Realty World Selzer Realty

Insurance Questions

Patty McMillen — Thu, 23 May 2013 23:16:00 +0000

Insurance can be complicated, that’s why it’s important to learn as much as you can about your insurance coverage. Don’t let misinformation or disinformation lead you to inappropriate decisions — the more you know the better you can prepare. Take a look at the following questions and see if you can determine which are true and which are fiction:

True or false: Red cars cost more to insure. Insurance companies will likely not even ask the color of your car when they’re calculating your insurance premium. They’re interested in the year, make, model, body type, engine size, age of your vehicle, where you live, your driving record and the like. Red won’t cost you more green.
True or false: Raising your deductible lowers your premium. By requesting a higher deductible — the portion you pay before your insurance coverage kicks in — you can typically lower your premium. For example, you may consider going from a $500 deductible to a $1,000 deductible. But before you do, make sure you have the funds set aside to cover your portion in case you have a claim.
True or false: Home insurance offers coverage for floods. A standard homeowners policy covers water damage that originates inside your home but you need a separate policy for flood — to cover damage from waters rising outside of your home. Farmers flood insurance may be available for both residential and non-residential buildings.
True or false: My landlord’s insurance will cover my belongings. It’s your stuff — typically your landlord’s insurance isn’t designed to cover it. But renters insurance is — providing coverage for your household contents and personal belongings.1

MEMORIAL WEEKEND

Patty McMillen — Mon, 20 May 2013 23:01:00 +0000

KEEPING YOUR HOME IN GOOD SHAPE

Patty McMillen — Tue, 14 May 2013 22:31:00 +0000

Keeping Your Home in Good Shape
So, you did it! You bought a home. Now, it’s time to take care of your investment.
The good thing about home ownership is that the money you put into your home builds
equity (value). The bummer is that you need to spend the money, and savings for a new
water heater is really boring compared to, well, almost anything else.
One of the best ways to make sure you don’t get caught with an expense you can’t
afford is to create a savings account where you put money aside for home repairs and
expenses. How much should you put away? Let’s estimate.
If you bought a house for $250,000, you’ll need about $3,750 per year (estimate
about 1½ percent of the purchase price). Expenses will include insurance: homeowners,
flood, and earthquake. Homeowners insurance is required, and it will cost about $500 per
year. If your home is in a flood plain, you’ll have to purchase flood insurance, and it costs
approximately $800-1000/year. Earthquake insurance is optional, but if I lived on the side of
a hill or along a known fault line in a masonry house, I’d consider it. It costs about $500 per
year with a 15 percent deductible. If you do the math, the earthquake insurance may not be
worth it, but I’m sure not going to be the guy who tempts fate and tells you to forgo the
insurance! Thanks to Mark Davis Insurance who provided these estimates at a moment’s
notice.
Now that insurance is accounted for, we need to consider long-term expenses to
maintain the structure. At some point, you’ll need to repair or replace the paint (inside and
out), flooring (carpet, linoleum, wood), roof, and appliances (water heater, heating/air
conditioning). You also may have some issues to take care of that came to light through
inspections during the escrow process.
How quickly or how often you’ll need to maintain your home depends on how hard
you are on it. Children typically increase wear and tear on a home. As the father of several, I
can personally attest to this. Pets can also speed up the need for new flooring, for example.
In addition to the long-term maintenance, you’ll want to do annual upkeep, too.
Clean rain gutters, caulk window frames, make sure downspouts move water away from your
foundation, replace air filters on central air systems (every 4 to 8 weeks), and clean chimneys.
Annual upkeep will save you money (and keep your family safe).
Some repairs can wait, and others can’t (or shouldn’t). A faulty electrical outlet above
a sink should be fixed as soon as possible. A leaky faucet is unlikely to improve, so you
might as well save yourself the irritation of listening to it drip and wasting the water. A
drippy faucet may cause a bigger plumbing problem, and you always want to find those
sooner than later.
Depending on whether you’re handy with tools and the scope of a job, you may
want to consider hiring a contractor to do certain repairs. If you need a list of contractors
with valid licenses and current workers’ compensation and liability insurance, call your real
estate agent. They can provide you with a list. If you’re debating about whether to take on a
project yourself, here’s my suggestion: if it deals with electricity or gas, hire an expert.
Skimping here can cost lives. If you feel comfortable doing the work and have the time to do
it, by all means, take it on. Be aware that some work may require permits from the City or
County.
When money is tight, you may think that choosing the lower quality product that
saves a few bucks is a good idea. Think again. If you have your house painted, for example,
you are mostly paying for the labor. If you choose the highest quality paint, you won’t have
to hire painters again for a long time. If you need to replace your water heater, different
heaters come with different warranties. As a property manager, I can tell you that if they say
it’s a five-year water heater, it is. For the additional cost of the better quality product, it is
usually a savings over the long term. Prevention doesn’t cost; it saves.
Next time, I’ll talk a about preparing your home for sale. If you have questions in the
future, please don’t hesitate to call me, Patty McMillen 707-467-3637.

Today’s Rates

Pat Williams — Tue, 14 May 2013 16:57:00 +0000

It is still a great time to buy with rates as follows:
30 year fixed 3.625%
15 year fixed 2.875%
FHA 30 year 3.25%
USDA 30 year 3.25%
Feel free to contact us if you have any questions or to get prequalified for a home loan.

The Credit Score Damage

Patty McMillen — Mon, 13 May 2013 20:55:00 +0000

There is no difference in a foreclosure/shortsale or deed-in-lieu, they all affect your credit score, they are considered “not paid as agreed accounts”
The difference in credit score impact observed by real estate professionals and their clients is mainly determined by the history and frequency of delinquencies leading up to the foreclosure, shortsale or deed-in-lieu.
One 30-day delinquency can subtract 60-110 points, and the longer a seller is delinquent the worse damage to their credit score.
A foreclosure can drop a credit score by 150 points or more and will remain on a seller’s record for seven years. The worst is a bankruptcy, which can drop a credit score by as much as 240 points and remain on file for 7 to 10 years.