Real Estate infocus: April 2009

Friday, April 17, 2009

7. Don't spend all your money on the down payment.

If you're moving into your first home, you'll have to buy things you never needed before, such as lawn mowers, yard tools and major appliances. You'll need cash for these purchases unless you're planning to mire yourself in credit card debt.

Housing and Urban Development (HUD)

The U.S. Department of Housing and Urban Development. This is the agency responsible for enforcing the federal Fair Housing Act.

Federal laws that prohibit housing discrimination on the basis of race or color, national origin, religion, sex, familial status or disability.

The federal Acts apply to all aspects of the landlord/tenant relationship, from refusing to rent to members of certain groups to providing different services during tenancy.

related articles:

PHOTO GALLERY OF TERRACE HOUSE
PHOTO GALLERY OF BUNGALOW
PHOTO GALLERY OF MANSION
PHOTO GALLERY OF PUBLIC HOUSING
SINGLE FAMILY DETACHED HOUSE
PHOTO GALLERY OF CONDOMINIUM
PHOTO GALLERY OF TOWER CONDOMINIUM

Home Warranty

A service contract that covers a major housing system--for example, plumbing or electrical wiring--for a set period of time from the date a house is sold.

The warranty guarantees repairs to the covered system and is renewable.

A Home warranty is a service contract that covers the repair and replacement costs of home appliances.

The warranty generally covers equipment and appliances such as dishwashers, plumbing systems, electrical systems etc. that fail due to normal wear and tear.

Coverage varies significantly across warranty companies. Home warranty contracts do not cover all home repairs.

Basic coverage includes plumbing, electrical, heating systems and major appliances such as refrigerators, dishwashers, and ovens.

Many companies charge additional coverage for appliances such as clothes washers and clothes dryers, which are generally not covered.

6. Be ready to negotiate.

We got the sellers to lower their price by $7,000 and throw in a one-year home warranty, which will cover the cost of repairing or replacing the home's mechanical systems and major appliances. And we got a good deal on our homeowners insurance, with guaranteed replacement coverage at no extra cost.

5. Pay attention to the little things.

Because I thought I needed to rush to buy a home, I wasn't as objective during our home search as I should have been. When we finally walked into a house that met many of our requirements, we turned a blind eye to some things we should have paid closer attention to. And because the inspection didn't turn up any major problems, we decided to look past the minor ones. Well, it's the little things that can become big headaches once you move into a home.

Pay attention to how a home smells. A strong odor — especially a musty one — can be an indication of a bigger problem such as mold.
Look at small details, not just the big picture. If there are cobwebs in the corners, dirty windows, weeds in the lawn and leaves in the gutters, the sellers obviously didn't do a good job of keeping the property clean. If they haven't taken the time and money to maintain the little things, there's a chance they've let big things, such as plumbing or the heating and cooling system, fall into disrepair.

Don't think just because the house needs a few minor repairs or new paint on the walls, it will be cheap, quick and easy to tackle. Before you know it, the costs add up, it's taken a lot more time than expected and you've had to call in the experts to finish the jobs you couldn't handle on your own.

4. Accompany the inspector.

Most stories on homebuying advise you to have a home-inspection clause in your contract, giving you the right to have the property inspected and to withdraw your offer if the inspection report isn't satisfactory to you for any reason. What these stories often neglect to mention is that you should be present during the inspection. We weren't because we didn't want to spend the money on a flight to Kentucky. Now we know it would have been money well spent.

Sure, you'll get an inspection report. But it can be difficult making heads or tails of it. If you're present during an inspection, you can see problems with your own eyes, get an idea of how serious they are and ask the inspector how much he might think it will cost to repair them.

3. Find the perfect homefety

Realize you won't find the perfect home. Forget the idea of finding your dream home. It doesn't exist. You will not find a house that has everything you want, and none of the things you don't. Real-estate agents tell you to make a list of what's important to you — size, condition, location, style and price. That way you can zero in on a home that comes closest to suiting your wants and needs.

We wanted an old home with hardwood floors, a small yard, a garage that didn't face the street and a basement. We got a newer home with wall-to-wall carpeting, a big yard, a garage in the front of the house and a crawl space. That's because we had to give up some things to get others — like a big kitchen and plenty of bedrooms.

2. Take your time.

We thought we were ahead of the game by looking on the Web for homes. But every house we found online that we really liked was snatched up before we had a chance to go to Kentucky to check them out. I started to worry that if we didn't move fast enough, all the "good" houses would be gone.

By the time we actually went to Kentucky to look at homes, we had only two months before my husband had to start his new job. I was determined to find something — anything. My husband, the levelheaded one, urged me not to rush. Did I listen? No. As a result we settled for a house that had only a few of the things I wanted and many of the things I didn't want.

In retrospect, I realize homes constantly come on (and off) the market. You might not find your dream home, but you don't have to settle for any old house just because you feel under the gun to buy something. Consider renting to give yourself time to find the right home.

1. Lay the groundwork.

Our first step was figuring out how much house we could afford and how much we could borrow. If you're moving to a new community, be sure to find out what home prices are there. Housing prices can change dramatically from state to state and even city to city. You might also want to talk to friends or colleagues in the area about neighborhoods and other considerations only a local might know.

Tips for Housing Maintenace 1

Planned repair

Planned Repairs are non-urgent repairs or general maintenance jobs which will prevent your home falling into serious disrepair.

* Renewal of internal and external doors or windows.
* Renewal of baths, basins and toilets.
* Renewal of kitchen units and worktops.
* Rewiring (where this is not detrimental to health and safety of household).
* Renewal of paths (giving access to front or back doors) fences and gates.
* Repointing.
* Broken fences and gates.
* Badly fitting doors and windows.
* Replacement gutters and down pipes

Tips for Housing Maintenance 2

Priority three

Routine Repairs are non-urgent, everyday repairs which need to be carried out as a result of normal usage.

* Landlords lighting (only one or two lights affected)
* Minor repairs to external doors and window frames
* Minor plastering
* Running overflows in the spring and summer months

Priority four

* Small renewals, i.e. wc pans, cisterns and taps

Priority five

* Loose or broken gutters,
* Cracked windows
* Dripping cold taps
* Reglazes

Tips for Housing Maintenance 3

Priority two

Urgent Repairs are not emergencies but need to be carried out quickly in order to prevent further damage or discomfort.

* A partial loss of water or electricity supply
* A complete loss of heating and hot water sometime between April and October
* A partial loss of heating and hot water at any time of year
* Minor plumbing leaks
* A partly blocked sink
* A blocked bath or basin
* Running overflows
* Leaking hot taps where boiler fired up

Tips for Housing Maintenance 4

Priority one

Emergency repairs are those that need to be done when you, your home, or surrounding homes are in danger.

* Fire damage
* Severe water leaks
* A total loss of water
* Unsafe gas or electricity
* A gas leak in the home
* A total loss of heating and hot water sometime between November and March
* Blocked toilet or drain (when only one wc in the property)
* Making a property safe after a break-in
* Gain access after tenant has lost keys
* Jetting main drainage system

Thursday, April 9, 2009

Know The General Rule

The general rule is that you are not responsible for normal wear and tear. For example, if the dishwasher must be replaced because it has simply worn out, that's the landlord's responsibility.

If you or your guest cause damage by your unreasonable carelessness or deliberate misuse, however, you must pay for it. The cost of replacing the dining room carpet because your fish tank sprang a leak will properly come out of the deposit. You must leave a rental at least as clean as it was when you moved in.

Because "normal wear and tear" can be interpreted many different ways, disputes often arise. The bottom line is that the better you itemize and document the condition of your unit when you move in, the better case you'll have against a landlord who tries to gouge you on the way out.

Tuesday, April 7, 2009

Homeowners Association

An organization comprising neighbors concerned with managing the common areas of a subdivision or condominium complex. These associations take on issues such as salting and sanding a subdivision when it snows and collecting dues from residents.

The homeowners' association is also responsible for enforcing any covenants, conditions & restrictions that apply to the property.

A homeowners' association (abbrev. HOA) is a legal entity created by a real estate developer for the purpose of developing, managing and selling a development of homes.

It allows the developer to exit financial and legal responsibility of the community, typically by transferring ownership of the association to the homeowners after selling off a predetermined number of lots.

It allows the municipality to increase its tax base, but reduce the amount of services it would ordinarily have to provide to non-homeowners association developments. This article covers this type of HOA.

Most homeowners' associations are non-profit corporations, and are subject to state statutes that govern non-profit corporations and homeowners' associations. State oversight of homeowners associations is inconsistent from state to state.

Some states have a strong body of homeowner association law such as Florida and California, and some states have virtually no homeowner association law such as Massachusetts.

Sunday, April 5, 2009

Tenant Rights

Tenant rights can either refer to the rights tenants enjoy by law, or to the movement to acquire such rights. Tenant rights generally seek to protect renters from landlord neglect and unfair eviction, as well as secure fair, affordable housing.

Laws dealing with the landlord-tenant relationship vary greatly between jurisdictions. These laws may provide some or all of the following for tenants:

remedies for bad conditions
privacy protections
protection from landlord retaliation
protection from exorbitant rent increases
protection for the right to organize
Just cause eviction controls

1. Bring your paperwork.

I myself have an experience when we are (NPA) "No Permanent Address"period.
The best way to win over a prospective landlord is to be prepared.
To get a competitive edge over other applicants, bring the following when you meet the landlord: a completed rental application; written references from landlords, employers, and colleagues; and a current copy of your credit report.

2. Review the lease conditions

Carefully review all of the conditions of the tenancy before you sign on the dotted line.

Your lease or rental agreement may contain a provision that you find unacceptable --

for example:

restrictions on guests.

pets.

design alterations.

running a home business.

3. Make all verbal talking in writing

To avoid disputes or misunderstandings with your landlord, get everything in writing.

Keep copies of any correspondence and follow up an oral agreement with a letter, setting out your understandings.

For example:

if you ask your landlord to make repairs, put your request in writing and keep a copy for yourself. If the landlord agrees orally, send a letter confirming this.

4. Always protect your rights

Next to disputes over rent or security deposits, one of the most common and emotion-filled misunderstandings arises over the tension between a landlord's right to enter a rental unit and a tenant's right to be left alone.

If you understand your privacy rights

(for example, the amount of notice your landlord must provide before entering)

it will be easier to protect them. For more information,

5. Always tell to them all necessary repairs needed

Know your rights to live in a habitable rental unit -- and don't give them up.
The vast majority of landlords are required to offer their tenants livable premises :

adequate weatherproofing.

heat.

water.

electricity.

clean.

sanitary.

structurally safe premises.

If your rental unit is not kept in good repair, you have a number of options, ranging from withholding a portion of the rent, to paying for repairs and deducting the cost from your rent, to calling the building inspector
(who may order the landlord to make repairs)
to moving out without liability for your future rent. For more information,

6. Be open, talk to them

Keep communication open with your landlord.

If there's a problem --

for example:

if the landlord is slow to make repairs -- talk it over to see if the issue can be resolved short of a nasty legal battle.

7. Get Insurance

Your landlord's insurance policy will not cover your losses due to theft or damage. Renters' insurance also covers you if you're sued by someone who claims to have been injured in your rental due to your carelessness.

Renters' insurance typically costs $350 a year for a $50,000 policy that covers loss due to theft or damage caused by other people or natural disasters; if you don't need that much coverage, there are cheaper policies.

8. Security deposit protection

To protect yourself and avoid any misunderstandings, make sure your lease or rental agreement is clear on the use and refund of security deposits, including allowable deductions.

When you move in, do a walk-through with the landlord to record existing damage to the premises on a move-in statement or checklist.

Know the Requirements for Safety

Learn whether your building and neighborhood are safe, and what you can expect your landlord to do about it if they aren't.

Get copies of any state or local laws that require safety devices such as deadbolts and window locks, check out the property's vulnerability to intrusion by a criminal, and learn whether criminal incidents have already occurred on the property or nearby.

If a crime is highly likely, your landlord may be obligated to take some steps to protect you.

Properly Fight an Eviction Notice

Know when to fight an eviction notice -- and when to move. If you feel the landlord is clearly is the wrong
(for example, you haven't received proper notice, the premises are uninhabitable)

you may want to fight the eviction. But unless you have the law and provable facts on your side, fighting an eviction notice can be short-sighted.

If you lose an eviction lawsuit, you may end up hundreds (even thousands) of dollars in debt, which will damage your credit rating and your ability to easily rent from future landlords.

Know your rights as a tenants

Know your rights when you rent a house or apartment. Make sure the dealing is follow according to what is suppose to be with regards to your Verbal and Written admission.

Renter's Right

Get Your Security Deposit Back
Don't let your landlord stiff you -- know the law.

Most states hold landlords to strict guidelines as to when and how to return security deposits. Landlords who violate these laws can be held to stiff penalties.

Most states hold landlords to strict guidelines as to when and how to return security deposits. The general rule is that you are not responsible for normal wear and tear.

If you cause damage by your unreasonable carelessness or deliberate misuse, however, you must pay for it.

Landlords are typically required to return your security deposit, or give you an itemized accounting of the deductions from your security deposit, within 14 to 30 days after you move out.

Mortgage

A loan in which the borrower puts up the title to real estate as security (collateral) for a loan.
If the borrower doesn't pay back the debt on time, the lender can foreclose on the real estate and have it sold to pay off the loan.
A loan used to finance the purchase of real estate, generally with specified payment periods and interest rates.

A mortgage is the transfer of an interest in property (or the equivalent in law - a charge) to a lender as a security for a debt - usually a loan of money. While a mortgage in itself is not a debt, it is the lender's security for a debt.

It is a transfer of an interest in land (or the equivalent) from the owner to the mortgage lender, on the condition that this interest will be returned to the owner when the terms of the mortgage have been satisfied or performed.

In other words, the mortgage is a security for the loan that the lender makes to the borrower.

Short sale (of house)

A sale of a house in which the proceeds fall short of what the owner still owes on the mortgage. Many lenders will agree to accept the proceeds of a short sale and forgive the rest of what is owed on the mortgage when the owner cannot make the mortgage payments.

By accepting a short sale, the lender can avoid a lengthy and costly foreclosure, and the owner is able to pay off the loan for less than what he owes.

When a property owner fails to make their mortgage payments for a number of months they are in default. The first step of the foreclosure process (which typically takes a number of months) that the lender will take is to file the notice of default.

This is a public document that is recorded. The property owner will contract to sell the home conditioned upon the lender accepting a lesser amount than what is owed on the mortgage. Note that there are no similarities between a real estate short sale and selling a stock short.

In many jurisdictions, including the United States, the seller is responsible for taxes on the amount of the mortgage left unpaid after the sale as ordinary income.

Short sale (real estate)

In real estate, a short sale is a sale of real estate in which the proceeds from the sale fall short of the balance owed on a loan secured by the property sold.

In a short sale, the bank or mortgage lender agrees to discount a loan balance due to an economic or financial hardship on the part of the mortgagor.

This negotiation is all done through communication with a bank's loss mitigation or workout department. The home owner/debtor sells the mortgaged property for less than the outstanding balance of the loan, and turns over the proceeds of the sale to the lender, sometimes (but not always) in full satisfaction of the debt.

In such instances, the lender would have the right to approve or disapprove of a proposed sale. Many Short Sales leave a deficiency balance for which the Mortgagor / Borrower is still liable.

In 99% of all cases it is not a settlement-in-full. A deficiency balance will remain as a potential liability for the Mortgagor / Borrower.

The bank's opportunity of pursuit of a deficiency judgment will vary from state to state. Extenuating circumstances influence whether or not banks will discount a loan balance. These circumstances are usually related to the current real estate market and the borrower's financial situation.

A short sale typically is executed to prevent a home foreclosure, but the decision to proceed with a short sale is predicated on the most economic way for the bank to recover the amount owed on the property.

Often a bank will allow a short sale if they believe that it will result in a smaller financial loss than foreclosing as there are carrying costs that are associated with a foreclosure. A bank will typically determine the amount of equity (or lack of), by determining the probable selling price from a Broker Price Opinion BPO or through a valuation of an appraisal.

For the home owner, advantages include avoidance of a foreclosure on their credit history and partial control of the monetary deficiency. A short sale is typically faster and less expensive than a foreclosure.

In short, a short sale is nothing more than negotiating with lien holders a payoff for less than what they are owed, or rather a sale of a debt, generally on a piece of real estate, short of the full debt amount. It does not extinguish the remaining balance unless settlement is clearly indicated on the acceptance of offer.

Short sales are common in standard business transactions in recognition that creditors are not doing debtors a favor but, rather, engaging in a business transaction when extending credit.

When it makes no business sense or is economically not feasible to retain an asset, businesses default on their loans (called bonds). It is not uncommon for business bonds to trade on the after-market for a small fraction of their face value in realization of the likelihood of these future defaults.