Yes. 1986 was a fantastic year for home sales, but I think 1987 will be even better. Lower mortgage interest rates mean more prospective buyers can afford to be looking for homes and buying them. Except in economically depressed areas, such as parts of Texas, Oklahoma, Louisiana and South Florida, increased buyer demand should cause substantial home-price appreciation.
The busy spring home-buying season of March through May is usually the best time of year to sell a home because that is when the buyers come out of winter hibernation. But spring is the worst time to buy a home because prices usually rise because home supply is limited and there is more competition from other prospective buyers.
Now is the time to get your home ready to sell during the spring home- buying season. If necessary, paint the interior and recarpet now. When the weather is good, paint the exterior; clean up the yard; improve the landscaping, and do any necessary repair work. Your goal should be to make your home a "red-ribbon deal" in first-class condition. These inexpensive improvement costs should make your home sell quickly for top dollar.
I own and live in a condo where the board of directors just announced a monthly increase in the maintenance-fee assessment. This increase will seriously hurt my budget and may force me to sell my condo. The reasons given for the big increase include the need to raise reserves, need to replace the roof and bad past management. Isn't there some law limiting the amount of maximum condo assessment fees?
A condominium is a miniature city, with its own city council (the board of directors) and mayor (the condo association president). Although a condominium is a democracy, with annual election of directors and officers, the voters (condo owners) have little to say about the day-to-day operations and taxes (monthly assessments).
I am not aware of any law limiting the maximum increase in assessments. Unfortunately, your only choice is to pay or sell.
I own a rental house that the tenants just vacated. It needs interior painting, carpet cleaning and plumbing repairs, which will cost about $1,000 total. Since I plan to sell this house, do you think I should spend the money or let the buyer do the work the way he wants it?
Always fix up a property into tiptop condition if you want to get the maximum sales price for it. Spending $1,000 for those minor repairs will not only assure a good sales price, but the home will sell much faster if it is spotlessly clean.
The same rule applies to rentals. Before showing the house to any prospective buyers, tenants or real estate agents, always get the house in perfect condition. Dumpy houses appeal to bargain hunters like me who expect big price reductions far greater than the cost of repairs.
My husband and I are retired, ages 73 and 66. We want to move to Florida and buy a small home. In November, we visited the area where we plan to live. We made a purchase offer on a very nice smaller home. Although we have about $400,000 in various savings accounts, retirement trusts and common stocks, we were rejected for a mortgage even though we offered a 25 percent down payment on the house. The real estate agent said the reason was our monthly mortgage payment would take about 40 percent of our income. As we have no other debt and we have $400,000 of relatively liquid assets, do you think the mortgage company was discriminating against us because of our ages? What were we doing wrong?
It is illegal for mortgage lenders to discriminate because of the borrower's age. Several years ago, my parents, then in their late 70s, had no trouble getting a 30-year mortgage. You should have no trouble getting a new mortgage at your age.
However, the problem appears to be the one lender you applied with has inflexible loan qualifications because the lender wants to sell your mortgage in the secondary mortgage market. Your best bet is to borrow from a ''portfolio lender" who plans to keep your loan rather than sell it. Portfolio lenders have much more flexibility than those who sell their loans in the secondary mortgage market. Your real estate agent should have referred you to a portfolio lender.
Unfortunately, the fact you have $400,000 in liquid assets is immaterial to most inflexible mortgage lenders. All they care about is your income and the percentage of it which the mortgage payment will take. Of course, your credit history for prompt payment of bills also is important.
When you make your next purchase offer to buy a home, make it contingent upon obtaining the necessary loan. Then apply with a portfolio mortgage lender recommended by the real estate agent.
My husband and I are getting a divorce. Because we have three children, ages 4, 2 and 1, I am unable to work. In the divorce settlement, I am to get the house. But my husband hasn't paid me child support or alimony for the last three months, and I haven't paid the mortgage since November. I have used up almost all my savings to pay for food and utilities. The mortgage company has sent me two threatening notices of foreclosure. But I can't find my husband, and he has left town so I can't tell the mortgage people when I can pay the mortgage. My lawyer says she can't help me. What should I do?
Contact your mortgage lender, preferably in writing, to explain the problem and what you propose to do about it. If there is little or no chance of receiving child support or alimony payments soon, perhaps you should sell the house to preserve your equity so it won't be lost by foreclosure. If that is your plan, tell the lender, and ask that foreclosure be delayed to allow you time to sell.
However, your husband's signature will be needed if he is a co-owner on the title. Your attorney should be able to recommend an investigator to locate your husband. This situation will only get worse unless you take action to solve the problem. Also, don't be too proud to ask for welfare payments to help get over your financial distress.
In 1986 we were assessed $520 for our share of new sewers, streets and sidewalks in front of our home and a rental house we own next door. Can we deduct this cost as a property tax on our income tax returns?
Yes and no. Special assessments for civic improvements such as sewers, streets and sidewalks are not tax-deductible as property taxes. However, the special assessment should be added to the cost basis for each property.
On the rental property, the assessment becomes part of your depreciable cost basis and, therefore, becomes deductible as depreciation expense. But on your personal residence, the special assessment cost merely increases your cost basis, much like a capital improvement to your home. See your tax adviser for further details.