Archives for September 2016

By Joe Szabo, Scottsdale Real Estate Team Recently, negative headlines have appeared about how banks “cross-sell” you additional products and services. But cross-selling isn’t always bad for consumers — and, in fact, when it comes to mortgage cross-selling, there are some compelling benefits. Here’s a look at what cross-selling is, and how to know when it can help or hurt your finances.

What is cross-selling?

Cross-selling is when your financial services provider sells you a new product or service beyond the one you have or are asking about. This can happen when you’re an existing customer, like when your monthly mortgage statement includes a promotion for a new credit card. Or it can happen when you’re a new customer, like when you’re applying for a mortgage and you’re asked if you’d like to open a checking account from which to auto-debit the monthly mortgage payments.

How cross-selling works

Cross-selling is a basic sales premise we encounter often in our daily lives. If your waiter offers a wine selection to go with your entree, that’s cross-selling. If your automated gas pump asks if you’d like a car wash, that’s cross-selling. And if your banker asks you if you’d like overdraft protection to go with your checking account, that’s also cross-selling. The difference with financial services is that the products are more complex, and the fine print associated with each offering can lead to unwanted fees and/or products. Overdraft protection is a great example. If a transaction will overdraw your checking account, overdraft protection enables the bank to draw funds from another account to cover the overage. Cue the bank representative: “Don’t have another checking account? Let’s open one for you right now!” In this scenario, you’d then be asked to sign or verbally consent to terms and conditions for the new account. Before doing so, you must press your banker to explain:

• Low-balance thresholds and fees for both accounts
• Overdraft transfer fees
• Other possible fees
• Conditions that bundle other products with the one being offered
• Conditions that permit the bank to add other products without obtaining new consent from you

Best practice is to never agree verbally, and instead ask for full terms and conditions in writing before you agree. It’s less convenient, but it will help you avoid unnecessary fees, unwanted products, or both.

Mortgage-related cross-selling

The good news with mortgages is that strict laws prevent you from going forward with a loan application until you receive and sign very clear mortgage disclosures detailing the rate, loan terms, line-item fees, and cash needed to close. But you will still be subject to cross-selling in the mortgage process. Here are some facts about the most common mortgage cross-selling practices. These can help you determine whether mortgage cross-selling actually benefits you, and which questions to ask to make sure.

• Lower mortgage rate with checking account. If you open a checking account from which the the monthly mortgage payment must be be auto-debited, many lenders will offer a lower mortgage rate. Opening a checking account to save interest cost over the life of a mortgage can be worth it, if the rate discount is good enough. Make sure you understand low-balance thresholds and fees on the checking account, and double check whether your mortgage rate can rise if you decide to cancel the checking account
• Lower mortgage rate for larger deposits. If you move money into new deposit or asset management accounts before you close your mortgage, many lenders will offer a lower mortgage rate — but how much lower depends on how much money you move to (or already have with) the bank. Your loan officer will tell you the rate discounts associated with different deposit levels. Ask if you can combine this discount with the checking discount noted above. Also, double check whether your mortgage rate can rise if your deposit/asset account balances ever go below the threshold that was required for the rate discount.
• Portion of credit card spending pays down mortgage. If you open a credit card, some lenders will credit a certain percentage (often around one percent) of annual spending toward paying down your mortgage. As with all credit card products, there is a lot of fine print, so if your loan officer offers this option to you, ask to review everything in writing before agreeing. If it’s a fit for you, it can be a nice incentive for credit card spending you’re already engaged in.
• Open a home equity line of credit (HELOC) with your mortgage. HELOCs are a convenient way to access your home’s equity. They’re a second mortgage, and you can put one in place with a zero balance, and use a credit card or check to spend the funds when needed. You only make payments if you establish a balance, and the rate can be variable or fixed. Ask your loan officer to document rate options, as well as fees to open and close a HELOC. Also, note that having a HELOC can make it more difficult to refinance your first mortgage down the road — but this depends on each person’s profile, so ask your loan officer to explain this to you.

And finally, once you’ve established whether a mortgage cross-sell product is appropriate for you, it’s good practice to ask your loan officer whether they get paid on the non-mortgage products. It will help you gauge whether they’re doing the right thing for you — or the right thing for them. Please note that this Scottsdale Real Estate Blog is for informational purposes and not intended to take the place of a licensed Scottsdale Real Estate Agent. The Szabo Group offers first class real estate services to clients in the Scottsdale Greater Phoenix Metropolitan Area in the buying and selling of Luxury homes in Arizona. Award winning Realtors and Re/MAX top producers and best real estate agent for Luxury Homes in Scottsdale, The Szabo group delivers experience, knowledge, dedication and proven results. Contact Joe Szabo at 480.688.2020, info@ScottsdaleRealEstateTeam.com or visit www.scottsdalerealestateteam.com to find out more about Scottsdale Homes for Sale and Estates for Sale in Scottsdale and to search the Scottsdale MLS for Scottsdale Home Listings.

By Joe Szabo, Scottsdale Real Estate Team It’s standard practice in real estate to give a home a fresh coat of paint before putting it on the market. Nine out of 10 times, the intention is to show the property at its best. But every so often, the seller paints the house in hopes of covering something up. In most parts of the country, sellers (and agents) are required to document any known defects —  whether current or past — to potential buyers. But some sellers don’t play by the rules and will try to get one past a buyer. Whether you’re a listing a home for sale or in the market to purchase, here are five things you should know about real estate disclosures.

What is a disclosure?

Disclosure statements, which can come in a variety of forms, are the buyer’s opportunity to learn as much as they can about the property and the seller’s experience in it. Potential seller disclosures range from knowledge of leaky windows to work done without the benefit of a permit, to information about a major construction or development project nearby. Not only do disclosure documents serve to inform buyers, but they can also protect the sellers from future legal action. It is the seller’s chance to reveal anything that can negatively affect the value, usefulness or enjoyment of the property.

How does a seller make a disclosure?

Disclosure laws vary from state to state, even down to the city and county level. California has some of the most stringent disclosure requirements. The law requires that sellers (and their agents) complete or sign off on dozens of documents, such as a Natural Hazards Disclosure Statement, Local and State Transfer Disclosure Statements, Advisories about Market Conditions and even Megan’s Law Disclosures. Disclosure typically comes in the form of boilerplate documents (put together by the local or state real estate association), where the seller answers a series of yes/no questions about their home and their experience there. Additionally, sellers must present any documented communication (between neighbors, previous owners, the seller or the agents) about a substantial defect or item that could have an adverse impact on value. Depending on where you live, sellers can be on the hook for what they disclose (or fail to) for up to 10 years. Sellers should err on the side of caution. If you know it, put it out there. If you try to hide something, it can come back to haunt you in the form of an expensive lawsuit.

What do sellers disclose to potential buyers?

Previous improvements, renovations or upgrades done by sellers are typical disclosures, as well as whether work was done with or without permits. Buyers should cross check the seller’s disclosures with the city building permit and zoning reports. Work completed without a permit, or approval by the municipality, may not have been performed to code, which could result in a fire or health hazard. Other standard disclosures include the existence of pets, termite problems, neighborhood nuisances, any history of property line disputes, and defects or malfunctions with major systems or appliances. Disclosure documents often ask sellers if they are involved in bankruptcy proceedings, if there any liens on the property, and so on.

Is a disclosure the same as an inspection?

Disclosure is something given to the buyer by the seller documenting their knowledge of the property. It is not the same thing as an independent inspection by a third party. An examination may reveal defects that the seller may not have been aware of. The buyer should always do a full property inspection, before moving forward with the purchase. The inspector checks all systems and components from the roof to the basement. Often, in the interest of the ultimate in full disclosure, a seller hires a property inspector before going on the market and supplies the written report to the buyer.

When does the buyer receive disclosure statements?

In most markets, disclosure documents are provided to buyers once the seller has accepted their offer. In addition to their inspections or loan contingency, the buyer has an opportunity to review the seller’s disclosures. If the buyer discovers something negative about the property through disclosure, she can usually back out. In some markets, sellers provide these disclosures to the customers before an offer. Smart sellers let buyers know everything they need to know up front. It’s smart because it saves everyone time, hassle and expense by preventing deals from falling apart once they’re in escrow. Buyers must sign off on all disclosures and reports. So it’s important to review them carefully and ask questions if you need to. Full disclosure upfront is the way to go. Providing full disclosure can help a seller. By laying their cards out, sellers can give buyers a sense of comfort or peace of mind, making their home more desirable than a competing one. Please note that this Scottsdale Real Estate Blog is for informational purposes and not intended to take the place of a licensed Scottsdale Real Estate Agent. The Szabo Group offers first class real estate services to clients in the Scottsdale Greater Phoenix Metropolitan Area in the buying and selling of Luxury homes in Arizona. Award winning Realtors and Re/MAX top producers and best real estate agent for Luxury Homes in Scottsdale, The Szabo group delivers experience, knowledge, dedication and proven results. Contact Joe Szabo at 480.688.2020, info@ScottsdaleRealEstateTeam.com or visit www.scottsdalerealestateteam.com to find out more about Scottsdale Homes for Sale and Estates for Sale in Scottsdale and to search the Scottsdale MLS for Scottsdale Home Listings.

By Joe Szabo, Scottsdale Real Estate Team Have you ever asked yourself: “How much living space do I really need?” “A lot of people now, I think, are realizing that what it takes to live is different than what we’ve been told we need to live. And that’s an amazing epiphany,” says Charlie Kern, a Denver-based builder who designs homes made of old buses. Kern, who has been working with old buses for 10 years, was able to solve a personal financial problem with his knowledge about these automobiles. “I needed a place to live,” Kern recalls. “I wasn’t going to have the money to buy a house in the foreseeable future. I knew buses. This is a lot of space. I knew I could live in one.” Kern spent around $27,000 remodeling an old bus into a home, complete with full kitchen, bathroom, and Murphy bed. The bus operates and functions fully as a home, with gas, water, and electric. Thinking about his own carbon footprint, Kern decided while building the bus that he would cut off the roof and put solar panels in its place. As for his water supply, the bus has a 46-gallon tank, which can last him about a week with showers, washing dishes, and cooking.

Sharing the bus life

Now that his home is complete, Kern spends a lot of time building house buses for other people. “We definitely build for people that are unique. They’re creative. They think outside the bus, and fundamentally they’re adventurers,” Kern says. In addition to being an inexpensive and green way to live, Kern says the biggest thing about living in a house bus is the freedom that comes along with it. “I love knowing that from where I am I could walk five or six feet, sit down in the driver’s seat, start the bus up and start driving,” Kern says. Please note that this Scottsdale Real Estate Blog is for informational purposes and not intended to take the place of a licensed Scottsdale Real Estate Agent. The Szabo Group offers first class real estate services to clients in the Scottsdale Greater Phoenix Metropolitan Area in the buying and selling of Luxury homes in Arizona. Award winning Realtors and Re/MAX top producers and best real estate agent for Luxury Homes in Scottsdale, The Szabo group delivers experience, knowledge, dedication and proven results. Contact Joe Szabo at 480.688.2020, info@ScottsdaleRealEstateTeam.com or visit www.scottsdalerealestateteam.com to find out more about Scottsdale Homes for Sale and Estates for Sale in Scottsdale and to search the Scottsdale MLS for Scottsdale Home Listings.

By Joe Szabo, Scottsdale Real Estate Team Over the years, Tarek and I have bought a lot of houses, and we’ve seen every nightmare possible. From vandalism to faulty foundations — and even cement mix in the toilets — we’ve somehow made it through all of our house flips without going completely nuts or losing our shirts in the process. From all of our crazy experiences, I’ve learned that there are a lot of things that can set you back when you’re buying and flipping houses, but most of them aren’t going to be deal breakers — if you do your research and plan your rehabs right. With that said, if you’re buying a house for yourself or you’re worried about a tight rehab budget for a fix-and-flip house, there are definitely a few things you should look out for, and many of the big ones are in the kitchen. Some of these problems can be deal breakers and leave you wishing you had waited for a different property.

Water damage

Water damage is an important thing to look for in any room of the house, especially in the basement and ground floor, as previous evidence of flooding can foretell some serious woes down the road. However, in the kitchen, water damage isn’t necessarily just a sign of flooding and potential problems if you get a rainy season. In fact, when you see water damage in the kitchen, pay attention. This could indicate a problem with the plumbing, like a cracked or leaky pipe or sink. Even if the owners swear that they had the cause of the water damage taken care of, you’ll want to take a really good look. Have your inspector or contractor give it a once-over to ensure that you aren’t going to be looking at more extensive repairs down the road. Even if the cause of the water damage has been addressed, there’s still a chance that the damage could be deeper and more expensive than you think, especially if there’s water damage to the floor. Have an objective pro look at it for you, and see what they say before you move forward.

Asbestos pipes

Back in the day, asbestos was used to insulate pipes and keep them from freezing in the winter. If asbestos hasn’t started to break down, it isn’t that dangerous. But because any house you find with asbestos pipes is going to be older, you can expect the asbestos to start breaking down in the near future, even if it isn’t now. Worse yet, if you have kids who like to get into everything (like mine!), you’ll have to worry about them getting in contact with the asbestos, as well. In general, unless a house is an absolute steal with a lot of room in the rehab budget for improvements, I try to avoid any property that has any asbestos insulation. If you see it on the pipes leading to the kitchen sink, you might want to rethink this deal.

Cabinetry problems

Kitchen cabinets can be a problem in many different ways. The most obvious is if the kitchen’s cabinets are rotted and need to be replaced. If you’re planning on putting some work into the house and you’re looking forward to some fixer-upper time, then this definitely isn’t a deal breaker. However, you might want to use it as leverage to bring down the seller on the asking price. After all, if you have to spend money to replace the cabinets, the house obviously isn’t up to its full market value. Another of the woes that can come with kitchen cabinets is their shape and size. I’ve walked into houses with cabinets that looked absolutely beautiful, but when I opened them, I was in for a rude awakening. They were so shallow that I didn’t think a full-sized plate could even fit in them, let alone a serving platter or anything larger. Sometimes, to make a small kitchen look bigger, a designer will try to maximize space by installing shallow cabinets. This is a pretty awful trick, if you ask me. So always be sure to check out the actual height, width, and depth of the cabinets before you buy. Chances are the seller won’t lower the price on the house just because you don’t like the size of relatively new cabinets that are in good shape. However, you can see if there’s room in your budget to get cabinets installed that will be better for your needs.

Cheap flooring

This is not the worst thing you could find, especially if you’re planning on renovating the house after you buy it. But if you walk in and see cheap linoleum flooring, you’ll have some real work cut out for you with the house if you buy it. Cheap flooring can be really expensive to pull up and redo. It’s a good idea to know exactly what you’re getting into with renovations if you go that route.

Hassles vs. hazards

If you’re going to buy a fixer-upper, most of these things won’t be huge problems, especially if you’re planning on doing a lot of renovations. However, water damage and asbestos pipes are issues that you absolutely have to deal with to prevent injuries, illness, and/or major damage to the house that will cost a lot more money later on. The other things I’ve mentioned here are really just hassles that can be fixed later if you plan your budget right. However, if you notice more than one of them, take some time to think about how much a full kitchen renovation is going to cost, and see if you can get the seller to come down on the price to cover some of the cost. Please note that this Scottsdale Real Estate Blog is for informational purposes and not intended to take the place of a licensed Scottsdale Real Estate Agent. The Szabo Group offers first class real estate services to clients in the Scottsdale Greater Phoenix Metropolitan Area in the buying and selling of Luxury homes in Arizona. Award winning Realtors and Re/MAX top producers and best real estate agent for Luxury Homes in Scottsdale, The Szabo group delivers experience, knowledge, dedication and proven results. Contact Joe Szabo at 480.688.2020, info@ScottsdaleRealEstateTeam.com or visit www.scottsdalerealestateteam.com to find out more about Scottsdale Homes for Sale and Estates for Sale in Scottsdale and to search the Scottsdale MLS for Scottsdale Home Listings.

By Joe Szabo, Scottsdale Real Estate Team So you’ve fallen for a house that has great bones, but some off-putting 20-year-old design. Not to worry — giving a home a modern update isn’t as hard as it sounds. In fact, it can feel like playing detective, in which your mission is to spot the key culprits. To get you inspired, we tapped Tharon Anderson, a New York-based interior designer with residential projects in Boston and Westchester, to reveal how she worked some serious magic on a desperately dated home in Scarsdale, NY.

Powder room

“There’s really no reason to have tile on the wall in a powder room,” Anderson says. “It’s not like there’s a lot of moisture there.” The color of the tile was also a problem. “It had a very creamy base that was sort of an off-white, which felt really dated,” she says. The over-the-sink lighting and lack of storage made what should have felt like a welcoming space look more like a rental unit. In the updated room, the bright white details of the textured wallpaper and funky mirror frame are like a breath of fresh air. And the cabinet space? Talk about functional.

But perhaps the best part of the new look is the sconces. “We had space to the sides of the vanity, so putting the sconces there makes the room feel wider,” Anderson says. It’s also more flattering. “Placing the fixtures above the mirror puts emphasis on the height of the room,” throwing shadows on the face, she says. Placing them to the left and the right of the mirror makes it seem larger. Swapping the old brass faucet for a shinier unit in copper didn’t hurt, either.

Kitchen

“I generally tell people to spend money on their kitchens and bathrooms first,” says Anderson, noting that these rooms tend to look the most dated because of appliances. They’re also where homeowners get the most resale value, so “having them updated is paramount.” While the original kitchen might appeal to some, the 30-something couple wasn’t in love with the light pine wood cabinets or homespun backsplash. The appliances, however, would stay put. Since the bones of the kitchen, including the location of the appliances and plumbing, were fine, the challenge was to fix what was left. Anderson kept the existing countertops but replaced the existing backsplash with an inexpensive, bright-white subway tile that runs all the way up behind the hood.

With exposed shelving currently in vogue, Anderson decided to knock out a few cabinets to make room for three shelves. “From a function standpoint, I’d recommend putting things on there that you use regularly, like plates and bowls,” she advises. “Anything that sits there is just going to collect dust.”

Perhaps the most noticeable difference, however, is the addition of sleek pendant lamps above the counter. These can help anchor a space, act as decoration, and offer another layer of light, Anderson says. The third is especially useful in kitchens, where “you want overhead light for tasks, under-the-cabinet light so you can see counters clearly, and suspended lighting because it gives ambient light.”

Children’s bathroom

Another room, another case of bad tile. The couple disliked the dark wood, and Anderson wasn’t sure what to make of the orange wallpaper accent. Then there were the countertops: basic and brown. “We tried several options to stick with it, and it just wasn’t worth it,” the designer says. Again, bright-white paint and thoughtfully placed sconces came to the rescue. “We added a double fixture and single ones on either side, which does a lot,” Anderson says. “It’s only one more bulb, but lowering the sconces” makes a world of difference. On the ceiling, replacing the semi-flush mount light with a flush mount light with scalloped petals adds a touch of whimsy. Then there are the little things, like choosing floor tile with just a hint of seafoam green to match the paint color on the wall, and adding a leopard-print-covered pelmet box to the window for more detail. It’s a children’s room, and this feels more fun.

Dining room

“That’s a weird light fixture to have in a dining room,” Anderson says of the ceiling light. “It’s not very special.” In addition, the blue paint was top-heavy and the honey-colored floor stain was very ’90s. Both had to go.   Dark-stained floors anchor the renovated dining room, while molding adds visual interest.   First, Anderson stained the floor a darker ebony color and installed a far more eye-catching light fixture to heighten the drama. Adding molding to the bottom half of the wall added another decorative element, while wallpaper — which is making a comeback — took it one step further. Again, bright-white paint freshened up the space. An on-trend ceiling fixture and bold wallpaper finish out the dining room makeover.  

Master bedroom

From the warm, creamy beige walls to the awkwardly placed curtain rod, this room wasn’t reaching its potential. And while the hardwood floors were nice, they weren’t appropriate for a romantic retreat. The room needed to play up its interesting architecture and create a more serene atmosphere. Soft colors and textures create a master bedroom suited to sweet dreams.   To start, Anderson ditched the warm hues, which give off a ’90s vibe. “Blue and seafoam are relaxing,” she says, unlike “reds, pinks and purples, which are more stimulating.” The designer then painted the room a calming, cool blue and chose contrasting gray and white furniture. The addition of soft wool carpet made the space more luxurious. Finally, raising the curtain rod “as high as we could” created the illusion of a much larger window — and a much higher ceiling. Please note that this Scottsdale Real Estate Blog is for informational purposes and not intended to take the place of a licensed Scottsdale Real Estate Agent. The Szabo Group offers first class real estate services to clients in the Scottsdale Greater Phoenix Metropolitan Area in the buying and selling of Luxury homes in Arizona. Award winning Realtors and Re/MAX top producers and best real estate agent for Luxury Homes in Scottsdale, The Szabo group delivers experience, knowledge, dedication and proven results. Contact Joe Szabo at 480.688.2020, info@ScottsdaleRealEstateTeam.com or visit www.scottsdalerealestateteam.com to find out more about Scottsdale Homes for Sale and Estates for Sale in Scottsdale and to search the Scottsdale MLS for Scottsdale Home Listings.

By Joe Szabo, Scottsdale Real Estate Team You’ve sought out all types of storage solutions for your home. You’ve used hooks and bookshelves, storage containers, etageres, and even the tried-and-true tension rod. Now that you’re out of storage options for your home, you’ve turned to the idea of open shelving. What took you so long? It looks fantastic in nearly every room in the house. Yes, even the kitchen. Here are some favorite ways to utilize open shelving as an elegant solution for several rooms in your home.

The kitchen

Kitchens wear this storage solution particularly well. First, remember you don’t need to use open shelving everywhere. This type of storage generally looks best when it’s complemented by cabinets and drawers. Open shelving can serve as an accent above the sink, or as panels to break up rows of mundane cabinetry. Place items you use every day on the open shelves. Storing your morning coffee mug, utensils or dinner plates on open shelving means quicker access for you during your morning rush, and an easier time for your guests to find an extra fork. Make sure to stow the things you reach for more often on the lower shelves, and decorative items toward the top. If you’re worried about dust or dirt, keep the shelving units away from dusty areas like windows or entries, and instead locate them more centrally in the kitchen.

The bathroom

Often a space where extra storage is most valuable, bathrooms are a great place to try out open shelving. Because most bathrooms are designed to be clean, sleek spaces, open shelving helps to reinforce that aesthetic while providing ample storage for your everyday products. While open shelving might not be the best storage solution for everyone (those with kids and curious pets, take heed), it’s a fantastic way to open up your bathroom and elevate the room’s style. Use small corners for square shelving to hold apothecary jars full of cotton balls, cotton swabs, and other bathroom necessities. Instead of art or another mirror, install three long shelves on the wall and place accessories like vases, greenery, pictures, or other trinkets to inspire an energetic morning or a calming bedtime wind-down ritual.

The bedroom

When you’ve run out of closet space and under-the-bed storage options, it’s time to look to the bedroom walls. Favorite ways to use open shelving in the bedroom are directly above the bed in lieu of a headboard, above a vanity or desk, and in a reading corner adjacent to a wingback chair or loveseat. If you opt for open shelving overhead instead of a headboard, make sure you install it at a comfortable height so as not to go bump in the night. Consider installing lighting right below the shelving to provide extra task lighting for late-night reading. By placing the open shelving near statement furniture, you eliminate the need for art or wall mirrors, and instead can use that space for extra storage needs. If you’re feeling adventurous, rustic wood or industrial metal shelving are stunning options.

The dining room

Think of open shelving as a modern alternative to a china cabinet. If you choose to use open shelving in your dining room, take note of a few points.

First, keep everything uniform. If you are displaying your favorite porcelain, make sure the pieces are similar sizes, shapes, and colors.

Second, don’t overcrowd the shelves. Dining rooms are a more formal space than say, the kitchen, so you don’t need to overload your shelves with many different pieces. Instead, choose a row of goods you’d like to display and stick with it. Finally, blend the shelving in with the wall. Making sure the open shelving is flush against the wall keeps the aesthetic clean and streamlined. When in doubt, opt for white shelving. Please note that this Scottsdale Real Estate Blog is for informational purposes and not intended to take the place of a licensed Scottsdale Real Estate Agent. The Szabo Group offers first class real estate services to clients in the Scottsdale Greater Phoenix Metropolitan Area in the buying and selling of Luxury homes in Arizona. Award winning Realtors and Re/MAX top producers and best real estate agent for Luxury Homes in Scottsdale, The Szabo group delivers experience, knowledge, dedication and proven results. Contact Joe Szabo at 480.688.2020, info@ScottsdaleRealEstateTeam.com or visit www.scottsdalerealestateteam.com to find out more about Scottsdale Homes for Sale and Estates for Sale in Scottsdale and to search the Scottsdale MLS for Scottsdale Home Listings.