By Dian Hymer
It's not uncommon for home buyers to talk with several mortgage brokers or lenders to compare loan products and interest rates. One buyer who shopped around was scolded by a mortgage broker when he found out she was talking to more than one broker. He told her that she was ruining her credit score by allowing multiple credit inquiries.
Too many credit inquiries can negatively affect your credit score, but you can control the damage. And, credit inquires make up a relatively small part of your credit score.
For example, the FICO credit score from Fair Isaac Corp. that is widely used by mortgage companies for qualifying borrowers uses five types of information to calculate a credit score. Each type counts as a percentage of the total credit score. They are: payment history (35 percent); amounts owed (30 percent); length of credit history (15 percent); new credit (10 percent); and types of credit in use (10 percent). Credit inquiries fall into the "new credit" category, which accounts for less than 10 percent of your credit score.
Only voluntary inquiries are taken into account, such as the inquiries made at your request when you shop loan rates. Loan agents usually need to know your credit score before they can quote you an interest rate.
The FICO credit-scoring model ignores all mortgage inquiries made within the last 30 days, so they will have no impact on your credit score. An older version of the scoring formula uses a 14-day time span. A newer version uses 45 days. The lender decides which version of the scoring model it wants to use.
There's no need to panic if you don't line up your mortgage in 30 days. The scoring formula looks for mortgage inquiries older than 30 days. It counts all the mortgage inquiries within a certain period, which varies depending on the scoring model used, as one inquiry. For some borrowers, one inquiry might not affect their credit score at all. If it did, it should be less than five points off your score.
Let's say you talked to four lenders during a week in September. You authorized each to check your credit. Then you postponed buying until November, when you shopped rates again within 30 days prior to closing the sale. The most recent credit inquiries wouldn't affect your credit score. The four that were made in September would count as one inquiry.
HOUSE HUNTING TIP: There’s a wide range of rates being quoted. This is a time when it could pay off to shop carefully for the best rate and mortgage product to suit your needs.
For example, one mortgage broker quoted 6.75 percent on a conforming loan (to $417,000) for a 5-year, interest-only, adjustable-rate mortgage (ARM) with no points. (One point -- a loan origination fee -- is equal to 1 percent of the mortgage amount). Another broker offered a 5-year ARM that is fixed for the first five years at 5 7/8 percent with no points. And, this rate was available for loan amounts up to $650,000.
Nonconforming jumbo financing for mortgage amounts over $1 million is still high -- in the 8 to 9 percent range. Some buyers are achieving a lower blended rate by combining a conforming jumbo (to $729,750) with a second loan. Borrowers who have good credit and an established banking relationship with a lender might be able to arrange a preferential rate.
Before you authorize a credit check, find out what kinds of mortgage products a lender offers and provide a brief summary of your financial situation. Try to focus your rate shopping within a 30-day time period.
THE CLOSING: Don't authorize a credit check until you've narrowed your search down to likely prospects.
Tuesday, November 4, 2008
No such thing as a "green" car, but there are "greener" options
By Amy Westervelt
Unless you've been cut off from all forms of media for the last two years, you're aware of the fact that vehicle transportation is a major contributor to climate change. According to the Environmental Protection Agency (EPA), transportation accounts for 29 percent of total greenhouse gas emissions in the United States. Transportation also is the fastest growing source of emissions, accounting for 47 percent of the net increase in total U.S. emissions since 1990. And that's just getting from point A to point B -- the figures don't factor in the emissions created by manufacturing automobiles or refining fuel.
On top of the environmental cost, the price of gas is not likely to come down too terribly much, and even oil companies’ scientists attest to the fact that we are running out of oil. All of which points to a crucial need for better public transportation and vehicles that are both fuel-efficient and low-emission.
Thanks to our collective century-plus love affair with the automobile, U.S. public transportation systems still have a way to go before the majority of people can reliably get where they need to go without a car. Thankfully, from large automotive companies to small start-ups, we're starting to see a number of choices for fuel-efficient, low-emission automobiles, so much so that it can sometimes be confusing to pinpoint the benefits of each and the differences between them. Following, a simple breakdown of energy-efficient, low-emission vehicles:
Hybrids
Hybrids run off both an internal combustion engine and an electric engine with rechargeable battery. The battery is recharged when the car brakes. Because hybrids switch over to electric power at lower speeds, they make the most of gasoline, getting roughly 40 miles to the gallon, depending on the model. While hybrids have been the poster child for the "green" movement over the last few years, in reality they are only slightly better than conventional vehicles. Because they have two engines, the manufacturing emissions associated with hybrids are higher than those associated with conventional cars; furthermore, there are numerous conventional diesel vehicles in the European Union that get up to 70 miles per gallon.
Plug-in Hybrid Electric Vehicles
The next generation of hybrid vehicles, plug-in hybrids (PHEVs) run primarily off the electric engine and use the combustion engine for back-up. Their batteries are larger and more powerful, enabling them to run for longer without recharging. When they do need to be charged, they can be plugged into an electrical outlet. The result is much higher fuel efficiency, and much lower emissions, than a conventional hybrid. However, the electric engine comes with its own suite of environmental issues - first, it plugs into the grid, and "the grid" for most of us, is still powered by coal-fired power plants, which means your car use is still tied to a large amount of pollution. Then there's the manufacture and disposal of batteries. Finally, manufacturers are still working out the kinks of battery technology, which is why we're not likely to see PHEVs on the road until about 2010. By that time, hopefully more of the grid will be powered by sun and wind.
Electric Vehicles
Fully electric vehicles emit nothing when you're driving them, and get a range of about 120 - 200 miles per charge. Their primary environmental impact come from the electricity used to power them - if you're plugged into a coal-fired grid, there are still emissions associated with your drive. However, as more and more states add larger amounts of renewable energy to the grid, the associated emissions will go down. Currently available models are typically fairly high in cost, but more affordable models are coming on line in the next one to two years from Mitsubishi, GM, Ford, Nissan, and California start-up Tesla, which currently sells its high-end roadster, a fully electric high performance sports car. The manufacture and disposal of batteries, however, especially large batteries produced at a scale to supply all the current car drivers, is still problematic for environmentalists.
Biodiesel-fueled Car
Standard diesel engines can be converted to run on biodiesel -- fuel derived from various plants and/or waste oil from restaurants. There are even DIY converter kits that run about $600 (check out greasecar.com). Biodiesel is not a fossil fuel and is more fuel-efficient than conventional diesel, but it still emits greenhouse gases when burned. According to the EPA, biodiesel emits less CO2 and particulate matter than conventional fuels, but more nitrous oxide, which also is a greenhouse gas.
Hydrogen-fueled Cars and Fuel Cells
For a long time, many believed hydrogen fuel cell cars were the wave of the future. Cars that run off hydrogen fuel cells can feasibly run just as well as currently available vehicles, and emit only water, which could be used for other things (and guess what? we're running short on water these days too). However, there are numerous engineering obstacles to overcome with hydrogen - namely infrastructure (building hundreds of stations stocked with high-pressure hydrogen canisters is hard to imagine), cost (as with most new fuels, cost for hydrogen fuel is currently prohibitive), and safety (there are still concerns about how hydrogen fuel cells would react in an accident). However, companies such as BMW are continuing to make strides in these areas, while electric car proponents argue that the emphasis should be on increasing the range of existent battery technology.
Unless you've been cut off from all forms of media for the last two years, you're aware of the fact that vehicle transportation is a major contributor to climate change. According to the Environmental Protection Agency (EPA), transportation accounts for 29 percent of total greenhouse gas emissions in the United States. Transportation also is the fastest growing source of emissions, accounting for 47 percent of the net increase in total U.S. emissions since 1990. And that's just getting from point A to point B -- the figures don't factor in the emissions created by manufacturing automobiles or refining fuel.
On top of the environmental cost, the price of gas is not likely to come down too terribly much, and even oil companies’ scientists attest to the fact that we are running out of oil. All of which points to a crucial need for better public transportation and vehicles that are both fuel-efficient and low-emission.
Thanks to our collective century-plus love affair with the automobile, U.S. public transportation systems still have a way to go before the majority of people can reliably get where they need to go without a car. Thankfully, from large automotive companies to small start-ups, we're starting to see a number of choices for fuel-efficient, low-emission automobiles, so much so that it can sometimes be confusing to pinpoint the benefits of each and the differences between them. Following, a simple breakdown of energy-efficient, low-emission vehicles:
Hybrids
Hybrids run off both an internal combustion engine and an electric engine with rechargeable battery. The battery is recharged when the car brakes. Because hybrids switch over to electric power at lower speeds, they make the most of gasoline, getting roughly 40 miles to the gallon, depending on the model. While hybrids have been the poster child for the "green" movement over the last few years, in reality they are only slightly better than conventional vehicles. Because they have two engines, the manufacturing emissions associated with hybrids are higher than those associated with conventional cars; furthermore, there are numerous conventional diesel vehicles in the European Union that get up to 70 miles per gallon.
Plug-in Hybrid Electric Vehicles
The next generation of hybrid vehicles, plug-in hybrids (PHEVs) run primarily off the electric engine and use the combustion engine for back-up. Their batteries are larger and more powerful, enabling them to run for longer without recharging. When they do need to be charged, they can be plugged into an electrical outlet. The result is much higher fuel efficiency, and much lower emissions, than a conventional hybrid. However, the electric engine comes with its own suite of environmental issues - first, it plugs into the grid, and "the grid" for most of us, is still powered by coal-fired power plants, which means your car use is still tied to a large amount of pollution. Then there's the manufacture and disposal of batteries. Finally, manufacturers are still working out the kinks of battery technology, which is why we're not likely to see PHEVs on the road until about 2010. By that time, hopefully more of the grid will be powered by sun and wind.
Electric Vehicles
Fully electric vehicles emit nothing when you're driving them, and get a range of about 120 - 200 miles per charge. Their primary environmental impact come from the electricity used to power them - if you're plugged into a coal-fired grid, there are still emissions associated with your drive. However, as more and more states add larger amounts of renewable energy to the grid, the associated emissions will go down. Currently available models are typically fairly high in cost, but more affordable models are coming on line in the next one to two years from Mitsubishi, GM, Ford, Nissan, and California start-up Tesla, which currently sells its high-end roadster, a fully electric high performance sports car. The manufacture and disposal of batteries, however, especially large batteries produced at a scale to supply all the current car drivers, is still problematic for environmentalists.
Biodiesel-fueled Car
Standard diesel engines can be converted to run on biodiesel -- fuel derived from various plants and/or waste oil from restaurants. There are even DIY converter kits that run about $600 (check out greasecar.com). Biodiesel is not a fossil fuel and is more fuel-efficient than conventional diesel, but it still emits greenhouse gases when burned. According to the EPA, biodiesel emits less CO2 and particulate matter than conventional fuels, but more nitrous oxide, which also is a greenhouse gas.
Hydrogen-fueled Cars and Fuel Cells
For a long time, many believed hydrogen fuel cell cars were the wave of the future. Cars that run off hydrogen fuel cells can feasibly run just as well as currently available vehicles, and emit only water, which could be used for other things (and guess what? we're running short on water these days too). However, there are numerous engineering obstacles to overcome with hydrogen - namely infrastructure (building hundreds of stations stocked with high-pressure hydrogen canisters is hard to imagine), cost (as with most new fuels, cost for hydrogen fuel is currently prohibitive), and safety (there are still concerns about how hydrogen fuel cells would react in an accident). However, companies such as BMW are continuing to make strides in these areas, while electric car proponents argue that the emphasis should be on increasing the range of existent battery technology.
Power tools make house painting a cinch
By Paul Bianchina
A sure-fire way to make your home look better, prolong the life of your siding and add resale value all at once is to give the exterior a fresh coat of paint. But with a contractor paint job running in the thousands of dollars, you may be considering undertaking the task on your own this summer. If so, here are some tips and a couple of new tools from Wagner that will help you get the job done quickly with professional results.
Proper Preparation
Proper preparation of the siding is absolutely essential to a good-quality, long-lasting paint job. Loose and peeling paint must be removed first and the edges of the remaining paint feathered down to create a smooth surface for the next coat. Painting over old paint that is not well-adhered is pretty much a guarantee that the new paint job will fail. There is no way around this less-than-enjoyable task, so just resign yourself to it.
But while you can't avoid it, you can make it a little easier by using the proper tools. One new tool you might want to consider is Wagner's PaintEater ($74.99). The PaintEater is a hand-held electric tool that is somewhat similar to a disc sander, but instead of using sandpaper, it uses a 3M disc made from spun fiber. The fiber disc is aggressive in removing paint, but its unique design prevents the old paint from clogging up the sanding surface, so you get a lot more work done without constantly replacing the paper.
The PaintEater removes loose paint quickly, and will also feather down the edges of the remaining paint for a better, smoother surface. It can be used on wood, masonry and cement, but be aware that the rotary motion and aggressive paint-removal disc make it unsuitable for siding shingles or textured siding.
In addition to a tool such as the PaintEater, you'll also need a hand scraper and a sander to take care of the corners and the hard to reach areas. With any of these tools, be sure to wear eye protection to shield your eyes from flying paint chips -- which can be surprisingly sharp and dangerous -- as well as a dust mask or respirator to protect you against inhaling the dust.
When you're done with the scraping, the bare surfaces need to be primed to protect the wood and provide good adhesion for the top coat. Use a good-quality exterior primer that's compatible with your top coat, and apply one or two coats on all bare surfaces.
When preparing the siding on an older home, you need to be very aware of the possibility of lead paint. Even if the home has been repainted with latex, one or more of the underlying layers may contain lead. For more information about testing for and removing lead paint, contact the Environmental Protection Agency (EPA) online at www.epa.gov/lead, or by phone at 1-800-424-LEAD (424-5323)
Airless Painting
Professional painters rely on airless paint-spraying equipment to apply paint quickly and cleanly with minimal overspray. You can rent a professional-grade airless sprayer, but the occasional user might want to consider investing in Wagner's Paint Crew Plus ($249.99).
Designed with homeowners in mind, the Paint Crew Plus has a 2800 PSI piston pump that's driven by a 1/2-horsepower electric motor, so you have plenty of power for spraying a variety of finishes. The sprayer features a pressure selector that allows you to vary the pressure between 1000 and 2800 PSI, which is very helpful in choosing the best pressure for the finish you're working with. Higher pressures are needed for spraying many of today's exterior latex paints, and you can dial the sprayer down to a lower pressure to give you better control and less overspray when working with thinner materials.
The Paint Crew has wheels and a telescoping handle for easy transport, as well as a 2 1/2-gallon paint hopper that's removable for easier cleaning. You also get a 25-foot high-pressure spray hose, a professional-grade metal spray gun and a reversible spray tip. A convenient hose wrap holds the hose when not in use, and there is a storage area for additional spray tips. Also included is a roller-arm assembly, which attaches to the hose in place of the spray gun, allowing for faster rolling of interior surfaces.
With this or any other type of airless sprayer, NEVER point it at anyone. The high-pressure pumps used with airless sprayers are capable of pushing paint through a person's skin, so be sure you read and understand all of the safety precautions.
A sure-fire way to make your home look better, prolong the life of your siding and add resale value all at once is to give the exterior a fresh coat of paint. But with a contractor paint job running in the thousands of dollars, you may be considering undertaking the task on your own this summer. If so, here are some tips and a couple of new tools from Wagner that will help you get the job done quickly with professional results.
Proper Preparation
Proper preparation of the siding is absolutely essential to a good-quality, long-lasting paint job. Loose and peeling paint must be removed first and the edges of the remaining paint feathered down to create a smooth surface for the next coat. Painting over old paint that is not well-adhered is pretty much a guarantee that the new paint job will fail. There is no way around this less-than-enjoyable task, so just resign yourself to it.
But while you can't avoid it, you can make it a little easier by using the proper tools. One new tool you might want to consider is Wagner's PaintEater ($74.99). The PaintEater is a hand-held electric tool that is somewhat similar to a disc sander, but instead of using sandpaper, it uses a 3M disc made from spun fiber. The fiber disc is aggressive in removing paint, but its unique design prevents the old paint from clogging up the sanding surface, so you get a lot more work done without constantly replacing the paper.
The PaintEater removes loose paint quickly, and will also feather down the edges of the remaining paint for a better, smoother surface. It can be used on wood, masonry and cement, but be aware that the rotary motion and aggressive paint-removal disc make it unsuitable for siding shingles or textured siding.
In addition to a tool such as the PaintEater, you'll also need a hand scraper and a sander to take care of the corners and the hard to reach areas. With any of these tools, be sure to wear eye protection to shield your eyes from flying paint chips -- which can be surprisingly sharp and dangerous -- as well as a dust mask or respirator to protect you against inhaling the dust.
When you're done with the scraping, the bare surfaces need to be primed to protect the wood and provide good adhesion for the top coat. Use a good-quality exterior primer that's compatible with your top coat, and apply one or two coats on all bare surfaces.
When preparing the siding on an older home, you need to be very aware of the possibility of lead paint. Even if the home has been repainted with latex, one or more of the underlying layers may contain lead. For more information about testing for and removing lead paint, contact the Environmental Protection Agency (EPA) online at www.epa.gov/lead, or by phone at 1-800-424-LEAD (424-5323)
Airless Painting
Professional painters rely on airless paint-spraying equipment to apply paint quickly and cleanly with minimal overspray. You can rent a professional-grade airless sprayer, but the occasional user might want to consider investing in Wagner's Paint Crew Plus ($249.99).
Designed with homeowners in mind, the Paint Crew Plus has a 2800 PSI piston pump that's driven by a 1/2-horsepower electric motor, so you have plenty of power for spraying a variety of finishes. The sprayer features a pressure selector that allows you to vary the pressure between 1000 and 2800 PSI, which is very helpful in choosing the best pressure for the finish you're working with. Higher pressures are needed for spraying many of today's exterior latex paints, and you can dial the sprayer down to a lower pressure to give you better control and less overspray when working with thinner materials.
The Paint Crew has wheels and a telescoping handle for easy transport, as well as a 2 1/2-gallon paint hopper that's removable for easier cleaning. You also get a 25-foot high-pressure spray hose, a professional-grade metal spray gun and a reversible spray tip. A convenient hose wrap holds the hose when not in use, and there is a storage area for additional spray tips. Also included is a roller-arm assembly, which attaches to the hose in place of the spray gun, allowing for faster rolling of interior surfaces.
With this or any other type of airless sprayer, NEVER point it at anyone. The high-pressure pumps used with airless sprayers are capable of pushing paint through a person's skin, so be sure you read and understand all of the safety precautions.
Don't wait until selling to make repairs
By Dian Hymer
Home maintenance ranks low on many homeowners' priority lists. When the washing machine breaks, you might fix it to keep from having to go to the Laundromat. But, if there's no pressing need, home maintenance chores are often put off.
In the current soft real estate market, homeowners may be less inclined to pay money to make repairs around the house. However, the key to preserving the value of your home is keeping it in good condition.
Home maintenance is a necessary part of home ownership. The cost varies depending on the age of the home, its overall condition when you buy it and the climate. For example, in coastal California the alternation between fog and blistering sun takes its toll on exterior paint. Houses with a western exposure may need painting more often than those that face east.
Homeowners can have a hard time coming to terms with the fact that they can't recoup the cost of home maintenance when they sell. Home maintenance is a cost of ownership, as are property taxes, homeowners insurance and mortgage expenses.
Even though you can't tally your home maintenance expenses and expect a buyer to reimburse you, you do benefit when you sell by keeping your home well maintained. Buyers tend to pay more for homes that are in top condition, particularly in a buyer's market.
Also, if you don't take care of deferred maintenance, buyers are likely to adjust the price they'll pay for your home accordingly. The burden of making the repairs will be on them, so they will factor this into the cost of the house.
You can cut down on home maintenance by buying a condominium or townhouse in a planned-unit development where the homeowners association dues cover some of these costs. If you rent, your landlord is usually responsible for making repairs.
HOUSE HUNTING TIP: As a homeowner, you can keep your home maintenance costs down by staying on top of correcting minor problems before they become major. For instance, if a threshold is cracked and showing signs of wear, it's best to have it replaced before it causes water damage to the framing underneath. With the escalating cost of lumber, it would be a lot cheaper to replace the threshold now than to repair major water damage later.
Summer is an ideal time to take a serious look at your home in terms of getting it ready for the winter months. Track down leaks in windows, doors, roofs, foundations, drainage systems and basements. Have these and any related damage repaired.
Water is a homeowner's biggest headache. Too much in the wrong place can lead to dry rot, fungus and mold problems that can be very expensive to repair. Ideally, your home should be dry inside underneath the house during the rainy season.
Some homeowners can make repairs themselves. Others have little or no experience, and can't even spot a problem when they see one. If you fall into the latter category, plan to hire a home inspector, contractor or handyman to inspect your home annually for defects that need to be repaired. Many small repairs like installing weather-stripping, sealing French doors or windows, or caulking sinks and tubs can be done by a handyman.
Ask your inspector to prioritize the needed repair items. If you're short of funds, at least take care of the most important items.
Set a schedule for taking care of home maintenance items like having the furnace and fireplace checked, trimming trees and clearing drains.
THE CLOSING: Keep copies of invoices for work performed on your home. It will serve as a good reference for you and for the next owner of your home.
Home maintenance ranks low on many homeowners' priority lists. When the washing machine breaks, you might fix it to keep from having to go to the Laundromat. But, if there's no pressing need, home maintenance chores are often put off.
In the current soft real estate market, homeowners may be less inclined to pay money to make repairs around the house. However, the key to preserving the value of your home is keeping it in good condition.
Home maintenance is a necessary part of home ownership. The cost varies depending on the age of the home, its overall condition when you buy it and the climate. For example, in coastal California the alternation between fog and blistering sun takes its toll on exterior paint. Houses with a western exposure may need painting more often than those that face east.
Homeowners can have a hard time coming to terms with the fact that they can't recoup the cost of home maintenance when they sell. Home maintenance is a cost of ownership, as are property taxes, homeowners insurance and mortgage expenses.
Even though you can't tally your home maintenance expenses and expect a buyer to reimburse you, you do benefit when you sell by keeping your home well maintained. Buyers tend to pay more for homes that are in top condition, particularly in a buyer's market.
Also, if you don't take care of deferred maintenance, buyers are likely to adjust the price they'll pay for your home accordingly. The burden of making the repairs will be on them, so they will factor this into the cost of the house.
You can cut down on home maintenance by buying a condominium or townhouse in a planned-unit development where the homeowners association dues cover some of these costs. If you rent, your landlord is usually responsible for making repairs.
HOUSE HUNTING TIP: As a homeowner, you can keep your home maintenance costs down by staying on top of correcting minor problems before they become major. For instance, if a threshold is cracked and showing signs of wear, it's best to have it replaced before it causes water damage to the framing underneath. With the escalating cost of lumber, it would be a lot cheaper to replace the threshold now than to repair major water damage later.
Summer is an ideal time to take a serious look at your home in terms of getting it ready for the winter months. Track down leaks in windows, doors, roofs, foundations, drainage systems and basements. Have these and any related damage repaired.
Water is a homeowner's biggest headache. Too much in the wrong place can lead to dry rot, fungus and mold problems that can be very expensive to repair. Ideally, your home should be dry inside underneath the house during the rainy season.
Some homeowners can make repairs themselves. Others have little or no experience, and can't even spot a problem when they see one. If you fall into the latter category, plan to hire a home inspector, contractor or handyman to inspect your home annually for defects that need to be repaired. Many small repairs like installing weather-stripping, sealing French doors or windows, or caulking sinks and tubs can be done by a handyman.
Ask your inspector to prioritize the needed repair items. If you're short of funds, at least take care of the most important items.
Set a schedule for taking care of home maintenance items like having the furnace and fireplace checked, trimming trees and clearing drains.
THE CLOSING: Keep copies of invoices for work performed on your home. It will serve as a good reference for you and for the next owner of your home.
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