Qualified Mortgage, High Cost Mortgages and Higher-Priced Mortgage Loans

Today we are discussing the Qualified Mortgage (QM), including the proposed rule in keeping with the Ability to Repay (ATR) standards which will have an effect on the QM. You have to determine the appropriate points and fees due to strict limits if planning on originating a QM. Concurrently you must also understand finance charges for purposes of calculating the annual percentage rate (APR) to determine whether legal safe harbor or rebuttable presumption applies to this QM. The yardstick for a QM with legal safe harbor or one with rebuttable presumption is determined by whether or not the loan is considered a higher-priced mortgage loan (HPML). The future revisions to HPMLs will be discussed later on.

The general purpose of the ATR standards is presented as, "A creditor may not make a covered transaction unless the creditor makes a reasonable and good faith determination at or before consummation that the consumer will have a reasonable way ability to repay the transaction according to its terms."

Covered Transaction: (effective on January 10, 2014)- the ability to repay standards applies to all consumer credit transactions, secured by a dwelling and is subject to Regulation Z (TILA). There are exemptions for home equity lines of credit (HELOC) and timeshares.

Choices- if a covered transaction, you can originate a loan that is compliant with:

• Ability to Repay standards; or,
• A Qualified Mortgage with legal safe harbor (deemed compliant); or,
• A Qualified Mortgage with rebuttable presumption )presumed compliant); or,
• Other variances

Additional Variances to ATR- the following are also allowed variances from ATR standards.

• Refinancing a nonstandard mortgage into a standard mortgage by current holder or servicer acting on behalf of current holder
• Small Creditor (Balloon loans)- if you are a small creditor meeting the following criteria, balloon loans are allowable:
• 50% od first lien loans originated are in rural or underserved areas
• The creditor originated 500 or fewer first lien loans the prior year
• The creditor has less than 2 billion in assets
• The creditor must retain the loan for 3 years unless the loan is sold to another similar qualifying creditor meeting this criteria

Standard Mortgage:

• No negative amortization
• No interest only loans
• No balloon loans
• Total points and fees do not exceed a QM
• The loan term does not exceed 40 years
• Interest rate is fixed for at least the first 5 years and, proceeds used solely for: paying off the outstanding principal balance on the nonstandard mortgage; and to pay closing or settlement charges

Nonstandard Mortgage

• A covered transaction that is:
• An adjustable-rate mortgage, with an introductory fixed interest rate for a period of one year or longer;
• An interest only loan; or,
• A negative amortization loan

Ability to Repay Requirements: the following requirements are applicable under the ATR rules: Underwriting- underwriting must consider the following factors:

• Current or reasonably expected income or assets, excluding the value of the secured property
• If relying on current employment income- the current employment status (i.e. full-time, seasonal etc.)
• The qualifying monthly payment must be based on substantially equal, fully amortizing payments and the higher of fully indexed rate or introductory rate and must also include all the monthly payment for any simultaneous loans known. If the simultaneous loan is also a covered transaction the same criteria applies as on the subject loan regarding monthly payment. If the simultaneous loan is a HELOC, the periodic payment on the amount of credit to be drawn at or before the subject loan must be used.
• The monthly mortgage related obligations for qualifying purposes must include: real estate taxes; hazard insurance, flood insurance, mortgage guarantee insurance, and any other required insurance; homeowners' and condominium association dues; ground rent or leasehold payments; and special assessments
• Qualification ratios include all current debts, obligations, alimony and child support
• Qualification includes consideration of the debt-to-income ratio (DTI) or residual income guidelines (residual income guidelines may likely be based on VA loan residual income guidelines but are not yet defined in the rule)
• Credit history

Verification: the information in the loan file must be verified using: reasonably reliable third-party records; third-party records must provide reasonably reliable evidence of income or assets; a verbal verification of employment status is allowable if the creditor prepares a record of the information; and, there is no requirement to independently verify a debt shown on application that is not shown on the credit report, if the credit report is used for debt obligation verification.

Qualified Mortgage- the following requirements are necessary to comply with QM standards:

The only difference between originating a QM loan with legal safe harbor (deemed compliant) or a QM loan with rebuttable presumption (presumed compliant), is whether or not the loan is categorized as a higher-priced mortgage loan (HPML). 

QM- Legal Safe Harbor

•  Non Higher-Priced Mortgage Loan

QM- Rebuttable Presumption

• Higher-Priced Mortgage Loan (HPML)

The following terms apply to a QM:

• Regular substantially equal, periodic payments, except ARM or step-rate
• No negative amortization, interest only (or any deferred repayment), or balloon loans
• Max 30 year term

Maximum Points and Fees- the points and fees determinations are discussed in the earlier articles in this series and are based on the same calculations used for High Cost Mortgages:

3% -- $100,00 or more

$3,000 --  $60,000 to less than $100,000

5% -- $20,000 to less than $60,000

$1,000 -- $12,500 to less than $20,000

8% -- less than $12,500

• Note: the ATR/QM rule added additional fees for these purposes applicable to affiliates of the creditor and in addition loan originator compensation. There are industry associations, as well as a bill pending in congress to address the issues relative to loan originator compensation, specifically the fact that the manner in which the rule currently addresses this issue is that the loan originator compensation would be double-dipping if already included elsewhere (i.e., origination fee, etc.). You will want to seek out clarification of this requirement when we receive the final rule based on the concurrent proposed rule issued with this rule.

HUD Wants to Ensure FHA Loans Qualify for Safe Harbor

National Mortgage News
HUD Wants to Ensure FHA Loans Qualify for Safe Harbor

The Department of Housing and Urban Development is reviewing the qualified mortgage rule and it may modify the safe harbor provision for Federal Housing Administration-insured loans.

The QM ability to repay rule issued by the Consumer Financial Protection Bureau (CFPB) provides legal safe harbor for QM loans when the interest rate doesn't exceed the average prime offer rate by more than 150 basis points.

Once the 150 basis point line is crossed, the lender is more vulnerable to litigation when borrowers default.

"We are assessing what the appropriate safe harbor line is for the FHA QM rule. And we are aware of the potential impacts of higher mortgage insurance premiums and the 3% points and fees test," said HUD official in response to an inquiry.

In terms of the 150 bps, "we need to get that pricing right in order to ensure broad enough access to FHA," HUD secretary Shaun Donovan told members of the Mortgage Banking Association at their annual meeting in Washington. "That is the primary issue we are looking at," he added.

As you know a few months ago, FHA revealed that it would issue its own version of the QM rule, which permitted under the Dodd-Frank Act.

Mortgage Rates Heading Toward All-Time Lows

Mortgage rates moved closer to historic lows this week, lender Freddie Mac said Thursday, on a combination of an improving housing market and fears that consumers are pulling back on spending. 


The average for a 30-year fixed-rate mortgage was 3.41 percent, down from last week's 3.43 percent. At this point last year, the rate averaged 3.9 percent. This is the third straight week of declines for fixed-rate mortgages. 

The rate on a 15-year mortgage averaged 2.64 percent this week, down from 2.65 percent last week and 3.13 percent last year at this time.

Frank Nothaft, vice president and chief economist at Freddie Mac, said in a statement that weak consumer spending reports contributed to the decline. Retail sales fell for the second time in three months in March. And an index of consumer sentiment dropped this month to its lowest point since July. 

IDS Named One of Mortgage Technology's 2013 Top 50 Service Providers

Mortgage Technology's 2013 Top 50 Service Providers

The Top 50 Service Providers are recognized for their accomplishments in four criteria- continued advancement of technology and services, viable revenue model and value proposition to customers, exceptional customer service and unique impact on the mortgage industry.

The vendors named to the list have a proven track record in the industry and provide innovative technology and services to lenders, services and other industry participants.

Achieving the level of excellence required to be named a Top 50 Service Provider takes the right mix of wit, careful planning and flawless execution, not unlike the skills a sly wordsmith employs to solve the craftiest of crossword puzzles- albeit in a much higher-stakes venture.

Mortgage Technology has recognized top-performing industry companies for more than a decade, dating back to when its "Top 100 Technology Vendors" list debuted in the July 2002 issue. IDS is honored to be a part of the Top 50 List for the second year in a row. It is a great achievement to be recognized with other service providers of such caliber.

"IDS implemented updates to the user interface of its document preparation software to improve Web browser compatibility and navigation. Draper, Utah-based IDS was the inaugural recipient of the Lenders' Choice Mortgage Technology Award, which recognizes the technology providers that offers the best customer service, value proposition and overall user experience, as chosen my MT's Top Tech-Savvy Lenders and Servicers."

"IDS first priority is the experience of our clients while in the idsDoc system. We want to provide the best technology without sacrificing the customer service that goes a long with it," said IDS Executive Vice President, Mark Mackey. "We are thrilled to be a part of the Top 50 list and it goes to show all the hard work we put into our product and technology has paid off," added Mackey.

Make it Tuesday? (Oops)

I missed Make it Monday so to improvise I am doing a Make it Tuesday! Today I will show you a DIY teeth whitening that really works. 

Why Docs In Motion?

Many people stop by the IDS booth while at a mortgage conference and wonder... why biking? That doesn't have to do with mortgage documents. Well IDS wants everyone's Docs to be in motion at all times keeping their business going efficiently and effortlessly. 

We understand not every lender needs or even wants the exact same off the shelf doc prep system. This is exactly why IDS takes customization seriously and to a level no one else can compete on. By carefully listening to our clients and taking their feedback to heart, the constant evolution of our application has quickly propelled IDS to premier status and industry leader. It is our goal to turn your obstacles into finely tuned enhancements that helps to keep your docs in motion at all times. 

Many Doubt Housing Recovery is Underway

Economist have declared the end of the housing crisis, some as long as a year ago. Real estate agents in some market in some markets say sales are surging, with many houses attracting multiple offers. Even some builders are going full bore again.

But the America public still doesn't buy it, according to a new national survey commissioned by the John D. and Catherine T. MacArthur Foundation.

The telephone interviews of 1,433 adults over a two-week period in late February/early March found that while the financial markets and sales data may suggest the prolonged housing crisis is over, the American public is not ready to agree. The survey as well as a series of ten focus groups were conducted by Hart Research Associates.

Signs of life in the housing market? Maybe, but only for a relatively small 20% of the respondents. Most of the rest (77%) believe they're still in the middle of the crisis, with 19% of those still thinking the "worst is yet to come."

What's more, said researcher Rebecca Naser, is that's "the prevailing view" across the country, across all regions and all parts of the public.

"There is remarkable uniformity in the belief that it is premature to declare the end of the housing crisis," the report said.

At the same time, while ownership remains a goal of nearly one in four, the survey also found that the appeal of ownership isn't what it used to be.

For one thing, the crisis has touched nearly half the public at some point in their lives. And 20% still characterize their situations as only somewhat secure at best. For another, three out of five adults- not just renters- now believe "renters can be just as successful as owners in achieving the American dream."

That is, after decades of equating ownership with motherhood and apple pie, the housing crisis has changed how people feel about their housing choices. Indeed, a near majority (45%) would consider renting some time in the future. This compares to 20 to 30 years ago, said Naser, when half that percentage would consider renting.

"This is personal for people," the researcher said. "The collateral impact of the last seven to eight years is profound. There has been a shift in lifestyle, culture and the way people want to live their lives. And I think we're just seeing how fast and how far attitudes have changed."

But renting or buying, the study found, the public understands the vital role that stable housing markets plays for families and communities.

For example, 77% said a challenging housing situation would have a negative impact on the relationship between parents, 73% said it would challenge the mental health and well-being of family members, and 66% said it would impact the children's ability to do well in school.

Likewise, access to decent, 73% said affordable housing would have a positive impact on neighborhood safety, 71% said it would have a positive effect on the community's economic well-being and the kids ability to perfom in school, and 70% said it would play well for both individual and family security.

Consequently, after being provided with information about U.S. housing policy and demographic and lifestyle changes, more than three in five self-identified Democrats, Republicans and Independents believe the "focus on our housing policy should be fairly split between rental housing and housing for people to own."

"In contrast to the partisanship political discussion in Washington today," the study said, "the public has a balanced and realistic view about national housing policy."

Now days people are thinking differently. There's more openness to renting. It's a more appealing option for a lot of people in different stage of their lives. Renting use to have a definite stigma attached to it, but attitudes have dramatically changed over the last generation. Renting is now acceptable, renters are no longer seen as second-class citizens, and the public is much more willing to look at policy changes.

In such an unsteady environment with uncertainty of what our economy will do next leaves a lot of people taking the safer route of renting than purchasing a homes that they might not be able to afford soon down the road.

How do you feel about the housing industry and where we are going? Are you optimistic or still being cautious? Let us know your thoughts.

The Unintended Consequences of QM

MortgageOrb: The Unintended Consequences of QM

The "law of unintended consequences" has become part of mortgage originators' lexicon over the past few years. Typically applied in description of the unforeseen effects of enacted legislation, this "law" has been particularly relevant as of late with regard to the Consumer Financial Protection Bureau's (CFPB) new Ability to Repay rule and Qualified Mortgage (QM) protection for originators.

The premise of the new rule, as outlined in the Dodd-Frank Act, is relatively straightforward" "creditors are required to make a reasonable, good faith determination of a consumer's ability to repay. "Lenders can further protect themselves from legal liability by adhering to a higher standard that includes a 43% debt-to-income (DTI) ratio and a 3% fee cap.

Taken at face value, these rules make a certain amount of sense: Make sure the borrower can repay the loan for which they are applying. Loans with high rates and fees that are offered to the borrower who may have significant existing non-mortgage debt obligations make it harder for the borrower to repay and, therefore, more risky for the lender to extend credit.

We, as an industry, intuitively understand that. The rub, as they say, lies in those pesky unintended consequences- in this case, the effect that tighter lending standards will have on the number of eligible borrowers available, particularly lower income borrowers.

In the first place, there appear to be differing opinions on just how many borrowers could potentially be shut out of the primary mortgage market. Some industry observers have openly stated that restrictions like the DTI and fee caps, and even the 10% down payment requirement being floated in the upcoming qualified residential mortgage standard, could potentially jettison more than 40% of all borrowers from the pool. Contrast that with the CFPB's own studies, which indicate less than 15% of borrowers could be affected. Either way, that is still a significant hit to overall volume.

Furthermore, the 3% cap on fees is a tough standard, especially when applied to smaller loans. Since it costs about the same for a lender to originate a small loan as a large one, the cap could make it difficult to turn a profit. In an industry where margins are already tight, this will most definitely have a disproportionate impact on low- to moderate-income Americans who would be more likely to seek smaller, affordable mortgage in line with their ability to repay.

It is hoped that the limited seven-year exemptions for loans issued by the government-sponsored enterprises or insured by the Federal Housing Administration will allow for some flexibility here. Most loans with a high DTI ratio qualify for one of these exemptions. However, it is unclear what effect the expiration of these exemptions will have on the market.

There is also the rather thorny issue of affiliated business arrangements (ABAs). It is clear that the CFPB truly believes banks double-dip by virtue of these relationships. Surprisingly, many banks with ABAs appear to be digging in their heels, unwilling to divest their title and appraisal companies, as had be widely expected. 

Under the new rules, these companies will be challenged by punitive fee calculations for the 3% cap compared to their competitors that have no such relationships. This, in turn, reduces choice and competition that naturally benefits borrowers.

Each of these challenges may have a direct impact on low- and moderate-income borrowers, which returns us directly to the core issue our industry has faced for the last four-plus decades- by tightening credit standards, large groups of under served consumer will not have access to credit, resulting in them never being able to share in the opportunity to become a homeowner.

Further complicating matters is the fair lending disparate impact rule recently released by the U.S. Department of Housing and Urban Development. If a lender were to deny a loan based on the fact that it is not a QM, that would be a neutral policy that does not intentionally discriminate against one group or another, yet the lender could potentially be found to have engaged in discriminatory behavior if their Home Mortgage Disclosure Act data shows a disproportionately low amount of lending to people in protected groups. 

As a result, the disparate impact rule may be the hammer the government has to finally force the industry to start making a significant volume of unprofitable loans, which could, as an unintended consequence, result in driving up the costs of new loans for all consumers.

Currently, there is a proposed amendment that may address some of these concerns. However, it seems like most of the amendment's attention is focused on getting temporary exemptions for special loans designed to help struggling borrowers through current economic crisis rather than on long-term solutions to housing inequities.

In the coming months, we will see all of this play out. The CFPB has assumed a very active role in assisting the industry with the challenges presented. One of their next steps is to develop an "implementation plan" and "readiness guides" to help the industry better understand the new rules. Then, we will see ongoing updates to the official interpretations published as more and more questions come to light.

Top Five Technology Predictions for 2013

TOP FIVE TECHNOLOGY PREDICTIONS FOR 2013

The mortgage industry has been through a tough few years- the recession and an increasingly stringent regulatory regime have seen to that. For some the use of mortgage technology has mirrored the sector's fortunes, with many mortgage industry professionals only acquiring software solutions that were absolutely necessary to keep them in business.

Over the past few months, however, more and more mortgage industry professionals are starting to look at technology in a whole new light. The market is as the 'new normal' with some limited growth forecast and opportunities for business efficiency are clearly being seen. The question is now less 'What technology must I have to stay compliant and keep my business afloat?' and more 'What can I adopt and roll-out to make my business work better, more efficient and more profitable?'

With that in mind, Mark Lofthouse, CEO of mortgage technology solutions provider, Mortgage Brain, offers his top five technology predictions for 2013.

1. The Rise of the iPad: By the end of 2013 Lofthouse predicts that between a quarter and a half of technology savvy mortgage professionals will have purchased an iPad for 'business use' and will be using it as part of their mortgage advice and sales process. The iPad has become a firm favorite in terms of household gadgetry- there are plenty of other tablet offerings but the iPad remains the clear front runner- and with the advancement of professional apps and tablet compatible software programs  it's quickly becoming the new must have tool for the businessman or woman on the go. It's small and portable but built with enough power to operate many of the systems professionals need to support a mortgage sales. It means they can do business whenever and wherever the client requires- and that is bound to result in healthier sales and happier customers.
2. Why no website?: Whilst many mortgage professionals are forging ahead, an astonishingly large number still seem to be living in the technological dark ages and haven't got a website or any online presence at all. For good or ill, society is now going online to source more and more of its needs. And that includes financial services and looking for mortgage advice and tools. If you don' t have a website how are your customers going to find you?
3. Going mobile... The seemingly inexorable rise of apps has led to increasing numbers of existing software systems becoming mobile and it is expected to see a major shift towards online systems via the use of tablets and html solutions during 2013.
4. Consumers in the driving seat: Traditionally, financial advice was a face to face process from beginning to end. And while a mortgage professionals expertise can and never will be replaced when it comes to working out the finer details, consumers are increasingly undertaking much of the initial research themselves. For consumers taking their first steps in the mortgage market, today it's the internet and tomorrow it will be the internet, mobile devices and tablets. This isn't a great surprise. Consumers have been driving technological advances in other areas of life for years and the mortgage industry is just catching up. If the industry doesn't evolve alongside customer requirements over the next 12 months, they'll soon be left behind.
5. Point-of-Sale adoption for lenders: The introduction of the MMR will bring about a number of substantial changes in the way that lenders can discuss the mortgage needs of their customers. To remain compliant and transparent lenders now have to treat customers in a similar way to that offered by brokers for years and give advice and ensure that everything is logged and can be audited.  As such the mortgage market will see the results of lenders reviewing their point-of-sale and compliance systems during 2013 should they wish to give advice. Aldermore, for example, was recently announced as becoming the first lender to adopt our new Lender Retail point-of-sale solution, and more are due to announced shortly.

So will these predictions prove accurate? We'll find out as the year progresses. 

MortgageOrb: Working in a New Playing Field, Complete With New Headaches

Working in a New Playing Field, Complete With New Headaches

Disruptions in critical markets are known to bring regulatory change. What is known, but less talked about, is that these changes sometimes result in unintended consequences that further burden market participants and often run counter to the intended effect of the change. 

It is no secret that the mortgage market lacks liquidity in the form of a private secondary market and that the market would likely crumble without the ongoing support of the federal government. Most impartial observers would agree that measures should be taken to increase the attractiveness of investment in mortgages for the private market.

Although most of the talk in the mortgage servicing industry centers on servicers' preparedness for new rules about to take effect, could new liability and risk imposed on servicers alter the liquidity of loans and mortgage servicing rights (MSRs)? This is particularly important in terms of its effects on seasoned loans trading in the secondary market. 

Liquidity is obviously the Holy Grail for any normally functioning market, and providing a base for transparency and liquidity in the private mortgage market is supposedly a goal of all the government intervention into the market since the crisis began. But if owners of mortgages and MSRs are ultimately liable for compliance, and the loan has been sold from previous owners/servicers, will buyers be willing to accept that liability?

Or will large pools of private capital stay away from the mortgage market as a result of the increased liability? Most importantly, for the buyers who are willing, will this translate into higher risked-based premiums, thereby lowering the price buyers are willing to pay to acquire loans?

More drastically, will this shift in liability mean that bank and non-bank servicers eventually have to hold reserves against servicing-related ongoing liability after portfolio and MSR sales that contain representations and warranties for prior servicing practices? As the largest bank servicers look to shed loans and MSRs, will the financial pendulum swing back in their favor as they would represent the lowest counterparty risk? Most buyers are not equipped to assess counterparty risk as it relates to loan servicing. 

Our industry has spent a great deal of time debating ways to bring greater certainty to originators with respect to repurchase liability. From Fannie and Freddie to the Dodd-Frank Act, we have all acknowledged that there is a need to define time limits and implement a default causality standard around the ongoing liability of originating a loan. Should we now think about applying the same logic to new servicing standards and rules?

Some servicers may be able to differentiate themselves by managing the ongoing liability and confidently making representations and warranties about their servicing practices during the time they were responsible for servicing loans. But it is likely that will not apply to all servicers.

A Closer Look 

To date, the majority of the scrutiny placed on servicers has focused on the foreclosure process and the attendant fallout of robo-signing. The new servicing rules announced in January by the Consumer Financial Protection Bureau expand that focus to a larger segment of servicing portfolios by creating rules for, most, notably, hazard insurance, payment application and adjustable-rate mortgage (ARM) changes.

The issue could become partially acute when loans are transferred multiple times and current owners/servicers of the loans are unwilling to make assurances that all previous payments were applied timely and correctly, that the ARMs were adjusted appropriately, and that all partial payments and escrows were administered in the correct manner. While those functions apply to a majority of loans serviced, we still need to consider the more complex compliance regulations around the default servicing functions- bankruptcy, loss mitigation and foreclosure.

Servicers that want to retain the ability to sell their loans and MSRs for the maximum price will need to have a comprehensive auditing program in place to be able to confidently state that they adhere to the new compliance standards. That process starts with full documented policies and procedures, as well as loan-level testing that verifies adherence to each stated policy.

Many servicers are rushing to fortify their policies and to implement testing as a further mediation measure. Vendors in the loan file review space are busy creating technology that assists in the process and adds rigor to testing servicing practices.

Clearly, these items will add to the cost of servicing and the cost of compliance- costs that no doubt the industry will have to address. Most likely, it will mean passing those new costs back to borrowers in some fashion. In the future, the industry may not only have to grapple with the cost of compliance- and, by definition, the correlating potential cost of non-compliance- but also hope that the market remains liquid.

It is too early to assess the effect these new rules will have on liquidity in the secondary mortgage market, and we all hope that the effect is nominal  But with any new compliance burden placed on business, we would do well to keep in mind Newton's Third Law of Motion: For ever action, there is an equal and opposite reaction. Let us maintain a guarded optimism that the new rules have the intended reaction.

Make It Monday: Add Feng Shui to Your Tiny Apartment

Add Some Feng Shui to Your Tiny Apartment

Living in a tiny space doesn't mean you have to sacrifice design or in our case, feng shui. Here are some basic guidelines for maintaining food flow, however small your space may be. 

Establish the command position
In feng shui, the command position, or power spot, is the point of the room where you feel safest and most in command. In this case, it is often the space located directly opposite of the door. You can easily see the entryway, thus giving you the best control (both visually and physically) of your space. If you're living in a studio apartment, this will mean that you'll have to decorate and rearrange furniture around your bed. Try using room dividers to make your space feel more like a larger apartment.

Declutter your life
This is an important standard not just in feng shui, but in all aspects of life. Physically clutter translates into emotional turmoil and can leave you feeling unnecessarily stressed. As always, you can use self-storage to take care of any excess furniture you can't part with quite yet. If you find yourself pressed for space, but unwilling to invest in self-storage, storing vertically can be a lifesaver and will offer some unique and practical wall decorations.

Incorporate mirrors
The number one problem with small spaces is that they're too small for your big world. Mirrors are the key to bypassing this conundrum. Not only will they give your apartment the impression of being more spacious than it actually is, but they'll easily place you in the command position, as they enable you to see what's going on behind you at all times. 

Additionally, keep visible knickknacks as decorations to a minimum. If you do have too many decorative objects, try to organize them together as a group. Overall, your objects and furniture should accompany and complement one another, not compete for attention.

Keep your entryway clear
In feng shui, the three most important spaces are the kitchen, the entryway and the bedroom. If you live in a tiny apartment or studio, then most likely these are your only spaces. the important thing is to make sure that your entryway is clear. Avoid cluttering your pathways as well so that good energy can flow throughout your apartment easily.

Personalize to make yourself feel 'at home'
It can be difficult to feel "at home" and truly personalize your apartment if you know that you'll only be staying there for a short amount of time. Even so, good feng shui means truly feeling comfortable and in tune with your living space. Surround yourself with artwork or decorations that are inspirational to you to encourage good energy. If you're thinking about painting walls, make sure you unify the color and theme with the room at large, accommodating the existing color of your furniture or making changes accordingly to fit your new color template.