Each month, we publish a series of articles of interest to homeowners -- money-saving tips, household safety checklists, home improvement advice, real estate insider secrets, etc. Whether you currently are in the market for a new home, or not, we hope that this information is of value to you. Please feel free to pass these articles on to your family and friends.

ISSUE #1241
FEATURE REPORT

Fixing Up Your Home: Protect Your Housing Investment
Your home is an investment in living as well as in savings. If neglected, it will pay no dividends. If properly maintained and improved, it will pay a high yield in comfort and usefulness for your family and in avoidance of costly repair bills. Home improvements also tend to raise neighborhood standards and, as a result, property values. From an economic standpoint, home improvements mean higher employment, increased markets for materials and home products--and therefore a more flourishing community.




Also This Month...
11 Things You Need to Know to Pass Your Home Inspection
According to industry experts, there are at least 33 physical problems that will come under scrutiny during a home inspection. We've identified the 11 most common of these and, if not identified and dealt with, any of these 11 items could cost you dearly in terms of repair.


 
 

10 Questions To Ask When Choosing A Financial Planner
You may be considering help from a financial planner for a number of reasons, whether it's deciding to buy a new home, planning for retirement or your children's education, or simply not having the time or expertise to get your finances in order. Whatever your needs, working with a financial planner can be a helpful step in securing your financial future.


Quick Links
Fixing Up Your Home: Protect Your Housing Investment
11 Things You Need to Know to Pass Your Home Inspection
10 Questions To Ask When Choosing A Financial Planner
 

 

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Fixing Up Your Home: Protect Your Housing Investment

Your home is an investment in living as well as in savings. If neglected, it will pay no dividends. If properly maintained and improved, it will pay a high yield in comfort and usefulness for your family and in avoidance of costly repair bills. Home improvements also tend to raise neighborhood standards and, as a result, property values. From an economic standpoint, home improvements mean higher employment, increased markets for materials and home products--and therefore a more flourishing community. 

If You Do It Yourself 

If you are handy with tools and have the experience, you can save money by doing many jobs yourself. But unless you are skilled in wiring, plumbing, installing heat systems, and cutting through walls, you should rely on professionals for such work. 

When you buy the required materials, it pays not to skimp. Good materials are not necessarily the most expensive. What you need are products that look good, are easy to maintain, and last a long time. Buy only from reliable dealers. 

If You Use a Contractor 

If you plan to use the services of a dealer or contractor, take care to choose one with a reputation for honesty and good workmanship. There are several ways to check on a contractor: 

  • Consult your local Chamber of Commerce, the Better Business Bureau, or Local Consumer Protection Agency.
  • Talk with people for whom he has done work. 
  • Ask your lender about him, if you plan to finance the project with a loan. 
  • Check his place of business to see that he is not a fly-by-night operator. 
  • Find out, if you can, how he rates with known building-product distributors and wholesale suppliers. 
  • Ask friends and relatives for names of firms that they could recommend. 
Compare Contractor Offers 

Before deciding on a contractor, you may want to get bids from two or three different firms. Make sure that each bid is based on the same specifications and the same grade of materials. If these bids vary widely, find out why. 

Many contractors offer package plans that cover the whole transaction. Under such a plan the contractor provides all materials used, takes care of all work involved, and arranges for your loan. 

Your contractor can make the loan application for you, but you are the one who must repay the loan, so you should see that the work is done correctly. 

Understand What You Sign 

The contract that both you and the contractor sign should state clearly the type and extent of improvements to be made and the materials to be used. Before you sign, get the contractor to spell out for you in exact terms: 

  • How much the entire job will cost you. 
  • How much interest you will pay on the loan. 
  • How much you will pay in service charges. 
  • How many payments you must make to pay off the loan, and how much each of these payments will be. 

After the entire job is finished in the manner set forth in your contract, you sign a completion certificate. By signing this paper you certify that you approve the work and materials and you authorize the lender to pay the contractor the money you borrowed. 

Beware of Fraud 

Most dealers and contractors conscientiously try to give their customers service equivalent to the full value of their money. Unfortunately, home improvement rackets do exist. Here are a few common sense rules to follow: 

  • Read and understand every word of any contract or other paper before you sign it. 
  • Never sign a contract with anyone who makes fantastic promises. Reputable dealers are not running give-away businesses. 
  • Avoid wild bargains. The best bargain is a good job. 
  • Never consolidate existing loans through a home improvement contractor. 
  • Do not let salespeople high-pressure you into signing up to buy their materials or services. 
  • Be wary of salespeople who try to scare you into signing for repairs that they say are urgent. Seek the advice of an expert as to how urgent such repairs are. High-pressure and scare tactics are often the mark of a phony deal. 
  • Avoid salespeople who offer you trial purchases or some form of bonus, such as cash, for allowing them to use your house as a model for any purpose. Such offers are well-known gimmicks of swindlers. 
  • Never sign a completion certificate until all the work called for in the contract has been completed to your satisfaction. Be careful not to sign a completion certificate along with a sales order. 
  • Proceed cautiously when the lender or contractor demands a lien on your property.

 

 
 

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11 Things You Need to Know to Pass Your Home Inspection

 

"According to industry experts, there are at least 33 physical problems that will come under scrutiny during a home inspection when your home is for sale. Here are 11 you should know about if you're planning to put your home up for sale."

  

Homebuyers Want to Know Your Home Inside and Out

While homebuyers are as individual as the homes they plan on purchasing, one thing they share is a desire to ensure that the home they will call their own is as good beneath the surface as it appears to be. Will the roof end up leaking? Is the wiring safe? What about the plumbing?  These, and others, are the questions that the buyers looking at your home will seek professional help to answer.

According to industry experts, there are at least 33 physical problems that will come under scrutiny during a home inspection. We've identified the 11 most common of these and, if not identified and dealt with, any of these 11 items could cost you dearly in terms of repair.

In most cases, you can make a reasonable pre-inspection yourself if you know what you're looking for. And knowing what you’re looking for can help you prevent little problems from growing into costly and unmanageable ones.

11 Things You Need to Know to Pass Your Home Inspection

1. Defective Plumbing

Defective plumbing can manifest itself in two different ways: leaking, and clogging. A visual inspection can detect leaking, and an inspector will gauge water pressure by turning on all faucets in the highest bathroom and then flushing the toilet. If you hear the sound of running water, it indicates that the pipes are undersized. If the water appears dirty when first turned on at the faucet, this is a good indication that the pipes are rusting, which can result in severe water quality problems.

2. Damp or Wet Basement

An inspector will check your walls for a powdery white mineral deposit a few inches off the floor, and will look to see if you feel secure enough to store things right on your basement floor. A mildew odor is almost impossible to eliminate, and an inspector will certainly be conscious of it.

It could cost you $200-$1,000 to seal a crack in or around your basement foundation depending on severity and location. Adding a sump pump and pit could run you around $750 - $1,000, and complete waterproofing (of an average 3 bedroom home) could amount to $5,000-$15,000. You will have to weigh these figures into the calculation of what price you want to net on your home.

3. Inadequate Wiring & Electrical

Your home should have a minimum of 100 amps service, and this should be clearly marked. Wire should be copper or aluminum. Home inspectors will look at octopus plugs as indicative of inadequate circuits and a potential fire hazard.

4. Poor Heating & Cooling Systems

Insufficient insulation, and an inadequate or a poorly functioning heating system, are the most common causes of poor heating. While an adequately clean furnace, without rust on the heat exchanger, usually has life left in it, an inspector will be asking and checking to see if your furnace is over its typical life span of 15-25 yrs. For a forced air gas system, a heat exchanger will come under particular scrutiny since one that is cracked can emit deadly carbon monoxide into the home. These heat exchangers must be replaced if damaged -they cannot be repaired.

5. Roofing Problems

Water leakage through the roof can occur for a variety of reasons such as physical deterioration of the asphalt shingles (e.g. curling or splitting), or mechanical damage from a wind storm. When gutters leak and downspouts allow water to run down and through the exterior walls, this external problem becomes a major internal one.

6. Damp Attic Spaces

Aside from basement dampness, problems with ventilation, insulation and vapor barriers can cause water, moisture, mould and mildew to form in the attic. This can lead to premature wear of the roof, structure and building materials. The cost to fix this damage could easily run over $2,500.

7. Rotting Wood

This can occur in many places (door or window frames, trim, siding, decks and fences). The building inspector will sometimes probe the wood to see if this is present - especially when wood has been freshly painted.

8. Masonry Work

Re-bricking can be costly, but, left unattended, these repairs can cause problems with water and moisture penetration into the home which in turn could lead to a chimney being clogged by fallen bricks or even a chimney which falls onto the roof. It can be costly to rebuild a chimney or to have it repainted.

9. Unsafe or Over-fused Electrical Circuit

A fire hazard is created when more amperage is drawn on the circuit than was intended. 15 amp circuits are the most common in a typical home, with larger service for large appliances such as stoves and dryers. It can cost several hundred dollars to replace your fuse panel with a circuit panel.

10. Adequate Security Features

More than a purchased security system, an inspector will look for the basic safety features that will protect your home such as proper locks on windows and patio doors, dead bolts on the doors, smoke and even carbon monoxide detectors in every bedroom and on every level. Even though pricing will vary, these components will add to your costs. Before purchasing or installing, you should check with your local experts.

11. Structural/Foundation Problems

An inspector will certainly investigate the underlying footing and foundation of your home as structural integrity is fundamental to your home.

When you put your home on the market, you don't want any unpleasant surprises that could cost you the sale of your home. By having an understanding of these 11 problem areas as you walk through your home, you'll be arming yourself against future disappointment.

 
 

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10 Questions To Ask When Choosing A Financial Planner

These questions will help you interview and evaluate several financial planners to find the one that's right for you. You will want to select a competent, qualified professional with whom you feel comfortable, one whose business style suits your financial planning needs. An interview checklist has been included for your convenience.

1. What experience do you have?

Find out how long the planner has been in practice and the number and types of companies with which she has been associated. Ask the planner to briefly describe her work experience and how it relates to her current practice. Choose a financial planner who has a minimum of three years experience counseling individuals on their financial needs.

2. What are your qualifications?

The term "financial planner" is used by many financial professionals. Ask the planner what qualifies him to offer financial planning advice and whether he holds a financial planning designation such as the Certified Financial Planner mark. Look for a planner who has proven experience in financial planning topics such as insurance, tax planning, investments, estate planning or retirement planning. Determine what steps the planner takes to stay current with changes and developments in the financial planning field. If the planner holds a financial planning designation, check on his background with the CFP Board or other relevant professional organizations.

3. What services do you offer?

The services a financial planner offers depend on a number of factors including credentials, licenses and areas of expertise. Financial planners cannot sell insurance or securities products such as mutual funds or stocks without the proper licenses, or give investment advice unless registered with state or Federal authorities. Some planners offer financial planning advice on a range of topics but do not sell financial products. Others may provide advice only in specific areas such as estate planning or on tax matters.

4. What is your approach to financial planning?

Ask the financial planner about the type of clients and financial situations she typically likes to work with. Some planners prefer to develop one plan by bringing together all of your financial goals. Others provide advice on specific areas, as needed. Make sure the planner's viewpoint on investing is not too cautious or overly aggressive for you. Some planners require you to have a certain net worth before offering services. Find out if the planner will carry out the financial recommendations developed for you or refer you to others who will do so.

5. Will you be the only person working with me?

The financial planner may work with you himself or have others in the office assist him. You may want to meet everyone who will be working with you. If the planner works with professionals outside his own practice (such as attorneys, insurance agents or tax specialists) to develop or carry out financial planning recommendations, get a list of their names to check on their backgrounds.

6. How will I pay for your services?

As part of your financial planning agreement, the financial planner should clearly tell you in writing how she will be paid for the services to be provided. Planners can be paid in several ways:

  • a salary paid by the company for which the planner works. The planner's employer receives payment from you or others, either in fees or commissions, in order to pay the planner's salary.
  • fees based on an hourly rate, a flat rate, or on a percentage of your assets and/or income.
  • commissions paid by a third party from the products sold to you to carry out the financial planning recommendations. Commissions are usually a percentage of the amount you invest in a product.
  • a combination of fees and commissions whereby fees are charged for the amount of work done to develop financial planning recommendations and commissions are received from any products sold. In addition, some planners may offset some portion of the fees you pay if they receive commissions for carrying out their recommendations.
7. How much do you typically charge?

While the amount you pay the planner will depend on your particular needs, the financial planner should be able to provide you with an estimate of possible costs based on the work to be performed. Such costs would include the planner's hourly rates or flat fees or the percentage he would receive as commission on products you may purchase as part of the financial planning recommendations.

8. Could anyone besides me benefit from your recommendations?

Some business relationships or partnerships that a planner has could affect her professional judgment while working with you, inhibiting the planner from acting in your best interest. Ask the planner to provide you with a description of her conflicts of interest in writing. For example, financial planners who sell insurance policies, securities or mutual funds have a business relationship with the companies that provide these financial products. The planner may also have relationships or partnerships that should be disclosed to you, such as business she receives for referring you to an insurance agent, accountant or attorney for implementation of planning suggestions.

9. Have you ever been publicly disciplined for any unlawful or unethical actions in your professional career?

Several government and professional regulatory organizations, keep records on the disciplinary history of financial planners and advisers. Ask what organizations the planner is regulated by, and contact these groups to conduct a background check.

10. Can I have it in writing?

Ask the planner to provide you with a written agreement that details the services that will be provided. Keep this document in your files for future reference.

 
 

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