moved and installed properly it can lead to damages and additional expense. Be sure to evaluate all your options such as financing your home delivery and installation costs into your loan amount if permitted by the lender you choose, finding a skilled company to handle your move, and hiring a contractor who can prep your land for a home, water, and electrical.
Utilities. You may be familiar with paying monthly utilities as part of monthly rent. However, as a home owner, the utility accounts will now be in your name. That means you are responsible for paying the entire monthly bill. So before moving in it is always wise to ask the previous owner or a neighbor what they typically pay in the winter and summer for utilities. This will help you to budget for utilities as part of your monthly expenses.
Repairs. Every home requires maintenance and repairs over time even with a new home or a home that is in great shape. It’s good to save each month toward a home repair and maintenance fund knowing that repairs will eventually be needed. The cost of repairs from ordinary wear and tear will add to your expenses, but saving as you go should help keep you covered.
City/ County taxes. As a homeowner you are responsible for paying local property taxes. Property tax payments are something homebuyers often forget to consider because they are usually paid as part of a mortgage escrow payment – which most people never quite understand. Here’s our explanation of escrow to help you out.
Trash/recycling services. Whether you are living in the city or a suburb, you’ll probably have some sort of trash service which you will have to pay for as part of your local property taxes or as a separate bill. Even if you do not have a trash service because you live in a rural area far from a city, you’d probably rather pay someone and hire a service to come get your trash instead of having to make frequent trips to the dump yourself.
Potential lot rent. If you live in a mobile home park and own your home but not the land it is on, lot rent is an extra monthly payment that will need to be considered and budgeted for.
Shopping for a mortgage lender can be a bit intimidating but if you know what to look for and the right questions to ask, you can find a mortgage lender and a loan program that are a good fit for you. When we began our own search for our first home purchase we picked the first lender that was recommended to us. I wish I would have felt empowered to shop around. There are so many options and you should find the one that best fits you – not just make a choice you feel you have to make or are told to.
Let’s look at how you can search for a lender and get the information you need as well as get your questions answered.
Start with people you trust. Ask friends, mentors, parents for help as to what lenders they may be familiar with and who they would recommend you choose. Press into their good experiences and find out the most important things on your must have list. It may be an interest rate you’re looking for, a particular loan type you may be eligible for, or a local lender.
Get a basis for where you are at. Know your credit score, income, what you have in savings etc. This information will be helpful to know when you’re asking questions of potential lenders and you’ll definitely need it for pre-approvals or pre-qualifications. Using a mortgage calculator that takes your information into consideration can give you a good starting idea of what your monthly payment may be for loan programs that you may qualify for.
Contact 3 lenders. This is the number suggested by the Consumer Financial Protection Bureau. You are welcome to contact more or less, but this is a good average. Inquire with some lenders and tell them your situation and ask what they could offer. If you apply with them, lenders will pull your credit report to help them give you the most accurate read of what they may be able to offer. But if you’re not ready yet, you don’t have to apply to ask them your questions.
Make a list of pros and cons and find your best lender. Draw out a comparison chart and see how things line up. Choose a lender that listened to your concerns, answered your questions and was willing to work with you to find the best loan program for you.
Take your time in choosing a lender. Be empowered and find what options there are for you. The loan you get matters and you should enter homeownership feeling like you made the right choice.
Manufactured Homes, the Next Big Thing in a Housing Crisis?
These days the cost of living is expensive. So expensive in fact, we are experiencing a record low number of millennials buying homes! According to Urban.org, only 37% as of 2015.1 The Reason? Buying a house is expensive, but it doesn’t have to be.
The average cost for a new traditional stick-built home with land according to the U.S. Census Bureau, costs $376,000 as of March 2019.2 The average cost as of December 2018 according to the U.S. Census Bureau, for a new double wide without land was $106,000 and $52,100 for a new single wide without land.3 That is a huge difference! The other option? Renting. Don’t get me wrong, renting has it perks, but when it’s time to plant your roots, it just isn’t ideal.
The biggest drawback to renting is that you do not have the potential to build equity. A manufactured home, however, can potentially be a good investment particularly if the home is permanently affixed to land. When renting, the monthly rental payment becomes a permanent monthly expense as long as you rent. A mortgage, however, has an end date. If it is within your budget, you can also make extra payments toward paying off your mortgage loan ahead of schedule to eliminate having a monthly mortgage payment even sooner. I don’t know about you, but my mortgage is my biggest expense each month.
If you are an animal person like I am, remember that your home is your pet’s home too! Owning a home means you have more freedom with how many pets you can have. It is not uncommon for rental agreements to either not permit or limit the number of pets you may have in your rental home. Rental agreements may also limit the breed, size, or weight of dogs. When looking to move to Tennessee, it was hard to find a rental to live in that would permit my cuddly 84-pound Rottweiler Lab mix. This also meant we didn’t have a yard for her to go run and play in. While it meant fun trips to the dog park, it also meant standing in the cold rain for bathroom breaks. We were also always perpetually worried the owners would decide one day they didn’t want to rent to pet owners. Now, Sadie has a nice fenced in yard since buying our own home.
Rentals also limit your ability to make your home feel like your own. Rentals deter you from putting holes in the walls for hanging pictures, updating or remodeling, even painting. Home ownership offers all those freedoms. The sky is the limit for what weekend project you’ll find yourself getting into, whether it is a bathroom remodel or planting a garden. Plus, what’s the point of watching all those home improvement shows if you can’t utilize your inspiration from them?
With this all being said, buying a home can be expensive, unless you know what to look for. So, what is stopping you from purchasing a manufactured home? They are more popular now than ever, and for a great reason. They provide the same features you are looking for in a traditional stick-built but cost less! Just imagine, sitting on your front porch sipping your sweet tea or coffee as you rock in your rocking chair, owning your own home for less than you expected.
Many people try to predict the lifespan of a manufactured home. While some estimates can be accurate, it’s good to consider them through a wide lens. Some claim a manufactured home has a lifespan of 30 – 55 years. While this can be true, there are many factors to evaluate: Is it a pre-1976 mobile home? When was it built? What materials were used? Has it been kept up? Where is it located? Is it exposed to harsh weather? The list goes on. So while 30-55 years could be an average for many homes, it’s not fair to generalize about the lifespan of any particular manufactured home without evaluating many other factors.
It is better to focus on ways to increase the longevity of your home instead of accepting a timeline that may not even be accurate. Let’s look at how to best care for your home.
Keep it dry! Water can damage all homes. Manufactured homes are no different. Water damage that is left untreated can deteriorate your home over time and significantly shorten its lifespan. Be careful of ceilings and floors. Covering ceilings with paint is not a fix. Don’t ignore dampness. Deal with it as quickly as possible. We’ll help you reduce moisture in your home!
It’s vital to ensure that your home is placed and installed according to the manufacturer’s specifications. Be sure to use a licensed manufactured home installer and other trusted professionals. These professionals take the soil conditions into consideration, along with drainage, and just being sure that your home is properly prepped and installed. Knowing if your home is being installed properly can be hard when you’re not aware of the process yourself. Be sure to ask questions. Making sure your home is placed and installed properly can add years to its life.
Over time your home can settle. This settling often results in your home becoming uneven. Re-leveling your home can be done by a professional. Traditionally, if you have a pier and beam system – they measure the height of the beams and raise the home to the level that it needs to be at. This correction may prevent cracks in the walls and other structural damage which could shorten the lifespan of your manufactured home.
Manufactured home roofs are important to protect. Some types of roofing need to be coated yearly. While other types may need to be inspected periodically for problem areas. It’s important to know the kind of roof you have and care for it accordingly. Read here for more about repairing your manufactured roof.
You know those home improvement shows where the person gets their home totally renovated for free? That’s the dream, right? For the rest of us though, we need a practical alternative. Say you want to add a fire pit to your backyard, update your kitchen cabinets, or install new doors throughout your entire home. All of these are great ideas and can add some serious flair to your home for years to come. Yet, most of us simply cannot afford to do these things without putting together a financial plan to pay for the improvements.
Planning for the expense of a home improvement project is a little different even if you are already budgeting for expenses. So, how can you plan to pay for an improvement sooner instead of later? Time to jump in!
Set the budget. Do your research to get a good estimate on the cost of materials, labor, and future maintenance. If you want to cut some cost and you have the ability and knowledge about how to complete the project, save the cost of labor and do it yourself. Search the internet and talk to people at your local home improvement store to find out more about your project and decide if it is something that you should tackle yourself, or if you need to hire a professional.
Save 10 percent more than your budget number. There are always unexpected additional project expenses. Plan for it and your plan can go off without a hitch.
Skim off the top. Ideally, with every paycheck you can set aside an amount that you are comfortable with that will be used for your project. This requires you to know how much of your paycheck you need for everyday expenses and bills. So if you don’t budget, wait until all of your expenses and bills are paid and then transfer part of what is left over from your paycheck to savings.
Cut or reduce unnecessary expenses for a few months. Whether it’s coffee, classes, or some other non-necessity – stop paying for it for a bit and put the money you saved toward your project budget.
Thrift/scrap/used parts. Look at discount stores for parts you need for your project that may cost less than at other stores. Keep your eyes on local garage sales and and scrap yards for pieces you can use. You may also already have something you could re-purpose to fit the task as well. Think creatively and you can cut some of your cost.
If you are receiving a tax refund, use part or all of it toward your project. This is always helpful.
Ask for it. Is your birthday soon? Mother’s day? Father’s day? You get the point. Ask for part of your project budget as a gift if people ask you what you’d like. Revamping your kitchen? Ask for a bit of back splash. Materials adds up when gifted or donated in smaller quantities and as a bonus friends or family know they are giving you something you’ll both use and enjoy.
We hope these ideas help you make your next project happen! Depending on how much your project will cost and how quickly you can save, we suggest planning on saving for at least 6 months to a year for your project. This may not always be enough time to save, but it should be enough time if you utilize as many of our saving strategies as possible.
New homeowners need a lot of items to keep up with home maintenance and to save on things they can labor themselves. The upfront cost can be a lot on a new buyer. Consider saving up for each item and purchasing as you have funds and as it’s needed. As warmer weather is coming, we think about our yards and the help they need to stay kept. Let’s look at some items that will help you conquer your yard!
Garden hose. This is a must for cleaning driveways, watering plants/landscaping, and with the proper attachments – cleaning your vinyl siding. Plus, it’s great, cheap fun for those long summer days at home for the kiddos!
Rain garden/ long drain spouts. It’s quite important to be sure your yard drains well. Especially if your mobile home is not on a permanent foundation. If you notice pooling in your yard or slushy spots after rain consider redistribution ideas. Rain gardens use rocks and or absorbent plants to keep your yard healthy. Long drain spouts carry water farther from your home and foundation to keep puddles at a minimum.
Lawn mower. This one is obvious. It’s so much cheaper in the long run to mow your own yard than to pay someone.
Hedge shears. These handy little gadgets are good for all the in-between work. Keep your landscaping under control and deal with little issues in a snap! Operate carefully and use safety precautions.
Rake. Whether your yard is covered in leaves or sticks you really can’t clear your yard without a rake. Leaving all that debris in your yard is bad for it, too.
Solar powered path lights. These are a lifesaver, especially if you live in a rural setting. From getting home, to spending time outside, to friends visiting. These lights can guide your cars safely to your home.
Skirting guard. If you’re weed eating or moving near your skirting, you need a skirting guard to protect your siding from holes and dings. Torn skirting is bad news for your home as critters and cold/warm air has direct access to piping.
Weed eater. These are great for those annoying, hard to reach areas, edging, and carefully maneuvering around landscaping. Please follow all safety instructions and familiarize yourself with the machine.
As you spend more time in your home you’ll realize other items you need. You may also start to do gardening which will require some extras. Please be sure to use all tools with care, learn how to use them, ask a trusted individual to help with tools you’ve never used. Safety first!
Buying a home is a great privilege. Quite often the joys of homeownership are expressed, and while these should not be undermined, they should not overshadow the responsibilities that follow. Owning a home is work. Anything we invest in requires attention and maintenance. Sometimes this transition from renting to ownership can cause a shock. We want to alleviate that shock.
Let’s look at some of the items that a homeowner will be responsible for.
Change air filters
Cleaning: floors, bathrooms, surfaces, deep clean appliances
Change light bulbs
Interior maintenance as a homeowner is not much different from renting but the importance of it is stressed. When renting you may not care about deep cleaning, or sweeping weekly because it’s not your home, not your investment. However, when the home is yours and your inheriting the mess – these items matter a lot more. Stay up on these and they are quite simple.
Lawn care is usually a big shift for new homeowners. Where you may have someone who did the work regularly that your landlord paid or you just did work when it got bad – now you have to take care of your yard. It’s also important to make sure your yard is safe and usable for guests, kids, and pets.
Maintaining your exterior can really give you great curb appeal. Pressure washing your siding makes it look brand new, and skirting without holes looks super sleek. Since mobile homes are often times not on a permanent foundation a sump pump is highly advised to reduce or prevent flooding. It’s also advisable to coat your mobile home roof.
One of the hard things about owning is you can’t leave it there for the landlord to fix. You have to fix and it’s usually in your best interest to do it quickly. This can sometimes be a financial hardship, that’s why we stress saving past a down payment, because the habit will help you as homeowner. Most of these issues are not do it on your own unless you are versed in the issue professionally. Otherwise, expect to find a repair person to diagnose and fix the issue, plus someone will need to be home while the work is being done usually.