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| MY AUGUST 2010 Newsletter |
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CABRILLO ESTATES (PENDING SALE Check out virtual tour. Remodeled 3 bed/2 bath Family Room w/large yard.. Must see! Reduced to $669k http://www.visualtour.com/applets/flashviewer2/viewer.asp?t=2037864&sk=30 |
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Single Level w/Views(Los Osos) Great 3 Bedroom/2 bath w/Views of Ocean/Rock & Holister Peak..Approx 1700 Sqft for only $425,000 http://ccrmls.rapmls.com/scripts/mgrqispi.dll?APPNAME=Centralcoast&PRGNAME=MLSLogin&ARGUMENT=Bpd%2FijqrDRgzfLnx88ywDI3zEsYeF2vq5ICdLlPAxpc%3D&KeyRid=1 |
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Remodeled Morro Bay Home 2/or 3 Bedroom Home with great yard for entertaining, with Built-in BBQ abd spa..$539,000 http://ccrmls.rapmls.com/scripts/mgrqispi.dll?APPNAME=Centralcoast&PRGNAME=MLSLogin&ARGUMENT=Bpd%2FijqrDRgzfLnx88ywDL4JKVuMOayS3erZzvAFaog%3D&KeyRid=1 |
| Ocean/Dunes View(Arroyo Grande Great Manufactured 2bed/2 bath. Bright &Open Floor Plan. new storage shed,extra long driveway $259k http://ccrmls.rapmls.com/scripts/mgrqispi.dll?APPNAME=Centralcoast&PRGNAME=MLSLogin&ARGUMENT=Bpd%2FijqrDRgzfLnx88ywDMv7PRQbZqCAL%2BBg1G4HLJY%3D&KeyRid=1 |
Articles and Advice |
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| Rate-lock dos and don'ts By Dian Hymer Interest rates dropped at the end of last year after creeping up over the summer, with 30-year fixed-rate mortgages with interest rates below 5 percent readily available. Mortgage interest rates change as often as two to three times in one day. Securing the lowest rate possible is every borrower's goal. However, it's impossible to time the finance market, just as it's impossible to predict exactly when the housing market will peak or slide. In this low-interest-rate environment, many buyers are locking in a rate, either when they submit their loan application and purchase contract, or some time before closing. A lock-in is a commitment from the lender to hold an interest rate for a period of time. Points (the lenders original fees) can also be locked. The length of the rate lock varies from seven days to 60 days and possibly longer. However, it's more expensive for a longer lock -- about 1/8 percent to 1/4 percent in rate or points for each additional 15 days. Today, it's wise to lock in your rate for 45 days if you lock when you submit your package. With delays due to appraisal issues and lenders asking for additional documentation, it can take this long to close the loan. There are advantages and disadvantages to locking in a rate. If rates fall after you lock, the lender probably won't give you the lower rate. If rates rise after you lock, the lender should honor the locked rate as long as you close on time. Some lenders offer a "float down." This would come into play if interest rates were to drop between the lock data and the date your loan documents are drawn. The lender probably won't let your locked rate float down to market rate, but to something in between. A float down is a one-time-only option. HOUSE HUNTING TIP: Because rate locks have an expiration date, it's essential to provide as much financial documentation needed to qualify you for the mortgage as soon as possible. This will speed up the approval process. Lenders require much more personal financial information than they did several years ago. Ask your loan agent or mortgage broker at the time you submit your loan application what personal financial data the lender will require -- like pay stubs and information supporting your cash downpayment and cash reserves (in bank accounts, IRAs and 401(k)s. If you're self-employed, you'll need to provide tax returns for the last two years. After your loan package is submitted to underwriting for approval, there could be other conditions that must be met. If you drag your feet producing additional documentation, this could delay approval and jeopardize your rate lock. Extensions of rate locks are sometimes granted, but don't count on it. If the delay is due to a slowdown in the lender's processing, the lender might agree to an extension, especially if interest rates haven't changed much. But, if the delay is due to your failure to provide the materials necessary to qualify you for the loan, don't expect a sympathetic ear. Try to get the lender's rate-lock commitment in writing. Some lenders will do so, but many give only verbal agreements, which are hard to enforce. Lenders often give processing priority to purchase loans over refinances. If you're refinancing and rates are low but threatening to rise, lock in for 45-60 days. Now is a great time to refinance not only because interest rates are low, but because there will be fewer home sales during the winter months and less competition to worry about in terms of getting the loan closed on time. THE CLOSING: Get a copy of the Federal Reserve Board's "A Consumer's Guide to Mortgage Lock-Ins" at http://www.federalreserve.gov/pubs/lockins/default.htm. Dian Hymer, a real estate broker with more than 30 years' experience, is a nationally syndicated real estate columnist and author. |
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| Share your love of California at www.yourpieceofcalifornia.com There’s no doubt about it. California is a great place to live. Eternal sunshine, miles of gorgeous beaches, majestic mountains, and beautiful stretches of desert – this state has something for everyone. With so much to offer, it’s no wonder everyone would like to own their own piece of California. Tell the world how special your piece of California is! Leave a short comment at www.yourpieceofcalifornia.com via your Facebook or Twitter account and join others in sharing the love for California neighborhoods, beaches, and mountains. Looking for a home - the right home - is a big task. To help your property search become a little easier, visit www.yourpieceofcalifornia.com. Not only will you find many great tools – from homes for sale to neighborhood information – you’ll be able to share your thoughts about your piece of California, and see what others have said about our state. |
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| CFLs today Energy-Saving Bulbs Offer More Choices, Less Mercury, and Easier Disposal By Michelle D. Alderson General Electric introduced the first compact fluorescent light bulb (CFL) to the market in 1992. In that same year, the U.S. Environmental Protection Agency (EPA) established the ENERGY STAR label as a “voluntary labeling program designed to identify and promote energy-efficient products to reduce green house gas emissions.” CFLs were one of these newly regulated products. The energy-saving bulb wouldn’t find popularity, however, until the new millennium when mainstream America became more conscious of energy conservation and the environment. Today, the CFL is still growing in popularity; consumers like that it saves energy -- and money. According to the EPA, in 2007, Americans saved $1.5 billion by switching to ENERGY STAR-qualified CFLs. The CFL light bulb has also improved greatly in the past 30 years with more lighting choices, regulation of its mercury output, and easier disposal. Choosing the Right CFL Initially there was only one type of CFL available and consumers didn’t have the option to use CFLs in diverse lighting fixtures such as chandeliers, sconces, and ceiling fans., Different sizes and wattages of CFLs are now available, as well as bulbs for three-way lamps and dimmers. Following is a quick guide that will help you choose what type of bulb to use with the different lighting fixtures in your home. Chandeliers Type of bulb: Low-wattage covered bulbs that are not as bright as regular CFLs, such as a 40-watt bulb. Ceiling Fixtures Type of bulb: Spiral or covered bulbs with 2700 to 3000 K. Choosing between a covered or spiral bulb is an aesthetic choice with a ceiling fixture that has an open shade. Table and Floor Lamps Type of bulb: Spiral or covered with 2700 to 3000 K in lamps that have a fabric shade or warm-colored glass. For lamps that have more of a blue-colored glass shade, choose a CFL with 3500 to 4100 K. Sconces Type of bulb: Low-wattage covered bulbs that are not as bright as regular CFLs, such as a 40-watt bulb. As with ceiling fixtures, choosing between a covered or spiral bulb is just an aesthetic choice with a ceiling fixture that has an open shade. Recessed Lighting Type of bulb: Indoor reflector. Since recessed lighting is used often, use a bulb that is longer lasting. Mercury and Disposal The mercury content in an ENERGY STAR CFL cannot contain more than five milligrams of mercury; most contain less than four, which is just enough to cover the tip of a ballpoint pen, according to the Lighting Research Center at Rensselaer Polytechnic Institute (RPI). Disposal is getting easier, but a CFL cannot be thrown into the trash like a regular lightbulb. Home Depot and IKEA recycle CFLs and you can also visit Earth911.com to find out other local recycling centers. To clean up a broken CFL properly, instructions will differ based on the surface (for example, carpet or hardwood floors), but the first thing to do is ventilate the room. Go to the EPA Web site at http://www.epa.gov/mercury/spills/index.htm#flourescent for the correct procedure. For more information on CFLs, including how they work, visit ENERGY STAR’s website (http://www.energystar.gov/index.cfm?c=cfls.pr_cfls). |
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| Protect real estate from Medicaid By Benny Kass DEAR BENNY: Seven years ago, when my mother was 80, my husband and I purchased cooperative apartment shares in a senior complex for her to live in. Since at least one of the tenants had to be over 55, we put her name on the shares, as well as my name. The actual paperwork reads: " 'My Mother's Name' or 'My Name' as joint tenants with right of survivorship and not as tenants in common." If my mother needs to move to assisted living or a nursing home, will Medicaid try to get possession of this apartment? I've called the co-op's attorney, senior law offices here in Reno, Nev., and I've called private attorneys. No one can give me an answer. One office suggested I call the Medicaid office. As much as I would like to, I think that might give Medicaid an opportunity to take what isn't hers. We used equity in our home to purchase this apartment. My mom lives on Social Security and could never afford this apartment. One lawyer suggested the co-op "reconvey" the share back to my name, but their bylaws require that whoever is on the deed live there. Any ideas? Are we safe in keeping this, selling it and keeping the monies, or will Medicaid take it? --Penny DEAR PENNY: This is a complicated question and I am surprised that the senior law offices were unable to assist. There are a number of "elder lawyers" throughout the country, and you can locate them on the Web. I searched "elder lawyers" and found a number of Web sites that should be of assistance to you. Generally, however, Medicaid (which is administered by the state, with each state having its own rules) does not "get possession" of property. But if your mother applies for Medicaid, I assume she will need to disclose her interest in the co-op as an asset. It is possible that the state will take into account the fact that she is not an "equitable" owner of the property (as she did not contribute to the purchase price of the property) and simply disregard the asset. But even if she is considered to be an owner for Medicaid purposes, the state may impose only a lien on the property rather than require it be sold. In fact, if the state considers the co-op interest an asset of your mother, it wouldn't require her to sell it, but could deny her benefits until her assets, including her interest in the house, were spent down to whatever the threshold is in Nevada. Many states allow a number of exceptions. For example, if a disabled family member (or a spouse, which I assume there is none) is living in the property, the Medicaid applicant would qualify for benefits and a lien would be imposed on the applicant's share of the property in the amount of any benefits paid -- but the benefits would need to be reimbursed when the property is sold or the disabled person or spouse dies. This is a highly specialized area of law, and not all attorneys understand the rules or the law. DEAR BENNY: I have a question about escrows for taxes and insurance. Let's say I am buying a home and last year's tax bill was $1,200 (or $100 per month). Can the lender set up escrow collecting $150 per month for taxes? --Nate DEAR NATE: My mathematical skills are limited, but the answer to your question is no. According to the federal Real Estate Settlement Procedures Act (commonly known as RESPA), a lender who collects money in escrow for real estate taxes and insurance can have only a two months' cushion on an annual basis. So, if the bank is collecting $150 per month, annually that comes to $1,800. A two-month cushion allows you to collect only $1,400, or $116.66 per month. But depending on when settlement takes place, the lender does have the right to collect sufficient funds (plus two months extra) to make sure that it can pay the taxes and insurance when they become due. Let's take this example: You settle (go to escrow) on May 15. The tax bill in your jurisdiction must be paid by Sept. 30, 2010, but is applied from January 2010 through December 2010. Because mortgage interest is calculated in arrears, your first payment will due in July. (Note: The lender will charge you interest at closing from May 15 to the end of that month.) By the time the real estate tax bill has to be paid, you will have made three payments in escrow (July, August and September). But the lender needs a full 12-month payment. Accordingly, the lender has the right to charge you -- at closing -- nine months' escrow to collect all the money needed, plus two months' cushion; in other words, the lender can charge you at closing for 11 months' escrow. Here's a consumer protection suggestion: Because too many lenders often do not make the tax or insurance payments on a timely basis -- or in some cases do not make the payments at all -- homeowners should send their lender a demand letter, once a year right after the taxes or insurance payments are due, requesting proof that those payments have, in fact, been made. For those jurisdictions where this information can be found online, you should learn how to access this from your local government's Web site. Benny L. Kass is a practicing attorney in Washington, D.C., and Maryland. No legal relationship is created by this column. |
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| Sellers face new dilemma in timing the market By Dian Hymer Some sellers have been biding their time for three years and now wonder if they should continue to wait or bite the bullet and sell now. Karl Case, co-creator of the widely followed S&P/Case-Shiller Home Price index, thinks there's a 50-50 chance that we're at the bottom of the market and that we'll see improvements in the months ahead. Unemployment remains a concern. An increase in the number of new households is predicated on an increase in jobs. Even if we have seen the worst of the recession, most analysts believe the housing recovery could be rocky for years. A quick turnaround is probably not on the horizon. The home-sale market is generally better this year than it was last year at this time. Interest rates are lower by about 1 percent. Mortgages are much more readily available. Home prices have dropped significantly, making it possible for buyers to afford to buy a long-term home. An increasing number of fence-sitters have turned into motivated buyers. However, they are focused on value, condition and location; they aren't overpaying, as they did in 2006. It's still a buyer's market and could remain so for some time to come. Sellers who purchased within the last five years might need to sell for less than they paid. One couple bought a home in Crocker Highlands, a coveted Oakland, Calif., neighborhood. They paid just over $1.1 million in 2005 and made improvements to the property. They sold in 2009, after investing more to prepare the property for sale. They received multiple offers, over the list price. The home sold for $905,000. These sellers weren't happy about the loss. But, their goal was to own only one home. They bought a retirement home near Sacramento and were spending most of their time there. Holding onto the Oakland home was a financial drain, particularly since they were there only part time. They couldn't rent the property out for enough to cover the ownership costs. Another homeowner realized before the recent economic downturn that she couldn't afford to continue to make hefty mortgage payments due to a drop in her income. Emotionally attached to her home that she'd improved over time, she decided not to sell then, which would have resulted in a profit. Instead, she rented the property for a few years and moved in with a friend to lower her overhead. Although the rent reduced her monthly debt load, it didn't cover the carrying costs. When she finally sold in January 2010, prices had dropped to a point that the property sold for less than the amounts of the mortgages secured against the property. To get lender approval on a short sale, the seller had to contribute cash at closing. Clearly, she would have been better off financially if she had sold years earlier. HOUSE HUNTING TIP: Deciding whether to sell now and take advantage of an improved home-sale market or wait for a better time is complicated. First, you need to know the approximate selling price of your home in this market. How much work needs to be done to get the property ready to sell? Does the house have any defects or deferred maintenance that will impact the sale price or make the property harder to sell? If so, this would negatively impact the price. This information can be obtained through your real estate agent. THE CLOSING: Low inventories of good homes in some niche market gives sellers an edge. Even so, you'll be successful in today's market only if you are realistic about the current market value of your home. Dian Hymer, a real estate broker with more than 30 years' experience, is a nationally syndicated real estate columnist and author. |
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| Nothing seems to fix low shower pressure By Paul Bianchina Q: I have a shower in my master bath that has had low pressure since we built the home five years ago. I've taken the head off and the pressure is still weak. All the other water sources in the house have very good pressure. A friend mentioned that the cartridge could be the culprit. Does that sound right? Is it hard to replace? I'm pretty handy and have fixed a bunch of stuff in previous homes. A: If you have good pressure everywhere else, then I would agree with your friend that the cartridge is probably the problem. Since it's been doing this since the house was new, it probably has a small piece of dirt, solder or other debris in it. Changing the cartridge is not difficult, although the exact procedure will vary between faucets and manufacturers. First, shut off the water supply. Since it's unlikely that you would have individual shutoffs for the shower alone, you'll need to shut off the main supply to the entire house. To remove the old cartridge, pop the plastic cap off the center of the handle to access the screw underneath. Remove the screw, and remove the handle. Behind that is a trim plate -- remove the screws and remove the plate. That should give you access to the cartridge, with will be held in place with screws or a threaded ring. Take the old cartridge to any retailer of plumbing supplies, and they can fix you up with a new one. Complete reinstallation instructions will be included with the new unit. Incidentally, you can also buy repair parts to rebuild the existing cartridge, but I would recommend spending a little extra and simply replacing the entire cartridge unit. Before installing the new cartridge, I would recommend flushing the valve to be sure you've removed all the debris inside. With the cartridge still out, have someone slowly turn the water back on. Don't turn it all the way back on, because that will generate quite a stream. Watch the water as it comes back on, and you should see a strong, steady flow begin. Assuming it does, have your helper shut the water right back off again, then proceed with the cartridge replacement. If the cartridge replacement doesn't fix the problem, then you could have some type of obstruction in the water lines leading to the shower. In that case, I would recommend having a good plumber come and take a look -- if possible, use the same person who plumbed the house originally, since they'll know right where to look. How do I get that old epoxy paint off? Q: I hired a contractor to put an epoxy on my garage floor. When the epoxy was being installed the contractor asked if I wanted it to end at the point the garage door hits the concrete or run to the end of the concrete slab, which extends about 4 inches beyond the point the garage door touches down. I opted to have the epoxy extend beyond the door. The problem now is that the 4 inches of epoxy outside the door has discolored (yellowed) and now looks poor. My question is -- is there a way to remove the 4 inches of epoxy? Thanks for any help; I really enjoy your column. A: One of the great things about epoxy paint is that it's virtually a permanent coating. In a situation like yours, however, that's also its drawback -- it's very tough to remove. Epoxy garage-floor coatings are also not suitable for exterior use, so I'm a little surprised that the contractor even suggested painting it in an area that's exposed to the elements. Since we're not talking about a large area, my suggestion would be to sand the epoxy off. Use a pad sander or orbital sander with 60- or 80-grit paper, and use a strip of wood or other material to create a straight line that you can sand up to where you want the paint to stop. Be sure to wear both eye protection and a respirator while sanding. After sanding and cleaning the strip of concrete that will extend beyond the garage door, you can apply an exterior concrete sealer to it that will both protect the concrete and enhance its appearance. I also would suggest that you consider installing a vinyl garage-door sill strip on the concrete where the door meets the floor. This will create a visual break between the inside and outside, as well as providing you with some additional wind and water protection at the bottom of the door. Garage door sills are available at many home centers, as well as through garage-door dealers. They're easy to install -- simply cut the material to length and glue it in place. Complete instructions will be included with the sill strip. |
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