Refinance My Mortgage?  0

Posted on June 24th, 2007. About .

What is Mortgage Refinancing?

Read the entire article here.

Mortgage refinancing is when you take out a new loan to pay off the
existing one. There are many reasons home owners consider refinancing.

Let’s look at the 3 most common ones.

Refinance My Mortgage to Lower Monthly Payments

When there is some equity built up, it is possible to refinance your home mortgage to spread it out over a longer term. In this way you can ease your monthly burden. Individuals do this when they find themselves in a lower income situation, find they have added financial burdens such as offspring, to free up money for travel or leisure, or to be able to afford remodeling.

Refinance My Mortgage to Save Money

As lending rates fluctuate so does the cost of borrowing. As a result, if you make your original mortgage based on a high set of lending rates and the trend changes, pushing lending rates down you can save money by refinancing. Keep in mind that you will have to pay all the initial administrative fees associated with loans so the difference in rates should compensate for this expense.

Refinance My Mortgage for Remodeling

For a wide variety of reasons you may need or wish to do some major remodeling of your home. Perhaps your family has grown and you need to put up an addition or want a pool, rec. room, or home office. Refinancing to be able to afford large maintenance projects such as shingling, siding, window or door replacement can also be a wise move.

Refinancing can be a very smart move. Talk to your financial advice professional to find out if it can be right for you.

Mortgage Payoff  0

Posted on June 23rd, 2007. About .

When to Consider Mortgage Payoff

Read the entire article here

What is Mortgage Payoff?

Mortgage payoff is a financial maneuver whereby you pay slightly more each month in order to payoff your mortgage faster. For many people increasing the amount they pay on their mortgage is something that is very difficult to be able to afford. On the other hand, dividing the total amount in half and perhaps adding a little bit and making two smaller monthly payments seems much easier. Another option is making one mortgage payment every two weeks. This works particularly well for individuals who get paid every 2 weeks. Both of these options, while not adding a great deal to the amount you are paying per month result in a faster mortgage payoff because they do reduce the principle at a steady rate.

Why Do Mortgage Payoff?

Any little bit that you are able to afford to pay ahead on your mortgage will reap amazing savings over the term of your mortgage. Some mortgages only allow a certain amount of flexibility in the amount you are allowed to pay ahead. For that reason, you might want to discuss the wisdom of renegotiating your mortgage to allow better mortgage payoff options. The amount that you can save through mortgage payoff is likely well worth the refinancing fees. In most cases it is entirely possible to save in excess of $20,000 over the term of your mortgage. Not to mention that the length of the loan can be reduced by more than 2 years with a relatively small increase in payments.

The Home Appraisal Process  0

Posted on June 23rd, 2007. About .

Read the entire article here

The Appraisal Foundation – USPAP (Uniform Standards of Professional Appraisal Practice) defines an appraisal as “The act or process of developing an opinion of value.” This valuation is a determination of your property’s market value – what it will likely sell for on the open market. So how is this “valuation” determined? Why does the idea of getting an “opinion of value” create so much apprehension about the process? What can you do to make your home appraise better, if anything? What do you do if your home doesn’t appraise well? Below are commonly asked questions that hopefully will give some clarity about home appraisals.

What is a home appraisal?

A home appraisal is a survey of a home by a professional for their opinion of the property market value. In most cases an appraisal is done for a bank when a home is being approved for a loan for the home buyer. The home appraisal is a detailed report that looks at such items as the condition of the home, the neighborhood, what similar homes are selling for, and how quickly similar homes sell (to name a few). The appraisal may be a sales comparison or a cost/replacement opinion of value. There is also an income appraisal, but this is done primarily with commercial properties. The sales comparison will look at other properties in your neighborhood and what they are selling for and then figure how they compare to your home. With a cost/replacement opinion of value the appraiser is looking at what it would cost to replace the home if destroyed; this is more commonly used for new homes.
Important Note: An appraisal is not a home inspection! Appraisers only look for major concerns, they do not examine the home’s full condition (i.e. examine the roof, appliances, etc.). For this reason a home inspection should still be requested by the home buyer before purchasing the home.

Who is an appraiser?

Appraisers are licensed by individual states and are held to strict ethical standards. Appraisers are the third party whose purpose is to give their opinion of the market value of a home. Ideally the appraiser should not be connected with anyone involved with the home transaction.

Who picks the appraiser?

When an offer is made on the house the appraiser will normally be determined by the lender. The lender may have their own appraiser or contract with an independent party. Sometimes the bank will allow the seller to choose an appraiser, but only when that appraiser is already well known to them.

Can the seller get their own appraisal done?

Yes. The home seller may commission their own appraisal before selling the property to determine cost. However, this will cost anywhere from $300-500 and the bank most likely will not accept this appraisal but request another to be done by their own contact.

If not by appraisal, how do I set the price for my home?
Home sellers can set the price of their home with the help of a REALTOR(r) using a comparative market analysis (CMA); the CMA is not a substitute for an appraisal but will give a good idea on setting an asking price (usually 5-10% more than the market price for your area).

How can you prepare your home for appraisal?

Prepare for your home appraisal like you would for a home sale. You are in essence re-selling your home. Make sure all the maintenance you can do is done; this includes clearing and trimming the yard to painting the house – hopefully most of this was already done for the sale and should at most need only a minor touch up. Be polite to the appraiser and give them full access to your home; work with them not against. Inform the appraiser of your home improvements. Let them know about the new windows, new floors, the finished basement, etc. And finally, don’t be caught off guard. Do your homework! Know what similar homes are selling for in your neighborhood. This is something that should be done before setting your selling price. But in case your home has been on the market for a month or two, keep your research current. Let the appraiser know about similar homes and what they have sold for, especially if you know why a particular home that is like yours sold for less, let them know why your house is different.

What if the appraisal is low?

An appraisal that comes in lower then the asking price can jeopardize the loan and ultimately the sale. The lender will generally only loan up to 80% of the appraisers opinion of the home’s value. The most common result is that the seller can lower their asking price. Or the seller and buyer can negotiate and meet at a price in-between. If the buyer still wants the home badly enough, they may put more money down; but this may still not guarantee their loan as the lender will still view it as negative equity. The final option is to dispute the appraisal. Before disputing with an appraisal, do your homework. Look at the homes in your community that have sold in the last 6 months and see what the differences are that may make your home more valuable. Perhaps there is a sale that the appraiser missed, perhaps other homes do not have the renovations and improvements you have done, perhaps the appraiser is not familiar with your type of home or neighborhood, etc. Building this case may be a good idea even before the appraisal. This will prevent you from getting rushed by the timeline after the appraisal is done. This is something you can ask for your REALTOR(r) to help with as they usually have a vast knowledge of your market area. Once you have the case, present it to the lender. They will likely get a new appraiser or request the same appraiser to reconsider it. If you do not want the same appraiser, make sure to specify this and ask for a second opinion.

What other aspects of the appraisal can hurt the loan?

By in far, the appraisers opinion of the home’s value being lower than the asking price is the most detrimental. However, other factors may cause the lender to refuse the loan or require further contract negotiations. These concerns would result from property conditions that may require the home buyer to do more investing in the property to keep it valuable, such as upkeep on a private road. Your REALTOR(r) can help you with these types of objections and altering the contract to meet the lenders concerns.

Negotiating Your Homeowner’s Insurance Claim  0

Posted on June 19th, 2007. About .

Got Toxic Black Mold? Hail? Water Damage? ………………………………

Tips to Handle your Insurance Claim Properly #2

Read the entire article here

Negotiating a settlement with an insurance adjuster demands a business like attitude and a good understanding of the claims process. And of course, it takes preparation. To prepare for such negotiations there are three things to remember: know your rights, have thorough documentation, and be able to verify your claim. By being prepared in this way your negotiating skills will be utilized most effectively.

The dynamics of good negotiation are characterized by six interrelated elements; preparation, common sense, objectivity, principle, communication, and compromise.

Preparation is a must! Have all your documentation close at hand in order to substantiate your claim.

Common sense or good sound judgment will always be your best ally. Recognize what is relevant vs. irrelevant, material vs. immaterial, fact vs. fiction.

Be Objective. Objectivity is the concentrated effort to see things clearly and without bias or prejudice. By being objective you can easily identify whether statements are made in good faith. How do you maintain this objectivity? The most effective way is by sticking to the relevant issues of the claim, recognizing how your views are similar or dissimilar to the adjuster’s, avoiding the sway of emotion or pressure, not relying on unsubstantiated statements, and verifying statements through qualified sources.

At times it can be very challenging to maintain an objective attitude while negotiating. Your objectivity will be borne out by your open-mindedness toward the issues and your ability to recognize others perspective.

When settling your claim use a principled approach. Be sure that you, the adjuster, and others involved maintain a professional attitude. Be straight forward in your communications and do not become emotionally affected by unreasonable assertions. Do not yield to pressure, intimidation, evasion or unreasonable negotiation procedures.

Effective communication is a product of accessibility, having a positive attitude, and concentration. Accessibility is maintained by first finding out the adjuster’s daily routine. Adjuster’s work schedules are open. They do not punch a time-clock and are usually available at any reasonable hour.

Speak optimistically as though your every statement is simply a breath away from happening. Show confidence, carry a look of success, and espouse an attitude that the claim will be resolved only through fairness, honesty and reasonableness.

Compromise is not compliance! It is the ability to recognize two differing viewpoints, finding the most reasonable value for each and comparing them. The following example describes how to approach a compromise on the value of personal property, in this case an antique clock.

Identify Issues
The antique clock is 102 years old. It is located in an area of the home where it was seldom seen. The adjuster may contend that its usefulness is very little, therefor its value is low. Your view of the antique clock is based on characteristics of the antique clock itself. It is of Swiss origin, was a limited production, is a collectors item, and has been a family heirloom for generations.

Determine Value
Having identified the issues a reasonable value can then be placed on each. Those issues that are irrelevant or remote should be set aside. In this case the adjuster’s opinion of the usefulness, and your view of it’s sentimental value can be eliminated since they are not relevant to the value.

Compare & Compromise
Since the issues are clear and accountable the value attached to each can easily be determined by simply attaching a reasonable value to each. At this pint you and the adjuster can go over the prices together and calculate the results. You are entitled to have the actual cash value of an antique clock with the same options as the original and the adjuster is assured that their will be no sentimental value considered in the process.

Appraisal
What happens when agreement over the value of property cannot be reached?

Most policies have a provision which sets out a method to resolve such disputes. It is called the Appraisal Clause. It is used to decide those value issues that you and the adjuster cannot resolve between yourselves. It does not resolve any other type of disagreement such as liability, policy interpretation, etc.

It is unlikely that you or the insurer will opt for an appraisal. However, it is useful to you in the event that a disagreement in price is so significant that you would be less than fairly indemnified.

The procedure for appraisal is where you and the insurer each select an impartial individual. These two people are referred to as appraisers. They can be any competent and disinterested person so long as they exercise good judgment and impartiality. For example, a contractor or someone who is familiar with construction would act as a good appraiser since they have knowledge of the costs for materials, labor, licenses, etc. However, a contractor who has submitted a bid to you for restorations would not qualify since they have a financial interest in the outcome of the appraisal. The same holds true for an agent or employee of the insurance company. If you have reason to believe that an appraiser is not qualified, competent or impartial, provide written notice to that affect to the insurer immediately.

Once you have accepted the insurers appraiser and they have accepted yours, the two appraisers will then select one other person. If they cannot agree on someone you or the insurer can ask a local judge to select someone. This third appraiser is called an umpire. He will be used to break any deadlocks between the two appraisers.

You and the insurance adjuster will provide a list of the unresolved items to the appraisers and they will determine a fair price and resolve the dispute.

If you or the insurer request an appraisal timely notices must be made. Firstly, a written notice of intent must be sent by the party initiating the appraisal to the other. Secondly, within 20 days after receipt of this notice each party must provide the other with the identity of their appraiser. Thirdly, providing there is no disagreement regarding the qualifications of either appraiser, the appraisers must select an umpire within 15 days. Once that is done the two appraisers, with the help of the umpire if needed, will resolve the issues and notify you and the insurer of the results.

If it has been more than sixty days since you filed your Proof of Loss and the insurance company has not notified you of any dispute they have with your claim they waive their right to the appraisal process and are obligated to pay the full amount as you indicated in your Proof of Loss.

The costs for the appraisal are shared by both you and the insurer. You pay for your appraiser, the insurer pays for theirs. And the umpire costs are split between you and the insurer. The three are normally paid on an hourly basis plus expenses, and never on a commission basis.

The Insurance Claim Game  0

Posted on June 18th, 2007. About .

The objective of the insured consumer is to have their property returned to a pre-damaged condition.

Tips to Handle your Insurance Claim Properly #1

Check out the entire artcle here.

Also see Negotiating your claim.

The objective of the insurance adjuster is to minimize the claim payout.

WE HAVE, THEREFORE, AN ADVERSARIAL SITUATION.

The quicker the consumer understands and accepts this fact, the better. Begin by examining the entire claim process exclusively in terms of MONEY. It is your MONEY, and your insurance company wants to keep as much of it as possible. Of course you have lost irreplaceable belongings — family photographs, letters, and heirlooms. You have no place to live, no food, no medicine, and little clothing. You are emotionally devastated. You can’t sleep, and fail to think in terms of the tragedy equating to nothing more then MONEY.

Yet, MONEY is the focus of the adjuster; nothing more.

OBVIOUS FACTS:

The professional adjuster already knows the true damages and the total exposure of the company. Her objective is to minimize what is ultimately paid. The adjuster is required by State law to set “Reserves” (the amount they believe the claim will ultimately cost their company) immediately after inspection of the loss. The insurance adjuster wants the consumer to accept her recommendations on who establishes the building and contents claims. Why? Because the insurance company has control over what their “experts” determine the damages to be. The adjuster wants Contents Restoration firms she controls to immediately take possession of your personal property. Why? They now have “experts” on their side to establish what is and what is not “totaled,” and the condition of this property before they removed it from the loss site

HOW THE ADJUSTER SUCCEEDS

The adjuster must access the knowledge of the insured and play the game most appropriate to their end. The adjuster’s moves are dependent upon company “Guidelines” or “Claims Manuals.” Their objective is to keep the consumer off balance by creating confusion while appearing cooperative. (We describe it as: “smile a lot, utter nothingness, and place as little as possible in writing.”) To do so she will put as little as possible in writing thereby not committing to anything. This allows the adjuster to retain all options. The consumer is always in a defensive posture and usually does not know it. String the claim out as long as possible hoping the insureds will miss important time limits found in the policy which can invalidate all or part of the claim. Even when time limits do not pass, the consumer will be left with little time to properly establish damages when the adjuster finally discloses these limitations. The longer the claim goes on, with no commitments from the insurance company, the more options the company retains and hence, the better their negotiating position.

WHAT CAN THE CONSUMER DO?

1. The consumer must become the offensive player. They do so by:

(A). Establishing their own damages and presenting them timely and in a form required by the insurance contract, State Law, and current Case Law.

(B). Without properly presenting and itemizing your claim, the insurance company will never pay what the policy promises.

2. All communications are in writing; with verbal discussions documented in writing.

(A). The consumer needs to develop a documented “paper trail.

(B). Correspondence needs to be couched in verbiage found in the insurance policy, State Law and regulations, and be consistent with current Court decisions.

Home Equity Loans to Improve Landscaping  0

Posted on June 11th, 2007. About .

Article Provided by Our Partners at MortgageLoan.com

Give me the info I need to get a Real Grasp on ” Home Equity Loans to Improve my Landscaping! “

Landscaping is one of the easiest and least expensive ways to add value to your property. If you’re considering this option but are short of funds, you can pay for it by using a home equity loan or home equity line of credit. Who knows…by the time the project is finished, the actual equity in the house may have increased enough to pay for the whole endeavor!

Many homeowners hesitate to make landscaping improvements. They have concerns that undertaking such a major project may result in cost overruns, and cause them to run out of cash, leaving their yards unfinished and unsightly. However, if you negotiate a final price with local landscapers, and then secure a home equity loan or line of credit to cover the expenses, this kind of problem can be avoided. Most landscapers would rather work for a client who’s willing to sign a contract for the entire job—with money in hand—than to fill up their work calendars with jobs that can be cancelled or postponed at the last minute.

A bird in the hand is worth two in the bush, especially if it’s a bush in your garden. For busy landscape contractors, this means that a guaranteed job with payment in hand is worth more than ten jobs that are based on vague promises and “flowers in the sky.” Especially during the peak summer season, nothing cuts into a contractor’s productivity like clients who back out of projects that are already scheduled. If you show a real commitment by securing the funds through a home equity loan, you might rise to the top of your local landscape company’s job priority list, and even get a preferred customer discount from them.

Home Equity Loan to Prepare for a Sale

If you plan to sell your house, you can draw funds from your home equity line of credit and do a quick landscaping makeover. This may significantly improve your property, and attract a higher sale price, which could enable you to repay the loan before closing. Particularly in a competitive real estate market, an excellent landscaping job can bring more potential buyers in from the curb, and help clinch the sale.

Whether you plan to spruce up your property for “curb appeal,” or just want to beautify your backyard to take advantage of warm summer nights around the grill, a landscaping project based on a home equity loan can help you hit pay dirt. And it will ensure that you reach your goals of greening up your property without depleting the green from your bank account.

  0

Posted on June 9th, 2007. About .

Mold: Volatile Organic Compound’s & Mycotoxins : A Primer for Homeowners

by Randy Penn – www.Envirochex.com

Check Out The Entire Article Here.

Introduction

You can find a lot of information on mold, but trying to understand it may be difficult to those who didn’t take biology and chemistry. Even after stumbling through the pronunciation of these words, not everyone can comprehend what was meant by the statement.

“Satratoxin, a low-molecular weight non-volatile organically derived agent, belongs to the macrocyclic trichothecene class of mycotoxins generated from fungal microorganisms.”

As an aid to the homeowner, this overview is intended to explain a few bad products of mold in a less scientific manner. It will focus on those types of mold that have been considered as problematic to the “indoor mold issue” and does not address other fungal organisms which may behave differently. Analogies presented are not intended to be scientifically accurate, but rather to illustrate complex behaviors in more simple terms.

The people who study mold (mycologists) have identified and described over 100,000 species and many believe that this is only a partial listing (estimates of 1.5 million species have been suggested). Try jotting down the names of the first 100,000 people you know then describe each person’s behavior in a specific setting. You will begin to understand the complexities of the problem facing these mold professionals.

Most people have associated mold with allergies and these reactions are certainly prevalent with most all species found indoors. In addition to causing an allergic response, molds can be irritating, infectious and even toxic to humans. Understanding the general behavior of mold provides insight into the adverse components produced by mold.

The Organism

Fungi can be considered nature’s garbage disposal. Without them, the term “biodegradable” would not be so significant to our planet and we would have mountains of leaves, dead trees, and other organic materials sitting around…all deposited since the beginning of time. This, in simple terms, is the ‘why’ of mold. For the moment, think of mold as a weed. This weed has a root system, a vegetative stalk, and a seed pod.

For mold, the root system is made up of hyphae (high-fee). As hyphae grows into a mass during the vegetative state,it becomes a mycelium (my-sill-ee-um). The spores, designed for reproduction, are similar to seeds.

Like a weed, mold needs food and water to survive (yes, both need more than that, however, we are simplifying things here). For mold, the food of preference is organic matter (things that once were living). Indoors, those things are wood, paper, organic dust and dirt, leather, skin flakes, body oils, etc.

When mold spores that are floating around in the air land on a food source, they sit there patiently waiting for water. If the item they land on should contain sufficient moisture, or water comes from another source (leaks, etc.), the spore germinates and hyphae grows. The hyphae branch out, secrete enzymes to breakdown the food, form the mycelium, and absorb nutrients to grow. As long as the food and water hold out, colonies will continue to grow. Note that individual hyphae and spores are very, very small and few can see them without a microscope. When you see visible mold, you are generally seeing that mass of mycelium.

Hyphae can intertwine into the fibers of the substrate, penetrating the pores. As it consumes the substrate, it can also create it’s own route by dissolving pathways into the material. This is one of the reasons it is so difficult to kill and/or clean up mold on organic substrates. If you remove the surface growth, those bits of hyphae within the substrate are ready for re-growth upon the return of moisture.

As the organism matures, it develops spores intended for reproduction. Spores vary in size, shape, weight and methods of distribution. Some are light and buoyant so they float easily through the air. Others are wet and sticky and may cling to insects, rodents, etc. as a mode of travel.

Volatile Organic Compounds

As mold “consumes” it’s food, the chemical reactions of enzymes, substrates and mold growth produce carbon dioxide, water, and volatile organic compounds (VOC’s). Because these items are a result of actions essential to the growth of the organism, they are classified as primary metabolites.

For mold, many types of VOC’s are produced and typically include aldehydes, alcohols, keytones, and hydrocarbons. They have complex structures and names like “2-methyl-1-propanol”, so if you are going to dig deeper into VOC’s, get ready for chemistry class.

They are called volatile in that they evaporate easily at room temperature and pressure. Fortunately, this volatility aids in dilution with fresh air to minimize concentrated build-up of these chemicals. Testing for VOC’s is often accomplished by using vacuum cylinders to obtain samples of the air with laboratory analysis obtained from sophisticated test instruments (gas chromatograph/mass spectrometer).

When you smell a “musty-moldy” odor, it’s generally the VOC’s you are noticing. VOC’s are often considered irritants to mucus membranes, however, are also capable of both short-term and long-term adverse health effects. If you do smell these odors, it’s a sure sign the mold is consuming and growing and you need to take action. (Note that VOC’s may also be derived from non-mold sources including natural materials used in cleaning agents.)

Toxins

Many molds are capable of producing compounds called mycotoxins which are toxic to other organisms, including people. Mycologists believe these toxins are produced as protection against competing organisms and therefore, humans are simply caught in the cross-fire of this fight for survival.

Since these toxins are not essential for growth, they are classified as secondary metabolites. Toxic secondary metabolites require extra work on the part of the organism so production does not occur at all times, or, with all types of mold.

Scientists have identified over 400 mycotoxins and unlike VOC’s, these compounds are usually non-volatile (don’t evaporate easily at room temperature and pressure). One strain of mold may produce multiple toxins and one type of toxin may be produced by multiple strains of mold. Research has indicated that the type of substrate (nutrients), the growing conditions, together with the species of mold, will impact which toxins are created.

Some of these toxic substances are considered extremely hazardous to people, unfortunately, quantified human dose-response data is limited. Lab and field studies have shown these compounds to produce severe toxic effects in both animals and humans and therefore, the general recommendation is to minimize exposure to potentially toxigenic mold. Symptoms from toxic exposure range from flu-like symptoms, skin rashes and lesions, bleeding, fatigue, difficulty breathing, depression, etc. to longer-term nerve and organ problems, altered immunity, and cancer.

Not all secondary metabolites are considered bad for people…the antibiotics such as penicillin have beneficial use. However, from the mycological standpoint, antibiotics are considered mycotoxins since they too are generated by mold to ward off microorganisms (i.e. competing bacteria).

When the organism is producing toxins, the toxins are known to be present in the cell wall of spores and hyphae. It’s relatively easy to test for spores and hyphae, however, testing these components to see if they contain toxins is significantly more complex. Whereas a single spore can be viewed under a microscope, identifying what compounds are contained in the cell wall is difficult.

In order to identify these toxic compounds, laboratories must have a sufficient quantity of toxin-containing spores and carefully process them through sophisticated and expensive equipment that is capable of isolating chemicals down to billionths of an gram (remember, mold spores are microscopic so what is contained within it’s cell wall is extremely small). This testing is made even more difficult since there are a few hundred toxins to analyze and the behavior of mold is such that a toxin-producing mold in the field doesn’t necessarily produce the same type and quantity of toxins in the lab.

Generally speaking, identifying a mold type that is known to be capable of producing toxins is sufficient information to warrant precautions and avoid exposure without submitting for toxic analysis. However, if trying to confirm specific adverse health effects, obtaining an analysis of both VOC’s and toxins can be beneficial but often expensive.

Randy Penn is an independent licensed real estate inspector (Texas #5491) who specializes in mold testing and specimen recovery. He has a Bachelor of Science degree in engineering, is a member of the Indoor Air Quality Association, has invested hundreds of hours in researching and training on fungal microorganisms, has completed IAQA’s workshop on mold remediation and has provided mold related presentations to homeowners and real estate professionals.

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