Please Drive Responsibly

Please use your hands free headset. Here is a website where you will likely find the headset used by your phone and can get it for just the shipping cost. Please look at

http://www.freeheadset.org/

my shout out to all I see still using their hand set is

Get off the phone and drive.

Please be careful and drive responsibly thanks

Herm.

Handyman or Contractor?

courtesy of : By Bill Lederer;Founder - CompleteLandlord.com

When looking for a professional to do work on your property, how do you know whether to hire a handyman or a contractor? Consider the distinctions between the two types of workers.

1) A handyman is best for small- to medium-sized jobs that require a wide range of skills and attention to detail.

These individuals are generally less expensive than contractors, but the work may take longer to complete. A handyman can do about $500 worth of work per job, per day and often works alone or with a small crew. The benefit of this is that there is less disruption on the property. Foot traffic from a contractor’s large crew in your property could be heavy.

2) Hire a contractor if you have a larger project, especially one that requires expertise in several areas, such as plumbing, drywall, electrical or carpentry work.

The contractor will coordinate all professional subcontractors and the timing of their work, and you benefit from having a single contact person. Also, most major projects, such as renovations and additions, require building permits that only a contractor can secure.

Beware: Eminent Domain

courtesy of CompleteLandlord.com

Many people are unaware that the government can, in some circumstances, forcibly take your property, even if you are complying with all laws.

It is a law known as eminent domain and it allows the government to seize your property (also referred to as expropriation) if they intend to use it for public benefit or need as long as they provide you with what they determine is just compensation.

Though most uses of eminent domain are for public utilities or roads, a recent expansion of this law means it is now possible for the government to expropriate your property to benefit private developers if they demonstrate even a modest measure of public use.

The 2005, Supreme Court case Kelo v. City of New London broadened municipalities' rights; they can now bulldoze buildings to make way for hotels or shopping malls. Before the Kelo case, properties were only demolished to make way for projects with demonstrated public need.

The Kelo case expanded this definition incredibly, allowing the government to take property for use by a private developer, opening the door for abuse of power by influential development firms.

Keep yourself informed about eminent domain decisions made in your community as it is the best protection against the erosion of your rights as property owners

Owning Duplex Unit Requires Cooperation

Daily Real Estate News November 21, 2007

Buying a duplex is a lot like buying a condominium — except there are only two people in the association.

Duplex owners must compromise on repairs, maintenance, and aesthetic issues with their co-owners. In some parts of the country, the water and sewer lines are common so owners must split both usage and maintenance fees.

Decisions are typically spelled out in a party-wall agreement, which outlines each owner’s responsibilities regarding the structure.

Should one duplex owner break the rules, the other owner is technically protected because the aggrieved party can put a lien on the fellow duplex owner's property to collect funds, says James M. Mulligan, director of the Denver law firm Fairfield and Woods.

Potential duplex buyers can view the existing party-wall agreement before making a purchase. They can amend it as well, but doing so may require the approval of not just the other duplex owner but also the property insurance company and respective lenders, Wood says.

Greg Steele, an associate with Preferred Brokers in Denver, says he advises clients to meet with the duplex neighbor and see if a solid relationship is possible before making a decision to purchase.

Source: Denver Post, Christian Toto (11/18/07)

Condo Buyers Should Do Their Research

Especially since this is an excellent time to purchase investment properties for those who have cash and or credit, i want to make sure that you are reading the CC& Rs of the property you are considering to purchase. Here is an article that reiterates those sentiments and a few items to especially look for when doing so. Enjoy.

Herm.

Daily Real Estate News November 19, 2007

Condominium buyers who fail to take a close look at the condo association's rules and finances can be in for some unhappy surprises.

These documents can contain everything from the operating hours of the laundry room to plans for major construction or pending lawsuits. If the potential condo buyer reads the document and doesn’t like what’s there, the law generally says he or she can walk away from the deal.

"These statutes are built to give purchasers the information they need to make an educated decision," said Pia Trigiani, a lawyer at Mercer Trigiani, a firm that specializes in real estate transactions.Here are the some key questions a condo buyer should try to answer when reading through the association's documents:

• Is the association charging residents enough to pay expenses without going into debt?
  Is there a pattern of special assessments that may indicate poor financial management?
  Is there sufficient money or a plan to get more money to pay for the projects specified in the reserve study? Buyers should compare the budget provided in the resale package against the expenses predicted in the reserve study and see if there appears to be enough money.
  What do other residents and the management company think? Read the board minutes, which are maintained by the management company. Some companies charge a small fee for this service.

Source: The Washington Post, Renae Merle (11/17/2007)

Illegal Substances on Rental Property

courtesy of CompleteLandlord.com

Consider this sobering statistic: 50 percent of all drug labs are set up in rental properties.

As a property owner, you could be responsible for decontamination clean-up expenses averaging $6,500 for a 1,200-square-foot property.

Keeping drugs and drug labs out of your property is not only responsible landlording, it is essential to the health of your investment. Drug issues cause a decline in property value, property damage, angry neighbors and dangerous tenants. Furthermore, you could be subject to civil penalties if illegal drug manufacturing or use is occurring in your rental.

The first step toward avoiding drug problems on your property occurs during the application process. Conduct thorough background checks on rental history, credit history, employment history and criminal history of all applicants.

Meet every adult who will be occupying your building and require current photo identification to verify that you are meeting the person whose name is on the lease.

Once your tenants have moved in, be aware of suspicious behavior including:

blackened windows or drawn curtains;
frequent visitors at all hours;
paranoid or odd behavior;
extensive security measures;
excessive garbage; and
chemical odors.

It is also helpful to have a good relationship with your properties' neighbors, especially if you do not live nearby. Give them your phone number and ask them to call you if they suspect any illegal activity.

If you do discover or suspect a drug lab on your property, leave the area and call your local law enforcement agency.


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Complete Guide to Conduct Tenant Screenings
How to avoid troublemakers, late-payers and deadbeats by using "tried-and-true" screening methods for your rental properties.

Attracting & Retaining Quality Tenants KitDiscover the secrets smart landlords use to attract, screen, and choose quality tenants. Learn the easiest and most effective methods to find the best tenants.

Complete Tenant Screening
Before you let prospects sign a lease, you can run their identity through every relevant background check and search allowable by law, including: credit check, eviction, criminal history, terrorist and sex offender reports.

Browse ALL Leases and Landlording Products
Previous Week's Tips
Energy-Saving Maintenance Tips
Here are some tips I wanted to share to help lower energy bills, as well as prolong the life of your appliances. Some are a landlord’s responsibility to initiate, and others are useful to pass along to your tenants. Read More
Stop Criminal Activities on Your Rental PropertyIf a tenant’s criminal behavior is a problem, there are actions you can take to protect yourself and your neighborhood. Limit your liability and avoid trouble by working to prevent crimes before they occur. Read More

After a Fire Salvage Tips

Suggestions courtesy of: Gus Ruiz Handyman Matters,

22982 La Cadena, Laguna Hills, CA 92653. (949) 348 2625

http://www.handymanmatters.com/

Clothing - Smoke odor and soot sometimes can be washed from clothing. The following formula often will work for clothing that can be bleached:
4-6 tbsp. of Tri-Sodium Phosphatel cup Lysol or any household chlorine bleachl gallon warm water
Mix well, add clothes, rinse with clear water and dry well.
Be aware that Tri-Sodium Phosphate is a caustic substance used as a cleaning agent. It should be used with care and stored out of reach of children and pets. Wear rubber gloves when using it.

Electrical Appliances- Appliances that have been exposed to water or steam should not be used until you have a service representative check them. This is especially true of electrical appliances. In addition, steam can remove the lubricant from some moving parts. If the fire department turned off your gas or power during the fire, call the electric or gas company to restore these services - DO NOT TRY TO DO IT YOURSELF.

Food- Wash your canned goods in detergent and water. Do the same for food in jars. If labels come off, be sure you mark the contents on the can or jar with a grease pencil. Do not use canned goods when cans have bulged or are dented or rusted.
To remove odor from your refrigerator or freezer, wash the inside with a solution of baking soda and water, or use one cup of vinegar or household ammonia to one gallon of water. Some baking soda in an open container, or a piece of charcoal can be placed in the refrigerator or freezer to absorb odor.

Flooring and Rugs- When water gets underneath linoleum, it can cause odors and warp the wood floor. If this happens, remove the entire sheet. If the linoleum is brittle, a heat lamp will soften it so it can be rolled up without breaking. If carefully removed, it can be re-cemented after the floor has completely dried. Small blisters in linoleum can be punctured with a nail and re-cemented if you are careful. Dilute regular linoleum paste thin enough to go through a hand syringe and shoot adhesive through the nail hole. Weigh down the linoleum with bricks or boards. It usually is possible to cement loose tiles of any type. Wait until the floor is completely dry before beginning.

Locks and Hinges- Locks (especially iron locks) should be taken apart, wiped with kerosene and oiled. If locks cannot be removed, squirt machine oil through a bolt opening or keyhole, and work the knob to distribute the oil. Hinges also should be thoroughly cleaned and oiled.

Walls and Furniture- To remove soot and smoke from walls, furniture and floors, mix together:
4 to 6 tbsp. Tri-Sodium Phosphate1 cup Lysol or any chloride bleach1 gallon warm water.
Wear rubber gloves when cleaning. After washing the article, rinse with clear warm water and dry thoroughly.

Walls may be washed down while wet. Use a mild soap or detergent. Wash a small area at one time, working from the floor up. Then rinse the wall with clear water immediately.

Ceilings should be washed last. Do not repaint until the walls and ceilings are completely dry.

Do not dry your furniture in the sun. The wood will warp and twist out of shape. Clear off the mud and dirt by scrubbing with a stiff brush and a cleaning solution. You can also rub the wood surface with a 4/0 steel wool pad dipped in liquid polishing wax, wipe with a soft cloth and then buff. Remove the drawers and let them dry thoroughly so there will be no sticking when you replace them.

Wet wood can decay and mold, so allow it to dry thoroughly. Open doors and windows for good ventilation. Turn on your furnace or air conditioner, if necessary. If mold forms, wipe the wood with a cloth soaked in a mixture of borax dissolved in hot water. To remove white spots or film, rub the wood surface with a cloth soaked in a solution of a half cup of household ammonia and a half cup of water. Wipe dry and polish with wax, or rub the surface with a cloth soaked in a solution of a half cup turpentine and a half cup of linseed oil. Be careful because turpentine is combustible.

Suggestions courtesy of: http://www.handymanmatters.com/Gus Ruiz Handyman Matters, 22982 La Cadena, Laguna Hills, CA 92653.

The California Fires

As a resident of Southern California I am very much saddened to see so much destruction of our beautiful state. For those of you back east and wondering just how large an area this could be, just imagine driving from West Virginia up to New York State. It’s all total about 175 miles one way. How many east coast states is that, about 6. As a friend of mine currently in one of the affected areas reminded us all, ‘this is a real doozy for us this time. It kind of has the few earthquakes beat for now.’

Here is an email and pictures another friend sent to several of us last evening:

Subject: Thank you
For all of your E-mails regarding our home and family during the fire. We did evacuate, because of the 30-40 feet flames at the end of the cul-de-sac, which was 4 houses from us. We are back in our home and sweeping up ash. We didn't have any damage, thanks to some amazing firemen and helpful neighbors. I thought I would pass along some pictures. One is right across the street from our home - and the other is at the end of our street.

One of the sad developments of the Santiago Fire (other than the fact it appears to be arson) is that Whiting Ranch Wildlife Preserve has been almost completely destroyed. It was really sad to see all of those wild animals running out of the park ahead of the fires.

Until today - there had been no loss of homes. This fire is now responsible for at least 3 homes being leveled in Modjeska Ranch and possibly others in Santiago Canyon and Portola Hills.

I'm wondering if there is anything we can do for the San Diego Junior League? I heard tonight that 950,000 people have been evacuated from their homes - 500K of them in San Diego. Perspective - this evacuation is the largest peace time movement of American citizens since the Civil War.

Thanks again for your kind notes - I really appreciate it! I'm so thankful for the friendships I've found in the Junior League - you all are amazing women! Now, let's raise some money!! :)

Sandie

Sandra Thompson, PhDShareholder
USPTO Reg. No.: 46,264BuchalterNemer, A Professional Corporation18400 Von Karman Avenue, Suite 800 Irvine, CA 92612-0514 Direct Dial: (949) 224-6282 Cell Phone: (949) 702-4448 Direct Fax: (949) 224-6203 Switchboard: (949) 760-1121Email: sthompson@buchalter.com www.buchalter.com

Thank you Sandie for the pictures and allowing me to share your thoughts here. I have left her other work info for those of you needing patent work done.

We are a state of many natural beautiful resources, including our resilient people and would love to share it all with you when you come to visit or relocate here in usually sunny Southern California.

Foreclosure Risk Rising, But Only in Key Areas

Daily Real Estate News October 19, 2007

The risk of foreclosure continues to climb, but it is concentrated in regions of the country with a souring economy or in areas where many homes were financed with subprime mortgages, according to a First American CoreLogic report.The Core Mortgage Risk Index rose 1.6 percent form the third quarter, which is a slower rate of growth than earlier this year, says Mark Fleming, chief economist.Fleming says the findings show that the brunt of the anticipated rise in foreclosures won’t be felt nationwide. The burden will fall on areas where local economies are struggling because of lay-offs, Fleming said.It doesn’t matter to a home owner in Detroit — the riskiest mortgage market — whether he has a burdensome adjustable-rate mortgage or a more manageable fixed-rate loan if he no longer has a paycheck, Fleming says.In contrast, rising foreclosures in California and Florida reflect a correction in home prices, Fleming says.Overall, fewer than 2 percent of mortgage borrowers are at risk of foreclosure. In much of the rest of the United States home prices are stable, rising at about the rate of inflation. "As long as people have jobs there is little risk of delinquency and ultimate foreclosure," Fleming says.

Source: Reuters News, Jim Christie (10/18/07)

Creating A House Rules Policy for Your Tenant

This story was printed from CompleteLandlord.com,
located at file:///C:/Documents%20and%20Settings/herjoy2/My%20Documents/real%20estate/blog%20info/to%20be%20used/creating%20a%20house%20rules%20policy%20for%20your%20tenant.htm
--------------------------------------------------------------
One important addendum to any lease or rental agreement is a House Rules or Tenant Behavior Policy. Landlords create House Rules so tenants will understand what behavior is expected of them on a day-to-day basis. Present the House Rules along with the lease or rental agreement, and ask your tenants to sign a copy acknowledging they understand your expectations in regard to parties, quiet hours, parking, garbage, pets, painting or repairs.
You can include any of the following House Rules in your lease or rental agreement:
Tenants may not store trash in hallways, on decks or porches.
Tenants should use hallways for entry and exit to their apartments only.
Tenants should use only non-glass containers near the pool (if you have one).
Tenants should not cook or use barbecue grills on balconies or patios.
Tenants should not behave in a loud or obnoxious fashion, especially after dusk and before dawn.
Tenants may not disturb or threaten other tenants or their guests.
Tenants may not own or show a weapon in any common area.
Tenants may not change or otherwise tamper with any electrical connections including cable wiring.
Tenants may not use windows for exit or entry to their own or another tenant’s apartment.
Tenants may not use, buy or sell drugs or other illegal substances in the rental property.
Tenants may not heat an apartment with a portable cooking stove or portable unit heater.
Tenants may not store any gas appliances in closets.
Tenants may not change the locks or paint without permission from the landlord.
Other recent Property Management tips for landlords:

Bounced Checks
The Roommate Trap with Late and Partial Payments

Know the Law, Know the Law, Know the Law

by Robert L. Cain, Copyright 2007 Cain Publications, Inc.

One property manager I knew told the story about the time she was talking to a landlord about her rental property and said "the law says. . ."

The landlord replied aghast, "There are laws!!!?"

Yes, ma'am, there are laws. And in most states those laws were written to protect the "poor, abused, downtrodden" bad tenant. Also in most states there are too many judges who take it a step farther and interpret the laws and rule in ways that provide bad tenants even more rights to not pay the rent and trash property.

Shame on the legislatures and shame on the judges, but that is the situation we face when we own and manage rental property.

Rental property is one of the most regulated industries in the country. It is filled with traps, pitfalls and snares awaiting the unwary landlord. The rental property business is one of the easiest to get into, as well. All you have to do is buy house,tidy it up a little, find a tenant, and rent it out.

Then the fun begins for the bad tenant when the landlord he or she rents from is totally unaware of the landlord-tenant law of the state. Landlords enter without proper notice, harass tenants when the rent is late, apply the apartment complex's rules unfairly,select tenants in violation of the Fair Housing Act, and handle security deposits improperly.

Bad tenants often know the law. They know the law because they have had experience using it and have probably sued a landlord or two over the course of their bad-tenanthood pillaging and devastation. Again and again they catch landlords who are unaware that laws govern our business. They lurk behind moldy tall grass and under rocks waiting for their landlords to violate the law ever so slightly, and then they slither out to try to get a judge to let them live rent free for months and months.

The landlord-tenant laws of most states are easily obtain able either online from the Rental Property Reporter website, online from your state's secretary of state, or from your local apartment, landlord or rental owners association. Having them on your bookshelf is one thing, but actually taking the time to read them and understand them is another.

Whenever I travel to another state to speak, I always print out that state's landlord-tenant act and read it. The first thing I look at are notice requirements, that is, how much time a landlord has to give to terminate a tenancy, change the terms of the rental agreement, allow after the rent is due before filing an eviction, and before he or she can enter a tenant's home for inspection or repair.

Next I want to know the security deposit requirement. Is there a limit on how much a landlord can collect? Does the deposit have to be placed in a special bank account? What are the requirements for accounting for it when a tenant moves out?

In most states' landlord-tenant laws, you can expect to see similar rights and responsibilities for both landlords and tenants. The real differences lie in entrance, notification and security deposit requirements. Those are the ones that will get you in trouble if you violate them, and the ones that bad tenants can probably recite verbatim.

If you don't know the law, you leave yourself wide open for the scheming of bad tenants. These people will take your property,your money and your sanity. Know the law, know the law, know the law.

Robert Cain is a nationally-recognized speaker and writer on property management and real estate issues. For a free sample copy of the Rental Property Reporter or Northwest Landlord call800-654-5456 or visit the web site www.rentalprop.com

Another choice to scraping those ceilings

http://www.ronhazelton.com/howto/victorian_ceiling_tiles.htm
Install Victorian Ceiling Tiles

and now ror a little bit of the unusual.....

Daily Real Estate News September 14, 2007
Auto-Size Elevators Bring Your Car Inside Your Home

A Singapore-based developer, Hayden Properties, is building a 30-story condominium with individual elevators for cars so owners don’t have to worry about their wheels getting dinged in the garage."It's not a gimmick. I love my cars and I'm worried they might get accidentally dented in a shared car park," says Ong Chih Ching, director of Hayden Properties, who owns two Porsches and an Aston Martin. "This solves that problem and lets you look at your car all the time."Similar buildings with individual high-rise garages are being built in the United States and Dubai, but Hayden's $663 million project would be the tallest, Ong says.

Source: Reuters News (09/14/07)

Defaults Leave Condo Associations in the Lurch

Daily Real Estate News September 13, 2007

Condo associations are feeling the pain of increased delinquencies and foreclosures, which leaves them with unpaid assessments, additional legal fees and other expenses.Establishing an aggressive collections policy is the first step toward mitigating the problem, says Jim Stoller, president of The Building Group management company in Chicago. He recommends turning over any account that is 60 days late to the association’s attorney.Prompt legal intervention also will permit the association to go to court for temporary possession of the unit. It can be rented out until the debt is paid. The process takes several months and possession ends when the foreclosure occurs.Another option is to wait until the foreclosure and hope there's enough equity after the lender gets paid first. But that's risky. "Today we rarely see any surplus," says attorney David Sugar of Arnstein & Lehr in Chicago.Under certain circumstances, an association can collect up to six months of unpaid assessments from the buyer when the unit is sold for foreclosure, but the law is a new one and the process is complicated, says Sugar.

Source: Chicago Tribune, Pamela Dittmer McKuen (9/13/2007)

Reliance on Credit Cards Reflects Subprime

Daily Real Estate News August 29, 2007

FalloutThe credit card business to date seems to have escaped the growing reach of the subprime meltdown, with card delinquencies remaining flat even as defaults have skyrocketed among homeowners, but analysts at Merrill Lynch say the sector's resistance to the turmoil be weakening. "The next shoe to drop from this subprime mortgage fiasco, which has already fed into the asset-backed market, is probably going to be the credit card business," according to Merrill Lynch economist David Rosenberg.

Credit card borrowing was up 11 percent in May and June, likely because homeowners are using plastic to pay for daily expenses to free up more cash to make their mortgage payments. Moreover, while borrowers previously have tapped into mortgage equity to produce the money needed to resolve credit-card and other debt, a Goldman Sachs report notes that "cash-outs" peaked during the fourth quarter of 2005.

Source: Investor's Business Daily, Reinhardt Krause (08/27/07)

Give your credit score a makeover

now that the kids are back in school and before holidy shopping starts; AND while its still a buyer's market - yes you need to be buying NOW not waiting for prices to go lower. Nohting happens until YOU and I put pen to paper; let's make sure those clredit reports are in order.

read below to get started:

Gerri Willis explains. By Gerri Willis, CNN March 21 2007: 1:53 PM EDT NEW YORK (CNNMoney.com) --

A few moves could improve your rating and even save you some cash.

Your credit score can be the difference between getting a good home loan and getting stuck with higher monthly payments. And with lenders tightening their standards, it's even more important that you improve your credit score as much as you can. We're going to tell you how.
Most mortgage lenders look at your FICO score. What exactly does this score take into account?
Your payment history, which makes up the biggest chunk of your score, looks at how often you pay your bills on time. The amount of debt you owe is considered equally important. The amount of time you've had your credit cards and how much new credit you apply for all play a role in determining your score.

1: Pay off your debt
You want to aim for a score in the 700s to get more favorable loan terms. The national average, according to Fair Isaac, is a FICO score of 723. And the best way to improve your credit score in the short term is to pay off the high balances on your credit card - that can raise your FICO score 60 to 70 points overnight, says Craig Watts of Fair Isaac.
Credit bureaus can predict how much of a credit risk you are by how you handle credit card debt more than any other kind of debt, like student loans. That's because with installment loans, like mortgage payments, there is a predetermined amount you pay each month. With credit cards, you're in control of what debts you have.

2: Minimize your balances
Even if you pay your bills off every month, the amount you paid will be listed on your credit report. And if you spend more than 50 percent of your credit limit, that's going to negatively impact your score. In fact, you could lower your score 60 or 70 points, says Watts.
And that could make the difference between getting a good mortgage rate and a bad one. If you're within three months from applying for credit, make sure you don't charge a lot on your cards, or split the purchases between a few cards, so you keep the balances down.

3: Hang onto older cards
As we mentioned, your FICO score looks at how long you've managed your credit. So the longer you've managed your credit wisely, the better your score. If, for example, you have a card that is at least 5 or 6 years old, it's not a good idea to close those accounts.
At the same time, opening any new lines of credit - whether it's a retail credit card or a new car loan - will almost certainly lower your score by a few points.

4: Don't sweat the little things
We've already told you what impacts your score. But here are some things that don't matter to your score at all. Your score won't be affected if you request your own credit record, or if you go for credit counseling.

It also won't impact your credit score if your employer or other lenders look at your credit score and try to solicit your business.

Current State of Mortgage Financing...What's Going On?

courtesy of: Ryan Hart Mortgage Broker

Veranda Financial Corporation 92 Argonaut Ste 215 Aliso Viejo, CA 92656 Ph) 949-716-4081 Fax) 949-313-0960 Ryan@VerandaFinancial.com

Anyone watching or reading the financial news over the last few weeks has seen a lot of angst and consternation over the state of the mortgage industry. In fact, one of the larger lenders in the US, American Home Mortgage, was forced to shut down operations recently. But why? What is happening, what does all this mean to you and most importantly... what should you be doing do right now to make sure you are protected?

Here's the scoop. Over the past several years, many loans were made to homeowners with somewhat non-traditional or "non-conforming" situations, be it a poor credit history, inability to document income, or any number of factors that do not fit within the traditional "box" for home loans. These loans are often called "Sub-Prime", or "Alt-A", meaning that they were somewhat riskier in nature than A credit, prime, or traditional loans. Another type of "non-conforming" home loan is one where the credit and income might be perfectly fine, but the loan amount is higher than $417K, which is the current maximum loan that can be done using pools of money from mortgage giants Fannie Mae (FNMA) and Freddie Mac (FHLMC). If the loan amount is higher, it can certainly be done - it's called a "jumbo loan" - but the end money comes from private institutions, not from the large government sponsored entities of Fannie and Freddie.

Most non-conforming loan product rates popped significantly higher recently. Here's what happened… The end investor for Subprime or Alt-A loans will charge a premium for taking on a pool of these loans, because they know that traditionally, they might have a higher rate of default and delinquent payments within that risky pool. But lately, default and foreclosure has been on the rise - partly due to the fact that with credit tightening and a soft real estate market, many troubled homeowners are unable to refinance or sell in order to get out of trouble. So now, these end institutions are demanding a much higher "risk premium" for taking on these pools of loans, as they see the rates of default are climbing higher. But since these institutions are purchasing these pools of loans sometimes months after the borrower has actually closed at a given rate, this increase to the risk premium means that instead of paying $101K for a $100K loan that will bear interest, they may only be willing to pay $95K for that $100K mortgage to account for the risk. Multiply that times thousands upon thousands of loans...and you have millions upon millions of dollars in loss for the company trying to sell the pool at a much lower price than they were expecting. This is called a "liquidity crisis", and is exactly what happened to American Home Mortgage - there was no mismanagement, but they simply got caught holding too many "hot potato" loans, forced to sell them at massive losses...and eventually they had to make the decision to close the doors and stop the bleeding.

In response to seeing this situation play out in the demise of American Home Mortgage, lenders of other non-conforming loan products increased their interest rates dramatically almost overnight to be better prepared - and likely over-prepared - for increased risk premiums down the road. Even though loans above $417K are not presently suffering from increased delinquencies like the Subprime and Alt-A loans are, these rates popped higher as well, because they are being purchased by smaller private entities that can't afford to take on any margin of risk.

What happens next? The major damage is probably already done, and the present situation will likely settle out over the coming year. Lenders will stop pulling products off the shelf, and the rates on products that have moved so significantly higher now should trend lower down the road as delinquency rates stabilize.

But here are a few important things YOU should do right now:

ONE: Even if you are not presently in the market for a home loan of any type, make sure that your credit standing is as solid as possible. Many people in the market for a home loan didn't expect they would have a need, and didn't plan in advance to ensure their credit would qualify them for the best possible financing. With no immediate need for a home loan, time is on your side... why don't we take a few minutes together and just make sure you are prepared, should a need arise down the road? Call or email me to discuss your options.
TWO: If you are in the market for a home loan, or know someone who is - understand that now is the time to be working with a real qualified professional who can keep you informed of changes in the market and get your loan funded quickly. Now is NOT the time to be playing the risky game of trying to scour the entire nation to find someone who promises to save you a paltry amount on costs, or deliver a rate that seems too good to be true.

Your home and your financing are just too important, and times have changed. I am here to help and advise during these volatile times - and would welcome calls from you, your friends, family, neighbors or coworkers.

Your satisfaction and referrals are the cornerstones of my business.
Ryan Hart
Mortgage Broker
Veranda Financial Corporation
92 Argonaut Ste 215
Aliso Viejo, CA 92656
Ph) 949-716-4081
Fax) 949-313-0960
Ryan@VerandaFinancial.com

Should You Borrow From Your 401k?

Have you refinanced your home into oblivion? Tapped out every available money resource with a myriad of loans and credit cards? There is one last option: borrowing from your 401(k). If you've never heard of this option, it's because until recently, it just wasn't done that frequently. But with the market still not fully recovered, and people desiring to cut their high interest debt, more folks are discovering this alternative lending source.

Before you go off half-cocked, it is crucial that you understand the pros and cons. Don't forget that your 401(k) is your retirement nest egg, and you are putting that nest egg into possible jeopardy. If you're thinking of borrowing from your 401(k) to buy a luxury automobile or a larger home, stop. Mortgaging your future to live a lifestyle that's beyond your income, while it's become the American Way, is a mistake. But if you're trying to get out from under high-interest debt and plan to use this opportunity to live within your income, it could be your ticket to becoming debt-free.

Here's how they work: most plans allow you to borrow up to half of your vested balance, but not more than $50,000. You apply to the company that manages your 401(k) plan, but you don't have to "qualify"-after all, you're borrowing money from yourself. You sign a promissory note and receive the money within a couple of weeks. The interest rate is usually equal to the prime rate or slightly over, so currently you'd pay 3-4 percent interest. You then have five years to repay the loan, and most of the time, you make payments through payroll deductions.

Now let's look at the pros and cons of borrowing from your 401(k):
Pros:

A 401(k) loan does not appear on your credit report. They are not reported to
Experian, and do not become a part of your credit history.
The interest
on
these loans is some of the lowest out there-right now, 3-4 percent.
You're
paying yourself the interest, not some bank.
You'll get your
money more
quickly than if you were using another means of borrowing.
Since it's a
loan, you will not be charged the 10 percent early
withdrawal penalties plus
income taxes you would have to pay if you withdrew
the money.
You don't have
to qualify for the loan through the usual
long, painful credit approval process,
because in effect, you are the
lender.
No assets or collateral are needed to
secure the loan.

Cons:

The biggest con is that you are forfeiting the accrued interest you would earn
if your money stayed in the 401(k). Calculated over the long term, it can cost
tens (even hundreds) of thousands of dollars in potential gain.
Unlike a
home equity loan, the interest is not tax deductible.
Some plans do not
allow contributions to the 401(k) for the period of the loan.
If you lose or
quit your job, the loan is often due in full in 30-60 days (although some plans
are open to renegotiating the terms of the loan. Find out before you sign the
papers.)
If you default on the loan, it is considered a withdrawal and you
will owe a 10 percent penalty plus a hefty tax payment. So if you had borrowed
$50,000 and couldn't pay it back, you would have to pay a $5,000 penalty and
federal and state taxes that could take another $20,000 of the amount.

To calculate the actual cost of borrowing from either source: for a home equity loan, ignoring upfront costs, the after-tax cost is the interest rate minus your tax savings (interest rate times 1 minus your tax rate).
The cost of borrowing from your 401(k) is what your loan would have earned had you kept the money in the 401(k). Since your 401(k) accumulates tax free, the total return on the fund is a close approximation of the after-tax cost.

Let's say you need to borrow $10,000 and you have $100,000 in your 401(k) earning an average of 10 percent a year. Interest on a home equity loan is 8.5 percent and you are in the 28 percent tax bracket. The after-tax cost of the home equity loan is 8.5x(1 - .28) or 6.12 percent. The 10 percent cost of borrowing from the 401(k) is higher than the 6.12 percent cost of the home equity loan.

If both loans are repaid in full after one year: if you use a home equity loan, you will have $110,000 in your 401(k), you've paid the lender $10,850 in interest and you have a tax savings of $238. Your financial wealth will therefore be $110,000 - $10,850 +$238 = $99,388.
If you borrow from the 401(k), you will have only $99,000 in your 401(k) at the end of the year because you haven't earned the 10 percent on the $10,000 you borrowed. Whatever you pay back to the fund does not affect your wealth. You are thus $388 poorer if you borrow from your 401(k).

How to Retain Good Tenants

courtesy of: Brendan O’Brien; Property Master Software; 1-888-820-7767 x300 He is a contributing writer to REIP The Rewards® Magazine and is an active landlord and real estate investor. For more information about Property Master Web™ visit www.PCPropertyMaster.com or email brendan.obrien@pcpropertymaster.com .

Good tenants are easy to ignore – until they tell you they are moving out. Why are they leaving? Well, it might be because you ignored them. And when tenants plan to move, it’s very, very difficult to get them to change their minds.

The reason you may ignore good tenants is that you spend so much time working on your not-so-good ones; cajoling them to clean up their acts or planning to evict them. When you are always on the phone with Average or Bad tenants A, B, and C, you quickly start thinking of Good tenant D as simply a check that comes in the mail, on time every month, like clockwork. But your good tenants are much more than that. They are human beings who:

Understand that they are paying good money, and expect good service in return
Notice when their building seems to be going downhill
Recognize when they are being BSed or treated disrespectfully or dismissively

On the other hand, YOU may not recognize these feelings in your good tenants, simply because they may be reluctant to share them. The complaints are more likely to come from your poorer tenants, and you may be more likely to dismiss them as a result. The good tenants are more likely to suffer in silence, before deciding to move on.

It’s vitally important that you retain your good tenants, not only because they make your landlording more pleasant, but because they are so hard to replace. Once that unit is vacant, you may not re-rent it for months, and you have no idea how the next tenant will turn out. He could be just bad enough to make your life really difficult, or so bad that he only lasts for a month or two before eviction.

Since your good tenants are less likely to contact you, you have to stay in touch with them. Try to get a read on their feelings by calling or emailing at least once a month. Here’s a short checklist of questions:

Does anything need repairs in the unit?
Are you noticing any maintenance issues in common areas?
Do you have any suggestions for me?
How are your neighbors?

Not only have you learned how satisfied your good tenants feel, you’ve made them feel important and wanted. Now you need to follow up by addressing their concerns, if any, sincerely and quickly. Bear in mind as you do so that you can’t get into trouble for being nicer to your good tenants than your bad ones. If a good tenant’s got a maintenance issue, generally make it your first priority – the only more important issues will relate to safety or potential for very serious problems, such as fire or water damage hazards. If a good tenant’s got a beef with a neighbor, get all the facts and deal with it right away – making sure you get the neighbor’s side of the story before making a judgment. If a good tenant and a bad tenant are having a dispute, and neither is clearly in the right, it’s okay to side with the good tenant.

While you’re at it, ask your good tenants if they’re thinking about moving. Yes, that’s shockingly blunt. But it’s the only way you’ll ever find out if a tenant is planning to move before he or she actually signs a lease for another unit. Once they sign that lease, they’re gone – and no amount of cajoling is going to get them back.

If a tenant IS planning to move, ask why and press (nicely!) until you get an answer. Hopefully their decision will be based on a problem you can fix. The unit feels kind of old and grimy? Offer to repaint it. It’s too hot in the summer? Get them an air conditioner. It’s too small? Maybe you have a larger unit vacant, even if it’s in another building – and you’ll help them move for free.

Some of these fixes run into some serious money. You need to compare them to the cost of finding a new tenant. That is a certain amount of lost income, plus the cost of marketing the unit, plus any necessary renovations to make it re-rentable. If the unit needs paint anyway, then painting it to motivate a good tenant to stay is much better than painting to get a new tenant. If the money looks REALLY serious, ask them to sign a new lease. Point out that they would have to if they moved to a different building anyway.

You should also make sure your tenant recognizes the cost and aggravation of moving. They’ll have to rent a truck, buy or steal boxes, pack everything, arrange for new utilities, physically transport the stuff, and change addresses for all of their mail. Why should they do all that when you can offer them what they want with much less hassle?

On the other hand, they might be moving for reasons you can’t control, maybe because they’re getting married or taking a new job in a different city or buying a house. Thank the tenant for being a great tenant, and ask if they know anyone else who might be interested in renting the unit.
You have to be committed to keeping your good tenants happy. That doesn’t include letting them break rules or pay rent late. Instead, look for little things you can do to be helpful. For example, when tenants move out, they often leave behind one or two objects of some value; bookshelves, portable fans, and so on. I offer these to my remaining good tenants. I also send Christmas cards each year with a gift card to a local coffee shop in each. It’s definitely worth $5 to make a good tenant happy.

While you’re at it, invest in a few emergency items you can have available for tenants if they need them. Get a couple of electric space heaters (for use if the heating system breaks) and big coolers (if there’s a power failure). Now if you get a call about a heating problem or power failure, you can offer some quick relief until the issue is resolved.

Brendan O’Brien is the founder and president of Property Master Software.

Our landlord software runs from any Internet-connected computer, includes FREE customer support and training, full accounting and reports, and property evaluation tools, and works with your other programs to help you manage anywhere from 1 to 100,000 rental units.

child safety and the internet

indulge me a smidge. since your children are always on the internet, i just wanted to remind you that their safety should still be considered. here is a newsletter i get monthly.


Vol. 3 No. 7 July 2007
Your Guide to Monthly PC Protection

This Month: The Good, the Bad and the Unimaginable: Your Children and the Internet Concerned the Internet is Impacting Your Child's Health? You're Not Alone Insider's Edge


Feature Story:The Good, the Bad and the Unimaginable: Your Children and the InternetIt's true that the Internet can be a wonderful resource for your children to complete homework assignments, socialize with friends and find entertainment. It's also true that the Internet has proved to be an outlet for foul-minded people to carry out their thoughts against children. Without proper restraints, it's possible for innocent-minded youth to accidentally visit offensive websites, be victimized by a cyber bully or encounter online predators. There are two things that parents can do to bring them peace of mind when their children are using the Internet. First, parents should set rules for Internet use. Second, parents should use parental control software to help enforce those rules.[read more >]Family Safety Concerned the Internet is Impacting Your Child's Health? You're Not AloneIf you're worried about how the Internet impacts your children's health, you're not alone. According to a recent study1, Internet Safety ranks number 7 on the top 10 list of child health concerns. Internet safety is a relatively new concern for parents, but it's not one to be taken lightly.While smoking and drug abuse are still the top concerns, the Internet provides a different forum for your children to fall into the "wrong crowd". Children can innocently surf to an offensive website while searching for things that interest them or, perhaps even worse, get caught up in a conversation with an online predator.[read more >]1Data source: C.S. Mott Children's Hospital National Poll on Children's Health, March 2007Insider's EdgeGood parental control software offers you a variety of tools to help protect your family against inappropriate websites. The parental controls component of CA Internet Security Suite 2007 provides:A customizable filtering policy that allows you to block sites in commonly blocked categories, like Adult, Gambling, and Chat.Time restrictions so you can control when (and for how long) your child can access the Internet.Password protection to keep others in the household from modifying settings or disabling the product.Extensive reporting capabilities that allow you to view the Internet activity of those using the computer.Automatic updates to help keep your protection current against new web content that appears every day.[read more >]*Internet Protection Plan is only available to U.S. customers. Identity Theft Protection is not available to residents of New York and may not be available in other jurisdictions. For each plan, certain eligibility requirements and restrictions apply. Visit ca.com and www.mobilelifeline.com for details.

You’ve heard of a reverse mortgage, Right? for those of us under 75, Here is somethingn a little different.

You’ve heard of a reverse mortgage? Well now, there is a company that is offering something similar for those of us with a life expectancy of at least 20 years or more.

I recommend using the program at your own advisement; as I do with the reverse mortgage programs. They basically take an investment % stake in your home. Neither payments nor interest is paid on the money while you are involved with them. The program offers to “loan” you money on the future equity of your home’s sales price. For this, they get a percentage of the increased equity difference. If the house loses value at the time of sale then they also share in the perceived loss of value.

What I would use this type of Investment Loan for: Exactly That. An investment that I figured was going to garner more than the “loan” was going to cost me and also allow me to increase my investment portfolio in proportion to a great amount than the use of their money was going to garner. NOT to pay bills, not to purchase a non-performing asset (car, clothes, tuition, short term loan or take a trip). Remember that there will be a sale date certain attached to the investment monies advanced. For more information and to actually talk to a representative from accompany offering such “loans” click on the following link. http://www.rex-inc.com/index.php/rex/how_it_works/

I have no affiliation, connection nor know anyone as of this review that works for the company, nor am I profiting in any way by making you aware of this other “loan” option.

Multifamily Market update for June 2007http://www.realtor.org/press_room/news_releases/2007/cremf_2007q2_sound_record_investment.html?&WT.mc_t=LS07180

For more information, contact:
Walter Molony, 202-383-1177, wmolony@realtors.org

Commercial Real Estate Sound With Record Investment
WASHINGTON, June 13, 2007 -

Multifamily Market

In many areas, buildings constructed as condos are now being turned into rental projects. The demand for apartments remains strong, but new supply is essentially matching leasing activity.In the apartment rental market – multifamily housing – vacancy rates are projected to average 5.8 percent in the fourth quarter, almost unchanged from 5.9 percent in the fourth quarter of 2006. Average rent should increase 2.1 percent in 2007, after a 4.1 percent rise last year.Multifamily net absorption is likely to total 212,300 units in 59 tracked metro areas this year, down from 229,300 in 2006.The areas with the lowest apartment vacancies include Northern New Jersey; Pittsburgh; Salt Lake City; San Jose; San Francisco and Norfolk, Va., all with vacancy rates of 2.7 percent or less.Multifamily transactions in the first four months of this year totaled $23.2 billion, down 25 percent from the same period in 2006. Essentially half of the purchases were by private investors; condo converters accounted for only 5 percent of acquisitions.

What Landlords Need to Know About Contractors' Insurance

By Scott Brueggeman, Fellow Landlord and Publisher of CompleteLandlord.com

It is time to remodel your property. You have hired a highly recommended contractor, discussed the work and agreed on a price. You have confidence in your contractor’s ability, but do you know whose insurance will kick in if someone is injured or property is damaged during the project?

• 
  To protect yourself, make sure any contract you sign includes the following:
  • Verification the contractor has a valid commercial general liability insurance policy that will be in effect when the work begins
  • Proof of insurance with sufficient coverage for the work to be done and the type of work required for your job
  • Your name and property listed as a named or additional insured on the policy
  • Confirmation the contractor’s insurance is the primary policy, not your own personal insurance
  

Request a copy of the contractor’s insurance policy and review it before work begins on your property. Check that the policy is in accordance with all the conditions in the contract you signed.

Additionally, be sure the policy is taken out under the same name as the contractor you hired. Contractors often use multiple names for business purposes, but if the name on the policy is different from the name on the contract, then you are not insured. Finally, make sure the policy provides adequate coverage.

Taking these precautions when hiring a contractor will help you rest easy while work is being done on your property.

Flipping Property: Do You Have What It Takes to Invest in Real Estate?

Flipping property is the process by which an investor buys real estate and then resells it very quickly. This process has received a bad reputation through the fraudulent practices of some investors, but, if it is done properly, it is ethical and legal. Flipping property is, in a sense, investing in property, but there are some specific aspects you should consider if you decide to try to make money from this activity.

1. Look for undervalued property
The real estate market is softening up, but it can still be difficult to find undervalued property. Quite often you can find this property by knowing if someone is selling for a specific reason, such as a divorce or death in the family. You can look through real estate listings and look for phrases like “must sell” or “motivated seller.” If you are dedicated to the flipping process, you can also run ads for home sellers who are trying to sell quickly.

2. Watch for property foreclosures
A foreclosure due to missed mortgage payments or non-payment of taxes may present an opportunity to acquire properties at a reasonable cost and flip them for a profit. You can scan the newspaper for notices of foreclosure. You can also visit several Websites such as www.hud.com , www.fannimae.com, www.freddiemac.com and http://countyrecordsresearch.com/ ( if you decide to subscribe let me know)

3. Be aware of costs
You will probably have to pay a real estate agent at least a six percent commission to sell the property. You will also have to factor in the costs of necessary repairs and improvements to the home. These improvements can be costly (such as repairing a roof, fixing a foundation or replacing a heating system). You have to factor in these costs to what you can reasonably expect to make on the property. Do not make the mistake of overdoing the renovation. The more work you can do yourself, the more you will make on the sale of the property.

4. Location, location, location
Flipping a property is another reason to evaluate the neighborhood and what possible changes it is going through. If you know a neighborhood is starting to gentrify, you have a much better chance of making money from the property.

5. Price the property to sell
Your ultimate goal in flipping property is to sell it. That means you have to offer a price that is consistent with the prices in the area and with the condition of the property. Leave your emotions out of this process, and carefully evaluate what you can reasonably expect to earn from the property.

6. It is a difficult process
You have probably seen or heard many advertisements for get-rich-quick schemes that teach you how to flip property. No matter what the ads says this is not an easy process. You need to do your research, consider the costs and plan how to sell the property. If you do everything right, you can often make money, but profit is not a certainty. You have to hold the property just long enough and sell it at exactly the right time.

7. Rely on experts
Your most valuable asset in acquiring property that can make you money is your home inspector. He or she needs to be able to judge the condition of the property and what it will take to make it attractive to potential buyers. Also use a real estate attorney to make sure your transactions are legal.

8. Take a class
You may be able to take a tutorial on flipping property by someone with established credentials in the process. This expert can help you find out how to locate property, what costs to anticipate and what price you could sell the property.

9. Find property auctions
Besides must-sell scenarios and foreclosures, you may also be able to take advantage of property auctions, usually based on the lending institution trying to sell the property as quickly as possible. Sometimes, going through the auction process will let you purchase a property for a less expensive price.

10. Try to sell quickly
You will not make money on a flipped property if you cannot sell it quickly. If a property stays on the market too long, it becomes harder and harder to sell. The longer you own it, the less you will make. Use every possible avenue to sell your property including ME your Realtor; Hermia (949) 742 - 0915, advertising, signage, and old-fashioned curb appeal.

Did You Know This About Vodka?

1. To remove a bandage painlessly, saturate the bandage with vodka. The solvent dissolves

adhesive.

2. To clean the caulking around bathtubs and showers, fill a trigger-spray bottle with vodka, spray the caulking, let set five minutes and wash clean. The alcohol in the vodka kills mold and mildew.

3. To clean your eyeglasses, simply wipe the lenses with a soft, clean cloth dampened with vodka. The alcohol in the vodka cleans the glass and kills germs.

4. Prolong the life of razors by filling a cup with vodka and letting your safety razor blade soak in the alcohol after shaving. The vodka disinfects the blade and prevents rusting.

5. Spray vodka on vomit stains, scrub with a brush, then blot dry.

6. Using a cotton ball, apply vodka to your face as an astringent to cleanse the skin and tighten pores.

7. Add a jigger of vodka to a 12-ounce bottle of shampoo. The alcohol cleanses the scalp, removes toxins from hair, and stimulates the growth of healthy hair.

8. Fill a sixteen-ounce trigger-spray bottle and spray bees or wasps to kill them.

9. Pour one-half cup vodka and one-half cup water in a Ziplock freezer bag and freeze for a slushy, refreshable ice pack for aches, pain or black eyes.

10. Fill a clean, used mayonnaise jar with freshly packed lavender flowers, fill the jar with vodka, seal the lid tightly and set in the sun for three days. Strain liquid through a coffee filter, then apply the tincture to aches and pains.

11. To relieve a fever, use a washcloth to rub vodka on your chest and back as a liniment.

12. To cure foot odor, wash your feet with vodka.

13. Vodka will disinfect and alleviate a jellyfish sting.

14. Pour vodka over an area affected with poison ivy to remove the oil from your skin.

15. Swish a shot of vodka over an aching tooth. Allow your gums to absorb some of the alcohol to numb the pain.

16. Never drink the stuff...It'll kill you!

Checking References

courtesy of : Robert Cain [ mailto:bobcain@rentalpropertyreporter.com]

The references you get from the applicant are as important as any other information you can get. There are certain references you must have.
First, and most obvious and foremost, is landlord references. Previous landlords will tell you most about what kind of tenant the applicant was. Even though many are hesitant to say anything bad about a tenant for fear of lawsuits, you can still find out an amazing amount of information simply be asking leading questions. Two questions you want to make sure you ask are "Did you know the tenant is moving?" and "Why are they moving?" or "Why did they move?"
Second, employer references can provide information about what kind of person the applicant is. You can also ask questions of the employer you might not be able to ask legally on the application, such as number of children, etc.
Third, personal references are always going to be friends or relatives of the applicant. If they are hesitant about saying something nice about your prospective tenant, you have a definite reason to suspect that the applicant will not be a good tenant. Also, check the addresses and phone numbers of the personal references to see if they are the same as any of those of the landlord references or employer references. Some bad tenants would be stupid enough to do that.
Use the phone book and/or directory assistance to verify that all the names, addresses and phone numbers on the application match -- that's for landlords, personal references, employers, etc. I cannot stress the importance of doing this too much. Professional bad tenants will have their friends pretend they are landlords and employers. If one thing doesn't match, they'd better have a good explanation. If more than one thing doesn't match, reject them.
If you want to make sure that you are talking to the real landlord, call the customer service department of a title company or the county tax assessor's office. Just give them the address of the property, they'll tell you the name and address of the owner of the property. Then make sure the name you get is the same as that of the landlord reference. Many counties' tax records are online. You can find out the owner of the tenant's previous residence by checking there and avoid having to go through voice mail hell with the county.
If the prospective tenant has just sold his house, ask for the name of the real estate agent who sold it for him. If he doesn't remember, that might make you suspicious. If he sold the property himself, ask for the name and phone number of the buyer.
When you call the real estate agent or buyer, ask about the condition of the property, the sales price, the amount of equity in the property, and anything else you think is pertinent. Ask who the lender on his home was. Call the loan officer, as well.
People who are moving from out of town are high risks (especially if they have no personal references). Find out why they are moving into the area.
You can check to see if their references' names, addresses and phone numbers match by checking with directory assistance. "I would like the phone number of Jim Johnson who lives at 1234 Elm St. in San Diego, California." And call all out of town references: the money will be well spent.
Check at the county court house for criminal record and/or eviction record. Or pay $20 or less and have a tenant screening service pull a public records report as well as a credit report for you. If they have either a felony conviction or an eviction, it could very well end up costing you big bucks to rent to them.From the book Profitable Tenant Selection available from Cain Publications, Inc. For more information on this publication, go to Profitable Tenant Selection.

How to Build a Flag Preservation Frame

Learn how to build a flag display case; details include building a stretcher frame and case along with tips, materials and tool lists.

Give your credit score a makeover

A few moves could improve your rating and even save you some cash. Gerri Willis explains.
By Gerri Willis, CNN
March 21 2007: 1:53 PM EDT
NEW YORK (CNNMoney.com) --

Your credit score can be the difference between getting a good home loan and getting stuck with higher monthly payments. And with lenders tightening their standards, it's even more important that you improve your credit score as much as you can. We're going to tell you how.
Most mortgage lenders look at your FICO score. What exactly does this score take into account?
Your payment history, which makes up the biggest chunk of your score, looks at how often you pay your bills on time. The amount of debt you owe is considered equally important. The amount of time you've had your credit cards and how much new credit you apply for all play a role in determining your score.
1: Pay off your debt
You want to aim for a score in the 700s to get more favorable loan terms. The national average, according to Fair Isaac, is a FICO score of 723. And the best way to improve your credit score in the short term is to pay off the high balances on your credit card - that can raise your FICO score 60 to 70 points overnight, says Craig Watts of Fair Isaac.
Credit bureaus can predict how much of a credit risk you are by how you handle credit card debt more than any other kind of debt, like student loans. That's because with installment loans, like mortgage payments, there is a predetermined amount you pay each month. With credit cards, you're in control of what debts you have.
2: Minimize your balances
Even if you pay your bills off every month, the amount you paid will be listed on your credit report. And if you spend more than 50 percent of your credit limit, that's going to negatively impact your score. In fact, you could lower your score 60 or 70 points, says Watts.
And that could make the difference between getting a good mortgage rate and a bad one. If you're within three months from applying for credit, make sure you don't charge a lot on your cards, or split the purchases between a few cards, so you keep the balances down.
3: Hang onto older cards
As we mentioned, your FICO score looks at how long you've managed your credit. So the longer you've managed your credit wisely, the better your score. If, for example, you have a card that is at least 5 or 6 years old, it's not a good idea to close those accounts.
At the same time, opening any new lines of credit - whether it's a retail credit card or a new car loan - will almost certainly lower your score by a few points.
4: Don't sweat the little things
We've already told you what impacts your score. But here are some things that don't matter to your score at all. Your score won't be affected if you request your own credit record, or if you go for credit counseling.
It also won't impact your credit score if your employer or other lenders look at your credit score and try to solicit your business.

Field Guide toEscrow Accounts/Earnest Money

Field Guide toEscrow Accounts/Earnest MoneyBy Kerrie Bartlett Walsh, Senior Marketing Specialist



C O N T E N T S
Escrow AccountsEscrow AdministrationEarnest Money DepositsEscrow Fraud and Real EstateCase Summaries - Escrow MishandlingBooks, eBooks & Other Resources


Escrow accounts are funds that a lender collects to pay the monthly mortgage insurance premiums, homeowners insurance policy premiums and yearly property taxes. Earnest money, on the other hand, is a good faith sum of money given to bind a contract, for example an agreement to purchase real property or a commitment fee to assure an advance of funds by a lender. This field guide will provide you with details on escrow accounts (from the basics to escrow administration) and earnest money as well as information on escrow fraud. You'll also uncover a variety of case summaries on escrow mishandling, in addition to the numerous digital resources available from the Library's eBooks collection.
WHAT'S THE PASSWORD?
- Articles marked with a red Q are provided by ProQuest for NAR members only. Please enter NAR's Proquest password if required.
- Articles marked with the REALTOR® "R" are available on Realtor.org. Your Realtor.org ID and password may be required.


Escrow AccountsHow the term escrow relates to your real estate transaction, (About.com, 2007).Escrow account - everything you need to know, (Mortgage-x.com, 2007).The new word in home sales - "cancelled" - buyers back out of deals in record numbers, a $30,000 deposit lost, (The Wall Street Journal, Nov. 3, 2006). FAQs about escrow accounts for consumers, (U.S. Department of Housing and Urban Development, June 20, 2005).Do it yourself, (Kiplingers, Mar. 2003). How to keep escrow shocks to a minimum, (Money, June 1998). Escrow AdministrationEscrow and trust record keeping - 10 tips for safer escrow accounts, (REALTOR® Magazine Creating and Monitoring Business Systems Toolkit, 2007). 6 musts for escrow and trust record keeping, (REALTOR® Magazine Creating and Monitoring Business Systems Toolkit, 2007). Post-contract pitfalls, (www.realtor.org, Mar. 24, 2006).

Know Your Client's Rights - Six Must-Know Escrow Facts
Escrow instructions should specify in writing how and under what conditions monies will be disbursed, especially if the transaction doesn't close.Escrow is a fiduciary relationship but is limited to the duties involved in the escrow. The escrow agent is a trustee of both parties and is equally responsible to both parties for the administration of the escrow. If a transaction fails to close as scheduled, monies may continue to be held in escrow provided there is no written demand from one party to cancel the contract. Monies are typically held after the closing date if a date to obtain the loan has passed but the parties still want to proceed with the transaction.If the transaction is cancelled by either party, the agent holding the escrow monies shouldn't disburse any funds until all parties agree in writing how to disburse them.If parties can't agree on how to disburse funds, the escrow agent may file an interpleader, which names all the parties that might have an interest in the monies and asks a court to decide how to disburse the money. Otherwise, an escrow agent may be obligated to keep funds indefinitely.If a transaction is cancelled by the parties, real estate brokers and other third-party vendors may have first claim to escrow funds. That claim would depend on procuring cause.Source: The list issue: legal - 6 must-know escrow facts, (REALTOR® Magazine, March 2005).


Earnest Money DepositsThe earnest money deposit, (RealEstateABC.com, 2007).Earnest money deposits - protect your good faith deposit, (About.com, 2007).Questions and answers on earnest money deposits, (North Carolina Real Estate Commission, 2007).First-house buys can knock you off your foundation, (Washington Business Journal, Apr. 21, 2006).


Escrow Fraud and Real EstateMortgage scams: real estate closing fees kickback scams, (www.fraudguides.com, 2007).Growing ownership makes Hispanics target for predatory lending, (The Business Journal of the Greater Triad Area, Oct. 20, 2006).Title companies investigated, again, (Realty Times, Mar. 1, 2005).Don't be a victim of loan fraud, (U. S. Department of Housing and Urban Development, Aug. 18, 2

Real Estate Sky Won't Fall: Here's Why

Realty Times Jun 07, 2007, 12:07 pm PDT

Real estate hasn't made much of a case for itself lately and it's not getting much help from any of the sub industries, such as builders and mortgage makers. Just in the past few weeks, so called experts from the mortgage industry, the building industry, and the resale real estate industry have all been quoted as saying that the sky is falling.

Nice job guys!

And while real estate's reputation as the number one investment is on the ropes, the general media and other investment categories have stepped up their attacks on real estate value.

What do you need to know?

1. The Sky isn't falling.

The real estate market always fluctuates.

Real estate sales prices are largely determined by the principal of substitution and reflect the uniqueness of the property, at a specific point in time, competing against only those other similar properties that happen to be available for sale, at that point in time.

If there are many similar homes available at that time, there will be downward pressure on sales prices. As an expanding population absorbs the excess, competition for a dwindling resource will cause selling prices to escalate.

2. Real estate is unique.

There's a reason that homes and real estate aren't traded like commodities on the Chicago Mercantile. They are too dissimilar. Even each tract home has a somewhat different location, orientation, lot dimension, proximity, and view.

3. There is no bubble.

The value of real estate isn't driven by speculation; it's driven by its utility. If the economy moves away, such as in the rust-belt, that utility may decline. If high paying jobs are headed into a region, the value of the scarcest of all commodities, real estate will rise.

Increasing development costs absolutely guarantee that new construction will cost more than existing properties are selling for.

This factor alone has caused many developers to mothball projects in the pipeline until shortages again push prices up.

4. Value is a complicated cocktail.

Assessed value, appraised value, market value, replacement value, and selling price all mean something different. When the media says that real estate values are falling, they really mean that the prices people paid for a small number of homes, last month, was less than what a different group of people paid for a different assortment the month before.

5. There is always a baseline of demand.

An increasing population must be housed. There is a natural ebb and flow, not a boom bust. At various times, demand outstrips supply; supply is increased until the surge recedes to baseline or below.

6. There is always a baseline of mortgage defaults.

There will always be unforeseen circumstances that will bring some homeowners into default. Even in good economic times. And even with good mortgage loans. In an appreciating market, they are able to sell in a short period of time. So, in most markets, foreclosure activity has been below the historic baseline.

Now, it could increase, spiking a little to reflect those who can no longer survive on increasing equity and then may level out at baseline again. When the next rapid appreciation cycle begins, and it almost assuredly will, rates may fall back below the newly adjusted baseline.

7. There is no risk.

Save the term risk for high stakes poker in Vegas.

Buying real estate isn't inherently risky. But it isn't a get-rich-quick scheme, either. It's a formula for building long term wealth.

8. Real estate is a great way to build wealth.

You have to live somewhere. If you rent, you are making some or all of someone else's mortgage payment. But even if you have to work two jobs and barely scrape by to make your own mortgage payment, you are building equity that over time will be quite substantial.

So, perhaps, don't believe every "the sky if falling" report or article. Educate yourself on the market and happy wealth home owning!