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- Check the air filter on your heating system monthly and clean or replace as necessary. Open and close cutoff valves to sinks and toilets, to be sure they’re working properly.
- Clean lint from dryer ducts. Be sure flexible exhaust pipe behind dryer isn’t pinched. Consider replacing plastic pipe with metallic. Be sure exterior vent flap closes properly
- Repair, clean and seal wood deck at least every other year. Replace damaged or twisted boards. Deck stains with pigment last longer than clear sealers.
- Your asphalt roof should last 20 years – if you don’t ignore it. Clean leaves from roof valleys. Wash mildew and moss from shingles. Use prepared cleaner or mix your own.
- Scrape and touch up spots where paint fails most often, allowing water to penetrate. Check window sills and gable vents, especially on western and southern sides.
- Clean refrigerator and freezer coils. Check for leaks behind dishwasher toe panel. Replace cracked washing machine hoses. Clean filters then reattach hoses.
- Be sure air conditioner’s condensation drip tubes are flowing freely. Clogs can damage your system and the rest of your house.
- If you smell a musty odor, check ducts for leaks. Your air conditioner could be overworking and pumping in unhealthy air. Repair leaks with mastic, not duct tape.
- Caulk around windows and doors with caulk that’s paintable. Be sure weep holes in storm windows are open to allow water to escape. Clogged weep holes can cause rotted sills.
- Check gutters. Clogs can cause all sorts of water damage, from rotted fascia to moisture in the crawl space. Use hose to be sure downspouts are flowing freely.
- Seal holes in foundation, especially spots around pipes and wires where rodents might enter.
- Check windows and attic for condensation. Reduce water vapor by using bathroom and kitchen exhaust fans and limiting use of vent-free gas logs
Caveat Renter: Fraudsters Falsely Advertising REO as RentalsFreddie Mac’s fraud unit is teaming up with real estate professionals who list HomeSteps homes to sniff out bogus rental ads of REO properties — a growing problem, according to Freddie Mac.
“We’re hearing more reports about fraudsters trying to cash in on the housing crisis’s remaining foreclosed homes by advertising them as rentals on the Internet,” writes Freddie Mac in a recent blog post warning about the Craigslist REO rental scams.
The scam works like this: After a house is sold at foreclosure, a scammer then posts an ad online trying to rent out the home before the new owner moves in. Interest renters then contact the scammer about leasing the property, and they are asked to submit their personal credit information for the lease application as well as two months of rent.
It’s often not until the would-be renters try to move in that they realize they’ve been duped: The key to the house doesn’t work or they find the house is for sale or even that the previous owners are still living there. There have been some cases where scammers change the locks in the house and give the renters a working key. It’s the real estate listing agent who then often discovers the renters living there and the scam.
Freddie Mac and real estate professionals are working together to find the fake Internet rental ads. When they do, they are having the ads removed immediately. They’re also warning renters on how not to be duped from the ads, such as always verifying the home’s status through a listing agent or through county records.
Over the past 50 years in America, becoming a homeowner has developed into such a standard rite of passage that millions of people have signed on the dotted line without ever really stopping to consider the alternatives. Perhaps if more them had, we might not have had to watch the roof collapse on the real estate market.
When you look at the way we really live — how long we stay in one place, what kind of amenities we want — it turns out that home ownership isn’t quite the universally advantageous deal we’ve all been led to believe.
Jailed in by the White Picket FenceLet’s first take a look at mobility — our ability to pack up the kids and move for, say, a new job.
Imagine two friends working at the same job in Seattle — one who owns a home and one who rents. After they both get laid off, a new job becomes available in Dallas. All things being equal, the renter is in a far better position to go after the new job. After all, the mess of selling a house can drag on for months.
In fact, the mobility of America’s workforce right now is lower than it’s ever been since the Census Bureau started tracking such statistics after World War II. Before 1980, about 20% of the population was mobile in any given year.
Here’s what has happened since: Being locked into a mortgage severely limits one’s potential opportunities in an ever-changing job market. The mobility conundrum becomes even more dire when you consider that the average age of a first-time homeowner has gone down over the past decade to 30. That means a large percentage of the first-time buyers are younger than 30 — with their mortgages potentially impeding their career growth.
The Decision to SellOf course, the easy answer is to sell your house if you need to move for a job. But take a look at what happens to your dream home/investment.
In 2011, the National Association of Realtors found that the average home-seller had lived in their house for nine years. That means if you have a 30-year mortgage, about one-third of the house should be paid off, right?
Wrong. In fact, it’s usually not until about the 21st year that an owner will have paid off just half of the principal on a mortgage. That’s because the nature of an amortization schedule front-loads the interest payments to the bank, and back-loads the equity-producing payments on the house. In essence, the average homeowner is simply paying rent for nine years to a bank instead of a landlord.
Even if you stay put for a long time, the financial payoff of buying a home is hardly a slam-dunk argument against renting. In fact, Yale economics professor Robert Shiller, who predicted the popping of both the dot-com and real-estate bubbles, has shown that after adjusting for inflation, home prices have remained virtually unchanged since 1890.
The reason is actually quite simple: Homes are “just manufactured goods. Houses in 20 years may have lots of new amenities … we can’t anticipate now. So people won’t want these old homes,” Shiller argues.
But With Today’s Rates, I Can’t Lose, Right?Historically speaking, yes, it’s a great time to buy. The 30-year fixed rate on a mortgage is as low as it has ever been.
But even if you own and you pay off your mortgage in 30 years, there’s still no guarantee that you’ll come out on top of a renter. Using The New York Times nifty calculator — which takes into account inflation, closing costs, maintenance, and so on — we see that renting is still a good option.
Imagine two friends live in identical $200,000 houses next to each other.
- One friend, Spending Sammy, buys his house paying 10% down with a fixed 3.8% mortgage and a property value that increases 3% per year.
- The other friend, Frugal Fred, pays $900 rent per month (more than Sammy’s $840 mortgage), and his rent increases by 3% per year. Fred saves the equivalent of the down payment and any money from not paying for home improvements. Over time, Fred simply invests that money in a fund that matches the stock market’s historical 8.8% return.
After 30 years, Sammy sells his house and they both move down to Florida for retirement. When all is said and done, Fred will walk away with roughly $90,000 more than Sammy — and he didn’t have to worry one bit about repairs and upgrades to his house!
Let’s Be Clear: There’s a Time and Place to Buy a HomeIf it sounds like I think buying a home should be reserved for only the foolish, that’s not the case. It’s just conditional to what you want.For some people, there’s absolutely no price you can put on the social and emotional benefits of owning a house. If that’s you, and you’ve considered all the alternatives, then by all means: Buy away!
But if you think you’re not an adult until you’ve purchased a house — or that by doing so you will guarantee the best, most secure returns on your money that you possibly can — well then it’s time for you to re-evaluate this aspect of American dream.
Your credit score is like a movie: constantly changing until you decide to freeze a frame. Your score, which lenders use to assess your bill-paying ability, is in a constant state of flux and will vary from one credit company to the next. In other words, you don’t have one credit score, but many.
“Your score can be updated every time there’s a new piece of information,” says Sarah Davies, senior vice president of analytics at VantageScore Solutions.
VantageScore is a credit-score model created by the three major credit- reporting companies, Equifax, Experian and TransUnion. There’s also the FICO credit-score model created by Fair Isaac, which is the score most commonly used by lenders to determine your credit worthiness. Roughly 70% of credit scores change by up to 20 points in a 90-day window, according to VantageScore. Consider it a reflection of your credit behavior at a particular moment in time.
“You could do something every other day, like pay a bill or miss a payment, and it might change every other day,” Ms. Davies says. “The reality is a lot of those updates are insignificant.”
A score is determined mainly by how promptly you pay your bills and what kind of debt you carry, though other factors also feed into it. For example, a mortgage and a car loan hold more weight in the scoring system than a handful of retail credit-card accounts. So timely mortgage and car-loan payments are more important.
Your credit score may be as important as your education and your job skills because it helps you navigate your lifestyle. It’s taken into account when you buy a house, a car or insurance, and when you seek credit for a small business, try to rent an apartment or get utility service. People with higher scores enjoy lower interest rates and bigger loan amounts. Poor scores can mean high interest rates and less favorable terms.
But mining your score on a monthly or daily basis won’t improve it. “Consumers should be credit managers, not credit-score managers,” Ms. Davies says. What’s important is that your “range of risk”—what lenders consider key to determine whether you’ll make timely payments—is acceptable. But that risk assessment isn’t consistent from lender to lender. Auto lenders, for instance, use a different algorithm than a mortgage lender or retailer might.
Scores also vary because the three credit-reporting companies don’t have the same information. “Lenders don’t report all the same things to all the [credit-reporting companies], which is why scores will vary,” says Beverly Harzog, a credit-card analyst with Credit.com. The two main scoring systems use different point ranges: FICO, which has been around since the late 1950s, scores in a range of 300 to 850. VantageScore, introduced in 2006, goes from 501 to 990. Still, experts say the range of risk will be about the same if your score is, say, 800 on FICO and 900 on VantageScore. What matters is which scoring system your lender uses and where you fall on that. If your FICO is 700, don’t confuse that with 700 on the VantageScore, which puts you in a lower credit category. Scores will vary, too, based on when lenders report to the credit company. Some banks may report your payment behavior to Experian at the beginning of the month but give it to TransUnion mid-month.
A credit report from Experian, TransUnion and Equifax, which you can get free annually at AnnualCreditReport.com , will include details on your bill-payment history—but not your FICO score or VantageScore, which are what you should care most about. You’ll have to pay for your scores, though it’s generally under $20 for each. Don’t worry about your scores changing unless the moves are dramatic. If your score changes significantly, either you made a financial misstep, such as missed a payment or, worse, someone stole your identity.
Here’s what you should worry about and how to fix it. Don’t try to manage your score on a daily or weekly basis. If you wait for the full 30-day cycle, all your information will have updated and will be the best representation. If you want to purchase a home or car in the next year, look at your credit score now and make moves to improve it by paying off debt in a timely manner. Your credit reports may contain errors. If you contest something in your report, it freezes that information until a decision has been made. A foreclosure or bankruptcy filing will lower your score significantly and affect you for about seven to 10 years. A missed mortgage payment will set off alarms, especially if your payment history has been pristine until then, but a late credit-card payment can be more easily fixed by consecutive months of good payment behavior.
Buying a home is a complicated process, and it can be particularly daunting for the first-timer. The following timeline starts one year before you hope to start seriously shopping for a home. This is an ideal; you can arrange your finances and buy a home in less time, if necessary, but you’d be smart to walk through all of the steps in order. The more time you give yourself for this process, the better.
A year out (or as soon as possible)Get your credit reports. Errors on your reports can force you to pay a higher interest rate on your mortgage or even torpedo your chances of getting a loan. You can get free copies of your reports from the three major credit bureaus — Equifax, Experian and TransUnion — at AnnualCreditReport.com. Look for accounts that aren’t yours, collection accounts for debts you don’t owe and negative marks (other than bankruptcy) that are older than seven years.
Get — and improve — your FICO credit scores. Your credit scores, which are three-digit numbers used to gauge your creditworthiness, help determine the rates and terms you can get for a loan. There are hundreds of different credit-scoring formulas, but the one used by the vast majority of mortgage lenders is the FICO.
Consider a credit-monitoring service. Normally, I think these are a waste of money for folks who aren’t at high risk of identity theft. But given how important your credit and credit scores will be in buying a home, you might appreciate the early warning if a collector tries to post a bogus debt.
Deal with your debt. Most people needn’t pay off their student loans, auto loans or other generally low-rate debt before getting a mortgage. What you want to eradicate is “toxic” debt: credit-card balances and payday loans. These are signs you’re living beyond your means. If you don’t get your overspending problem fixed before you buy a home, your problems likely will get worse because homeownership typically involves plenty of big costs (property taxes, insurance, maintenance, repairs, improvements, decorating). Get your act together before you house shop.
Save, save, save. Stop eating out. Drop your cable-TV subscription. Do everything you can think of to put as much money aside as possible, using your desire to be a homeowner as a motivator. (Read “Could you stop spending for a month?” for inspiration.) In today’s market, it’s best to have at least a 5% down payment; boost that to 10% and you’ll have even more financing options. Ideally, you’ll also have enough left over after you get your mortgage to cover the payments for two or three months.
Put your bills on automatic. A single 30-day late payment can knock 100 points off your score, and it can take many, many months to recover. Make sure every bill gets paid on time. If you don’t have a reliable bill-paying system, consider using automatic debits, so payments come directly from your checking account, or an online bill-payment system’s recurring-payment feature.
6 months out.Sort through your mortgage options. A lot of people are losing their homes today because they didn’t understand what kind of mortgage they had or they accepted bad advice. The low teaser payments that allowed them to buy a more expensive house have jumped skyward, leaving them unable to pay. It’s up to you to understand the risks of the different types of mortgages and to select the right one for your family. My 2 cents: Stick with traditional, fixed-rate mortgages. If you can’t commit to a 30-year version, at least use a hybrid loan with a rate that’s fixed for as long as you plan to own the home.
Research all the costs of owning a home. Your mortgage will be just the start. You’ll have to pay property taxes and insurance on the home. There may be homeowners- or condo-association fees as well. You may face higher utility bills, and you’ll take on maintenance and repair costs as well. Decorating your new house can cost a pile of money as well: Have you shopped for window coverings lately? Your home-owning friends and a friendly real-estate agent or two can help fill you in so you know what to expect.
Adjust your saving strategies. What you’ve learned so far may inspire you to boost your savings. A bigger down payment, for example, can result in a larger home or a lower mortgage payment. Or you may simply want to build up your emergency fund so unexpected home expenses don’t knock your finances off the rails.
3 Months OutReduce your credit utilization. The FICO scoring formula is sensitive to how much of your available limits you’re using on your credit cards and other revolving lines of credit. The less, the better. It doesn’t matter if you pay your balances in full every month; the figure the scoring formula typically uses is the balance that shows on your most recent statement. Try to keep that balance below 30%, or even lower. If you can’t — because you charge a lot for work-related travel, for example — make a payment before the statement’s closing date to reduce the balance reported to the bureaus. Just be sure to make a second payment after the closing date, so you don’t get reported as late.
Don’t open or close any accounts. Until the mortgage process is completed and you’ve moved into your new home, continue to avoid actions that could potentially harm your credit, such as opening credit accounts or closing old ones.
2 Months Out.Get an idea of the mortgage rate you can expect. Order a fresh set of FICO credit scores — don’t worry, checking your scores doesn’t ding them — and talk to some mortgage lenders about what rates you might qualify for. (You’ll find current national averages here.) Don’t apply yet or give permission for your credit to be pulled; you just want to get a feel for what you can expect.
Understand the effect of mortgage-shopping on your score. You want to get the best rate and terms possible, which means you’ll need to shop around, but how does that affect your credit score? Here’s the lowdown: Every time you give a lender permission to check your credit, a “hard inquiry” appears on your credit report, and that can ding your score a bit. Fortunately, the FICO scoring formula lumps all mortgage-related inquiries made within a specified period and counts them as one. (The period used to be 14 days, but the most recent versions stretch that to 45 days.) Furthermore, the scoring formula ignores any inquiries made in the previous 30 days. So you want to do your serious mortgage shopping in a fairly concentrated period of time, typically after your offer on the home you want is accepted.
Get approved for a mortgage ahead of time. Pre-approval, in which a lender gives a commitment to make you a loan, is different and more valuable to sellers than pre-qualification, which merely gives you an idea of the size of the mortgage you might afford without making any commitments. You don’t have to get a loan from the lender that offers you a pre-approval letter. Getting a pre-approval does involve giving permission for a hard credit inquiry, but the small potential ding on your credit is worth it because you’ll be in a stronger position with sellers.
Consider a mortgage broker. Once your offer is approved, you can shop for a mortgage on your own, but if you want a lot of hand-holding through this process or your credit is particularly troubled, you might benefit from the services of an experienced, ethical mortgage broker. Get referrals from family and friends; you can also get a referral from the National Association of Mortgage Brokers.
Begin researching neighborhoods and look for an agent. Check Internet listings, attend open houses and find an experienced guide to help you refine what you’re seeking.
Once you’ve found your home and your offer is accepted, Shop for a mortgage. There are thousands available, and sorting through the possibilities can be overwhelming. That said, you may want to include some of the biggest national mortgage lenders, local lenders and online brokers. You’ll need to move fairly quickly to secure the loan, because the full approval process typically takes four to six weeks.
Arrange for an appraisal, a home inspection and a walk-through. The appraisal is required for your loan to be approved. An inspection isn’t necessarily required, but don’t skip this essential step, which can alert you to serious problems before the deal closes. The walk-through is usually done within 24 hours of the deal closing, so you can make sure that the home sellers have performed any agreed-upon repairs and the place is in move-in condition.
Get homeowners insurance. Mortgage lenders require this coverage, and you’ll need to prove you have it at closing.
Confirm how much money you’ll need at closing. “Closing” is when you sign all the paperwork and pay agreed-upon amounts, which can include your down payment and your share of legal fees, paperwork costs, property taxes and title insurance.
Enjoy your new home!
This is a great time to buy your first home, if you have prepared to do so. In many places, home prices are now 50% below what they were just two years ago. The federal government is offering $8,000 refundable tax credits (read “cash in your pocket”) for qualified first-time home buyers, and many states are offering additional incentives on top of that. It is tougher to qualify for a mortgage loan now, but those who can often buy a home for a lower monthly payment than rental on the same property. However, one of the reasons is it such a good time to buy is precisely because it is such a hard time to sell – so if you aren’t sure you will be staying in your home for a minimum of two years, and preferably at least five years, you probably aren’t ready to buy yet.
Here is an example of why it is so worthwhile to make the effort to properly prepare and then make a long-term commitment to buy a home. Suppose you can either rent or buy your home today for $1,000.00 per month, and that you will live there for the next 30 years. Assume also that your rent will increase an average of 3% per year over that time period. That is in year 2 you will pay $1,030.00 per month, in year 3 you will pay $1,060.90 per month . . . and in year 30 you will pay $2,356.57 per month to rent that home. (Frankly, I will be surprised if the average yearly rent increases stay that low for 30 years, which makes my point all the more). Over the 30 years total you will pay over $572,000 in rent, whereas if you have a 30 year fixed interest mortgage you will pay $360,000 in total principal and interest – a difference of more than $212,000!
Plus, if you buy you will have a paid off home but if you rent you have no equity in your home and can still be asked to move at any time by your landlord. Don’t think this will happen to you? I personally worked with people that lived in the same apartment for over 30 years, and then had to move when the owner sold the building and the new owner wanted to move his married child into the apartment. It happens.
How Much Can You Afford To Pay Monthly
A good place to start is to multiply your gross income (before taxes are deducted) by 25%. For example, if your monthly income is $4,000, then try to keep your mortgage payment as close to $1,000 as you can. You may be able to find loans as high as 40% of your income, which would qualify you for a $1,600 monthly payment on the same income. Try to find a home you are happy with at payments that are less than the maximum. Remember that you are going to have to pay for your own maintenance, something you have relied on a landlord to do in the past. Keep room in your monthly budget for emergencies and savings, if for no other reason than you probably will want to qualify for a bigger home in the future. This is very difficult to do if you overextend yourself.
Get A Copy Of Your Credit Report Your credit rating is probably the biggest single factor that will determine whether you will qualify to buy a home, and how much you will have to pay. If you have a poor credit rating, even if you do qualify, you will have to pay a higher mortgage interest rate than if you had better credit. Good credit can save you many thousands of dollars over the life of your mortgage loan.
There are three national credit agencies that maintain records of the amount of credit you have and your payment history. These are Equifax, Experian, and Trans Union. All three have websites that will give you detailed information about your credit history for a fee. When you apply for a mortgage loan, you will probably be checked against all three. Because of this, if you do contact one of them for a report, choose an option that will give you a composite report giving information from all three.
If you have recently applied for credit and have been turned down, by federal law you have 60 days to request a free copy of your credit report.
Check Your Credit Report For ErrorsOnce you have a copy of your credit report, study it carefully. If you find errors, write a letter to the agency that provided you the report explaining in detail each item on the report you disagree with and why. Keep a copy of the letter in your records for follow-up later. The credit agency will contact the person or business who reported the item you are questioning. They have 30 days by law to respond with proof that their report is correct. If they cannot do this, then the item must be removed, which will benefit you.
If you find true information that is unfavorable to you, use it to develop a specific plan how to improve your credit report in the future. Do this by working on the various items noted in the next section about your FICO score.
Understand Your FICO ScoreFICO scores have been developed by the credit industry to give a standard basis for comparing many different borrowers to predict who has the least risk of defaulting on repaying their loans. Lenders want to be repaid with interest. Some lenders will only work with those with a very low risk of default. Others are willing to work with a wider group of people, but charge a higher interest rate to everyone to offset the money they will lose on the portion of borrowers who later do not repay their loans.
One of the most important steps in preparing to buy your first home is to understand your FICO score and what you need to do to make it as high as possible.
FICO scores can range between a low of 350 and a high of 850. Scores between 700 and 850 are the best. Generally, you will qualify for the lowest interest rate if you can keep your score in this range. You do this by having a good mix of credit between revolving credit (such as credit cards) and fixed loans (such as car loans). Keeping your total amount of debt low compared to your income is important.
Credit cards can be useful financial tools, especially if you travel for business or other purposes. Strive to pay your balance in full every month. If you occasionally cannot pay in full, at least try to keep your credit card balances below 30% of your credit limit to keep your FICO credit score high.
For both credit cards and fixed loans, pay on time every time, and try to pay more than the minimum required on a consistent basis each month.
If you are good at paying on time, but keep your credit balances higher than 30% of your credit limit, you probably will have a FICO score in the 600s. A score between 650 and 700 will cost you a little more mortgage interest than a score above 700, but you will still qualify for many programs. Between 600 and 650, you will often pay 1 to 2 percentage points more, have a higher down payment requirement, and have less loans to choose from. On a $100,000 loan for a home you own 5 years, this interest difference alone will cost you $5,000 to $10,000!
If you have late payments, and have occasions you are over your credit limits, you will probably have a FICO score in the 500s. I have seen cases where with concerted effort people with scores in the 500s have raised their score 100 full points in one year. If you have a score in this range and do not own a home yet, you probably will want to focus on improving your score before trying to purchase your first home. If you decide to go ahead anyway, you may pay anywhere from 2 to 6 percentage points more in interest, plus extra upfront points, so be very careful. In today’s lending conditions, you will probably also have to make a larger than normal down payment in order to get the loan if your credit score is this loan. It can make a bad situation worse to buy a home before you are ready, get overextended, and then lose the home because you cannot make the payments.
People with the lowest scores (below 500) will probably not be able to find mortgage financing at all. These are usually people with recent bankruptcy, foreclosure, or judgment records on their credit report. All of these poor credit reports can be improved with time, good planning, and discipline. If this is you, definitely focus on improving your credit before attempting a home purchase.
Choose a Loan Officer
Interview at least three loan officers before settling on one you are comfortable with. Your bank or credit union is one place to consider, as are many of the licensed mortgage loan brokers. Try to find someone with good references and a wide variety of loan programs to choose from.
Comparing MortgagesMortgage loan advertising can be confusing. Try to find a loan that matches your needs. If you will live in a home for less than seven years, you probably want an adjustable rate loan, or one that is fixed for 5 to 7 years and then adjusts. These will often save you at least one percentage point compared with a 15 or 30 year fixed loan, and you will sell your house before the longer term loan is paid off anyway.
If this is likely a lifetime home, you may want to pay a little more for the 15 or 30 year fixed loan in exchange for its guarantee that the interest rate will not change. This is because interest rates are currently at historic lows, and are more likely to go up in the future than down. If you do choose an adjustable rate loan, make sure you understand how often and how high interest rate adjustments can go. Modest rate adjustments might be OK, while a loan with the possibility of payments doubling over a five-year period should be avoided.
If you have special circumstances, such as a business you are financing in addition to a home, you may want to get professional advice particular to those circumstances. A home equity line of credit charging only interest monthly at a low rate may be the best (or only) way to finance your business. Keeping your home secure is vitally important too. Weigh both carefully in your decision making.
Choose a RealtorOnce you know what you can afford to pay monthly, understand your credit, and know what mortgage you want, a good realtor can show you what homes are available that are consistent with your needs. Follow the same procedure as you did with the loan officer, interview at least three. Make sure you are comfortable with their personality, their professionalism, and their specific knowledge of real estate in your area.
A good realtor can also help you with all options. Buying your first home can be a daunting task. Sometimes the best option can vary between a condo, a fixer (if you have the time and skills), or a duplex (You rent out the other half of the home. It may be small, and you may have to deal with repairs and collecting rent, but it can be a good way to get started if you have the skills
The best realtor will want to work with you over a lifetime. If your first purchase requires a year of patience, your realtor will be there for you, because he or she wants your referrals and your future business when you move to a bigger home later.
Get Your Tax or Financial Questions Answered In A Future Article
I choose topics for my articles based on the questions I receive most frequently from you. I appreciate your input! I originally wrote this particular article on the steps you should take to prepare to buy your first home for my local newspaper in 2005, and have updated it in 2009 to reflect the opportunities currently available.
The information in this article is intended to inform you of some of the financial opportunities provided in the tax laws or elsewhere. It is not intended to give you specific advice for your personal situation, since each case is different. If you need such advice, please contact a qualified professional!
When Kathleen Marin and her boyfriend first moved to the Baltimore area in 2008, their two-bedroom town house cost them $1,100 a month. But over the next 2½ years, as demand flooded the rental market in their area, the landlord gradually upped their rent to $1,400.
Buying a home wasn’t an option for the 27-year-old student, who works part time and has a limited credit history. So late last year, the couple sought out a cheaper place. After searching online listings and visiting properties nightly for three weeks, they eventually found an apartment for $1,200 that they plan to move into in May. But the cheaper place comes with another price: a lot less space (one floor instead of their current two-story town house) and a dated kitchen.”If I’d gone into it and wanted the balcony and the brand-new kitchen,” Ms. Marin says, “I would never have found this apartment.
“The rental market is the tightest it’s been in more than a decade, with only 5.2% of apartments nationwide vacant at the end of 2011, down from a high of 8% in 2009, according to real-e state data firm Reis. Demand is up as the housing crisis and tighter lending standards have left many people unable to or wary of purchasing a home. And higher demand means average rents are rising, too.
To find the best deal possible in this market you first need to figure out what makes one rental cheaper than others in a given area. For instance, space in new apartment buildings is at a premium since relatively few buildings have been built since the housing crisis. That means the best deals can be found in older constructions, though even these are pricier these days. And amenities—and rents—can fluctuate substantially within a single building. An apartment on a lower floor will typically cost less than one on a higher floor. So will one with an obstructed view and little direct sunlight. The two-bedroom apartment Ms. Marin is moving into has a kitchen and appliances that are more dated than in some other apartments in the building.
When checking out an apartment, ask the real-estate or rental agent if there are less-expensive properties available. Ms. Marin and her boyfriend did so and snagged an apartment in the complex that was $120 cheaper than the one they were originally shown. If you are looking to rent a single-family home, that market is even more competitive since there are fewer such properties on the market. In many places, monthly rent for a single-family dwelling runs more than a monthly mortgage payment on a similar property would, says Michael Labout, a residential real-estate broker in Colorado Springs, Colo.
If renting a home is a temporary solution, you can save money by looking in a less-than-ideal school district if you don’t have school-age children or on a noisy street. Multifamily dwellings also are typically cheaper than single-family homes.
A newer entry into the rental market is homes being rented by owners who haven’t been able to sell. With information on local rental prices widely available online, these first-time landlords will likely be asking for market prices, says Jed Smith, managing director for quantitative research at the National Association of Realtors. Since their ultimate goal is to sell the property, these landlords may be more serious about maintenance of the property than a landlord who owns multiple properties, he says. So make sure a lease specifies who is responsible for taking care of—and paying for—what. And if you see a place that you really like that’s been for sale for an extended period, inquire about renting it instead. Owners may be open to a deal if they are desperate.
When it comes to negotiating rent, in this market you need to approach it the same way you would a home purchase. That means finding out what the comparable rents in the area are and presenting that data to the landlord. In a landlords’ market, “it will be more difficult to negotiate a lower rate, but the key to negotiating” will be comparable properties, says Mr. Smith. If you point out that an apartment is going for more than market rate, you’re likely to get it down to market rate. Also, showing a potential landlord your credit report to prove that you aren’t a financial risk can help you get a lower payment in some cases, says Mr. Smith.
If you’re handy, look for a fixer-upper rental. There are many more of them these days since landlords are confident they’ll be able to rent them with all of the demand. You can suggest making repairs in exchange for lower rent, says Mr. Labout. Just be sure to get it in writing.
Though real estate prices are barely budging, experts say this may be a good time to buy a house. But only for those willing to stay put.
On the face of it, the latest news doesn’t bode well for potential house buyers. House prices will steadily rise in 2012 but economists don’t see prices outpacing inflation over the next three years, according to a new survey. Typically, home prices bounce back after a prolonged recession and even help fuel a broader economic recovery. Not this time, according to that survey. The growth in house prices won’t even keep pace with that of a loaf of bread.
As real estate prices begin their slow crawl north, interest rates have only one way to go – up. “Whether you’re a 35-year-old looking to get on the property ladder or a retiree wanting to downsize, it’s still a good time to buy,” says Jay Tyner, president and founder of Semmax Financial Group in Greensboro, NC.
One caveat: Don’t think of a home as a short-term investment. “This is a good time to buy assuming you want to live in that home,” says Sheldon Garon, a professor of history at Princeton University and author of “Beyond Our Means: Why America Spends While the World Saves.” But don’t treat real estate as a get-rich-quick investment, as so many Americans did during the 1990s and 2000s, he says. “In many areas of the country, developers seriously over-built, which will depress house prices for some time.”
Current conditions are a win-win for both potential homeowners and long-term investors, others say. “For households, the priority should be on meeting their shelter needs at the best price — which may not entail ownership at all. – and appreciation, if any, should be viewed as a bonus,” says Patrick O’Keefe,director of economic research at J.H. Cohn LLP in Roseland, N.J. “For investors with longer-term staying power and property management capability, conditions are attractive — but property specific.”
What’s more, rents are also on the rise. Consumers are being hit by the rise in rents and the decrease in concessions being offered, according to a new survey by online apartment-lister Rent.com. Property managers predict that rents will rise between now and the third quarter of 2012 by 3%, above the 2.5% inflation rate between now and 2014 expected by most economists in a Wall Street Journal survey. Plus, the nation’s ratio of house prices to yearly rents is nearly back to its pre-bubble average.
Meg McKennon’s workload has surged since the Seattle real estate agent switched to managing residential properties. Now she gets paid for finding tenants instead of buyers — an easier task as rentals soar.
“In the past two months, my business probably came close to tripling,” said McKennon, who started management company Dwellings Seattle Real Estate in 2010 after selling houses for 15 years.
When a couple moved out of a two-bedroom house managed by McKennon in August, before the lease was up, she increased the monthly rent by $200 to $1,900 — and still had her pick of applicants. “I could have rented it 10 times over,” she said.
Just as the U.S. housing boom gave birth to such homebuyer websites as Zillow Inc. and Redfin Corp., services for rental properties are thriving following a surge in foreclosures and stiffening of mortgage standards. Membership in the National Association of Residential Property Managers has almost doubled in five years to a record 3,400 members, according to the Chesapeake, Virginia-based trade group.
“We are riding this sea change in how housing is changing in the U.S.,” said Reggie Brown, chief executive officer of All Property Management LLC, a Seattle-based Web service that sells property managers leads on homeowners who want to lease out their properties. “The only growth is rentals.”
Renter household formation surpassed new owner-occupied homes in 2007 for the first time since 1985 and has held the lead since, according to U.S. Census Bureau data. An average of 718,500 renter households a year were formed from 2007 to 2010, while owner-occupied households decreased at an average annual rate of 147,250 during the same period.
Even Seattle-based Zillow, known for its Zestimate home- price estimates, added rental listings almost two years ago.
‘Dramatic Shift’“There has been a dramatic shift toward renting,” Chris Herbert, research director of Harvard University’s Joint Center for Housing Studies, said in a telephone interview.
Property managers for rentals handle such tasks as screening tenants, helping landlords set rents, resolving disputes and ensuring lawns get mowed. They charge homeowners about 8 percent to 14 percent of the monthly rent, depending on the manager and city.
“It used to be no one did property management,” said Alan Townsend, a San Diego real estate agent who has managed homes for the past 16 years. “It was the ugly part of the business.”
Lower PayWhile one home sale can earn a real estate agent $10,000 for two months’ work, property managers may make $1,800 per property per year, Townsend said.
“Real estate agents think we’re crazy — except when they have no income,” he said. “Those agents are now flooding into the market.”
Property managers face a challenge in proving they are a benefit to homeowners, said Rob LeRoy, marketing director for Dwellings Seattle Real Estate.
“They are known to cut corners, have poor customer service and tend to create hostile relationships with tenants — at least, that’s a common perception in the eyes of the public,” he said. “We’ve certainly done our best to prove that property management companies can behave ethically and professionally, yet still be profitable.”
More competition has driven down the average fee for property managers to about 8 percent of one month’s rent from 10 percent in the San Diego area, Townsend said.
Rentals GainAt a time when many Americans are wary of buying a home or can’t qualify for a mortgage, rentals are gaining in cities that have relatively robust job growth, such as Seattle, or pools of transient workers, including Washington, Los Angeles and Las Vegas.
In the greater Washington, D.C., area, about 70 percent of Reliance Property Management Group LLC’s 100-plus clients are homeowners who were transferred out of the area by their employers, said Angela Gammon, co-owner of the Leesburg, Virginia-based company.
“We’re in a very transitional area with government contractors — military and so forth,” said Gammon, who used All Property Management to find clients when she got into the business in 2004.
U.S. apartment vacancies fell to a five-year low in the third quarter, enabling landlords to increase rents to an average effective rate of $1,004 a month from $997 in the second quarter and $981 a year earlier, according to Reis Inc., a New York-based real estate research company.
Attracting New Clients“When rents go up, that gives people enough cash flow to hire professional management,” said Diane Castanes, a partner at Phillips Real Estate Services in Seattle, which manages about 140 apartment complexes as well as a portfolio of single-family homes and condominium associations. “Now with the rental market so strong, we are bringing in an increasing number of single- family investors as new clients.”
Handling the rental — and re-rental — of a home is often too much trouble for an owner, said Jay Young, co-founder of Real Property Associates, a management company in Seattle.
“There are a lot of hairy things,” he said. “You can have the best-screened tenant and who knows? Maybe they lose their job, or go nuts and skip out, or bring a dog when the owner doesn’t want that. I’d say 95 percent of the time things go smoothly, but there’s always that 5 percent that takes 20 or 30 percent of your time.”
Competition for clients has intensified to the point where many property managers are advertising their websites directly on search engines rather than paying to list on a site such as All Property Management’s, Brown said.
Here to StayStill, such services as All Property Management and RentList.com probably are here to stay as property management becomes more popular, said Michael E. Nelson, president of Excalibur Home Management LLC in the Atlanta suburb of Cumming. Nelson has used both services to find clients for Excalibur, which manages about 1,250 properties and is expanding throughout Georgia.
Nelson said he expects more rental properties to shift to professional management as regulations governing landlords become more complex. A 2008 rule, for example, requires renovations or repairs affecting lead-based paint in homes built before 1978 to be carried out by a contractor certified by the Environmental Protection Agency, he said.
Managed by OwnersIt’s difficult to find precise figures for the percentage of U.S. rental housing that’s professionally managed. The Census Bureau surveyed rental-property owners and managers in 1995 and is working on a new rental survey that will be released toward the end of next year, said Richard A. Levy, a statistician at the agency.
Of about 8.8 million single-family rental homes in the U.S., including detached houses, condominiums and mobile homes, about 19 percent were professionally managed and about 78 percent managed by owners, with non-responses accounting for the remainder, according to the Census Bureau’s Property Owners and Managers Survey in 1995.
“I believe over the next 20 years that’s going to start shifting closer to 50-50,” Nelson said. “As the law becomes more difficult for individual landlords to navigate, they’re going to need to hire a professional property manager.”
It’s hard to make money overseeing single-family homes, said Tim Overland, chief operating officer of both Security Properties, a Seattle-based apartment developer and investor, and its management affiliate, Madrona Ridge Residential, which handles about 3,000 apartment units.
“It’s a very low margin business and a low barrier to entry business,” he said. “In order to make that business financially feasible, you’ve got to have quite a few units under management.”
Housing CrisisProperty management may have a role to play in fixing the housing crisis, said Brown of All Property Management.
In August, the Federal Housing Finance Agency, regulator of mortgage financiers Fannie Mae and Freddie Mac, sought ideas on handling foreclosed homes held by the government, which totaled 248,000 as of June — almost one-third of the total U.S. foreclosed homes seized by lenders. Brown filed a suggestion with the FHFA that the homes be put up for rent with property managers hired to oversee them.
“If institutions were more thoughtful about how they manage their real estate portfolios, the market would recover faster,” Brown said. “We can be a clearinghouse to help them find skilled property managers.”
Housing probably won’t recover until 2015 as consumers and banks reduce their debt loads and the employment market recovers slowly, Brown said.
“What’s going to change is the percentage of U.S. households that are rental versus owner-occupied,” he said. “It’s now almost 40 percent, but that number is definitely going to grow.”
Many sales associates have entered the field of rental property management as a way to shore up income. But do they know the risks?
1. Not having a written property management agreement. Even if you’re just helping out a friend and managing the property for free, you’re walking on thin ice if something comes up—like the need to evict the tenant.
2. Using a makeshift lease agreement. These agreements are easy to find on the Internet—maybe too easy. If the agreement isn’t thorough, or if it doesn’t include sections that are required by your state law, you’re leaving yourself exposed.
3. Not depositing the security deposit in a proper trust account. The proper place for the money isn’t with the owner. In some states, the trust account money must be in a separate property management trust account and not in the broker’s general sales trust account.
4. Not having the tenant sign a move-in and move-out form. This form includes a property condition disclosure. Without it, you have little recourse if a unit is damaged beyond the usual wear and tear.
5. Trying to incorporate a lease- purchase arrangement into the lease agreement. There’s nothing wrong with doing this, but it’s complicated, and if it’s not done properly, you could invite trouble. For instance, you could have a difficult time evicting the tenant for nonpayment of rent if the court looks at the arrangement as a purchase agreement.
6. Don’t know how to handle problems. What is critical, important, and not important. And who should be responsible for it and pay for it. Failure to do so will cause unnecessary confrontation with tenants, big bills for owners, and unnecessary liabilities for owners. PM is about managing property and problems.
7. Don’t know how to enforce the lease.
8. PM is a long term management relationship. It does not end at closing.
More sellers who are tired of their home lingering on the market or don’t want to have to take a loss on their home are opting to become landlords instead.
For example, according to an article at NPR, one couple describes owning a two-bedroom bungalow in Oakland, Calif., which they purchased for $500,000, that was appraised recently at $260,000. When a job relocation was sending them across the country, they decided to rent instead of sell.
But becoming a landlord isn’t an easy role to step into, as some of these “accidental landlords” describe difficult tenants and constant problem or maintenance issues that require fixing.
The number of unintentional landlords is growing. About 2.3 million single-family homes became rentals during 2005 to 2009, a significant increase compared to about 700,000 single-family homes that became rentals during 2001 to 2005, according to Eric Belsky with Harvard’s Center for Housing Studies.
“The good news for the owners or the reluctant landlords has been that the rental market has been so good, they’ve been able to cover pretty much all their expenses and just been able to basically go on with their lives,” Ron Abrams with the Chicago Association of REALTORS® told NPR.
March 4, 2010 By Monica Laliberte Source: WRAL
Cary, N.C. — During a recent wind storm, a 70-foot tall tree fell onto Mike Walters’ home in Cary.
“It went through my master bedroom wall and basically landed on my bed, right where my wife sleeps,” he said.
The tree fell from property owned by the local homeowners association.
Walters sought help from the HOA, only to be referred to an insurance company that denied his claim.
The homeowners association said Walters did not tell them he was concerned about the tree. Walters said he wasn’t concerned about it because he never thought the seemingly healthy, green tree was going to fall.
Under state law, if a healthy tree that does not appear to be a danger falls, the person who sustains the damage has to pay for it, because it is considered an act of nature.
The owner of an obviously dead or dying tree, one that a reasonable person would presume is a risk, can be held responsible for damage caused when it falls if he is aware of that potential.
Anyone who sees a tree that may be in danger of falling should take photos and notify the property owner by certified letter immediately. This will help if the tree does fall and damage property. The letter and photos will help prove the property owners were aware and should have taken action.
Without documentation, property owners can assert they were not aware their tree was in bad shape, and can be absolved of responsibility.
Knowing the law doesn’t make Walters any happier about his damage, but it does change the way he looks at trees.
“I’m gonna be proactive. I’m gonna let everybody know,” he said. “If it comes down on your house and you haven’t told them, then they’re not gonna help you.”
Ideally, experts say, it is best to work something out with your neighbor before something like this happens.
If that doesn’t work, you generally can’t make your neighbor take down a potentially dangerous tree in advance.
People should check with their local homeowners association or town to find out what its rules are concerning potentially dangerous trees.
Follow these tips to make sure you’re getting the best deal on your insurance.1. “If you’re shopping for a new home, consider the proximity to a fire station and fire hydrants,” says Vickie Montney, agent for highly rated Artisan Insurance Group in Tampa, Fla. “If you’re more than five miles from a fire station or more than 1,000 feet from a fire ydrant, you’ll pay several hundred more dollars per year for your policy.”
2. “A security alarm can take 10 to 20 percent off the annual premium of your policy,” says Joan Jochum, agent for highly rated Jochum Insurance in Cleveland. “You save more if the system links directly to emergency response teams rather than to a monitoring company. Deadbolts, fire extinguishers and smoke detectors can save you money as well.”
3.“You can save money by switching to a higher deductible policy,” says Kevin Watkins, agent for highly rated State Farm Insurance in Santa Clarita, Calif.
4.“Cut down dead trees and overhanging branches,” Montney says. “If you’re not maintaining the property, companies can cancel or not renew a policy.”
5.“If you’re in a hurricane area, have storm shutters,” says Daniel Juliani, owner of highly rated Juliani Insurance Services in Wellesley, Mass. “Insurance companies also look at electrical systems to make sure they have breakers and that furnaces have had a new burner within the last 25 years. These things don’t necessarily save you money on a policy, but they can make you ineligible for coverage.”
Mold in your home can cause anything from a stuffy nose to a serious infection. Here, some highly rated service companies let you know how to prevent it – or fight it:
1. Watch the Water:“The key to preventing or controlling mold is moisture control,” says Tom Schultz, who owns A-rated Certified Mold Inspection & Remediation Services in Minnetonka, Minn. “You can’t avoid it in the bathroom, so you have to ventilate, and we find mold regularly in attics that don’t have good ventilation. To control it, use a properly designed rain gutter system and landscape grading, which should slope away from the house.
2. Keep it Clean: “Clean your gutters regularly, typically twice a year, and keep all your vegetation trimmed away from the siding,” says Tyler Mittendorf, owner of highly rated First Choice Home Inspection in Bothell, Wash. “Otherwise, these things will trap moisture against your house and block your gutters, and it may cause excessive moisture around the foundation.”
3. Location, location, location: “If your home is situated near a wetland, you could run into some chronic problems with moisture intrusion,” Schultz says. “You’ll need to take additional measures, like adding drain tile and a sump pump system in your basement.”
4. Catch it Early: Mold tests are often separate from regular home inspections. Mittendorf says he finds mold in more than half the homes he inspects, but doesn’t always do the mold tests. “I give [the client] the option to do additional testing,” he says. “They may sign a waiver saying I offered it and they chose not to do it.”
After installation of a new carpet..There are several things you can do to prevent premature wear and tear. Follow these tips from The Carpet and Rug Institute on how to keep your carpet looking clean and plush.
1. Don’t let that spill sit. Soak up liquids as soon as possible to prevent permanent stains. Before treating the stain with a cleaning product for the first time, be sure to test it on a hidden area of your carpet.
2. Charge your air filters regularly. Not only does changing air filters help with the air quality in your home, but it also picks up dust particles destined for your carpet.
3. Vacuum frequently. Dirt wears down carpet fibers, making it look matted and worn. Vacuuming several times a week will help keep your carpet looking newer longer.
4. Get it cleaned by a professional. The Carpet and Rug Institute recommends having your carpet cleaned every 12 o 18 months to remove any embedded dirt and grime.
5. Take your shoes off. Shoes deposit dirt in the carpet and wear down the fibers. Walking around in your stocking feet makes for a clearner carpet.
Share the Good News About DurhamA recent Wall Street Journal article by M.P. McQueen has ranked Durham, North Carolina as the best real estate investing market in the nation. According to the article “Regions that rank highly for investment suitability are those where there is a low probability that home prices will fall further”. The article goes on to say “In the best markets, home prices already are stabilizing. Durham, N.C., for instance, is home to Duke University and is near the University of North Carolina-Chapel Hill. Big companies like International Business Machines Corp., GlaxoSmithKline PLC and Nortel Networks Corp., as well as numerous biotech start-ups, have facilities at the nearby Research Triangle Corporate Park. About 40% of area jobs are in health care, education or government”.
Home owners who decide to rent out their properties have to stop thinking of themselves as home owners and instead consider themselves as running a small business, experts say.
Thinking like a businessperson means focusing on the monthly cost of maintenance, mortgage and taxes, as well as being aware of landlord-tenant regulations and avoiding liabilities.
Here are key issues to consider:
- Set a fair rent. Setting the right price will make it more likely that a landlord will be able to keep the place rented.
- Understand landlord-tenant rules. Running afoul of landlord-tenant regulations and rules regarding security deposits can be costly.
- Screen applicants. Eliminating potential tenants who can’t pay or who won’t take care of the property is very important.
- Lay out the rules in a lease. Widely available sample leases can help. If you have questions, ask an attorney.
- Consider a property manager. Despite the expense, turning the job over to experts can help a landlord come out ahead.
- Talk to the condo association. If the property is a condominium, be prepared to deal with a host of regulations.
Regarding the March 6 article “Chapel Hill area is in developer’s sights”:
Glen Lennox will be missed, particularly by those fortunate enough to live in its affordable, centrally located housing. Where will they go if this property is redeveloped and upscaled? What effect will forcing this group of renters to search for other housing in this market have?
Clearly the developers and current owners of this property stand to make a lot of money as this property is upgraded. Equally clearly, the current residents will be hard-pressed to find comparable housing, much of which is being torn down to construct much more profitable “luxury” housing. Competition for remaining low- and moderate-priced rental housing will drive up the rental costs for all renters, whether they live in Glen Lennox or not.
The town of Chapel Hill should require, as a condition of granting the redevelopment permit, that the developers add an equivalent number of low- and moderate-income housing units within city limits, with equivalent access to public transportation.
Redevelopment can be a good thing as long as we don’t leave ordinary people behind as we do it.
George Leggett gets about 30 calls a day from people complaining about their landlords.
The consumer protection specialist with the Attorney General’s office said that the calls run the gamut, from security deposit refunds to repairs and early termination of lease.
But the bulk of the calls boils down to one question: What are my rights?
Often callers don’t like his answers.
For instance, Leggett said he often gets calls about landlords who have not made repairs and in retaliation they have stopped paying the rent.
“I have to tell them they can’t withhold the rent,” Leggett said, acknowledging that that is the last thing someone wants to hear when their heat isn’t working and it’s cold outside.
But North Carolina law does not allow tenants to withhold rent payments or even put the funds into an escrow account if a landlord fails to provide services.
The only legal way to withhold rent is to go to court and request that a judge grant a rent abatement.
With so many universities in the area, Leggett also gets lots of calls from students with questions about lease agreements. The most frequent: “Am I responsible for the entire rent if my roommate moves out?”
The answer most often is yes.
Some landlords make separate leases for each student, Leggett said. As a result, the student is only responsible for his or her portion of the rent. The downside: The landlord gets to select the roommate.
In situations when the legal answer is not as clear, Leggett turns to colleague Len Green, who handles landlord-tenant disputes.
Green’s most-often asked question? “Am I still responsible for the lease if I get a new job and have to move out of town?” Or some version of the “I’ve got a good reason, so I don’t have to pay, right?”
Most often, callers don’t like Green’s answers, either. If a tenant needs or wants to move, he or she is responsible for any time remaining on the lease.
“A lot of people feel if they have a good cause, they can override the lease,” said Green. “But that is not true unless their lease gives them that option.”
Green said that state law allows for only two circumstances in which someone can be let out of a lease early without penalty:
* when a soldier is deployed overseas,
* when someone has to move because of domestic violence.
Another common gray area is determining how much a tenant should be charged for damages to a unit.
“The law excludes normal wear and tear as damage,” Green said. Therefore, tenants who live in a home for, say, five years and wear down the carpet cannot be charged for replacing it when they leave. However, if the carpet is torn or has a large stain, they can be held responsible for at least a portion of the cost, he said.
Leggett said that he recommends that people take pictures or video of the apartment when they move in. If they notice any tears or other damages, they should bring it to landlord’s attention immediately.
Most people skip this step, only to regret it when a problem arises, Leggett said. “It seems like overkill, but it’s not.”
Pictures came in handy for Stephen St. Amour.
St. Amour’s apartment was flooded in the summer by rains from tropical storm Alberto. The apartment was inhabitable and was eventually condemned, but the manager of the apartment complex refused to return his security deposit.
St. Amour submitted pictures to the Attorney General’s Office showing the apartment with at least a half foot of water throughout. Leggett was eventually able to get St. Amour his full refund.
St. Amour’s problem required repeated phone calls, but usually, a resolution is easy to find, Green said.
The best place to look, he said, is the lease, where information about security deposits, pets, damage and termination of the lease should be outlined.
“I always tell people, look at your lease, the answer is probably in there,” he said.