Kitchens are some of the most important places in our home. It tends to be where we gather for holidays and what many buyers consider the most important room in a house when searching for a home. Every day we tend to use the kitchen and cooking has become not just a chore anymore, but a hobby. More and more people tend to want to cook at home for health reasons and to save money. So which is better for such an important room in the house? Wood or tile?
Wood Vs. Tile
1. Wood floors fade and warp. Wood floors often will fade from exposure to light. The floor can warp from water which will notoriously splash from the kitchen sink and ice cubes that are kicked under the fridge, if the teens even take the time to do that. Tile, if sealed correctly, repels liquids and will not warp like wood. Every few years, you will also need to clear all of the furniture off the wood floor to have it sanded and resealed.
2. Wood tends to be limited on size and color. Although there may be some choices, wood floor planks are limited on size. With tile you can change things around and play with different colors and shapes. Tile allows for wider planks and more options to put in different colors.
3. Trees are obviously cut for wood floors. Clearly wooden floors need to come from trees and it takes a lot of them to make sure you have the perfect planks for a floor. Tile can now be made to look like wood floors without trees being chopped down to create the same look. (See the photo at #5 below) Tile now has the option of including the knots, lines and colors that look like real wood.
4. Maintenance of wood is a pain. I have two large labs and a bunch of kids so you would think that wood was the way to go. Not so much. My kids would drop a toy on the floor and cause a gouge. I have dropped a large pan on the wooden floor and caused a chip. My dogs' nails would cause scratches. The grape juice that was not cleaned up very well led to stains (kids, remember?). The only way to fix it was to hope sanding and staining/sealing would be the trick. With tile I can fix one or two tiles and not have not worry about the entire floor. It is also more durable so the dogs don't leave their nail scratches.
5. Tile costs less to maintain. The cost to buy and install tile is about the same as wood, depending on what you choose. It is later that the cost savings for even regular maintenance makes the difference. Remember what I said above? Wood floors need to be resurfaced, restained and refinished every few years. With tile it is a matter of resealing.
The market in Denver, Colorado and its surrounding area is HOT right now for sellers!!!
1. Home prices are high. The average price for a single-family detached home in metro Denver is at an all-time high. In April 2016, the average went over $400,000. Home prices have never been this high before, which means your home is worth more than ever. Prices are up over 1o percent from this time last year and show no signs of stopping yet.
2. There are not a lot of homes on the market. Nationally it takes about three months to sell a home while in the Denver metro area it is only taking a little over three weeks! Why so quickly? There is a shortage of homes that are on the market right now. Denver only has about a 6-week supply of homes. Nationally it is closer to 18-weeks. That, obviously, creates a very tight market for buyers resulting in faster sales at higher prices.
3. Interest rates are low. Interest rates during the 1980s are a faded memory. The idea of a home mortgage with a 15% interest rate seems unimaginable for those who were not attempting to purchase "back in the day." Lower interest rates mean an ability for purchasers to buy even more house. FHA loans only require a 3.5% down payment as well, opening up even more possibilities even for those who may not have stellar credit or a lot of money saved up.
Selling before the Divorce is Final
The Best-case Scenario: Selling at a Profit
If you and your spouse are among the fortunate, you may be able to sell your house at a profit before the completion of your divorce and divide the proceeds in an equitable distribution. Yet, even this seemingly simple scenario may pose complicated issues that must be addressed.
For example, if you sell your principal residence (main home) at a profit, you may need to pay taxes on the profit unless you qualify for the capital gain exclusion. Even if you and your spouse jointly own the property, you might elect to file your taxes separately for any number of reasons. Generally, if a co-owner files separately, up to $250,000 of the profit (capital gain) on his interest in the house will be exempt from taxation if that individual satisfies the use and ownership tests for the exclusion. Thus, if each spouse meets the use and ownership tests that apply to co-owners filing separately, each may be allowed to exclude up to $250,000 of his or her share of the profit.
If you and your spouse file jointly, however, you may be eligible for the $500,000 exclusion if you meet the specified criteria, which vary somewhat from those applicable to co-owners filing separately.
Selling at a Loss
In today’s struggling economy, we often hear the terms negative equity, upside-down or underwater mortgage, and short sale. If your house is valued at less than what you owe on your mortgage, you have negative equity, and your mortgage is upside down (or underwater).
If you sell your jointly-owned house at a price lower than your current mortgage balance, you and your spouse will share a debt to your mortgage lender rather than a profit, and the mortgage lender can come after either of you to satisfy that debt.
In some circumstances, your attorney may be able to persuade your mortgage lender to approve what is known as a short sale. Again, the sale price will be lower than the current mortgage balance, but the lender may agree not to come after you for the balance.
Selling After the Divorce
If the value of your house is lower than your current mortgage balance (as described above), you and your spouse may decide to wait until the value goes up before you sell, which may mean waiting to sell until after you divorce. This can be accomplished in a number of ways and each has its own advantages and disadvantages.
Both Ex-spouses Retain Title
Couples who face serious financial limitations, yet still feel compelled to get divorced, may be forced to retain joint ownership of the marital home until a sale is economically feasible. If the couple’s financial restrictions are severe enough, they may both elect to reside in the house and lead otherwise separate lives. This option is rife with potential pitfalls and is not often recommended unless there is no other available choice.
If you can afford the costs of living separately but still cannot afford to sell at a loss, a more workable solution may be for one of you to remain living in the house while both of you retain title. Though this arrangement may be preferable to the alternatives, it may still have some unwelcome consequences, all of which should be considered before choosing this as your course of action.
For example, if a couple owns a home as tenants in the entirety during marriage (as most couples in Pennsylvania do), their ownership will change to tenancy in common as soon as the divorce becomes final, and tax ramifications related to the deduction of interest payments may occur. [An explanation of the differences between tenants in the entirety and tenants in common appears at the end of this blog.]
Another important consideration is your level of compatibility. You and your ex-spouse may get along to a certain extent at the time you divorce, but that may change sometime down the road. Difficulties may arise and other personal relationships may develop. Any agreement between you and your ex-spouse should address such contingencies and how they will be resolved.
Decisions need to be made regarding who will pay the costs of maintenance, taxes, and mortgage while dual ownership is maintained. Time and manner of the future sale of the property must be agreed upon. Refusal of one or the other to abide by the terms of the agreement, and how to deal with such refusal, should also be considered.
Among the many issues couples often fail to anticipate are the following: What if the person occupying the house allows someone else to move in? What if you can’t sell at the agreed-upon time? What if the occupying spouse acts in such a way as to discourage a sale that might otherwise have been made? What if one spouse remarries and wishes to sell before a sale is economically advantageous? The list goes on and on.
One Spouse Takes over Sole Ownership
One spouse may wish to assume sole ownership of the house after the divorce. Such an arrangement is often intended to be temporary—until the children have reached a certain age, for example, or until the spouse who retains ownership feels emotionally strong enough to give up the family home. But, sentimentality and inertia should not be the deciding factors in an asset distribution. The important consideration is whether the spouse who wishes to take over sole ownership can afford the payments, taxes, and upkeep now and in the future without the help of the other.
If you and your attorney determine that one spouse is able to afford sole ownership, that spouse must purchase the other’s interest and obtain financing in his name, alone. This refinancing is crucial.
If one spouse gives up title to the other and the other cannot refinance, the selling spouse is still liable on the original mortgage. If the owner fails to make the mortgage payments, the mortgage company can go after either spouse to satisfy the debt. If the mortgage lender decides to foreclose, the foreclosure will affect the credit rating of anyone still liable on the mortgage, including the party who no longer holds the title. Even if none of these untoward events occurs and the owner makes all the mortgage payments on time, the mortgage still remains a debt for the spouse who has given up title, and this reduces his ability to purchase another property.
Complicated Decisions Call for Objective and Knowledgeable Assistance
The sale of your marital home either before or after your divorce raises many complex issues, only a handful of which have been touched upon here. A divorce attorney can help you anticipate and deal with these issues before they turn into thorny problems you can no longer avoid.
[Both Tenancy in Common and Tenancy by the Entirety involve co-ownership of real estate by more than one person, but there are some important distinctions between the 2 types of ownership. Property owned by individuals as Tenants in Common carries no Right of Survivorship. In other words, if one owner dies, the other does not automatically gain ownership of the deceased person’s share. If a co-owner of property held as Tenants in the Entirety dies, however, the survivor does have Right of Survivorship and will automatically acquire full ownership upon the other’s death.
Another distinction involves the rights of co-owners to sell their interest in the property during their lifetimes. Owners of property as Tenants by the Entirety cannot transfer or sell their ownership interests without the other owner’s permission. Owners of property as Tenants in Common, on the other hand, may transfer their individual interests without the consent of the other.]
Thank you to the law firm of Fellheimer &Eichen LLP for this information
It is spring. The time when most homes go on the market and buyers want to buy and get settled before school starts again in the fall. Before rushing to put your house on the market, take a step back and go through this list.
1. Clean Everything. A clean home gives buyers the signal that you took care of your home. Buyers tend to notice every flaw and cleaning will allow them focus on the good in your home and not the dirt and dust.
2. Unclutter Before Showing Your Home. Sell, give away, toss and get rid of stuff. The less things you have, the roomier your home will appear to a buyer.
3. Brighter is better. Open your shades and use brighter bulbs. A bright home feels more inviting and larger.
4. Odors can kill a sale. Be careful of what you cook. Fish can wait until the home is sold. Also be aware of tobacco, pet, and musty laundry smells. Sprinkle some cinnamon on a cookie sheet and place in the oven around 250 degrees.
5. If it is broken, fix it. Buyers will be more likely to give a lower offer if they walk into a home with instant fixes that need to be done. If it can’t be fixed, replace it or get rid of it.
6. Bye-bye puppy. Many people love their pets, but even pet lovers might not love YOUR pet. Sometimes buyers are allergic to pet dander as well so take the pets with you when there are showings and hide away signs they are there.
7. Paint. Stick with neutral colors. Your daughter loved her pink room but what if the buyers only have sons? Nothing improves the value of a home like fresh, neutral paint.
Buying a home can't be that hard, right? If my offer is made today I can move in tomorrow since it is like renting a place, right? Not quite. In fact, not at all! The process will usually take at least 30 days even if you are paying cash. Why does it take so long? To protect buyers, sellers, and all of the other parties involved in a transaction, there is a lot of paperwork and a fairly long process...and this is a good thing.
Steps in Buying a Home
1. Find a Home You Want to Buy...but Find Out WHAT You Can Afford First. Financing is not just about what you bring home every month. Homes require insurance, interest payments, taxes and upkeep. In addition to actually paying the mortgage, there are several other expenses to consider. Ask a lender to check your credit and get pre-qualified. Even better, get pre-approved so you can show the seller you have a lender who has already willing to loan you the money. Look at, or below, that amount. Looking at homes above what you can actually afford will likely lead to disappointment.
2. Meet with a Real Estate Agent. Now that you know what you can afford, meet with an agent, if you haven't already, and together you can define your wants and needs. Schools, distance to work, the type and lay-out of a home, the yard and upkeep, the number of garage spaces you want, etc. - these things can all be researched by your agent. Agents do this for a living and even sometimes have knowledge and access to information on homes that may not even be on the market yet. Look on-line and do some research on what you are looking for and have your agent make suggestions of homes to look at as well.
3. Submit an Offer. Maybe it was the first home you looked at. Maybe it took looking at twenty homes, but finally you found the one you want! It is time to write up an offer so sit down with your agent and figure out what you are willing to give and what you want in return. Often times an offer can involve more than just how much money you will pay. Will you be renting back to the seller for a while? Do you want the fridge in the garage to be included? What about the chairs in the theater? What deadlines will there be for inspections? There are many more things that go into an offer and it can sometimes seem overwhelming. That is what the agent is for. The offer may be accepted or there may be a counter-offer by the seller. The back and forth can go on for a while but if you come to an agreement, you will submit your earnest money and things move forward.
4. Inspections and Appraisal Once You Are Under Contract. Yes! Your earnest money has been submitted and the home is now under contract.. That is it, right? In a large majority of cases, inspections will want to be conducted by the buyer. These can vary depending on the property. Does the buyer want a radon test? That can take several days. Does the septic system need to have a "Use Permit" issued prior to the sale? That can also take a while especially if there are things that need to be fixed on the system.
A home inspector will look at the home and point out defects, problems, and other issues. A crack in the basement floor? The inspector may recommend an engineer be brought in to look and make sure it is not a structural issue with the home. Do not be shocked by the list of "problems" an inspector might find. They are hired to find all of the problems, even small things that may not matter to the buyer. The back and forth may start again between the buyer and the seller to determine what will be fixed, a contingency for items that may not be fixed, and if the buyer and seller will even continue on with the sell.
The buyer's lender will usually want an appraisal done to be sure the home, which will be their security, is worth enough for the loan.
5. FINALLY! The Closing! Most real estate transactions are done through a title company. A lot has been going on "behind the scenes" while you have been working on the inspection items, getting your loan secure, and packing to move. There have been title searches to make sure the seller is actually the owner of the home. The title company has been checking on any liens on the property where someone else or a company might have a right to payment prior to closing. Documents, lots of them, have been prepared and the title company, your lender, and even your agent have been communicating to make sure the numbers are correct. Once all is in order, you have your closing where you will sign numerous documents. The closer at the title company will walk you through the numerous documents that will require your signature (don't forget your ID as many of them also have to be notarized) but your real estate agent will be there with you as well explaining anything on which you might have questions. CONGRATS! You are the new owner!