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October 11, 2013 7:18 pm
A: It is an agreement between a renter and a landlord in which the renter signs a lease with an option to purchase the property. The option only binds the seller; the tenant has a choice to make a purchase or not.
Lease options are common among buyers who would like to own a home but do not have enough money for the down payment and closing costs. A lease option may also be attractive to tenants who are working to improve bad credit before approaching a lender for a home loan.
Under this arrangement, the landlord agrees to give a renter an exclusive option to purchase the property. The option price is usually determined at the outset, but not always, and the agreement states when the purchase should take place.
A portion of the rent is used to make the future down payment. Most lenders will accept the down payment if the rental payments exceed the market rent and a valid lease-purchase agreement is in effect.
Before you opt to do a lease option, find out as much as possible about how they work. Have an attorney review any paperwork before you and the tenant sign on the dotted line.
October 11, 2013 7:18 pm
BPT—While giving a new $900,000 home a thorough going-over, Salt Lake City home inspector Kurt Salomon found a problem under the deck. The builder had cut corners, using the wrong kind of fasteners to secure the deck to the house. Yet, the municipal building official had approved the work.
"In some cases, a building inspector is not going to crawl underneath the deck looking at the hardware. A good home inspector will," says Salomon, past president of the American Society of Home Inspectors.
Because it uncovers aspects of the home that are unsafe or not in working condition, an inspection is a must when buying a home, says J.J. Montanaro, a certified financial planner with USAA.
"You want surprises that come with homeownership to be happy surprises, not bad ones," Montanaro says. "A thorough home inspection by a certified professional can help ensure that's the case."
Salomon says an inspection of the house you want to buy helps identify not only safety concerns and failing structural elements but faulty mechanical systems and areas that soon may need maintenance.
You'll pay around $300 to $500 for an inspection, which can take two to three hours. The cost can vary based on your geographic region, and the size and age of the home. Requesting other services, such as septic and radon testing, will add to the fee.
"An inspection is money and time well-spent," Montanaro says. "If your inspector finds things that should be repaired, you can use that report as leverage to have them fixed or negotiate a lower price."
To help get the most from a home inspection, Salomon and Montanaro advice you to follow these steps:
Do your homework: Many contracts include a home-inspection deadline, so start shopping for an inspector when you qualify for a mortgage. This gives you time to find a qualified, professional inspector.
Look for the inspection clause: Before you sign a contract, make sure it includes a clause that makes your purchase contingent on the findings of an inspection with the inspector you choose. This can provide a way out of the contract if the inspector finds a major problem the homeowner won't address.
Make sure the clause is included even if the contract specifies an as-is sale, meaning the seller does not agree to make repairs. "If a seller's not willing to let you inspect the house, that's a big red flag," Montanaro says.
Hire a pro: Shop around. Ask friends, neighbors and real estate agents for recommendations. For help online, the American Society of Home Inspectors has a database of its certified inspectors. And the Department of Housing and Urban Development offers a list of 10 questions to ask inspectors.
Ask to see a sample report: Inspectors fill out reports, following checklists for different areas of a house. It should be clear and informative. Reports longer than 25 pages filled with lots of legal print — usually meant to protect the inspector against liabilities — raise a red flag. By the same token, a few pages aren't enough.
Accompany the inspector: Take notes and ask about maintenance issues you'll need to address, such as waterproofing the deck, caulking the siding, changing air filters and other matters.
Review the report: The inspector will send you a written report detailing his or her findings. Read it closely and ask questions to make sure you understand the condition of all areas of the home.
If your inspector finds a leaky roof, a faulty water heater or some other problem, you may have the right to ask the seller to correct it to your satisfaction or to lower the price. If the seller refuses, you may be able to break the contract without penalty.
If a seller agrees either to make the repairs or offer to lower the price, take the money and then fix the problems yourself.
October 11, 2013 7:18 pm
Family Features—Millions toil away in their office cubicles, dreaming of owning their own piece of the American dream. Meanwhile, many entrepreneurial thinkers are using rough economic times as the catapult for making their small business dreams come true.
With so many types of business models available, it can be hard to determine which one is the best fit for you.
Brick and mortar
Commonly thought of as the most traditional of plans, this business model involves businesses housed in physical buildings from which they sell their products. One major advantage of brick and mortar businesses is the personal interaction typically achieved between consumer and owner. Due to the rising popularity of online shopping, many brick and mortar businesses are turning to the internet, combining a physical location with an online presence.
Bricks and clicks
The "bricks and clicks" model is typically used to describe a business with a both a retail and an online location. A major advantage of the brick and click model is it allows customers to see the product physically, coupled with the option to buy products with the convenience of a mouse click. One disadvantage of the brick and click model is the higher overhead required to run both a physical location and keep a website fresh and current.
Many examples of successful bricks and clicks businesses are retailers which, in particular, sell clothing and footwear. Local customers can go in to try on the wares physically and then purchase from the comfort of their own home.
A franchise is a business model that involves two parties - a franchisor and a franchisee. Franchises are a good fit for those with an entrepreneurial spirit but who also may lack business experience and would benefit from the structure, support and guidance the franchise model provides. To become a franchisee, an entrepreneur pays a fee and/or shares the revenues of the business. Because a franchise is owned by a franchisor, the franchisee must follow set guidelines.
If you're trying to narrow down your options, knowing your location and community is essential. Some franchise opportunities, such as The UPS Store, specialize in building franchise opportunities in small towns and rural locations. As many of these areas are underserved in business, packing and shipping amenities, such franchise models deliver a sought-after service for other small businesses and citizens within the community. Having a clear understanding of your community's needs can ensure your new business venture is successful and profitable.
Without a physical retail structure, the direct sales model sells products through independent distributors who specialize in face-to-face experiences with the consumer. One main benefit of direct sales is the ability to sell without overhead or supply costs of running a facility. Many direct sales entrepreneurs purchase their products directly from the parent company piecemeal, so no additional storage space is needed to house the product.
Source: The UPS Store
October 11, 2013 7:18 pm
With over half of all homeowners planning to make some type of improvement to their home this year, the question is, what exactly are they changing? Homeowners are choosing to wait until the high temperatures break and cooler weather hits to begin outdoor work, and home improvement companies are looking to unload new products to prepare for the new season, allowing homeowners to grab some great deals as autumn begins.
The most common fall home improvement projects include fencing, interior and exterior painting, window work, flooring, and roof repair, all of which are in preparation for the cold winter weather when home improvement projects are not at the top of your priority list. By getting these projects done before winter, you can put your home improvement projects to rest until spring without worrying about leaky roofs, cold air coming through cracks in the windows, and maintaining the value of your home with fencing and a fresh coat of paint.
"The cooler autumn temperatures make for the perfect time to focus more on the home and any remodeling projects," said Jeremy Floyd of Fence Center. "Such projects like adding in bamboo or aluminum fencing, not only increases your family's security, but the value of your home. Now that autumn is officially here, people are likely beginning to get these home improvement projects rolling."
According to Floyd:
- Projects such as flooring, such as wood, can only be done during certain months of the year because certain types of flooring employ adhesives that need temperatures inside the home to be within a certain range, usually between 70 and 80 degrees. Attempting to employ these types of flooring in the winter can make it difficult for the flooring to dry and bond, which will prove problematic down the road.
- Fall offers the perfect time to increase the security of your home, particularly for fencing, as the ground is not too hard to work with.
- Painting provides a pungent scent and sometimes toxic fumes, making fall the perfect time for painting. Without the humidity, paint can dry quickly, keeping the aromas of the paint to a minimum.
October 11, 2013 7:18 pm
Master deed. Document that converts a parcel of land into a condominium subdivision.
October 11, 2013 7:18 pm
A: It depends who you negotiate with. Some lenders are willing to haggle on both the loan rate and the number of points, but this is not typical among more established lenders.
This is why it pays to shop around for the best loan rates. And know the market so that you sound informed when talking to a lender. Read the published rates in local newspapers or check the growing number of Internet sites that publish such information.
Also, always make a point to consider the interest rate along with the points to access which loan is truly the best.
Interest rates are much more open to negotiation on purchases that involve seller financing. While they are usually based on market rates, some flexibility exists when negotiating on the rate.
October 10, 2013 7:15 pm
Contracting the right builder is a critical first step in the construction process of your dream home.
Some homeowners liken it to hiring an employee -- while others compare the experience to a marriage – you have to spend a lot of time together, make a lot of big decisions and ultimately trust each other to build something that lasts.
“This is the biggest purchase you make – period,” new homeowner Amy Greene says.
Don Ghiz also has recent experience in hiring a contractor. He is in the middle of a construction project and said he spoke to several candidates before making his selection.
Before picking a contractor, Ghiz evaluated a number of builders based on their level of experience, competency, style of house they were comfortable building, method of accounting, communication skills and willingness to stay positive.
“In a city like Houston, we are fortunate to have many good quality builders that meet those basic requirements,” he says.
Both homeowners and builders offer the following advice on what to look for when choosing a builder:
1. Ask for recommendations. Greene said she found her builder, Brandon Lynch, by asking her friends. Having a recommendation helps. “I’d definitely do my homework and look at a lot of custom builders,” she said. “Then go look at their houses and spend time talking with them.”
Lynch agreed. “Get to know the builder,” he suggested. “Get to know who they are and what they stand for – are they passionate about building homes or are they all about the money.”
2. Get lost in the details.
Greene said that Lynch’s detailed bid sealed the deal for her. She explained that costs can go up if builders do not give all the information up front.
“Without details, prices can skyrocket,” Greene said. “You want a builder who has a really good idea of what things will cost.”
Ghiz noted that customers need to assess the builders’ choice of quality materials and be assured that contractors will not cut corners to save expenses without discussing the options.
“In my case, I looked for a builder with genuine concern that I get what I want at a fair price,” he said. “I looked for a person who would say, with honesty, ‘I don’t think you’ll like that, and here’s my reason for saying it.’”
3. Talk it out. As in any good relationship, communication is key.
Greene and Lynch spent hours talking before they began to work together.
“We discussed every detail of the project in full before we started construction," Lynch said.
4. Trust your instincts – and back it up.
For Ghiz, it all came down to trust.
“When all is said and done, your builder will spend many months on what you may live in for the rest of your life, so consider the choices carefully and don’t ignore your gut,” he said.
Hann was the builder who fit the bill for Ghiz.
“We have barely started construction, but I already like the choice I made,” Ghiz said.
“I feel fortunate to have a professional builder like Stephen Hann.”
Ghiz' builder, Stephen Hann, agreed that trust is essential, adding that his years of experience in the business help his clients believe in him as a builder. He also has several certifications in construction, as well as several examples of other homes he has built to show.
“I come with a confidence level that clients appreciate,” Hann said. "The whole decision boils down to comfort level and proficiency.”
5. Use your resources. Building groups, like the Custom Builders Council of the Greater Houston Builders Association, can be great resources for homeowners.
October 10, 2013 7:15 pm
Businesspeople know that when a disaster occurs recovering and restoring business operations is far easier when you are prepared with a detailed plan.
With that in mind, below are tips to help business owners minimize risks and plan for a safe, speedy recovery in the event of an emergency.
"A solid disaster plan will help minimize damage in the event of an emergency, while also providing a clear path to quickly recovering your business operations," says Jack Roche, president, business insurance at The Hanover. "And disaster planning doesn't need to be an overwhelming task. Begin by contacting your independent insurance agent to review your coverage and risk management solutions, to make sure your business is adequately protected."
Minimize risks ahead of time
- Review your business insurance policy with your insurance agent or advisor: Discuss possible disaster threats, including fire and weather, and make sure your policy includes the proper coverage and endorsements
Develop a strong disaster plan
- Identify business-critical activities and resources: Lining up resources now with clear accountabilities, will enable you to maintain customer service, if and when your business facility is closed for repairs.
- Keep up-to-date duplicate records of both computerized and written records: Maintaining and safeguarding accurate business records isn't just practical—it's the law. Having this information will also help you to get back into business much quicker.
- Plan for the worst: Before disaster strikes, find and develop a list of alternate facilities, equipment and supplies, and identify qualified contractors to repair your facility.
- Consider emergency resources: Your disaster plan should include sources for back-up power and for employee and customer communications, as well as first-aid kits, water, and flashlights.
- Compile and share a list of important phone numbers: In addition to your employees and company officers, your emergency contact list should include local and state emergency management agencies, major clients, contractors and suppliers, realtors, financial institutions, and your insurance agent. Be sure your list includes primary and cell telephone numbers.
- Include a plan for contacting customers: You don't want to lose your customers because of a fire or other disaster. So make sure your plan includes a way to stay in touch with your customers. Depending on your business model, you may want to be prepared to post information on your website or reach out by telephone, email, or social media channels.
- Train your employees and establish your emergency response plan: Build your plan and make sure employees are trained on how to execute it, including evacuation procedures.
- Review and update your plan on a regular basis: Keep you plan current and communicate any changes to your employees. Do it at least annually or more frequently.
- By planning ahead for a fire or other disaster, you will help protect your business, employees, and valued customers.
October 10, 2013 7:15 pm
Cooking is the No. 1 cause of home fires, and a significant contributor to home fire deaths, according to the National Fire Protection Association (NFPA).
It's a good idea for parents to talk to their children about fire safety in the home.
"Children practice fire drills at school, and adults practice them in the workplace, but many families have not practiced a fire escape plan in their homes," says Kathy Krafka Harkema, Pella Windows and Doors spokesperson and fire safety educator. "Make the time to help protect your loved ones. Consider what you can do to observe fire safety, as well as window and door safety."
Through its Close the door on fire® campaign, Pella encourages consumers to practice home safety year-round:
Identify, Prepare, Practice
- Evaluate fire safety risks inside your home and immediate surroundings. Equip your garage with smoke detectors since garage fires can start and spread quickly. Also, properly extinguish fire in indoor fireplaces or outdoor fire settings like grills or fire pits to help prevent the risk of fire spreading around your home or elsewhere. Check for local burn ban ordinances and follow them.
- Identify two exits - Designate two exits from every room in your home -- a door and a window. Make sure doors and windows open quickly and easily to help ensure a quick exit; if not, consider replacing them for safety's sake.
- Have a plan - Draw a floor plan of each level of your home. Before an emergency strikes, establish and communicate a meeting place a safe distance outside your home for your household members to gather in the event of a fire.
- Check the alarms - Install working smoke alarms in or near every sleeping area and on every level in your home. Test alarms monthly, change batteries regularly, and every 10 years replace alarms not permanently wired into your home's electrical system.
- Make smart purchases - Keep fire extinguishers in your home. If your home includes more than one story, consider keeping a fire escape ladder in bedrooms and sleeping areas to help prepare for an exit from an upper story in the event of an emergency. Mark their location on your home fire plan and share this information with those in your home. Since many fires start in the kitchen, keep a fire extinguisher in or near your kitchen.
- Test the alarm - Sound smoke alarms when household members are awake so everyone knows what they sound like, and test your family's ability to awaken to alarms during sleeping hours. If those in your home don't awaken easily, assign someone to awaken sound sleepers in the event of an emergency.
- Practice makes perfect - Practice your home fire escape plan with everyone in your home at least twice a year. Practice your plan first in the daytime, to familiarize everyone in your home with what to do in the event of a fire, and then at night, when most home fires occur.
Fire safety especially critical during drought
- Keep grass cut short around your home and property
- Remove dried leaves and other potentially flammable debris
- Clear debris from your home's gutters
- Trim and remove dead plant material, like trees and shrubs, from your landscaping
- Observe burn bans and refrain from starting outdoor fires, including campfires, fire pits and grills with exposed embers
Share window safety tips
- Keep children's play away from windows, doors and balconies.
- Teach people not to lean against a window screen. Insect screens are designed to keep bugs out, not to keep a person in a building.
- Keep windows closed and locked when not in use to let in fresh air. When opening windows for ventilation, open those that a child cannot reach like the upper sash on a double-hung window.
- Keep furniture like beds and dressers -- anything children can climb -- away from windows.
October 10, 2013 7:15 pm
Exclusive-right-to-sell listing. Listing that gives the broker the right to collect a commission no matter who sells the property during the listing period.