Michigan Chronicle
Property Is
POWER
with Anthony Kellum
COVID-19:
Can I Still Buy A House 3
Home Exterior Projects That Combine Beauty and Performance
O
ver its 84 years of operation, the Michigan Chronicle has seen crisis before, but we’re resilient, we are survivors just like our readers. As the pandemic affects our community, the Michigan Chronicle is needed now more than ever to provide our readers with access to information that they can trust. Since the beginning of the pandemic the Michigan Chronicle has been actively engaged in informing our readers about everything Covid-19. We are all adapting to a new way of life and need as much information as possible in order to navigate these uncertain times. As states and industries across the country move towards reopening while adhering to COVID-19 guidelines, the housing market is one of many industries that has been greatly impacted by the effects of COVID-19. Information is constantly changing, making it hard for people to know, and trust, the various resources that are available to them. Whether you’re facing job loss, reduced income, illness or other issues that impact your ability to make your monthly mortgage payment, there are programs available to help you stay in your home. If you are struggling to make your mortgage payments or believe you may fall behind on your payments soon, don’t wait, the Michigan Chronicle, in partnership with industry expert, Anthony Kellum, is bringing together a select group of industry experts for the Property is Power Resource Guide, to share tips on how homeowners can best navigate these unprecedented times with information dealing with: • Forbearance • Payment deferment vs. relief and
Empowering the Black community through homeownership is my life’s mission. — Anthony O. Kellum Anthony O. Kellum started his mortgage company from his home in 1994 and now oversees Kellum Mortgage, LLC & Kellum Capital Group, LLC. With over 31 years of experience in Real Estate and Finance Kellum has a true entrepreneurial spirit and is of the philosophy that real estate is the foundation for financial freedom and as the single largest investment Americans will ever make and are the key to creating generational wealth. Kellum was the first African American president of the Michigan Mortgage Brokers Association. He is also the author of an informative, inspiring book titled Property is Power and hosted a television show under the same name. Kellum is on a mission to save the American Dream of Homeownership and speaks & writes on the following topics: Affordable Housing, Revitalization, Entrepreneurship, Access to Credit, and Homeownership the American Dream. Kellum’s commitment has awarded him the following distinctive honors: Crain’s Detroit Business recipient of “40 under 40,” Mortgage Broker of the Year, Martin Luther King Award “Setting The Example,” Michigan Chronicle Men of Excellence, and an Honorary Doctorate Degree in Humane Letter from Lewis College of Business.
Buying Virtually
During a Pandemic Page 5
Should You
• Lending options available • Refinancing advantages during COVID-19
Refinance or Sell?
Page 8
Stay safe! Be well!
7 Steps to Preparefor a
Hiram E. Jackson
Publisher, Michigan Chronicle Chief Executive Officer, Real Times Media 2 Property is POWER | July 2020
Page 7
Home Remodel
Page 11
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Property is POWER | July 2020 3 202082_JULY_MICHIGAN_CHRONICLE_10x10.indd 1
7/15/20 9:58 AM
COVID-19:
Can I Still Buy A House As the U.S. economy continues to struggle and while in the midst of suffering from the Covid-19 pandemic, one market is surprisingly strong ~ the housing market. Low mortgage rates in many U.S. cities has the housing market selling at about the same rate as before the pandemic began. Homes are still selling as quickly and at the asking amount or slightly higher. You may be wondering, how this can be? Well, let us explore. In 2010 & 2011 houses were on the market for a medium of 100 days but today they are on the market on average 23 days in some areas. Furthermore, the percentage of homes selling at or above the asking price has been at 90 percent or more for the last several years. Low mortgage rates, which lets purchasers pay more for a home and still keep their monthly payments manageable, have helped make those prices possible according to Jim Dropps, Realtor (Money, Ingrid Case, May 18, 2020.) If you are looking to take advantage of a hot market, here is what you need to know and do. Be Nimble: • Be prepared to make fast moves. When the market is hot and homes are priced well and fresh, people are moving on them with a swiftness. These homes typically sell in the first weekend or week they are put on the market. Similar to before Covid-19, buyers should 4 Property is POWER | July 2020
look at properties as soon as they hit the market. • Once you make an offer, you should make yourself available for counter offers. The sellers listing agent is not going to wait for you. • Look for lenders who can close quickly…as in seven to 10 days. Also, consider closing virtually and yes, virtual closings are legal in the State of Michigan. Strategic partnerships have made it possible for homebuyers in 15 states – and Michigan is amongst the 15 who are able to close faster due to digital closings in real estate transactions. • Also, a pre inspection can help clear the way to a fast closing if the buyer accepts your offer. Expect Competition: • If you are interested in a property, chances are others are too. This means you may need to make offers on more than one property and yours may just be one of many. Multiple offers are becoming more and more common. They are also more prevalent in homes costing between $200,000 - $400,000 typically in higher demand urban areas opposed to more expensive homes or homes in the suburbs. • Initially, you will not know if there are multiple offers or how they compare, therefore your first offer may not have to be your best.
• Lastly, since you may need to bid higher, stay away from homes that are at the top of your price range. You may need the wiggle room to sweeten the deal on a lesser priced property. Know your maximum price and look at homes priced lower than that price point. Before You Buy, Sell Your Home First: The chances of you winning a multi-buyer competition is better if you don’t still have to sell your home. It can be slightly inconvenient but only for a short time. Sell your home and then move into temporary housing or rent your home from the buyers until you close on your new home if you can. Have Full Pre-Approval on Your Loan: Have your loan pre-approved but not just your average pre-approval. What I mean is you have an underwriter look at your file and give you the go-ahead to move forward with a purchase. With a “pre-underwritten” loan, your financing is much more attractive and since its been through underwriting you are one step ahead and ready to go. Increase Your Earnest Money and Put Down 20%: Offer more earnest money and release it sooner. Also, the more money you put down, the stronger your offer will appear.
Buying Virtually During a Pandemic
T
ypically, most would think the best time to make a big purchase such as a house would be maximized during late summer or early fall, however we are not living in typical times. In an effort to counter the inevitable crippling economic effects of COVID-19, buying your home virtually may be the way to proceed. Basically, lenders have had the technical ability to be paperless over a decade ago however, as the pandemic continues to affect our economy, the real estate industry which was already in the process of slowly adapting to e-closings and e-mortgages is now much more common. For most, todays buying experience has completely gone virtual. There is also a chance you will not even sit down at a closing table, meaning you might sign your documents digitally through e-signatures or you may even have a video chat with a digital notary and finalize your entire transaction online. Exactly how this process plays out depends on the lender. Generally, an online mortgage should allow you to accomplish key tasks like getting rate quotes, filling out an application and providing documents without having to sit down with a loan officer. In some cases, you may not even need to dig up all of the documents yourself. But keep in mind, not every bank or employer has their information online where it is easily accessible. A key factor is obtaining borrower participation and educating borrowers that it is safer than emailing your information. For example, some mortgage companies will electronically access necessary information from government agencies, financial institutions and employers (with your permission, of course). It claims finding all your information online can take days off the closing process. Though with some online mortgage lenders you will still close the loan in person, “eClosings” are becoming more common. Once you have reviewed all the necessary documents, the actual closing can take as little as 15 minutes. Although you may be able to have a virtual closing, there are also some logistical concerns to consider as well. For instance: • Although you are able to take a virtual tour of properties, chances are you may want to go and physically see the property • It’s a wise idea to have an inspection to assess the property • Hire movers to move you into the property To make matters even more complex, you will need a notary and title office as well and with all that is going on with CoVID-19 these agencies and offices are closed but as stated early, much of this work is completed virtually as well. Also, if you are willing to forego the traditional customs in purchasing property and are able to complete the deal virtually there are some great deals to be had. As technology continues to advance, lenders suspect regulations and individuals will adapt with the thought that eventually every real estate transaction will be handled in the cloud. “I Still Think Buying A Home Is the Best Investment Any Individual Can Make” – John Paulson
Property is POWER | July 2020 5
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6 Property is POWER | July 2020
W
hile real estate agents report that far fewer people than normal have been moving during the COVID-19 pandemic, that may soon change. A recent Harris Poll found that nearly a third of U.S. adults living in urban areas are considering a move to less densely populated cities in the wake of the pandemic. Others may not be fleeing the pandemic but simply want or need to move, either for a job change or other reason. If you find yourself preparing to move during these uncertain times, here are some tips to help it go more smoothly. 1. Make a checklist: Set a timeline for completing such tasks as packing, cleaning and registering the kids for school. Staying ahead of the process can help avoid last-minute headaches and make your to-do list seem more manageable. There are even free apps available to help. 2. Organize and purge: Moving is the perfect opportunity to decide what you really want and need in your new home. To lessen the load on moving day, hold a garage sale – following proper social distancing guidelines – or donate unwanted items to charity. You can make the
unpacking process simpler by arranging similar items together and labeling each box accordingly, such as kitchen utensils with cups or clothing of a particular season. You can even label a box as “open me first” for items you’ll need immediately. 3. Notify those who need to know: Let your insurance agent know that you’re moving as soon as possible to be sure you’re covered. You’ll also want to discuss how your needs will change. For example, if this is your first time buying a house, you’ll need a homeowners policy versus renters insurance. On the other hand, if you’re downsizing from a house to an apartment, you’ll still want to ensure your
Losing your home?
belongings are covered, which you can do with renters insurance. Be sure to also call your utility providers to cancel or transfer service and fill out a change of address form with the United States Post Office. You’ll also want to update your address with your bank and credit card companies. 4. Consider what’s covered: You may want to consider moving insurance. Some companies, like Erie Insurance, will cover you during the move and say it’s usually not necessary to purchase an additional policy. Keep in mind there are limits for certain kinds of misplaced, lost or stolen personal property. Your insurance agent can walk through that with you. 5. DIY or hire a pro. While during “normal” times you might recruit family and friends to help you with the move, given ongoing social distancing guidelines, now may not be the right time to ask. If it’s a small move, you may be able to handle it on your own or with the help of just a few immediate family members. Otherwise, consider hiring moving professionals who know the proper safety protocols and will be better equipped to protect your possessions and make sure they’re transported safely. While moving can seem overwhelming, a bit of prep and planning go a long way. By mastering your move, you’ll be sitting down and relaxing in your new home in no time. – (StatePoint)
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Property is POWER | July 2020 7
monthly payments. According to Amplify Credit Union, selling your home can help to reduce or even eliminate your loan. Following a sale, some homeowners receive a payout from their previous home based on the portion that they own. This is determined by the amount of payments that have already been made towards the loan. This portion is referred to as a home’s equity. Using the equity from your old home and putting it towards your new mortgage assists in paying off the loan and reduces debt in the long run. What and when you plan to do in the next three to five years is critical to making the right decision. In fact, time is one of the most important factors. If you plan to sell in the next three to five years, it might not make financial sense, depending on how much equity you currently have in your home, to refinance. Here are some more factors to take into account: 1. Your cash and equity positions. You probably know if you have little equity, or, less than 20 percent, you won’t be able to avoid paying private mortgage insurance. It’s important to note that refinancing is the same as getting a new mortgage. You have to qualify for a new loan and even if your FICO score is good your debt to income ratio might be too high 2. Your current neighborhood. The neighborhood in which your home is located will have an enormous impact on your decision.
Should You
Refinance or Sell? The ongoing question…Should I refinance or sell? Everywhere you look you see, advertisements suggesting: “Lock in the rate!” “Refinance now and save!” Before you know it, you are asking yourself “Should I refinance?” That is a great question and we will explore what the hype is all about as it relates to refinancing. The answer usually comes down to two basic facts. Budget: Avoid accumulating debt as a result of a loan Lifestyle: Downsize living space or access your home equity Whether you ought to refinance or sell comes down to answering a few questions and being honest about your future plans. But before we go any further, let’s explore what the term refinancing actually means. According to Investopedia.com Refinancing is the process of paying off an existing loan and replacing it with a new loan that includes the debt of the old one. Many 8 Property is POWER | July 2020
people refinance by finding a new lender with better terms or interest rates. Lenders may also offer homeowners the option to change their loan type from variable- rate (interest rate may go up or down) to fixed rate (interest rate does not change over the life of your loan), establishing a constant interest rate each year. The question becomes, why are so many people considering refinancing? As of late, in the beginning of March 2020 the Federal Reserve dropped interest rates by half of a percentage point and then dropped it again mid-month to between 0-0.25%. Zero percent is very intriguing, but keep in mind that doesn’t mean you can get a mortgage with 0% interest ~ although that would be AWESOME! The shifts in interest rate is an effort to stimulate the flailing economy in the middle of the COVID-19 Pandemic. What you should know before you go searching to refinane:
Know your credit score: Review your credit report and unfortunately nearly 1-in four credit reports contain errors of some kind. Have you mortgage paperwork handy: Although every mortgage application is unique, there are some common required forms, gather the necessary paperwork in advance. Know if you want to pay closing costs: You can save time on your mortgage approval if you know how you want to have your closing costs paid ~ when refinancing your closing costs can be added to your loan balance ~ also known as “rolling your costs” into your loan. Shop multiple lenders: Mortgage rates are different with every bank and the lender with the lowest rates today may not be the lender with the lowest rates tomorrow. Should you sell your home and move into a new property offers you the opportunity to pay lower interest rates and cheaper
3. Being able to recoup costs. While remodeling certainly increases the value of a home, it doesn’t mean you’ll get back everything you put into it. 4. Your lifestyle changes. Should you be in a position where you just need more space, it probably will be a better idea to sell and buy. While it may seem ideal to sell your home and accept a mortgage with lower monthly payments, there is often increased competition for less expensive homes according to the mortgage consultants at go amplify. com. Also, not all prospective buyers qualify for lower interest rates when looking for new homes. According to homelight.com, lenders typically review the financial history of applicants including credit history, current wages, and the amount of debt owed. Before deciding to sell or refinance, do your research to determine what is best for you and your family and also the options available to you regarding your home. “I will forever believe that buying a home is a great investment. Why? Because you can’t live in a stock certificate. You can’t live in a mutual fund.” – Oprah Winfrey
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www.Kellumortgage.com Property is POWER | July 2020 9
3 Home Exterior Projects That Combine Beauty and Performance Will you be completing outdoor home renovation projects this season? To maximize your investment, consider these project ideas, which combine beauty and long-lasting performance: Smart Landscaping Landscaping is a fundamental aspect of curb appeal. A beautiful design has the power to boost your home’s resale value. What’s more, certain landscape choices may last longer and can even potentially protect the structure of your home. Make the smart and environmentally-conscious choice of sticking with native species, which are more likely to thrive and grow a strong root foundation, helping protect your property in the event of flooding. Select fire-resistant plants that can also act as buffers during high winds. A Complete Roofing System You don’t have to wait for leaks to appear before you consider a new roof. Missing, damaged or
curling shingles are not only an eyesore, they can also be signs of leaks to come. The age of your roof itself can be a guide as to when it’s time to consider an upgrade -- homeowner’s insurance companies generally assume an asphalt shingle roof will last about 20 years.
available GAF WindProven limited wind warranty, the first wind warranty for roofing shingles with no maximum wind speed limit. The brand’s shingles that feature LayerLock technology, such as HDZ, qualify for this warranty when installed with four qualifying GAF accessories.
When it comes to beauty and performance, a new roof can be one of the best investments you make for your home, that is if you select durable products that will protect your family for years to come. Homeowners should know that they don’t have to sacrifice style for strength and durability. For example, new Timberline HDZ shingles from GAF, North America’s largest roofing and waterproofing manufacturer, combine the style, class and design of America’s best-selling shingles (Timberline HD with even better protection thanks to a new innovation called LayerLock technology. The technology offers contractors a faster, more precise installation
Durable Windows
and ultimately, better strength and performance of the roofing shingles. For greater peace of mind, homeowners should also consider complete roofing systems (shingles and accessories) with a
strong warranty. Just be sure to check the fine print, especially if you live in an area with high winds. While many roofing products do come with wind warranties, there are often caveats with regard to wind speed limitations. Timberline HDZ shingles come with an
Today’s high-performance window options can dramatically improve your home’s energy efficiency, provide better sound-proofing and weather resistance, and offer tilt-in capabilities for easier cleaning and maintenance. Some manufacturers offer customization options with regards to grille patterns, window shape, interior and exterior frame colors and glass types, making it easy to find options that complement your home’s style while providing performance features you value. This season, make smart home upgrades that offer you both greater curb appeal and greater peace of mind. – (StatePoint)
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10 Property is POWER | July 2020
4
7 Steps to Preparefor a
Home Remodel
Whether building a home from scratch, doing a complete renovation or simply refreshing a room or two, you can take your project to the next level with some design inspiration. As one half of HGTV’s “The Cousins” and the founder of Lilyshea Development LLC, John Colaneri is well-versed in top design trends. Having recently purchased a 1960s-era rambler with the goal of taking it down to the studs and remaking it, Colaneri is sharing insights and ideas to help you create a unique space in your own home where all the elements blend together:
(Family Features) A homeowner’s motivation for taking on a remodeling project can vary greatly, but there’s one universal rule of thumb: home upgrades should add value, function or both. This step-bystep guide can help ensure you get the maximum return on your investment and make the most of your remodel.
• Color pop. Find a color to carry throughout the entire home. While many people typically look to paint doors and trim white, consider being creative here.
Step 1: Identify Reasons for Remodeling Deciding whether to undertake simple aesthetic changes or a full remodel can be difficult. One of the best ways to decide is to figure out why you are remodeling in the first place, whether it’s to make your new house feel more like home or to update an outdated kitchen. Step 2: Consider Timing Many variables can impact the timing of your project, including the climate and exact nature of the job. For example, foundation work is easier when the ground is cold during winter. Spring tends to be busy for the construction industry, so you might pay premium rates for labor and materials, but it’s also the perfect time to get a project done that you can enjoy throughout the summer. Summer months are ideal for indoor projects out of the heat. Also consider factors such as personal or professional obligations, or even an event for which you need the project completed. Step 3: Set Your Budget Every home is unique in structure, age, quality and craftsmanship, which all impact the price of a remodel. Since no one can see through walls before demolition, the quote you receive may not be 100% accurate. However, a qualified remodeling company will be forthcoming about potential challenges. Account for these adjustments by planning for a 10% cushion, just in case. Step 4: Hire the Right Team To help ensure you find the right company for the job, do your research. Referrals from friends and family are one way to find a remodeler. Resources like the National Association of the Remodeling Industry provide unbiased information that can help you find qualified, certified remodelers in your area. With more than 5,000 member companies, the organization represents professional remodelers who adhere to a strict code of ethics. Many hold certifications in remodeling, kitchen and bath design and lead carpentry. Step 5: Establish a Written Agreement Most companies insist on a contract to protect their own interests, but if they don’t, you should. In addition to defining the scope of work and budget, a contract ensures all parties are on the same page with expectations about factors like timing, liability in the event of an accident and other practical matters. Contractors also often provide guarantees of workmanship, so find out what they cover for how long and include this information in your work agreement. Step 6: Understand the Plan Keep the lines of communication open between you, the remodeling contractor and the work crew. Don’t be afraid to ask questions. Let them know your family’s schedule and circumstances that may affect their work, such as pets. Make sure to specify the best way to reach you and how often you wish to communicate about your project. Step 7: Complete the Project When the remodel is almost finished, walk through the area and note any adjustments that need made while the contractor is still on site. You should also take another look at the contract and confirm you have signed permits, receipts, change orders, lien waivers, warranties and manufacturers’ guides at your disposal.
Find more remodeling advice and contractors in your area at remodelingdoneright.com.
Hot Home Renovation Trends This Summer
“For my home, which has an open concept floor plan, I knew that I wanted to use a dark color for trim and doors in order to enhance other design elements, such as my kitchen island and hood,” says Colaneri. • Something old, something new. Achieving a blend of old and new can bring warmth and texture to otherwise ascetic spaces and design elements. “I love contemporary design, but my true passion is blending old and new together. For the main entry and hallway, I installed reclaimed natural wood to add warmth and character to the space,” says Colaneri. “Likewise, I selected industrial-style light fixtures that boast traditional touches.”
• Let it shine. Blurring that line between the indoors and outside can make a space feel larger and more inviting. To do this, Colaneri suggests replacing old windows with those that bring in more natural light. “I chose black trim to give my windows a contemporary look and allow them to be a focal point, but I went with a farmhouse-style grille for a traditional feel,” he says. “I also changed the rear windows into sliding doors, which made a huge difference by offering more outdoor access and light.”
Colaneri chose to work with Renewal by Andersen because of the quality of the products and the fact that it’s a one-stop shop, which can simplify a home renovation during these uncertain times. “This is the first time I had one company handle so many aspects of my project,” he says. “You need to have a professional team that thinks of all the small things that can go wrong and reacts before they happen.”
• Customized Tiling. Tiles are a great way to customize a space so that it’s truly yours.
“Since I have three different design styles pervasive in my home -- contemporary, rustic and industrial, I wanted the tiles to reflect this,” says Colaneri, who chose different effects for his daughter’s bathroom, the master bathroom and his home’s entryway, where he used a hexagon marble tile that blends into the wood floor. To learn more about Colaneri’s project and read about more ways to freshen up your space, visit getinspiredwithjohn.com. When it comes to a renovation, it’s all about potential. With a little vision, you can transform your home into something that you never thought possible. – (StatePoint)
Source: National Association of the Remodeling Industry Property is POWER | July 2020 11
If a housing provider imposes strict occupancy limit of two “heartbeats” per bedroom without considering factors such as the age of the children or the size of the bedroom… that could be discrimination-and housing discrimination because of familial status is against the law. Contact the Fair Housing Center of Metropolitan Detroit if you’ve been a victim of housing discrimination or to find out more information.
fairhousingdetroit.org • 313-963-4817
12 Property is POWER | July 2020