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Books to Help You Buy, Sell, Understand Real Estate Ask Our Broker
BY BARBARA BALLINGER
Content That Works

Catalogs may not yet be

crowding your mailbox and holi-
day decorations may still be
stored away. But it’s never too
soon to start your holiday gift
list.A good book that becomes a
handy reference is always a wel-
come treasure.
If you know someone who
plans to buy or sell a house, con-
dominium, townhouse, or co-
operative apartment, why not
consider one of the following
books? If you’re shopping for
real estate, buy one for yourself.
You can never have too much
knowledge or peace of mind.
How to Buy Your First Home
by Diana Brodman Summers (Sphinx
Publishing, 2nd edition, 2005) $14.95
Buying a first house is an
enormous, frightening and exhil-
arating step.Why else was the
phrase “buyer’s remorse” coined?
First-time homebuyers are likely
to experience a twinge – or even
a lot – of worry before they
plunk down a downpayment,
although most end up happy
they took the plunge. Summers’
QandA WITH PETER G. MILLER
tips will help get any neophyte
through the homebuying I’d Like to Pay Off My
process. She carefully presents
the pros and cons of buying,
Mortgage More Quickly. Do I
explains what it takes to qualify Need an Outside Assist?
See MORTGAGES, Page 2
Q: Have you heard about plans
that pay off your 30-year mortgage

iStockphoto
in roughly 10 years? You deposit
your paycheck into a bank account
that pays the mortgage. In addition
to paying the mortgage loan, all
your other bills are paid from this
account. Do you recommend such accounts?

A: This is a question I hear frequently. Let’s take a

look at what’s good, what’s tricky and what you should
avoid about these programs.
With a right to pre-pay a mortgage in whole or in
part and without penalty, any homeowner with the
cash can repay a 30-year mortgage in 10 years. Let’s say
you have a $100,000 loan at 6 percent.The monthly
payments over 30 years are $599.55 for principal and
interest. If you increase your monthly payment to
$1,110.21 you will repay the entire debt in ten years. If
held to term, interest on the 30-year loan amounts to
$115,838.19.Total interest paid in a 10-year timeframe
is just $33,224.60.
Bi-weekly mortgages (paid every other week) work
much the same way. If you have a $1,000 monthly
mortgage payment and instead pay bi-weekly, you will
make 26 payments of $500. In effect, instead of paying
$12,000 a year ($1,000 x 12) you pay $13,000 (26 x
$500).The trick is not the extra payments; it’s the larg-
er number of dollars you shell out each year.You could
do just as well paying $1,083.33 once a month, 12
‘Disaster just won’t happen to me’: emergencies such as floods, hurricanes, mudslides, earthquakes and fires may seem remote to first-time renters or home- times a year.
owners who are caught up in the excitement of their new homes.Yet experts urge those starting out to take time to plan carefully for an unexpected crisis. Check the numbers for yourself with a financial cal-
culator or by using the amortization calculator at
www.ourbroker.com. Here is the core question you
Emergency Planning for First-Time Homeowners, Renters: must explore, though, and it has nothing to do with

Cross T’s, Dot I’s to Prepare for the Unthinkable numbers:Why would you rely on a third party to han-
dle your payments rather than simply paying your
lender directly?
BY CHARLES SCUTT ters just won’t happen to us,” says Neal INSURANCE AND PAPERWORK Most lenders allow you to make prepayments each
Content That Works Weichel, agent, RE/MAX of Valencia, Santa Raday says one of the biggest mistakes month without penalty.There is no reason to give
Clarita Valley, Calif.“But between the first-timers make is not to read their entire money to a third party, establish a separate bank

I
f hurricanes Katrina and Rita taught us any-
thing, it’s that you can never be too pre-
pared for disaster to strike.
Whether it’s gale-force winds, mudslides,
fires, earthquakes or terrorist attacks, in a
post-9/11 world, it pays to be cognizant of
potential threats to our homes, family and
way of life and to safeguard accordingly.This
is especially true for first-time homebuyers
or renters, who may not have given much
thought to planning properly for worst-case
scenarios.
“Many of us have the mentality that disas-
California fires two years ago and the earth-
quakes in 1994, my personal experience has
taught me otherwise.”
“First-time renters or buyers should pre-
pare for these incidents because it can save
them a ton of heartache and aggravation, not
to mention severe long-term economic, per-
sonal and property loss, especially to their
homes and future livelihoods,” says Edo
Raday, real estate advisor for Halstead
Property, New York City.“These crises can set
you back severely.”
insurance policy coverage.“Many people are
not fully covered. Not having adequate flood
insurance is a common mistake,” particularly
in flood-prone regions of the country, she
says.
Review your homeowners, renters and
automobile insurance policies carefully and
upgrade to adequate coverage levels based
on your needs and territorial risks, says
Raday.
It’s important to contact your insurance
See UNTHINKABLE, Page 2
account, pay to set up such a program or pay a fee
with each monthly payment. Such fees and charges
could just as well be spent reducing your debt.
Moreover, what if you give money to a third party
and they do not make the monthly payment? Guess
who will owe the late fees? Guess whose credit will be
tarnished? In the worst case, guess who will be fore-
closed?
If you want to make pre-payments that’s fine, but
See ASK OUR BROKER, Page 2

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 UNTHINKABLE
CONTINUED FROM PAGE 1
agent and ask all the necessary
questions, says Dr. Sherrie Raz, a
Boca Raton, Fla., clinical psychol-
ogist who founded The Institute
of Emergency Mental Health
Services in conjunction with
Florida Atlantic University.
“Find out how things will be
handled should you suffer dam-
age during a storm.What is your
deductible and how is it deter-
mined? And do you have actual
value or replacement value cov-
erage?” says Raz.
Also,“talk with your lawyer to
ensure that all your important
papers are up to date: your will,
living will, durable power of
attorney and more,” Dr. Raz says.
Make copies of all your
important records, including
your insurance policies, will, liv-
ing will, life insurance, mortgage
or lease, birth certificates, social
security cards, visas, passports,
voter’s registration cards and
financial account information,
and store multiple copies – one
in a fireproof box on the premis-
es and another with a close fami-
ly member or friend, says Raday.
What’s more, videotape or
photograph all your possessions
and valuables that you can keep
in a safe place for insurance pur-
poses,Weichel says.
Raday also recommends set-
ting up emergency financial
accounts that you can access in
the event of a severe economic
setback, which can come in
handy while waiting for an insur-
ance reimbursement.
MAKE AN EMERGENCY KIT
“Everyone should create a
‘grab-and-go’ disaster supply kit,
which should provide supplies
for up to two weeks,” says
Robert Gerace, professor of
emergency management and
safety at Rochester Institute of
Technology, Rochester, N.Y.
“These kits should include first-
aid supplies, toilet paper, basic
tools, warm clothing, bedding
and any emergency pharmaceuti-
cals you require.”
Other items that should be
stored in your disaster kit,
according to the Home Safety
Council, a Washington, D.C. non-
profit organization dedicated to
preventing home related
injuries, include dry and canned
goods, a can opener, flashlights
and batteries, soap, toiletries and
other sanitary products and a
cell phone charger,
“In the event of water con-
tamination, consumers should
also have in storage a minimum
of three gallons of water per per-
son for drinking and sanitation
purposes,” says Dr.Anne
VanBeber of Texas Christian
University, Fort Worth,Tex.“Store
the water in a cool, dry place.”
Additionally, Gerace suggests
purchasing a portable
AM/FM/short wave radio with a
crank-up, self-contained power
generator,“space blankets”
(super-thin mylar plastic sheets
that efficiently reflect body
heat), and insect repellent.
Dr. Ramirez estimates that you
should expect to spend upwards
of $200 on supplies for your
emergency kit, which can be
stored in a large trashcan, duffel
bag or easy-to-carry plastic con-
tainer with a lid.
PLAN WITH YOUR FAMILY
Having the right supplies is
important, but the key to feeling
safe and not worrying about a
pending disaster is to be pre-
pared and establish a plan that
you’ve practiced with your loved
ones, says Dr. Maurice Ramirez, a
National Disaster Life Support
(NDLS) instructor in Houston,
Tex. Several national health
organizations including the
American Medical Association
established the NDLS program to
help prepare healthcare profes-
sionals to respond to mass casu-
alty events.
Your emergency plan should
be based on the “72-hour rule,”
says Dr. Ramirez.“History has
shown that it takes 48 to 72
hours for enough resources to
arrive to a community to meet
the needs at hand. If you prepare
to be totally independent for 72
hours, you are planning for suc-
cess.”
Practice escape routes from
every room in your home with
every member of your family,
says Dr. Ramirez.All rooms must
have two separate escape points,
and all family members must
know how to escape all rooms
by both routes and where to
meet after the evacuation.
Additionally, plan how your
family will stay in contact if sepa-
rated by a disaster. Pick two
meeting places: a location that’s
a safe distance from your home
in case of fire, and a place out-
side your neighborhood in case
you can’t return home.
“And reassess your emergency
plan with your partner and any
children two to three times per
year,” says Dr. Ramirez.
© Content That Works
Ask Our Broker
CONTINUED FROM PAGE 1
work only with your lender. Use monthly payment
options to create your own pre-payment plan. Keep
records of the additional money you send in – the
amount, check number, date, etc. – and review monthly
statements to assure that all extra payments have been
properly recorded.The stub approach means that you
can make extra payments as you have the money, and
not make extra payments when you don’t. Required
monthly payments, of course, are always due. For
details, speak with your lender.
Q: We listed a property, listed it again after the
first listing ran out and a week into the second
listing decided we wanted to end the agreement
with the broker. The first broker said fine and
asked if we would ask the broker agent to give
her a referral fee to make up for some of the
money she put out for ads and such. So, I asked
the new agent if she would consider the fee and
she said it wasn’t really customary but that she
would discuss it with my former agent. Do you
think the first broker should be paid?
A: If you discontinued the relationship when the
first listing ended then the original broker would be
owed nothing. By re-listing and then seeking an early
termination you have asked the broker to modify an
agreement.The broker could say no but instead has
said yes and is effectively asking for money because of
the investment in ads and such.
The first broker could simply have asked for compen-
sation from you in exchange for an early termination.
Instead, she is trying to get paid in a way that will not
require you to write a check on the spot.There is some
logic to this, but why involve the second broker and
reduce his or her fee? This is a question the second bro-
ker will surely raise.
Q: Can you back out of an offer to sell once
you have signed and accepted the offer?

A: In general, a signed offer is considered contract.

You cannot typically withdraw from a contract unless
the other party agrees or the agreement is conditional
and a condition has not been met. Please talk to an
attorney for specifics.
© Content That Works

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.

BOOKS a heftier price tag. Glink also cov-

CONTINUED FROM PAGE 1
for a mortgage, helps calculate
how much downpayment a
buyer should expect to make and
advises how to negotiate with
confidence.
100 Questions Every First-Time Home
Buyer Should Ask by Ilyce R. Glink
(Three River Press, 3rd edition, 2005)
$18.00
Real estate writer Glink
arranges her helpful information
in an easy-to-follow format, start-
ing with question #1:Are you
ready to buy, both psychological-
ly and financially? She moves on
to provide worksheets that help
a buyer develop a wish list for
their future home and compare it
to a “reality checklist.” She relays
stories of first-time buyers,
including her own first purchase.
When she and her husband were
house-hunting, they put a wood-
burning fireplace high on their
wish list, at No. 5, but ranked a
parking spot low, at No. 20, since
they didn’t own a car. They
regretted their choice, a vintage
coop with a fireplace and no
parking space, a few years later,
when they got a car.
Glink also helps readers
understand how to weigh
whether they should favor pur-
chasing a new home or an old
one, what type of home to buy –
co-op, condo, single-family,
mobile – and how the structure’s
condition should influence the
decision. Residences purchased
in move-in condition make reset-
tling smoother, but typically bear
ers how to select a good real-
estate practitioner, negotiate the
deal, get a mortgage and plan a
move.
The Essential Dictionary of Real
Estate by Lisa Holton (Barnes &
Noble Books, 2003)
Any business has its own
lingo, and real estate is no differ-
ent.There are 3,000 terms author
Lisa Holton thinks you must be
comfortable using when you set
out to buy, sell or rent a home.
Did you know, for example:ADA
stands for the Americans with
Disabilities Act; a trust account is
an account to safeguard the
funds of buyer or seller; a trophy
building is a landmark that’s well
known and highly regarded
because of its materials, finish
and trim; a zero lot line is a lot
where the home is sited right at
the lot boundary, leaving little
space between it and the house.
Holton’s book also includes use-
ful appendices, including dia-
grams of different types of hous-
es – bungalow, Cape Cod,
Georgian, and the like – and the
most important parts of a house,
such as its soffit and fascia.
Tips & Traps When Buying a Condo,
Co-op or Townhouse by Robert Irwin
(McGraw-Hill, 1999)
Buying one of these forms of
homes isn’t the same as buying a
single-family residence, says
author Robert Irwin, and he sets
out to help readers grasp the
financial, legal and social pros
and cons of each. Example: with
a townhouse you won’t have
neighbors above your unit.
Whichever form you select,
know that you are become a part
of a community, the equivalent,
Irwin says, of “marrying into a
family.” Hopefully, yours won’t be
dysfunctional.
There are important factors to
consider when you live as part of
a group, Irwin points out.You
can’t necessarily make structural
changes within your unit or hall-
way without permission. In many
cases, you’ll need approval of the
building’s architectural review
committee or a board. Hours and
days that workmen may work on
your unit may be restricted.
Before you become too infatu-
ated with a certain unit, study by-
laws to learn about possible rules
regarding pets and how the
building vets and approves new
owners. Many of us have read
stories about swank New York
co-ops that reject politicians,
rock stars and anyone whose
name appears too often in bold-
face type.You’ll also want to
know a building’s history of spe-
cial assessments.
Irwin provides a very useful
list of red-flag questions:What’s
the tenant-to-owner ratio? Are
there any lawsuits pending? How
much insurance does the build-
ing carry? Are its reserves ade-
quate? Have there been big hikes
in assessments? Are you responsi-
ble for any areas outside your
unit? Are there any rules you
can’t live with? The bottom line:
Do your homework as you would
to purchase any type of home.
The bottom line, Irwin argues, is
that a buyer can never be too
prepared.
© Content That Works