Do you offer your clients an annual loan review after their mortgages close? Now would be a good time to start. With interest rates forecasted to inch up throughout the year, many clients might benefit from refinancing.

Things Change

Rate changes are just one reason why revisiting mortgage structures may be beneficial for clients (e.g., moving from an adjustable rate to a fixed rate). Home values have also been on the rise in many parts of the country, which could lead some clients to pay mortgage insurance unnecessarily.

Improvements in household finances and credit scores might also enable you to find a more affordable financing structure for a client. This could also lead to a conversation about their ability to trade up if the right home became available.

Updating information about income and family changes can often have an added benefit. It’s a way to keep in touch. It can allow you to find out about an upcoming move or discuss options for financing an addition to the current home. Older clients may be thinking about buying a vacation property or might benefit from learning about reverse mortgage options.

Value for the Client

While staying top of mind and potentially rustling up new business is good for you, the advantages of an annual review for your clients are equally compelling.

Reviews offer the opportunity to:

• Reduce monthly payments by eliminating mortgage insurance.
• Shorten terms to speed up repayment.
• Lower monthly payments with a different term or interest rate.
• Access home equity to realize other financial goals.

Purchasing a fixer-upper can do more than satisfy your housing needs. It offers you an opportunity to restore a whole structure to its full market value and even improve the look of your neighborhood. In the process, it can also boost your own net worth.

Fixer-Upper vs. Reconstruction  

Often, fixer-uppers are well-constructed homes that have been neglected or experienced unfortunate updates. These homes typically need cosmetic changes that can range from repainting and landscaping to kitchen and bath updates.

In other cases, homes that have structural issues in need of attention generally require a more substantial investment. Repairing a foundation, mold remediation, water damage, new plumbing and electrical, and replacing a furnace or adding air conditioning are higher cost fixes. However, this is also your chance to make sure the job is done right.

Either way, if you’ve found a home in a location you like and that you connect with, it helps to refocus on the investment that will be needed to address any necessary changes. Then, you can make an offer and come up with a plan for how you will finance the fixes.

Look Before You Leap

With a fixer-upper, you’ll want to hire a well-regarded inspector to walk through the home and determine what will need addressing before you make an offer. For instance, this person can tell you if the water stain on the wall is from a loose gutter or if the roof needs to be replaced, which are repairs that reside in two very different price brackets.

Having an inspection report and estimates for the work you expect to have done can also help when you start negotiating with the current owner. It can both substantiate your offer and potentially alert the owner to issues they may not have been aware of.

Financing Options for a Fixer Upper

Unless you are buying a property for cash or can pay for your planned renovation out of pocket, you will want to choose a Loan Officer who can provide you with options that accommodate both the purchase and the improvements.

Some lenders are able to offer a Federal Housing Administration loan, the FHA 203k Home Improvement Loan, which enables you to receive a mortgage for more than the market value of the home you are purchasing (up to $35,000). By combining the amount of your expected costs with your purchase, the FHA 203K also enables you to limit your closing costs and to start working on the home immediately after closing.

Conventional mortgages are also an option. Often, borrowers will use savings or take out a personal loan to cover their renovation expenses and then refinance (with a cashout) once the renovation is complete and the home appraises at a higher value.

So, What Type Are You?

Restoring a home requires either the willingness to hire and manage contractors or the time and skills necessary to do the work yourself. It also requires the ability to see beyond what a structure looks like today to how it will look after you transform it into your dream home.

Being a Real Estate Agent isn’t just an occupation—it means you are in business for yourself. That’s both freeing and a responsibility.

It also means you need to be as focused on the bottom line as you are on your top-line sales, and that success takes more than prospecting for new leads. You also have to manage your cost of doing business. Here are some suggestions for exerting more control over your business expenses.

Watch the Nickels and Dimes

The key is not to spend more than you have to. That means monitoring your expense accounts and bill payment dates to make sure everything gets paid on time. Also, shop around for low-fee business credit cards and bank accounts.

Using discounts and coupons furthers the cause along with signing up for rewards and loyalty programs at the restaurants, gas stations, and office supply stores you frequent for business purposes. The money you get back, especially when it comes in the form of gift cards, can be useful in offsetting house-warming gifts and other business-related purchases.

Use Technology

Time is money, and when it comes to your time, load up on tools that will help you make the most of yours. Scheduling assistants and neighborhood apps that make you an expert in the areas you are showing can be invaluable. There are also many apps that will automatically track the amount you drive for business and enable you to keep a log so that you can take the mileage deduction at tax time. This could potentially add up to thousands of dollars.

Hold Your Marketing Expenses Accountable

Be sure to measure the effectiveness of your expenses. They should lead to a return. For instance, monitor your lead generation system to ensure it is paying for itself. From low-tech signs to direct mail, make sure the techniques you use offer you a return on investment before reinvesting in that approach.

Be a Better Driver

Being a Real Estate Agent is a car-based business. While it helps to drive a fuel-efficient car, there are many other factors you will want to consider to improve that efficiency and reduce your trips to the gas station.

• Check your tires at least monthly. Maintaining them at the optimal PSI rating suggested by your manufacturer directly impacts your mileage.
• Avoid quick accelerations, speeding, and sudden stops. Gradual braking and a steady speed use substantially less gas.
• Turn off the engine. An idling engine is one that is consuming gas—and your money—for no reason.
• Refrain from using your trunk as an office supply closet. The lighter the load, the less gas you consume, so you may want to remove the “open house” signs after each use.
• Use mapping tools with the same vigor that car services do. Companies like Uber provide their drivers with routing information that helps them avoid traffic jams.
• Avoid multiple trips to outlying areas. Some Real Estate Agents to encourage clients to take virtual tours to limit showings to just those with the highest interest level. Still others require buyers to have a preapproval letter in hand before getting in the car.

Real Success

When you are in business for yourself, every action you take impacts your bottom line. Closing transactions is your ultimate goal, but keeping your eye on how much you spend to close them can improve your ultimate results.