Piercy Group Realtors Blog

Happy Valentine's Day

2011-02-14T14:09:00.002-06:00

5 Reasons for a Mortgage Refinance

2011-01-24T18:45:00.000-06:00

5 Reasons for a Mortgage Refinance Other Than Lowering Your Payment
Article From HouseLogic.com

By: Barbara Eisner Bayer
Published: October 22, 2010

There's more to a mortgage refinance than lowering your monthly payments.
Naturally, if you're paying 6% for your mortgage and you can refinance at 5%, you're gonna do it. Although cutting your monthly payment remains an important motive, there are at least five other reasons to consider a mortgage refinance, for long-term savings and convenience.
1. Change your mortgage term
If you decrease the term of your mortgage in a refinance by going from a 30-year to a 15-year, you'll pay a lower interest rate and shorten your total interest costs. You'll build home equity more quickly, and pay off your loan sooner, even though your monthly payments go up.
2. Move from an adjustable rate to a fixed rate
ARMs offer low introductory rates, but they also offer long periods of uncertainty that make it hard to budget. It makes sense in a mortgage refinance to go from an ARM to a fixed-rate loan during a low-interest rate environment. You'll get emotional security and your rate won't fluctuate (http://www.houselogic.com/articles/do-adjustable-rate-mortgages-make-sense-now/) with changing economic conditions.
3. Take out cash
With a cash-out mortgage refinance, you can turn an intangible asset-accumulated home equity-into a tangible one-cash. It makes sense for a project that will generate long-term benefits, like a home improvement or funding a child's college education (http://www.houselogic.com/articles/deduct-mortgage-interest-home-equity-loans/). However, don't do it for frivolous reasons. Unless you're extremely disciplined, you could find yourself in even deeper debt.
4. Consolidate two mortgages
When interest rates are low, a mortgage refinance lets you consolidate your main mortgage and an outstanding home equity loan to realize a lower overall monthly payment. Plus, you'll have only one mortgage payment to make each month.
5. Recover from divorce
If your home is jointly owned with your soon-to-be ex-spouse, a mortgage refinance will turn a joint obligation into the responsibility of the person keeping the home. Nothing is more frustrating than tracking down a former spouse who doesn't keep up with his or her end of the mortgage payment.
Lay the groundwork
If one of these reasons resonates with you, contact your current lender to see if it'll offer you preferred rates or reduced closing costs on a mortgage refinance. But don't assume the current lender is best: Leave no stone unturned by searching for lenders online and calling community banks and local credit unions.

No matter which lender you choose, a mortgage refinance for the right reasons can save you lots of money-and that's the best reason of all.

Barbara Eisner Bayer has written about mortgages and personal finance for the past 16 years for the Motley Fool, Mortgages.com, and Nursevillage.com, and has been the Managing Editor of MortgageLoan.com, CompleteGrowth.com, and Credit-land.com. She has recently survived the challenge of refinancing her second home.

Are you using a RE/MAX Realtor?

2010-11-05T14:05:00.000-05:00

My babies at rest

2010-11-02T16:38:00.000-05:00

Cocoa Puff

Foxy Brown

Johan Sebastian

Virtual Tour - 5300 W. 71st Street, Prairie Village, KS 66208

2010-11-02T16:09:00.000-05:00

Beautifully updated ranch in Nall Avenue Gardens. New contemporary kitchen, updated bath, refinished hardwood floors, updated HVAC, new roof, gas fireplace, and fresh paint. Large fenced yard with deck and flower garden. Finished basement with media room and fourth non-conforming bedroom & still roof for expansion. New sump pump and french draine installed. Walk to Prairie Village shops, trails and parks! Click photo to preview home.

Virtual Tour - 2711 W. 73rd Street, Prairie Village, KS 66208

2010-11-02T15:15:00.000-05:00

Virtual tour of 2711 W. 73rd Street, Prairie Village, KS. This home has been reduced and is ready for a new owner! 3 bed, 1.5 bath, huge great room, hardwood floors and so much more. Expandable attic ready for a master suite. Click photo to preview this home.

Divorcees get tax break on home sale

2010-10-29T13:13:00.000-05:00

DEAR BENNY: My husband and I have a house entitled in joint tenancy, and I am filing a divorce. I left our house about two months ago. In less than two years my spouse will retire and that will give him time to sell the house.
For his convenience, I am planning to have as part of the divorce decree that the house be sold in no later than two years. My spouse can afford to pay the mortgage if he wants to stay through that period of time. We have no kids from our marriage, but I have two grown-up, married kids on their own already.
Will that be acceptable to the mortgage lender? Will this be a disadvantage to me? I am sorry if this last question is one that I should direct to a divorce attorney. --C.S.
DEAR C.S.: By all means, you have retained legal counsel and the specific advice you need should come from him or her. You have raised two questions: (1) Will the mortgage lender have any problems with your proposal? The short answer is no. So long as your ex-husband pays the mortgage, the lender will be happy.
(2) Will there be taxable consequences? From your question, I must assume that you will not transfer the house to your husband pursuant to the divorce decree, but, although you will move out of the property, you will both agree to sell it within two years.
In order to take advantage of the up-to-$250,000 exclusion of gain, the Internal Revenue Service looks to the use and ownership test. You have to have owned and used (i.e., lived) in the house for two out of the five years before it is sold.
However, according to the IRS, "If your home was transferred to you by your spouse (or former spouse if the transfer was incident to divorce), you are considered to have owned it during any period of time when your spouse owned it."
Additionally, "you are considered to have used property as your main home during any period when you owned it, and your spouse or former spouse is allowed to live in it under a divorce or separation instrument and uses it as his or her main home." (See IRS Publication 523, "Selling Your Home," available from http://www.irs.gov/.)
So, although you should confirm your situation with your divorce attorney, my reading of the law is that you and your ex would be able to sell the house and both of you would be eligible for the up-to-$250,000 exclusion of any profit you will make.
Keep in mind, however, that this does not mean you can exclude all of the $250,000; it allows you only to exclude that much of your profit, subject to the cap of $250,000.
However, to be completely safe, I would insist that the house be sold no later than two years after you have left the house. Another IRS publication you should look at is 504, entitled "Divorced or Separated Individuals."
DEAR BENNY: We have a big problem with one of our absentee homeowners who lives out of state and is an attorney. We recently reworked our covenants as homeowners after the developer turned over the property to us. Basically, all we did was take out the word "developer" and inserted "the homeowners association."

We sent out ballots to all the homeowners, which had a seal on it (notarized impression) as well as a return envelope with a code on it to prove it was an original ballot. Well, the attorney is challenging the favorable vote based upon the fact that the ballot didn't require a signature. --Norm

DEAR NORM: Does your association have an attorney? Presumably, the lawyer assisted you (or should have) in preparing the amendment to your covenants.

Every community association has legal documents. In a condominium, they are usually called the declaration and the bylaws. In a homeowners association, they are called covenants, conditions and restrictions (or CC&Rs). In cooperative housing, co-op owners rely on the articles of incorporation and bylaws.

Each of these documents will contain language as to how they can be amended. While I can't give you specific legal advice, in my opinion, the other attorney's position makes no sense.

If you followed the legal procedures for amending your documents, what difference does it make if there are or aren't signatures on the ballot? Actually, the signatures help you in determining the validity of the owner who submitted the ballot.

DEAR BENNY: Regarding timeshare owners, let's say they owe $45,000 and association dues are $1,000 a year. You have advised they could donate it to several organizations. How do you donate an obligation (mortgage) to anyone? Owning it debt-free and "donating" it makes sense, but not donating it when you owe $45,000.

Incidentally, I own four timeshares, which I bought on the secondary market for as little as $100, and not more than $1,500 each. They are a great deal if you use or trade them. I agree that buying timeshares from developers is almost always a stupid action, but there are many good things about timeshares.

By trading timeshares through one of the timeshare programs, I have had many weeks in different places. I am not a time share salesman or the representative of any developer. The best source for cheap timeshares is from timeshare homeowners associations where owners have stopped paying their monthly fees and deed the units back to them. Another simple way is a classified ad in the local paper offering to donate a timeshare. --Tom

DEAR TOM: You are correct that it will be difficult to donate a timeshare that has an underlying mortgage. Actually, from my readers who currently own timeshares, I have been learning that it is difficult to get rid of one regardless of whether there is a mortgage.

You have been lucky with your purchase, and I know that there are many happy timeshare owners. However, I believe you are in the minority; most of my readers are very unhappy and are desperate to rid themselves of that financial burden.

My advice if you happen to have an interest in buying a timeshare: Don't fall for the representations of the smooth-talking salesman. Get a copy of all documents that you will have to sign and have them carefully reviewed by your attorney.
If the salesman says you can't take the documents with you (as happened to me once when I was doing some hands-on research in this area), just say "thank you" and walk away.
DEAR BENNY: In a recent column, you answered a question from a woman who needed to find affordable housing. I suggest that she contact her local Habitat for Humanity organization. They will work with her and her fiancÃ©e to build a home for her that is handicapped accessible.

Yes, she will have to put in some "sweat" equity, but it doesn't have to be "hammer and nails" type of work. Habitat will allow both of them to work on fundraising projects like bake sales or social events, etc. --Norm
DEAR NORM: Thank you for writing and for your suggestion. I cannot (and will not) endorse any particular organization, since there are many such programs out there that assist people with housing needs. You have mentioned Habitat for Humanity, and I will let my readers do their own research and make up their own mind as to whether that program fits their individual needs.

DEAR BENNY: If a new appraisal of real estate is done at the time of the death of one of the owners, my husband, will that give a stepped-up basis for computation of capital gains taxes rather than the original purchase price when the property is eventually sold? Our house has more than doubled in value since we first bought it. --Billie

DEAR BILLIE: Congress is currently struggling with major tax issues, one of which involves the "stepped-up" tax basis. Basis is generally the price you paid for the house. To determine your profit (called "gain"), you take your basis, and add any major improvements you made over the years. That is called the adjusted basis.
You take your sales price, deduct such things as real estate commissions, and get the adjusted sales price. Your gain is the difference between the adjusted sales price and the adjusted basis.
Up until the end of 2009, the tax law said that on the death of a property owner, the basis of the inherited property was its value as of the date of death. In other words, the basis was "stepped-up." However, for year 2010, this "step-up" is not applicable.
Instead, heirs assume (or carry over) the basis of the deceased owner, but can elect to increase that basis up to $1.3 million. In your case, since you would be a surviving spouse, the basis can be increased by an additional $3 million.
This really does not impact middle-class Americans, unless your house is extremely valuable. But depending on what Congress does this year, the old stepped-up basis should be back on the books in 2011.

Benny L. Kass is a practicing attorney in Washington, D.C., and Maryland. No legal relationship is created by this column. Questions for this column can be submitted to benny@inman.com.

Funny Dog

2010-10-29T12:15:00.000-05:00

I had an istockphoto.com credit left that was expiring today so I had to quickly download an image. I thought this was a cute dog.

A haunting visit by a spooky character

2010-10-29T11:16:00.001-05:00

Dear Barry: You never do columns that recognize holidays. Even at Christmas time and the Fourth of July, your articles are always about property defects, real estate disclosure, and home inspections. Now that Halloween is here, how about a spooky house story. Something in keeping with the season. Surely you've inspected a few creaky old houses. How about it? --Bram

Dear Bram: Home inspections tend to be business-as-usual events: checking the foundations, roofing, plumbing, electrical wiring, etc.
But there was one inspection that I recall with dread and discomfort; an inspection where property defects ceased to be of concern, where routine was overshadowed by fear, where disclosures were eclipsed by a frenzied struggle to flee the premises.

And it just so happened that this inspection occurred on the eve of Halloween.
The house was an old, neglected, two-story Victorian, with leaning fences, tangled vegetation, and dense vines engulfing the walls, windows and roof. The property, in escrow as a probate sale, had been the subject of headlines when the owner was found hanging from the rafters of the foyer.
The police investigation had not determined whether death was from suicide or foul play, and the body's subsequent disappearance from the local mortuary had unsettled the community.
The buyers and agent were unable to attend the inspection, but the agent had left a key under the mat. Bracing myself, I pressed open the massive door, entered slowly, and commenced what I had hoped would be a routine inspection.

But then, beneath the lofty ceiling of the dark interior, I beheld the silhouette of the noosed rope, still attached to a high, dusty beam. A foul odor of decay permeated the stagnant air, and I recalled reading that the man had spent many days at the end of that rope before the neighbors had found him.
The prospect of working alone in those dim, silent rooms unsettled me, and my foremost thought was to complete the job and get out of that ominous place.
A steep stairway descended to the unpaved basement, where I proceeded to inspect the old stone foundations, but the sounds of creaking timbers echoed throughout the building, disrupting my attention.

So I busied myself and tried to dismiss my uneasiness. But then there seemed to be a different sound, somewhere upstairs. At first, it blended with the incessant creaking of the structure, but the difference was unmistakable.
This was not the sound of timbers. It was the slow but steady cadence of footsteps. Someone was in the house. Hoping to hear the voice of the real estate agent, I called out, "Hello, is someone upstairs?"
No one answered, but the footsteps continued down the hallway and stopped at the dark entrance to the basement stairwell. I called again, "Hello, who's there?" Again, no answer. Then, a shadow appeared on the stairs and moved slowly, silently downward.
A dark, disfigured form gradually took shape, the head laid awkwardly against the left shoulder. Yet my attention was drawn from this to some shadowy, indistinct object that dangled from his left hand.
As he reached the basement floor, a putrid foulness filled the room, so that breathing became forced and repugnant. Gripped with horror and disbelief, I was unable to move.
But then, the eyes of that disjointed head found me, the lips formed a sardonic grin, dripping with thick gray saliva, and my mobility was wakened by a wave of terror.
Clawing my way up the basement wall, I squeezed into the narrow space between the ground and the floor framing, seeking desperately for any way of escape. But the advancing form appeared atop the foundation wall and steadily pursued me into the dark crawlspace.
Scrambling breathlessly past rows of old piers, I reached a dead-end corner where the foundation walls joined, and I realized with desperate finality that I could flee no further.
Somewhere in the nearby darkness I could hear that half-dead form crawling toward me. Clutching at my flashlight, I found the switch and was startled by the impending nearness of the face: the glare of cold eyes, the glint of gray teeth, the viscous fluid that dripped from grimacing lips -- and that mysterious object gripped in his left hand.
Terror pounded in my chest as I faced those final, hopeless, remaining seconds. The feet between us became inches. His right hand gripped my ankle with frightful force as he drew forward.
Then his left hand extended the old gunny sack that he held, and the acrid smell of cold breath filled my face, as he cried, "Trick or treat!"
Happy Halloween.

Solving mystery of fair market value

2010-10-29T11:16:00.000-05:00

Q: I am a single woman and first-time homebuyer. I am totally new to all this. I found a property I like and it appears the selling price is matched up to the tax base value. If I want to make an offer, where/how do I find out the true "market value"? I do not want to insult the owners, but at the same time I want a good deal.
How does one find out what the fair market value of a house is? Is it in the MLS data or at the county court house?

A: Fair market value is the holy grail of real estate mysteries. It is nebulous, slippery and always changing, and actually only able to be estimated except at a precise point in time when the stars align and a set of conditions exists, which arise only a few times in the life of a property.

First things first -- here's what fair market value is not. In most cases, it's not the same as the tax assessor's value or assessment. It is rarely found in the multiple listing service information (although most listing agents will argue that the list price is near or below the fair market value), nor in a file at the county courthouse.

That's because the definition of a home's fair market value is the price a qualified buyer would pay for the home in an open-market, arm's-length transaction between strangers. I'd argue that this is the case when the property has been well-marketed, listed with an MLS, a buyer's broker commission has been offered, and a buyer who is both willing and able to buy the home comes forward and makes an offer to buy it (though listing a property with broker representation and in an MLS isn't essential to meet the definition of "fair market value").

The price of the best such offer in such a situation? That's the fair market value of the home.

So, that means that the fair market value is not necessarily the listing price, although it may be. It also means there's no rule of thumb about how much above or below the listing price the fair market value may be. Sometimes the assessor's value comes close to the fair market value, especially when the home has been sold or assessed fairly recently. However, there is a way to estimate a home's fair market value, and that is to analyze the recent comparable sales data.

If this sounds like what you think a home appraiser does, that's because it is. If you're not buying a home or otherwise engaged in a decision that warrants paying $500 for a formal appraisal, you can also do this yourself or in partnership with your real estate broker or agent.

What you need is the sales prices of three to five recently sold homes in close proximity to the home you're trying to value. The closer in time and geography, the better. Also, the more similar the homes are, the better.

Once upon a time the standard practice was to look at homes within a one-mile radius that had sold within the last six months; on today's volatile market, you'd do best to look at what homes have sold for in the last couple of weeks or months.

Keep in mind that you're looking at the prices these homes sold at -- not the list prices. The listing prices of homes that have not been sold can be informative -- especially if they are very similar and have lagged on the market a long time, which can educate you about what value is too high for the home -- but to pin down an actual value estimate, you'll want to look at the prices of closed sales, which are public in most places. Where do you get this information?

Many real estate listing websites offer this sales data (although the estimated values some offer vary widely in accuracy), and virtually every real estate agent would be happy to help a prospective buyer or seller conduct a comparative market analysis to help determine a home's fair market value, especially in the context of deciding what price to set or offer for a home.

Once you have the sales data, you'll want to mimic an appraiser by deciding how comparable the comparable homes actually are, and adjusting your estimated value of the home at issue upward if it is bigger and/or better than the comparable homes, and vice versa.

This can get somewhat tricky to do, and the process can be corrupted if you have subjective motives or biases, like you really want the place to be cheaper, or it's your home and you subconsciously (or consciously) want to list it much higher.

For this reason, and because you may not be able to make objective, accurate decisions about how much to adjust your estimate of the home's value upwards or downwards based on its differences from the comparable homes, I'd encourage you to work with a local real estate agent familiar with the neighborhood to pin down an estimated value.

If you have trouble finding one, or you are at a stage where you don't want to connect with an agent just yet, there are many online discussion forums and communities where local agents will chime in and help you get a reality check as to the value of a home.
Tara-Nicholle Nelson is author of "The Savvy Woman's Homebuying Handbook" and "Trillion Dollar Women: Use Your Power to Make Buying and Remodeling Decisions." Tara is also the Consumer Ambassador and Educator for real estate listings search site Trulia.com. Ask her a real estate question online or visit her website, www.rethinkrealestate.com.

Real estate contingencies make comeback

2010-08-17T19:46:00.000-05:00

Steps sellers can take to maximize chance of sale

Dian Hymer
Inman News
During the recession of the early 1980s, when mortgage interest rates hovered near 18 percent, few homebuyers could qualify for financing, particularly if they already owned a home that needed to be sold before buying a replacement home. Offers made contingent on the sale of the buyers' current home were popular.

Contingent-sale offers are increasing in the current housing recession. Most buyers who want or need to make a move to a home that better suits their current lifestyle can't qualify to buy before selling their existing home due to stringent mortgage qualifying criteria.
Sellers don't like offers that are contingent on another property selling because it increases uncertainty. If the buyers don't price their house right for the market and it doesn't sell, the sellers are back to square one searching for another buyer.
Most buyers aren't keen on selling their current home before they know where they will be living next. This can limit buyers' prospects because many sellers won't accept contingent-sale offers.
The best houses at the best prices usually sell quickly, sometimes with multiple offers. Sellers usually reject contingent-sale offers if there's another qualified buyer who doesn't have to sell a home.

As always with homebuying and selling, compromises must be made. In areas where home sales are slow and there are many homes on the market, a contingent-sale offer may be better than no offer.
A drawback is that once the sellers accept a contingent-sale offer, this fact must be disclosed to other interested buyers. This can slow the showing activity. Aggressive marketing, like continuing to hold Sunday open houses, can counteract this to some extent.
Sellers who accept contingent-sale offers can continue to entertain offers from other buyers for backup position, subject to the collapse of the primary offer. But when there is plenty of inventory for buyers to choose from, there's not much incentive for a buyer to make an offer on a listing that already has an accepted offer -- even though it is contingent on the sale of another property.
HOUSE HUNTING TIP: Sellers who accept contingent-sale offers can maximize their chance of selling by including a release or escape clause in the contract. This clause allows the sellers to notify the contingent-sale buyers that they have accepted another offer in backup position and that they are invoking the release clause.

The release clause has a time frame -- often 72 hours, but it's negotiable -- within which the primary buyers must remove the contingent-sale contingency and provide evidence that they can close the sale of the replacement home without having their home sold. If they are unable or unwilling to do so, the first contract is canceled and the backup buyers move into primary position.

Recently, buyers who were in contract to buy a home contingent on the sale of their home were delivered a 72-hour notification. The buyers who were kicked out of contract had their home on the market but hadn't found a buyer in time.

It's tempting for buyers who lose a home they want to another more qualified buyer to pull their home off the market and wait for a better time to sell. However, it's near impossible to buy contingent on the sale of another home in a seller's market when buyer demand is high.

THE CLOSING: It's inconvenient for most buyers to move to an interim rental if they sell their home before they find a suitable replacement home. But, with cash in hand, they have the luxury of waiting for the right house. They can make a stronger offer and probably receive a price concession compared to the premium usually paid to entice sellers into accepting a contingent-sale offer.
Dian Hymer, a real estate broker with more than 30 years' experience, is a nationally syndicated real estate columnist and author of "House Hunting: The Take-Along Workbook for Home Buyers" and "Starting Out, The Complete Home Buyer's Guide."

Free parking for caregiver?

2010-08-17T19:33:00.000-05:00

Rent it Right

Janet Portman
Inman News
Q: My elderly mother needs a caregiver twice a day to help her with dressing, bathing and food preparation, because her ability to walk is severely curtailed. Mother lives in an apartment complex that allocates one parking spot to each resident (mother has kept her car and parks it there so that her visiting children can use it to take her to doctor appointments).

The caregiver has to park on the street, sometimes more than a block away, which means that she bills my mother for the extra time it takes her to get to and from mother's unit.
Mother asked for an extra space, which is available, but management requires her to pay for it. As a person with a disability, isn't she entitled to a free parking space for the person whom she relies on for help with daily living activities? --Kelly P.

A: From your description of your mother's condition -- requiring help due to significant mobility problems -- it's clear that she qualifies legally as a person with a disability. That is, she is significantly impaired in one or more major life activities: namely, walking.

As a person with a disability, she could clearly ask management to make available a close-in parking spot for her personal use, because she could face injury or pain if she had to travel long distances from the house to the car. In other words, without a parking space close to the apartment, her use and enjoyment of the dwelling would be diminished.

Once a tenant can establish this direct link -- that the accommodation is necessary to address the problem -- then the question becomes whether it is reasonable to require management to provide the accommodation.
So, for example, if your mother were asking to bypass a wait list and be assigned a close-in spot immediately, a judge would consider the burden on the landlord of complying with this request. Most of the time, a situation like this is decided in the tenant's favor, because varying the normal parking policy in this way is not a big deal.
With this simple scenario as a backdrop, let's look at your mother's specific request. She's not asking for parking for herself; she's asking on behalf of a third party.

To prevail, your mother would have to argue that having to pay for the second parking spot for her helper would make it impossible for her to live comfortably in her rental; or, that the extra commute time she pays for as her helper walks to and from her car also makes it impossible for her to live there safely.

You can see that the neat, one-jump causal chain in our first scenario is missing here. Paying for the spot, or paying extra for the helper's walking time, doesn't necessarily prevent your mother from getting the care she needs. And for this reason, she might have a hard time convincing a judge that a free spot, or even an available spot, must be given to her caregiver.

One can imagine other situations in which the outcome might be different. Suppose, for example, that a husband and wife who both have disabilities and share a one-bedroom apartment ask for permission to have a live-in helper, in a state with an occupancy standard of two people per bedroom (that's the national guideline; some states are more generous).

Without a live-in, the couple will face many hours alone and will be unable to meet their basic needs.

Would it be reasonable to expect the landlord to adjust its policies, assuming building code space requirements would not be violated by the addition of one more occupant? Arguably yes, because of the direct link between the couple's ability to live safely in the rental and the accommodation sought.

And would it be reasonable to ask that no more rent be charged for this additional occupant? Now we're into the tricky waters posed by your question. Many judges will uphold the landlord's desire to charge for one more occupant, reasoning that this additional rent will not, by itself, defeat the couple's ability to live safely and comfortably in the rental.
Q: The street in front of my apartment building has become a popular spot for day laborers to hang out and wait for jobs. The place is quite messy and my tenants are upset. They don't like having to walk through the crowd, say they feel intimidated, and have asked me to do something about it or they'll move out. I'm also worried that if they are harmed, I'll be responsible. Any suggestions? --Arnold J.

A: The legal issues raised by the situation you describe are similar to the issues landlords face when the sidewalks in front of their buildings are taken over by drug gangs, prostitutes or other less savory types. Not that day laborers are in any way as fearsome and dangerous as some of these folks, by a long shot.

But the legal issue for the landlord is the same: To what extent are you responsible for dealing with a dangerous or even potentially dangerous situation taking place on public property directly adjacent to your building?

Put another way, if you do nothing and the situation continues, do tenants have a legal justification to break their leases without future liability for rent?

We know that if a landlord tolerates illegal behavior on his property, and fails to evict the criminals, the answer is simple: Tenants who are injured as a result can look to the landlord for damages, and those who are fed up get to move without responsibility for future rent.

But in your situation, the activity (putting aside for the moment whether it's criminal) is taking place on public space. You can hardly evict the laborers from the sidewalk, but you can take steps to mitigate the effect they are having on your tenants.

First, consider talking with your city attorney about the situation. Your city may have an "anti-loitering" law on the books that could address the situation, depending on how it's worded. It may even have a law that targets day laborers, prohibiting them from standing on streets and highways and soliciting work, or requiring them to wait only in specified areas.

Not that having such a law is a sure winner for you, however -- in the western U.S. alone, judges in several cases have struck down such laws as an infringement on free speech.

You might also consider a political approach to the problem of how unaffiliated people can look for work. Some cities have put aside land and even facilities for use as a sort of "day laborer hiring park or hall." These solutions are controversial, but they at least address the problem in a nonpunitive way. Your city government might be receptive to such a suggestion.

It would be wise to meet with your tenants, perhaps with a local policeman in attendance, to talk about the situation. Doing so will make it clear that you've heard their concerns, and the officer may have suggestions on how your tenants can safely interact (or not) with the laborers and minimize any chance of confrontation or problems.

If you have your meeting but get nowhere with an anti-loitering law, and there's no designated alternative area for laborers to congregate, you will be able to at least say that you did all that you could reasonably do to remedy the problem.

This is important: The law requires you to make a reasonable response to the situation, not a supernatural one. This means that if, for example, a tenant were accosted by one of the laborers, he'd have a hard time holding you partly responsible.

But whether a lease-breaking tenant could leave without responsibility for future rent is another matter. If a situation becomes intolerable, no matter how hard the landlord tries to fix it, tenants can leave. A graphic example is the current scourge of bedbug infestations.

Landlords are going to Herculean lengths to rid their buildings of the problem, but if they fail, their tenants can justifiably break their leases.

Again, the comparison is awkward, but the legal theory applies: Despite your efforts, if the gauntlet of workers remains as daunting as you describe, your tenants may be able to leave without responsibility for future rent.

Janet Portman is an attorney and managing editor at Nolo. She specializes in landlord/tenant law and is co-author of "Every Landlord's Legal Guide" and "Every Tenant's Legal Guide." She can be reached at janet@inman.com.

Solar lighting, decorative panels and options

2010-08-17T19:12:00.000-05:00

Paul Bianchina

Inman News

Everyone loves having an outdoor deck to relax on during the summer months. But if your deck is just a little bit on the boring side, there's a wide variety of deck helpers available for turning "ho-hum" into "wow"!

Deck balusters: Instead of standard wooden pickets on your deck railing, how about something really eye-catching? There are a variety of extruded aluminum balusters to select from that combine beautifully with wood to create a sturdy deck railing that's also weather-resistant. Aluminum balusters are available in lots of different baked-on enamel colors, such as black, white, green, bronze, silver and others.

Balusters don't need to be straight up and down either. You can choose from ones that are twisted in classic Colonial shapes, or ones that are arced out in smooth curves or angular bends to suit your particular tastes and style. All of them are pre-shaped, and simple to install.
Deck rail panels: How about something even more dramatic to set off your deck rail. There are laser-cut steel panels available with the silhouettes of trees, wildlife and other outdoor scenes. The panels fit into grooves in wooden supports to make up a sturdy deck railing that will really become a unique feature in your yard. You can ring the entire deck with them, or use just one or two panels as a focal point.
Solar post lights: Here's a quick and easy deck upgrade that looks great and is also a nice safety feature. Solar post lights attach to the top of any standard 4-by-4 posts. A small solar panel on top of the light uses sunlight during the day to recharge batteries inside the fixture, which powers LED lights at night. Solar post lights are available in several different styles and colors, and are easy to install with no electrical wiring required.
Rail-top planters: You can dress up the look of your deck without utilizing any valuable deck space by incorporating some rail-top planters. These attractive planters are made from vinyl, cedar, or other materials, and are designed with a groove in the bottom that fits over standard 2-by-4 or 2-by-6 lumber. Available in both round pot and rectangular box designs, the planters fit over the top cap of the deck's railing. They're easy to install wherever you want to add the beauty and color of fresh flowers on your deck, or even to create a quick herb garden.
Patio misters: If you have a deck that's a little too hot to handle some afternoons, consider the addition of some patio misters. A patio mister is simply a series of micro-nozzles, pre-installed in a length of hose. The hose is attached to the edge of your deck railing, the underside of a patio cover or pergola, or any other convenient location, then attached to an outdoor hose bib.
The nozzles deliver a continuous, very fine mist of water, which in turn will cool down the ambient temperatures and make your deck and your outdoor environment much more enjoyable.
Patio misters are available in different lengths and nozzle configurations, and there are also accessories such as booster pumps, splitters and even in-line filters to help you customize your installation.

Rope lights: For some fun and some added safety, consider adding some rope lights to your deck. Rope lights are tiny bulbs encased in clear or colored flexible plastic tubing, and they can be installed outdoors in a wide variety of locations.
They add a festive atmosphere to any deck or patio cover, and provide additional subtle, non-glare lighting for steps, railings and other areas. Look for lighting that's UL-approved (by Underwriters Laboratories Inc.) for exterior use.
Plan sets: Feeling ambitious? If you'd like to tackle an outdoor project that will improve your yard and give you a tremendous feeling of accomplishment, but you're at a loss as to where to begin, consider buying a set of pre-drawn plans. There are plan sets available for a wide variety of projects, from simple barbecue carts and picnic tables to Adirondack chairs and deck gliders.
You'll find plans for interesting deck railings, pergolas and deck covers, and even for the deck itself. The typical plan set comes with drawings, material lists and assembly instructions, and some are even available with DVDs.
You can find these and other accessories for your deck at your local home center, hardware store and lumberyard, as well as at some larger department stores and warehouse stores. And as always, a search of the Internet will yield a wealth of products and ideas.
Remodeling and repair questions? E-mail Paul at paulbianchina@inman.com. All product reviews are based on the author's actual testing of free review samples provided by the manufacturers.

FHA Launches Short Refi Opportunity for Underwater Homeowners

2010-08-10T22:18:00.000-05:00

RISMEDIA, August 9, 2010--In an effort to help responsible homeowners who owe more on their mortgage than the value of their property, the U.S. Department of Housing and Urban Development provided details on the adjustment to its refinance program which was announced earlier this year that will enable lenders to provide additional refinancing options to homeowners who owe more than their home is worth. Starting September 7, 2010, the Federal Housing Administration (FHA) will offer certain ‘underwater’ non-FHA borrowers who are current on their existing mortgage and whose lenders agree to write off at least ten percent of the unpaid principal balance of the first mortgage, the opportunity to qualify for a new FHA-insured mortgage.
The FHA Short Refinance option is targeted to help people who owe more on their mortgage than their home is worth – or ‘underwater’ – because their local markets saw large declines in home values. Originally announced in March, these changes and other programs that have been put in place will help the Administration meet its goal of stabilizing housing markets by offering a second chance to up to 3 to 4 million struggling homeowners through the end of 2012.
“We’re throwing a life line out to those families who are current on their mortgage and are experiencing financial hardships because property values in their community have declined,” said FHA Commissioner David H. Stevens. “This is another tool to help overcome the negative equity problem facing many responsible homeowners who are looking to refinance into a safer, more secure mortgage product.”
FHA published a mortgagee letter to provide guidance to lenders on how to implement this new enhancement. Participation in FHA’s refinance program is voluntary and requires the consent of all lien holders. To be eligible for a new loan, the homeowner must owe more on their mortgage than their home is worth and be current on their existing mortgage. The homeowner must qualify for the new loan under standard FHA underwriting requirements and have a credit score equal to or greater than 500. The property must be the homeowner’s primary residence. And the borrower’s existing first lien holder must agree to write off at least 10% of their unpaid principal balance, bringing that borrower’s combined loan-to-value ratio to no greater than 115%.
In addition, the existing loan to be refinanced must not be an FHA-insured loan, and the refinanced FHA-insured first mortgage must have a loan-to-value ratio of no more than 97.75 percent. Interested homeowners should contact their lenders to determine if they are eligible and whether the lender agrees the write down a portion of the unpaid principal.
To facilitate the refinancing of new FHA-insured loans under this program, the U.S. Department of Treasury will provide incentives to existing second lien holders who agree to full or partial extinguishment of the liens. To be eligible, servicers must execute a Servicer Participation Agreement (SPA) with Fannie Mae, in its capacity as financial agent for the United States, on or before October 3, 2010.

Piercy Group Current Listings

2010-08-01T15:52:00.000-05:00

Take a look at our current listings. If none of these listings match what you are looking for be sure to email us. We will find exactly what fits your needs.

10334 Lee Boulevard
Leawood, KS 66206

Status:	Active
Price:	US$329,950 to US$329,950
MLS Number:	1682701
Type:	Residential
Bedrooms:	3
Bathrooms:	2
Lot Size:
Living Area:

Meticulously restored Leawood Home on almost a half acre! This home boasts gleaming refinished hardwood floors, granite countertops, brand new inter...

Details

2711 W. 73rd Street
Prairie Village, KS 66208

Status:	Active
Price:	US$249,950
MLS Number:	1683139
Type:	Residential
Bedrooms:	3
Bathrooms:	1.5
Lot Size:
Living Area:	1537

Coveted Prairie Hills ranch with huge family room. New roof in 06, new HVAC in 05, new dishwasher in 06. Expandable attic with space for 12x46 maste...

Details

220 E. Winthrope Road
Kansas City, MO 64113

Status:	Active
Price:	US$169,900
MLS Number:	1648895
Type:	Residential
Bedrooms:	2
Bathrooms:	1
Lot Size:	.10
Living Area:	1284

Beautiful home atop steep drive. Only 3 owners in 85 years. New 30 year Timberline roof installed in 2009. Other updates included: renovated kitchen, ...

Details

7729 Jefferson
Kansas City, MO 64114

Status:	In Escrow
Price:	US$135,000
MLS Number:	1624544
Type:	Residential
Bedrooms:	3
Bathrooms:	2
Lot Size:	50 x 120
Living Area:	1521

Spacious 3 bed, 2 bath with hardwood floors throughout. Updated kitchen and baths. Large master suite with walkin closet, built-in and glass block and...

Details

7833 Pennsylvania
Kansas City, MO 64114

Status:	Active
Price:	US$129,900
MLS Number:	1658826
Type:	Residential
Bedrooms:	3
Bathrooms:	1
Lot Size:
Living Area:	1273

Charming Cape Cod in convenient Waldo location. Updated fixtures, stylish colors and no shortage of space in this 3 bedroom, 1 bath home. Master bed...

Details

5420 N. Fairmount Avenue
Kansas City, MO 64118

Status:	Active
Price:	US$80,000
MLS Number:	1667724
Type:	Residential
Bedrooms:	2
Bathrooms:	2.5
Lot Size:
Living Area:

Light open floor plan in this 2 bedroom, 2.5 bath townhome. Large kitchen & pantry look out to dining & living areas. Carpets professionally...

Details

1020 E. 76th Street
Kansas City, MO 64131

Status:	In Escrow
Price:	US$64,500
MLS Number:	1624375
Type:	Residential
Bedrooms:	2
Bathrooms:	1
Lot Size:
Living Area:	860

2 bed, 1 bath Ranch. Newly painted, new windows, totally renovated bath from the floor tile to the ceiling. Spacious kitchen with new flooring, counte...

Details

8215 Grand
Kansas City, MO 64114

Status:	Active
MLS Number:	1657781
Type:	Residential
Bedrooms:	3
Bathrooms:	1
Lot Size:
Living Area:	921

Charming Home w/Amazing Character. Located Among Beautiful Trees in Quiet Established Neighborhood. Great Deck, Attic Ready to be Finished, Just Nee...

Details

FHA has its day

2010-07-31T21:21:00.002-05:00

5 tips to secure a federally insured mortgage

Mary Umberger
Inman News

In the heady days of the housing boom, so-called FHA loans ended up being the lonely guy sitting on the sidelines.

After all, at that time the mortgage market had a free-flowing and apparently limitless pipeline of funds for borrowers who had little to no money for a downpayment. Demand for the Federal Housing Administration's programs to help first-time and low-income buyers dwindled.

That was then, as they say. This is now, when lending policies have gotten considerably more stringent in the wake of the housing downturn.

Suddenly, the government program that's been around since 1934 is looking a lot more attractive to a lot more people: The agency went from being involved with just 464,000 loans in 2007 to 2 million loans in fiscal 2009, according to a recent speech by its commissioner, David Stevens.

Its share of the market, depending on the region, is 30 to 50 percent.

So, for many homebuyers, FHA is the name of the game these days. Five things to know about FHA mortgages:

1. The FHA doesn't make loans, it insures them. Participants in FHA-insured mortgages get their loans through conventional lenders whose standards meet the FHA's.

The agency's guarantees mean that lenders can be confident that they won't lose money on the loans and can make more of them -- thus, in theory, helping to keep the housing market flowing.

2. FHA loans are attractive to many borrowers because they require as little as 3.5 percent down, compared to the so-called conventional market, which these days typically requires 10 percent down or more for competitively priced rates.

They're relatively easy to qualify for: The FHA places no income restrictions. Borrowers can have middling credit histories. In addition, FHA policies allow borrowers to include gifts from family members in their downpayments.

Currently, the FHA doesn't set a qualifying credit score for borrowers, according to FHA spokesman Lemar Wooley.

"We don't really have a hard minimum score requirement," he said. "We ask our lenders to look at the entire credit picture, with the major requirement being the ability to repay the loan."

However, Wooley said, a 580 score (on an 850-point scale) is set to become the minimal requirement, though an implementation date has not been set. Currently, applicants with scores below 500 do need to increase their downpayments to 10 percent, he said.

The FHA allows borrowers to allocate as much as 43 percent of their income to housing and long-term debt costs, which in the mortgage business is called a back-end ratio; conventional loans vary slightly in that cap, although they generally limit their borrowers to a back-end allocation that's several percent less.

3. FHA's insurance isn't free: Homebuyers with FHA-insured loans will pay an upfront premium at the time of closing (2.25 percent of the purchase price) and then for an extended period will make monthly payments to cover the annual cost of the insurance, 0.5 percent of the amount of the loan, Wooley said.

4. As popular as they are these days, FHA-insured loans aren't for all borrowers.

"I'm not a big fan of government loans," said Dale Robyn Siegel, a White Plains, N.Y., mortgage broker and author of "The New Rules for Mortgages" (Penguin/Alpha).

Siegel says that if conventional loan paperwork is significant, the FHA's is even more daunting. In addition, the FHA is strict about the physical state of the home that's being purchased.

"If the property isn't in good condition, FHA might reject it," Siegel said. "If the FHA borrower is lower-income, and then has lower savings after they close (on the house), you have less money to fix it. So the house needs to be in better condition, out of the gate."

Another potential roadblock: FHA limits the sizes of loans it will insure, from about $271,000 in low-cost areas to nearly $730,000 in high-cost areas.

5. Many borrowers these days think FHA is the only game in town, but it isn't, Siegel said.

"I would always say, 'Get a second opinion,'" she said.

She said some borrowers with bruised credit presume they'd be ineligible for loans in the conventional market, though that's not necessarily so. Borrowers with downpayments of less than 20 percent from those lenders still would have to get mortgage insurance from a private source, she said.
Siegel said the threshold for getting an FHA loan sounds more generous than it would turn out to be in the marketplace. "The FICO score (that FHA will permit) is 580, but good luck, try and get it approved," she said.

More information on FHA-insured mortgages, including its state-by-state listings of mortgage limits, is available at fha.gov.

In the heady days of the housing boom, so-called FHA loans ended up being the lonely guy sitting on the sidelines.

After all, at that time the mortgage market had a free-flowing and apparently limitless pipeline of funds for borrowers who had little to no money for a downpayment. Demand for the Federal Housing Administration's programs to help first-time and low-income buyers dwindled.

That was then, as they say. This is now, when lending policies have gotten considerably more stringent in the wake of the housing downturn.

Suddenly, the government program that's been around since 1934 is looking a lot more attractive to a lot more people: The agency went from being involved with just 464,000 loans in 2007 to 2 million loans in fiscal 2009, according to a recent speech by its commissioner, David Stevens.

Its share of the market, depending on the region, is 30 to 50 percent.

So, for many homebuyers, FHA is the name of the game these days. Five things to know about FHA mortgages:

1. The FHA doesn't make loans, it insures them. Participants in FHA-insured mortgages get their loans through conventional lenders whose standards meet the FHA's.

The agency's guarantees mean that lenders can be confident that they won't lose money on the loans and can make more of them -- thus, in theory, helping to keep the housing market flowing.

2. FHA loans are attractive to many borrowers because they require as little as 3.5 percent down, compared to the so-called conventional market, which these days typically requires 10 percent down or more for competitively priced rates.

They're relatively easy to qualify for: The FHA places no income restrictions. Borrowers can have middling credit histories. In addition, FHA policies allow borrowers to include gifts from family members in their downpayments.

Currently, the FHA doesn't set a qualifying credit score for borrowers, according to FHA spokesman Lemar Wooley.

"We don't really have a hard minimum score requirement," he said. "We ask our lenders to look at the entire credit picture, with the major requirement being the ability to repay the loan."

However, Wooley said, a 580 score (on an 850-point scale) is set to become the minimal requirement, though an implementation date has not been set. Currently, applicants with scores below 500 do need to increase their downpayments to 10 percent, he said.

The FHA allows borrowers to allocate as much as 43 percent of their income to housing and long-term debt costs, which in the mortgage business is called a back-end ratio; conventional loans vary slightly in that cap, although they generally limit their borrowers to a back-end allocation that's several percent less.

3. FHA's insurance isn't free: Homebuyers with FHA-insured loans will pay an upfront premium at the time of closing (2.25 percent of the purchase price) and then for an extended period will make monthly payments to cover the annual cost of the insurance, 0.5 percent of the amount of the loan, Wooley said.

4. As popular as they are these days, FHA-insured loans aren't for all borrowers.

"I'm not a big fan of government loans," said Dale Robyn Siegel, a White Plains, N.Y., mortgage broker and author of "The New Rules for Mortgages" (Penguin/Alpha).

Siegel says that if conventional loan paperwork is significant, the FHA's is even more daunting. In addition, the FHA is strict about the physical state of the home that's being purchased.

"If the property isn't in good condition, FHA might reject it," Siegel said. "If the FHA borrower is lower-income, and then has lower savings after they close (on the house), you have less money to fix it. So the house needs to be in better condition, out of the gate."

Another potential roadblock: FHA limits the sizes of loans it will insure, from about $271,000 in low-cost areas to nearly $730,000 in high-cost areas.

5. Many borrowers these days think FHA is the only game in town, but it isn't, Siegel said.

"I would always say, 'Get a second opinion,'" she said.

She said some borrowers with bruised credit presume they'd be ineligible for loans in the conventional market, though that's not necessarily so. Borrowers with downpayments of less than 20 percent from those lenders still would have to get mortgage insurance from a private source, she said.

Siegel said the threshold for getting an FHA loan sounds more generous than it would turn out to be in the marketplace. "The FICO score (that FHA will permit) is 580, but good luck, try and get it approved," she said.

More information on FHA-insured mortgages, including its state-by-state listings of mortgage limits, is available at fha.gov.

No need for another tax credit

2010-07-31T21:12:00.000-05:00

Some markets will hardly notice absence of stimulus

Steve Bergsman
Inman News

The federal homebuyer tax credit is fading away, and it won't be missed by all.

It looked good on paper: an $8,000 tax credit for first-time buyers and $6,500 for existing homeowners buying a new house.

And, the general consensus is the tax credit helped a lot of first-time buyers enter into homeownership, which a majority of folks still think is a good idea -- despite the destruction of the financial markets and encompassing recession that has forced millions into foreclosure.

So the stimulus did its job, but it couldn't last forever. And if the housing market at this point in the cycle can't push into the positive on its own momentum, there are serious structural problems in the homeownership business and another stimulus would only forestall a reckoning.

In addition, the tax credit literally skipped past a number of individual metros, leaving barely a footprint, so in those particular markets the exit of the tax credit will really not be noticed.
It's going to just take a few months to figure out where we stand, but most believe the housing market has been stabilized and will get stronger before the end of the year.

Before the tax credit headed into the sunset (contracts needed to be signed by April 30 and loans need to close by Sept. 30 -- the closing deadline was extended past the original June 30 expiration), there was a surge of buyers trying to wrap up sales before the contract deadline.

That's going to lead to a drop in sales over the summer months, and normal purchase levels should be reached again in September.

"We got a tremendous jump, both times, when it looked like the tax credits were ending, then there was a fall-off in pending sales," said Jed Smith, managing director of quantitative research at the National Association of Realtors.

According to the Wall Street Journal, the sales decline attributed to the contract deadline for the tax credits was more severe than expected, with some markets showing a drop-off of 25 percent to 30 percent.

In the past, that fall-off was short-lived -- two to three months at the most -- and Smith suspects there will be a pick-up in home sales in August. (According to his data, the fall-off began in May.)

Smith projects home transactions for 2010 will come in around 5.3 million sales, which is where the market has been trending for the last 12 months.

Those are national projections, which, when viewed in isolation, mask a number of anomalies in the tax credit program's implementation.

A few months back, when I interviewed Glenn Plantone -- a Las Vegas real estate investment adviser who founded the Real Estate Insider Club of Las Vegas -- about investor interest in Las Vegas' single-family home market, he alluded to the fact that the tax credit made little impact in his town for the simple reason that so much of the homebuying has been by third-parties (investors) paying cash.

Investors had little use for the tax credit because deals are driven by returns and cap rates.

"Last year, 50 percent of the home purchases were with cash and this year it's 34 percent," said Plantone. "The next largest percentage was by buyers putting down 20 percent or greater of the total cost. The number of buyers actually taking advantage of the tax credit might only be 5 percent to 15 percent."

He added, "last year I sold 14 homes to one buyer and 10 homes to another. I know other Realtors here that have sold 10-20 homes to just one person. That being said, I don't think the tax credit has had as big an effect in this local market as maybe some other markets."

Sales in Las Vegas were down in June (3,360 homes sold that month vs. 4,186 homes sold in May), but that could have been because of hot weather, said Plantone. "We need to see what happens over a few months."

One must also clarify the data points. House sales in Las Vegas may have declined on a month-to-month basis going into the spring, but if one compares May 2010 sales to May 2009 sales they are roughly flat.

Miami has experienced the same "cash" phenomenon as Las Vegas, with some local twists.

"Our typical buyers this year are individuals with a lot cash and foreign nationals who have no interest and no idea about the tax credit," said Patrick O'Connell, a senior vice president with EWM Realtors in Coral Gables, Fla.

The tax credit was not really a buying decision for his clients, O'Connell, said, adding that he could see where it was important elsewhere.

"My brother lives in Cincinnati and he recently bought a $92,000 house. That $8,000 tax credit meant a new healing and cooling system for the house," he said. "That was one of the reasons why (he) bought now."

The tax credit was a lesser factor in some high-end markets. When someone is paying $1 million-plus for a condominium in Manhattan or a home in Newport Beach, Calif., that $8,000 tax credit is negligible.

In June, when the National Association of Realtors reported a sales decline compared to May, home prices in the generally expensive Northeast popped 7.9 percent.
Markets in recovery, and especially those beaten down (like Las Vegas), didn't get the full effect of the tax credits either, said NAR's Smith. "The tax credits might have helped a little bit, but the volume would have picked up regardless of the tax credits."

There is little chance for another round of tax credits because the general feeling is that the country is past the point of getting things stabilized. And for expansion to occur, people need to go back to work. Employment levels, not government programs, will be the key growth factor for the housing market in the months ahead.

"The big issue in buying a house is jobs," Smith asserts. "If the job market is declining, regardless of what incentives you offer people, you are not going to get a lot of sales."

Steve Bergsman is a freelance writer in Arizona and author of several books. His latest book, "After the Fall: Opportunities and Strategies for Real Estate Investing in the Coming Decade," has been ranked as a top-selling real estate investment book for the Amazon Kindle e-reader.

Quick tips for patching chimney

2010-05-21T10:23:00.000-05:00

Leaky basement calls for thorough inspection

Bill and Kevin Burnett
Inman News

Q: After a hard rain, we found water in our basement near where our chimney attaches to the house. We noticed that the caulking between the chimney and the house is dry and cracking. We also noticed that the basement's ceiling has water spots, which leads us to believe it has happened before.
Is there a special caulk we can use after we remove the old material? And some of the mortar between the bricks is cracked. Our house is about 30 years old.

A: A 30-year-old chimney needs a good inspection. You can do the inspection on the outside yourself. But we recommend that you get a chimney sweep for the inside.

Over time, creosote, a byproduct of wood, builds up in the chimney liner. Creosote buildup is the main cause of chimney fires. If you use the fireplace regularly during the winter, an annual inspection and cleaning is a must.

As for the chimney's exterior, get on a ladder and take a look. Pay special attention to the joints, where the chimney meets the siding. Cracked caulking means water penetration for sure, but also pay attention to where the roof meets the chimney.

Is the flashing in good shape? If not, this could be a cause of leakage, too. Recaulking is in order, but first take a look at the mortar.

Given that you have cracked mortar joints, we suspect that the mortar is beginning to fail. Test the joints by trying to remove some mortar with a teardrop paint scraper. If mortar comes out in a granular mass, it's time to repoint the chimney, which means replacing the decayed mortar with new mortar.

First, scrape about an inch of mortar from the joints. You can either do all the scraping at once or you can scrape as you go. While you're at it, scrape out the old cracked caulk where the chimney and the siding meet.

To replace the mortar, you'll need a pointing tool and some mortar. A point tool is a handheld metal tool about a foot long with two half-round sides on the ends. Mix the mortar to the consistency of thick peanut butter. If you use packaged mortar mix, we suggest you enrich it with some additional Portland cement.

Brush the joint with a wet brush. The added moisture will seep into the existing mortar and allow the cement to seep in. This will provide a stronger bond between the old and new work. Pick up some mortar in one hand and coax it into the joint using the pointing tool. The first few times you'll lose a good bit of mortar. Don't worry, pick it up and use it on the next joint.

Let the mortar dry for 20 minutes or so. Then tool the joints with the pointing tool. The tooling produces a smooth finished joint. Let the mortar dry for a few days before caulking the joint between the siding and the chimney.

Caulking brick should be done with paintable clear caulk. Paintable clear caulk goes on white but dries clear after a few hours. Unless you're perfect, white caulk can make a mess on brick. If clear caulk is not available, choose an elastomeric caulk. Use blue painter's masking tape on both sides of the joint to get a crisp, clean line.

36 hours in Kansas City

2010-05-20T21:53:00.002-05:00

Steve Hebert for The New York Times. A Misty Gamble sculpture at the Sherry Leedy Gallery. The New York Times By Charly Wilder

KANSAS CITY is known for its barbecue, bebop and easy-does-it Midwestern charm. But a decade-long effort to revitalize the city's downtown has transformed this former jazz mecca, which straddles the Kansas-Missouri border, back into a culturally rich metropolis. The city's standing will be further bolstered next year when the much-anticipated Kauffman Center for the Performing Arts opens, giving a sleek new home to the symphony, opera and ballet. True, Kansas City is no backwater, but don't expect high polish. In fact, it's the city's unvarnished grit that may be its best asset.

Friday 4 p.m.

1) CROSSROADS REDEFINED
Industrial stagnation and suburban exodus in the 1960s left the Crossroads neighborhood nearly deserted. But thanks to the recent efforts of arts advocates and city tax breaks, the Crossroads Arts District (kccrossroads.org) is now home to some 70 galleries. Two pioneering mainstays are Sherry Leedy Contemporary Art (2004 Baltimore Avenue; 816-221-2626; sherryleedy.com), which specializes in midcareer artists like Jun Kaneko, and the Byron C. Cohen Gallery (2020 Baltimore Avenue, Suite 1N; 816-421-5665; byroncohengallery.com), representing several artists from China, including the photo-artist Huang Yan. If it's the first Friday of the month, many galleries hold open houses until about 9 p.m.

7 p.m.

2) SAUCE IT UP
Debates over the best barbecue rouse as much passion here as religion or politics. Some swear by the old guard like Gates Bar-B-Q (gatesbbq.com) and Arthur Bryant's (arthurbryantsbbq.com), both of which have multiple branches. Others cross the state line into the Kansas side, to a relative newcomer, Oklahoma Joe's (3002 West 47th Avenue; 913-782-6858; oklahomajoesbbq.com), which opened a second location in 2005. It serves up pulled pork and beef brisket piled high on white bread, in a sauce that may just be the perfect amalgam of sweet, smoke and vinegar. At a little under $19, a full slab serves two or three people.
11 p.m.

3) BEYOND BLUES AND JAZZ

If the city's indie music scene hasn't garnered the same hype as those in other Midwestern cities like Minneapolis or Omaha, it's not for lack of guts or artistry. Homegrown bands like Ssion, a gender-bending art-punk music collective that has built a following with over-the-top live shows, cut their teeth in downtown galleries and dives. Hear up-and-comers at the Record Bar (1020 Westport Road; 816-753-5207; therecordbar.com) and the Brick (1727 McGee Street; 816-421-1634; thebrickkcmo.com). One of the newest spots is the Czar Bar (1531 Grand Boulevard; 816-221-2244; czarbar.com); it's owned by John Hulston, who also runs Anodyne Records, which counts the Meat Puppets, the BellRays and Architects among its better-known acts.
Saturday
10 a.m.

4) PARK LIFE
Kansas City is said to have more fountains than any other city except Rome. One of the loveliest can be found at Jacob L. Loose Park (51st Street and Wornall Road), a Civil War site, where the Laura Conyers Smith Fountain, made of Italian stone, is encircled by thousands of roses in some 150 varieties. The park is popular with picnicking families and bongo-playing teenagers on furlough from the suburbs.
Noon

5) CONTEMPORARY GREENS
If last night's barbecue has you yearning for a salad, head to Café Sebastienne, an airy, glass-covered restaurant at the Kemper Museum of Contemporary Art (4420 Warwick Boulevard; 816-753-5784; kemperart.org/cafe). A dish of seasonal greens with cucumber, red onion, grape tomatoes, sheep's milk cheese and grilled pita is $11. After lunch, pop inside for a quick look at the Kemper's small but diverse collection of modern and contemporary works by artists like Dale Chihuly and Louise Bourgeois, whose gigantic iron spider sculpture looms over the front lawn.
1:30 p.m.

6) MUSEUM POW-WOW
In 2007, the Nelson-Atkins Museum of Art (4525 Oak Street; 816-751-1278; nelson-atkins.org) was thrust into the national spotlight when it opened a new wing designed by Steven Holl. The Bloch Building - which holds contemporary art, photography and special exhibitions - consists of five translucent glass blocks that create what Nicolai Ouroussoff, the architecture critic of The New York Times, described as "a work of haunting power." The museum, which is free to the public, also unveiled a suite of American Indian galleries in November. It's an assemblage of about 200 works from more than 68 tribes, considered one of the most important collections of its kind.
4 p.m.

7) 18TH STREET COUTURE

The Crossroads cultural awakening extends beyond art and into fashion. Three boutiques carrying the work of up-and-coming designers occupy a former film storage unit on West 18th Street. Peregrine Honig and Danielle Meister handpick lingerie and swimwear to carry at their shop, Birdies (116 West 18th Street; 816-842-2473; birdiespanties.com). Kelly Allen selects a quirky cross-section of locally designed clothing and accessories at Spool (122 West 18th Street; 816-842-0228). And Peggy Noland (124 West 18th Street; 816-221-7652; peggynoland.com) sells Day-Glo spandex bodysuits in a space covered floor-to-ceiling with stuffed animals.
7 p.m.

8) MIDWEST TAPAS
Stay in the Crossroads to sample modern Mediterranean-style tapas at Extra Virgin (1900 Main Street; 816-842-2205; extravirginkc.com), the latest restaurant from Kansas City's culinary titan, Michael Smith. The fare is more playful and adventurous than that of his formal restaurant next door. And if the loud, euro-chic décor, replete with a floor-to-ceiling "La Dolce Vita" mural, seems to be trying a little too hard, the crowd of unbuttoned professionals enjoying inspired dishes like crispy pork belly with green romesco and chick pea fries doesn't seem to mind. The menu is diverse, as is the wine list. Single plates range from $3 to $25.
10 p.m.

9) 'ROUND MIDNIGHT

Love it or hate it, the flashy new Kansas City Power and Light District (1100 Walnut Street; 816-842-1045; powerandlightdistrict.com) offers a wide range of bars, restaurants and clubs that can feel like an open-air fraternity party. A smarter alternative can be found in the West Bottoms, an industrial neighborhood that draws a more urbane crowd. The R Bar (1617 Genessee Street; 816-471-1777; rbarkc.com), which opened in September, features live jazz and bluegrass, as well as old-time cocktails like Moscow mules and mint juleps. When midnight strikes, head to the Mutual Musicians Foundation (1823 Highland Avenue; 816-471-5212; thefoundationjamson.org). The legendary haunt opened in 1917 and public jam sessions are held every Saturday until around 6 a.m. For $8, you can catch impromptu sets by some of the city's undiscovered musicians in the same room where Charlie Parker had a cymbal thrown at him in 1937.

Sunday

11 a.m.

10) VIVA BRUNCH

As any resident will tell you, Mexican food is a big deal here. One of the most authentic spots is Ortega's Restaurant (2646 Belleview Avenue; 816-531-5415; ortegas.synthasite.com), tucked in the back of a mom-and-pop grocery store in midtown. On Sundays, Ortega's draws a lively mix of churchgoing families and hung-over art students with its $6 huevos rancheros.

Noon

11) VINTAGE FINDS
Kansas City has great secondhand shopping. Bargains are easy to find, and flea markets have yet to be ransacked by collectors from the coasts. Grab a copy of The Kansas City Star (kansascity.com) or search Craigslist (kansascity.craigslist.org) for current listings of auctions and estate sales. Better yet, take a drive through the sprawl of surrounding suburbs on the lookout for garage sales. Even if you don't find that perfect antique, an afternoon spent chatting with the friendly residents of this changing city will remind you that some things don't need making over.
IF YOU GO

Continental, Delta and Midwest Airlines fly nonstop from New York City to Kansas City International Airport. According to a recent Web search, round-trip fares start at about $325 for travel this month. A car is recommended for getting around, though to paraphrase an old song, if you have to walk, you'll get there just the same.
The Raphael(325 Ward Parkway; 816-756-3800; raphaelkc.com), a 126-room hotel in a neo-Renaissance manor overlooking the Country Club Plaza, recently finished a major renovation, with black marble bathrooms, flat-screen televisions and two spacious conference rooms. And with standard rooms going for as little as $139, it's one of the city's best bargains.
The 120-room Q Hotel + Spa (560 Westport Road; 816-931-0001; theqhotel.com) opened in 2007 in the historic Westport district and bills itself as the city's first green hotel, offering eco-friendly hand soap, energy-efficient lamps and in-room recycling service (unused paper is given to a school next door). Standard rooms start at $107, if booked 23 days in advance; otherwise $137.
This story was taken from the New York Times.

Electronic Signatures?

2010-05-19T15:38:00.001-05:00

FHA has approved Docusign. What are your thoughts on using electronic signatures? I am starting to use them with some clients and thus far I have had good reviews. Let me know your thoughts.

DocuSign®, the leader in on-demand electronic signature solutions, today announced that e-signed third-party documents, including real estate contracts, are now being accepted by the Federal Housing Administration (FHA). DocuSign spearheaded an industry-wide effort to move the FHA to formally recognize e-signed third-party documents. The April 8, 2010 dated FHA mortgagee letter is the first in what is expected to be a series of responses to this initiative. With this policy statement from the nation's largest mortgage insurer, real estate professionals can use DocuSign to get real estate contracts, addenda and other documents signed electronically, and their buyers can apply for FHA insurance with confidence. The FHA mortgagee letter can be found at http://nhl.gov/offices/adm/hudclips/letters/mortgagee/files/10-14ml.pdf.

"We commend FHA's action today. By clarifying its position on electronic signatures, the process of buying, selling and financing of homes across the country will be greatly improved," said Ken Moyle, chief legal officer at DocuSign. "Buyers, sellers and agents can use DocuSign's online process to eliminate the time, expense and environmental impact of printing, delivering and signing large stacks of paper documents, and mortgage lenders can take comfort in knowing that DocuSign's e-signature process is designed for legal compliance in all 50 states and is fully evidenced by a comprehensive audit trail."

Real estate agents can quickly access the DocuSign e-signing service from any laptop with Internet access, drag and drop familiar yellow StickEtabs® onto the contract and send the envelope. The recipient immediately receives an email notification that can be accessed through a computer or any Web-enabled mobile device, including Apple® iPhone®, RIM® BlackBerry®, Google® AndroidTM, Windows Mobile®, adopts an e-signature and signs the document. Once completed, an email notification is sent to all parties with a link to the final executed document. The result is a legally binding, fully ESIGN-compliant document supported by a comprehensive audit trail.

As on-demand software-as-a-service (SaaS), DocuSign requires no additional software or hardware purchases and no downtime for training. DocuSign eSignature service offers users one of the easiest, most simple to use and safest electronic signature experiences available today. For more information on DocuSign, visit www.docusign.com

For Sale: 3BR/1BA Single Family House in Kansas City, MO, $120,000

2010-03-01T11:20:00.000-06:00

For Sale: 3BR/1BA Single Family House in Kansas City, MO, $120,000

Real Estate Terminology for First Timers

2010-02-24T12:32:00.002-06:00

First time buyers face a learning curve that can feel overwhelming if the right level of support and education is not available. It's not enough to merely educate one's self on buying strategies, mortgage application, and closing process. Buyers must also navigate through a sea of unfamiliar legalese, home building lingo and real estate specific jargon.
The glossary below is by no means complete and is no substitute for the careful guidance of an experienced real estate agent, but it can serve as a good primer for consumers getting their feet wet in real estate for the first time.
Agency - The relationship of trust that exists between buyers or sellers and their agents. The agency is formed via a written contract.
Amortization - The process of paying the principal and the interest on a mortgage through regularly scheduled payments.
Appraised Value - A licensed appraiser's opinion of the current market value of a property.
Assessed Value - A tax assessor's determination of the value of a home in order to calculate a tax base.
Breezeway - A roofed passage way with open sides.
Capital improvement - Any improvement that extends the life or increases the value of a piece of property.
Comparable sales - Recent sales of similar properties in nearby areas and used to help determine the market value of a property. Also referred to as "comps."
Contingency - A provision of an agreement that keeps the agreement from being fully legally binding until a certain condition is met. One example is a buyer's contractual right to obtain a professional home inspection before purchasing the home.
Dry Rot - Decay of seasoned wood caused by fungus.
Earnest Money Deposit - A deposit made by the potential home buyer as evidence of good faith that he or she is serious about buying the house.
Easement - A right or interest in the use of the land of another which entitles the holder to some use, privilege or benefit, such as to place power lines, pipe lines or roads.
Abbreviations in Listing Advertisements
The agent shorthand found in listing ads can baffle the average consumer. Below are some of the most common acronyms and abbreviations found on listings.
AGP - Above Ground Pool
ATT - Attached
CA, CAC -Central Air Conditioning
CH/BW - Chain Link/Barbed Wire
EIK - Eat-in-kitchen
FDR - Formal dining room
FP - Fireplace
FSBO - For Sale By Owner
Gar - Garage
HDW/HWF/Hdwd - Hardwood Floors
HVAC - Heating, Ventilation and Air Conditioning
IGP - In-ground pool
MLS - Multiple Listing Service
NC - New construction
PSF - Per Square Foot
SFD - Single Family Detached
Upr - Upper floor
w/d - washer/dryer
wic - walk-in-closet
Egress - The exit point from a property.
Escrow - An item of value, money, or documents deposited with a third party to be delivered upon the fulfillment of a condition. For example, the earnest money deposit is put into escrow until delivered to the seller when the transaction is closed.
Energy Star - A joint program through the U.S. Environmental Protection Agency and the U.S. Department of Energy that sets energy efficiency guidelines for products, homes and businesses.
Equity - A homeowner's financial interest in a property. Equity is the difference between the fair market value of the property and the amount still owed on its mortgage and other liens.
Fixtures - Those parts of a property affixed to structures or land, usually in such a manner that they cannot be independently moved without damage to themselves or the property housing supporting or pertinent to them. Fixtures are usually included in a sale and commonly include but are not limited to items such as carpets and awnings.
Full Disclosure - In real estate, revealing all the known facts which may affect the decision of a buyer or tenant. A broker must disclose identified defects in the property for sale or lease.
Green building - Also known as sustainable building or environmental building, this definition varies depending on the agency or group. Generally it means to construct a building to the highest environmental standards by minimizing the use of energy, water and materials. A green building, for example, might have skylights, recycled building materials and solar panels.
Ingress - The entry point to a property.

Lien - A legal claim against a property that must be paid off when the property is sold. A mortgage or first trust deed is considered a lien.
MLS (Multiple Listing Service) - An MLS is an organization that collects, compiles and distributes information about homes listed for sale by its members, who are real estate brokers. MLS's are local or regional.
Private mortgage insurance (PMI) - Mortgage insurance that is provided by a private mortgage insurance company to protect lenders against loss if a borrower defaults. Most lenders generally require PMI when the amount borrowed exceeds 80% of the purchase price or home's value.
Plat - A plan, map or chart of a tract or town site dividing a parcel of land into lots.
Subdivision - An area of land laid out and separated into lots, blocks, and building sites, and in which public facilities such as streets, alleys, parks, and easements for public utilities are also planned.
Sweat equity - used to describe the contribution made to a project by people who contribute their time and effort.
Title - A legal document evidencing a person's right to or ownership of a property.
Title company - A company that specializes in examining and insuring titles to real estate.
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ARM loans: A risk worth taking?

2010-02-23T15:54:00.000-06:00

Part 1: Mortgage selection in post-crisis market
Jack Guttentag
Inman News

Editor's note: This is Part 1 of a two-part series.

One of the most critical decisions mortgage shoppers must make is the type of mortgage that best meets their needs. The importance of the decision has been heightened by a post-crisis market in which price differences between all categories of mortgages are unusually large.

The decision process can be divided into three parts: The first is whether to select an adjustable-rate mortgage (ARM) or a fixed-rate mortgage (FRM). All ARMs today are 30 years, and in this article we compare them to a 30-year FRM.

The second part of the decision process, for those who elect the FRM over the ARMs, is to select the term of the FRM.

The third part is to decide whether or not to take an interest-only payment option. Parts two and three are the subject of next week's article.

FRMs offer borrowers interest rate and payment stability. This is particularly advantageous to borrowers who are not sure how long they will have their mortgage, and who find the FRM payment affordable. ARMs offer borrowers a lower interest rate and payment in the early years, which is particularly advantageous to borrowers who know about how long they will have their mortgage. ARMs also work for borrowers who require the lower initial rate to make the initial payment affordable, and can handle the risk of rising payments in the future.

Taking account of price differences: Borrowers should take account of the price differences between FRMs and ARMs in deciding between them. If there is no or little price difference, there is no good reason to select an ARM.

This was the case when I last addressed the issue in 2006. On Oct. 8 of that year, I shopped for a $320,000 loan on a $400,000 single-family home in California to a borrower with excellent credit and adequate documented income. The market at that time offered this borrower a 30-year FRM at 6 percent and zero points, and a 3/1 ARM at 5.75 percent and zero points. The 5.75 percent rate held for only three years, after which the rate adjusted every year.

My conclusion at the time was that the 0.25 percent price difference between the FRM and the 3/1 ARM was not large enough to justify the price risk on the ARM -- with the possible exception of borrowers who confidently expected to be out of their house within three years. ARMs with initial-rate periods of five, seven and 10 years were priced between the FRM and the 3/1 ARM, making them even less attractive.

Today, the price differences are much larger and ARMs are correspondingly more attractive. On Jan. 8, 2010, I shopped the same loans described above. The 30-year FRM was 5.125 percent and the 3/1, 5/1, 7/1 and 10/1 ARMs were 4 percent, 4.125 percent, 4.5 percent and 4.875 percent, respectively. The borrower taking the 3/1 ARM rather than the FRM now saves 1.125 percent in rate rather than 0.25 percent. Note that while market prices change every day, the price differences between FRMs and ARMs are relatively stable in the short run.

ARM borrowers with short time horizons: When the pricing is advantageous, the most logical candidate for an ARM is the borrower who expects to be out of the house before the initial-rate period is over. While few borrowers can be certain about this -- life sometimes confounds our best plans -- the rate savings should substantially outweigh the risk of being caught by a rate adjustment. If you expect to be out within three, five, seven or 10 years, select a 3/1, 5/1, 7/1 or 10/1 ARM, as the case may be.

ARM borrowers who need the lower initial payment: A second reason to select an ARM is the lower initial payment associated with the lower initial rate. In some cases, the borrower needs the ARM in order to meet the lender's underwriting requirements, which include maximum ratios of mortgage payment and other expenses to borrower income. In other cases, borrowers need the ARM to meet their own views of what constitutes an affordable payment.

Borrowers who select an ARM because they need the lower payment assume the risk of a possible rate and payment increase at the end of the initial-rate period. Borrowers faced with this decision should ask themselves: "Is this a risk worth taking" and "Can I afford to take it?"

The best way I know to deal with these questions is by determining what will happen to the rate and payment on the ARM if market interest rates change in ways that the borrower specifies. This "scenario analysis" provides a measure of the risk if rates increase, and the benefit if they don't. It also allows borrowers to determine the extent to which they can reduce the risk on the ARM by making the larger payment that they would have made had they selected the FRM.

To do a scenario analysis, you must know all the features of the ARM that affect future rates and payments: the rate index used by the ARM; its current value; rate adjustment caps; and the lifetime maximum rate. You should have this information anyway; otherwise, you don't know whether you have found the best deal on your ARM.

Readers who want to do a scenario analysis on an ARM will find an explanation of how to do it, with an example, on my Web site in Choosing Between Adjustable and Fixed Rate Mortgages.

The writer is professor of finance emeritus at the Wharton School of the University of Pennsylvania. Comments and questions can be left at www.mtgprofessor.com.

***

What's your opinion? Leave your comments below or send a letter to the editor. To contact the writer, click the byline at the top of the story.

Copyright 2010 Jack Guttentag

Short sale buyers seek closure

2010-02-23T15:51:00.000-06:00

New guidelines offer glimmer of hope

Benny Kass
Inman News

DEAR BENNY: Almost six months ago, we made an offer to buy a condominium, under a short-sale arrangement. Our real estate agent called it a clean deal, as we are paying cash and all closing costs.
Our agent has called the listing agent and I have called the bank that holds the current mortgage (although they say they cannot discuss this with me for legal reasons) to try to learn why we cannot get an answer to our offer. My wife and I are anxious because we want to resolve this one way or the other. Didn't our president get a new law enacted that is forcing the banks to respond promptly? We need some help, and the bank is dragging its feet. --Bob

DEAR BOB: Although the federal government is attempting to get lenders to shorten the time they have in which to respond to short-sale proposals, there currently is no federal law on this subject.

However, on Nov. 30, 2009, the Department of the Treasury issued guidelines that lenders are encouraged to follow. It is a complex process. Homeowners who are underwater can request that their lender preapprove short-sale terms. Although it is not clear how long the lender (or the servicer of the mortgage) has to respond, once the lender determines the amount it will be willing to accept from a short sale, the borrower has 120 days in which to find a buyer for the property.
When the homeowner enters into a sales contract with a potential buyer, and assuming that the lender has already preapproved the terms and conditions for a short sale, the lender must approve or disapprove the short sale within 10 business days after receiving the sales contract.
Accordingly, if you are a homeowner in financial trouble, talk with a real estate agent to start the preapproval process. This will take the most time, so you should begin this as soon as possible. There is a lot of paperwork involved that has to be presented to the lender.
The Treasury directive requires that once the short sale takes place, the homeowner/seller must be fully released from future liability. This has been a real problem in the past, since many lenders -- after allowing a short sale -- were still going after their borrowers for the deficiency -- the difference between the net sales proceeds and the outstanding balance of the loan.
You can access this directive from the Web site of the Home Affordable Modification Program. Although lenders are encouraged to follow the guidelines now, technically they do not take effect until April 5, 2010, and will sunset Dec. 31, 2012.
DEAR BENNY: I am shocked by the extent of the deception and downright fraud being perpetrated on timeshare sellers through so-called "timeshare marketing" companies. My wife has been handling the listing of our "timeshare week" and has signed up with at least four companies. Each promise quick results or money back.

Once you start you are on the "list" and start receiving calls from multiple "boiler room" operations stating that they have an offer in hand, usually at more than you have listed the property at. All they want to proceed with the deal is $900 to cover expenses with title search, etc. Most if not all of these outfits operate out of Florida in the Orlando and Palm Beach areas.
I have contacted the attorney general's office of Florida and basically was told to be careful and not to give any money up front. These companies swear that they have buyers and that we should trust them.
This could be one of the biggest scams presently going on in the U.S. The targets are usually seniors, like my wife, who used her Social Security money to advance a couple of these companies. Of course, they never call back. It would be interesting to see how many of your readers have been approached by these operations and what their experience has been.
If you question the callers too much or ask hard questions, they simply hang up. I have written a couple of Better Business Bureaus in Florida and they are sympathetic but have no remedy.

I suggest it is time for the attorney general of Florida to conduct an investigation into this matter and grand juries should be convened to also address the issue. To date, despite numerous requests, we have not had any money returned.

I have a fairly good e-mail record of communications with these companies, many of which simply go out of business and open up somewhere else in the state. Florida is too lax and senior citizens are being hurt. --Jack
DEAR JACK: Many thanks for sending me this information. Because it is very important, and because a lot of the e-mail questions I receive involve timeshares, I am sharing your comments with my readers.
I can't force the attorney general of Florida -- or any state for that matter -- to investigate these companies, but if enough consumers send complaints to their elected representatives (both in Congress as well as at the state and local level), perhaps some action will be taken.
Furthermore, because so many people want to sell their timeshare interests, perhaps the industry itself should create a mechanism for this.
In the meantime, if you are approached by a timeshare salesperson, here are some suggestions. First, ask yourself: "Do I really want this? Is it really worth the money?"

Next, don't be pressured into signing up the first day. Despite statements by the salesperson that all benefits are good for today only, sleep on the proposal for at least one day. High-pressure sales tactics are rampant in the timeshare industry.
Ask for copies of all documents and contracts that you will have to sign, and take them to your lawyer for review. If the salesperson tells you that you cannot take those documents with you, politely tell him or her "thank you" and walk away.
Finally, if you are trying to sell a timeshare, follow the advice of the attorney general. Do not give anyone money up front. You can sign a contract declaring that if your timeshare is in fact sold, the company that located the buyer will be paid when the closing takes place.
DEAR BENNY: I am the president of a condominium association. We are presently experiencing a roof leak from a limited common element (patio over an area of the roof). This area can be accessed only through the owner's unit, as it is on the top floor of the building and is for the owner's use only.

Who has the responsibility to repair these leaks: the board or the unit owner? This has not become an issue to date with the owner, but it could in the future and I was wondering how the board should proceed on this matter if it does become an issue. --Dan
DEAR DAN: You have called this a patio, and I call it a "roof deck." Either way, it is a limited common element, which means that although it is not within a unit (it is technically located in a common area) not all owners have access to that area.
You have to review your association's legal documents and especially the bylaws. Most documents I have seen place the maintenance responsibility on the association. Why? Because if someone were injured or the property were damaged as a result of a problem coming from a limited common element, the association would be sued (as well as the unit owner who owned the limited common element), and could be found liable and required to pay a lot of money. Additionally, the unit owner may decide not to do the repairs, and further damage would result.
Access to the roof should not be a problem. If the unit owner refuses to allow a contractor access through his unit so as to get to the roof, the board can file suit asking a judge to force the owner to provide access. Indeed, I suspect there is language to that effect in your legal documents.
The real question is "Who pays for the repair?" Again, your bylaws may be helpful. Some require that the limited common element unit owner reimburse the association for any such repair costs. Unfortunately, many legal documents are silent on this issue.

And while it is clearly unfair for owners who do not have access to the roof deck to have to pay for any maintenance and repair costs, since it is a common element, all owners may have to share in these expenses.
Your state may have some court decisions on this issue, so talk with the association's attorney for specifics.

Benny L. Kass is a practicing attorney in Washington, D.C., and Maryland. No legal relationship is created by this column. Questions for this column can be submitted to benny@inman.com.

What's your opinion? Leave your comments below or send a letter to the editor. To contact the writer, click the byline at the top of the story.
Copyright 2010 Inman News

Tax credit extended April 2010!

2010-02-17T20:57:00.001-06:00

Now homeowners can take advantage of tax credit until April 30, 2010.

Krista Votruba joins The Piercy Group

2010-02-17T20:36:00.002-06:00

The Piercy Group is very proud to have Krista Votruba join us. Krista's full bio will be posted shortly on our website.

It still pays to remodel

2010-02-17T20:26:00.001-06:00

Survey identifies most cost-effective home improvements

Dian Hymer
Inman News

The home-sale market has taken a beating in the last few years, which begs the question: Does it makes sense financially to invest in home improvements?

Remodeling Magazine's annual Remodeling Cost vs. Value Report for 2009-10, published in agreement with the National Association of Realtors, indicates that remodeling still pays off, but more so on less expensive projects.

Most high-end remodeling projects don't return dollar for dollar on the investment even in a good market. That is, unless homes are appreciating at a fast clip. In this case, you might get your money back due to appreciation. But the profit on the sale might not be as much as it would have been if you hadn't done a high-end renovation.

Just as today's homebuyers are making pragmatic decisions, so are today's homeowners when it comes to making improvements. Most of the remodeling projects with the largest return were for such things as replacing exterior siding and windows. On average the cost involved was less than $14,000, according to Remodeling Magazine.

These projects returned from 71 to 83 percent nationally depending on the materials used. The project that paid back the highest return was a midrange front-door replacement that cost approximately $1,200 and returned an average 128.9 percent nationally.

Sellers may wonder why it would make sense to invest in an improvement just for the sake of selling if it won't repay the amount invested. In today's challenging home-sale market, these improvements may be warranted for the home sell at all if there is a lot of inventory in your neighborhood. Buyers expect more for their money and gravitate to listings that are in the best condition for the price.

HOUSE HUNTING TIP: Be judicious about how you spend your money fixing your home up for sale. For example, if your kitchen is a disaster, it makes more sense to do a midrange than an upscale renovation. According to the Remodeling Cost vs. Value Report, a midrange minor kitchen upgrade will return an average of 78.3 percent nationally. A major upscale kitchen remodel will pay back only 63.2 percent.

The national average returns on remodeling investments do not give an accurate picture of the renovation returns that might be typical in your neighborhood. For instance, the payback for Honolulu homeowners for most of the 18 remodel projects analyzed returned 100 percent of the investment. San Francisco was close behind with 10 projects paying back the full investment.

The Cost vs. Value Report recommends the following cost-effective improvements you might consider to prepare your home for the market: tidying up the kitchen cabinets using organizers will make your cabinets roomy; add an inexpensive tile backsplash to a tired kitchen, and use inexpensive tile to give an old bathroom a new look; add a breakfast bar by cutting an opening between the kitchen and family room; and install granite tile rather than slab.

Other suggestions include: replacing outdated light fixtures; freshening up the basement; giving the kitchen cabinets a new look by reconditioning and adding new knobs or having cabinet doors and drawers replaced; updating a bathroom without replacing tile by changing the medicine cabinet, light fixtures, vanity, cleaning the grout or replacing it and adding glass shower doors.

The findings of this report were based on a survey sent to 150,000 appraisers and real estate agents in the summer of 2009. The survey included information about the cost and description of the remodel projects and median price data for the 80 metropolitan areas surveyed. Some 6,233 survey respondents estimated how much value the improvements would add to the house at resale in the current market.

THE CLOSING: Before starting any fix-up-for-sale projects, seek your real estate agent's advice so that you don't waste money on improvements that won't pay back much in your area.

Dian Hymer, a real estate broker with more than 30 years' experience, is a nationally syndicated real estate columnist and author of "House Hunting: The Take-Along Workbook for Home Buyers" and "Starting Out, The Complete Home Buyer's Guide."

***

What's your opinion? Leave your comments below or send a letter to the editor. To contact the writer, click the byline at the top of the story.

Copyright 2010 Dian Hymer

Tax bite from selling moms house?

2010-02-17T20:21:00.002-06:00

Defer capital gains hit with 1031 exchange

Benny Kass
Inman News

DEAR BENNY: After my father-in-law passed away, my husband's mother moved to be near us and bought a home, eventually putting it in my husband's name. She passed away four years ago and my husband has not sold the home. We are a few years away from retirement. Would it be better to wait until his income is lower to sell or sell now? We really don't know what to do and I think my husband worries about the big tax bill he will get. --Irene

DEAR IRENE: I suggest you discuss the tax situation with your financial advisors. I cannot advise you or even speculate on what your tax bill might be if and when you sell the property. You have to determine what the tax basis of the property was on the date your mother-in-law died, and (depending on what state you live in) you may be eligible for what is known as the "stepped-up" basis -- i.e., the value of the property on the date of death. (Note: For 2010 only, this concept is not applicable unless Congress changes its mind.)

But if you are nearing retirement, and plan to move to another area, have you considered a Starker (section 1031 exchange)? The house in question is not your principal residence and thus would be considered investment property.

Let's say you want to move to Florida two years from now. You sell the house, and exchange it for a rental property in Florida. After renting it out for a year or two, you move into it and declare it your principal residence. The tax basis of the new property will be the basis of the exchanged property, but you will not have to pay any tax now if you follow the procedures of such an exchange.

You will need professional guidance to do it right.

Also make sure that the house is in the name of your husband only. If it's not, you may have to probate your mother-in-law's estate so that the property will go into his name.

DEAR BENNY: I am an 81-year-old widow who bought a townhouse four years ago. There were some odd things going on here so I installed a security system. I have been told that the security sign I have in front of the townhouse is considered advertising and I have to take it down. There are three other areas in town that have townhouses and none of them have a problem with this. What happens if I refuse to take the sign down? --Lillian

DEAR LILLIAN: Different associations have different rules and regulations, and all homeowners are legally obligated to follow those rules. If your association does not permit signs to be posted outside your home and you refuse to remove your sign, the board of directors could fine you and/or ask a court to require you to honor and follow those rules.

That's a general answer as to the things that association boards of directors can do if a unit owner fails to comply with the rules. However, in your case, you should meet personally and talk with the president of the association. Explain your situation and ask for a waiver of the rules. Point out that your sign really is not advertising.

If the board refuses, I suggest that you contact an attorney to assist you. I am sure you can find a lawyer who will take your case on a no-fee basis called "pro bono." Also, AARP may be able to assist you.

However, let me ask this question. While I understand that you want the outside world to know that you have a security system in your house, do you really need that outside sign? Isn't it sufficient that you have the actual system installed in your house? Perhaps you and the board can reach some kind of compromise -- such as having a sign in your window so that outsiders will be on notice of that system.

DEAR BENNY: Could you please give me the IRS citation number of the repeat credit. I cannot find it on the IRS Web site. --Richard

DEAR RICHARD: I received a number of questions about the "repeat credit," but did not know what they were asking about. I e-mailed one of my readers, who explained this was the new law that allows present homeowners -- under certain conditions -- to claim a tax credit previously available only to first-time homebuyers.

You can get information on both credits on the IRS Web site (www.IRS.gov) here, or by typing in "first-time homebuyer credit" in the search box in the upper right corner of the home page.

Last November, Congress enacted the Worker, Homeownership and Business Assistance Act of 2009. It extended the time that first-time homebuyers could get an existing tax credit of up to $8,000 beyond the previous Nov. 30, 2009, deadline. Now, in order to be eligible for the credit, you must have a binding sales contract signed by April 30, 2010, and must actually go to closing (also called "escrow") before July 1, 2010.

There are a number of restrictions, including income limitations, and you should consult with your own tax advisors to make sure that you are eligible.

In extending the first-time homebuyer tax credit, Congress also allowed some existing homeowners to claim a smaller credit, which some of you have labeled as a repeat credit. If you currently own a home that you have used as your principal residence for any consecutive five-year period during the eight-year period that ended on the date that the replacement home is purchased, you may be eligible for a $6,500 credit. Once again, your sales contract must be signed by April 30 and in settlement before July 1, 2010.

DEAR BENNY: You recently wrote about how "limited common elements" can include a person's patio. I haven't heard the term "limited" before relative to common elements. In the case you cited, I understand you to mean that the condominium association has the right to have its architectural review committee set some standards for limited common elements, such as patios. I presume this also pertains to wooden decks and balconies that are accessible only from the inside of the unit. If so, does this mean that the association is liable for the repair of cracked decks or deteriorating external rear wooden decks/balconies as they would be if these were deemed to be common elements? --Lew

DEAR LEW: Every condominium contains three basic elements: the common elements (such as the roof, elevator or main entrance); units (the place in which owners physically reside, usually described as wall-to-wall and ceiling-to-floor); and limited common elements. The latter is a common element but is not accessible to every unit owner. Typically, a limited common element (LCE) is a patio, a deck and even a mailbox. Some parking spots are also LCEs although they could also be a separate unit or merely a space in a general common element.

Why are they called limited common elements? Because they are not within the physical unit itself.

Most legal documents in a condominium association (usually the bylaws) give guidance as to who is responsible for the maintenance and repair of units and common elements. And from my experience, the association is usually responsible for the LCEs.

This makes sense. The condo board (and indeed a majority of unit owners) wants some kind of uniformity in their community. They do not want unit owners placing gas grills, for example, on their balconies, or anything else that may become a health hazard. Recently, I represented a condominium association that had to take a unit owner to court because she had a hot tub on her balcony.

But there is a more basic reason why the association must have the authority to control these LCEs. If, for example, a unit owner has a defective balcony and decided not to repair it, it could collapse and cause damage to someone walking down the street.

So, yes, the association could be legally responsible for any damage or injury to property and person caused by a limited common element.

However, that does not mean that the owner who has exclusive access to the limited common element is always off the hook for the costs involved in repairing those areas. Clearly, it would be unfair if the owners who do not have balconies have to pay for those repairs. Accordingly, some association documents -- while reserving the repair and maintenance responsibility to the association -- have the payment assigned to those who have such LCEs.

Read your own legal documents and talk with the association's legal counsel.

Benny L. Kass is a practicing attorney in Washington, D.C., and Maryland. No legal relationship is created by this column. Questions for this column can be submitted to benny@inman.com.

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Copyright 2010 Benny L. Kass

Author: Benny Kas

Piercy Group Website Launched

2010-02-02T14:19:00.001-06:00

February 02, 2010 – The Piercy Group, the leading real estate firm serving the Kansas City Metropolitan area, proudly announced the launch of its new interactive website – PiercyGroup.com. This website is a significant addition to the online world of real estate; designed to be the singular resource for Leawood, Waldo, Prairie Village and Brookside Kansas City homes for sale, the site complements the many outstanding services the firm offers its clients.

The Piercy Group has been specializing in the Kansas City residential real estate market for a decade, and works with a wide range of clients in this thriving area. Led by Realtors® Wesley Piercy, Catherine Jackson, George Rodri and Krista Votruba, this award-winning firm specializes in everything from the popular condo market to luxury homes. They are also well versed in foreclosures, short sales, and HUD properties, which is especially valuable as these markets are highly challenging for buyers. The advanced skill and experience of the firm is clear from their approach to the website – this is one of the most approachable, straightforward and useful online experiences to date.

The eye-catching homepage presents a sense of organization and unity that is rarely seen in competing real estate websites. It is well laid out from top to bottom, presenting a horizontal navigation bar, a pleasant slideshow, and a welcome message. The set of quick links at the bottom of the homepage offers excellent information on the area, from Prairie Village Kansas City condos for sale to Waldo Kansas City real estate. Visitors can access the pertinent sections of the website from the navigation bar like the ‘Resources’ page that details everything from community profiles to eco-friendly resources. The ‘Buyers/Sellers’ section provides useful information about tackling the real estate process. Finally, ‘Our Team’ is an excellent introduction to the firm’s talented members.

Buyers should pay particular attention to the complimentary MLS search that will get them started on their search for Leawood, Brookside and Prairie Village KS homes for sale in just a few simple steps.

The Piercy Group has indeed achieved another step that confirms its status as the premier firm in the area. To learn more, visit www.piercygroup.com today.

About The Piercy Group: Located in Leawood, Kansas, The Piercy Group is the leading real estate firm specializing in the Kansas City Metropolitan Area, including the communities of Brookside, Waldo, Prairie Village and Leawood. Associated with RE/MAX, the firm has earned multiple awards including the Executive Club Award and the Cooperative Spirit Award. The firm is also highly active in the community, working with charities such as Operation Smile, Children's Miracle Network, Susan G. Komen Foundation, amfAR, and Human Rights Campaign.

2010-02-01T20:40:00.001-06:00

Don't forget to come see us tomorrow and have lunch at our newest listing. 220 E. Winthrope Road, Kansas City, MO. 11 am - 1 pm

SOME GOOD NEWS REGARDING HOMES SALES FROM NAR REPORT

2008-03-25T10:30:00.001-05:00

In what may be the first fluttering of a recovery in the housing market, sales of existing homes last month actually increased from January levels according to the National Association of Realtors (NAR.)
Sales of previously occupied single-family houses, condominiums, co-ops and town houses rose 2.9 percent in February to a seasonally adjusted annual sales rate of 5.03 million units. The January sales level was 4.89 million. In spite of the encouraging small increase, February’s rate was still 23.8 percent below the 6.60 million pace one year earlier.
NAR's chief economist Lawrence Yun said the increase is encouraging. "We're not expecting a notable gain in existing-home sales until the second half of this year, but the improvement is another sign that the market is stabilizing," he said. “Buyers taking advantage of higher loan limits for both FHA and conventional mortgages will unleash some pent-up demand. As inventories are drawn down, prices in many markets should go positive later this year."
Sales of single-family homes increased 2.8 percent to an annual rate of 4.47 units from an upwardly revised estimate of 4.35 million in January but are still 22.9 percent lower than the 5.80 million sales in February 2007. Condo and co-op sales did a little better, rising 3.7 percent to 560,000 units from January’s level of 540,000.
Another bit of good news; inventories of existing dwellings fell 3.0 percent in February to 4.03 million homes available for sale. This is a 9.6 month supply at the current rate of sales compared with a 10.2 month supply in January.
Prices did continue to drop, with the median price of all housing types dropping to $195,900 in February 2008, a decrease of 8.2 percent from the median of $213,500 in February 2007. NAR said that the slowdown in sales from a year ago is greater in high-cost areas, so there is a downward pull to the national median with relatively fewer sales in higher priced markets.
The median price of single-family houses was down 8.7 percent year-over-year to $193,900 and the median existing condo price was $211,700, 4.9 percent lower than a year ago.
Readers of the survey were advised to look as well at home prices within metropolitan areas. Roughly half of the metro areas in the U.S. have had price increases with healthy gains in markets such as Oklahoma City and Trenton, New Jersey. "In other areas such as Sacramento, a rapid price decline has induced buyers to come into the market and sales are now rising," Yun said. "The relationship between home prices, interest rates and income has improved to the point where buyers are more serious about making offers."
In virtually every housing report we have seen over the last few months the situation in the Northeast seems to be improving faster than in other parts of the country. That is true of the current existing home sales report wherein sales in the Northeast were up 11.3 over January but are remain 26.4 percent below February 2007. The median price in the Northeast was $264,800, up 0.4 percent from a year ago.
Two of the other regions also showed increases. Existing-home sales in the Midwest rose 2.5 percent last month while lagging behind February 2007 sales by 19.5 percent. The median price in the Midwest was $143,900, which is 7.1 percent lower than February 2007.
In the South, sales increased 2.1 percent but are 22.0 percent below February 2007. The median price in the South was $163,400, down 8.6 percent from a year ago.
Sales in the West slipped 1.1 percent month-over-month and are 29.2 percent below a year ago. The median price in the West was $290,400, down 13.4 percent from February 2007.

PLAYING THE HOUSING SLUMP?

2008-03-25T10:29:00.001-05:00

By Jonathan Clements From The Wall Street Journal Online
Financial lore says you should buy when there's blood in the street -- which suggests real estate is a bargain, because there's blood all over the neighborhood.
Time to invest? I wouldn't be surprised to see home prices drop sharply this spring, as long-suffering sellers in hard-hit areas throw in the towel and slash their asking price.
That could spell opportunity for this year's buyers. But what if you already own a home -- and have no desire to become a landlord? Here are three ways to play today's battered housing market.
Trading up. If you're hankering after a larger home or a house in a better neighborhood, this could be your chance to trade up on the cheap.
To be sure, when you go to sell your current home, you will likely get a modest price. Since 2006's second quarter, real estate has fallen 10.2%, as measured by the S&P/Case-Shiller U.S. National Home Price Index. But your new, grander house will also be relatively inexpensive, so you're effectively cranking up your real-estate exposure when the market is well below its peak.
That said, I wouldn't think of this move as an investment. Your new home will probably mean not only a bigger mortgage, but also higher ongoing costs, including homeowner's insurance, property taxes and maintenance expenses. These ongoing costs will offset a large chunk of any future home-price appreciation.
In other words, trading up to a larger home or a better neighborhood is really about wanting to consume more real estate. Still, like any thrifty shopper, you want to buy when there's a sale -- and that is what today's market offers.
"It's like going from a Honda to a Mercedes," says Charles Farrell, a financial adviser with Denver's Northstar Investment Advisors. "It's a lifestyle choice. As long as it doesn't cut into your ability to accumulate capital for retirement, this is probably a pretty good time to upgrade."
Doubling down. Instead of trading up, you might be eyeing a vacation home. If you don't plan to rent the place out, the same logic applies: Once you subtract the annual costs from the price appreciation, you likely won't make very much money -- which means the property won't be much of an investment.
On the other hand, maybe you're two or three years from retirement and are toying with buying a second home that could become your sole residence once you quit the work force. Does it make sense to purchase now, given the decline in home prices?
Buying today is no doubt appealing, because it'll give you a chance to vacation in your future home. But whether it turns out to be a wise financial move depends on what happens to property prices -- and that's tough to predict.
Still, I wouldn't bank on a rapid bounce back in home prices. At the current sales pace, it would take a whopping 10.3 months to clear January's backlog of unsold homes. By contrast, in January 2005, the supply of unsold homes was at a mere 3.6 months, according to the National Association of Realtors.
The bottom line: If you think you'll get a lot of use from a second home, go ahead and buy. But if you view the purchase as a bet on rising home prices, I would hold off for now.
Helping hand. While buying more real estate for your own use probably won't be a great investment, you could help your adult children make good money -- by transforming them from renters to homeowners.
To that end, you might give your kids an advance on their eventual inheritance, so they have enough money to make a down payment. Yes, that means they will start to incur the housing costs I mentioned above, including property taxes and maintenance expenses. But your children will also replace their monthly rent check with a monthly mortgage check, and that will allow them to start building home equity.
"If you have kids who are first-time buyers in markets that are relatively depressed, this could be a good time," Mr. Farrell reckons. "These days, they might need to make a 10% down payment. You could make a gift to them of the down payment or make a loan to them."

TEN FHA HUD FACTS TO KNOW

2008-03-25T10:25:00.000-05:00

HUD Home Fact #1
About the FHAThe Federal Housing Administration (FHA), an agency of the federal government, insures private loans that are issued for new and existing housing, and loans that are approved for home repairs. Created by congress in 1934, the FHA became part of the Department of Housing and Urban Development's Office of Housing (HUD) in 1965. Today the mission of the FHA includes helping borrowers get amounts they qualify for, and assisting lenders by reducing their risk in issuing loans. To find out if you might be eligible for an FHA-insured loan, contact us.
HUD Home Fact #2
Credit Problems and a HUD Housing LoanIt is advisable to approach any FHA loan with your best possible credit rating. If you have had credit problems in the past, the FHA recommends a Consumer Credit Counseling program to avoid being denied an FHA loan. A good credit counselor can talk to you about income-to-debt ratio, maintaining satisfactory payments and challenging errors on your credit report. The FHA recommends creating a satisfactory payment history for at least one year before applying for any FHA loan program.
HUD Home Fact #3
The FHA TOTAL ScorecardIf you submit FHA paperwork electronically, the FHA TOTAL Scorecard is used to measure the credit risk of all FHA loans submitted through the automatic underwriting system. Your FHA loan is processed through a qualified and approved FHA lender. Applications submitted through FHA TOTAL are evaluated by a standardized scoring procedure creating a quick, fair and seamless evaluation. The FHA's TOTAL system is internet based and works in real time.
HUD Home Fact #4
Applying for an FHA LoanThe FHA asks for a lot of information on your FHA loan application. You will need to provide the FHA with a wide range of details including:
All addresses where you have lived in the previous two years.
Your employer's name and addresses for the last two years, plus the amount of your Gross Monthly Salary.
W2s for the past two years.
Income tax forms submitted for the last two years.
Gather all of this before you begin your FHA application so you will have everything handy to complete your FHA loan forms at one time.
HUD Home Fact #5
Additional Paperwork for VeteransThe FHA asks that veterans submit the DD Form 214 along with their FHA loan application paperwork. The DD Form 214 is the official record of discharge from the Armed Forces. If you have recently separated, retired or otherwise left active duty and don't have your DD Form 214, request a copy from either your final outprocessing base (call the orderly room, records office or outbound assignments/outprocessing office), or request the form electronically from the Department of Defense
HUD Home Fact #6
FHA/HUD Insured Mortgages and RefundsIf you have an FHA loan or HUD insured mortgage, you may have paid an "up-front" mortgage insurance premium at the closing of your house. Assuming you did not default on your mortgage payments, you may be eligible for a refund on part of your insurance premium. Loans granted after September 1, 1983 may be entitled to this refund. Check your FHA loan settlement paperwork or phone your lender to learn more. If you need further assistance, contact your FHA loan officer for help.
HUD Home Fact #7
Popular FHA LoansThe 203(b) FHA Fixed Rate Mortgage Loan Program is the widely used FHA home loan, especially among first time home buyers. The 203(b) FHA loan keeps your down payment to a minimum. Your closing costs may also be reduced. The 203(b) FHA loan will finance up to ninety-seven percent of your loan. You must qualify with some debt-to-income ratios, but the 203(b) does not have a minimum income requirement. Check with a financial planner about your debt to income ratio, or discuss your financial status with a lender. Find out how to maximize your credit rating before you apply for your FHA loan.
HUD Home Fact #8
Where FHA Mortgages Come FromFHA loans do not come directly from the FHA. The FHA guarantees home loans, reducing the risk to lenders and offering increased borrowing power to qualified applicants. You may bet better interest rates thanks to FHA home loan insurance. FHA loans are particularly helpful for who want a home, but have little or no money saved for a down payment; including those just graduating college, newly married couples, and also those who have had credit problems in the past because of foreclosure or bankruptcy. Check out your credit rating and get a list of lending limits for FHA loans in your area which vary from state to state, and may even vary by county.
HUD Home Fact #9
Pre-qualify for an FHA Home LoanTo pre-qualify for an FHA loan, you should be able to demonstrate employability, job stability and reliability. To the FHA, reliability includes holding a steady job for at least two years with the same company or employer and increasing or at least maintaining consistent income. The FHA would like to see that any foreclosures or bankruptcies on your record are at least three years old. The FHA loan bottom line: demonstrate that you have been a good credit risk for two years or more and you will have a much better chance at pre-qualifying for an FHA loan.
HUD Home Fact #10
The Increased FHA Loan AmountIn early 2006, a HUD press release announced an increase of nearly thirty thousand dollars in FHA-insured home loan money being made available to borrowers for single-family home mortgages. This increase signals more borrowing power with your FHA home loan, and it allows more people than ever the opportunity to own a home. With only a three-percent down payment and a single-family home mortgage limits coming closer to two hundred thousand dollars, now may be the best time to apply for an FHA home loan. First, evaluate your finances; your monthly housing costs should not exceed more than 29% of your gross monthly income. Use gross income, not net income, when evaluating your finances to apply for your FHA loan.

$100 HUD REPO PROGRAM NOW AVAILABLE

2008-03-25T10:23:00.000-05:00

March 7, 2008 – $100 HUD Repo Program Now Available in Kansas and Missouri
The FHA HUD Repo Program which allows the borrower to make only a $100 downpayment when purchasing a HUD repossessed home has now expanded to include Kansas and Missouri. Borrowers are only required to make a $100 downpayment instead of the normally required 3% investment. In certain cases the borrower and perhaps even the selling real estate agent may be eligible for additional incentives. The $100 HUD Repo program allows for a maximum LTV up to 110% in order to finance closing costs and prepaid expenses above 100%.
FHA continues to provide highly competitive interest rates and mortgage insurance premiums for borrowers who have had credit challenges in the past as well as for those that have not.