Gunning Daily News
January 4, 2012 5:24 pm
Q: When buying a home, what are some negotiating tips?
A: Know the seller's motivation to sell. This will enhance your negotiating position. Sellers who must move quickly due to a job transfer, divorce, or contract on another home, are more inclined to accept a lower price to speed the process along.
Remember, too, that the listing, or asking, price is what the seller would like to receive for the home. It is not necessarily what the seller will settle for. So know value. Before you make an offer, check recent sales and listing prices of comparable neighborhood homes and compare them to the seller's asking price.
• Be flexible. Never say, “take it or leave it.” That can sour negotiations and ruin the deal.
• Never show your hand or reveal your next step.
• Each time you increase your offering price, ask for something in return, such as repairs, appliances, even lawn furniture.
• If you plan to pay cash or have a tentative commitment for a loan, use your strong financial position as a negotiating tool.
• Don’t let emotions such as pride, fear, love, and anger get in the way of negotiating the best deal. Leave irrational feelings at home.
January 3, 2012 5:38 pm
EnergyStar, a division of the Environmental Protection Agency, reports the average family spends $2,200 annually on energy costs. But, says the agency, which is charged with helping consumers keep energy costs down, most families can save about $700 a year—nearly a third of the annual outlay—without sacrificing comfort.
Here are five ways you can cut costs without significantly changing your lifestyle:
• Heating and air conditioning – These systems alone account for some 46 percent of your energy bill. To save big bucks, install a programmable thermostat, change air filters monthly, and seal off heating and cooling ducts that go to little-used areas of your home—such as attics, crawlspaces, and spare, infrequently used bedrooms.
• Lighting – You can save up to 12 percent of your energy costs simply by replacing five incandescent light bulbs with energy-saving fluorescents.
• Water heaters – Setting your water heater to 120 degrees Fahrenheit can shave as much as $60 per year off your energy bill. Many water heaters are routinely—and unnecessarily—set to 140 degrees.
• Major appliances – Energy costs for running the refrigerator, washer and dryer account for only about 12 percent of your annual bill. You can save a little of that by keeping the filters clean and using cold water only for some wash loads. But newer models are more energy-efficient, and older appliances can be money-suckers. Replacing larger appliances that are more than 10-15 years old can save you money in the long run.
• Small electronics – All appliances use energy when they are plugged in. Turn off the TV, computer and DVD when not in use. Unplug the toaster and coffeemaker after they’ve done their morning duty. Unplug video game consoles when not in use—and use the stand-by mode sparingly.
January 3, 2012 5:38 pm
Last year, your RIS Consumer Confidant wrote about an anticipated glut of so-called McMansions, or giant 5,000-plus-square-foot homes that were a major by-product of the mid- to late-1990s housing boom. So it was interesting to run across a recent post from Vanessa Pereira, an Interior Design Consultant at Mid-Atlantic Builders Rockville, MD (midatlanticbuilders.com) about trending home sizes.
Pereira reports that recent national surveys along with 2010 census data confirm there are rapid changes happening throughout the nation, with many homebuyers opting for smaller, more efficient and easy to maintain homes.
She says that architectural footprints of new homes are shrinking, and builders are squeezing the most out of every inch of usable square footage.
That means two-story spaces are now viewed as wasted areas, an open family room can be used for an extra bedroom, and two-story foyers are now being used for extra closet space. In fact, Pereira says that more than half of the buyers she helps end up customizing floor plans using open spaces to create a bigger master bedrooms, more storage spaces or extra bathrooms.
Speaking of extra bathrooms, Pereira says the days of those big Jacuzzi tubs are over. Today, many builders are opting for bigger showers with “spa-like” features.
Although many buyers are hanging onto their Jacuzzi tubs for reasons such as perceived resale value, fewer and fewer buyers are spending the extra money to add massage jets to the tubs, according to Pereira. Younger buyers are now opting for more lifestyle-related options such as body jets, rain showerheads and steam showers.
Even the formal living and dining areas are being replaced by or converted to big, open family rooms.
Pereira says keeping with the trend of functionality, homebuyers now understand that they spend most of their time in their kitchen and family room. So most buyers want to use the living room for other purposes, such as a guest area or other multifunctional area, and keep their kitchen open to the family room.
January 3, 2012 5:38 pm
Winter has barely started, yet already more than 10 incidents involving falls through ice, several of them fatal, have been reported in the news media. Experts blame unseasonably warm temperatures and alternate freezing and thawing for the dangerous conditions.
"We urge everyone to stay off all frozen bodies of water," says Kim Burgess, executive director of the National Drowning Prevention Alliance. "The perceived recreational benefit is simply not worth the risk to yourself or your loved ones."
"It's also important to prevent pets from roaming onto ice," adds NDPA Board Member Gerald M. Dworkin, an aquatics safety and water rescue consultant at Lifesaving Resources LLC. "More than half of ice emergency 911 calls are triggered by people trying to save a pet who fell through ice. Never attempt to rescue an animal yourself, but rather, call 911."
"Ice seldom freezes uniformly," explains Dworkin. "It will be thinner when it has formed over moving water, and where it surrounds partially submerged objects." He adds that snow-covered ice, and ice that has thawed and refrozen is not as strong as new, clear, hard ice.
Dworkin offers the following self-rescue and response tips:
If you fall through ice:
• Don't try to climb out immediately. Instead, kick to get horizontal in the water with your legs behind your torso. Then, try to pull yourself forward onto solid ice.
• Once out of the water, roll away and avoid standing until you are several body lengths away from the ice break.
• A set of ice picks is an ideal safety tool for rescuers and victims alike. When the ice pick is jammed on the ice, the retractable sheath exposes the pick. This allows a rescuer to crawl out to the victim, or gives a victim the opportunity to crawl his way out of the ice hole.
When trying to rescue a person who has fallen through ice:
• Call, or have someone call 911 first.
• Try to improvise a buoyant throwing assist, such as an empty jug with a line attached.
• If going onto ice to reach a victim is unavoidable, use a device to distribute the rescuer's weight over a wide area.
• Use a reaching assist to prevent the rescuer from being dragged into the water by the victim.
"All first responders should be trained and equipped for ice rescue," says Dworkin. "Ice rescue suits, ice picks, water rescue rope, and an animal control stick are the minimum equipment needed."
For more information visit http://www.lifesaving.com.
January 3, 2012 5:38 pm
As we enter the new year, a top resolution for 2012 is to consolidate credit card debt.
While there are many tactics to improve credit, balance transfers are becoming an increasingly popular way to reign in high interest rates. However, reducing outstanding debt is not always as easy as switching cards.
With 42.3 percent of American families in credit card debt, outstanding revolving credit card debt at $793.4 billion and the nationwide credit card APRs averaging 13.08 percent, according to the U.S. Federal Reserve, January is a hot time for card issuers to lure people from their current cards with promotional interest rates as low as zero.
"Balance transfers are a smart financial choice for many consumers, provided they read the agreement's fine print and are able to pay down their balances before the low introductory rate offers expire," says Charles Tran, founder of CreditDonkey.com, a consumer credit card comparison and education site. "In most cases, balance transfers represent an interest-free loan during the introductory period, but if consumers use that relief to simply continue uncontrolled spending, they will easily get deeper in debt."
Before making a balance transfer, consumers should follow these five tips:
1. Know the Interest Rates: Review the card's terms and conditions to learn if you will be charged a balance transfer fee. Fees typically range from 3 to 5 percent of the total balance. Check the length of introductory period and find out the post-introductory-period APR. If you cannot pay off the balance before this expires, your new card might become more costly than the old one.
2. Don't Take Teaser Rates at Face Value: Determine if the low- or no-interest rate promotion also applies to new purchases. Some companies charge their usual rates on purchases.
3. Know Your Fees: Understand the different fees—balance transfer fees, annual fees, and minimum finance changes. As a result of the new regulations from the Credit CARD Act, credit card companies have raised or added new fees.
4. Be Aware of Changes: Remember that the terms of the credit card can change over time, so consumers should stay current on the newest changes.
5. Read Reviews Before Transferring: Today it is easy, and equally important, to compare reviews and benefits of the cards so you can be sure the new card is the right fit for you.
"Until recently, many 0 percent interest credit cards were limited to short periods such as 12 months," says Tran, "but now credit card issuers are offering big incentives such as 0 percent for 21 months to try to get consumers to transfer their balance."
Balance transfers are more appropriate for consumers who can pay off the balance before the introductory period ends, control their spending, and those with a good credit score who can secure a better post-introductory interest rate. If a consumer does not meet these criteria, they should think twice before they enter the balance transfer game.
And for consumers already in the balance transfer game, CreditDonkey.com provides five strategies to help stay ahead:
• Don't be Late: Pay your bills on time to avoid late fees and penalties that can increase the interest rate.
• Pay down the Balance: Just paying the minimum payment will not resolve your debt problem.
• Separate Your Debts: If you cannot get a low interest credit card on all transactions –such as purchases, balance transfers and cash advances, use separate cards with the most favorable terms for different transactions.
• Make it a Good Ending: A month or two before the introductory period ends, make plans so you are not stuck with a high interest rate you cannot afford. Decide if you should keep this card and the new high rate or begin a new balance transfer.
• Know Your Rights: For other consumer benefits of the new Credit Card Accountability Responsibility and Disclosure Act, visit http://www.federalreserve.gov/consumerinfo/wyntk_creditcardrules.htm
"If you 'play your cards right,' balance transfers can save you money and consolidate your debt," says Tran, "but consumers should understand that using them too often can result in a lowered credit score."
For more information, visit http://www.creditdonkey.com.
January 3, 2012 5:38 pm
Steering- The illegal practice of directing potential home buyers to or away from certain neighborhoods either to maintain or to change the character of an area, or to create a speculative situation.
January 3, 2012 5:38 pm
Q: Can you negotiate interest rates?
A: A few lenders will negotiate the mortgage rate and number of points on a loan. However, this is more the exception than the rule with established lenders. As always, shop around and know the market before you enter a lender’s office. Rates are often published in local newspapers and on Internet Web sites.
You may have more luck when dealing directly with a seller who has agreed to finance your loan. He is likely to be more open to negotiation, particularly when motivated to make a quick sale.
December 21, 2011 5:32 pm
Q: Is private mortgage insurance necessary?
A: Lenders require private mortgage insurance (PMI) on most conventional loans with less than a 20 percent down payment. They believe there is a correlation between borrower equity and default. They have found that the less money borrowers put down, the more likely they are to default on a loan. PMI guarantees the lender will not lose money if this happens and a foreclosure is necessary.
The buyer pays this insurance, usually a small fee at the outset and a percentage of the face amount of the loan that is added to the monthly payment.
What most homeowners do not realize is that the insurance is usually no longer necessary after enough equity has built up in the property. Contact your lender if you meet this requirement and want to drop PMI.
A precaution: do not confuse PMI with mortgage life insurance. The latter pays all, or a portion, of your mortgage in the event of your death.
December 21, 2011 5:02 pm
While it doesn't take a rocket scientist to figure out that men and women have different approaches to nearly every situation, what's interesting to see is where the differences lie, and how it affects their decisions when buying a home.
A 2007 Royal LePage survey found that 30 percent of single women already owned their own home. With the demographics of homebuyers changing, a prominent real estate company recently decided to commission a survey in 2009 to discover to what extent men and women differed when it came to buying a home. The results were sometimes fairly surprising!
Some key observations
• Women tended to decide quicker
• Location: women want to be closer to extended family; men want to be closer to workplace
• Security: both agreed this was a major factor
• Both sides claimed major financial decisions were reached mutually
• Both parties agreed on how to utilize a spare room
Quicker Decision Making
Interestingly, 70 percent of women said they had pretty much made up their minds about buying a home from the day they viewed it, whereas for men, it was only 62 percent. Furthermore, more men needed to go back for another two or three visits (32 percent as opposed to 23 percent of women) before reaching a final decision. Keep that in mind, ladies, the next time your guy complains about how long you spend looking at shoes.
Men like to be practical, right? Being close to work is practical. Cut down on the morning commute, less time on the road, and so on. Women, on the other hand, prefer being closer to extended family. According to statistics, 55 percent of women felt this was an important factor when buying a home while only 37 percent of men agreed.
This is one area where both sides agree closely on. Security plays such an important role in today's society that 64 percent of women said they would forgo their dream home if it didn't meet their security requirements. And guess what? 51 percent of men agreed.
Making the major financial decisions when buying a home
This one revealed a lot about the respondents! While 70 percent of those surveyed said that major financial decisions were reached mutually, there's actually a little more to this story. When questioned further, 26 percent of men thought that they, in fact, were the major decision-makers in the relationship while 20 percent of women felt the same about themselves. It's best to leave this one alone, I think…
Utilizing a spare room
This is one area where you would think there would be significant differences but there weren't. Both sides felt that an extra room (12 x 12) should be used for:
• Choice 1 (25 percent) - bedroom
• Choice 2 (15 percent) - office/study
• Choice 3 (11 percent) - family room/den
Although men and women tend to look for different things when buying a home, there is also much they have in common. And that's where the value of working with a real estate professional comes in. "A good REALTOR® will take both parties' concerns and preferences into account, and find a compromise solution that addresses everyone's wants and needs," says Andrew Brest, vice president of marketing of Sundaybell Inc., an online company specializing in matching homebuyers and sellers with their ideal agent. Lee Redwood, Sundaybell's vice president of sales agrees. "A part of an agent's job is to sometimes act as a bridge between partners, helping them to understand the other's point of view."
Which can be very important, you'll agree, if you're going to be sharing closet space!
December 21, 2011 5:02 pm
As the holiday season approaches, many are busy getting their homes ready for visiting friends and family. Having multiple generations under one roof takes some planning, and it's helpful to plan ahead for elderly visitors to ensure your home is as safe as possible.
"Don't let a nasty accident ruin the holiday cheer in your home," said Merri Dee, AARP Illinois state president. "All it takes is just a few simple steps to help ensure your home is safe for elderly visitors."
Below are five steps that AARP recommends for making your home safe for older guests:
Be clutter-free with bins.
If you're used to leaving toys, clothes and other objects lying on the floor, now more than ever, you'll need to start picking them up. Pick a spot that's out of the way and set up a large basket to serve as a catchall for things that tend to end up on the floor.
Prevent slips and falls with anti-slip mats, grab bars and adhesive strips.
Anti-slip mats, often made of rubber or a similar material, fit under throw rugs to increase traction, and greatly decrease the chances of a fall. Removing throw rugs also solves the problem—provided that they weren't covering slick, waxed wood floors, which can also be a hazard. In the bathroom, grab bars in the tub or shower and beside the toilet are lifesavers and help prevent falls. Low-cost, no-slip adhesive strips also can decrease the risk of slippery bathroom areas and steps.
Soften edges with furniture bumpers.
Use clear plastic bumpers that fit over sharp furniture corners to prevent injury. Alternatively, remove sharp-edged furniture from the room. Unsteady chairs should be replaced as well.
Stay cool with anti-scalding devices.
These inexpensive devices (about $40) automatically turn off the water if it gets too hot. They can easily be installed on faucets in your kitchen or on showers and tubs. Alternatively, turn down the thermostat on your hot-water heater so the water never gets above 120 degrees Fahrenheit.
Light the way.
It's not just the rooms in your house that need to be well-lit: Make sure walkways, hallways and entryways are illuminated, too. Lighting should be bright but not harsh or blinding.