Why You're to Blame for your Foreclosure

All right - enough with the complaints already! I'm tired of hearing sob stories about foreclosures and loan agents that are not honest. It seems everyone has a story to tell about losing their home. Well, that's all there is to read in the real estate sections of most newspapers. You'd think there are houses out there for the picking. The truth is, there are not. In Sacramento, prices have dipped about 10% - a sizeable amount of money, but most people will recover.

Unless you have just lost your home. And people are quick to blame the lenders, the mortgage brokers, the real estate industry, their neighbors, the bank, the Feds, the government, and so on.

I'm tired of the blame game. The fact is, if your house has foreclosed on you, you have no one but yourself to blame. You bought the home, you signed on the dotted line, and you told yourself interest rates would never rise. By the way, if you have a legitimate reason, most mortgage companies will accept a short sale with a realtor. More on short sales later.

My only advice if you are behind in your mortgage payments and think you might lose your home: KEEP TALKING TO YOUR MORTGAGE COMPANY. Don't avoid the letters, phone calls, and other communication. Let them know you are having trouble making the mortgage payments, ask them about other options. Remember - banks are not in the business of real estate, they're in the business of money. They really do not want to foreclose on your home if they can work it out with you.

A Rushed Weekend & Planting

This weekend was such a blur, I didn't notice until it was late Sunday and I was putting laundry away that I would have to be back at work today.

However, we did plant three crabapple trees in the backyard. If you want a reliable tree that gets beautiful pink blossoms and is fairly disease resistant, try a crabapple.

The Essentials for Success as a Landlord

So, you've decided to do it. The mortgage on your house is about $800 and it could potentially rent for $1000. Lucky you! I wish I were in your position! And you've made the decision to rent out the place. Kudos on the decision. Here are some things to be aware of when you decide to become a first-time landlord. And, by the way, these are tried and true, both by myself and by friends that actually are millionaires because of their real estate investments:

1. Beware of the easy tenants: In other words, run a credit check. Get them to pay for it, but do run a credit check. There will be many tenants that will promise to pay but you should not - in any case - let them rent your $350,000 home because they will give you $50 more in rent a month unless you can see beyond a doubt that they pay most of their bills on time. (Okay, almost on time. You can't expect perfection. Pitfall #2)

2. Don't expect a FICO score of 800: The reason many people are tenants is because they cannot afford to buy. If they can afford to make your rental payments and have a good credit history, thank your lucky stars. You, my friend, are in the enviable position of being a landlord with a long-term tenant. The very words make the likes of us drool.

3. Always, always, always, always get a security deposit: One of my friends suggests this should be a different number by at least $50 from the rent. There will be a few tenants that will want to use this as a last month's rent. You cannot allow that. If you suspect that in the beginning, collect first month's rent plus last month's rent plus security deposit. If they say they don't have money for the SD but do have money for rent, tell them you will take the SD and hold the property for them until they can come up with the rent or let them have the property with a late charge.

4. Always have a penalty for late payments and checks returned for insufficient funds: Now, don't get me wrong. All tenants are not bad. Heck, more than 50% always pay on time. But their financial situation will be inextricably tied to yours as long as they live in your house. Therefore, it is imperative that you do impose fines on them, the same way your bank will impose a returned check fee on you. The same way your mortgage company will on you if your payment is late. You're a landlord, not a charitable organization.

5. In the same breath, be nice: Do make human concessions. Do fix things when they break. Do remember to thank your tenants when they do pay on time. Heck, send them a Christmas gift. The one thing that makes being a landlord rewarding (and frustrating) is that you are in a personal relationship and a financial one at the same time. And as always, if you lived in the home before, remember to change your insurance to landlord's insurance.

Good luck in building your real estate empire. It's a goal worth working hard for.

Why You Must Read Financial News

Because no one cares about your money as much as you do.

I'm tired of people talking about millionaires like it's an unattainable goal. If you have a plan and find a way to stick to it, you can have a million. Chances are, all your problems won't be solved.

But I read somewhere that in the path toward becoming rich, it's not what you have that matters as much as who you become. I'm learning that's true.

"Will Sell Husband for Wine"

... so a T-shirt I have says anyway. My husband has one that says, "will sell wife for beer" so I always make sure I look good when he wears it. :) Once a guy at Hoppy Brewing Company (good local beer) took a picture of his shirt with his cell phone while we were there having dinner. No, I'm not kidding.

Back to the point - there has recently been a huge push toward bringing wine out of the snob circles and make it more of a beverage every adult should just enjoy drinking. The "drink what you like" credo has become more common. And with that have come many names to wines like "Seven Deadly Zins," "Toasted Head," "Smoking Loon," "Sixth Sense Syrah," and so on. Now I must admit, I did turn my nose up at these... until I tried them.

Lesson learned. Wines do not have to have two first names to be good. I say this as I finish another Toasted Head Cabernet. (Hiccup!:))

Here are the good wines I will consistently reach for: (And they are all affordable)

REDS:
Franciscan Cabernet Sauvignon (the most expensive cab on this list, but very worth it at about $25 a bottle)
Toasted Head Cabernet Sauvignon
Kendall Jackson Cabernet
Blackstone Cabernet and Syrah
Meridian Merlot and Cabernet (Most beginners will like the Merlot - makes a great gift if you don't know what wine someone likes.)

WHITES: (Admittedly, I'm not a huge white wine fan, but I do like them in the summer)
Mondavi Chardonnay
Napa Valley Chardonnay

On the same subject of wine, if you haven't been to Lodi to taste wine, you're missing out. More about my experience later.

The Art of Giving Directions

I am writing this solely on the request of my husband, James. Being a service technician, he is constantly having to call customers and get directions to their place of work. And he gets what he calls "Turn Right at the Rose Bush Directions." Let me explain.

Many of us are fond of putting character into the directions we give each other. For example, "Oh, just get off Highway 99 and then you'll come across this gas station where I filled up my first car. And then - oh, about 2 blocks down, you'll see a bank. Drive a little farther and you'll see a day care center. Make a right there... uh, what street, you say? I think it's Lantana Avenue, no wait. That was at the other day care center. Freesia, I think. Yes, okay, make a right at Freesia and go for about 2 minutes and you'll see the prettiest house on the block. It's blue with white trim. That's not mine. Mine is about three doors down. With a fully blooming rosemary."

Sound familiar?

There is a method to this madness, of course. It works for whoever gives the directions because that's what the person notices when she drives home from the freeway. By the way, women are notoriously bad for this. Admit it, women!

So, here's how to give good directions:
1. Use cardinal points. Left and right turns are easily mistaken. Especially when freeway driving is involved, cardinal directions are a sure way to get someone straight home.
2. Use names of streets at turns. Go south on 99 and exit Lantana Avenue West, then turn right at Freesia is a lot easier to follow. Besides, the person driving is probably paying more attention to streets that daycare centers!
3. This one is a personal pet peeve. USE NUMBERS! Your house has a number on it for reasons other than the mailman. You can show the guest your rosemary later.
4. Finally, if all else fails and you have a computer handy and the person asking for directions doesn't have a navigation system, be kind and just use a map search!

The driver will be a lot nicer when he gets to your house or place of business. I promise.

In Favor of Home

I used to call myself a homely person before I learnt what that really meant. (American slang is so odd sometimes!) But seriously, what beats being home and cooking dinner for yourself with fresh herbs grown from the garden and drinking homebrewed beer?

My husband makes beer at home and we always have a keg or two handy. (Jealous?) Come over to our home any day of the week after six and be treated to one. By the way, did you know that you're only legally allowed to make about five gallons of beer a year? I believe it's ten gallons for two people. What an antiquated law.

Recently I've gotten into dividing everything I have. Just divided two calla lillies into a dozen pots. Much to my horror, they're all going to live! My Easter gifts are ready, I guess. :) My husband thinks I've gone nuts. Anything that can be divided will be. I've also got some philodendrons growing in a sunny window that have set down roots.

By the way, don't think all of this doesn't have a fairly strong economic side to it - what DOESN'T with me? The more "character" you can put into your home, the faster it sells. Now, don't laugh. You know I didn't mean the wrong character. Do something interesting. Have a wine cellar, create a beautiful garden that sustains itself. You're adding value - creating art.

And art always pays off doubly. Once for you and once for the person who appreciates it.

4 Effective Tehniques to get a Neighbor to Turn the Music Down

I have always been one to hate loud noise. And while I understand that with everyone's idea of music being different from everyone else's, nowhere should it be okay to leave all your doors and windows open and blast your music.

Yes, I'm frustrated with the community I live in. It is only my husband and I that think we should be able to relax in our home. Or the nuisances have broken everyone else and we're fairly new to the neighborhood.

But there is something everyone can do without resorting to violence. Especially if you are the kind of person that is NOT bothered too much by the noise. I tend to get stressed out and jittery and that very behavior makes it hard for me to be calm and collected enough to resolve the issue.

But here are some steps you can take to protect your neighborhood from becoming something people will hate to live in:
1. Before anything else, knock on the door of the person who is playing the music and talk to them. Ask them to turn it down. Sometimes, surprisingly, this is all it takes. Just once.
2. If asking them more than three times in different situations, does not work, it is time to start a log. You now have a case. Log everytime they play the music loudly, time and date. I'll tell you why this will help.
3. Call the non-emergency police line and let them know. They are pretty receptive. And will come out to fix it. Remember to log the police visit and any others as they occur.
4. The police knocking on someone's door should shock your neighbors into submission, but if not, the next step is to take your neighbors to small claims court. Anything that destroys your enjoyment of your home is reason to sue and I absolutely support the law in this matter. This is the step that requires the logs. Feel free to claim $25 - $100 per day of disturbance, especially if you have a home office like I do.

More on small claims court for home disturbances later.

Are Foreclosures Really Worth It?

That's the question on everyone's lips these days. Sure, there are a whole lot of people that are in trouble, who can't afford to make their monthly payments, creating innumerable short sales and even more foreclosures. But just because someone else is in financial trouble doesn't make it a great time to buy. It has to make financial and emotional sense to you as a buyer to be able to "cut a deal" in this market.

If you are a first-time homebuyer, this is a decent time to be buying. Just remember the thre most important pitfalls to save yourself some stress if you decide to delve into the foreclosure market.

Pitfall #1: Expecting things to go smoothly and in a given timeline. Pre-foreclosure purchases have no timeline. If the bank has to approve a sale (typically because the seller's loan on the home is more than the market value of the property) they have no timeline to work with. Which means you will have to deal with frustration while you wait and no realtor can push the loss mitigation department of any mortgage company.

Pitfall #2: Bad Credit History. After the recent subprime mortgage meltdown, good credit is more important than ever. With mortgage companies facing so many foreclosures, they will not be jumping up and down to give you a loan for 100% of the purchase price unless you can show a history of paying your bills on time. Get your FICO score and make sure it stays in the 700s. Some seller's mortgage companies will also require you to get preapproved with them even though you may use a different mortgage company.

Pitfall #3: Not getting a Property Inspection. Both pre-foreclosure and foreclosure homes may have damage due to lack of care or malicious elements once the home was put on the market. A termite inspection may not reveal all the flaws. A property inspection and possibly roof inspection is your best bet. If you don't have the reserves to make the repairs, don't buy the home. You can only live with a leaking roof for so long.

But don't let me scare you. Our first home was a foreclosure. Many dollars later, it is a dependable rental. Remember, you make money when you buy, not when you sell.

This is a market to make some serious money!

How not to verbally rape someone

You might be surprised, but some people honestly do not know if they're verbal rapists. Could it be you? Here's how to tell:
- Do people get angry at you for no reason?
- Have people lost patience while you were talking and become a part of another conversation?
- Do people's faces go blank when you are talking?
If you answered yes to all three questions, you might be a verbal rapist.

However, if you are a salesperson and subscribe to the school of "Get Them To Say Yes Everytime" or (the horror, the horror!) attended a class to learn techniques such as "assumptive close" and "two question close," you are already that which you read about: you, sir, (or madam) are a verbal rapist. The other variety only hold my hand until my palms begin to sweat.

Please don't get me wrong. I love salespeople. I am one. The right ones are your friends. They have a genuine interest in your needs, they provide a service that you would otherwise not be able to get. It's the ones that use "scripts" whom I have trouble with. Because these VRs (verbal rapists) strike so much terror in the hearts of well intentioned customers that they run in the other direction when I tell them I sell real estate.

The problem of course if that VBs are more vocal than the other kinds like me that are self assured in our knowledge of the industry and focused on customer service. It wasn't too far back that I met my own VR. And he attacked me with every script in the book. Just yesterday I got a DVD shoved at me. The guy asked me if I was open to making more money. Caught me at a weak moment - I was in service mode.

I said yes.

"Look at this," he said. And after that every other word that came from his mouth was, "Donald Trump, Donald Trump, Donald Trump." Apparently, the Donald had endorsed his company and this salesperson was trying to get me to sign up for network marketing, that broad area of marketing that should be seen for what it is - a grand pyramid scheme in a nicer name. (And by the way nothing against Donald Trump. He only verbally assaults people that have either asked for it or deserve it. He is not in my list of VRs.)

Anyway, back to scripts. The salesperson called this morning to see if I had watched the DVD. What does he begin with? "What did you like best?" Excuse me? How would you like it if you went on a date with someone and he turned around and said, "So now that you've known me for about five minutes, where are we going to honeymoon?"

Talk about sleazy.

The main problem with scripts is that they rob you of real human contact. They also serve to pin the customer in a place of powerlessness, so although the VR gets what he wants, it is at the price of genuine conversation. "Are you open to making more money?" only has one response unless one wishes to sound stupid. "What did you like best about it?" pigeonholes me into not being able to express what I really felt without being rude. Take someone's power away and you'll never make a good sale. You might make the sale, but everytime your customer sees you, they'll cringe. And you're not someone who wants to make people cringe, are you? (Ha! VR, caught you at your own game, see?)

In the end, I told Mr. Wannabe Salesperson that I wasn't interested. But, but... Donald Trump, he said again. Billionaire, he said. Don't you respect him?

I'm more a Warren Buffett, I replied. If something doesn't seem right, I won't invest anything in it. And that was that.