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Make the most of your home investment

NARI / Monarch Construction, Norristown, Penn.
NARI / Monarch Construction, Norristown, Penn.

An award-winning basement makeover by Monarch Construction, Norristown, Penn., includes a home theatre and home entertainment center with a custom bar, pool table, recessed lighting and oversize sofas. Recessed lighting and a coffered ceiling helps create a light, airy feel.

Explore the Benefits of Basement, Attic


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W hen house hunting, it’s easy to be attracted to a listing with a new kitchen, large family room and gor-

geous deck versus one that lacks any or all of those amenities. But what about a house without a base- ment or attic? Should the absence of either feature be a deal breaker, particularly in cer- tain areas of the country? There’s no definitive “yes”or “no”answer, say architects and real-estate experts inter- viewed, but do consider the following fac- tors:

Do you have adequate storage elsewhere

in your house? Basements and attics are good places to stash holiday ornaments, family mementoes and out-of-season clothing, so if your planned purchase doesn’t have one be sure the rest of the house offers options. Three- and four-car garages can be a good storage place, says Chicago architect John Eifler. Could you convert your basement or attic into livable square footage? Remodeling these areas can be more cost effective than adding on an addition, says Chicago architect Allan J. Grant.“If you dig down 3 1/2’ to 4’ for crawl space in a new home, it’s not that much more costly to dig deeper for a base- ment, he says. If you initially can’t afford to finish the basement, at least rough in the

plumbing, Grant advises. In the city of Chicago, a basement makes sense because of the scarcity and high cost of land and because many older city houses were built with basements partly or fully above ground.These can become cheerful living spaces, says saleswoman Jennifer D. Ames of Coldwell Banker Residential Brokerage.The lower levels of many older Chicago suburban basements, however, were built partly or totally below ground, so they lack as much light unless remodeled,Ames says. Attics in Chicago city homes usually don’t offer the same potential living space that city

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Case Closed: Attorney Helps in Real Estate Deal


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Imagine owning a large compa- ny and trying to file the business tax return yourself. Or taking apart the engine in a foreign car to diagnose a puzzling problem all by your lonesome.That would be similar to what it’s like to pur- chase or sell a home without the

expertise of a real estate attor- ney. “Since buying or selling a home is such a complex legal transac- tion, it’s in your best interest to have someone with knowledge of the law working on your behalf,”says Rita Polit, real estate agent and consultant with The Polit Group, part of Keller Williams Partners Realty, Ft.

Lauderdale, Fla.“It’s not a good idea to act as your own lawyer or use the same lawyer as the other person in the transaction.” Consider that the lawyer you hire “is independent and has no motives other than your protec- tion,”says Richard M. Zelman, attorney and partner with the firm of Sacher, Zelman, Miami, Fla.“Other participants in the

process, whether real estate bro- kers, mortgage brokers, bankers or otherwise, generally have per- sonal benefit to encourage the completion of the transaction.”


Hiring a real estate lawyer for the sale or purchase of a home

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We’re Buying in Another State. How Do We Make Sure We Get a Square Deal?

in Another State. How Do We Make Sure We Get a Square Deal? Q: We’re Minnesotans

Q: We’re Minnesotans looking to buy a waterfront lot in southern Missouri. This is a property for sale by owner in a subdivision where most lots are developed. The seller is having a closing com- pany write up a purchase agree-

ment. Who should we have review the purchase agreement? Would it be a person in Minnesota or Missouri? Does it matter? Is there any standard language for protecting the buyer? What is the best way to determine fair price for the lot?

A: Just stop.The odds of disaster are overwhelming. First, fair market value depends on local supply and demand.You need the assistance of a local real estate broker or appraiser to get a sense of pricing. Second, there are contract forms that favor buyers and forms that favor sellers.As a buyer you do not want to rely on the seller to provide a form that may require thousands of dollars in excess costs. For example, will you pay the transfer taxes? Or will the seller? Or will the cost be split 50/50? Who pays for a structural inspection? What type of deed will you get? You want professional help in the jurisdiction where the property is located.

Q: What does the number “4506” mean in con- nection with real estate and mortgage financing?

A: Most probably you’re thinking of IRS form 4506, “Request for Copy of Tax Return.”This form allows a third party such as a lender to check past tax returns, something that is appropriate when a loan application is being considered. Be aware that some lenders ask that you sign the form but not date it. Since the IRS will only fulfill 4506 requests within 60 days of the date signed by the tax- payer, an unsigned form may be used at some distant – and perhaps inappropriate – point in the future.Also, be certain that lines 6 and 7 are completed; otherwise any year or form can be requested.

Q: We have a back-up offer on a property. If a seller accepts an offer from another buyer when does our back-up expire?

A: There are a lot of possibilities here, so let’s look at





basements do unless they have peaked roofs,Ames says. Do you live in an area where a basement or attic is a plus because of weather conditions? In states prone to tornadoes, a basement can be a good place to seek safety. In San Francisco, those seeking shelter from an earthquake are more likely to run for protection under a door- way than to a basement, says David Hehman, president of escapehomes.com, a resource for second homes. In cold-climate states, a base- ment often is popular since foun- dation footings need to be dug below the frost line, so they won’t heave and crack, Eifler says.Again, as long as excavation takes place, it’s not much more costly to dig out a basement, Grant says. In warmer climates, home- owners can make do with a slab and no basement, says Michael W. Litchfield, author of Renovation (The Taunton Press, 2005). Houses in areas where the water table is high, like New Orleans, also weren’t built with basements, says Fernando Pages Ruiz, a Lincoln, Neb.-based archi- tect and author. Connecticut architect and author Duo Dickinson cites a dif- ferent basement benefit: extra insulation. But he adds a caveat:



can provide several advantages, according to William H. Brooks, CEO of Hyatt Legal Plans, Cleveland, Ohio.An attorney can review the purchase agreement to ensure that the terms and con- tingencies are in your favor and represent your best interests at the closing in the event of any last-minute disagreements. Furthermore, a lawyer can see that the deed is completed and all documents are filed correctly and in a timely manner. Additionally, if you’re the buyer, a real estate lawyer can ensure the agreement lists all the items you expect to be part of the transactions (for example, appliances and window treat- ments).Your lawyer also can pro- tect your rights as a buyer to obtain a refund for the deposit in the event the sale doesn’t take place and review the title search to uncover any deed restrictions, easements and anything not cov- ered in the title insurance. If you’re the buyer,“on the day your deal closes, your lawyer will exchange documents with the seller’s lawyer, who will hand over the deed, a declaration of possession and relevant affi- davits,”says Polit.“If both lawyers agree that all documents are in order, your lawyer will give the

Bedrock in certain areas of his state, and elsewhere, can be expensive to excavate. Good insulation can be accomplished in less costly ways such as high- performance, fiberglass or rigid insulation in the floor cavity, or for a greater price tag, high per- formance injected foam prod- ucts, says Dickinson. Attic space can also offer the benefit of insulation, especially in warm climates where it absorbs and vents the effects of radiant heat, Dickinson says.You can insulate and cool a house without an attic by using similar principles to insulating the floor above a basement, he says.Also provide maximum ventilation underneath roof sheathing. Do most homes in your area have a basement or attic? Even if you don’t want to copy neigh- bors, consider what’s popular in your area for when you sell.Turn- of-the-century homes in Vicksburg, Miss., were built with basements, but newer homes, especially spec houses, usually are built on a slab, says Pam Beard, with BrokerSouth GMAC in Vicksburg.“It’s less expensive. Even most custom homes aren’t built with a basement but on a conventional foundation and maybe with crawl space,”she says.Attics are more prevalent, though not always full height, she says. If a basement or attic is included in your potential pur- chase, is it well constructed? A

seller’s lawyer a certified check for the balance due on closing, and he will receive the keys to your property.Your lawyer will then register the deed, and the property is legally yours to take possession.” Real estate attorneys are espe- cially important in situations where the title may be in ques- tion, says Brooks,“such as bank- ruptcy, divorce or when the property is part of an estate.An attorney is essential to ensure the property is clear of liens.And in cases of new construction, an attorney is necessary to review the title, make sure all the work is paid for and that all liens are removed.” While buyers and sellers are not required by any state to have legal representation,“some states require attorneys during the clos- ing process to file legal docu- ments, handle funds or be the escrow agents,”says Brooks.“In such cases, the lender’s attorney often handles these matters. However, the lender’s attorney represents the lender’s interests. Therefore, consumers may strongly want to consider having their own attorney to represent their interests.”


Zelman says the only disadvan- tages to using a real estate attor- ney are the costs involved and the possibility the lawyer may be

basement should be water- proofed and possibly include a sump pump, back-up battery generator and interior and exteri- or drain tiles, says Grant. Gutters and a good roof are critical to direct water off and away from the house, Litchfield says. If there’s no basement, Grant likes the idea of a crawl space that can prevent cold from transfer- ring to the home’s floor. Besides good insulation, a well-constructed attic will include a drain pan for heating and air conditioning equipment, Grant says.Ventilation also is key. Attics that lack adequate ventila- tion are excessively hot in the summer,”Litchfield explains.“In winter in cold climates, unventi- lated attics allow rising water vapor from the living area to col- lect as frost on the underside of roof sheathing.The frost eventu- ally melts.”It’s desirable for attics to be accessible via a stair, Grant says. What do your nose and skin suggest? If things don’t smell right in a basement, there may be too much moisture and not enough ventilation, Dickinson says. If it’s exceptionally hot on an average winter day in an attic or as cold as the outside air, there’s probably not enough insulation, he says. If it’s more than 15 degrees hotter in an attic on a hot day, there’s also inade- quate ventilation. © Content That Works

too conservative and not willing to advise you to take what you may believe is an appropriate and acceptable risk, such as stip- ulating or agreeing to a reason- able contingency. A real estate attorney’s fees may vary depending on your location and the value of the property.Your attorney may charge a flat fee or an hourly rate for real estate closings.Typically, you can expect to pay between $500 and $2,000, says Brooks. Buyers should anticipate paying between one half to one percent of the purchase price, Zelman says. “Many home buyers find the cost of a lawyer to be prohibitive when they are husbanding their cash for the downpayment, clos- ing costs and new furnishing,” says Zelman.“However, for a buyer to spend hundreds of thou- sands of dollars without an inde- pendent, unbiased, sophisticated advisor is extremely risky and fre- quently the source of regret after the closing,”he says.


When shopping for a real estate lawyer,“look for an experi- enced attorney with a license to practice law in the state where the transaction is taking place. Experience depends not only on the number of years in practice, but also the extent of the firm’s real estate practice,”Brooks says.

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just a few. In general, a back-up offer is written when a seller has already accepted a purchase offer.The idea is that if the first purchase offer falls through then the buyer will consider the back-up offer. However, you have to see exactly what the back-up agreement says. For example, is the seller required to accept your back-up offer or can someone with a high- er bid get in front of you? Does the seller have to accept your back-up offer at all? Many back-up offers contain a “kick-out”clause. In this situation a buyer with a back-up contract can say to a seller at any point, if we cannot close our offer within 48 hours (or whatever amount of time is appro- priate) then this offer is withdrawn and you must return our deposit. For specifics regarding your back-up offer, be sure to have it read by a local real estate attorney.

Q: What is the difference between a town- house, condominium and patio home? Which is the best buy?

A: A townhouse is one unit within a row of homes.A patio home is a single-story home, often with a base- ment that can be finished to provide additional space.A condominium is not a type of home; rather it is a type of ownership.With a condominium you own your unit, finance it as you prefer, have an ownership interest in common areas and a vote in the affairs of the condo association.A condo can be an apartment-style flat, a townhouse, a detached home or other type of property with both individual units and common areas. As to which is the best buy, there is no universal answer. Different types of property are more or less popular in different communities. No less important, the fact that one form of property may be fashionable does not mean that all units are equally in demand. By its nature, all real estate is unique. Even properties that seem the same, such as a row of townhouses, are actually different in terms of finish, décor, financing, view, drainage, construction and other factors. In fact, if you look at similar units for sale in a townhouse com- munity or a condo you will instantly see that even properties with the same floor plan are not equally attractive.This is why prices differ and some homes sell more quickly than others.

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Do you have a question or a quandary about buying, sell- ing or renting? Peter G.Miller, author of The Common-Sense Mortgage, specializes in providing real solutions to real estate dilemmas. E-mail your questions to peter@contentthatworks.com.

Zelman recommends attor- neys with at least five years expe- rience dealing with real estate transactions.Your attorney also should be familiar with mortgage loan documents and title insur- ance. A qualified real estate attorney can be found by calling your state bar association for a referral or via word of mouth from trust- ed friends, relatives or co-work- ers. Once you’ve narrowed down your search, contact the office, explain your situation and ask if the attorney you’re interested in charges for an initial consulta- tion,”says Brooks.“Use the initial consultation as an opportunity to get to know the attorney and decide if he or she has adequate experience with your type of sit- uation,”he says. Before any work is begun, ask the lawyer about his or her fees and request a signed, written fee agreement.

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