August 23, 2013

Home Inspection Issues: Foundation problems and what to do

Filed under: Property Inspection — Chuck @ 10:43 am

If a home inspection report comes back with a recommendation to do further investigation regarding the foundation, this is a potentially significant issue that buyers or homeowners should take seriously. The foundation is the support structure for the whole house. If something is wrong with it, that can adversely impact the entire house. So foundation problems can be one of the most critical, and they necessitate expert diagnosis and appropriate action as soon as possible.

Telltale Signs
Sometimes there will be obvious structural cracks along a concrete foundation that indicate that it could be breaking apart. Other homes are set on piers made of concrete blocks or wood, and those may be out of alignment or structurally degraded. A damaged foundation may cause the roof-line to become uneven, or it might make the footings holding up the house sink.

Interior symptoms include tilted floors. If you place a golf ball on a smooth floor and it suddenly rolls to the other side of the room, for instance, that may indicate that the floors aren’t level because of an unlevel foundation. You may find that doors stick and are hard to open, or that they fall open by themselves. Wide spider-web shaped cracks above window or door frames may indicate foundation problems, as could large cracks running diagonally across the walls.

There are many reasons why a home inspector might be led to believe that the foundation needs to be more closely examined. The inspector will conduct a visual examination, and if there are any red flags that might point to foundation trouble the inspection report will suggest consulting a foundation expert.

What to Do Next
Normally this means that you will need to hire a qualified foundation repair company or a certified structural engineer. They will perform tests to evaluate the condition of the foundation, and based on the results they will either give your building a clean bill of health or they will recommend a suitable remedy.

In many jurisdictions foundation companies are required to be licensed by a regulatory board, so before you hire a company be sure to check your local laws. If foundation contractors have to have a special license or other credentials, make sure that those are up-to-date and in good standing. Similarly, engineers have to have specific credentials, and they should put their signature and engineering stamp on any reports they publish and issue to you.

Various Solutions
You may find out the signs and symptoms are only cosmetic, and that they are caused by something other than a poor foundation. But if the foundation is in need of repair, they may be because it is shifting against the ground. As the foundation moves it will pull the house with it, and this can cause all sorts of structural degradation.
There may be a drainage problem pushing the foundation that can be addressed by redirecting rainwater – or if the original foundation was placed on an unsteady, unstable terrain, this could mean that curing the problem is virtually impossible.

If the foundation is breaking apart or crumbling, it may be necessary to repair and strengthen it and then once it is stable, repair any subsequent damage to the rest of home such as cracked walls or twisted beams of lumber. Oftentimes a foundation repair company will jack the house up off of its foundation, perform the repairs, and then ease the house back down on its new, stable footing.

Depending upon the extent of the problem, the repairs could range from relatively simple to very complicated and expensive. In extreme cases foundation problems can be considered catastrophic. After an earthquake or a flood, for example, some homes have to be rebuilt or condemned because of unsafe foundations. So consult with your inspector, follow his or her recommendations, and hire the best experts you can to examine the potential problem and then offer you repair solutions.

Real Estate Advice: Lock in mortgage rates ASAP

Filed under: Real Estate — Chuck @ 10:41 am

If you have been sitting on the fence about taking out a mortgage to buy a home or to refinance your current home loan, you may want to go ahead and act. That’s because rates are quietly but significantly beginning to creep upward. They may never again be this low, at least not in your lifetime.

Interest Rate History
For most of the 20th century any rates that were less than double digits were considered a pretty good bargain. During the late 1970s mortgage rates climbed higher than 25 percent, which is considered super expensive these days even on credit cards. Many people in the 1990s paid extra points just to buy down to a rate of 5.5 or 6 percent. It was not until the 21st century that home buyers became accustomed to low single-digit rates that dipped down to 3 or 4 percent or even lower.

After the Great Recession hit, the prevailing rates that help determine consumer interest rates were cut to almost zero. That was an emergency precaution to prevent the economy from going into a deep depression. They have remained there for several years, too, which is why home buyers have enjoyed the lowest mortgage rates in history.

Upward Pressure
But as the economy picks up steam and the housing market rebounds, rates will also rise back to levels that are more normalized. Already within the past few weeks rates on popular fixed-rate 30-year mortgages have jumped more than a half a percentage point. In July they rose to about 4.5 percent, for example, and we also say rates make their biggest 1-week upward move in more than 25 years.

These are signs that the economy is getting healthy enough to withstand higher rates. That should alert potential borrowers, however, that now is the time to take advantage of historically low rates while they still exist. Once they begin to move significantly higher – which may already be the trend underway – they may never return to today’s bargain levels.

What You Can Do Now
A move of one percentage point can raise the monthly payments on a 30-year, fixed-rate mortgages by about $60 for every $100,000 that is borrowed. So if you are borrowing $200,000 to buy a home, that kind of move in rates could cost you an extra $1,200 a year for many years to come. Likewise, if you are trying to refinance in order to save money a jump in interest rates could undermine your strategy by wiping out your potential savings.

The bottom line is that if you are thinking of borrowing, you may want to go ahead and commit. You’ll still get an attractive interest rate that is historically affordable, whereas if you procrastinate for a year or more your window of opportunity may slip away – leaving you to pay more every month for the lifetime of your mortgage.

The upside of higher interest rates is that you will be able to earn more interest on your savings. As consumer rates rise, so will the amount paid on instruments like certificates of deposit and money market bank accounts. That’s another compelling reason to go ahead and take out your home loan now, while you can save money. Then put that extra savings aside into an interest-bearing account where those savings can multiply and compound – saving you even more money over the long haul.

Homeowner Tips: Invest in a “Learning” Thermostat

Filed under: Home Owner Tips — Chuck @ 10:38 am

Over the past few weeks the mercury has risen to scorching levels, breaking many records for extremely high temperatures. The widespread heat wave in July was, in fact, one of the worst since the early 1950s across much of North America. That meant that homeowner utility bills – even in northern locations like New England and

Eastern Canada – were also sky high, as people cranked up their air conditioning units to beat the heat.
As temperatures go up in the summertime so do our energy costs, and heating bills will also be more expensive during an especially frigid winter. Just a matter of 2-3 degrees difference in how the temperature in your home is regulated can add up to a significant change in how much you pay for heating and cooling. That’s why it is so important for homeowners to have an accurate, efficient thermostat.

Programmable Thermostats: Not always so smart after all.
In the past that usually meant upgrading from an old fashioned manual thermostat to a “smart” thermostat – one of the modern devices that is computer programmed. But there are problems with those.
For one thing, most of them are complicated to operate. So most homeowners just install them and forget about them, which defeats the whole purpose since they only work correctly if you go to the trouble of programming them. They also need to be routinely updated and recalibrated for optimum energy savings.

Meanwhile if you are not home they still cycle through the programmed settings – wasting heating or cooling energy. In short, they are better than old-fashioned thermostats only if you learn the complex programming system and monitor them to ensure that they are properly matched up to your lifestyle and habits.

A Superior Alternative
The good news is that there is now a better thermostat that will essentially program itself based on your personal preferences. These are referred to as “Learning Thermostats” and some of the best models come from the company NEST.

All you have to do is set it to your own personal preferences. Then over a period of time the unit memorizes your settings, and converts those into a customized program just for you. That ensures that your HVAC system really does follow your own habits and lifestyle – without your need to manage the whole programming process yourself.

The thermostat also provides alerts to remind you when it is time for you to change the filters in your HVAC system – which is a convenient tool for helping you with home maintenance. That kind of homeowner maintenance prolongs the useful life of your HVAC system while it also makes it run more efficiently to save you more money every month.

Wireless Connectivity
Learning thermostats are also wireless, which enables you to control them from anywhere through a computer or other device that lets you communicate via the Internet. If you are on vacation, for example, you can contact your thermostat from your iPad and turn the air conditioning up once you touch down in the airport upon your return to home.

That way while you are driving home from the airport the thermostat will kick in and ensure that by the time you walk through the door your home will be cool and comfortable. You can even download a smart phone app to make this kind of thermostat monitoring and control even more mobile and handy. Most people can install the unit themselves, too, in about a half an hour.

The cost of most of these “learning thermostats” is about $250, and if your HVAC system is not currently operating at optimum programming then you will likely recoup that money quickly through savings generated by no longer wasting your heating and cooling dollars.