Thursday, May 28, 2015

Replacing Rain Gutters and Downspouts

Replace missing gutters and downspouts to prevent serious siding and foundation damage that may cost you $10,000 or more to repair.

Your home may be your castle, but if you’re missing downspouts and sections of gutter, you’ll certainly have a moat where daisies once flourished. Excess water near your foundation risks thousands of dollars in foundation repairs. The good news is that gutter or downspout replacement only requires about $15 worth of materials and three to four hours of your time.

Cost of Replacement Gutters and DownspoutsYou’ll find aluminum and vinyl gutter components surprisingly affordable. Here’s what to look for: 
  • Home centers sell 10-foot sections of gutter for less than $8.
  • A 10-foot downspout costs you less than $13.
  • Clip-up downspout extenders that snap out of the way when mowing cost about $8.
  • Gutter sealant runs about $7 for a 10-ounce tube.
  • Buy additional hangers and clips ($2) — the damage may have occurred because there weren’t enough of them in the first place.
  • In some cases, you’ll also need some end caps ($7 per set), joint connectors ($6), and a box of self-tapping screws ($6).

How to Replace Missing GuttersMore often than not, an entire 10-foot section of gutter will be damaged or missing. Use a hacksaw and tin snips to cut shorter lengths of replacement gutter. 
  • Grab two ladders and enlist a helper.
  • Remove any old joint connectors and scrape any sealant or gunk off the existing gutter.
  • Do a test fit with new joint connectors.
  • Fill the ends of the new joint connectors with sealant before installing the gutter.
  • Loosen adjacent hangers if needed to add the replacement section.
  • Add hangers every 3 feet. Confirm that the gutter is pitched toward the downspout at a slope of 1/4-inch for every 10 feet.

How to Add a Downspout 
  • Fit the new downspout up into the drop outlet (the piece at the end of gutter that feeds into the downspout). Notice that the drop outlet fits inside the downspout section to contain the flow and keep the jointing from leaking.
  • Fasten the joint with two self-tapping gutter screws. Add additional sections as needed.
  • Finish the downspout with an elbow positioned at least 6 inches above grade.
  • Attach the downspout extender (it should extend at least 5 feet into your yard).

 Adding All-New Gutters and DownspoutsIf there are lots of missing or damaged pieces, you may decide it is time for a whole new set of gutters. Most residential gutters are made of lightweight and durable aluminum. Vinyl, galvanized steel, and even copper also are options.

Aluminum gutters can range from about $4.50 to $9.50 per linear foot installed. On a 2,000-square-foot house with about 180 linear feet of gutters, that’s roughly $800 to $1,700.

Pat Curry wrote this article appeared on National Association of Realtors® web site and is used with permission. Serial remodeler Pat Curry is a former senior editor at Builder, the official magazine of the National Association of Home Builders, and a frequent contributor to real estate and home-building publications.

Visit for more articles like this. Reprinted from with permission of the NATIONAL ASSOCIATION OF REALTORS®.

Andy Kalinowski is a REALTOR®, an Accredited Buyer’s Representative®, a Short Sales and Foreclosure Resource® and a Military Relocation Professional with CENTURY 21 Doris Hardy and Associates, LLC in Columbus, Mississippi. He has a Mississippi Real Estate license. Andy is also a member of the National Association of Realtors®. Contact him by cell (or text) phone – 662.549.3421 or by e-mail –  He is also available for web video chat.

Wednesday, May 27, 2015

Home Selling Projects

When it comes time for a property owner to sell his home, putting a sign up in the front yard seems too simple. There are many things to do before putting up the sign. Let’s discuss a few of them.

Emotional Project – The longer a person lives in a house, the harder it is emotionally to sell it. There are so many memories there – both good memories of cherished happy times and also sad memories as well. The main objective for a property owner to do is realize two facts when selling a house.

First they are not selling their home. They are selling their house. They will pack up their home, which includes all the furniture, pictures, and trinkets that make it a home and unpack it in another house. They will move all the people and pets as well. The seller needs to realize they are only selling four walls and a roof.

The second fact to realize is that everyone that considers purchasing that house places the same sentimental value on it – ZERO.  Happy and sad events never happened to the buyer inside that house. They happened elsewhere.

Once the current owner comes to accept those two realities, the rest of the selling project is downhill.

Staging Project – The previous step considered the emotional aspect for selling a house. The staging project changes the emotional step into a physical step. This is where the owner begins to strip away the things that make the structure a home and return it to a house. This step happens both outside and especially inside.

What is it that a potential buyer needs to see? It’s the house. Trim shrubby which hides the house. Make the outward appearance of the house as appealing as possible. This is curb appeal. If there is good curb appeal, the odds increase that the potential buyer wants to preview the inside.

Once inside, make the house appear as large as possible. Remove excess furniture. Have only one of two pictures on the walls, especially if those are neutral pictures. Try to establish a focal point in every room to highlight the one thing the buyer must see. Bright rooms sell houses. Dark and dreary rooms make the job more challenging.

Remember this one simple rule. Every seller wants top dollar for their house. So make it appear to the buyer that the house is worth every penny of the asking price.

Financial Project – Before putting a house on the market, it is a good idea to be sure it makes financial sense to do so. Don’t shortchange the process by considering only one or two items.

Know the exact amount of the unpaid mortgage, second mortgage and any mortgage pre-payment penalties. Get a good understanding of the amount of mortgage reduction each month until the house sells. A mortgage amortization schedule details this. Ask the lender for one, if necessary.

Estimate other expenses involved with selling the house. This includes any updating, modernization, staging or temporary storage expenses. Establish a budget for advertising or marketing expenses. There is another expense smart sellers have.

REALTOR® Project – In all real estate transactions there are always two people involved – a buyer and a seller. As the seller, it makes sense to hire a REALTOR® to market the property that creates buyer interest. The REALTOR® also has plenty of information on correct pricing. Find an agent who has experience representing the seller. This becomes especially important when negotiating with a buyer or a buyer’s real estate agent.

That is because the REALTOR® tends to treat the transaction as just that – a transaction and without emotional involvement. That goes back to the original point of keeping emotions out.

Emotions sometimes cloud the decision-making process. Emotions sometimes cloud all the facts. Emotions sometimes cloud all possible alternatives. This is especially true if the seller has an initial reaction of “insulting” to a written purchase offer.

The second largest expense in a real estate transaction is normally the REALTOR® fee. The agent earns this fee by suggesting several possible counter alternatives to a written purchase offer that achieve the overall objective of selling the house. Sometimes facts change. The listing agent reminds the seller of all the facts before the seller makes any decision.

The listing agent reminds the seller of all current conditions Many times those trends change from when the seller first placed the house on the market. There could be other conditions that now have an equal or greater value than the transaction bottom line.

The listing agent helps the seller reach the closing table and still be able to maximize the net proceeds, which is the overall objective.

Andy Kalinowski is a REALTOR®, an Accredited Buyer’s Representative®, a Short Sales and Foreclosure Resource® and a Military Relocation Professional with CENTURY 21 Doris Hardy and Associates, LLC in Columbus, Mississippi. He has a Mississippi Real Estate license. Andy is also a member of the National Association of Realtors®. Contact him by cell (or text) phone – 662.549.3421 or by e-mail –  He is also available for web video chat.

Tuesday, May 26, 2015

Preparing A House For Listing

There is a wise strategy in the home purchase process. It is when a buyer hires a licensed home inspector to provide a full report about the house. This report is really a two-edged sword. It provides the buyer with a thorough examination of the house by a qualified expert. It also gives both parties the ability to back out of the transaction. Let’s see how a seller can best avoid some home inspection problems.

Purpose Of The Inspection – The home inspection has two basic purposes. One is to identify major but correctable defects with the property. Some of these could include insufficient attic insulation, leaks in the roof, heating or air conditioning problems, plumbing issues, electrical problems and so forth. In many cases, the inspector’s findings come as news to the seller. Most sellers are willing to repair major problems. The inspector may identify cosmetic issues such as small blemishes in the screens or an interior door that will not latch.

Many of the identified defects are the result of recent changes in building and safety codes. As an example, 25-30 years ago a builder terminated unused wires with a wire nut. Now those same wires must be further terminated in a junction box. This helps reduce the risk of an electrical short and possible fire.

Advantage To Pre-Listing Inspection – A seller might opt to hire a home inspector to identify potential problems later. This is especially true if the seller lived in the house ten or more years. Then repair those items. This type of strategy gives the listing agent the opportunity to market the house as free of major repair issues, as evidenced by the pre-listing home inspection. Documenting the initial problem and the contractors invoice for repairs is an effective way to differentiate this property from the competition. It shows the seller is very serious about repairs and took proactive steps.

In addition to a home inspection, a very pro-active seller might hire a professional roofing inspector, professional heating and air conditioning inspection as well.  Getting the septic tank pumped and a having a termite inspection could further persuade a buyer that this is a structurally sound house. Marketing the house with these recent repairs helps to differentiate it from the competition. Most sellers wait on the buyer’s inspection.

The pre-listing home inspection also gives the seller a chance to repair even the cosmetic issues, like screens or door knobs. Once again, this helps to persuade a buyer to sign a piece of paper.

Home Warranty – Another popular strategy for a seller to differentiate the property is offering a home warranty. Ask a home warranty sales representative about options such as making a claim against the policy prior to the closing. It is a way to reduce the number of deficiencies while also doing it in a very cost effective manner.  Home warranties differ from company to company. Your REALTOR® has a list of several companies for consideration.

List Price – When putting a house on the market, your REALTOR® has the ability to provide a likely price-range window to the seller based on a house in low, average or excellent condition. This is the type of information a seller needs to know.  Every house has a fair market value based on property condition. A freshly painted house and one free of any defects has a much higher market value than one needing some minor repairs.

If a seller spends $2,500 for inspections and repairs, but now has a house with an additional $5,000 value, which is a great return on investment. Conversely, if same inspections and repairs yield only a $1,000 increase in value, the seller might need to think twice on the front end. That’s because of a negative return on investment. Yet if those repairs help the house sell quicker, only a seller can make that call.

Buyer’s Inspection – Just because a seller has a home inspection does not mean the buyer cannot have one as well. The buyer should hire his own inspector. But here is something for a buyer to consider. If a buyer sees the seller’s home inspection report, and sees it almost exactly matches what the buyer sees during a person visit, a buyer could opt to eliminate that expense from the transaction. That is a major the decision for the buyer. The buyer’s agent can explain the risks involved of not getting an independent evaluation and opinion.

Andy Kalinowski is a REALTOR®, an Accredited Buyer’s Representative®, a Short Sales and Foreclosure Resource® and a Military Relocation Professional with CENTURY 21 Doris Hardy and Associates, LLC in Columbus, Mississippi. He is a Mississippi Real Estate license. Andy is also a member of the National Association of REALTORS®. Contact him by cell (or text) phone – 662.549.3421 or by e-mail –  He is also available for web video chat.

Friday, May 15, 2015

Mid May Comes To Columbus, Mississippi

There is always something going on in Columbus, Mississippi. This week is no exception. Let’s see what is happening in and around Columbus on a weekend in the middle of May.

There are more than a few visitors staying overnight in Columbus this weekend. Actually they are not visiting Columbus but nearby Starkville. Mississippi State University is hosting the annual Southeastern Conference Track and Field Meet. The athletic reputation of SEC football is well-known. Yet the caliber of SEC Track and Field actually surpasses SEC football. These are world class athletes. To win this meet, a team is a contender for the NCAA National Championship. For those looking a unique but quality activity, take the half-hour ride over to Starkville. The track is just north of the baseball field.

There seems to be a nationwide war on police. Communities like a St. Louis suburb or a city as nearby as Hattiesburg have been on the front line. That concerns law abiding citizens everywhere. There is a Peace Officer monument honoring both the Columbus Police Department and Lowndes County Sheriff’s Department officers in front of the Columbus Municipal Complex on Main and 14th Street. Honor the law enforcement shield on Friday at 11:00 a.m. for a wreath laying ceremony.

Break out the fishing poles on Saturday. It’s the third annual bass tournament to benefit Palmer Home for Children. Go to the Tenn-Tom boat ramp on Wilkens-Wise Road any time after day break. Want to compete for the more than $5,000 in prize money? Then attend the rules meeting on Friday at 6:00 p.m. at K&S Outdoors on Highway 45 North.

The Hitching Lot Farmers Market is open every Saturday now starting at 7:00 a.m. Come to the corner of Second Street North and Second Avenue (just west of the Lowndes County Courthouse) for the freshest in locally grown produce and homemade jellies, bread and even lemonade. Shoppers get to enjoy the Southern Gospel music of Melvin Mordecai this week. Bring that special member of the family. The pet parade begins at 9:00 a.m.

As the school year winds down, the Mississippi School for Mathematics and Science has their annual Madrigal Dessert Concert Saturday at 7:00 p.m. with an encore performance on Sunday at 2:00 p.m. The concert is in Shackleford Hall, directly across the street from the Hogarth Student Union on the Mississippi University for Women campus. This promises to be a romp through the Renaissance complete with music, revelry, mayhem and dessert.

It’s the third Saturday of the month. The Echos are performing at the Community Center on Stadium Road in New Hope starting at 7:00 p.m. This is a family-oriented country-western dance jamboree.

The Baddest Bullring In The South is the nickname for the Columbus Speedway located about 2 miles north of US-82 East near the Alabama state line. Be there Saturday for dirt track racing. The Kajun Mini Stocks compete for $1000 to win and $50 to start. There is a 1 lap qualifying, 8 lap heats and 25 lap feature.  The weekly racing series includes limited late model/crate, 602 late models and street stocks. Racing begins at 7:00 p.m.

There is something on Sunday other than attending church. Baptist Memorial Hospital Golden Triangle hosts an all-day patient conference for kidney dialysis patients, kidney transplant patients, as well as kidney patient family members and caregivers. Registration begins at 8:30 a.m. with the first of seven speakers beginning their presentation at 9:00 a.m. Topics include hypertension and diabetes (two leading causes to kidney disease), dialysis, diet and nutrition, transplants, new drugs and attitude. There is a free lunch provided. The conference will be in the Outpatient Pavilion of Baptist Hospital, on Baptist Blvd.

Does anyone have a housing need this weekend? Make a private preview appointment at least 24-hours in advance by contacting your REALTOR®.

Andy Kalinowski is a REALTOR®, an Accredited Buyer’s Representative®, a Sales and Foreclosure Resource® and a Military Relocation Professional with CENTURY 21 Doris Hardy and Associates, LLC in Columbus, Mississippi. He has a Mississippi Real Estate license. Andy is also a member of the National Association of Realtors®. Contact him by cell (or text) phone – 662.549.3421 or by e-mail – He is also available for web video chat.

Thursday, May 14, 2015

7 Landscaping Mistakes That Wreck Curb Appeal

Don’t let badly designed or maintained landscaping wreck your home’s curb appeal. Here are pitfalls to avoid.

Clumsy, neglected, and hodgepodge landscaping not only hurts your home’s curb appeal, it can cut the value of your property and make it harder to sell.

Real estate appraisers say bad landscaping is a buyer turnoff that can increase the number of days a property languishes on the market, which also hurts prices.

“I’ve been with clients who won’t even go into a house because of the bad landscaping outside,” says Mack Strickland, a Chester, Va., REALTOR® and appraiser.

Even more important, bad landscaping is a downer that hurts the way you see and enjoy your home.

Don’t let bad landscaping happen to you.  Here are the seven landscaping mistakes that bust, rather than boost, your home’s curb appeal.

1.  Planting Without a PlanSome landscaping choices, such as a line of begonias, will last a season; others, like trees, can last a lifetime. So, take time to plan and plot a yard that gives you maximum enjoyment and curb appeal.

For the design challenged, landscape architects are worth the investment ($300 to $2,500 depending on yard size). They will render elevations of your future yard, and provide plant lists so you can install landscaping yourself.

2.  Too Much TogethernessYes, planting in clusters looks way better than installing single plants, soldier-like, throughout your yard. But make sure your groups of perennials, shrubs, and trees have plenty of room to spread, or they’ll look choked and overgrown. Also, over-crowded landscaping competes with itself for food and water, putting the clusters at risk, especially during drought.

Google how high and wide the mature plant will be, and then combine that info with the spacing suggestions on planting labels. At first, garden beds of young plants will look too airy and prairie-like. But within three years, your beds will fill in with room to grow.

Remember: First year it sleeps, second it creeps, third it leaps.

3.  Zoning OutDon’t be seduced by catalog plants that look gorgeous on paper but aren’t suited to your hardiness zone. You’ll wind up with plants that die prematurely, or demand winter covers, daily watering, and other intensive efforts to keep them alive and well.

Check plant labels to see which hardiness zones are best for your plants.

4.  More of the SameResist the design temptation to carpet-bomb your yard with your favorite plant or shrub, which will create a boring, monochromatic landscape. Worse, your yard will look great when your fave flowers bloom, then will look drab the rest of the year.

Mix things up and strive for four-season color. For example, combine spring-blooming azaleas with summer-blooming roses and autumn-blazing shrubs — such as burning bushes (Euonymus alatus). For winter color, try the red osier dogwood (Cornus stolonifera), a hardy shrub that sports bright-red branches in winter.


5.  Refusing to Bury Your DeadNothing wrecks curb appeal faster than rows of dead or dying shrubs and perennials. So quickly remove your dearly departed landscaping from your front and side yards.

Spent plants that lived their natural lives are good candidates for a compost pile — if you grind them first, they’ll decompose faster. But if your landscaping succumbed to disease or infestation, it’s best to inter them in black plastic bags, then add to the trash.

6.  Weeds Gone WildWeeds not only wreck the look of your landscaping, they compete with pricey vegetation for water and food. Weeds also can shorten the life of brick, stone, and pavers by growing in mortar cracks.

The best way to stop weeds is to spread a pre-emergent about three weeks before weed seeds typically germinate. If you can’t stop them from growing, at least get rid of weeds before they flower and send a zillion weed seeds throughout your yard.

7.  Contain Those CrittersDeer, rabbits, and other backyard pests think your landscaping is an all-you-can eat buffet, leaving you with denuded branches and topless perennials.

If you’ve got a critter problem:

  • Plant deer- or rabbit-resistant varieties. Your local extension agent can provide a list of green things critters won’t eat in your area. 

Lisa Kaplan Gordon wrote this article appeared on National Association of Realtors® web site and is used with permission. She is an avid gardener, a member of the Fairfax County Master Gardeners Association, and a builder of luxury homes in McLean, Va. She’s been a Homes editor for Gannett News Service and has reviewed home improvement products for AOL. Follow Lisa on Google+.

Visit for more articles like this. Reprinted from with permission of the NATIONAL ASSOCIATION OF REALTORS®.

Andy Kalinowski is a REALTOR®, an Accredited Buyer’s Representative®, a Short Sales and Foreclosure Resource® and a Military Relocation Professional with CENTURY 21 Doris Hardy and Associates, LLC in Columbus, Mississippi. He has a Mississippi Real Estate license. Andy is also a member of the National Association of Realtors®. Contact him by cell (or text) phone – 662.549.3421 or by e-mail –  He is also available for web video chat.

Wednesday, May 13, 2015

Real Estate Sales Figures for Lowndes County Mississippi For April 2015

The first quarter of calendar year 2015 is history. What happened in the real estate market during those first 90 days? Let’s take a look at real estate sales for Lowndes County, Mississippi, which also includes real estate sales inside the city of Columbus.

When considering the below information please remember that the data presented is a representation based in whole or in part on information from the Golden Triangle Association Of REALTORS® or its Multiple Listing Service (MLS) predominantly for the period April 1, 2015 through April 30, 2015 but also for previous months. Neither the Association nor its MLS guarantees or is in any way responsible for its accuracy. Data maintained by the Association or its MLS may not reflect all residential real estate activity in the market. Several properties close each month without any involvement with a REALTOR®. These properties include but are not limited to private sales like a For Sale By Owner, builder owned real estate, bank-owned real estate or auctions. Those non-MLS transactions are not included in this summary. Additionally, non-residential sales including vacant land, multiple unit properties, or commercial real estate are not included in this summary.

Recap – Local REALTORS® assisted in closing 30 transactions in March. This marked the 15th month in the last 17 months to have a minimum of 30 transactions close in a calendar month. The only months to not have 30 closed transactions were January 2014 and January 2015. Traditionally January is a slow month for real estate because of the Christmas season. It takes about 45-60 days to close a real estate transaction. The 30 April closings are below both the March 2015 activity and well below the April 2014 sales.

The median April transaction closed for $116,900 or about $100 a square foot. The median sale represents an actual transaction that is halfway between the house that sold for the most and the one that sold for the least. The average house sold for about $142,000 or about $74 a square foot. The average transaction is a mathematical computation that may or may not represent an actual sale. The average house sold for 96 percent of the list price and spent over five months on the market.

Do houses at the extreme top of the market or the extreme bottom of the market significantly alter those numbers? Let’s remove any listing that sold for more than $300,000 or less than $50,000. That leaves a $250,000 range where most sales take place.

Eliminating the listings at both the high end and low end left 25 listings. Of those 25 listings the median house sold for $121,000 or $72 a square foot. The average house sold for $135,000 or about $75 a square foot, which is about 97 percent of the list price.

In addition to the 30 closed transactions, 38 buyers wrote or negotiated an acceptable purchase offer in April. Expect closings in May and June to have very healthy numbers as these 38 move toward the closing table, along with transactions that pended in previous months.

There are plenty of sellers. More than 50 Lowndes County homeowners decided to list their home with an agent during April. There are over 350 houses on the market in Columbus and Lowndes County. Only 20 houses left the market in April due to an expired listing contract without receiving an acceptable offer.

What To Know – The housing market appears to be recovering from the lean years of 2009-2012. There is still an abundance of listings. Buyers have a 9-month inventory of houses available. In a true “sellers-market” there is less than a six month supply in the inventory. The law of supply and demand applies in real estate, as it does in any market. When there is a large supply, sellers must adjust their price to attract buyers.

That means when a sellers receives a written offer, it is very valuable no matter the price and terms in that offer. Someone honored the seller by putting their opinion on a piece of paper. Every buyer wants a deal. Every seller wants top dollar. Find common ground and a way to bridge the differences. A seller failing to find that common ground might have to wait a while before another buyer writes an offer.

That said, buyers writing a purchase offer thinking the seller is giving away his house at bargain basement prices is in for a disappointment. Treat the house for exactly what it is and will become. It is a valuable asset belonging to the seller. It will eventually become a very valuable asset to the buyer. Therefore offer a fair price based on a professionally prepared market analysis.

Buyer need to remember that market conditions may have changed since the seller put the house on the market. Summarize the rationale for the pricing and terms. Attach the pre-approval letter from the mortgage lender. Ask for common concessions. Those strategies seem to impress sellers. It makes it easier to resolve differences when considering rational data versus getting into ego or personality issues.

One final thought – The data presented above is a general snapshot of overall market conditions for Lowndes County, Mississippi as a whole. It does not represent the actual fair market value for any specific piece of real estate. Factors such as location, property maintenance and motivation affect pricing. Ask a local real estate agent with access to the Multiple Listing Service to prepare a standard client document – a comparative market analysis.

Andy Kalinowski is a REALTOR®, an Accredited Buyer’s Representative®, a Short Sales and Foreclosure Resource® and a Military Relocation Professional with CENTURY 21 Doris Hardy and Associates, LLC in Columbus, Mississippi. He has a Mississippi Real Estate license. Andy is also a member of the National Association of Realtors®. Contact him by cell (or text) phone – 662.549.3421 or by e-mail –  He is also available for web video chat.

Tuesday, May 12, 2015

Which Is Better – Pre-Qualification or Pre-Approval

There are two words that seem very much alike but in reality are very different. Both concern the ability to get a mortgage. Yet the difference between them is like daylight and dark. Let’s fully explain why receiving a mortgage pre-approval letter is a significant milestone in the home purchase process, and why a mortgage pre-qualification has little real value.

Pre-Qualification – Some homebuyers want a very rough idea on how much house they can afford without disclosing sensitive financial information. That is the ideal situation for a pre-qualification letter. The potential borrower receives some preliminary information about the mortgage process, which respect to loan rules and limitations. Most potential borrowers learn about the debt to income ratio, and how a credit score impacts the process.

Because the potential borrower does not give the lender access to financial information, the pre-qualification process does not review credit scores. Rather the lender provides instructions on how to obtain a credit report from each agency and what to look for on the printed report.

Most importantly, a pre-qualification letter does not legally bind either side to accept or approve a mortgage. That is because the lender did not have the authority to validate the credit scores, verify income, debt, savings or employment. The potential borrower has the option to use another financial institution for the actual mortgage.

Seldom does a REALTOR® attach a pre-qualification letter as proof of financial capability when writing a purchase offer.

Pre-Approval – Serious homebuyers realize that to purchase a home, they need the financial backing of a reputable lender. They realize that a mortgage originator is not snooping into their finances, but rather helping them to achieve a major goal in life. Achieving that goal means a close and thorough examination of their finances. There is a reason.

Suppose the goal is obtaining a $175,000 mortgage. That means the bank expects the borrower to repay more than $300,000 over a 30-year period. That is one reason that mortgage pre-approval is so much more difficult to obtain than a car loan or a student loan. Today’s homebuyer will not pay off the entire mortgage until 2044. It’s hard to comprehend that today. It’s much easier to grasp fully repaying a 6-year car loan by 2020. Even 2029 seems like a distant date for a 15-year mortgage. Does that explain why lenders must take precautions?

Here is one final thought to remember about the pre-approval process. Most people have a goal to buy a home, live in it for a very long time and then sell it for a profit. That is why buyers take the risk of buying home. There is no guarantee of a two or three fold profit if they retain ownership of the house for 20 or 30 years. A bank does the same type of diligence before they take the risk of the money.

Documentation – To get pre-approved a lender needs certain documents. Most require pay stubs covering the last 30 to 60 days of continuous employment. If there is other income, such as investment or retirement accounts or other employment, then provide that as well. The lender needs to know both the amount and the source for all assets. Expect the lender to independently verify the authenticity of the documentation.

There is another source of income a lender verifies. Provide the most recent two years of federal and state income tax returns. Why?

Lenders try to reconstruct household spending patterns. They are not looking to see where the money goes. Rather they are trying to determine if there is any hidden income source that could improve the pre-approval amount.

At the same time, this pattern also helps the potential borrower realize where they spend their money. Sometimes this is a valuable service that helps a borrower get an even firmer grasp on personal spending habits.

Credit Report – All mortgage lenders request a credit report from the major reporting agencies. Think of a credit report in the same light as a child bringing home a report card from school. An academic report card reports on how the student grasped the learning objectives on a subject by subject basis versus a preset acceptable standard. It’s the same with a credit report.

When a credit card company issues a credit card, the implication is for the card holder to repay an acceptable amount in a certain period of time. The credit card company reports that information for inclusion on the credit report. Timely credit card payments provide positive data. Late credit card payments or collection actions provide negative data.

Making A Decision – Mortgage lenders use all financial data to write a pre-approval letter. Receiving a letter is a major milestone because the bank made an agreement with the potential borrower to lend a specific amount of money for a long time. The only missing piece of the puzzle now is for the borrower to provide a property address and purchase price. This is where the real estate agent comes into play and suggests available listings.

Andy Kalinowski is a REALTOR, an Accredited Buyer’s Representative®, a Short Sales and  Foreclosure Resource® and a Military Relocation Professional with CENTURY 21 Doris Hardy and Associates, LLC in Columbus, Mississippi. He has a Mississippi Real Estate license. Andy is also a member of the National Association of Realtors®. Contact him by cell (or text) phone – 662.549.3421 or by e-mail –  He is also available for web video chat.