Home $$s & Sense

Dear Sue

I have been waiting for my home to sell for almost six months. After the Thanksgiving holiday my Realtor called and said that I had received an offer on my home. The offer was disappointingly low. Out of frustration, I accepted it.

We completed the contract paper work by fax and phone. Right after accepting that low offer, I received another one at a much better price.

My uncle said that I can probably get out the first offer because he heard somewhere that faxed signatures were not valid. When I told my Realtor he said that they were valid.

I could just kick myself for jumping on that first offer but I would really like to get out of it and accept the second offer.

Do you see a way out?

Sorry Sam

Dear Sam

Everybody wants to get the best price. Hindsight is always 20/20.

Stop kicking yourself. No one knows what will happen in the future. We only know what is happening right now.

How could you have known that another offer was eminent? Most discouraged sellers are eager to accept almost any offer.

I know that your uncle was only trying to help but he is wrong. I am sorry too, Sam. Faxes, copies, and faxes of copies, even copies of faxed copies and copies of copies are acceptable under California law.

If the faxed documents are not readable it is recommended that a clean unsigned version of the original form be attached to the faxed document.

It is even acceptable to have two copies of the same form; one with the buyer’s signature and one with the seller’s signature.


Dear Sue,

I want to sell my house because my neighbor is ‘certifiable”.

He interferes with everything I do. He’s always at my door. He yells at my kids, he complains about my dog, he even came into my yard and shook his fist at me in a threatening manner.



Yesterday he called my insurance company because he said my car flipped a rock up onto his windshield and cracked it. When I explained to him that I couldn’t have done it, he threatened me by shaking his fists in my face. I am beginning to fear for my safety as well as the safety of my family.

Since I have decided to sell, I need to know how much about Mr. Maniac, as we fondly refer to him, I need to disclose to the next buyer.

Fearful Frank

Dear Frank

Unfortunately you need to disclose all of it. It is a material fact that could affect a buyer’s decision to buy or not to buy.

Years ago an associate of mine was sued for failing to disclose an obnoxious threatening neighbor.

My associate represented a seller that was moving because of an obnoxious and threatening neighbor.

After settling into his home the new buyer was accosted by the obnoxious neighbor with a shovel. He was scared to death. Local residents told the buyer that the obnoxious neighbor had always been like that; In fact it was the reason for the sale.

This information prompted a lawsuit for failure to disclosure.

I would suggest you get legal advice. Sounds like your neighbor needs some restraint, as in “restraining order.” You should be making police reports in the event this guy goes over the hedge so to speak.

I wish you luck. A good rule of thumb is that if you have a question about disclosing something you
should disclose it.

Disclosure is a matter of good Home $$’s and Sense.

Labels: contracts, disclosure, fax, signature

Driving down Mt. Vernon Road yesterday beneath a shimmering canopy of brilliant fall color I felt a deep sense of gratitude well up. I began to reflect on all the reasons to feel grateful for living in such a wonderful place.

First, the natural beauty that I was experiencing just driving down this beautiful country road to my home. I thought about the snow capped Sierras, the American river, the canyon, the rolling hills and valley views. We have an amazing variety of trees, from deciduous to evergreen.

The proximity and magnitude of these natural wonders provide unlimited recreational opportunities and has put Auburn on the map as the Endurance Capital of the world. Mountain biking and hiking, kayaking, skiing, boating, fishing, camping, horseback riding and don’t forget, gold panning.

Auburn loves to celebrate! We celebrate everything from vintage cars to eggplant. We still have wonderful small town parades. We even have a parade for dogs. As I write, there’s a 1951 Dodge flat bed truck, fully decorated and ready for the Festival of Lights parade parked in my barn. A look at the Auburn Chamber of Commerce calendar of events says it all.

Our community’s love and appreciation of the arts is without equal. Our own Auburn Symphony has performed at the Mondavi Center. We have art walks and studio tours. We even have our own art center and gallery, where our local talent is displayed.

We live in a community that honors and preserves its history. Our beloved courthouse is the centerpiece of our town. The latest re-roofing bid came in at approximately one million dollars. It’s not the first renovation and it certainly won’t be the last. Our community has lovingly maintained the courthouse building for over a hundred years. We are unique in that so much of our history is preserved in architecture. We don’t treat our buildings like museum pieces either, we actually live and work in them.

Our leadership values the quality of our community and our surroundings. Our leaders have had the foresight and dedication to preserve our lands and our agriculture. Public access provides countless hiking trails for all to enjoy. Our local food growers bring their harvest to the farmers market. The Newcastle Produce market and deli showcases locally grown foods and wines.

We don’t have to leave town anymore to enjoy a truly gourmet dining experience. I don’t want to mention all of our fine restaurants for fear of leaving one out.

One night last week I had a uniquely Auburn dining experience. I left my home, which is located adjacent to a fine local winery, drove a few minutes down Atwood road to a family owned and operated restaurant where I enjoyed a 5 star dining experience. The restaurant is located next door to the local bail bondsman. It just seemed so “Auburn,” unpretentious and quaint.

Auburn enjoys a vibrant business community. Its merchants and business people are creative, resourceful and energetic. We have upper town, lower town and old town. We have the Hwy 49 and Hwy 80 corridors and the Auburn airport. What more do we need?

I am most thankful for Auburn’s spirit of generosity! The citizens of our great community are generous beyond measure. Auburn takes care of its hungry and cold. We have the food closet, the coat and can tree drives and the Salvation Army. We have the thanksgiving community dinner where many families volunteer to serve. We raise money for people who are sick and without means. We donate huge dollars for medical research. We have countless fundraisers for education and other worthy causes. We have service organizations like Rotary, Soroptomists, Lions and Elks. We have Project Auburn, Hands Across Auburn and the Auburn Community Foundation. For all this, I am thankful.

I am sure there are many other reasons I forgot to mention that we should be thankful. If you would like to share, please post your comments.

Happy Thanksgiving!

Sue

Labels: Auburn, California fall Thanksgiving gratitude

Dear Sue

I was a victim in my own mind until I read your column, Thinking Outside the Short Sale Box. I believed that short sale or foreclosure were my only options.

As a small general contractor I was turning work away three years ago. I hadn’t been without work for over twenty years. I had a couple of really big jobs lined up that were going take me through the next year when my clients all got cold feet at the same time. Suddenly my cash flow was gone.

I had a few properties to sell but I had very little equity in them. My first thought was to dump them and do short sales. When I read your article, and you gave so many options, I decided to start with my lender. I called them and I asked them what alternatives they had to short sale or foreclosure.

I was relieved when they said I didn’t have to make payments for two months. It gave me time to regroup and pick up some lucrative remodeling jobs.

I consider being able to keep my home a blessing. Thinking outside the short sale box works!

Relieved Randy

Dear Randy

Relentless news reports have made short sales or foreclosures a troubled homeowner’s only solutions.

Stressed out homeowners are so caught up in their financial woes that they are blind to any other away out of their predicament.

Remember, the present financial situation is temporary!

A foreclosure or short sale does not have to be the default solution!

Dear Sue,

After reading think outside the short sale box, I refused to accept on offer on my home that put me in a short sale position. Instead, I countered an offer that I received. My agent reminded the buyer’s agent that if we had to do a short sale the lender might not accept it.

We countered back at the amount we needed to break even. Our counter offer was accepted and everyone was happy.

Happy Hal

Dear Hal,

Congratulations! I want to caution all of you to listen to your agent. That particular counter may not always be the way to go.

Every transaction is inherently unique. Your agent will help to evaluate your particular set of circumstances and advise you accordingly. That is the value of a good real estate agent.

Thinking outside of the short sale box can be a matter of good Home $$'s and Sense.

Dear Sue

I came from the Midwest where it is freezing by October. Last fall while it was icy back home, I looked at Auburn property in my convertible. I found a home I really liked and bought it.

Shortly after moving my realtor suggested that I winterize my new home. She even gave me a checklist. I laughed. I am sorry to say that I was fooled by the California convertible weather that I experienced all the way through November. I couldn’t believe that it would ever freeze here.

As a result of my foolishness, I failed to prepare. I didn’t wrap any of the pipes coming into my house. I left my wellhead exposed to the elements. I didn’t drain my pressurized irrigation system.

I spent thousands in repairing burst pipes, cracked pumps and lived without a water supply for a week.

All you newcomers to Auburn take heed!
Take winterizing seriously!
Don’t do what I did!

Midwest Mike


Dear Mike

Thank you for your timely letter. I have been enjoying my convertible the past two weeks. It is easy to be fooled by our balmy fall weather!

Here is a list to help you to minimize “winter damage”

1) Clean gutters and downspouts
2) Take care of misalignments and seal leaks in your gutter system
3) Clean the chimney
4) Make sure you have an ample supply of dry firewood and kindling
5) Cut any overhanging limbs that may be near the chimney
6) Make sure you have a spark arrester
7) Inspect your roof and blow off any debris, especially in the valleys
8) Inspect your roof for loose and missing shingles and weathered flashing
9) Wrap all exposed pipes from the source at the street or well
10) Drain pressurized irrigation lines (they will burst when frozen)
11) Service heating systems, change filters and test air ducts
12) Replace damaged and missing weather stripping
13) Test the batteries in your smoke detectors
14) Check for proper drainage in your yard
15) If you live in a flood area make sure you have an ample supply of sand bags. (People don’t often think about sand bags around here. When I was growing up in Manteca it was necessary because sometimes the Delta overflowed.) This area has irrigation canals and creeks.

If any readers have additional winterizing ideas they would like to share, email them and I will add them to the list, or post them on the homedollarsandsense.com blog. It is a matter of Good Home Dollars and Sense!

Dear Sue

I was talking to a friend of mine about my disappointment in not having enough available cash to take advantage of some of the incredible real estate deals in today's market.

He told me that he was buying real estate through a self directed IRA. I have money in an IRA but it is mostly invested in mutual funds.

I would be interested in investing some of my retirement money in real estate. Can I do this?

Investor Mike

Dear Mike

Yes it is true. Anyone can buy real estate with IRA money if they open a “self directed” IRA account. Then you can make your own decisions regarding where your money is invested. Those investments can include real estate.

According to Uranga Associates, an IRA real estate company, there is approximately 10 trillion dollars invested in IRAs and other qualified plans. The majority of these funds are held in stock market-driven accounts. A very small portion is actually invested in real estate.

A handful of brokerage houses are set up for self directed IRAs, which allow a wide variety of non-traditional investments.

Most IRA investments are more conventional in nature such as Cds, mutual funds and stocks and bonds. If you set a up a self directed IRA you can buy mortgages, raw land, commercial buildings, vacation rentals, multi family homes, private notes, private stock, start up businesses and shares in LLCs just to name a few.

The good news for investors considering this strategy is that it can be done without cashing in your existing IRA account, and can be done penalty free, tax deferred, and sometimes even tax-free.

The IRS allows you to roll over your traditional IRA into a self directed IRA penalty free. The taxes due on the growth of the investments are deferred until distribution begins at retirement. If a self-directed ROTH IRA is involved, the principal and earnings are tax free when distributed at retirement.

The process is relatively simple. I rolled over my IRA after the dot com crash. I realized I didn’t know enough about the stock market to make intelligent investment decisions. My banker suggested that I should go into a self directed IRA and make real estate investments since real estate is my field.

She gave me a few names and I settled on a company called PENSCO located in San Francisco. My IRA funds were transferred to PENSCO who
became the custodian. I have been directing PENSCO to invest the funds in various pieces of property over the last several years. Since my IRA is not a ROTH I will have to pay taxes when the earnings are distributed to me.

I love it because I can personally manage the asset and I get to sell without any capital gains tax. I watch the rents I receive fund my retirement. The best thing is that it is all compounded.

There are some IRS rules about whom you can invest with. Please consult with your custodian for more details. You can also Google self directed IRAs or PENSCO and learn a lot.

For me it has been wonderful because I understand real estate. My returns have been far greater than any traditional IRA investments I have ever had. I love being able to see my investment and having a hands on relationship with it.

I have actually considered selling some of my present investments and buying some of those screaming deals that you have been noticing.

Why don’t you investigate the possibility of a self directed IRA? It could be a matter of Good Home $$s and Sense.