The 10 Financial Products and Services with the Most Consumer Complaints

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Which financial product or service do people complain about the most? Is it credit cards? Auto loans? Mortgages? Student loans? Debt collection? The answer lies with the Consumer Financial Protection Bureau (CFPB).  

Each month, more than 25,000 people contact the CFPB for help regarding financial products or services. Because the CFPB is a federal agency charged with “protecting consumers in the financial marketplace,” it has received over 1,242,800 complaints (as of mid-2017) regarding a variety of financial products and services.

Thanks to the CFPB and its detailed reporting, you can see the 10 financial products and services that frustrate everyday consumers the most.

#1 Financial product or service with the most complaints: debt collection

Total complaints for debt collection

  • 2016: 87,927
  • 2015: 85,058
  • 2014: 88,277

#2 Financial product or service with the most complaints: credit reporting

Total complaints for credit reporting

  • 2016: 53,923
  • 2015: 54,918
  • 2014: 44,663

#3 Financial product or service with the most complaints: mortgages

Total complaints for mortgages

  • 2016: 51,132
  • 2015: 50,728
  • 2014: 51,105

#4 Financial product or service with the most complaints: bank accounts or services

Total complaints for bank accounts or services

  • 2016: 28,382
  • 2015: 22,370
  • 2014: 21,226

#5 Financial product or service with the most complaints: credit cards

Total complaints for credit cards

  • 2016: 26,583
  • 2015: 22,176
  • 2014: 18,552

#6 Financial product or service with the most complaints: consumer loans

Total complaints for consumer loans

  • 2016: 16,364
  • 2015: 13,507
  • 2014: 9,570

#7 Financial product or service with the most complaints: student loans

Total complaints for student loans

  • 2016: 12,329
  • 2015: 7,259
  • 2014: 6,781

#8 Financial product or service with the most complaints: payday loans

Total complaints for payday loans

  • 2016: 4,416
  • 2015: 5,510
  • 2014: 5,598

#9 Financial product or service with the most complaints: prepaid cards

Total complaints for prepaid cards

  • 2016: 2,500
  • 2015: 3,031
  • 2014: 823

#10 Financial product or service with the most complaints: money transfers

Total complaints for money transfers

  • 2016: 2,341
  • 2015: 2,351
  • 2014: 1,891

Have a problem with a financial product or service? You can always submit a complaint.

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5 Things Every Service Member Needs to Consider before Buying a House

Active-duty military members are given a number of financial protections, and the major credit reporting agencies just added one more perk to that list.

Buying a house is a serious commitment of not only your time and energy but also your money. For each person considering buying a home, there are different pros and cons. When you’re in the military, there is an extra degree of difficulty: you don’t always have a lot of time to make that choice. Oftentimes, service members decide to buy a house in a rush and forget to consider some important factors that should go into such a large purchase.

Here are five things to think over before you commit to buy a house at your next duty station.

1. Time on Station

Consider how long you could potentially be at your duty station. Is it going to be less than two years? Buying a home is a long-term commitment, and you’ll want to be able to keep the house for at least as long as it will take you to recoup your investment before you try to sell it again. If you know you’ll be at your duty station for only a year, this may not be the time to buy a house unless you know you’ll be back.

2. PCS Orders

It’s probably just a matter of time before you get orders again. Before you buy a home, you should have a plan for what happens to the house when you receive new orders. Will you sell it or rent it out? Know what your goals are for buying and selling the house before you make the commitment to purchase one.

3. Location

Some people like to live close to base so they can go home after physical training or to avoid traffic. Others want to live far away from base to get away from work. Visit the house you’re interested in purchasing when your family and neighbors would be at home and at the times you’ll be commuting to work. During those times, you’ll have a more realistic picture of what day-to-day living will be like if you get the house. Don’t forget your family’s commutes as well. Civilians may not be able to find a job in the local area and therefore may have a long commute, and if there’s not a school in the area nearby, your children’s commute will be affected as well. Choosing a location that works for your whole family is an important part of your home-buying decision.

4. VA Loans

There are two things you’ll want to take into consideration when it comes to your VA loan. First, each time you use your VA home loan benefit, the funding fee goes up. The fee is in place to help compensate taxpayers for the benefit you receive to avoid down payments and mortgage insurance. Many service members and veterans are not aware that the funding fee increases with use and are surprised by higher mortgage payments when they buy again. Second, even if you decide against using your VA loan benefit, remember that most potential buyers in the area will be military affiliated and using a VA loan themselves. Because of that, you’ll want to make sure your house meets the VA’s minimum property requirements. If not, you’ll end up spending more in repairs when it comes time to sell.

5. Deployments

Deployments are a reality of military life. What will you do with your house during deployments? Will your partner move back home for the time? Will roommates be in charge of your house while you’re gone? How long will your deployments be? And most importantly, do you want to be on the hook for a mortgage payment and maintain the home during a deployment? Think about these factors before you buy a house.

Being in the military doesn’t have to mean the end of your home-buying dreams. Visit our Mortgage Learning Center for more information on the ins and outs of purchasing your first home.

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3 Steps to Figure Out How Much Mortgage You Can Afford

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Generally, the amount a lender will allow you to borrow for a mortgage is the amount at which the monthly loan payments (including principal, interest, property taxes, and homeowners insurance) equal no more than 28% of your gross monthly income. If you have excellent credit, some lenders may allow room for leniency. Additionally, your total debt payments (including the mortgage payment and all other debt) typically cannot exceed 36% of your monthly income.

While many borrowers use this as a guideline for the mortgage they can afford, it is really meant to be a lending guideline for how much you can borrow. However, the amount you should borrow is not necessarily the same as the amount you can borrow.

Follow this three-step process to help you determine how much you should spend on a home.

1. Prepare a Budget

In order to determine the mortgage payment you can afford, you need to first prepare a budget. It is critical to include the proper short-term savings and long-term investing in your budget before you establish the amount to allocate toward a mortgage payment. While owning a home can help build your net worth, it is an extremely illiquid asset that is not easily converted to cash. You should make certain that you have enough in short-term savings to pay your mortgage for at least six months in the event of an unforeseen financial setback. Also, make certain not to reduce your long-term savings goals for things such as retirement or your children’s future college education expenses.

2. Account for Increased Expenses

The good news is many of your budgeted items will not change with the purchase of a new home. For example, dining, food, clothing, and travel expenses will likely remain as they were before the move. However, some items like homeowners insurance, lawn care, pool maintenance, HOA dues, and utilities may increase when you purchase a residence. Property taxes will also likely increase, so just plugging in the amount the current owner pays may result in errors. If your purchase price is higher than the value listed on the tax rolls (as is commonly the case), you should recalculate the property tax based on the purchase price you will pay. It may take up to a year for the taxing authority to update the tax rolls, but eventually the purchase price will be used to determine your property tax due.

3. Determine Your Optimal Mortgage Payment

Once you have prepared a new budget, it will become apparent how much of a mortgage payment you can afford. If the amount you can afford is less than the amount you want to borrow, it may be necessary to adjust other budget items. Focus on reducing discretionary (non-essential) expenses. For example, you might consider reducing the amount you spend on vacations, entertainment, dining out, hobbies, and even your monthly television subscription so you can allocate more toward your new home. It is also a good idea to shop around for your auto insurance policy at the same time you are getting new homeowner insurance. Bundling these two policies with the same insurance company can often reduce your monthly premium by as much as 20%. All of these little changes to your budget can add up to a tidy sum that can help you purchase the home of your dreams.

Buying a home is no small feat, and there are many financial ins and outs to navigate as you prepare for this step in your life. As parting tips, don’t forget that you’ll need cash for your down payment (which will also influence the amount of your loan), and it’s helpful for you to check your credit report before speaking to a lender so you understand whether your lender will view you as a high-risk or low-risk borrower. Planning is key, and the more thought and energy you put into the process ahead of time, the more smoothly the home-buying process will go.

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Buying a Home? Ask Your Partner These 4 Questions First

Row of colorful garden homes with two stories and white pillars in suburban neighborhood of Fayetteville, Arkansas

Buying your first home is incredibly exciting, but there’s also more than a little bit of stress that comes with it. A house is a big purchase, and it brings a whole host of new hurdles beyond the initial price tag.

If you’ll be purchasing your first house with your significant other, one way to avoid some of that stress is to have a few important conversations before you even start your house search. Based on my experience buying a house with my husband, these are a few of the questions I’d suggest chatting about before you set out to find your perfect pad.

How Long Do We Plan to Live There?

You don’t have to set an exact time frame on your house purchase, but it’s a good idea to see if you’re both on the same page before you find a place to live. You should try to stay in the home at least until you hit your break-even year to recoup the purchasing costs. And depending on where the house is located, that could be several years down the road.

To determine whether you’ll be able to make that much of a commitment, have a frank conversation with your partner about your plans in the coming years. Do you see yourself building a family in this house? Are you both happy in your current jobs, or do you foresee a job search in the future that could make for a long commute? Life throws curveballs, of course, but talking about these things ahead of time will help you narrow down the type of house you both want based on your future goals.

How Much House Can We Afford?

This is one of the most important questions you should discuss with your significant other before buying a house. It’s not uncommon for people to get approved for mortgages with monthly payments that would, in actuality, be very hard for them to afford. Only you and your partner know how your finances work out on a monthly basis, so sit down and have a solid look at everything to fully understand how much money you can put toward a mortgage each month and still feel comfortable. You may also want to consult with a financial adviser together.

Keep in mind that putting down less than 20% of your overall home cost at closing will likely mean that you’ll have to pay private mortgage insurance (PMI) on top of your monthly mortgage fee. Luckily, there are plenty of resources out there to help you determine an affordable down payment, as well as tools to help you figure out how much house you can afford.

Are We Looking for a Fixer-Upper?

Some people prefer a house they can add their own touches to, while others would rather walk into a house that’s perfect for them without having to change a thing. Talk about this before your house hunt so you’ll know whether or not you’re both willing to put in the effort (and money) for any necessary updates if that’s the route you decide to go.

How Will We Save for Miscellaneous House Expenses?

When you own your own home, there is no end to the list of things you’ll spend money on. From leaks and cracks to peeling paint and clogged gutters, it seems like there’s always something that needs fixing. Of course, some of those things can usually wait, but in order to fix larger issues—especially those that need urgent attention, like plumbing problems—you’ll need an immediate flow of cash. Chat about how you plan to pay for surprises that crop up, and if you don’t already have an emergency savings account, start one today.

After you’ve talked over these four critical questions with your significant other and come to a decision that makes you both happy, it’s time to start looking. And when you’re ready to make an offer, check out our Mortgage Resource Center for more information on how to take that next big step.

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3 Surprising Expenses to Prepare for When You Buy Your First House

Millennials are increasingly becoming homeowners, but in some cities more than others.

When you first buy a house you expect to pay for a lot of things. Increased utility and insurance bills, furniture to fill your rooms, and perhaps even an HOA fee are all par for the course when you buy a home. Take it from me, though: it’s the little purchases that really add up and will take you by surprise.

Learn from my mistakes. Here are three things to watch out for when you buy your first home.

1. Outdoor Accouterments

As a former city apartment dweller, it never occurred to me that it might cost money (and a lot of it, at that) to keep up with the outside of a house. From sprinkler upkeep and landscaping to a lawnmower, patio furniture, and the occasional garden gnome, putting together an al fresco experience that you enjoy can really cost a fortune—and that’s before you get into structural upkeep like painting, roofing repair, and window washing.

If you can stand it, I recommend waiting until the peak outdoor season is over to really cash in on deals for outdoor goodies. Sites like Nextdoor can also put you in touch with people in your own neighborhood who might be selling or giving away exactly what you’re looking for.

2. Incidentals

The occasional paint touch-up here or maintenance need there is pretty common when you buy a new house, but why we needed ours was the big surprise. As it turns out, even though our house was listed as having central air, it did not (a small oversight on everyone’s part when it came to the walkthrough). And once we moved in, we removed two huge bookshelves in the den and discovered that the walls had been freshly painted and the white shag carpet had been replaced with wood flooring—around the bookshelves.

In other words, make sure you go through everything with a fine-tooth comb before signing on the dotted line to minimize the amount you have to spend on things like paint or varnish. In the end, none of these things would have stopped us from buying the house, but we could have asked the previous owners to help cover some of the costs.

3. Tools

My husband and I had always lived in city apartments before moving into our first house, and our hammer and screwdriver were pretty much the extent of our toolbox. As it turns out, home repairs often require more than just those two particular items.

I can’t really estimate how much we’ve spent on additional tools at this point, but taking the time to research the best prices and do some bargain hunting will certainly help you save on these items. I recommend doing the research now, before you desperately need those tools. It’s much easier to find the best deals when you don’t need that item right that very minute.

At the end of the day, it comes down to expecting the unexpected when houses are involved. But hey, that’s what an emergency savings account is for, right? Don’t have one of those yet? Here are three simple steps to starting one.

If you’re still in the market for a new home, check out our Mortgage Learning Center for expert tips and tricks for getting the most out of your mortgage.

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The States Most (and Least) Likely to Have Underwater Properties

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More than 5.4 million homes in the United States are “seriously underwater”—meaning the loan amount is 25 percent higher than the property’s market value. But which state has the most (or fewest) underwater homes? Is it yours?

Using the ATTOM Data Solutions property database, you can see the top 15 states in the US with the highest percentage of seriously underwater homes, as well as the 15 states with the lowest percentage.

See if your state made the top 15 with the most (or fewest) seriously underwater properties.

#15 Most Underwater Properties

Pennsylvania: 10.3% of properties are seriously underwater.

#14 Most Underwater Properties

Georgia: 11.2% of properties are seriously underwater.

#12 (Tie) Most Underwater Properties

Arkansas: 11.4% of properties are seriously underwater.

#12 (Tie) Most Underwater Properties

Connecticut: 11.4% of properties are seriously underwater.

#11 Most Underwater Properties

New Jersey: 12.1% of properties are seriously underwater.

#9 (Tie) Most Underwater Properties

Florida: 13.1% of properties are seriously underwater.

#9 (Tie) Most Underwater Properties

Maryland: 13.1% of properties are seriously underwater.

#8 Most Underwater Properties

Michigan: 13.3% of properties are seriously underwater.

#7 Most Underwater Properties

Delaware: 13.4% of properties are seriously underwater.

#6 Most Underwater Properties

Missouri: 14.2% of properties are seriously underwater.

#5 Most Underwater Properties

Indiana: 16.4% of properties are seriously underwater.

#4 Most Underwater Properties

Ohio: 16.5% of properties are seriously underwater.

#3 Most Underwater Properties

Illinois: 16.8% of properties are seriously underwater.

#2 Most Underwater Properties

Louisiana: 17.1% of properties are seriously underwater.

#1 Most Underwater Properties

Nevada: 17.4% of properties are seriously underwater.

#15 (Tie) Least Underwater Properties

Hawaii: 5.5% of properties are seriously underwater.

#15 (Tie) Least Underwater Properties

Texas: 5.5% of properties are seriously underwater.

#13 Least Underwater Properties

Wyoming: 5.4% of properties are seriously underwater.

#12 Least Underwater Properties

Montana: 5.0% of properties are seriously underwater.

#11 Least Underwater Properties

Colorado: 4.9% of properties are seriously underwater.

#10 Least Underwater Properties

Washington: 4.8% of properties are seriously underwater.

#9 (Tie) Least Underwater Properties

North Dakota: 4.7% of properties are seriously underwater.

#9 (Tie) Least Underwater Properties

Idaho: 4.7% of properties are seriously underwater.

#7 (Tie) Least Underwater Properties

Minnesota: 4.6% of properties are seriously underwater.

#7 (Tie) Least Underwater Properties

Massachusetts: 4.6% of properties are seriously underwater.

#5 Least Underwater Properties

Mississippi: 4.5% of properties are seriously underwater.

#4 Least Underwater Properties

Utah: 4.4% of properties are seriously underwater.

#3 (Tie) Least Underwater Properties

Oregon: 4.3% of properties are seriously underwater.

#3 (Tie) Least Underwater Properties

Vermont: 4.3% of properties are seriously underwater.

#1 Least Underwater Properties

Alaska: 4.0% of properties are seriously underwater.

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42 States with the Highest Home Seller Profits

Home For Sale Real Estate Sign and Beautiful New House.

If you’ve been thinking about selling your home, we’ve got some good news for you. According to RealtyTrac.com, home sellers saw an average price gain of $51,000 in Q2 of 2017. That’s a 26% average return on the previous purchase price. Most homeowners who sold during Q2 this year had owned their home an average of eight years, and while it’s a great time to sell your home right now, that also means homebuyers are looking at steep competition in today’s seller’s market. Find out the average home seller profits for your state in Q2 this year.

1. California, San Jose-Sunnyvale-Santa Clara

Average Price Gain Since Purchase: $410,000

Average Return Since Purchase: 74.5%

2. Hawaii, Urban Honolulu

Average Price Gain Since Purchase: $171,300

Average Return Since Purchase: 48.4%

3. Colorado, Boulder

Average Price Gain Since Purchase: $165,320

Average Return Since Purchase: 49.4%

4. Washington, Seattle-Tacoma-Bellevue

Average Price Gain Since Purchase: $165,000

Average Return Since Purchase: 63.5%

5. Massachusetts, Boston-Cambridge-Newton

Average Price Gain Since Purchase: $150,000

Average Return Since Purchase: 57.3%

6. Oregon, Portland-Vancouver-Hillsboro

Average Price Gain Since Purchase: $129,800

Average Return Since Purchase: 58.7%

7. Nevada, Reno

Average Price Gain Since Purchase: $100,000

Average Return Since Purchase: 46.5%

8. Arizona, Prescott

Average Price Gain Since Purchase: $86,000

Average Return Since Purchase: 46.7%

9. New Jersey, Newark-Jersey City

Average Price Gain Since Purchase: $82,000

Average Return Since Purchase: 29.5%

10. New York, New York City

Average Price Gain Since Purchase: $82,000

Average Return Since Purchase: 29.5%

11. Florida, Miami-Fort Lauderdale-West Palm Beach

Average Price Gain Since Purchase: $77,900

Average Return Since Purchase: 45.3%

12. Utah, Provo-Orem

Average Price Gain Since Purchase: $76,879

Average Return Since Purchase: 44.1%

13. Texas, Dallas-Fort Worth-Arlington

Average Price Gain Since Purchase: $75,511

Average Return Since Purchase: 51.2%

14.Tennessee, Nashville-Davidson-Murfreesboro-Franklin

Average Price Gain Since Purchase: $66,750

Average Return Since Purchase: 43.8%

15. South Carolina, Charleston-North Charleston

Average Price Gain Since Purchase: $58,000

Average Return Since Purchase: 29.4%

16. New Hampshire, Manchester-Nashua

Average Price Gain Since Purchase: $56,000

Average Return Since Purchase: 28.1%

17. North Carolina, Asheville

Average Price Gain Since Purchase: $53,000

Average Return Since Purchase: 28.6%

18. Rhode Island, Providence-Warwick

Average Price Gain Since Purchase: $53,000

Average Return Since Purchase: 26.9%

19. Wisconsin, Madison

Average Price Gain Since Purchase: $50,750

Average Return Since Purchase: 26.0%

20. Idaho, Boise

Average Price Gain Since Purchase: $50,354

Average Return Since Purchase: 31.9%

21. Minnesota, Minneapolis-St. Paul-Bloomington

Average Price Gain Since Purchase: $47,000

Average Return Since Purchase: 24.4%

22. Georgia, Atlanta-Sandy Springs-Roswell

Average Price Gain Since Purchase: $39,100

Average Return Since Purchase: 24.5%

23. Michigan, Detroit-Warren-Dearborn

Average Price Gain Since Purchase: $39,000

Average Return Since Purchase: 37.1%

24. Alaska, Anchorage

Average Price Gain Since Purchase: $36,319

Average Return Since Purchase: 15.4%

25. New Mexico, Albuquerque

Average Price Gain Since Purchase: $34,458

Average Return Since Purchase: 22.9%

26. Virginia, Richmond

Average Price Gain Since Purchase: $34,050

Average Return Since Purchase: 17.5%

27. Connecticut, Bridgeport-Stamford-Norwalk

Average Price Gain Since Purchase: $34,000

Average Return Since Purchase: 9.1%

28. Missouri, St. Louis

Average Price Gain Since Purchase: $33,351

Average Return Since Purchase: 26.3%

29. Ohio, Columbus

Average Price Gain Since Purchase: $32,750

Average Return Since Purchase: 22.6%

30. Pennsylvania, Pittsburgh

Average Price Gain Since Purchase: $32,500

Average Return Since Purchase: 28.3%

31. Nebraska, Lincoln

Average Price Gain Since Purchase: $29,000

Average Return Since Purchase: 22.7%

32. Louisiana, New Orleans-Metairie

Average Price Gain Since Purchase: $27,000

Average Return Since Purchase: 18.2%

33. Indiana, Indianapolis-Carmel-Anderson

Average Price Gain Since Purchase: $26,037

Average Return Since Purchase: 22.0%

34. Maryland, Baltimore-Columbia-Towson

Average Price Gain Since Purchase $25,100

Average Return Since Purchase 12.6%

35. Mississippi, Memphis

Average Price Gain Since Purchase: $20,500

Average Return Since Purchase: 16.1%

36. Arkansas, Fayetteville-Springdale-Rogers

Average Price Gain Since Purchase: $20,240

Average Return Since Purchase: 14.0%

37. Kentucky, Clarksville

Average Price Gain Since Purchase: $20,150

Average Return Since Purchase: 16.9%

38. Alabama, Huntsville

Average Price Gain Since Purchase: $18,140

Average Return Since Purchase: 13.5%

39. Illinois, Chicago-Naperville-Elgin

Average Price Gain Since Purchase: $18,059

Average Return Since Purchase: 8.7%

40. Iowa, Cedar Rapids

Average Price Gain Since Purchase: $17,500

Average Return Since Purchase: 14.3%

41. Oklahoma, Oklahoma City

Average Price Gain Since Purchase: $17,000

Average Return Since Purchase: 13.2%

42. Kansas, Kansas City

Average Price Gain Since Purchase: $10,119

Average Return Since Purchase: 6.4

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How Real Estate Agents Use Your Favorite Restaurants to Sell Homes

If you love to eat, you'll want to check out our top picks for some of the best foods the world has to offer.

That pizza place down the street could make or break your home sale. The best real estate agents know how to use your favorite restaurants as evidence of a great neighborhood when they market your home to buyers—helping you get a faster sale and a better price.

Top real estate agent George Graham stands behind using your favorite haunts to your advantage when selling your home. He told us that “having great food options is definitely a consideration a person makes when buying in an urban location.”

How does your real estate agent use the trendy diner down the street to sell your house? We interviewed three top real estate agents to show you their tricks of the trade.

1. Seller’s Agents Talk Up Restaurants as a Big Part of the Community

Restaurants help create the pulse of a neighborhood. When buyers decide on a location, the neighboring restaurants and shops are an essential component to the life—and the energy—of the area they’re investing in. That’s why real estate agents often use the best restaurants in the area to advertise how great the home is. As Minneapolis real estate agent Alexander Boylan pointed out, agents are “not only selling a house, but they’re also selling a community.”

Boylan went on to say that real estate agents will often “advertise restaurants as a selling point for the home because of the walkability of the neighborhood.”

That isn’t just the case in Boylan’s market. Graham told us that many buyers are concerned with the walkability of a listing. He said that pointing out “the close proximity to great shopping, food, and restaurants is helpful, especially if you are dealing with a downtown location.”

Elizabeth Weintraub, a top-performing seller’s agent in Sacramento, even tried out the top Mexican joint in the neighborhood of her latest listing and wrote about it on her blog.

She writes, “The location is perfect. Imagine living a half block away from William Land Park. It is also close to Starbucks and a terrific Mexican restaurant with outdoor dining, Dali’s Kitchen. . . . The point is, if I lived at this home with a view of William Land Park, I would be dining almost nightly at Dali’s Kitchen.” Weintraub specifically calls out the name of the restaurant to advertise how close that house is to delicious food.

Agents use your favorite neighborhood restaurants to market your house and its community in a few ways:

1. They call out five-star restaurants or hole-in-the-wall treasures in the listing description.
2. They tell buyer’s agents the top restaurants they can tell their clients about.
3. They talk up amazing eats at the open house.

In your next meeting with your real estate agent, tell them about your favorite restaurants in the area. They can use those trendy or quaint spots to advertise your house and your neighborhood’s charms.

2. Buyer’s Agents Meet Clients at Restaurants to Show Off the Location

Buyer’s agents will use restaurants to show off the location and help their clients settle on a house. Realtor® Alex Boylan told us, “Sometimes when I have a first-time client meeting and I know they want to be in a certain area, we’ll meet at the coffee shop or the local restaurant and I’ll tell them, ‘This is a part of the community!’ That is a selling point for the community they want to be in.”

This immersion in the neighborhood helps buyers get a solid grasp of its vibe and culture. It’s similar to exploring a city for the first time—you wouldn’t visit the tourist traps to get to know what it’s really like. You’d walk up and down the city’s streets, find a coffee shop, and sit there for a while. That’s what buyer’s agents do to give their clients a more complete picture of the area.

Boylan even goes the extra mile and “buys gift cards for the clients as welcome home gifts for moving into the neighborhood so they can visit their local restaurants.”

The best way you can get buyer’s agents to show their clients the great restaurants in your area is to communicate with your own real estate agent. They can talk to top buyer’s agents at their firm and in the area to make sure they know the hot spots and family-friendly joints perfect for a coffee meeting that shows off the neighborhood.

3. Seller’s Agents Use Restaurants to Attract Buyers with Active Social Lives

Restaurants are an important part of social life for millennials, and nearby eateries are also a big draw for couples and families who take their kids out to eat after school or after activities on the weekend. Without nearby spots, these clients are forced to travel farther to meet up with friends or for a great meal, which isn’t ideal.

According to Weintraub, showing off the great restaurants in the area can be a big draw for millennials who brunch and party at the local haunts with their friends. She told us that “properly marketed, a hot-spot restaurant or even a trendy hole-in-the-wall near a group of homes is a big selling benefit to many millennials today. That particular buying group likes to meet friends at restaurants and watering holes. That’s their social life. They generally do not entertain at home.”

Take note of which restaurants you think your agent should use to market to specific types of buyers. For example, the pasta place with delicious spaghetti and paper tablecloths the kids can draw on is a great place to show off to families. The trendy bar-restaurant combo with the best cocktail in town is perfect for nightlife-hungry millennials. It really depends on your area, and your agent will know the type of buyer you’ll need to woo.

Your Local Food Scene Is One of Your Property’s Greatest Assets

The best way you can take advantage of your favorite restaurants is to tell your real estate agent about them. Though they will be a local expert and probably have a good idea of which eats are the best, they won’t know exactly which ones are your favorite and why. So tell your agent about the hole-in-the-wall diner that you love because your kids love the apple pie. Specifics like that help agents market your house even better.

As Boylan told us, telling buyers about the best restaurants really says, “Hey welcome to the community—now go enjoy it!”

Once you’ve successfully sold your own home by leveraging the power of your local eateries, you may be in the market for a new home—and a new mortgage. Find out everything you need to know about mortgages in our Mortgage Learning Center.

Image: mactrunk

The post How Real Estate Agents Use Your Favorite Restaurants to Sell Homes appeared first on Credit.com.

The 37 Most Profitable Markets for Home Sellers

When it comes to selling homes, some places are much more profitable than others.

It’s no surprise that certain areas are more profitable for home sellers than others, but it certainly is surprising which places those are. ATTOM Data Solutions, a property data company, just released its Q2 2017 U.S. Home Sales Report. They examined 118 metropolitan statistical areas with at least 1,000 home sales in the second quarter of 2017.

According to ATTOM Data Solutions, homeowners who sold in the second quarter gained an average price of $51,000 since purchase — the highest average price gain for home sellers since the recession. The last time gains were this high was in the second quarter of 2007 when sellers made an average profit of $57,000.

Profitable Places

Though the number’s not as high as it was 10 years ago, profits are looking up from the past few years. It looks like the second quarter of 2017 was a wise time to sell, but which markets had the highest sales?

While it’s important to choose the right location for real estate investments, it’s also important to have good credit. Poor credit can make it more difficult — and expensive — to buy and sell real estate. Before venturing into real estate, see where you stand. You can check two of your credit scores for free with Credit.com. You can also see just how much real estate you can buy with our How Much House Can You Afford? tool. Here are the areas where home sellers profited the most in the second quarter.

37. Las Vegas-Henderson-Paradise, Nevada

Average Homeseller Returns: 35%

36. Crestview-Fort Walton Beach-Destin, Florida

Average Homeseller Returns: 36%

35. Detroit-Warren-Dearborn, Michigan

Average Homeseller Returns: 37%

34. Cape Coral-Fort Myers, Florida

Average Homeseller Returns: 38%

33. Austin-Round Rock, Texas

Average Homeseller Returns: 38%

32. Lake Havasu City-Kingman, Arizona

Average Homeseller Returns: 38%

31. Spokane-Spokane Valley, Washington

Average Homeseller Returns: 39%

30. Salt Lake City, Utah

Average Homeseller Returns: 41%

29. Riverside-San Bernardino-Ontario, California

Average Homeseller Returns: 42%

28. Deltona-Daytona Beach-Ormond Beach, Florida

Average Homeseller Returns: 42%

27. Greeley, Colorado

Average Homeseller Returns: 43%

26. Eugene, Oregon

Average Homeseller Returns: 43%

25. Oxnard-Thousand Oaks-Ventura, California

Average Homeseller Returns: 44%

24. Nashville-Davidson-Murfreesboro-Franklin, Tennessee

Average Homeseller Returns: 44%

23. Provo-Orem, Utah

Average Homeseller Returns: 44%

22. Miami-Fort Lauderdale-West Palm Beach, Florida

Average Homeseller Returns: 45%

21. Sacramento-Roseville-Arden-Arcade, California

Average Homeseller Returns: 46%

20. Reno, Nevada

Average Homeseller Returns: 47%

19. Prescott, Arizona

Average Homeseller Returns: 47%

18. San Diego-Carlsbad, California

Average Homeseller Returns: 47%

17. Bremerton-Silverdale, Washington

Average Homeseller Returns: 48%

16. Urban Honolulu, Hawaii

Average Homeseller Returns: 48%

15. Stockton-Lodi, California

Average Homeseller Returns: 49%

14. Boulder, Colorado

Average Homeseller Returns: 49%

13. Vallejo-Fairfield, California

Average Homeseller Returns: 50%

12. Dallas-Fort Worth-Arlington, Texas

Average Homeseller Returns: 51%

11. Salem, Oregon

Average Homeseller Returns: 52%

10. Fort Collins, Colorado

Average Homeseller Returns: 53%

9. Los Angeles-Long Beach-Anaheim, California

Average Homeseller Returns: 53%

8. Boston-Cambridge-Newton, Massachusetts-New Hampshire

Average Homeseller Returns: 57%

7. Portland-Vancouver-Hillsboro, Oregon-Washington

Average Homeseller Returns: 59%

6. Santa Rosa, California

Average Homeseller Returns: 61%

5. Denver-Aurora-Lakewood, Colorado

Average Homeseller Returns: 62%

4. Modesto, California

Average Homeseller Returns: 62%

3. Seattle-Tacoma-Bellevue, Washington

Average Homeseller Returns: 63%

2. San Francisco-Oakland-Hayward, California

Average Homeseller Returns: 65%

1. San Jose-Sunnyvale-Santa Clara, California

Average Homeseller Returns: 75%

Image: Willard

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It’s Now Easier for Millions of Student Loan Borrowers to Get a Mortgage

Student loan borrowers who are making reduced income-driven repayments on their loans will have an easier time getting mortgages under a new policy announced recently by Fannie Mae.

Nearly one-quarter of federal student loan borrowers benefit from reduced monthly student loan payments based on their income, Fannie Mae says. However, there’s been some confusion about how banks should treat the lower monthly payments when they calculate a would-be mortgage borrower’s debt-to-income ratio (DTI): Should banks consider the reduced payment, the payment borrowers would have to pay without the income-based “discount,” or something in between?

It’s a tricky question, because student loan borrowers have to renew their qualification for the lower payments each year, meaning a borrower’s monthly DTI could change dramatically a year or two after qualifying for a mortgage. The banks’ confusion over which payment amount to use can mean the difference between a borrower qualifying for a home loan and staying stuck in a rental apartment.

There’s even more confusion when a mortgage applicant qualifies for a $0 income-driven student loan payment, or when there’s no payment amount listed on the applicant’s credit report. Previously, in that situation, Fannie Mae required banks to use 1% of the balance or a full payment term.

As of last week, Fannie has declared that mortgage lenders can instead use $0 as a student loan payment when determining DTI, as long as the borrower can back that up with documentation.

That announcement followed another Fannie update issued in April telling lenders that they could use the lower income-based monthly payment, rather than a larger payment based on the full balance of the loan, when calculating borrowers’ monthly debt obligations.

“We are simplifying the options available to calculate the monthly payment amount for student loans. The resulting policy will be easier for lenders to apply, and may result in a lower qualifying payment for borrowers with student loans,” Fannie said in its statement.

Taken together, the two announcements could immediately benefit the roughly 6 million borrowers currently using income-driven repayment plans known as Pay As You Earn (PAYE), Revised Pay As You Earn (REPAYE), Income-Contingent Repayment (ICR), and Income-Based Repayment (IBR).
Freddie Mac didn’t immediately respond to an inquiry about its policy in the same situation.

What This Means for Student Loan Borrowers Looking to Buy

Michigan-based mortgage broker Cassandra Evers said the changes “allow a lot more borrowers to qualify for a home.” Previously, there was a lot of confusion among borrowers, lenders, and brokers, Evers said. “[The rules have] changed at least five or six times in the last five years.”

The broader change announced in April, which allowed lenders to use the income-driven payment amount in calculations, could make a huge difference to millions of borrowers, Evers said.

“Imagine you have $60,000 in student loan debt and are on IBR with a payment of $150 a month,” she said. Before April’s guidance, lenders may have used $600 (1% of the balance of the student loans) as the monthly loan amount when determining DTI, “basically overriding actual debt with a fake/inflated number.”

“Imagine you are 28 and making $40,000 per year. Well, even if you’re fiscally responsible, that added $450-a-month inflated payment would absolutely destroy your ability to buy a decent home … This opens up the door to a lot more lenders being able to use the actual IBR payment,” Evers said.

The Fannie Mae change regarding borrowers on income-driven plans with a $0 monthly payment could be a big deal for some mortgage applicants with large student loans. A borrower with an outstanding $50,000 loan but a $0-a-month payment would see the monthly expenses side of their debt-to-income ratio fall by $500.

It’s unclear how many would-be homebuyers could qualify for a mortgage with an income low enough to qualify for a $0-per-month income-driven student loan repayment plan. Fannie did not have an estimate, spokeswoman Alicia Jones said.

“If your income is low enough to merit a zero payment, then it is probably going to be hard to qualify for a mortgage with a number of lenders. But, with the share of IBR now at almost a full 25% of all federally insured debt, it’s suspected that there will be plenty of potential borrowers who do,” Jones said. “The motivation for the original policy and clarification came from lenders’ requests.”

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