buyers – Gloria Benaroch Sea Bright NJ Broker Associate

What’s the Difference Between a Hard and Soft Credit Check?

Gloria Benaroch — Mon, 23 Jan 2023 15:40:16 +0000

What’s the Difference Between a Hard and Soft Credit Check?

– UPDATED: AUGUST 2, 2022

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When a lender or creditor is considering offering you a line of credit or a loan, they’ll check your credit to help determine whether or not to lend you money.

These inquiries can take the form of a hard inquiry, which does affect your credit score, or a soft inquiry, which does not. The type of credit inquiry performed will depend on the person or company pulling your credit information.

In this article, we’ll explain the differences between the 2 types, give you some common examples of both, and let you know how much each type will impact your credit.

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What Is a Hard Credit Check?

A hard inquiry (or hard pull) is used to determine whether or not you’re eligible to be given a loan or credit card. If you apply for credit — like a mortgage, auto loan, or credit card — the lender will check your credit report and credit score from 1 or more of the major credit bureaus.

When a company requests a hard inquiry on your credit, it will receive your entire credit report, which will show things like lines of credit, loans, your payment history, and any amounts that went to or are currently in collections. It can also include additional places that you might have applied to get credit — whether that’s a car loan, mortgage, student loan, or credit card.

Because these inquiries are tied to an actual credit application, they’re considered hard inquiries, and they can affect your credit score. Your permission (via credit card application, mortgage application, etc.) is required for lenders to make hard inquiries on your credit. These pulls can lower your score, especially if you have several of them within a short time span. Credit inquiries make up 10% of your overall FICO score.

Image Credit: Olleg via Shutterstock

Who Uses Hard Inquiries?

Hard inquiries are used by companies to make sure you’re likely to pay back the loan you’re requesting or the lease you’re signing.

Here are the most common users of hard inquiries:

Lenders and Credit Card Companies

Lenders and credit card companies use a hard inquiry to make an informed financial decision on whether or not to loan you money or a line of credit. This will be the case whether you’re applying for a mortgage, a student loan, or a new credit card.

One exception is with some banks that have specific requirements, such as “receiving a bonus within the past 48 months” or Amex’s “1 bonus per card per lifetime” policy. If you’ve been denied a credit card based on these reasons, you usually won’t see a hard inquiry show up on your credit report. This is because banks typically use the information they have on file for you to conditionally approve or deny you prior to pulling your credit.

Landlords

Landlords can choose to run either hard or soft credit inquiries. Usually, when you submit an application for an apartment, the landlord will include a form that will ask your permission to run a credit check. Some landlords go through third-party background and screening companies who do a hard pull since you must give your Social Security number.

This isn’t always the case as landlords can choose to use services offered by 1 of the 3 major credit bureaus instead. These are considered soft pulls and the landlord will receive a modified report.

Common Hard Inquiries

The most common hard inquires will occur when you submit:

Apartment rental applications
Auto loan applications
Credit card applications
Mortgage applications
Personal loan applications
Student loan applications

How Hard Inquiries Impact Your Credit Scores

Applying for a credit card or a loan will result in a hard inquiry on your credit report. As we noted earlier, inquiries make up 10% of your overall FICO score.

But how will your overall score be impacted? Well, 1 hard inquiry might lower your score from 0 to 5 points, depending on your credit history. If you have even more inquiries, this will be further magnified. In general, once you hit 7+ inquiries on your credit report, you should expect to see a significant drop of 50+ points in your credit score.

This shouldn’t be a reason to avoid applying for credit since a hard inquiry is required to get the credit card or loan that you want. If your score is high enough, it will have little impact (if any) on your creditworthiness.

Problems arise when you have too many hard inquiries in a short period of time. This can be concerning to lenders since it’s a sign of poor money management — opening a lot of new credit accounts may mean you’re having trouble paying bills and are at risk of overspending.

Bottom Line:Unfortunately, there isn’t a simple answer to how much your score will be impacted by a hard inquiry — this will vary based directly on your individual credit history and the number of inquiries on your credit report. The good news is that unless you are carrying out multiple hard checks, it’s unlikely to have much of an impact in the long term.

How “Rate Shopping” Is Treated

What do you do if you’re looking to get a mortgage or an auto loan and want to make sure you’re getting the best rate? The good news is that rating agencies understand that several inquiries in a short period of time (30 days per FICO’s scoring model) are common when looking for the best rate, and they’ll group those inquiries into a single hard inquiry on your report.

Note that this occurs only if the inquiries are for 1 category of qualified loans — a mortgage, auto loan, or student loan. While a hard inquiry will always impact your credit score, this grouping of inquiries results in a smaller impact than multiple, separate inquiries.

Hot Tip:Hard inquiries are rarely the reason you might be denied credit since they don’t affect your credit score as much as other factors like credit utilization and length of credit history.

How Long Inquiries Stay On Your Credit Report

We recommend checking your credit report at least once a year to ensure that all of the information is accurate. You’re entitled to 1 free report per bureau per year through AnnualCreditReport.com. These reports will show all of your financial accounts along with any hard inquiries on your report.

Hard inquiries remain on your credit report for just over 2 years, but FICO weighs them less as time passes. Even if you have multiple hard inquiries in a span of just a few months, it’s still unlikely a potential lender will give them too much consideration.

How To Dispute Inaccurate Hard Inquiries

If you’re checking your credit report as we’ve recommended above, be sure to look for any inquiries you don’t recognize. This could be a sign that someone may have applied for a fraudulent credit account in your name. Also, simple errors in classification can happen.

Either way, if you spot an erroneous pull, notify the credit bureau immediately to dispute it. Write a letter explaining the error and include a copy of your report with the error highlighted or circled.

The bureau will investigate and respond within 30 days. Credit bureaus are legally required to remove the hard inquiry from your report if it is inaccurate, and once it’s removed, you should see your credit score return to its prior level. You should also reach out to the financial institution that ran the credit check to let them know that you did not request it.

Hot Tip:Read our complete guide on how to dispute errors on your credit report.

What Is a Soft Credit Check?

A soft inquiry (or a soft pull) shows the same information that we’ve noted above for hard inquiries. This includes lines of credit, loans, your payment history, and any amounts that went to or are in collections.

Unfortunately, due to the nature of soft inquiries, they can occur without your permission. The good news is that because soft inquiries aren’t tied to any applications for credit that you’ve done yourself, they’re only visible on your own credit report with a few exceptions:

Insurance companies may be able to see other insurance companies’ soft inquiries.
Inquiries by debt-settlement companies you have authorized to access your report may be shared with your current creditors.

Who Uses Soft Inquiries?

Since soft inquiries don’t require your approval, it’s important to know who can access them — here are the most common users of soft inquiries:

Yourself

The most common instance of a soft inquiry would be when you monitor your own credit report. This includes services you use to monitor your credit score, like Credit Karma (review) or Mint. These can be pulled weekly, monthly, or as you request them.

Employers

The modified credit report that potential employers see is not the same report that you (or even other lenders) see. According to a 2018 HR.com report, 16% of companies pull credit or financial checks on all job candidates and almost 33% do credit checks on some candidates.

Credit Card Companies

Credit card companies are often the biggest users of soft inquiries — and they usually happen without your approval. This is because they use these soft pulls as a way to see if you’re prequalified for a credit card. Similar to what an employer sees, credit card companies won’t see information like your account numbers but will see things like your payment history and if you have any accounts in collections.

The companies will then send you the offers that might appeal to you to try to entice you to sign up for a new card. This can definitely get annoying (and take up plenty of space in your inbox!), but companies are hoping that one of the offers you see might catch your eye and will be too good to pass up.

Insurance Companies

If you get auto insurance, homeowners insurance, or any other insurance quotes in the mail, this will also involve a soft pull. Again, these happen without your authorization and are used to give you an accurate quote based on your credit history.

These insurance companies don’t see your regular credit score, but rather what’s called a credit-based insurance score. They see a score that’s similar to your FICO score but is weighted a little differently.

Pre-employment Soft Credit Checks

While you might expect insurance and credit card companies to check your score, it could come as a surprise to see that employers also perform this somewhat sensitive background check. Let’s take a closer look at what is and isn’t permitted, as well as how to be prepared for the situation.

What Will a Prospective Employer Look For?

Potential employers often use credit checks as a way to determine if you’re a responsible person. They can see information such as your mortgage, outstanding balances, auto or student loans, late or missed payments, bankruptcies and foreclosures, and accounts that have gone to collections.

Having some negative items on your credit report doesn’t mean you won’t get the job, but lots of late payments or bills in collections can let employers know that you have a hard time staying organized with your money. While they’ll be able to see information dating back 7 years, more recent information will typically be weighted more heavily in any decisions they make.

What Positions Do Credit Checks Apply To?

An employer can run a credit check for any role if they wish, although it is unlikely to have too much impact on their final decision unless you’re applying for a role that requires you to regularly handle money.

Jobs where your credit score might have more of an impact on an employer’s choice to hire you or not include:

Finance management
Banking
Accounting
Retail jobs

A bad credit report will not automatically deny you a role in any of these industries, but it might make it harder for a prospective employer to know they can trust you.

What Is the Process?

The check will take place once an employer is prepared to offer you a job (or, as is sometimes the case with current employers, a promotion). They’ll reach out to a third-party company to perform a check on your financial history.

The report itself will be carried out in much the same way as if you yourself were checking your own score. The employer will be provided with financial factors such as:

Credit and debit card debt
Mortgage payments
Loan repayments
The late payment of debts
Any cases of bankruptcies

Despite seeing this relatively sensitive information, an employer will be restricted from gaining access to most of your personal data. For example, your date of birth will not be included, so as to prevent any kind of age discrimination when assessing your application.

What Are Your Rights?

The Fair Credit Reporting Act (FCRA) protects your rights and makes it so that employers must have written consent before pulling your credit history. This might be done as part of your application process, or they may ask for your permission later on in the interview process.

This modified credit check won’t show your credit scores or any account numbers. It also won’t show any information that could violate equal employment regulations, like your birth year or marital status.

In addition, there are some cities and states that restrict credit checks as part of the decision for employment:

California
Chicago
Colorado
Connecticut
Delaware
District of Columbia
Hawaii
Illinois
Maryland
Nevada
New York City
Oregon
Philadelphia
Vermont
Washington

How To Be Prepared for Pre-employment Checks

While you won’t be able to make drastic changes to your credit score in the time between applying for a job and any potential pre-employment check, there are steps you can take to be as prepared as possible for any tricky questions.

Understand your score. Put the power back in your hands by gaining a detailed understanding of your own score. If you think your report might not represent you well, form responses as to why that might be the case. An employer may be willing to overlook a poor score if you can clearly highlight how it has no bearing on your job performance.
Check for errors in your report. Checking your score before you apply also gives you the chance to identify and dispute any errors which may have been falsely included. You’ll be given the chance to file a 100-word statement that disputes any misinformation, which an employer should be able to see when carrying out a check. Even if a lender doesn’t agree with your statement, it can go a long way to looking better in the eyes of a prospective employer.
Think about where you’re applying. The weight an employer places on your credit score will naturally vary, depending on a number of factors. Chief amongst those is the sector you’re applying to, as well as the size of the company in question. If you’re worried your credit score is going to impact your application, think about applying to smaller companies, which are more likely to overlook a bad report.

Bottom Line:Employers don’t always run your credit, but if your job involves company finances, it’s likely they will.

Common Soft Inquiries

As a quick recap, the most common soft inquiries will happen when:

You check your own credit score (annual or continuous monitoring)
Employers run your background check
Companies “prequalify” you for a credit card or insurance

How Soft Inquiries Impact Your Credit Score

While hard and soft inquiries show the same information, the main difference is that soft inquiries have no effect on your credit score. They aren’t even built into any credit-scoring models!

Soft inquiries are also not disputable. However, remember that potential lenders won’t be able to see them (except for insurance companies and debt-settlement companies as we’ve noted earlier).

How To Know if an Inquiry Will Be Hard or Soft

The difference between a hard and soft inquiry comes down to whether you gave the lender permission to check your credit or not. If you did, it will likely be reported as a hard inquiry. By signing a document, such as a credit card application, loan application, etc., you’re giving the company permission to pull your credit. If you didn’t sign any documents or otherwise approve a credit inquiry, it should be reported as a soft inquiry.

There are other types of credit checks that could show up as either a hard or soft inquiry. For example, utility, cable, internet, and mobile providers will often check your credit. If you’re unsure how a particular inquiry will be classified, you can always ask the company, credit card issuer, or financial institution to clarify before you sign any documents or turn in your application.

Image Credit: Casper1774 Studio via Shutterstock

Managing Your Credit

Try to keep hard inquiries on your credit to a minimum since it can signify that you’re over-extending your finances and aren’t a reliable borrower. You don’t want your credit score to suffer by applying for too many credit cards or other loans.

Apply for Loans Sporadically

The easiest way to keep credit inquiries from affecting your score is to manage how often you’re applying for loans or lines of credit. Be mindful of opening a lot of new credit accounts within the 2-year window when inquiries show up on your credit report. If possible, wait until some inquiries drop off before applying for additional credit.

In addition, shopping for multiple rates within 30 days is grouped together and treated by FICO as 1 inquiry. If you’re shopping for the best rate for a mortgage, car loan, etc., try to do all of your loan applications within this timeframe.

Avoid Getting Denied

While the denial itself won’t hurt your score any more than an approval, you may still see a drop in your credit from the hard inquiry. One of the worst things would be to have this hard inquiry show up on your account and not even be approved for the loan or credit card!

Be aware of the loan or card requirements. If you’re knowledgeable about your current credit score, you can try to only apply for the loans or credit cards that you feel reasonably sure you’ll qualify for.

Improve Other Aspects of Your Score

While credit pulls can lower your score by 3 to 5 points (per inquiry), this doesn’t have a huge effect on your credit. Your credit utilization makes up a much larger chunk of your credit score. There isn’t 1 magic percentage to hit, but the lower you keep it, the better. That means you shouldn’t be spending up to the maximum of your credit line each month.

The length of your credit history is also an important contributor to your credit score. This is important to remember when you’re considering closing some of your older credit and loan accounts.

Check Your Credit Frequently

Checking your own credit report regularly will never affect your credit and it can help you keep up to date on any major changes to your score. You can also monitor for any hard inquiries in case you need to dispute an erroneous item.

Also, keep in mind that each of the 3 reports could have different inquiries, as an inquiry is only added to the specific credit report that was checked. For example, if you check your Equifax credit report, the soft inquiry won’t be added to your Experian or TransUnion credit reports.

Consider Soft Pull Credit Card Approvals

There are a few credit card issuers that perform a soft inquiry (as opposed to a hard inquiry) when you apply for a credit card. These cards are generally targeted at those individuals with bad credit. The issuers do a soft inquiry to confirm your identity, but it’s still possible that they’ll have to do a hard inquiry if they need to gather more information.

Before you consider a card that doesn’t require a hard pull, make sure you do your research and read the fine print carefully. There are usually higher APRs and harsher penalties for missing payments attached to these cards.

Freezing Your Credit

By placing a freeze on your credit, hard inquiries can’t occur, stopping any new accounts from being opened in your name. This might be a good option for you, especially if you’ve been the victim of identity theft or a data breach.

Not sure if a credit freeze is right for you? Here’s more information about what it means to freeze your credit (and when it’s a good idea).

Hot Tip:Keep in mind that while hard inquiries can be stopped by freezing your credit — soft inquiries can’t.

Top Credit Statistics for 2021-2022

Average Credit Score by Age

As of August 2021, the average credit score for an American citizen was a respectable 716 – placing them comfortably in the “Good” bracket. This was 8 points higher than the last reported average (in October of 2020).

Interestingly, although perhaps to no great shock, it seems the more experience you have under your belt has a positive impact on your score. Statistics showed that the 3 best average scores by demographic were for those aged 70 to 79, 80 to 89, and 90 to 99.

Image Credit: Upgraded Points

Average Credit Score by State

When it came to the U.S. state with the best average score, Minnesota led the way with an average of 739. The top 5 best scores across the country were:

Minnesota – 739
Wisconsin – 732
South Dakota – 731
Vermont – 731
North Dakota – 730

Meanwhile, at the other end of the spectrum, the states which had the lowest scores on average were:

Nevada – 695
New Mexico – 694
Arkansas – 690
Oklahoma – 690
South Carolina – 689

Average Credit Score

Image Credit: Upgraded Points

Encouragingly, when it came to the bracket which most Americans found themselves in (as of April 2021), the highest percentage were those in an “excellent” score of 800 to 850. The full breakdown showed:

300 to 499 – 3%
500 to 549 – 5.4%
550 to 599 – 7.1%
600 to 649 – 9.2%
650 to 699 – 12.5%
700 to 749 – 16.4%
750 to 799 – 23.1%
800 to 850 – 23.3%

With trends continuing to show an improvement in scores of the average American, it will be interesting to see how long this healthy period sustains.

Additional Resources

If you’d like to find out more about hard and soft credit checks, as well as how you can optimize your credit report as best as possible, be sure to check out these handy secondary sources:

Equifax assess 5 things that will negatively impact your credit score
Investopedia provides tangible advice on how to improve your credit score
The Muse provides a detailed list of actionable advice for managing your finances
Wells Fargo provides advice on how to easily check your score
Check out our extensive list of credit report statistics for the 2021 financial year

Profiles To Follow for Financial Advice

While you probably have a better footing for how your credit score will be affected by different checks, it never hurts to follow some reliable sources for up-to-date advice. Here are some of the best Twitter accounts to keep up with for advice on your credit report:

Credit Score Secrets — A great profile that provides interesting new ideas on helping your credit score.
Credit Sesame — A great resource for growing your score.
Debt.com — A profile with resources to help people fix credit card debt, tax debt, student loan debt, credit report errors, ID theft issues, bankruptcy, and more.
George Daunis — George shares wisdom on subjects such as boosting your credit score, home buying, being a landlord, blogging, social media, and online income generation.
How To Raise My Credit Score — Enjoy advice from credit repair experts who can help get your finances back on track for the future ahead.
Lexington Law — This group believes in your legal right to a fair, accurate, and substantiated credit report.
OneScore — This profile is from a great app to check and improve your credit score for free.

Final Thoughts

Both soft and hard credit inquiries are done to assess the state of your credit. Soft inquiries are done constantly to track your own credit score or by companies to preapprove you for credit cards or loans. These won’t affect your credit.

It’s very important to monitor and manage any hard inquiries you have to your credit report. Hard inquiries are necessary to get approved for many types of loans and can even be performed by your future employer to see if you’re a good candidate. These can affect your credit score and stay on your credit report for 24 months.

Featured Image Credit: comzeal images via Shutterstock

Frequently asked questions

What is a hard credit inquiry?

If you apply for credit, the lender will check your credit report (make a hard inquiry) from 1 or more of the major credit bureaus in order to see if you’re eligible to be given a loan or credit card.

Can you remove hard inquiries from your credit report?

If hard inquiries are fraudulent or erroneous, you can request them to be removed from your credit report. If hard inquiries occurred as a result of you applying for a new loan or credit card or filling out a rental agreement, they can’t be removed and will fall off your credit report after 2 years.

Are hard inquiries bad?

Hard inquiries are required for obtaining many types of loans, including student loans, auto loans, and mortgages. This means that hard inquires by themselves aren’t bad. It’s important, however, to limit the number of hard inquiries you have since each inquiry can drop your credit score multiple points, reducing the likelihood that you’d be able to obtain future lines of credit.

What is the difference between a hard inquiry and a soft inquiry?

While the information provided to potential lenders or creditors is the same, how inquiries are treated is different. Each hard inquiry will reduce your credit score by a few points. A soft inquiry will not impact your credit score at all. You will also not know when a company runs a soft inquiry, but you need to provide approval before a hard inquiry is run.

For additional reading, check the full guide here What’s the Difference Between a Hard and Soft Credit Check?

For addional reading check out this link Why Your Credit Score Still Matters When You Are Retired – https://landsbergbennett.com/blogs/insights/why-your-credit-score-still-matters-when-you-are-retired

2023 Housing Market What’s Happening

Gloria Benaroch — Sat, 07 Jan 2023 23:45:20 +0000

What’s Happening to the 2023 Housing Market

The National housing market is different from New Jersey’s; national houses increased a lot higher than New Jersey because the prices here are already up there. Our “correction” will NOT be the same as the rest of the nation.

Yes, the pace of home sales has noticeably declined. Yet there are pockets of areas in New Jersey that are still very active even with multiple offers.

Talking about a recession well that can be a self-fulfilling prophecy.

Housing markets that have not seen a rapid growth during the pandemic such as New Jersey, will continue a slower and steady appreciation this year.

It’s GOOD to be in New Jersey right now where there is a study demand.

Why this is not 2008…

Mortgages now are written with stricter credit guidelines than in 2006-2008.

In 2008 house prices dropped fast because borrowers could not afford the payments and did not have any equity cushion. Also there was a large inventory of new construction.

Today we have a severe shortage which will help boost the market.

Even if there were to be a severe recession, we’re not likely to see many foreclosures, because homeowners have a lot of equity in their properties and are more likely to sell before going into default.

New Jersey was a tight market before the pandemic and people were not selling because there wasn’t anything to buy.

Rates will definitely come down the second half of 2023, but not down to the 3% level.

Of course mortgage rates impact the supply and demand in the housing market.

When the rates come down or dip as they did last summer, we will see buyers coming back into the market very quickly.

Sellers right now are locked into very favorable rates, and they have no incentive to put their homes on the market, therefore the lack of inventory will persist.

The biggest issue is with the first time home buyers being squeezed out of the market between the higher rates and the high prices. We need first-time home buyers because it causes a chain reaction that allows move up buyers.
For every first time home buyer there are five transactions that happen.

We need creativity to keep the market moving.

NJHMFA New Jersey Housing Mortgage and Finance and the down payment assistance program is an incentive for first-time home buyers. The max down payment assistance is $10,000 and in 2023 it has been increased to $15,000 in 12 counties. This program is for qualified first-time homebuyers to use as down payment and closing cost assistance when purchasing a home in New Jersey AND is an interest-free, five-year forgivable second loan with no monthly payment.

Also NJHMFA offers competitive mortgage rates for those who use the down payment assistance program.

Another option for buyers is to consider a renovation loan most notable is the 203K from FHA, which combines remodeling costs and purchases into one loan.
Buyers are not taking advantage of this program.

Sellers offering to pay closing costs is coming back.

The other item sellers are starting to offer, is buying down the rate for the first couple of years because that is less expensive than reducing the price.

Buyers are now opting for ARM’s that are fixed for 5 to 7 years with plans to refinance before the ARMS adjust.

While the economy is in for a bumpy year, New Jersey housing market is likely to thrive.,

It’s good to be in New Jersey now.

Reasons To Be Glad That You Did Not Buy When Mortgage Rates Were Super Low

Gloria Benaroch — Fri, 07 Oct 2022 15:15:13 +0000

Reasons To Be Glad That You Did Not Buy When Mortgage Rates Were Super Low

Now that rates are 6 to 7% range some buyers feel that they missed a lifetime opportunity and regret not buying sooner.
Know that some buyers that did buy when the rates were low may want to switch places with you now even with higher interest rates in place.

People Who Bought Between 2021-2022 Have Some Of The Following Regrets

Fewer houses to choose from
Prices were constantly rising
Paying over asking price
Extreme pressure to make quick decisions
Not able to do research on the houses
Sometimes for going home inspections

Four Reasons Why Now May Be A Good Time To Buy

Hedge against inflation period stabilize your monthly payments against rising rents

More houses to choose from and lower prices. You can always refinance your mortgage when rates go down in the future.

Sellers have not had to negotiate on price or terms over the past couple of years, with the changing market sellers maybe more willing to negotiate.

It could become harder to get a mortgage because as recession happens mortgage companies become more cautious.

BOTTOM LINE

It is easy to feel like you missed an opportunity with low interest rates, however it is also easy to forget the downsides that came along with the low interest rates and not the benefits of buying now.

The market is never perfect!

You need to weigh the pros and cons for your situation

PROS TO BUYING NOW

Take advantage of house prices stabilizing or coming down
Hedge against rising rates, rent and inflation by buying a house
There are more homes to choose from now
More time to think about the options
More potential to negotiate

Every real estate market is different from one area to another. So, consult your real estate agent for an in-depth advice whether now is a suitable time for you to buy in your preferred area and price range

Ocean and monmouth county NJ Real Estate Sales

Gloria Benaroch — Mon, 23 May 2022 13:56:13 +0000

Ocean and monmouth county NJ Real Estate Sales

What You Need to Know About Moving to the Shrewsbury Area

Gloria Benaroch — Mon, 13 Dec 2021 04:06:13 +0000

Photo via Pexels

What You Need to Know About Moving to the Shrewsbury Area

Are you moving to Monmouth or Ocean Counties in New Jersey? You’ll love it here! Of course, whenever you’re relocating somewhere new, you’re bound to have a lot of questions. Whether you’re moving to Rumson, Sea Bright, or Shrewsbury, check out the following list of moving resources from Gloria Benaroch to help you settle into your new community!

Getting a Job in the Area

Check out the recent job openings in Shrewsbury and surrounding areas.
Don’t forget to consider remote job opportunities as well!

Setting Up Your Home

Get your utilities hooked up. You can find information about local utility companies on local government websites.
Remember to visit the local DMV to register your vehicle and update your license.
As you personalize your new home, consider having your lawn redone, which may involve having the landscape professionally graded.

Finding Your Local Go-To Spots

Whether you’re in the mood for barbecue or pizza, check out the best places to eat in and around Shrewsbury.
Check out some of the best parks in the region to find your new favorite outdoor escape.
Unwind after unpacking all your stuff with a trip to a local yoga studio.

Moving to a new city is always going to be challenging. It will take some time before you feel completely comfortable in an unfamiliar area, and there’s nothing wrong with that! Tackle those last few items on your moving checklist, look for a fulfilling job, and get out and explore the Tri-Cities with your family. You’ll feel at home before you know it!

Are you still looking for a house in or near Shrewsbury? Gloria Benaroch can help you find the right home for you and your loved ones. Give her a call or text at 732.245.4031 to arrange a consultation!

authored by: Mark Simons
msimons@localigraf.com

Home Sales About To Surge? We May See a Winter Like Never Before.

Gloria Benaroch — Sat, 20 Nov 2021 13:34:55 +0000

Home Sales About To Surge? We May See a Winter Like Never Before.

Like most industries, residential real estate has a seasonality to it. For example, toy stores sell more toys in October, November, and December than they do in any other three-month span throughout the year. More cars are sold in the U.S. during the second quarter (April, May, and June) than in any other quarter of the year.

Real estate is very similar. The number of homes sold in the spring is almost always much greater than at any other time of the year. It’s even labeled as the spring buying season. Historically, the number of buyers and listings for sale significantly increase in the spring and remains strong throughout the summer. Once fall sets in, the number of buyers and sellers typically drops off.

Last year, however, that seasonality didn’t happen. The outbreak of the virus and subsequent slowing of the economy limited sales during the spring market. These sales were pushed back later in the year, and last fall and winter saw a dramatic increase in home sales over previous years. The only thing that held the market back was the extremely limited supply of homes for sale.

What About This Winter?

Some experts thought we’d return to the industry’s normal seasonality this winter with both the number of purchasers and houses available for sale falling off. However, data now shows that neither of those situations will likely occur. Buyer demand is still extremely strong, and it appears we may soon see a somewhat uncharacteristic increase in the number of homes coming to the market.

Buyer Demand Remains Strong

The latest Showing Index from ShowingTime, which tracks the average number of monthly showings on available homes, indicates buyer activity was slightly lower than at the same time last year but much higher than any of the three previous years (see chart below):A report from realtor.com confirms buying activity remains strong in the existing home sales market:

“New housing data shows 2021’s feverish home sales pace broke a yearly record in October, . . . with last month marking the eighth straight month of buyers snatching up homes more quickly than the fastest pace in previous years. . . .”

Buyer activity for newly constructed homes is also very strong. Ali Wolf, Chief Economist for Zonda, recently reported that Stuart Miller, the Executive Chairman of Lennar, one of the nation’s largest home builders, said this about demand:

“There is still a great deal of demand at our sales centers with people lining up and not enough supply.”

The only question heading into this winter is whether the number of listings available could come close to meeting this buyer demand. We may have just received the answer to that question.

Sellers Are About To List – Right Now

Instead of waiting for the normal spring buying market, new research indicates that homeowners thinking about selling are about to put their homes on the market this winter.

Speaking to the release of a report on this recent research, George Ratiu, Manager of Economic Research for realtor.com, said:

“The pandemic has delayed plans for many Americans, and homeowners looking to move on to the next stage of life are no exception. Recent survey data suggests the majority of prospective sellers are actively preparing to enter the market this winter.”

Here are some highlights in the report:

Of homeowners planning to enter the market in the next year:

65% – Have just listed (19%) or plan to list this winter
93% – Have already taken steps toward listing their home, including working with an agent (28%)
36% – Have researched the value of their home and others in their neighborhood
36% – Have started making repairs or decluttering

The report also discusses the reasons sellers want to move:

33% – Have realized they want different home features
37% – Say their home no longer meets their family’s needs
32% – Want to move closer to friends and family
23% – Are looking for a home office

Data shows buyer demand remains unusually strong going into this winter. Research indicates the supply of inventory is about to increase. This could be a winter real estate market like never before.

Bottom Line

If you’re thinking of buying or selling, now is the time to have a heart-to-heart conversation with a real estate professional in your market, as things are about to change in an unexpected way.

Hope is on the Horizon for Today’s Housing Shortage

Gloria Benaroch — Tue, 15 Jun 2021 20:07:49 +0000

Hope Is on the Horizon for Today’s Housing Shortage

The major challenge in today’s housing market is that there are more buyers looking to purchase than there are homes available to buy. Simply put, supply can’t keep up with demand. A normal market has a 6-month supply of homes for sale. Anything over that indicates it’s a buyers’ market, but an inventory level below that threshold means we’re in a sellers’ market. Today’s inventory level sits far below the norm.

According to the Existing Home Sales Report from the National Association of Realtors (NAR):

“Total housing inventory at the end of April amounted to 1.16 million units, up 10.5% from March’s inventory and down 20.5% from one year ago (1.46 million). Unsold inventory sits at a 2.4-month supply at the current sales pace, slightly up from March’s 2.1-month supply and down from the 4.0-month supply recorded in April 2020. These numbers continue to represent near-record lows.”

Basically, while we are seeing some improvement, we’re still at near-record lows for housing inventory (as shown in the graph below). Here’s why. Since the pandemic began, sellers have been cautious when it comes to putting their homes on the market. At the same time that fewer people are listing their homes, more and more people are trying to buy them thanks to today’s low mortgage rates. The influx of buyers aiming to capitalize on those rates are purchasing this limited supply of homes as quickly as they’re coming to market.This inventory shortage doesn’t just apply to existing homes that are already built. When it comes to new construction, builders are trying to do their part to bring more newly built homes into the market. However, due to challenges with things like lumber supply, they’re also not able to keep up with demand. In their Monthly New Residential Sales report, the United States Census Bureau states:

“The seasonally‐adjusted estimate of new houses for sale at the end of April was 316,000. This represents a supply of 4.4 months at the current sales rate.”

Sam Khater, Chief Economist at Freddie Mac, elaborates:

“In the span of five decades, entry level construction fell from 418,000 units per year in the late 1970s to 65,000 in 2020.

While in 2020 only 65,000 entry-level homes were completed, there were 2.38 million first-time homebuyers that purchased homes. Not all renters looking to purchase their first home were in the market for entry-level homes, however, the large disparity illustrates the significant and rapidly widening gap between entry-level supply and demand.”

Despite today’s low inventory, there is hope on the horizon.

Regarding existing home sales, Sabrina Speianu, Senior Economic Research Analyst at realtor.com, explains:

“In May, newly listed homes grew by 5.4% on a year-over-year basis compared to the earlier days of the COVID-19 pandemic last year…

In May, the share of newly listed homes compared to active daily inventory hit a historical high of 44.4%, 17.3 percentage points higher than last year and 15.1 percentage points above typical levels seen in 2017 to 2019. This is a reflection of quickly selling homes and, for buyers, it means that while they can expect fresh new listings every week, they will have to be prepared to move quickly on desirable homes.”

As for newly built homes, builders are also confident about what’s ahead for housing inventory. Robert Dietz, Chief Economist at the National Association of Home Builders (NAHB), shares:

“Builder confidence in the market remains strong due to a lack of resale inventory, low mortgage interest rates, and a growing demographic of prospective home buyers.”

Things are starting to look up for residential real estate inventory. As the country continues to reopen, more houses are likely to be listed for sale. However, as long as buyer demand remains high, it will take time for the balance between supply and demand to truly neutralize.

Bottom Line

Although it may be challenging to find a house to buy in today’s market, there is hope on the horizon. Let’s connect to talk about your home search so we can find your dream home this summer.

Top 6 Home Organization Upgrades that “Spark Joy” for Buyers

tomato — Fri, 01 May 2020 19:41:23 +0000

Before You Start

Technology You Will Need

A CRM that contains your network’s contact information
- Learn more about CRMs and our recommended best practices here.
If you choose to use the Blog Post, you will need a website that allows you to create posts.
- As a Marketing Club member, the posts are uploaded automatically to your AgentID Site if you have it activated. Click on the “AgentID Site” course card in your Paperless Agent Dashboard to get started.
A way to customize the Report, which we offer in three formats. You only need to have one of these programs to edit the Report:
- Microsoft PowerPoint
- Apple Keynote
- Adobe Acrobat Reader (it’s free!)
A Facebook Page
- This can either be a Local Business Page or a Public Figure Page
- Review how to create a Facebook Business Page here.
A way to send emails
- Marketing Club members get access to an email marketing tool called the Marketing Suite through their membership. Review a tutorial of how to use the Marketing Suite here.
OPTIONAL: A LinkedIn Profile Page, an Instagram Account, a YouTube Channel

Essential Activities

Step 1: Post the Monthly Blog Post

The Monthly Value Program is released on the first day of the month. It is automatically published to your AgentID Site if you’ve set one up.If you haven’t set up your AgentID Site and would like to do so, access instructions here.

OPTIONAL: Customize the Post for Your Local Market

If you prefer to post the blog to your own website, click the image to download and then get the content by clicking the button below the image.

CLICK FOR MONTHLY BLOG POST CONTENT

DOWNLOAD BLOG CONTENT IN WORD (.DOCX) FORMAT

Need Help?

Editing a Blog Post on Your AgentID Site

Step 2: Send Monthly Email Template with Link to Blog Post

Step 3: Post Social Media Image with Link to Blog Post on Your Facebook Business Page

Step 4: Record 1-minute Video

Step 5: Individual Follow-up with Contacts

Optional Activities

Share to Instagram

Share to Pinterest

Share LinkedIn Post / LinkedIn Image

CLICK FOR POSTING TO LINKEDIN INSTRUCTIONSPost Image (Click to Download):

Post Content (Click to Copy):

Did you know your spring cleaning efforts could increase the value of your home? Find out the “Top 6 Home Organization Upgrades that ‘Spark Joy’ for Buyers” in my latest article.

Suggested Hashtags (click to copy):

#realestate #housing #springcleaning #tips #organization #mariekondo

Also include at least one local hashtag, ex: #austin #austinrealestate or #austinhomes

CLICK FOR LINKEDIN ARTICLE CONTENT

Need Help?

Learn how to setup your LinkedIn Profile with our LinkedIn Cheat Sheet

Print Report PDF (Expired Listing Packets and Open Houses)

Snail Mail PDF Report

Text Copied

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5 Real Estate Reality TV Myths Explained

tomato — Thu, 15 Aug 2019 19:05:19 +0000

5 Real Estate Reality TV Myths Explained

Have you ever been flipping through the channels, only to find yourself glued to the couch in an HGTV binge session? We’ve all been there, watching entire seasons of shows like “Property Brothers,” “Fixer Upper,” and “Love It or List It,” all in one sitting.

When you’re in the middle of your real estate-themed TV show marathon, you might start to think everything you see on the screen must be how it works in real life. However, you may need a reality check.

Reality TV Show Myths vs. Real Life:

Myth #1: Buyers look at 3 homes and decide to purchase one of them.
Truth: There may be buyers who fall in love and buy the first home they see, but according to the National Association of Realtors, the average homebuyer tours 10 homes as a part of their search.

Myth #2: The houses the buyers are touring are still for sale.
Truth: Everything is staged for TV. Many of the homes shown are already sold and are off the market.

Myth #3: The buyers haven’t made a purchase decision yet.
Truth: Since there is no way to show the entire buying process in a 30-minute show, TV producers often choose buyers who are further along in the process and have already chosen a home to buy.

Myth #4: If you list your home for sale, it will ALWAYS sell at the open house.
Truth: Of course, this would be great! Open houses are important to guarantee the most exposure to buyers in your area, but they are only one piece of the overall marketing of your home. Keep in mind, many homes are sold during regular showing appointments as well.

Myth #5: Homeowners decide to sell their homes after a 5-minute conversation.
Truth: Similar to the buyers portrayed on the shows, many of the sellers have already spent hours deliberating the decision to list their homes and move on with their lives and goals.

Bottom Line

Having an experienced professional on your side while navigating the real estate market is the best way to guarantee you can make the home of your dreams a true reality.

Starting the Search for Your Dream Home? Here Are 5 Tips!

tomato — Wed, 29 May 2019 02:05:37 +0000

In today’s real estate market, low inventory dominates the conversation in many areas of the country. It can often be frustrating to be a first-time homebuyer if you aren’t prepared.

In a realtor.com article entitled, “How to Find Your Dream Home—Without Losing Your Mind,” the author highlights some steps that first-time homebuyers can take to help carry their excitement of buying a home throughout the whole process.

1. Get Pre-Approved for a Mortgage Before You Start Your Search

One way to show you are serious about buying your dream home is to get pre-qualified or pre-approved for a mortgage before starting your search. Even if you are in a market that is not as competitive, understanding your budget will give you the confidence of knowing whether or not your dream home is within your reach.

This step will also help you narrow your search based on your budget and won’t leave you disappointed if the home you tour, and love, ends up being outside your budget!

2. Know the Difference Between Your ‘Must-Haves’ and ‘Would-Like-To-Haves’

Do you really need that farmhouse sink in the kitchen to be happy with your home choice? Would a two-car garage be a convenience or a necessity? Could the ‘man cave’ of your dreams be a future renovation project instead of a make-or-break right now?

Before you start your search, list all the features of a home you would like and then qualify them as ‘must-haves’, ‘should-haves’, or ‘absolute-wish list’ items. This will help keep you focused on what’s most important.

3. Research and Choose a Neighborhood You Want to Live In

Every neighborhood has its own charm. Before you commit to a home based solely on the house itself, the article suggests test-driving the area. Make sure that the area meets your needs for “amenities, commute, school district, etc. and then spend a weekend exploring before you commit.”

4. Pick a House Style You Love and Stick to It

Evaluate your family’s needs and settle on a style of home that would best serve those needs. Just because you’ve narrowed your search to a zip code, doesn’t mean that you need to tour every listing in that zip code.

An example from the article says, “if you have several younger kids and don’t want your bedroom on a different level, steer clear of Cape Cod–style homes, which typically feature two or more bedrooms on the upper level and the master on the main.”

5. Document Your Home Visits

Once you start touring homes, the features of each individual home will start to blur together. The article suggests keeping your camera handy to document what you love and don’t love about each property you visit.

Making notes on the listing sheet as you tour the property will also help you remember what the photos mean, or what you were feeling while touring the home.

Bottom Line

In a high-paced, competitive environment, any advantage you can give yourself will help you on your path to buying your dream home.