Updated: Thursday, January 17, 2019

Top 8 Estate Planning Mistakes

Perhaps you have heard the expression: ldquo;If you fail to plan then you plan to fail.rdquo; This statement was never truer than for estate planning. By some accounts, 70 of adult Americans have no will or trust in place for their loved ones. Furthermore, others who initially did prepare an estate plan have failed to update it in light of changing circumstances in their lives.

With this backdrop, I wanted to summarize what I have seen over the years as the most common estate planning mistakes that people make.

1. FAILURE TO PRESERVE YOUR INHERITANCE FOR YOUR GRANDCHILDREN SHOULD YOUR SON/DAUGHTER DIE AND THEIR SURVIVING SPOUSE REMARRY.

You need to take steps in drafting your estate plan to assure that your assets are distributed to your grandchildren should your son/daughter die and not left to your daughter-in-law/son-in-law who could eventually remarry and end up using your inheritance with the new wife/husband and his/her step kids ndash; all of home have no familial >

2. FAILURE TO AVOID A GUARDIANSHIP PROCEEDING FOR YOUR CHILDREN.

If you have children, have you considered who would raise them if for some reason you or their other parent couldnrsquo;t. While this is not an easy subject to contemplate, having a guardian arrangement spelled out as part of your estate plan will ensure they will be properly cared for by someone you trust and have chosen. A legal guardian is a person who is given the legal authority and responsibility to take care of your childrenrsquo;s needs, such as providing food, education, medical care, dental care and shelter. If you have minor children it is imperative to have a plan in place to protect them in the event you cannot.

3. FALL OUT FROM REFINANCINGS AND THE FAILURE TO PUT YOUR REAL PROPERTY BACK IN AN EXISTING TRUST.

Did you know that most home refinancings require that your home be transferred out of a living trust back to your own names, at least until after the new lender has recorded its new mortgage or deed of trust on the property? The problem is that is most cases, no one ever thinks to transfer your real property back into the trust. This failure can result in an unforeseen probate of your home at the death of the second spouse.

4. FAILURE TO ENSURE THAT YOUR ASSETS ARE DISTRIBUTED THE WAY YOUR WANT AND NOT PURSUANT TO THE GOVERNMENTrsquo;S DEFAULT PLAN FOR YOU.

Everyone has an estate plan. It is either the one we have created or the default so-called Plan B of the state in which we live. In our experience, it is very unlikely that a statersquo;s default plan is what clients would really want. State laws vary, but generally they have it set for the assets go outright to the closest family members. Whom a state considers to be ldquo;closestrdquo; can be complicated in nonnuclear families. Nonfamily members, like an unmarried partner, will not receive any of the assets. This failure to act could cause family member fights over their inheritance.

5. HAVING ONLY A WILL OFTEN LEADS TO THE NEED FOR PROBATE.

Having only a will is a just ticket to participate in the dreaded probate process costing your family time and money. Additionally, for those who donrsquo;t have a will, their assets will probably have to go through the intestate ldquo;no willrdquo; proceeding. Either of these scenarios will require that your assets go through probate before they can be fully distributed to the heirs. Probate proceedings vary from state to state, but many view the time, cost, and loss of privacy and control that come with probate as unnecessary evils which can ndash; and should be ndash; avoided.

6. AN OLDER PERSON HOLDING TITLE TO THEIR REAL ESTATE IN JOINT TENANCY WITH A CHILD OR GRANDCHILD.

Many older people add an adult child or grandchild to the title of their assets especially their home as a joint owner in order to avoid probate. However, this type of property can create all kinds of problems, including:

When a joint owner is added, the original owner loses control:

Jointly owned assets are exposed to the joint ownerrsquo;s possible misuse of them;

Part of these assets could be lost to the joint ownerrsquo;s creditors;

The assets could become part of a joint ownerrsquo;s divorce proceedings.

7. FAILURE TO PROTECT FAMILY MEMBERS WITH DRUG ALCOHOL, GAMBLING ISSUES.

Many parents with a trust fear that an inheritance left to a child may be lost because of poor money handling skills or a drug, alcohol or gambling addiction of their children. With a living trust, you can instruct the successor trustee to retain personrsquo;s inheritance in trust and instruct the trustee to make payments, as needed, directly to third parties for rent, insurance, car payments, etc. to keep it out of their hands.

8. FAILURE TO HAVE POWERS OF ATTORNEY FOR UNMARRIED ADULT CHILDREN.

Letrsquo;s say you have a college student or a young adult over 18 who is unmarried. Theyare no longer minors that you have the legal authority to make decisions for. The law now >

1. Driverrsquo;s license or vehicle registration renewals

2. Registration/admission for college

3. Tax return filing

4. Banking transactions

5. Ongoing legal matters e.g., pending lawsuit from that fender-bender a few months back or speaking with childrsquo;s landlord

6. Jury duty summons

7. Passport renewal

Many estate planners urge clients to prod their adult children to draft POA on or around their 18th birthdays. So donrsquo;t forget a POA and make it one of the most important things on your to-do list.

SUMMARY

A will or trust is not a static instrument. To serve its purposes, it must keep current with life changes, including an individualrsquo;s financial circumstances, and with some external factors, such as tax laws. With the help of a professional, you should periodically review your will, staying alert to new or different circumstances that might call for updates. Let us help you have the peace of mind you deserve

Contact our office for a free analysis of your situation and receive a FREE estate planning session valued at 750.00 consultation or a trust review if you already have a trust to make sure it is current. Contact Mark Klein at or 949 453-7979 call to schedule an appointment.


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3 Signs Your Agent Deserves to be Trusted

Natural fear in taking action or making a decision is meant to preserve our health, property, and way of life, but it can do the opposite. For some real estate buyers and sellers, any change or decision is seen as risk to be avoided. Even those less afraid of risk or more confident about decision making usually >

Since it is the person delivering information who usually imparts "trust-ability" to facts and choices, your ability to read the "trust-worthiness" of real estate professionals you intend to >

In this column, were not discussing cheats or crooks who are out to deliberately commit fraud or worse. Thats a discussion Ive had with you many times before including this earlier column: "Silent Crime Against Homeowners: Mortgage Fraud." That said, remember that professionals with the best of intentions but without up-to-date knowledge or skills can pose risks for sellers and buyers.

Without trusted input, individuals and couples can second guess themselves when buying or selling, vacillating on whether to stick with their decision or not. For instance, "buyers remorse" is a risk-averse response attached to purchases of anything linked to dramatic or expensive change like real estate. Trust grounded in the value of the purchase and the soundness of the buying decision reduces risk aversion, and lessens or eliminates second guessing. This trust usually arises out of the >

How can I be sure my real estate professional deserves to be trusted? Here are three signs to look for:

1. Encouragement: The correct answer to the question above is, "you cant always be sure about others." Instead, its yourself who you must trust. A real estate professional who is intent on increasing your knowledge of how the sales process influences outcomes is also determined to build your confidence in your decision making. At the same time, your skepticism will be encouraged by welcoming your questions and contributions. As you gain confidence in your understanding of buying or selling real estate, youll realize how and when to trust yourself and the real estate professional and brokerage youve chosen to >

2. Clarification: Trust in the face of certainty is an achievement, however, trust in the face of uncertainty is an art. When a knowledgeable real estate professional delivers services, or explains properties or advice, they also clarify what they expect to receive from buyers or sellers who give their trust to the professional. In other words, during the uncertainty of the adventure into real estate, buyers and sellers are told how they can act in their own best interest to facilitate good outcomes from their real estate transaction. Trust takes the form of clarifying wants and needs, confirming budget limitations, and finalizing key decision criteria like location and price range. When a real estate professional is unclear or unspecific about what buyers and sellers can expect during the transaction, trust can be replaced by confusion and frustration. If you find these are common reactions when dealing with your real estate professional, why would they deserve to be trusted? Search out that real estate professional who is clear how to make real estates inherent uncertainty manageable from your point of view.

3. >: What is said, written, texted, postedhellip;matters, but how professionals act on what they communicate matters more. When a professionals interest in you is genuine, this concern is visible in every facet of the work carried out for and with you. Your interests should always be transparently and prominently placed above the professionals according to the Agency Law and fiduciary agreements that rule real estate. This commitment materializes as services that are >

Perception is the reality in earning trust and loyalty. Your definition of trust, and the professionals, need to be aligned.

  • Should trusting include you questioning the professional, or is unquestioning acceptance demanded by the professional?
  • Is their reaction defensive or offensive if their knowledge or skill is challenged?
  • Do you understand exactly what the professional expects from you and from themselves as your >

From the start, you deserve to understand what "trust" will mean to both of you, and to your real estate outcome. Trust yourself to be sure about this.

Source: "Whats Your Point?" CatapultPublishing.com


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You Can Keep Your KonMari Method: Why Tidying Up with Marie Kondo Is Not for Me

If you havenrsquo;t caught the show and you arenrsquo;t familiar with its namesake star or her famed KonMari Method, let me give you a quickie overview, courtesy of Netflix: ldquo;In a series of inspiring home makeovers, world-renowned tidying expert Marie Kondo helps clients clear out the cluttermdash;and choose joy.rdquo;

Yes, ldquo;choose joy.rdquo; Kondorsquo;s shtickmdash;and I only use shtick for lack of a better word because joy does, actually, seem to emanate from hermdash;is that having too much stuff can steal that joy. And each item you keep in your home should spark joy, not take away from it.

Bring on the joyous decluttering. But not exactly the joyous watching.

Yes, America is having quite a love affair with Marie Kondo, and I guess I sorta get it. I see how her tips could be transformative, if youre open to them. Frankly, Irsquo;m not. A few minutes into episode No. 1, I had to fight the urge to go throw some [more] clothes on the floor instead of thanking each item individually as I was choosing to get rid of it, as is her recommended process.

But herersquo;s my bigger concern: These families on her show have issues. Not any more or bigger issues than other typical American families, but issues that definitely peek through the cracks of a crammed closet. I mean, Irsquo;m a believer that a pretty house can solve a lot of lifersquo;s problems, but to think that tidying up can fix your family is a little much, no?

Letrsquo;s take Kevin and Rachel Friend and their two uber-adorable kids, the family from the first episode. Hersquo;s busy and overworked and craves/expects a perfectly kept home. Shersquo;s admittedly sloppy and overwhelmed and home with the two kids most of the day plus working part-time. Clutter is clearly affecting their >

When it was all wrapped up in a Marie Kondo-approved bow at the end of the episode, I wasnrsquo;t even a little convinced that the family had permanently changed, or that they had healed, just because the bottles and plastic wear were nicely tucked away and the t-shirts were all folded in Kondo fashion in a drawer a process Irsquo;m finding super irritating since it will clearly only work for those who are painting the rainbow with their tees and not housing 75 similar shirts in shades of gray and black, BTW.

Please, Netflix. Commission a follow-up show ASAP. I need to see these people in one, three, and six months. And they need to be surprise visits. There, season two is all planned out.

Even better, make season some kind of collab between Kondo and a marriage counselor.

In the beginning of episode two, Wendy Akiyama basically explains how, now that she and husband Ron are empty nesters, itrsquo;s a great time to tackle the house since therersquo;s no pressure to actually participate in their >

She later announced, after going through the tidying up process, that her ldquo;retail therapyrdquo; was a way to hit her husband ldquo;where it hurts.rdquo; Ouch, but points for the self-realization. I really hope Netflix left them with a resource to talk through some of their issuesmdash;together. Perhaps Ron will tell the truth about how he really feels about paring his baseball card collection down, because no one who watched that believes he loves 10 cards just as much as he loved 1,000.

I have to admit this show stressed me out, and not just because the Akiyama house was closing in on some Hoarders-level stuff. I mean, they got rid of 150 BAGS OF TRASH. ONE HUNDRED AND FIFTY It was all just starting to feel like The Biggest Loser, Dysfunctional Family with Household Clutter Edition. Sure, you can lose the weight/clear the clutter, but what happens if you donrsquo;t get to the reasons behind it?

Two and one-half episodes in, Irsquo;m done. And, Irsquo;m still more comfortable with my everyday mess than the idea of militant tidying. Plus, I feel like clutter-clearing should exist on some kind of a sliding scale according to the size of your space. I have a huge master closet and, frankly, it sparks panic for me to think about having to clean it out.

Plus, I saw something recently that said that messy people are smarter, and, you know what: That definitely sparks joy.


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3 Percent Down?

Government-backed mortgage loans, VA, FHA and USDA, require little to no down payment. FHA loans ask for a down payment of at least 3.5 percent of the sales price while the other two donrsquo;t require any down payment whatsoever. But did you know there are conventional loans that also accept a down payment of just 3.0 percent? There are three such programs, Fannie Maersquo;s Home Ready, Freddie Macrsquo;s Home Possible and the Conventional 97, another Fannie entry. But the Conventional 97 comes with fewer strings attached.

Home Ready is a program designed for first time buyers and asks for a 3 percent down payment. The program was designed to help underserved areas and geared toward low to moderate income buyers. The property must be owner occupied and there are income limitations for the borrowers. Borrowers cannot make more than 100 percent of the median income for the area.

In certain areas designated as high-minority, there is also an income limit at 100 percent of median income. Home Possible is Freddie Macrsquo;s entry and has similar restrictions regarding income and location. Because of the income limitations and areas served, there will be limits regarding the final loan amount. Buyers must not have owned a home within the previous three years.

For both programs, borrowers must take a Home Buyer Education Course from an approved provider. The lender has a list of such agencies that help consumers get into their first home.

The other player in this mortgage world is the Conventional 97. This program also requires just a 3 percent down payment but there are no restrictions regarding loan limits. Instead, the only limit is the one all conforming loans have which is 484,350 in most parts of the country. Like the others, the property must be for a primary residence and the Conventional 97 cannot be used to finance a rental or investment property.

This program has been around for several years but appears to be catching on. The Conventional 97 can be compared to an FHA loan, the primary difference being the 3 percent needed for the conventional loan and 3.5 for the FHA. FHA loans also have a county-by-county loan limit as well, but theyrsquo;re going to be higher compared to Home Ready and Home Possible. For most parts of the country, the maximum FHA loan for 2019 is 389,350.

All of these low down payment options will require some form of mortgage insurance and some premiums are higher than others. But if you or someone you know is looking for a low down payment loan program, take a look at the Conventional 97 while comparing options.


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What You Dont Know About Real Estate Could Cost You

Itrsquo;s what you donrsquo;t know about real estate that could cost younbsp;when buying or selling.

bull; First-time buyers usually havenrsquo;t seen enough houses or condominium units to fully understand where real estate value lies.

They may not have been caretaker of a house and, therefore, donrsquo;t notice subtle signs of damage, sloppy construction, poor maintenance, or worn-out elements. Those who have visited friendsrsquo; houses will ra>

bull; First-time-in-a-longtime buyers may not realize that they are out of touch with advances in materials, modern design approaches, or evolving life>

This can lead them to under- or over-value new houses or condominium units.nbsp;For example, quartz kitchen countersnbsp;have gained popularity over marble and granite for several reasons. Open-concept design is preferred by those with small children or those who live to entertain, but not by those who are untidy, >

bull; First-time sellers who base resale value on their total costnbsp;of acquiring and maintaining real estate ownership, plus expectednbsp;profit, have missed the point.

Emotions, including pride of ownership, can get in the way and prove expensive. Sellers may believe that their cost of buying and transforming the property into their home, plus money spent on maintenance and upgrades, plus profit and the cost of selling, including commission, add up to their actual ldquo;bottom linerdquo; for resale value. Problems arise for sellers when this must-have sale price is not in line with market value, which is value determined by the real estate market - current buyers and previous sales. When the seller expects more than market value, this ldquo;over-priced listingrdquo; may take longer to sell, may eventually sell for less, or may fail to find a buyer. First-time sellers may lack experience evaluating how their property compares with local property values and appraising their property from the perspective of current active buyers.

Value determination and marketing - or communicating action-enticing value to potential buyers - represent two different professional real estate selling-skill sets, neither of which are usually possessed by sellers.

bull; Empty-nester and downsizing sellers may decide, in theory, that smaller and cheaper are the characteristics they desire in their next property, but some discover itrsquo;s a different story in practice.

When faced with the actual move to a smaller house in a cheaper location, they may find the mental leap too great. Downsizing is often wrongly considered me>

Many faced with wanting a change find they lack the real estate knowledge and planning expertise to make the shift gracefully acceptable and financially successfully.

bull; Newbie real estate investors may believe that crunching numbers to determine how much profit they want and what it will cost to achieve this profit is all it takes.

Creating an offer to purchase, which entices a property owner to sell for the buyerrsquo;s desired price, requires special professional expertise. Then, offering the property for profit-generating rent that will attract qualified prospective renters involves a different set of professional skills. Many new investors possess neither skill set, which are both common in real estate professionals.

The emotional element regarding what sellers will sell for and what renters will pay to live in the resulting investment property can influence financial gain and bottom-line projections. Skill and experience is essential to investors taking all this into account to create profit.

What you donrsquo;t know about property ownership and real estate transactions can cost you when buying or selling, wherever you fit in on the list of buyers and sellers above. Do you have experience with contracts, financing, interior design, renovation, conflict resolutionhellip;? Then, therersquo;s marketing - both using it to persuade others and personally fending off its effects when yoursquo;re making decisions.

What you donrsquo;t know about real estate, real estate professionals do. They are committed to studying and keeping up to date on what matters. Most have spent years on the job perfecting their expertise and learning local markets.

Would you surgically operate on yourself or drill your own teeth? Itrsquo;s that extreme an issue when you donrsquo;t engage available professional skill and knowledge to work for and with you.

Concentrate on learning what the right real estate professional cannbsp;help you achieve.

Not the least of which is discovering what you donrsquo;t know about buying and selling. When you think, my goal is ldquo;buy my dream homerdquo; or ldquo;sell at my dream price,rdquo; understand what will have to happen and what you must do to achieve the desired outcome.

If you donrsquo;t know where to start, no problem.

Real estate professionals are trained to know what needs to be done for prospects and clients every day, every offer, every transactionhellip;. Do you know what yoursquo;ll gain with professional help? How determined are you to achieve real estate goals and exceed your expectations, as quickly and hassle-free as possible?

To continue learning about buying and selling real estate, checkout more Realty Times articles by PJ Wadenbsp;The Catalyst:

bull; 4 "Big Regrets" to Avoid When Buying a Homenbsp;
bull; Trends Cost Sellers Money
bull; Ready to Talk About Real Estate?


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5 Reasons to Buy a Fixer-Upper Instead of a Perfect Place

.It costs less

ldquo;Fixer-uppers list for an average of 8 below market value,rdquo; said LearnVest. If yoursquo;re on a budget or are being priced out in your market, this is a way to get a literal foot in the door. How much depends greatly on the location. ldquo;Fixer-uppers in Phoenix have the smallest cash discount, saving buyers just 1,000 off list price. But you can save a lot of money in expensive markets like San Francisco, where fixer-uppers are discounted an average of 10mdash;giving homebuyers 54,000 in upfront savings for renovations on the median home.rdquo;

You may be able to finance your renovation

One of the major drawbacks of buying a home that needs to be fixed up is having to come up with the cashmdash;especially after yoursquo;ve just put so much money into your down payment and closing costs. There are a few different types of loans that package the mortgage with funds for renovations, and they often come as a surprise to buyers who have only focused on FHA and 30-year conventional loans.

ldquo;Whether you need a new roof or your kitchen is outdated, there is a mortgage thatrsquo;s right for your fixer-upper,rdquo; said Bankrate. Fannie Maersquo;s Home>

It gives you the opportunity to build value

With an already-updated home, ldquo;If a seller has redecorated or improved the whole place, that seller is reaping the benefit,rdquo; said Forbes. ldquo;If the homes value has been raised, the buyer is paying for it. Also, consider this reality: A seller who re-does a whole house in order to sell is not likely putting in the highest-quality materials. Theyre cutting costs to maximize profit. But if you buy a fixer-upper, you might be able to secure an undervalued property, improve it and get the benefit of the extra equity. Its a core real estate concept. If you can find the right property, this could mean thousands of dollars almost immediately.rdquo;

You can do renovations over time

There may be a few things you canrsquo;t live with in a fixer-upper, like the grungy carpet and cruddy plumbing fixtures, but no one other than design shows says your place has to be perfect the day you move in. Taking your time to make updates as yoursquo;re able gives you the opportunity to save money and recover from all the expenses of buying the home and moving in.

It allows you to put your stamp on it

When you buy a home that was lived in and fixed up by someone else, it reflects their taste and >

ldquo;One of the primary reasons people buy fixer-upper properties is for the opportunity to make the space their own,rdquo; said Green Residential. ldquo;Instead of purchasing a home in which someone else designed the layout, chose the materials, and dictated where different elements were placed, you can buy a basic structure and then take charge. Itrsquo;s like building your own home without having to go through the lengthy process of drawing plans and constructing it from the ground up.rdquo;


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Whats the Real Impact of the Government Shutdown on Real Estate?

ldquo;An NAR survey of 2,211 members found 75 percent had no impact to their contract signings or closings. However, 11 percent did report an impact on current clients and 11 percent on potential clients,rdquo; said the National Association of Realtors. Among those impacted by the shutdown, 17 percent had a closing delay because of a USDA loan.rdquo;

The most impacted areas of the market surround:

Buyer uncertainty

Consumer confidence is always a topic of conversation when it comes to real estate, and with rising interest rates and a roller coaster stock market, a government shutdown only makes the issues that much stickier. According to the NAR study, ldquo;The most common impact, at 25 percent, was the buyer decided not to buy due to general economic uncertainty, though they were not a federal government employee.rdquo;

Loan approvals/Closing delays

Whether or not your loan and/or closing is impacted by the government shutdown largely depends on the type of loan you are getting. ldquo;If youre getting a Federal Housing Administration or Department of Veterans Affairs loan, its likely you can expect delays in the underwriting process, and its possible your closing date will be pushed back as well,rdquo; said the Dallas Morning News.

HUD has said that while new FHA loans will be endorsed during the shutdown, ldquo;Some delays with FHA processing may occur due to short staffing.rdquo; In addition, new Home Equity Conversion Mortgages HECM, more commonly referred to as reverse mortgages, are on hold for now.

While the White House has insisted that the Internal Revenue Service IRS process tax refunds during the shutdown, itrsquo;s made no such mandate in regards to helping consumers who need info because theyrsquo;re buying a home. That means that buyers wonrsquo;t be able to requests tax return transcripts, which may be required by lenders, thereby delaying the purchasing process.


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Housing Counsel Public Condo Law vs. Private Condo Law

Question: I am the President of a mid-size condominium in Washington.

Our Bylaws specifically prohibit short-term rentals of any kind. The board ndash; and most of our members ndash; agree that cutting out short term rentals and subleases of less than a year helps cut down on the move in and out traffic that creates maintenance distress, having renters that donrsquo;t care about the building and administrative tracking of who resides in the building.

One of our board members called to my attention that the Council of the District of Columbia recently enacted legislation that will allow ndash; under certain conditions ndash; using an ownerrsquo;s primary residence for such short term rentals as AirBnb.

Our question: are our current Bylaws, rules and regs unlawful in DC? We donrsquo;t really want to change this for reasons above, but we certainly want to be compliant with DC law.

Answer: First, assuming that the Mayor does not veto the Act, and assuming Congress stays out of the Districtrsquo;s business ndash; the law will take effect October 1, 2019.

The simple answer to your question is no, your Bylaws ndash; assuming they are recorded among the District land records ndash; are perfectly legal and enforceable. The community association attorneys here in Washington arrange to have the following language included in the new law: ldquo;if the short-term rental is on property within a condominium, cooperative, or homeowner association, the host shall provide proof that the ...association permits the operation of a short-term rental..rdquo;

If the host ndash; the owner who wants to use the unit for short term rentals ndash; finds language in the associationrsquo;s governing documents prohibiting such rentals ndash; but nevertheless proceeds with such rentals, there are strict civil penalties. For the first violation, 500; 2000 for the second, and 6,000 for the third and revocation of the business license. These are fined levied by the City.

Let us assume, however, that such additional language was not included in the new law. If the associationrsquo;s Bylaws prohibited short-term rentals, that would still be enforceable by the condo board. There is what I call ldquo;private zoning vs. public zoningrdquo;. Example: DC zoning is commercial, including medical clinics but the condo bylaws specifically disallows such clinics

Since the condo bylaws are more restrictive than the public law, it is valid. However, if the zoning is residential, the condo cannot allow commercial use unless the owner obtains a ldquo;home occupancy permitrdquo; from the District.

The condo board can also fine the owner who is violating the By-laws. However, District of Columbia law requires that the owner must first be provided a notice and an opportunity to be heard, before any fine can be imposed. This is not a formal court hearing; it is a meeting between the alleged violator and either the board or a committee appointed by the board. It gives the owner due process rights to try to explain why there was no violation.

This same due process opportunity for a hearing is also in the Maryland and Virginia condominium acts.

As you can see, it all depends on the zoning laws, the condo law in your jurisdiction, and your governing documents.


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Clever Tips to Make Painting Your Home Easier

Wrap it up

One of the most painful tasks associated with the painting is having to clean up at the end of the day. If you hate cleaning your brushes, this tip is for you. The best way to preserve your brush if youre done for the day or the time being but not done with the job, is to wrap it in plastic wrap and throw it in the freezer overnight. But, it does require about 15 minutes of thawing out the following day before you can begin again. We found that putting the brush in a Ziploc bag and making it as airtight as possible does a fine job of keeping the brush pliable for the next day, and you can just pick it up and go without the wait.

Line it

Paint tray liners are helpful in extending the life of your paint tray and minimizing clean up, but if you dont want to spend the money, head to your kitchen, instead. Aluminum foil or plastic wrap wrapped around your paint tray will keep it clean.


removeandreplace.com

Keep that foil handy

Readers Digest notes that aluminum foil is also great when painting a door. "When youre painting a door, aluminum foil is great for wrapping doorknobs to keep paint off them. Overlap the foil onto the door when you wrap the knob, then run a sharp utility knife around the base of the knob to trim the foil. That way you can paint right up to the edge of the knob. In addition to wrapping knobs on the doors that youll paint, wrap all the doorknobs that are along the route to where you will clean your hands and brushes."

Dust those walls

Prepping is key to a successful paint job, but if youre doing a quick cleanup of your walls before painting, you may not want to spray cleaner on them for fear that the paint wont adhere well. Use a Swiffer duster instead. Dust will cling to it and youll have a clean surface to paint on. nbsp;A dryer sheet is another good option for getting the dust off your surfaces - especially baseboards - before you begin.

Take out the smell

If youre using a VOC paint, any odor should be minor. But if you want to ensure the smell is pleasant, add some vanilla. "To neutralize the strong smell of any type of paint, add one tablespoon of vanilla extract a natural deodorizer per gallon. It wont affect the color of the paint," said HGTV.


FaithTap

Use a quality paintbrush

You can spend about 1 on a paint brush or you can spend the equivalent of a good lunch, and the difference will be obvious when the cheaper version leaves brush marks and bristles on your wall. Get a decent brush for a better finish, and choose an angled version for cutting in. The better the brush and paint, the better the chance you can do without all that pesky taping.

Buy the right amount of paint from the start

"Oh, I just need one gallon," said everyone, everywhere. But how much do you really need? Knowing ahead of time will keep you from having to make a return trip to the store, and help ensure your color is consistent. Color matching is better than ever at paint stores and places like Home Depot and Lowes. But there still might be a slight variation in the color if you have to go back to purchase more paint. Measure your space and you wont have to worry about it.

"The general rule is one gallon for every 350 square feet of surface area," said Real Simple. "All you have to do is measure walls roughly, then go tonbsp;Sherwin-Williams.comnbsp;and type the dimensions into the easy online paint calculator. This tool will also ask for measurements of windows, doors, and trim so it can come up with a more precise total. Whatever the number, buy an extra quart for touch-ups."

Wipe it up

Have a few drips to clean up on tile or wood floors? An alcohol wipe or wet rag will do the trick. Or, grab a cleansing facial wipe that contains alcohol. Youd be surprised how well these work.

Add a rubber band

Wrap one around your paint can so you have an easy way to wipe your paint brush and avoid drips.

Combat humidity

"Humidity means drips and slow drying, so avoid painting on a rainy day," said DIY Network. "If you must paint when its humid, take your time - and take advantage of slow-drying paint to correct your errors before moving on to the next coat."

You can reduce the amount of humidity in your home by flipping on your air-conditioning as well as any vent and exhaust fans you have in the home, in bathrooms, kitchens, and laundry areas.

Put some holes in it

"When you pour the paint, it can go everywhere," said The Bold Abode.nbsp;"It drips all over the sides and then dries hard as a rock on the edges. Whennbsp;that happens, not even King Kong himself could pound that lid down hard enough to close it secu>

Get creative with plastic bags

For awkward spaces where a drop cloth might not be the right choice, heed this tip from Family Handyman and raid your plastic bag stash. Itll keep your stuff drip-free and wont cost a thing.


familyhandyman.com

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Making Your Home More Energy-Efficient

Replace or Weatherize All Windows

Windows are one of the biggest sources of heat gain and heat loss in a home. Both heat gain and heat loss rob you of comfort and keep your energy bills higher than they have to be, whether during the summer or winter months.

Windows rank high on the list because of air leakage around the frame and the heat that transfers through windowpanes. Old single-pane windows provide little protection against heat transference. If you replace these windows with energy-efficient windows you should see immediate savings and improved climate control in your home.

When choosing windows, consider the frame and not just glass. Frame material and frame design matters. Hinged windows allow less air leakage than sliding, single-hung or double-hung do. Avoid metal because these conduct heat. Choose insulated vinyl frames or insulated fiberglass frames for the most efficiency and durability.

Pay attention to glass efficiency ratings such as the U-factor and the solar heat gain coefficient. The right windows to choose depend largely upon regional climate. If you live in an area with hot summers and mild winters, you want glass that blocks out as much solar heat gain as possible.

Low-emissivity coatings on windowpanes reduce heat conduction through the glass, which benefits you by keeping hot air inside in winter and hot air outside in summer. There are other coatings and tints available, but you should still look for the Energy Star label. Only products that have met strict requirements by the EPA qualify for this special certification.

Seal the Homes Thermal Envelope

Air leakage through your homes exterior is another source of energy waste. Air infiltration makes your heating and cooling system work harder to maintain climate control. In order to find all of the hidden leaks, schedule an energy audit with an HVAC company. Until you do, seal the noticeable leaks. These can usually be found in the following areas:

  • bull; Around window frames and doors
  • bull; Beneath baseboards
  • bull; Around flues and chimneys

When sealing leaks in most areas, you can use caulk, weather-stripping or expandable spray foam insulation. Another method to control air leaks is to replace poorly fitting doors or other features and to use hardware with a type that creates a better seal. One example is barn door hardware. This kind of hardware can create a better air seal in some cases because the door slides into place instead of swinging open. This creates fewer opportunities for gaps between the door and the frame.

Upgrade Your Home HVAC System

If your homes HVAC system is older than ten years, consider replacing it with a new energy-efficient system that is Energy Star certified. Improvements in design make these systems far more energy-efficient than any in the past. If they are sized correctly and installed correctly, you should see lower bills and improved comfort and improved air quality.

Upgrade Insulation

Most homes have only the minimum required insulation. Older homes might even fall far short of the minimum simply because the insulation has become too wet, or it has become compressed or it has shifted.

Adding insulation to the attic will have the largest effects. It doesnt matter which kind of insulation you use as much as it matters that it is properly installed, with no gaps, and that you use the recommended quantity for your region.

Adding insulation to exterior walls doesnt have to be a big remodeling project. Much of the time, it can be blown into walls by a contractor.

Use a Programmable Thermostat

These thermostats make a home more energy efficient in the following ways:

  • You wont have to remember to set the temperature lower or higher before you run out of the house each the morning, because you can program the thermostat to do it for you each day.
  • You can program different energy-saving temperature settings for special occasions, such as vacations, and you can still come home to a comfortable house.
  • Some new thermostats even allow you to check them remotely, sparing you from worrying about whether the home is getting too hot or cold while you are away.

By implementing these ideas, you have little to lose and a lot to gain in terms of comfort and savings. If it feels overwhelming or it is hard on your budget to make all of these changes at once, try to do them in steps. Each time you take even one step towards more energy efficiency, you will start saving money on energy bills.


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Why You Should Buy an Investment Property First and a Home Second

If yoursquo;ve come to a point in life where you have saved up enough cash to put down on a house, it is the smarter financial move to buy an investment property and not a home. You are better off investing your money in a rental property, which will make more money for you while continuing renting. In a few yearsrsquo; time, you will have enough cash to not only buy the home of your dreams, but to also grow your real estate investment portfolio with another rental property.

Letrsquo;s have a look at the reasons why you should buy an investment property first and only then buy your own home:

1. Financing the Purchase

Most people have to take a mortgage loan when buying a home. Very few are lucky to have enough money in the bank to pay in all cash. Moreover, the majority of lenders other than traditional banks and a few government programs are hesitant to lend money to homebuyers as they donrsquo;t have a guarantee.

The situation is different with real estate investors. When buying a rental property, you are not limited to a conventional loan, but can also finance your property purchase through hard money lenders, private money lenders, crowdfunding, syndication, and other forms of partnerships. You have more options to get creative with financing as the rental income yoursquo;ll make from the property will help you pay off your loan faster and more efficiently.

In a sense, when you invest in real estate, it is your tenants ndash; and not you ndash; who make the monthly loan payments. So, month after month, you grow equity in your property without paying from your own pocket. Actually, your renters pay for all other recurring expenses such as property tax, insurance, maintenance, utilities, etc. as well. Thatrsquo;s one of the most important reasons to go for an investment property before purchasing a home, where you will be the one making all the payments.

2. Making Money in the Short Run

As a real estate investor, you should only buy positive cash flow properties. For this purpose, you have to conduct careful investment property analysis before deciding on a property. With positive cash flow properties, tenants not only make the monthly mortgage payments to the bank, but also make you money. Any part of the rent which doesnrsquo;t go towards the ongoing rental property expenses comes straight to your pocket in the form of profit. Indeed, as long as you buy a profitable property in the right market and manage it reasonably, rent is the most stable source of income out there. Moreover, you can start making money right away ndash; all you need is a property in a condition which allows to rent it out.

If you decide to buy a home instead, you donrsquo;t get to make money. Of course, you can say that if you continue to rent the place where you live, you will have to pay rent to the landlord, so you are losing money. The trick is to buy an investment property which brings you more cash than your own rent. You can do that by finding a profitable property type in a strong investment market.

3. Making Money in the Long Term

As a real estate investor, your goal is to make money. A rental property helps you achieve this goal not only in the short term but also in the long run. Once your housing market has experienced enough real estate appreciation, you can sell your investment property. The price you receive for it will be much higher than what you paid for it a few years ago.

Natural appreciation is one of the most important benefits of real estate investing. Thanks to it, you get to make money without putting any efforts into your property. All you have to do is to assure that you maintain it well.

This is different from selling your home. While you can easily sell your investment property to buy a bigger one or to buy two rental properties instead, selling your own home is a very emotional decision, which few will take upon.

4. Having No Limits on the Market

If you are buying a home, you obviously have to choose a property in your local housing market or within a few miles from it. This doesnrsquo;t make much sense in a high price to rent ratio market, where property prices are too high compared to monthly rental rates. For example, the price to rent ratio in Miami is really high at 29. The average monthly rent is 1,740, while the average property price is 616,000. Such a property price is not something which everyone can afford. In such a housing market, speaking from a pu>

At the same time though, if you are buying an investment property, you are not limited to any particular market. With the advancement of professional property management companies, out of state real estate investing is becoming an ever more popular option among property investors. With real estate investments, the sky is the limit. You can find a housing market with high rental demand and >

5. Facing No Restrictions on the Property Type

When you buy a home, you have to take care to choose a property which will serve your needs for decades to come. If you have a family or are thinking of starting one, you better go for a single-family home which will have enough rooms and space for your growing family. This limits the type and number of properties you can purchase in the local market. Not to mention that single-family homes cost significantly more than apartments or condos, letrsquo;s say.

If you are buying an investment property, however, you can choose any property type, as long as you can afford the down payment. This gives you significantly more options and opportunities to find a property within your budget.

6. Benefiting from Tax Deductions

When you buy a home, you have to start paying property taxes. This is not to say that you donrsquo;t have to pay taxes if you buy real estate for investment purposes. To the contrary, you have to pay property tax and income tax as well, but you can get tax deductions on many of your business expenses such as travel, office space, utilities, and others. As a real estate investor, you should utilize every opportunity to increase your cash flow and return on investment, so make sure to study all available tax deductions carefully as they apply to your particular situation.

Even if yoursquo;ve spent all your life to this point hearing how important it is to buy a home, you should keep your mind open and realize that this is not necessarily the best decision from a financial point of view. As a matter of fact, buying an investment property makes more sense. If you do your market research and property search well to land a positive cash flow property, you can start making and saving money from month one while growing your equity in your rental property. In this way, your investment property will help you save up enough money soon to buy the home of your dreams.


Daniela Andreevska is Marketing Director at Mashvisor, a real estate analytics tool which helps real estate investors quickly find traditional and Airbnb investment properties. A research process thatrsquo;s usually 3 months now can take 15 minutes. We provide all the real estate information in easy to understand visualizations.


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Learn to Laugh at Yourself

Maybe you said something in a sales meeting that was misunderstood that got a big laugh. Maybe you dropped a dessert in your lap at the company party and everyone laughed while you sat mortified, or you forgot how to open an MLS-locked door, with just your prospects watching.

How you respond when something happens to you can make or break the sale.

The two most embarrassing incidents of my career happened on the same day in front of the same prospect, the Chairman and CEO of the largest lender in the southeastern United States and four members of his senior management team.

I had been asked to make a presentation to become the exclusive marketing consultant for an unknown number of real estate developments they could or would soon own through foreclosure.

This was the opportunity of a lifetime, and I knew I was the man for the job. By the end of the day, I wanted to foreclose on my own career.

In one day, I spilled a cup of coffee on my new white shirt right before my presentation, and my suede coat caught on fire at the lenderrsquo;s Christmas party while talking to the chairman.

This opportunity was a huge one for a 43-year-old Realtor trying to survive in a world with fixed mortgage rates at 20 percent. I was dressed to the nines and poised to make a great first impression.

There was no doubt in my mind that I was the man for the job, and that I would get the business. I had the experience, track record, and wearing a new shirt with cuff links. lsquo;Confidentrsquo; does not begin to describe how I felt. At first.

I was seated on one side of the conference table drinking a cup of coffee waiting on the chairmanrsquo;s arrival through the door facing me. As he walked in, I stood, leaned across the table, shook his hand and sat down.

Before everyone was seated, I happened to notice a huge coffee stain on my shirt, which from my vantage point seem to spread from my shirt pocket to my belt and across my stomach.

I had dragged my tie through my coffee when I leaned across the table to shake the chairmanrsquo;s hand

Now, instead of listening to what he was saying, I was thinking to myself ldquo;How can I prove that I am not a complete and total slob?rdquo;

What would you have done?

Here is what I did.

I fakednbsp; an upset stomach and hurriedly excused myself as if going to the menrsquo;s room. What I really did was run across the street to a menrsquo;s store, purchase a new shirt and tie, put them on and run back to the meeting. It didnrsquo;t take five minutes.

I apologized but explained I was feeling better, trying hard not to breathe too heavily. The meeting went well, but I was a wreck. The CEO and other executives couldnrsquo;t stop grinning at me during the meeting, which I assumed was their overwhelming approval of my presentation.

At the end of the meeting, the chairman asked if anyone had any questions. No one did, but he said he had one.

Turning to me he said, ldquo;Fletcher, how did you do that?rdquo;

ldquo;Do what?rdquo; I asked.

ldquo;How did you get the coffee stain off of your shirt?rdquo;

By this time the room was rolling with laughter, as I haltingly explained what I had done. It was by far the most embarrassing thing to ever happened to me in a business meeting. But that claim was about to be negated by what was about to happen in front of 400 people later that same day.

I had been invited by one of the lenderrsquo;s board members to the lenderrsquo;s Christmas party that same night, which I haltingly attended because I did not want to replay the coffee saga with the CEO and his management team.

As we were standing around the buffet table enjoying our food and replaying the coffee stain saga, the executive vice president commented that he smelled smoke.

All of a sudden, the chairman said, ldquo;Hey, Fletch, your coat is on fire.rdquo; It seems that I had my elbow in a candle flame as I held my food plate. My coat was not on fire, but it was seriously scorched.

They started laughing so hard tears were coming down their faces. Irsquo;m thinking, ldquo;There has got to be cave I can crawl into and never come out of around here somewhere.rdquo; The only thing I knew to do was smile sheepishly and go along with their fun as the other 400 people at the party joined the CEO and his staff wondering, then discovering what happened. The words ldquo; crowd uproarrdquo; comes to mind.

On the way home I thought about quitting real estate altogether. When I got home I told my wife I had lost the business. There was no way they would hire someone who spilled coffee on their shirt and stuck his arm in a lighted candle. I was done.

I knew I would never get their business. I was wrong. One of the officers called the next day with the good news.

The result: I became the exclusive marketing consultant/or broker of record fornbsp; 27 lender properties over the next 3 years and the source of laughter with the client every time we talked.

Looking back, I believe it was the very day I felt the most like quitting that my career took off.

The Lesson: Moments such as these that show the real you and how you respond to the unexpected. Laughing it off works in most cases.


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Payroll Numbers, Wage Gains Much Stronger Than Expected: Higher Rates Ahead?

Well, this was certainly a surprise. The first business Friday of each month is when the Labor Department >

The more important number from the Labor Department report is how many new jobs were created in December. Analysts were expecting a solid number but something closer to 177,000 new jobs. Instead, the number of new jobs hit 312,000. Thatrsquo;s a lot. Further, wage gains increased by 3.2 percent which is the fastest pace in nearly nine years. With more money in consumerrsquo;s pockets that can help keep an economy rolling as consumers feel more confident about their jobs and their financial position.

Okay, so does all this tell us about the future of mortgage rates? The Federal Reserve hiked the Federal Funds rate by 0.25 percent in December. In November, Fed Chair Powell reaffirmed there could be two more such hikes in 2019 but didnrsquo;t make as strong of a commitment to the move as with previous comments. And on January 4 of this year, Powell said the Fed lsquo;will be patientrsquo; with monetary policy as it sits back and watches how the overall economy performs.

While the Federal Reserve doesnrsquo;t affect your standard 30 year fixed rate it does provide investors with guidance on what the economy may do in the future. That standard 30 year fixed rate is tied to a specific bond and just like any other bond, when there is a greater demand for a bond, the yield falls. Investors donrsquo;t buy bonds for a large return but instead is a safety channel from uncertain equity markets. When the economy is buzzing right along, investors will tend to sell bonds and allocate more money into stocks.

This tells us that if this trend continues, we will in fact see higher mortgage rates ahead. There are those that are pointing out this strong jobs report is unsustainable and there are other recent economic reports that show some weakness in the economy and the stock boom will be short lived. If thatrsquo;s the case, while rates might be higher soon, they wonrsquo;t be as high as the December jobs numbers would indicate.


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Affording a Home Requires Compromises - but Families Are Okay with That

In a perfect world, the overwhelming majority of young urban Canadian families would purchase a single-family home in move-in condition with a nice yard and a garage. In the real world, affordability issues require families to make compromises when they purchase real estate -but theyrsquo;re okay with that.

A survey of urban families where the adults are ages 20 to 45, conducted in Canadarsquo;s four largest cities, found that although 83 per cent of young families still aspire to own that singe-family dream home, only 56 of those surveyed actually purchased one. The others bought attached homes, a duplex/triplex/multiplex unit or a condominium. Despite making compromises to get into home ownership, 93 per cent of families are satisfied with their purchase and 78 per cent believe their investment will outperform or match their financial investments during the next five years.

The survey was conducted by market research firm Mustel Group on behalf of Sothebys International Realty Canada.

ldquo;Young families are much more influential in Canadarsquo;s metropolitan real estate markets than many realize. With 9.1 million Canadian millennials now entering the partnership, marriage and parenting stages of the family life cycle, the ranks of these modern families are swelling,rdquo; says Brad Henderson, president and CEO of Sothebyrsquo;s International Realty Canada. ldquo;Our research dispels several urban myths about the housing preferences of this group. It suggests that the wave of demand for single-family home ownership will continue to rise in spite of mounting affordability challenges. Moreover, it highlights the fact that cities will continue to face significant pressure to overcome these challenges with solutions that go beyond the addition of higher-density housing.rdquo;

The survey found that 43 per cent of families that have already purchased real estate have abandoned the idea of buying a single-detached home because of affordability issues, while 39 per cent still plan on purchasing one in the future.

RBCrsquo;s December 2018 affordability report says that rising interest rates in 2019 will ldquo;keep upward pressure on ownership costs. Softening prices in key markets and rising household income increases will provide some offset, however.rdquo;

RBC says the mortgage stress test, which requires borrowers to qualify at a higher rate than their offered rate, has added almost 36,000 to the qualifying income needed to buy an averaged priced home in Vancouver. In Toronto it has added 27,000.

The impact of the stress test has been felt across the country, but outside of the major cities, RBC says owning a home remains affordable in most other markets.

The Sothebys survey asked what modern buyers are looking for when buying a home. Value per square foot was the No. 1 answer, followed by the home being move-in ready and requiring little renovation, and having the desired number of bedrooms. Twenty-six per cent of respondents were looking for a newer home five years or less, while having an open-concept kitchen/dining/family room layout was important for 14 percent of those surveyed.

In Vancouver, having an existing or potential rental suite in the home was important to 11 per cent of respondents, but that was less important in Toronto, Montreal and Calgary. Buying a home with smart home technology such as an electric car charger was cited by only one per cent of respondents.

Just 18 per cent of families said they didnrsquo;t have to make any comprises when they purchased their home. The compromise cited most often was going over budget. An equal number said the home required more renovation work than they would have preferred, and the property was older than desired. Some buyers got less square footage and yard space than hoped for, and 17 per cent decided on a location that was farther from downtown than they wanted.

But 95 per cent of Toronto families and 94 per cent of Montreal families said they are either ldquo;veryrdquo; or ldquo;somewhatrdquo; satisfied with their purchase. Ninety-one per cent of families in Calgary report some satisfaction and 90 per cent of Vancouver families are satisfied.

The survey was conducted from August 9 to September 9. Despite flattening real estate prices, most buyers are confident with the investment value of their purchase. Seventy-eight per cent of respondents say they think their home will outperform or match the performance of their financial investments in the next five years. Forty-eight per cent say real estate will outperform other financial investments.

One-third of the properties purchased by respondents were over 2,000 sq. ft., with 24 per cent between 1,000 and 1,499 sq. ft; 22 per cent between 1,500 and 1,999 sq. ft.; and 21 per cent with less than 1,000 sq. ft. Three-bedroom, two-bathroom homes were the most commonly purchased home. Eighty-three per cent had two or more bathrooms.


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Time to Move to Los Angeles: City Unveils Early Earthquake Alert System

In a >

Those who have avoided Los Angeles for fear of an impending earthquakemdash;or simply lived with the fear of overstressed faults and grinding tectonic platesmdash;may be able to make those plans to move, or breathe a little easier from their So Cal home.

ldquo;Los Angeles has unveiled its long-anticipated earthquake early warning app for Android and Apple smartphones, which is now available for download,rdquo; said the Los Angeles Times. ldquo;ShakeAlertLA, an app created under the oversight of Mayor Eric Garcetti and the city, is designed to work with the U.S. Geological Surveyrsquo;s earthquake early warning system, which has been under development for years. Itrsquo;s designed to give users secondsmdash;perhaps even tens of secondsmdash;before shaking from a distant earthquake arrives at a userrsquo;s location.rdquo;

According to the app, a 5.0 or greater earthquake in Los Angeles County triggers an early warning, ldquo;often before you feel shaking,rdquo; that is sent out to smartphones. These ldquo;precious secondsrdquo; are critical, said Garcetti, allowing people to ldquo;stop elevators, to pull to the side of the road, to drop, cover and hold on.rdquo;

ShakeAlert makes Los Angeles the first city in the country with a public early warning system; more widespread use across California is in the works through Early Warning Labs, a Santa Monica-based company developing an app called QuakeAlert. In addition, ldquo;Hunter Owens, the cityrsquo;s data scientist, noted on Twitter that the apprsquo;s code has been made open-source for other cities or states to use,rdquo; saidnbsp;Curbed.

ldquo;For more than a decade, the USGS has worked with a group of universities and research institutions to secure funding and build out the sensor network for the ShakeAlert program, which distributes the seismic data to the City of L.A.rsquo;s app. The initial goal of the ShakeAlert system was to create an early warning system for the entire West Coast, but federal dollars to pay for development were repeatedly zeroed out during budgeting,rdquo;

The L.A. Times notes that, while not perfect, early warning systems ldquo;helped prevent deadly derailments of high-speed trains in Japan before shaking arrived from the magnitude 9.1 earthquake of 2011, for instance, signaling the trains to slow down. Memorably, the national Japanese broadcaster NHK aired an earthquake warning about 90 seconds before the strongest shaking arrived in Tokyo. Warnings that buzzed in >

According to one study, people in the epicenter of the Japan quake had a 15- to 20-second head start to find safety before the heaviest shaking occurred.


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How To Keep From Going House Poor

A few smart strategies can help you avoid becoming house poor.

Think hard about that preapproval amount

Just because the bank tells you that you can buy a 400,000 home doesnt mean you have to spend all 400,000. It might be that youre not comfortable with a payment that high if it means you wont have a cushion and cant continue to contribute to your savings.

Things youll want to consider:

Can you continue to invest the way you want to?

Will you be able to keep up or build your emergency fund - "A savings account stuffed with six months expenses or more is a vital part of financial stability," said Money Under 30.

Are you going to have enough money left over to establish a bank account buffer? "Whether youre 15, 25 or 65, if youre having trouble with your money and want to improve, the very first step you should take is to build a bank account buffer," said Money Under 30. "A bank account buffer is my name for what other people may call a cash cushion, mini emergency fund, rainy day fund or back-up savings. When you have a bank account buffer in place, you dont have to worry that a poorly timed Starbucks break you charged to your debit card will overdraw your account and trigger a 35 overdraft fee."

Calculate your ENTIRE payment

Principle and interest will only tell you part of the story. Same with principle, interest, taxes, and insurance. If youre not also taking into account any Private Mortgage Insurance you need to pay, your Homeowners Association fee, and any special assessments, youre not looking at the whole picture.

Budget for additional expenses

This is not the place for that buffer referenced above, but, rather, a way to make sure you can really handle the home you want without living paycheck to paycheck or, even worse, going into even more debt just so you dont sink. If you dont currently have a yard or are renting, you may not be accustomed to paying landscaping fees. If your new home has a pool, dont forget to budget for that pool cleaner. If youre moving to a larger home, you may also have an increase in costs for your house cleaning service and utilities, and if your commute is longer, you may be paying more in gas and tolls. They are the little things that can creep up and affect your bottom line.

Dont do improvements right away

You might want to wait a few months to see how your expenses pan out before you empty your savings on a new kitchen. Ditto for buying a houseful of new furniture. The desire to fix up the house to your standards or pack it with all-new everything is strong. But a little patience can go a long way. Spreading out your purchases while you increase your savings and waiting for sales and zero interest credit offers can help keep your budget in check.

Be careful with an equity line

Having equity in your home is great if it means you made a smart investment. But using it irresponsibly can quickly make your budget spin out of control. The good news is that, according to Co>

Get a home warranty

Experts are on the fence about thismdash;some say you absolutely have to have one while others find it a waste of money. But if youre the type for whom coming up with thousands of dollars to replace the faulty air conditioner thats no longer conditioning anything or a refrigerator thats stopped refrigerating will be a hardship, the minimal monthly output is far outweighed by the peace of mind of knowing most of your large repairs will be covered.

Claim a homestead exemption

In some states, you can file a homestead exemption to lower your property taxes. Savings can add up to hundreds of dollars per year or more. You can get more information and learn whos eligible here.

Change your tax withholding

One of the great benefits of homeownership is the tax writeoff. If you leave your withholdings alone, you may expect to get a big chunk of money back at the end of the year, as long as nothing else has changed. But by adjusting your withholdings, you can hold on to more of your money every month to help offset higher expenses.

After you buy a home, "payroll withholdings should also be reexamined and, perhaps, reduced to account for the reduction in net tax liability," said HGTV. "Talk to your tax preparer or use the IRS withholding calculator, to get the numbers right."


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This Anti-Theft Device for Homes Could Be a Game Changer

While whatever security measures you had in place to keep the burglars out may have failed here, you now have a better chance than ever of getting your things back, thanks to a cool new product from ProTech DNA called DNA for Property.

And, the best part is: Itrsquo;s free, courtesy of the insurance industry, who was smart enough to see the advantage of underwriting the product instead of having to pay to replace their customersrsquo; stolen stuff. After all, according to safewise, ldquo;More than five million thefts occur nationally each yearrdquo; Thatrsquo;s a lot of money out of pocket for you, if yoursquo;re a victim of theft, and for the insurance company who has to pay out a claim.

National investigative correspondent Jeff Rossen profiled the product on TODAY, demonstrating how it can greatly increase the chances that burglary victims will get their stolen items back. ldquo;In many cases, once police have recovered the items, its difficult for them to determine the rightful owner,rdquo; they said.

This anti-theft kit is poised to put an end to that problem; the product is a game changer that uses DNA to ldquo;tagrdquo; your things. According to the company, DNA for Property is a ldquo;forensic marking solution that will put your unique identifier on all your valuables. Each Dot is made of nickel, and has a unique PIN Personal Identification Number. The glue/adhesive contains a UV trace that will glow under a black light.rdquo;

So far, more than 5,000 police departments across the country have partnered with the company, with another 1,000 being added each month, creating a widespread national anti-theft system.

Each kit comes with enough gel to tag about 100 items, so you donrsquo;t have to play Sophiersquo;s Choice with your possessions. Safewise has a good rundown of the most likely items to get stolen in a home burglary to assist you in choosing what to include. Their No. 1: Cash. While yoursquo;re probably not going to mark every dollar bill that comes through your home, this is a great reminder to tag your stash of emergency cash or any bundles you keep in a safe or other presumably secure place in your home while yoursquo;re marking your laptops, TV, and art pieces.

You can get your free DNA kit from their website.


Full Story >


Written Contracts are Important in an HOA?

Answer: Yes, I have a number of suggestions and recommendations.

The first thing you should remember is that the Board is -- or must be -- in charge of the operations of your Association. You >

Furthermore, the fact that you have been using the same contractors each and every year does not mean you should continue the status quo.

Ask your property manager to prepare a list of all existing contracts. It can be in a form, which would look something like this:

Contractornbsp; nbsp; Brief Summary of Servicesnbsp; nbsp; Costnbsp; nbsp; Termination Date

This list should be updated at least quarterly. Furthermore, the manager or your association attorney should review each contract to determine how these contracts can be terminated, and whether these contracts will automatically continue unless advance notice is given to the contractor.

Then, at least two months before a particular contract is about to expire, the manager should solicit at least three bids from potential contractors. The manager should prepare a brief summary of each bid, and make a recommendation to the Board. But the Board -- and only the Board -- should make the ultimate decision. And make sure you currently have the right to cancel the existing contract should you opt for a new one.

This highlights perhaps the most important point of this article: you must have a written contract for every contractor that your Association uses.

Why? Because you want to know -- in advance -- exactly what services the contractor will provide, what the cost will be, and how you resolve disputes should they arise.

This is not a hypothetical situation. Our office has handled hundreds of contractor disputes, ranging from dissatisfaction with services, arguments over the scope or quality of the work to be performed, to questions of how much the contractor should be paid.

Why take a chance and >

l. Dispute resolution procedures. Should you agree to arbitrate any disputes or do you want to go to Court? My personal belief is that although arbitration is clearly faster and usually less expensive than litigation, the arbitration process is not in the best interest of most associations. Often, the arbitrator "splits the baby in half", without regard to the merits of the case. Usually, the arbitrator does not allow either side to obtain discovery prior to the hearing. In any event, if you decide that arbitration is the best route for your Association, the following clauses should be included in the contract:

a. The arbitrator will issue a written opinion;
b. The arbitrator shall award attorneys fees and costs to the prevailing party.

2. Payment schedule. You want to spell out in writing exactly when the contractor will be paid, and under what circumstances you have the right to withhold payment.

3. Provisions for final payment. Make sure that a professional has inspected the work when the job is finished, and that the Association obtains a >

4. If you are doing a big job, you should consider hiring a project engineer or architect. This person will be a buffer between the Association and the contractor, and will have to approve the work before payments are made.

5. Make sure you limit the hours of the contractor. You do not want to have concrete blasted at 6 a.m. on a Sunday morning, but you do want to make sure that a heavy snowfall is plowed early in the morning. Also, all contracts should require the contractor maintain appropriate licenses and insurance.

This article cannot cover all of the important legal aspects, which must be included in any contract. You should review your procedures with your attorney and your property manager.


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