webLOGfor.US

     We generally expect some things to be wrong when turning over tenants.  I know I expect painting to need to be done if it is more than 2 years since the tenant moved in.  This tenant was in the place just shy of 2 years and all the walls needed repainting.  They also needed a good scrubbing.

      There were some repairs that they had done such as a new bedroom door.  I was told that one of the tenants put their hand through the door because it had been sticking.  Either way, the new door is nice.  Unfortunately there are issues.  First, the casing around the door was damaged when they went to replace it.  Second, when they were removing the old door it looks like a chunk of the header was ripped off.  Nothing that would be structural to repair, but definitely cosmetic as the all the wood is stained and not painted.

      2 areas of rug had to be steam cleaned, the back bedroom and the upstairs hall.  The movers put a decent sized ding in the ceiling that needed repairing, etc.  The bulk of the items were small.

      One big issue I had was with holes in the wall from nails.  They were proactive in that they attempted to fill the holes.  Doing the final inspection I saw that the repairs needed to be sanded and I could have filled it better myself so it would not have needed sanding but they get an A for effort.  Long story short the A turned to an F when I went to sand the stuff.  Whatever they used never cured.  It remained pliable like chewing gum.  I ended up digging all the stuff out of the holes, sanding what was stuck on the walls with my orbital sander then refilling the holes.  What would have been a 20 minutes job if they left the holes turned into about 3 hours.  Not fun.

      The other big item I have had trouble with was deodorizing for a cat.  I know, I normally have a no pets policy.  This tenant was good and worth it that I decided to take the chance on pets.  The cat apparently liked the storage room…a lot.  It became the litter box from the smell of it.  Anyway, I have had success in the past with Odorcide 210 for pet odor removal.  One treatment didn’t get rid of the odor so I gave it another shot.  I’ll be heading back today to see how the smell is.

      All in all I ended up with more damages that I expected.  I am sure they will also be surprised by the number of charges on there.

Allentown PA has taken a unique approach to trying to get landlord's take responsibility for the appearance of their properties.  They have a website dedicated as a Landlord Hall of shame.  They've also taken to sending news releases to the local paper of the landlords if they live out of the area.  It'll be interesting to see if this has any effect on the landlords.

Allentown to shame landlords into property cleanup

ALLENTOWN – Allentown's mayor is putting landlords on notice. They'll have to clean up their properties or face public humiliation.
Mayor Ed Pawlowski has unveiled a Landlord Hall of Shame.
It's aimed at publicly embarrassing landlords into action when issuing code violations doesn't work.
Inductees' names, phone numbers and home addresses will be posted on large signs attached to their properties so neighbors can call and demand action themselves, according to WFMZ-TV.
If the landlords live out of the area, the city will send news releases to their hometown newspapers. If that doesn't work, the city will purchase advertising space to ensure that the public shaming reaches into their own neighborhoods.
Allentown has established a page on its Web site dedicated to outing neglectful landlords.

View the Landlord Hall of Shame here

When you are going to be in business for yourself, you need to learn the laws controlling that business.  One of these important laws is the EPA's Lead Based Paint Disclosure Program.  There is a pamphlet that is to be given to tenants.  You can find the pamphlet here.  In addition you can find the disclosure here.  Finally you can find the FAQ from the EPA here.

Why do I bring this up you ask?  It was this article that made me give the warning.

(10/7/2008 — SAN FRANCISCO) The U.S. Environmental Protection Agency has fined a San Francisco-based property owner $25,410 for alleged violations of federal lead-based paint disclosure requirements at eight rental properties in Sacramento, California.

“Property owners take note: The EPA takes seriously its responsibility to ensure that renters and buyers receive the information they need to protect children from potential lead-based paint hazards,” said Enrique Manzanilla, director of the EPA’s Communities and Ecosystems Division for the Pacific Southwest Region. “This enforcement action is an example of the EPA’s commitment to enforcing toxic substances regulations to protect public health — especially children, from potential lead-based paint hazards."

Residential property owner Joseph Lueras did not provide federally-required lead warning statements to his tenants before he leased them pre-1978 housing units located in Sacramento, California. He also failed to disclose any knowledge or reports pertaining to the existence of lead-based paint in those units or else indicate that he had no such knowledge or reports. These failures resulted in multiple violations of the federal Toxic Substances Control Act.

Between August 2002 and March 2006, Lueras owned and leased various residential rental units located in Sacramento, California at 4208 55th Street and 1823 T Street.

It is estimated three-quarters of the U.S. residential dwellings built before 1978 contains some lead-based paint. Lead poisoning in children can have serious, long-term consequences including intelligence deficiencies, learning disabilities, hearing impairment, hyperactivity and/or behavioral problems.

Federal law requires that persons and entities who sell or rent housing built before 1978 must provide an EPA-approved lead hazard information pamphlet; include lead notification language in sales and rental forms; disclose any known lead-based paint hazards and provide reports to buyers or renters; allow a lead inspection or risk assessment by home buyers; and maintain records certifying compliance with applicable federal requirements for three years.

Children younger than age six are among the most vulnerable to adverse health risks from lead-based paint. The Residential Lead-Based Paint Hazard Reduction Act helps prevent exposure — especially the exposure of children — to hazards from lead-based paint by requiring disclosure and notification when selling or leasing applicable housing.

Everyone was so used to the seller's market of the past few years that they are having a hard time accepting the realities of the buyer's market we are in today.  Gone are the days of bidding wars for properties and selling your property within hours of it being listed on the market.

Homes are now sitting on the market longer and sellers need to make concessions to sell their house.  Many people are just starting to realize that they cannot ask for $10,000 more than the last house to sell in the neighborhood.  The people looking for houses today know what they want.  They weren't caught up in the frenzy of the buyers market.  They played the waiting game and are smart buyers.  They are looking for the best value for their dollar.  To sell a house quickly today you need four things.

Expert Help:  I am true DIY person at heart.  When it comes to selling your house I think that most people need help.  one main reason i feel this way is that there is a lot of money at stake and things need to be done in a very careful manner.  This is one area where having an expert on your side helps.  Realtor's will help with pricing and Real Estate attorneys will help protect your interests in everything.

When choosing a Realtor remember to interview at least 3 Realtors and watch out for the sales pitch.  Talk to them and pick the one that you feel will get you the best value.  Notice I don't say price.  You need value here which is much different than price.  Value can be measured in how much time you house is on the market, how smoothly the deal goes through, etc.  Look for things like client references, experience in the area, time in business, personality, etc.  It won’t matter if you get an extra $2,000 for you house if the closing is delayed, it takes an extra month to sell, or the buyer backs out because of a problem your real estate agent caused.

Proper Price:  I listed this first because it is the number one thing.  People have a personal attachment to their home.  This causes a skewed perception when it comes to value.  Talk to a professional about pricing your house.  Have them pull comps, review them with the Realtor and come up with a realistic price based on your house versus the comps.  Don't let emotion come into play.  When it comes to selling your house, Michael Corleone said it best "It's not personal, Sonny. It's strictly business."

Good Shape: To sell a house today it has to be in good shape.  Only some people are looking for fixer uppers and if you have things that need to be fixed you will limit the pool of buyers who your house will appeal to.  We want to market te house to the most people as possible.

Proper Staging:  You don't have to get your house professionally staged, but follow the general rules of staging.

• Less is more.  Remove the clutter both in the living and storage areas.  Don't forget the closets.
• Keep it lit.  Proper lighting is key.  Accent the nice areas of your house.  Keep rooms well lit.
• Depersonalize.  Remove personal photos, etc.  You want the potential buyers to picture themselves in the house not reminisce in your memories.  Make your furniture look cozy, but don’t put too much in one room. Your most attractive piece of furniture should be placed on the wall you see when you enter a room if possible.  Remove all CD’s and DVD's.  Hang pictures at eye level or in geometric shaped groupings.  Accessories should be placed in odd numbers, one, threes or fives.  Use a flower arrangement, mantle clock or piece of art on a fireplace mantel in place of personal items.
• Cleanliness is next to Godliness.  Keep the house clean.  Pay particular attention to the kitchen and bathrooms.  Clean the grout, remove any mildew fro the bathroom.  Keep counter space clean and clear of all items.  Remove all notes, magnets, etc. off the front of the fridge. Organize the shelves and drawers.
• Fresh Paint.  A Fresh coat of paint in a neutral color tans, sages, and beiges are good choices.  Use accessories, pillows, rugs, candles to add color and interest.
• First Impressions.  You only get one chance to make a good first impression.  Curb appeal is it for your house.  Make sure the exterior of the home is in good shape.  If there is chipping paint, repaint.  If the shrubs need trimming, do it.  Plant some flowers to give a welcome to guests.  Declutter here as well by making sure everything is cleaned up.  Nothing should detract from the beauty of the home.  The lawn should be cut and well watered for a nice green effect.  The pool, if you have one, should be cleaned.

While nothing can guarantee a fast sale for your home, if you follow these guidelines you will have the best chance to sell you house quickly.  Good Luck!

As people who read this blog may know, I am a contributor to the Yahoo! Answers message boards.  I have seen many questions come up on should I let my home go into foreclosure or not lately.  I'm posting one question here along with my answer to that question.

Question:  I have had a fixed rate mortgage for the past 5 years and it is set to start adjusting soon.  I spoke with my mortgage broker and he said that my payment will go up by about 40% at that time which I can't afford.  He ran some comps and told me that I owe about $100,000 more for my house than it is currently worth.  His advice was for me to buy a new, cheaper home now then stop paying on my current mortgage and let the home go into foreclosure.  Should I walk away from my home since I can't afford it and I am upside-down on my mortgage?

Answer: Absolutely Not! The only thing you should walk away from right now is your mortgage broker.  The advice you are getting from him is clearly not the best around.  I see a possibility for you to benefit on this (by getting out of the mortgage) and I see him definitely benefiting on this (since he will get to sell you a new mortgage).  My first thing to look at here would be how did you end up in this situation?  Was it the mortgage broker who steered you toward this type of loan?  If so, ask him why he did it.  If not and it was you who were going for more home than you could afford then you need to take responsibility and fix the problem.  Walking away from it is not fixing it.

    First, let me say that it is great that you are conscious of your mortgage and trying to resolve any problems before they hit you in the face.  I’ve seen far too many people just sit back and not take action until it is too late.  Those people who wait until the adjustment has already happened end up in desperation and panic.

    Owning a home brings with it a great deal of responsibility, and if you are sufficiently mature to own a home then you are certainly mature enough to deal with the consequences of some questionable mortgage decision-making. There are many options you have for proactively dealing with your coming mortgage adjustment short of abandoning your home to foreclosure.  It would be a major step in the right direction for your relationship with money and your personal financial and emotional maturity for you to take responsibility for the consequences of your past decisions and pursue those options before throwing in the towel.

    Your mortgage broker's advice is intended to position you against the worst-case scenario.  I would suggest you try to project the best-case scenario and do everything in your power to manifest that outcome.  That requires a big mindset shift, but I've seen homeowners do it, and end up keeping their homes or selling them — both of which are preferable options to walking away.
Foreclosure is your worst-case scenario.  The cost of a foreclosure is greater than just losing your current home.  Foreclosure has tentacles that reach into many other places in your life.  Whether you walk away from your house or try to resolve things with your lender, foreclosure will result in a major decrease in your FICO score.  This drop in your FICO score will be large enough to prevent you from buying another home for several years and to cause your credit card companies to start closing your accounts.  Additionally, many landlords now look at credit reports when gauging the acceptability of prospective tenants.  If you allow your home to go into foreclosure expect to have your current credit reduced and be denied future credit for many years to come.

    The answer to this is not to simply buy a new home ahead of time; frankly, if you are that overextended, I'm not sure how feasible it is for you to obtain financing on a home right now, and it is a morally reprehensible to plan so strategically to abandon your obligations under one mortgage and attempt to avoid the consequences of doing so in one fell swoop.  When you accepted the mortgage, you accepted the responsibility for paying back a loan.  The home was just used as collateral.

    The ethically, morally and responsible move is to put into play a foreclosure avoidance plan, and then work that plan. There are homeowners out that are having success avoiding foreclosure.  You should join their ranks and follow your plan to avoid foreclosure before just throwing up your hands in defeat.Homes are not disposable. The fact that you currently owe more on your home than it is worth is not sufficient justification for abandoning your home. I know many homeowners who once were upside down, but stayed in their home for another 10 or 20 years, and now that same home is worth three or four times what they paid for it. Homes are items that appreciate over a long term.  This is one reason that mortgages are tied to security terms and not the short-term rates that the fed adjusts.  Take a long-term view on the value of your home, and don't toss it away like you would a bad stock; unlike those shares, your home's value will usually come back over time.

Here are some things to do to get things rolling and keep yourself from having a foreclosure.

1. Try to refinance. If you are worried about being upside down on your home you might need to assess how sustainable this home is for you. If you simply bought way more home than you can ever realistically afford with a reasonable mortgage, you should jump straight to #3 and try to sell your home. If other events, like a temporary loss of income, are making it difficult for you to afford your home now but you think you can afford it over the long haul, work with an ethical mortgage broker (obviosuly not your current broker) to see if it makes sense for you to refinance your mortgage, and whether any affordable mortgage options that are sustainable over the long term are available to you.   
2. Loan modification. Call your lender!! Ask for the loss mitigation department; put together the hardship package they request (usually a bunch of your financial paperwork to show that you really can't afford the upcoming adjustment); and then try to negotiate a few months with no payment, a reduction in the balance of your loan based on fair market value, an extension of the low-payment period for several more years, a reduction in interest rate, etc. Lenders vary widely in their amenability to making these sorts of arrangements.
3. Get extreme about increasing your income. If you truly want to keep your home, consider going to extremes. I've seen people avoid foreclosure by renting out rooms, taking second jobs or taking in freelance work on the side.  
4. Short sale. If you just bought way more home than you can ever realistically afford, trying to liquidate your home through a short sale is a great option. Work with a Realtor who has experience successfully representing sellers in short sales. I've even seen homeowners have real estate investor friends purchase their home through a short sale, which may give the seller the opportunity to lease and later buy the home back.    

    Responsibility is the ability to respond, not the ability to run from your problems. The savvy way to respond to your situation is to exhaust the above ethically and financially responsible options before your mortgage adjusts