Creating Your Family Command Center
If your calendar coordination is crumbling and you can’t remember which child has ballet practice and which one has baseball, it’s time to take command. And what better way to do that than by constructing a family command center? It’s a simple project that will help you plan upcoming events, make sure everyone makes their appointments and keep everyone on track in your busy household.
First, find a place in the home with some open wall space that gets trafficked by everyone in the family so that they can easily check in.
Next, hang a good-sized monthly calendar so that everyone can read and update it. Next to it hang a cup or other small container with a different colored pen for each family member for color-coded calendar entries. Add one additional color for family events.
Also hang a mail bin/hanging inbox, similar to what you’d see in an office, with a slot for each family member. These will serve as an ideal spot for school permission slips, mail and other important papers.
For posting papers that everyone should see, such as a flyer for an event or that A-plus test paper, a cork board and push pins or a metal sheet with magnets is an ideal solution.
To make sure family members can easily share quick messages, make sure to include a chalkboard with a chalk ledge or a white board with dry erase markers in your command center.
Other items you might want to hang alongside these core items include several key hooks, your dog’s leash and a prominently displayed clock. A nearby recycling bin for junk mail and other papers that need tossing would be handy.
To add a designer touch, try coordinating the color and look of each of the above items. Also, consider making a frame for items that are plain, such as your monthly calendar, to tie them in with your command center’s overall appearance.
Don’t forget to set some ground rules for your family command center. The goal is to increase coordination and reduce paper clutter, so ensure that everyone cleans out his or her inbox at least once a week, that old messages are wiped off the white board and that old flyers and similar papers are removed from the cork/magnetic board.
A Lender’s Perspective: How does the Homeowners Insurance Agent fit in during a Home Purchase?
In the case of a home purchase, the mortgage lender cannot do his job unless homeowners insurance is provided. And a good insurance agent is very important to make sure the client has the correct and adequate insurance coverage. How is the right coverage amount determined and how does the mortgage lender and insurance agent work together to insure this gets done?
As part of the process of buying a home the subject property needs to be appraised by a certified appraiser who works in conjunction with the mortgage lender. The appraiser determines the market value of the property and provides a formal document with all of the detail of the property, like the square footage and many other things.
What I do as a lender is provide a copy of the appraisal to the insurance agent to assist him or her with their process of ensuring there is adequate and full insurance to cover the client and the lender in case of a loss. Once the cost of the insurance is determined, the insurance agent provides that information to the mortgage lender and we factor that information in the cost of purchasing the home.
As you can see the lender and insurance agent need to work together to make sure that this information moves freely between each and in a timely fashion.
Fantastic! At long last San Mateo County communities will have single stream recycling available!
Great news! Recology will be the new service provider for garbage, recycling and compost pick up for San Mateo County residents. Under the current service, pick up of recyclables happens bi-monthly which means multiple bins fill up & sit at the side of our house. Residents also have to sort paper from metals/plastics and pick up of compostable food waste is not a provided service.
As a former San Francisco resident up until 2004, I’ve been sorely missing this type of compost/recycling program which SF has had in place for several years.
Full details here on Recology’s program including use of their bins. If you want to reduce your garbage bin size & save a little money each month, go to: http://www.recologysanmateocounty.com/single_family.htm by July 9th.
The new service will start January 3rd, 2011.
Proper Care and Feeding of a Living Trust
*This information is designed to be of general interest. The specific techniques and information discussed may not apply to you. Before acting on any matter contained herein, you should consult with your personal legal advisor who is familiar with your personal situation. We are lawyers based in California. If your matter involve non-California issues, please contact a local lawyer.*
URGENT REMINDER: Many Lenders ask you to take property out of Trust ownership when you get a mortgage, but they don’t put it back in afterwards. A Trust avoids Probate Court for assets properly titled in the name of the Trust. If property is out of Trust at death, it is subject to Probate Court. This is a BIG mistake that can be fixed easily now, while you are alive; if not fixed, it will explode later.
So check your property tax bill NOW. Even if you are SURE it’s OK.
As always, the key to proper maintenance of the Trust is to make sure assets are properly titled in the Trust:
a) It is important to review your estate plan periodically to make sure that you still trust those people you have appointed to act after your death, as well as to ensure that the dispositive provisions still meet your present desires.
Are minors on track, or have they detoured?
Our trusted people: are they still competent or senile? Do we need to reconsider who should be in charge?
b) Make sure your Health Care Agent has copies of your medical form. If they get a call in the middle of the night, they may need to grab the form and run to the hospital. Can they find the form (or did they lose it and need a new copy)?
c) When you are dead or incapacitated, the people on whom you dumped this huge chore need some guidance from you to make it as easy as possible for them.
But, if you are dead, can they find your assets? (Bank and stock accounts, safe deposit box, real estate, retirement plans, and insurance? If you have no insurance, think how much time they might waste looking for it, just to make sure they did not overlook something.) Put a current asset list with your Trust papers.
Can they access your computer and the requirements of modern life: email, banking, etc. If you are dead or hospitalized, can they find your passwords?
Can they find your accountant, broker, insurance agent, lawyer, and property managers? Tell them whom to trust and who they should not.
d) Do they know your wishes? Either discuss this with them now, or write them a letter (to be opened after your death) with instructions so they know.
They should know your funeral wishes before they are “guilted” into spending a fortune (unless that’s what you want).
e) Consider writing an “Ethical Will”; a letter (to be delivered after death) of advice about life. Ethical Will: Life Lessons for your Heirs: Tell them who and what you are; who and what you hope they will be. This is not a legal document, but a life lesson letter to your descendants. This is a wonderful way to stay connected with family over future generations. It might contain:
Lessons you have learned (perhaps they can learn from your mistakes);
Personal experiences; or
Family stories and histories which otherwise will be lost forever.
I keep updating letters to my wife and daughters on my computer whenever I am reminded of a lesson in life.
Always, the major chore in the maintenance of a Living Trust is to make sure that all of your assets which have any form of registration are properly titled in your Living Trust. These assets include bank accounts, stock, and real estate. Now is a good time to verify that all such assets are held properly.
You should have received a real property tax bill for each parcel of California real estate you own.
[Please verify from your tax bill that the Homeowner's Exemption is claimed on your personal residence. If not, call your local Tax Assessor for a claim form.]
You also will receive Forms 1099 showing interest or dividends received during the past year, and K-1s for Partnerships.
Please check each real property tax bill, Form 1099, and K-1 to ensure that it reads something along the lines of:
John and Mary Smith, Trustees of the Trust of John and Mary Smith, dated January 1, 1991.
There may be other property which should also be in the Trust but may not provide annual reporting, such as stock which does not pay dividends and, therefore, no 1099 is provided.
Pension Plans, IRAs, and Life Insurance are not usually in Trust: they are owned by you individually, and payable to the Trust at death.
[Creditors (such as your mortgage holder and credit cards) do not need to know about the Trust; only those holding your property should know.]
If you inherited any property or received substantial gifts since formation of the Trust, you should discuss its status and your desires with an attorney.
If you refinanced your property since doing the Trust, you should verify that the property is back in the Trust.
If you bought new property or opened new investment accounts, you should verify that these are properly held in the Trust.
If your marital status (or domestic partnership status) has changed since the formation of the Trust, we should discuss the ramifications.
Although it may not be necessary, it may provide additional certainty to execute annually a statement that all property is in the Trust. This clarifies that any property you may have acquired is in the Trust.
If you have any questions email me at marcw@wwlaw.com
*In accordance with Treasury Regulations Circular 230, we are obligated to inform you that any tax advice contained in this communication was not intended or written to be used, and cannot be used, for the purpose of avoiding tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions.*
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Should I Put the Kids on Title? NO!
*This information is designed to be of general interest. The specific techniques and information discussed may not apply to you. Before acting on any matter contained herein, you should consult with your personal legal advisor who is familiar with your personal situation. We are lawyers based in California. If your matter involve non-California issues, please contact a local lawyer.*
That’s the worst idea ever!
I hear it all the time. “We have 2 grown kids. We are getting older. we want to put the kids on title to our home.” Why does this happen so often? What is the problem? Here is an example:
Dad died. Mom is alone and feeling mortal. She has 1 child: a grown Son. He is a good Son. Attentive. Caring. Helpful. If Mom puts him on title as a Joint Tenant, when Mom dies Son automatically inherits without Probate.
Why is this a terrible idea? What can go wrong?
Son, now an owner, can:
- voluntarily evict Mom;
- force sale of the property; or
- take other adverse actions.
When I explain these risks to a client, the answer invariably is: MY son would NEVER turn against me. He is wonderful and would never voluntarily hurt me.” But what about involuntary actions? Such as:
- What if Son is DIVORCED and his ex-wife ends up owning a part of Mom’s house. The ex HATES Mom. (For years she heard how much better a cook Mom is.) The ex-wife does some of those voluntary nasty things.
- What if Son is SUED (for a business / personal problem) and then Son’s creditor seizes Son’s half of Mom’s house?
- What if Son DIES and leaves his half to his Wife?
- What if Son has an IRS lien?
All of these issues are potential danger points for Mom. But, what is the benefit for Mom? Nothing, unless she dies. Mom’s death was the whole point of putting Son on title in the first place: to avoid Probate when Mom dies. The better way to avoid Probate with no risk to Mom is a Living Trust. Obviously, if Mom has 3 kids, and puts all of them on title the risks are tripled.
My Grandfather was a lawyer. When I started practicing with him in 1980 he warned me about this issue. Clients would come to him to put the kids on title. He warned them against it. He felt so strongly that if a client insisted on doing it despite his counsel, my Grandfather refused to assist. He sent them away. “If you don’t like my advice and want to do it anyway, get someone else to help you. I won’t be a party to this mistake.”
Personally, I advise clients the same, but if a client insists, I will not send them away. I am not surprised when clients do not listen. I figure after I cover my rear by putting these warnings on paper and having them sign a consent, they are entitled to make their own decisions.
After my Grandfather’s death, my Grandmother asked me if she should do the same thing! I told her exactly what her own deceased husband told his clients all of his life: Don’t do it! She did. And nothing terrible happened. But with no-risk alternatives (Living Trust), why do smart, intelligent, people who know better continue to do this? Because it cannot happen to them!
I’ve seen this personally with two different clients. In one case the child had to file for bankruptcy which affected their 50% ownership of the Mother’s home because Mother insisted on putting the daughter on deed rather than doing a Living Trust. The other client had a business go under and is being sued for $200,000,000. What does this mean for the 50% of his Mother’s house? Nothing good.
Also, something to consider is the gift tax issue. A very interesting issue about putting the kids on title is whether a gift has been made with gift tax consequences. If Dad deeds his home to Dad + 3 sons as Joint Tenants, and the house had equity of $100,000, did Dad make a gift of $75,000? Or was no gift made because it is merely a paper transfer: it is still Dad’s house and the kids don’t really own it. These issues must be examined.
If you have any questions email me at marcw@wwlaw.com
*In accordance with Treasury Regulations Circular 230, we are obligated to inform you that any tax advice contained in this communication was not intended or written to be used, and cannot be used, for the purpose of avoiding tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions.*
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What does Home Owners Insurance covers that most people don’t know…
Homeowners Insurance is one of those things that everyone needs, most have, but few really fully understand. Besides your basic coverage which happens when something happens to the home, homeowners insurance covers a few other things that you may not know.
First, your homeowners insurance covers belongings in your car from theft. If someone breaks your window while you are parked anywhere, not just at your home, and steals valuables, your homeowners insurance covers that loss up to a certain amount. Now, how many people think to make a claim to their homeowners insurance when this happens?
Second, let’s say your kid is playing baseball at school, and while swinging, the bat flies out of his hands and hits another player in the head. Your homeowners insurance actually protects you from being sued for monetary damages to the injured player because of your liability coverage. Remember, this doesn’t have to happen in your back yard, or be on the property at all. You’re still covered.
Third, If you store your personal property off site and its lost due to a covered peril, you have protection!
Fourth, If you live on a golf course and are driving a golf cart and run over another player you have Liability protection!
Fifth, if it is not specifically excluded or restricted on the policy back, you generally have coverage any where in the world for these things!
Yes, these things are all great and amazing but I would be remiss to not discuss the things that homeowners insurance does not cover that some people may think or assume it does.
First, it does not cover earth movement. That means earthquakes, sink holes, or other acts of God that may harm your property. There are separate policies that can be taken out to cover these and, especially in the state of California, should be seriously considered.
Second, your homeowners insurance does not cover flooding. It doesn’t matter if the flooding is from a pipe bursting or three weeks of rain, if you do not have separate flood insurance on your home you, your belongings and your home will not be covered.
Third, always be aware the limitations on theft of cash, jewelry, fine arts, and guns. The $20,000 painting in the living room should have it’s own insurance policy, as well as the firearm in the closet and the crown jewels in your safe. Should any of these go missing, your homeowners policy would only cover up to the amount listed in the policy rather than the full amount of the valuables.
If you have any questions on this please feel free to contact me at ctrowbridge@farmersagent..com or 1-650-Farmers.
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Why have home sales gone down in December, January, and February while the median price has gone up?
First, is what is selling. The foreclosure market in the Bay Area makes up about 37% of sales. While this is a lot, it is down from the peak in February 2009 where foreclosures made up 52% of sales. This decline translates into a lower number of sales. In fact, in many hot foreclosure/short sale markets, inventory is down to one to two months.
Second, many buyers front-loaded their purchases in September, October, and November 2009 because they thought the first-time buyers credit would expire by November 30, 2009. This left fewer buyers in December, January, and February to buy homes.
Third, the middle tier of the market is becoming active with many areas seeing multiple offers. The result is that inventory is being bought up faster than new inventory is coming to replace it.
Fourth, many of these multiple offer situations are all cash deals (27% of all sales in February 2010). This means that the median price across the Bay Area is up over 20% from a year ago. Just remember that is not real appreciation – its simply the higher end markets selling again versus mostly the lower end last year. Yet, we can say that prices are really up in the Bay Area – not 20%, but 3-4% in real terms. Real estate is definitely looking better.
This is an excerpt from Carole’s monthly newsletter which contains great information on the Real Estate market of the Bay area and other helpful tips. Check out her site to sign up to receive her newsletter!
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Simple Real Estate Definitions : Short Sale
A “Short Sale” is when a home seller sells his home for a lesser amount than what is owed on his mortgage, and the mortgage lender agrees to accept the lesser amount in lieu of a full payoff.
By way of example, a Short Sale may be appropriate for a home seller whose mortgage balance is $250,000 but whose home wouldn’t sell for more than $220,000. Rather than pay the $30,000 difference to the lender at the time of sale, the seller enters into an agreement with the lender by which all sale proceeds are paid to the bank and the deficient balance is forgiven.
Short Sales are a preferable alternative to foreclosure but the process still harms both parties. For one, the seller is penalized with a derogatory tradeline on credit for not fulfilling a mortgage obligation. And, two, the lender is forced to take a loss on a mortgage loan. Versus an executed foreclosure, however, Short Sale damages are relatively limited on both sides.
For this reason, Short Sales are sometimes considered “the economical alternative” to default.
The process of getting a Short Sale approved varies from lender-to-lender and can be time-intensive. Home sellers should not go at it alone — speaking with a real estate agent about the proper protocol is usually the best place to start. And sellers should be aware of how a Short Sale on their credit can impact future borrowing.
Current Fannie Mae guidelines prevent short-selling homeowners from obtaining new mortgage financing for a period of 2 years.
What’s Ahead For Mortgage Rates This Week : February 1, 2010
In a news-heavy week, mortgage markets improved last week, adding to a 3-week rally.
But, given last week’s data and domestic story lines, it’s surprising that rates actually fell.
- The Federal Reserve said the economy continues to strengthen
- Consumer Confidence pushed to a 2-year high
- 4th Quarter domestic output exceeded Wall Street’s expectations
Usually, events like these draw money away from the bond markets and into the stock markets and Wall Street preps for better corporate earnings. The movement pressures mortgage rates to rise.
Last week, however, different stories trumped the headlines including a report from Standard & Poor’s that said U.K. banks are no longer counted among the world’s most stable. This research, in particular, triggered a flight-to-quality among investors that pumped the U.S. dollar and sparked new demand for mortgage bonds.
It’s one reason why we ended the week on a rally and it just goes to show how unpredictable mortgage rates can be.
This week figures to be a challenge, too.
First, we start the week with key inflation data. When inflation runs hot, it’s usually bad for mortgage rates. Inflation is expected to be tame, however — a point the Fed made several times in its press release last week. That said, inflation data is closely watched by markets and can make a big impact on rates.
Then, on Wednesday, ADP releases its private sector job report. The ADP data is a precursor to the government’s own Non-Farm Payrolls report which is due to hit Friday. ADP is expected to show a net loss of roughly 85,000 jobs. Depending on where the actual numbers comes in, mortgage rates could wiggle a bit.
If the ADP report shows much fewer than 85,000 jobs lost, expect mortgage rates to rise. The same is true for Friday’s job report. A miss on expectations will cause mortgage to ratchet higher.
Since peaking on the last day of December, mortgage rates took a slow, steady descent through January. They’ve have taken back close to two-thirds of December’s overall losses. This week, rates could fall some more, or they could bounce back up. The most prudent time to lock would be prior to Tuesday’s closing.
After that, the respective jobs reports will take over and rates could go either way with force.
Home Values Rose In November 2009 By Another 0.7 Percent
Reporting on a two-month lag, the government said home values rose 0.7 percent in November.
National home prices are at their highest point since February 2009.
But before we look too much into the FHFA’s Home Price Index, it’s important that we’re cognizant of its shortcomings; the most important of which is its lack of real-time reporting.
According to the National Association of Realtors™, 80% of purchases close within 60 days. As a result, because of its two-month delay, the Home Price Index report actually trails today’s market data by an entire sales cycle.
This is one reason why home values appear to be rising even while new data shows that both Existing Home Sales and New Home Sales fell flat last month. The home valuation report is using data from November; the sales reports are using data from December.
The Home Price Index is a trailing indicator and next month, as the Spring Market gets underway, the government will be reporting data from the holidays.
The same is true for the Case-Shiller Index. It, too, operates on a 2-month lag.
All of that said, however, long-term trends do matter in housing and the Home Price Index has shown consistent improvement over the last 10 months. In many markets, home sales are up, home supplies are down, and values have increased. This trend should continue into the early part of 2010, at least.
If you’re wondering whether now is a good time to buy a home , consider low prices, cheap mortgages and an available tax credit as three good incentives. By May, none of them will likely be available.
Michael Haigh
NMLS# 200819
Phone: 415-269-4461
Fax: 877-754-5250
Email: michael.haigh
@wjbradley.com
Ask Mike
