The Silent Killer

Carbon monoxide is colorless, odorless and toxic. It's called the "silent killer" in homes because some victims are not even aware that the deadly condition exists.

Homeowners must be concerned about unmaintained furnaces, water heaters and appliances that can produce the deadly gas. Other sources could include leaking chimneys, unvented kerosene or gas space heaters and even exhaust from cars operating in an attached garage.

The Environmental Protection Agency suggests the following to reduce exposure in the home:

• Keep gas appliances properly adjusted
• Install and use an exhaust fan vented to the outdoors over gas stoves
• Open flues when fireplaces are in use
• Do not idle car inside garage
• Have a trained professional inspect, clean and tune-up central heating systems annually

There can be many symptoms of carbon monoxide poisoning that can resemble other types of poisoning. Headaches, nausea, vomiting, dizziness and feelings of weakness or fatigue are a few of the most common symptoms. Lower levels of exposure may be mistaken for the flu.

Roughly half the states have laws regarding carbon monoxide detectors in homes. Regardless of the requirements, what person would want to put their family, guests or themselves at risk for something so deadly? The devices can be purchased for as little as $20 and plugged into the wall like a night light.

Significant Problems

"The significant problems you face today cannot be solved at the same level of thinking you were at when you created them."

          - Albert Einstein

The housing market has definitely caused significant problems for some people but is also providing some amazing opportunities for others. Agents aren't like retailers who wake up one day realizing they have the wrong merchandise on the shelves.

Everyone needs a place to live and whether you rent or buy, you pay for the house you occupy. While the home for sale remains the same, the methods that produce results have to change.

Listing agents are diametrically opposed to the objectives of buyer's agents. This is not to say that there cannot be a win-win situation but each agent is trying to negotiate the best price and best terms for their client.

Financing can make listings more marketable and structure a transaction to provide the buyer with the cheapest cost of housing. Personal experience is a great teacher but a very expensive way to learn. An expert, like a Residential Finance Consultant can provide information and tools to make better decisions to be able to profit in the current market.

5 Insider Secrets for Coming Up with Cash for Down Payment

Most home buyer’s biggest hurdle is coming up with the cash for a sensible down payment.  Gone are the days of zero-down loans, so if that was your plan, you’re going to need a new one!  Coming up with a down payment for a home is a challenge because it’s not chump change we’re talking about, here.  The down payment on a $200,000 house, for example, will run you anwhere from $7,000 (on an FHA loan) to $40,000!

1.     The FHA Bridal Registry.  Yes - you read that right! The FHA Bridal Registry Program enables wanna-be home buyers to apply their families’ wedding gifts toward their down payments. And although it’s named a “bridal registry” program, you don’t have to be a prenuptial couple to use it. You could also use this program to collect gifts for graduation, the arrival of a baby or some other major life event in which people want to give you gifts. 

The FHA Bridal Registry works like a traditional registry, but is more flexible. The registrants visit their choice of FHA mortgage lenders and set up what essentially is a custodial savings account for the sole purpose of funding their down payment. The couple’s (or individual’s) family and friends can either deposit funds directly into the account or give the cash or check to the couple or individual, who then deposits it into the account. The account’s flexibility also goes beyond that of traditional down payment gift rules that are applicable to FHA loans, which are detailed below in insider secret #2. With the FHA Bridal Registry Program, the only gift documentation required is “lender and borrower certification of the funds.”

2.     Family gifts.  Most lenders will allow home buyers to apply gift money from family members toward their down payment - within guidelines, that is. First, the lender will require a letter from the giver verifying that it in fact is a gift and not a loan. (They generally frown upon it being a loan because it would add to the buyer’s debt and change their debt-to-income ratio.) And second, the person giving you the money must be a relative. The reasoning here is that a friend will most likely expect you to repay the money, whereas a relative won’t. 

FHA loans will allow the gift to make up any portion or all of the buyer’s down payment, many conventional (non-FHA) loan programs will restrict the proportion of a buyer’s down payment that can come from gift money.  The lender may also have specific ways they want to see the money go into and out of your accounts. Before you accept a gift toward your down payment, be sure to check with your mortgage broker or loan rep to be sure that you’re dotting all the right i's and crossing all the right t's.

3.     Your Employer.  Some companies offer assistance programs to employees. Most are government, university, large company and financial industry employers. One example is safety workers: n some areas, safety workers like firefighters and police can have access to down payment grants from their employers if they buy properties in the city where they are on-call as first responders. Also, many large colleges and universities, very large companies and banks and lending institutions offer down payment help and have below-market-rate mortgages set up for faculty members and staffers.  Check with your Human Resources department to see if any such program is available to you. 

4.     City/County/State Programs.  Some states, counties and cities still offer programs that lend or give home buyers some assistance for down payments. These programs vary widely in scope - for instance, many target buyers with low and moderate incomes, while some seek to help the buyers of foreclosed or fixer-upper type homes. Some don’t have to repaid - meaning they are given as grants and are forgiven entirely if the buyer lives in the property for 30 years, but must be repaid if the buyer sells or rents the home out before the 30 years elapses. The programs pretty much all have some sort of homeowner education component that requires applicants to take personal finance and homeownership preparedness classes before they can receive funds. To learn more, visit your city, county and state websites to learn about programs that might be able to help you.

5.     Your Retirement Funds.  Many financial advisors would advise against this, but if you have a 401K or Roth IRA account and some years to go before retirement, you might be able to tap into it or even borrow against your own funds for your down payment. Currently, you can take up to $10,000 out of your Traditional IRA with no penalty to put toward the purchase of your first home, but you will be taxed.  You can take as much as you want out of your Roth IRA contributions with no penalty or taxes, though, and as much as $10,000 from your earnings penalty-free for your down payment.  The rules get a little tricky, here, so definitely check in with your tax and financial advisors.

And while you can’t similarly draw from your 401K, many retirement and pension plans will allow you to borrow the money against your funds, then repay it to yourself – at interest. So the choice there comes down to paying your lender back with interest or paying yourself with interest. That choice should be you! But first, get some advice from your CPA or financial planner. This option might not make financial sense for your particular situation.

 

More To Sell

If you had a 3.5% mortgage on your current home and were buying another home, transferring your low interest rate mortgage would be ideal. Unfortunately, lenders don't allow that.

When buying a home today, it would be smart to think about selling it in the future. To have a good home with unique features makes it marketable. To have attractive financing that could be assumed would add to the salability.

Consider getting a FHA or VA loan to purchase your home. The present advantages are that these loans are priced competitively and a little easier to qualify for than conventional loans. The future advantage is that FHA and VA loans are assumable at the original note rate for qualifying buyers.

There's more to sell than the home itself when you have an assumable loan. The mortgage payment could lower the cost of housing significantly. A buyer may easily be willing to pay more for the home due to the attractive financing, especially if it helps their equity grow faster.

The Investment Alternative

To say the investment market is unsettling is an obvious understatement. The market is down 8% in the last ten days and the news doesn't give much hope that things are going to get better in the near term.

Preservation of capital is probably today's most important investment consideration and making a profit would be a bonus. Of all the conventional investment alternatives like stocks, bonds, mutual funds, gold, commodities, CDs and annuities, housing is the best asset class in America.

Homes have had a 30% to 40% price correction in the past four years. Mortgage rates are at near all-time low rates with 30 year terms available for investors. Rents have increased significantly over the past two years while vacancy rates have decreased. People will always need a place to live.

Five year certificates of deposits earn a little over 2% but rental properties are yielding eight to ten times more than that. Income properties are tangible assets that have benefitted dramatically in inflationary times. Cash assets can be devastated by inflation and diversifying into income properties can provide real protection.

Single family homes offer investors the opportunity to borrow large loan-to-value mortgages at fixed rates for long terms on appreciating assets with tax advantages and reasonable control. Investing in rentals can provide stability, safety and a higher rate of return.

Ten Tax Tips for Selling Your Home

The Internal Revenue Service has some important information to share with individuals who have sold or are about to sell their home. If you have a gain from the sale of your main home, you may qualify to exclude all or part of that gain from your income. Here are ten tips from the IRS to keep in mind when selling your home.

1.    In general, you are eligible to exclude the gain from income if you have owned and used your home as your main home for two years out of the five years prior to the date of its sale.

2.    If you have a gain from the sale of your main home, you may be able to exclude up to $250,000 of the gain from your income ($500,000 on a joint return in most cases).

3.    You are not eligible for the exclusion if you excluded the gain from the sale of another home during the two-year period prior to the sale of your home.

4.    If you can exclude all of the gain, you do not need to report the sale on your tax return.

5.    If you have a gain that cannot be excluded, it is taxable. You must report it on Form 1040, Schedule D, Capital Gains and Losses.

6.    You cannot deduct a loss from the sale of your main home.

7.    Worksheets are included in Publication 523, Selling Your Home, to help you figure the adjusted basis of the home you sold, the gain (or loss) on the sale, and the gain that you can exclude.

8.    If you have more than one home, you can exclude a gain only from the sale of your main home. You must pay tax on the gain from selling any other home. If you have two homes and live in both of them, your main home is ordinarily the one you live in most of the time.

9.    If you received the first-time homebuyer credit and within 36 months of the date of purchase, the property is no longer used as your principal residence, you are required to repay the credit. Repayment of the full credit is due with the income tax return for the year the home ceased to be your principal residence, using Form 5405, First-Time Homebuyer Credit and Repayment of the Credit. The full amount of the credit is reflected as additional tax on that year’s tax return.

10. When you move, be sure to update your address with the IRS and the U.S. Postal Service to ensure you receive refunds or correspondence from the IRS. Use Form 8822, Change of Address, to notify the IRS of your address change.

For more information about selling your home, see IRS Publication 5223, Selling Your Home.  This publication is available at www.irs.gov or by calling 800-TAX-FORM (800-829-3676).

iPad2 Drawing!

The results of the iPad2 drawing are in!  Congratulations to our winner, Eric Walsh!

Woulda - Coulda - Shoulda

It is the mantra of people who missed a great deal. It's the theme song of the procrastinator. It's the refrain that reminds us of the one that got away.

Some people are still beating themselves up because they didn't recognize the housing bubble was really going to burst. It is impossible to change the past but will they see the signs of the next housing trend?

In the past four years, prices have adjusted with 30% corrections nationally and much more in areas with high percentages of foreclosures. New homes are almost non-existent. Interest rates are slightly above record lows. Consumer goods are skyrocketing; our budget deficit and national debt are staggering and escalating inflation appears certain.

"Forget stocks. Don't bet on gold. After four years of plunging home prices, the most attractive asset class in America is housing." states Shawn Tully, Senior Editor at-Large for Fortune magazine in a March 28, 2011 article.

"If I would have known that this was the best buyer's market ever, I could have taken advantage of the prices and interest rates; I should have fixed my cost of housing for years to come." Don't catch yourself saying this. You owe it to yourself and your family to get firsthand information to see what your options really are.  Come in to Triplett today to find out how you can take control of the housing market and take advantage of the great opportunities awaiting you!

Why Do I Need Renters Insurance?

National statistics show that if you rent, chances are good that you don't have renters insurance -- nearly 2/3 of renters don't.

Possibly the greatest misconception about insurance and renting is that the landlord or the managing agent of a rental property has insurance that will cover tenant property. Unfortunately, this just isn't true.  The homeowners insurance that a landowner carries protects only the property of the landlord (structure of the building, personal articles of the landowner stored in the building, etc.).  The insurance policy of a landlord cannot cover renter's belongings because of the far-reaching scope of such a policy.  The insurance companies just can't take on that much risk in one location.  In some ways, the idea of homeowners vs. renters insurance is similar to a computer network that is being protected by a firewall or other electronic barrier.  Although the network itself is protected in case something goes wrong, each individual computer needs to also have current virus protection and security measures in place to ensure the safety of files and documents.

If you are a renter and don't have renters insurance, you're leaving yourself completely unprotected against most dangers of renting.  For instance, if your apartment is burglarized, or if you find yourself the victim of a flood, fire or other natural disaster, you'll essentially be on your own.  Especially in Iowa, instances of flooding are extremely prevalent, even in brand new homes.

In a recent incident, two of our renters faced the need to replace belongings as a result of a disaster.  One renter had renters insurance and consequently had all of their belongings reclaimed/replaced, and was even put up in a hotel for 1 month and given monetary compensation to the amount of thousands of dollars.  However, the other renter didn't have renters insurance and lost everything.  It's unfortunate that disasters happen, but it's important to make sure that even if the unthinkable happens, you'll be prepared and protected.

Most renters insurance policies cost between $5-10/month and cover you up to $20,000 for personal property, will pay hotel and food expenses for up to 12 months, cover you in case you are sued for liability, can help with medical payments, and even cover you in case of identity theft!  (For more information, see this post.

In most cases your insurance agent (whoever you have your car insurance, etc. through) can add on a renters insurance policy for next to nothing.  This is because most insurance agencies offer a multi-policy discount that makes renters insurance nearly free!  We can't recommend it highly enough.  Our in-office staff are big believers that renters insurance can make the difference.  If $10/month can save everything you own and give you peace of mind if something ever happens, we think that's worth it.

Whether you get renters insurance from one of Triplett's knowledgable, powerhouse independent insurance agents or from another agency of your choice, it may just be the best decision you ever make, and in the words of one renter of ours, "...the best $10 I ever spent...".

Stay safe - come visit us in our office today to insure your life and belongings!

Note: If you're looking for more information about renters insurance, take the first step by starting with some of the following websites:
The Basics
General Information
Additional Information
Statistics

Drawing for a Free iPad2!

With the rental turnover season just behind us, Triplett Companies is excited to announce the previously advertised drawing date for the brand new Apple iPad2 (visit the apple website)!  Earlier this summer we announced that in the fall there would be a drawing to win, and now we’re happy to spread the news that the drawing will be held on Monday, August 15, 2011.

As mentioned previously, the way to enter to win is simple.  All you have to do is subscribe, follow us or like us on any of the following social sites:

                facebook
                twitter
                youtube

For each site you use to keep in touch with us (including this blog!) we’ll enter you into the drawing once.  That means you can have your name entered to win as many as 4 times!
Hope to see you around soon!  We’ll be announcing the winner of the iPad2 the afternoon of the 15^th!