Living La Vida Local

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Offers Peter Miller of Realty Times: Without a down payment you would need to finance $350,000 -- at 6 percent over 30 years that would be $2,098.43 a month for principal and interest. Then you would also have costs for taxes, insurance, repairs, utilities, etc.
If you had roommates the cost would quickly become more affordable.
Here are some steps you can take:

· Sit down with lenders to see what financing is available to you -- there are loan programs which permit income from borders to count for qualification purposes.
· Consider a less-expensive property that you can fix-up over time.
· Buy a duplex or triplex property -- live in one unit and rent the rest.
Speak with a tax professional to see how a home purchase would change your personal finances. Rent from others is income, but you will have write-offs for mortgage interest, property taxes, depreciation, etc. You are likely to have far-smaller tax bills than you now face.

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Question: My mother, is ready to sell her home. A pest control inspection made and the report revealed termite infestation damage of about $20,000. This is a very old home, it is not bolted, and sits on a large lot. We anticipate a buyer might tear it down and build a new home on the lot, so we hesitate to spend money for repairs before listing the house for sale. What is your advice?

– Adrienne
Santa Monica

Offers Real Estate expert Bob Bruss: If I were in your mother's situation, I would disclose the estimated $20,000 damage shown in the inspection report and offer the home for sale "as is." An "as is" sale means the seller must disclose known defects but will not pay for any repairs. But it would be desirable to get several additional inspection reports to see if they all agree the repairs will cost around $20,000. Have the reports easily available to serious buyers so they will know about this problem they should consider when making their purchase offer.

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TWELVE WAYS TO SAVE MONEY ON YOUR HOMEOWNERS’ INSURANCE

By Jodi Summers

A study by the Independent Insurance Agents & Brokers of America (IIABA) found that 51 million homeowners’ are paying higher premiums than they did two years ago. Homeowners' insurance is a must-have needed to provide homeowners’ and lenders with financial protection against disasters. A standard policy insures the home itself and the things you keep in it.

The price you pay for your homeowners’ insurance can vary by hundreds of dollars depending on a number of factors, including the company you buy your policy from. The Insurance Information Institute has come up with 12 ways to help you save money on your homeowners' insurance.

1. SHOP AROUND - Ask your friends, check the Yellow Pages or call your state insurance department. Check consumer guides, insurance companies and online insurance quote services. This will give you an idea of price ranges and advise you which companies have the lowest prices. Go beyond price and select several semi-finalists, call see who offers price and service - should need assistance in filing a claim. Check the financial ratings of the companies with AM Best or Standard and Poor's.

2. RAISE YOUR DEDUCTIBLE - Deductibles are the amount of money you have to pay toward a loss before your insurance company starts to pay a claim, according to the terms of your policy. The higher your deductible, the more money you can save on your premiums. Currently, most insurance companies recommend a deductible of $500. If you can raise your deductible to $1,000, you may save as much as 25 percent. Remember, earthquake and flood insurance are separate policies and have their own deductible.

3. BUY YOUR HOME AND AUTO POLICIES FROM THE SAME INSURER – Some companies that sell homeowners, auto and liability coverage will take 5 to 15 percent off your premium if you buy two or more policies from them.

4. MAKE YOUR HOME MORE DISASTER RESISTANT - Find out from your insurance agent or company representative what steps you can take to make your home more resistant to natural disasters. You may be able to save on your premiums by retrofitting so the property is better able to withstand earthquakes. In addition, consider modernizing your heating, plumbing and electrical systems to reduce the risk of fire and water damage.

5. DON'T CONFUSE WHAT YOU PAID FOR YOUR HOUSE WITH REBUILDING COSTS -
The land under your house isn't at risk from theft, windstorm, fire and the other perils covered in your homeowners’ policy. So don't include its value when deciding how much homeowners’ insurance to buy.

6. IMPROVE YOUR HOME SECURITY - You can usually deduct at least 5 percent for a smoke detector, burglar alarm or dead-bolt locks. Sophisticated sprinkler systems may your premium by 15 or 20 along with fire and burglar alarm that ring at the monitoring stations. Before you buy, find out what kind your insurer recommends, how much the device would cost and how much you'd save on premiums.

7. SEEK OUT OTHER DISCOUNTS - Ask your insurance representative about discounts available to you. For example, retired people have more time for maintaining their homes. If you're at least 55 years old and retired, you may qualify for a discount of up to 10 percent at some companies.

8. SEE IF YOU CAN GET GROUP COVERAGE - If your employer administers a group insurance program, check to see if a homeowners’ policy is available. Additionally, professional, alumni and business groups often have an insurance package, which includes a discount for association members.

9. STAY WITH THE SAME INSURER - If you've kept your coverage with a company for several years, you may receive a special discount for being a long-term policyholder. Six years with the same insurer can yield a 10 percent discount.

10. REVIEW THE LIMITS IN YOUR POLICY AND THE VALUE OF YOUR POSSESSIONS AT LEAST ONCE A YEAR - You want your policy to cover any major purchases or additions to your home. But you don't want to spend money for coverage you don't need. If your five-year-old fur coat is no longer worth the $5,000 you paid for it, you'll want to reduce or cancel your floater (extra insurance for items whose full value is not covered by standard homeowners’ policies).

11. LOOK FOR PRIVATE INSURANCE IF YOU ARE IN A GOVERNMENT PLAN - If you live in a high-risk area and have been buying your homeowners’ insurance through a government plan, do some shopping. There may be steps you can take that would allow you to buy insurance at a lower price in the private market.

12. WHEN YOU'RE BUYING A HOME, CONSIDER THE COST OF HOMEOWNERS
INSURANCE
- You may pay less for insurance if you buy a house close to a fire hydrant. It may also be cheaper if your home's electrical, heating and plumbing systems are less than 10 years old. Wooden frame houses are more likely to withstand earthquakes. Your choice may cut your premiums by 5 to 15 percent.

If you have questions about insurance for any of your possessions, be sure to ask your agent or company representative when you're shopping for a policy. For example, if you run a business out of your home, discuss coverage for that business. Most homeowners’ policies cover business equipment in the home, but they offer no business liability insurance. Make certain you have all the coverage you need.

For more information check out the Insurance Information Institute at the
Federal Consumer Information Center at www.pueblo.gsa.gov.

We like real estate, and always have time to help you, your family and your friends with their real estate needs. If you would like to more information of interest to property owners, please email Jodi Summers at jodis@verizon.net, or call at 310-260-8269.


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p.s. This is not intended as a solicitation if your property is already listed with another agent.