Real Estate in Steamboat

(This is part 3 of a three-part series. Read Part 1 and Part 2.)

This is the last of three articles on how borrowers who anticipate that they soon will be unable to make their mortgage payments can make the best of a bad situation. This article applies to borrowers who do not have significant equity in their homes.

Borrowers with no equity can’t open a credit line and draw on it to stay current on their mortgage, nor can they consolidate non-mortgage debts in a new mortgage. The options they have all require the concurrence of the lender.

But that does not mean that they have no leverage. The lack of equity makes foreclosure an unattractive option to the lender. With no equity, the lender who forecloses is not reimbursed for lost interest, foreclosure expenses or real estate sale commissions. Hence, the lender will be receptive to alternatives to foreclosure that will cost less.

The most attractive of these to the lender is a forbearance agreement, where payments are suspended for a period, to be made up by larger payments scheduled for the future. If forbearance works, it costs the lender nothing. On the other hand, if it doesn’t work, delaying the foreclosure will raise the cost. For this reason, a lender will only consider forbearance if convinced that the borrower’s problem is temporary.

A temporary reversal is one where, if you are provided payment relief for up to six months, you will be able to resume regular payments at the end of the period, and repay all the payments you missed within the following 12 months. If you believe that that is the case, prepare to document it.

If your problem is not temporary, the lender may still be receptive to alternatives that are less costly than foreclosure. The most attractive of these to a borrower, because it allows the borrower to remain in the house, is a loan modification that reduces the payment. This could be a lower interest rate, longer term, a different loan type, or any combination of these. Unpaid interest may be added to the loan balance.

Loan modification might be acceptable to a lender if the borrower’s income has been reduced to the point where the current payment is not affordable but a smaller payment is. A lender is likely to be most receptive to a loan modification if convinced that the borrower’s inability to pay is completely involuntary, and that modification would be less costly than foreclosure.

Borrowers with no prospects of a turnaround in their fortunes, who are unable to pay even with a loan modification, must resign themselves to giving up their houses. Even then, lenders will consider alternatives to foreclosure when they are convinced that borrowers are operating in good faith. If the borrower can find a qualified purchaser who will take title in exchange for assuming the mortgage, the lender is likely to allow it. This is called a “workout assumption.”

Alternatively, the lendermay be willing to accept either a “short sale” or a “deed in lieu of foreclosure.” In the first, the borrower sells the house and pays the sales proceeds to the lender. In the second, the lender takes title to the house. In both cases the debt obligation usually is fully discharged. Both a short sale and a deed-in-lieu appear on the borrower’s credit report, but they are not as bad a mark as a foreclosure.

Lenders are averse to making such deals with borrowers who have negative equity–their loan balance is larger than their house value–and who have the capacity to continue making payments but would like to stop. Such a borrower may view making payments on, say, a $350,000 mortgage secured by a house worth only $300,000 as throwing money away. They may try to rid themselves of their negative equity through short sale or deed-in-lieu.

While these options are less costly to the lender than foreclosure, lenders view borrowers as responsible for their debts, regardless of the depletion of their equity. How they respond depends on how convinced they are that the borrower’s problems are truly involuntary, and on the likelihood of success in collecting more if they go after the borrower for the deficiency.

The writer is Professor of Finance Emeritus at the Wharton School of the University of Pennsylvania. Comments and questions can be left at http://www.mtgprofessor.com.

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Copyright 2006 Jack Guttentag

Like a dripping faucet, floor squeaks can be one of those noisy and irritating little nuisances that pop up in our homes from time to time. If you have a squeak that’s driving you to distraction, here are a couple of things you might want to try.

For the most part, floor squeaks originate in the subfloor area and are caused by two pieces of wood rubbing against each other, or by the wood rubbing against a fastener. So, the first order of business is to do a little more research. Walk around on the floor, locate as many of the squeaks as possible, and mark them on the floor with pieces of masking tape.   

If the squeaks are occurring when you step on the floor right near a wall, they are probably due to lumber shrinkage around the nails that hold the wall to the floor. This causes the joint between the wall and the floor to flex somewhat, and the squeak occurs from the wood rubbing on the nails.

This type of squeak is usually the easiest to repair. Directly adjacent to where the squeak is occurring, simply drive a wooden shim between the top of the subfloor and the underside of the wall plate, which can be done without disturbing the floor covering or the trim. Drive the shim in as far as you can without overly forcing it, then snap or cut it off flush with the wall. The shim wedges the small gap between floor and wall plate, stops the flexing, and eliminates the squeak.

If the squeaks are not near walls, they are probably coming from movement between the subfloor and the floor joists below, which could be from inadequate nailing or insufficient or improperly applied adhesive. In older houses, where the floors were framed with solid lumber as opposed to the more stable I-joists in use today, the noise can also be coming from wood that has dried out and twisted or pulled away from the wood adjacent to it, causing movement–and noise–between the two pieces.

For these squeaks, you need one person to go under the house with a strong light and tape measure while the other one stays up top. Using measurements and pressure on the floor from walking, locate as carefully as possible from underneath where the squeaks are coming from. While the upstairs person applies and releases pressure, study the area to see what’s going on. You may see the floor joists deflecting up and down; you may see them rubbing against other wood, or against ducts or pipes; or you may see that some of the supports under the joists are not fully touching one another.

In the event of gaps between pieces of wood, you may be able to solve the problem by taking wooden shims, coating them with woodworker’s glue, and driving them into the gaps with a hammer (the glue keeps them from working loose again). If the wood is moving against a pipe or duct, you can correct that through the use of additional strapping to stop the movement.

If you find a lot of areas where the subfloor seems to be moving up and down on the joists–as opposed to the subfloor and joist moving up and down together–then the answer is probably going to be to drive screws down through the subfloor from above and into the joists.

The best way to do this is to roll back the carpet and pad to access the subfloor underneath. Study the subfloor to see where the existing fasteners are, which indicates where the joists are. Drive screws through the subfloor and into the joists, getting at least 2 inches or penetration into the joist. Do not drive screws directly through the carpet, as this will damage the carpet back and may void the carpet manufacturer’s warranty.

If you don’t relish the thought of rolling back your carpet–or worse yet, you have hardwood or tile flooring in that area–there is a product on the market called Squeak Enders. Squeak Enders use a bracket assembly that attaches to both the joist and to the underside of the subfloor, which locks the two together and stops the floor from moving. Squeak Enders have to be installed from inside the crawl space, and they can get a little expensive if you have to install a lot of them. However, they work very well in most situations, and might prove less costly then dealing with the finished flooring above.

Remodeling and repair questions? E-mail Paul at paul2887@direcway.com.

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Copyright 2006 Inman News

If you are buying or selling an “as-is” residence during this peak home selling season, it is very important to understand the pros and cons of such a home sale. Thousands of houses and condos are sold “as-is” every day.

But an “as-is” sale usually isn’t the best way for a home seller to get top dollar. The reason is an “as-is” sale gives a warning signal to prospective buyers there might be something wrong with the property.

Purchase Bob Bruss reports online.

However, an “as-is” home purchase might be an incredible bargain for the buyer who understands the possible benefits and detriments.

WHAT IS AN “AS-IS” HOME SALE? Most of us are familiar with “as-is” used car sales. It means the seller makes no warranties or representations as to the car’s condition.

Although similar, “as-is” home sales are a bit different, thanks to state laws and court decisions.

The old days of “caveat emptor” (let the buyer beware) are long-gone in most residential sales. Today’s rule seems to have become “Home seller, beware of the buyer’s lawyer.”

When a home is sold “as-is,” that means the seller makes no warranties or representations, and will not pay for any repairs of even obvious defects. However, in most states “as-is” home sellers are now required to disclose to their buyers all known defects in the residence. The buyer can then consider these disclosed defects when making a purchase offer.

For home buyers, an “as-is” sale is a “red flag” warning to be especially careful. At a minimum, buyers of “as-is” houses and condos should make their purchase offers contingent on a satisfactory professional inspection by a reputable inspector.

Personally, I recommend members of the American Society of Home Inspectors (ASHI) because of their tough membership requirements. Local ASHI members can be located at www.ashi.com or 1-800-743-ASHI.

WHY SOME HOME SELLERS SELL “AS-IS.” As experienced real estate agents know, many homes are listed for sale “as-is” for a variety of reasons.

The three major reasons for selling “as-is” are 1) the seller doesn’t have the funds to correct the disclosed defects and prefers to discount the sales price instead, 2) an older fixer-upper house is likely to be renovated to the buyer’s standards, and 3) the seller doesn’t want the inconvenience and hassle of making repairs.

Additional reasons for “as-is” home sales include the seller 1) didn’t live in the house and is not familiar with its possible defects, 2) recently acquired the property by inheritance or purchase and just wants to make a quick profit, or 3) has owned the home many years and doesn’t care about getting top dollar for the property.

THE UNSPOKEN REASON FOR SELLING “AS-IS.” But there is another unspoken reason some home sellers sell “as-is.” They think they can get away with selling a home, which has a hidden defect that the buyer or a professional inspector won’t discover.

For example, a few months ago I received a letter from a nice couple who bought their first home with virtually every dollar they had. Shortly after moving in, the sewer backed up into the basement. Upon investigation, the buyers learned the sewer pipe to the street was badly broken and needed replacement. They spent about $4,750 for a new sewer line and basement cleanup.

After talking with their new neighbors, they learned the Roto-Rooter man was a frequent visitor to the house so the seller obviously knew of the problem. Unfortunately, for the buyers, the seller had moved out of the area and couldn’t be easily sued for damages.

Unless there was evidence in the basement of previous sewer backups, even the world’s greatest listing real estate agent and professional home inspector probably never would have discovered this serious defect.

DON’T REJECT AN “AS-IS” HOME. Personally, I’ve bought many “as-is” residences for investment, which were incredible bargains. However, I always insisted on making my “as-is” purchase offers contingent upon approval of a professional inspector’s report.

To illustrate, the best “as-is” bargain I ever purchased was a house that had been rejected by dozens of other prospective buyers. As I walked into the living room and saw the ugly crack in the fireplace brick, my first reaction was “yuck.”

However, I made a very low purchase offer, contingent on the approval of a professional inspection, thinking my “low-ball” offer would be rejected. To my surprise, my offer was accepted.

Of course, I accompanied my professional inspector and asked him many questions about the fireplace, which he thoroughly inspected, even up in the attic. He reported it was just a superficial but very ugly crack, which could be repaired for about $150 with special fireplace mortar.

HOW TO HANDLE UNDISCLOSED HOME DEFECTS. Buyers of “as-is” homes should always 1) insist their sellers provide a written disclosure statement of all known defects, and 2) make their purchase offer contingent on the buyer’s approval of a professional inspector’s report. The buyer should always accompany the inspector to discuss any undisclosed defects, which are discovered.

If the inspection report reveals significant unexpected defects which, in fairness to the home seller, might have been hidden (such as attic roof leaks), the buyer then has two choices: 1) cancel the purchase and obtain an immediate refund of the good faith deposit, or 2) re-open negotiations to obtain a repair credit for the estimated cost of correcting the unexpected defect.

Many sellers are so anxious to sell their home, especially in a slow “buyer’s market,” they will gladly agree to buyer repair credits for the undisclosed defects, even if the seller was unaware of those problems.

CONCLUSION. For various reasons, many houses and condos are offered for sale “as-is.” That means the seller must disclose all known defects but will not pay for any repairs.

Home buyers should not automatically reject “as-is” homes. However, they should 1) insist the sellers provide a written disclosure statement of known defects, and 2) make their purchase offer contingent upon a satisfactory report by a professional home inspector. More details on “as-is” home sales are available from a local real estate attorney.

(For more information on Bob Bruss publications, visit his Real Estate Center).

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Copyright 2006 Inman News

It’s been almost 30 years since the architectural and decorative style known as “High-Tech” hit the American scene. Arising during the mid-1970s, and legitimized by Joan Kron and Suzanne Slesin’s eponymous book of 1978, High-Tech had every hipster architecture student of my generation designing facades with chain-link fencing and corrugated culverts.

Among High-Tech’s most celebrated paradigms was Paris’s Pompidou Center, completed by the architects Richard Rodgers and Renzo Piano in 1976. The Pompidou was essentially a building turned inside-out, unabashedly wearing its guts on the outside. Color-keyed networks of piping, ducting, escalators, and other service systems were carried in a scaffold-like framework surrounding the building, essentially becoming the decorative elements. The Pompidou predictably caused an uproar among Parisians and worldwide, with many detractors comparing it to an oil refinery.

The idea that structure was innately beautiful had been a longtime modernist tenet, but the Pompidou took this thinking a good bit further, showcasing technical features that had previously been considered ugly.

Controversial as it was, the Pompidou spurred an entire generation of avant-garde architects and designers to feature utilitarian materials such as industrial lighting fixtures, subway gratings, galvanized and perforated metal, commercial rubber flooring, and non-skid steel plate in residential and commercial design. This new functional aesthetic, theoretically unfettered by the tides of domestic fashion, soon acquired the only marginally accurate appellation High-Tech.

Besides having great visual impact, the frankly functional items used in High-Tech design were sometimes–though by no means always–less costly than their more refined domestic equivalents. More portentously, High-Tech also afforded architects and designers a perfect opportunity to use prefabricated structures, commercial curtain wall systems, and similar modular parts in residential work, a breakthrough that had long eluded the housing industry.

“In the future, all buildings will be built like this,” said the German architect Helmut Schulitz of his steel-framed, largely modular High-Tech home in Coldwater Canyon, Calif., built in 1977. Yet the future Schulitz predicted didn’t materialize.

Rather, High-Tech went the way of most other aesthetic movements, devolving into a sort of decorative subset of minimalism that, ironically, often relied on expensive custom fabrication to achieve its Spartan industrial look. Along the way, the style’s real promise–the idea of building houses using off-the-shelf industrial products that were cheap, simple, and immune from the vagaries of architectural fashion–was largely forgotten.

Instead, the legacies of High-Tech include such dubiously practical trends as using commercial kitchen equipment in private homes, which in turn inspired the commercial-wannabe styling so typical of today’s appliances. But the style also gave us such now-ubiquitous domestic furnishings as factory lamps, ergonomic swivel chairs, and wire closet shelving.

Of course, High-Tech architecture is still very much with us, too–though in a slightly less edgy form–as the standard interior style of countless coffee bars and 20-something clothing boutiques. It’s also the de rigueur interior style for those pricey new loft developments that copy genuine industrial live-work spaces. Perhaps it’s appropriate that the faux-factory style has come home to the faux-factory.

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What’s your opinion? Send your Letter to the Editor to opinion@inman.com.

Copyright 2006 Arrol Gellner

Question: I own a single-family dwelling that I am currently renting. Last week, when I was going over to the rental to perform some requested maintenance, the tenant mentioned that water was overflowing from the roof onto the front porch. “[This is] the same problem as last year,” was the tenant’s comment. This is the first time that she had bothered to mention this to me. When I arrived at the property, the gutter was plugged and water had been running over the side of the flat roof onto the front porch. This excessive water had caused dry rot to form on the corner of the roof where the downspout is located, so obviously the problem had existed for some time. Also, the water has damaged the front door. Who is responsible for maintaining the downspouts, the tenant or the landlord?

Property Manager Griswold replies:

Unless there is a specific written agreement, the landlord would generally be responsible for maintaining the building systems such as gutters. This does not mean that the tenant does not have any responsibility to either make sure that the gutters are clean or notify you if they are not, but ultimately the landlord is the one that needs to make sure the gutters and other aspects of the building are periodically inspected. You also do not really have any viable recourse for the tenant’s failure to notify you of the problem last year. This is why it is important to reach a mutual written agreement incorporated into your lease that provides you the right to access the property (interior and exterior) on at least an annual basis for purposes of inspecting and repairing the property. This is a win-win for the landlord and tenant, but very often overlooked, thus resulting in tenants who suffer from a poorly maintained property and landlords who end up paying much more down the road to make repairs upon tenant turnover.

Question: Recently I made a verbal agreement with my landlord to purchase the house I have been renting for over eight years. We agreed on the purchase price and that I would pay the closing costs while he would address some cosmetic issues at the house. He agreed to fix the roof that has leaked for over five years and take care of any work that may be needed to get a clear termite report. As part of the agreement I needed to acquire credit approval, which I immediately did. He needed to complete the lot split or division of the property, as there are currently two houses on one lot. He told me he would have it done in 90 days. I fixed all the windows, which where in terrible shape from neglect, and I also sanded and painted the awnings to help with getting a clear appraisal and unconditional loan approval by the lender. Then a few months ago my landlord approached me about adjusting the proposed boundaries of our properties by taking 4 feet, or approximately 220 square feet, from the back of my property to add to his property. We ultimately compromised and agreed on half of his request, or approximately 110 square feet, and the purchase price would remain the same. I thought everything was settled until he called last evening to tell me he is backing out of our verbal agreement. He said he now thinks that with the lot split, the property is worth twice as much as he originally thought and he essentially wants to cut me out of the deal. Do I have any legal recourse? Can I make him hold to our verbal agreement? Is there anything I can do? Your advice will be greatly appreciated.

Property Manager Griswold replies:

You need to immediately contact an attorney that specializes in real estate transactions. As a real estate professional, I can tell you that a verbal agreement for the transfer of real estate is not valid. Clearly, you and your landlord made a big mistake by failing to reduce your agreement to purchase this property in writing. At this point, I strongly urge you to spend the time and money to obtain competent legal counsel. If you do not have an attorney, then I recommend you contact your local Bar Association Referral hotline as listed in most phone directories. It is highly likely that the owner will prevail in your situation, unless you get an attorney immediately to begin protecting your rights. I wouldn’t scrimp on the cost of a competent attorney that has extensive experience specifically in these types of real estate transactions. Not all attorneys have such experience. Remember that it will be your burden of proof and your landlord will steamroll right over you unless you get a good legal adviser to help you. You also may be able to seek additional damages for the property improvements you made in anticipation of purchasing a portion of the property. So be sure you immediately document and put the owner on notice for the work you did in preparing the property for the appraisal. You should ask your attorney about any legal rights you may have to place a lien on the property for your labor and materials.

This column on issues confronting tenants and landlords is written by property manager Robert Griswold, author of “Property Management for Dummies” and co-author of “Real Estate Investing for Dummies,” and San Diego attorneys Steven R. Kellman, director of the Tenant’s Legal Center, and Ted Smith, principal in a firm representing landlords.’

E-mail your questions to Rental Q&A at rgriswold.inman@retodayradio.com.

Questions should be brief and cannot be answered individually.

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What’s your opinion? Send your Letter to the Editor to opinion@inman.com.

Copyright 2006 Inman News

Q: We had a plumbing issue today and our landlord wants us to pay for the service. I reviewed our lease contract and it says that the lessor (landlord) is responsible for maintaining and repairing the waterlines. Any insight into this?

A: While I can’t see into your pipes, I can offer some insight into plumbing issues. Basically, tenants must use plumbing fixtures properly and as intended.

If the plumber had to be called out for a problem caused by you or a guest, the tab is on you. For example, if an item not suited for flushing down the toilet, such as paper towel, Q-tips or feminine protection products, the bill goes to you.

Ditto for any drain pipe, including garbage disposals. Some residents toss excessive amount of peelings and scraps into the kitchen garbage disposal and forget to run the water, which can cause the machine to shut down on newer models. If the disposal quits as a result of misuse and the disposal has to be cleared and reset, the repair bill may be handed to you.

Another problem often disputed is clogged drainpipes. Common sense should dictate what should go down the drain. Plumbers have described bottle caps, toothpicks and toenail clippings pulled from drains that seemed particularly clogged, requiring a trip to the cleanout area outside the unit. The cleanout, often located in a basement requires heavier equipment and may not be easily accessed. This type of cleanout is particularly pricey, which adds to the bottom line.

My advice? Ask the landlord for any written instructions of the care and use of the property, especially for plumbing. Some forbid the use of any liquid drain cleaner, since it can corrode the pipes, especially in older properties. Others disallow the use of toilet tank inserts, since they corrode the water seals.

Finally, do both of you a favor when you have a problem–plumbing or otherwise–by describing the problem as fully and completely as possible. Calling and complaining about a “plumbing issue” doesn’t define how, when, or where the problem should be investigated.

Q: The plumber said the pipes are very old. Don’t water and gas pipes have to be inspected periodically for safety? Do we have to pay for leaks and repairs?

A: Gas line and water are usually left unchecked unless a problem surfaces. As for repairs, unless they were caused by your deliberate use, you’re not to blame

Why aren’t gas lines inspected? Gas pipes, or lines, are only checked if the smell of gas is present. Fortunately, the odiferous scent added to natural gas makes trouble easy to discover. The gas company will come out at no charge and can be called directly. While there is no set inspection law for gas lines in most areas, some laws have changed since the Northridge earthquake in California, requiring flexible connections to all gas appliances, including water heaters. Water heaters have to be properly strapped into place as well. Some cities have stricter laws than others. If you have any specific concerns, details can be often be found by contacting your local Building and Safety Department.

Water pipes are separate than gas lines, and are rarely inspected or even noticed unless there is evidence of water leakage or mold. While older water lines can be troublesome, they are rarely dangerous. Water seeps downward, so downstairs dwellers should be on the lookout for water dripping from light fixtures or where walls and ceilings join. If you do seewater anywhere near an electrical source, call the landlord immediately and do not touch anything near the source.

Water leaks can also run under floors and feel “soggy” when you walk. A recent water leak at our place in the kitchen went undetected for a week since it was seeping from the shower pan behind a common wall.

If you notice water dripping from a pipe connection, notify your landlord immediately. Pinhole leaks can sometimes cause damage quickly, since the water sprays out like a high-pressure water gun. Hot water leaks are particularly damaging.

Sewer lines can sometimes get clogged, and since the water has nowhere to go, it can back up. A telltale sign of sewer backup problems is sludge appearing in the bathtub and toilet at the same time. Sewer backups are only the tenant’s fault if a foreign object, such as a bottle cap or excess hair or paper has been flushed into the system. Otherwise, the most common sewer culprit is tree roots, which are not the tenant’s fault.

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Copyright 2006 Helene Lesel

DEAR BOB: My mother and father lived in their house for over 40 years. Dad died in 1987 and my elderly mom continues living in the home today. She recently applied for a low-income housing assistance program to replace the roof. When a title check was made, it shows title is still held in the names of both my mother and my late father. The government agency refused to pay for the new roof until my late father’s name is removed from the title. How can this be done? –Robert N.

DEAR ROBERT: You or your mother should consult a local probate attorney. If your father died without a living trust, which could have transferred title without probate, it might be necessary to open a probate court proceeding to transfer his title according to the terms of his will.

Purchase Bob Bruss reports online.

If he didn’t leave a will, then his title transfers according to the state law of intestate succession, presumably to your mother. Depending on the circumstances, the local probate court can resolve this problem.

Your situation shows why it is so important to clear titles shortly after an owner dies. It is usually much easier and less expensive to do so immediately than to wait many years.

REINVESTING IN REPLACEMENT HOME WON’T AVOID TAX

DEAR BOB: My wife and I plan to sell our house where we have lived about 45 years. Our net profit will be around $700,000. We plan to “downsize,” take our $500,000 tax exemption, and buy a less expensive townhouse for around $250,000. Will this qualify for 100 percent tax avoidance? –Henry R.

DEAR HENRY: No. If you sell your principal residence, which you and your wife have owned and occupied at least 24 of the 60 months before its sale, Internal Revenue Code 121 says you qualify for up to $500,000 tax-free sales profits if you file a joint tax return.

However, you will owe long-term capital gains tax on the remaining $200,000 of your sales profit. Purchasing a replacement home, no matter what its purchase price, won’t help you avoid tax on that extra $200,000 profit. For full details, please consult your tax adviser.

NO NEED TO FILE FEDERAL ESTATE TAX RETURN FOR A SMALL ESTATE

DEAR BOB: In 2005 my mother died. Her total assets, including her rural house, were worth less than $200,000. Her will left everything to her sister. The probate court handled the distribution as a “small estate.” As estate executor, I was told I don’t have to file any federal estate tax return. Is this correct? –Jerome J.

DEAR JEROME: Yes. Because your mother’s total estate was well below the federal estate tax exemption of $1.5 million for 2005 ($2 million for deaths in 2006), no federal estate tax return needs be filed for your late mother.

However, as executor of her estate, if she had any taxable income in 2005, a 2005 income tax return must be filed. For full details, please consult your tax adviser.

The new Robert Bruss special report, “How to Sell Your House or Condo for Top Dollar With or Without a Real Estate Agent,” is now available for $5 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant Internet delivery at www.BobBruss.com. Questions for this column are welcome at either address.

(For more information on Bob Bruss publications, visit his Real Estate Center).

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What’s your opinion? Send your Letter to the Editor to opinion@inman.com.

Copyright 2006 Inman News

Often we receive e-mails from readers about the columns we publish. Sometimes we get thanks and kudos and occasionally we get raspberries. Often we get suggestions on better ways to do a job, and a column occasionally generates a follow-up question or two.

In a recent column we responded to a homeowner who wanted to eliminate the ash smell coming from his damper-less firebox when the fireplace was not in use.

According to the homeowner, the smell was strongest when a ridge of high pressure was in the area. We directed him to a chimney-cap damper that attaches to the top of the chimney and seals the chimney from outside air. This prevents a downdraft through the chimney spreading the smell of ashes in the house.

But one reader wrote us with a similar problem and questions how the damper would prevent the smell of smoke while a fire is burning.

He writes: “I was thrilled to read your response to the question regarding the smell of ashes. I was surprised when I discovered that our 1937 home also did not have a damper. I have looked online and found several chimney cap dampers.

“However, I must have missed how you addressed the smell of smoke and ash in the house when the homeowner had a fire. We also have glass doors on our fireplace. We opened the side vents on the glass doors, but still had smoke in the living room. How will the damper prevent the smell of the smoke?

“I must also point out that our downstairs fireplace in the rumpus room has only a screen and no glass doors. That room was awfully smoky when we tried to have fire in the living room fireplace. Any thoughts on that?”

We believe the root of the problem in both of our readers’ fireplaces is a lack of combustion air. A damper retards the flow of air to and from the inside of the house to the outside. If a properly installed damper is open, it has little to do with how a fire burns.

Fire needs air to burn. While it is true that warm air rises, the air must be hot enough to suck in combustion air from a source outside the firebox and create a draft carrying the smoke up the chimney. For the upstairs fireplace, we suggest the glass doors be kept open until the fire gets going. This allows enough combustion air into the firebox for the smoke to go up the chimney.

Opening a window a bit will also help to provide combustion air. If this doesn’t work, the readers may have to investigate providing combustion air from outside the house. This entails consulting with an experienced masonry contractor to determine if a combustion air kit could be safely installed in one or both fireboxes.

For a more detailed discussion visit www.askthebuilder.com. There, you’ll find an article titled “Second Fireplace Smokes When Not in Use.”

Also, recently we answered a question about removing grout from a tub and shower surround. We suggested a circular saw with a Carborundum blade and a diamond-studded grout saw. We also mentioned the possibility of using a Dremel tool to remove the grout but refrained from recommending this tool because we have no experience using one. Our concern was just how easy it would be to control.

Edward Malouf of Marin County, Calif., e-mailed us, highly recommending the Dremel for the job.

He writes: “I read your article about grout removal. I had a grout problem and was advised to buy a $50 Dremel high-speed drill. The Dremel I purchased had an attachment that came with it for grout removal. It held the bit at the correct angle–about 45 degrees. I had no problem controlling it.

“It rotates at 15,000 to 35,000 rpm, cuts very cleanly and didn’t jump around. The user must wear eye protection and cover his nose and mouth. It worked and sounded like a dentist’s drill. It was a piece of cake.

“You would be doing the people with grout problems a huge service to suggest this tool compared to using the tools you suggested.”

And so we are. With the control issue resolved, this may be the way to go.

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Copyright 2006 Bill and Kevin Burnett

In July 2000, the city of Long Beach, Calif., recorded a “Declaration of Substandard Property” against a four-unit apartment building. The building inspector estimated it would cost $20,000 to bring the property into building code compliance and repair deficiencies in the vacant building.

On Dec. 13, 2000, the property was sold to Aztec Financial at a foreclosure sale. In February 2001, Aztec sold the property to Rahim Pashmaki, who obtained a $247,500 mortgage from Daaz Financial Services, which later assigned the loan to D & M Financial Corp.

Purchase Bob Bruss reports online.

Because the necessary repairs were not made to the building, the city sent several intent-to-demolish notices to new owner Pashmaki, but not to the mortgage lender, D & M Financial.

On Friday, Aug. 10, 2001, the city mailed a “48-Hour Notice of Intent to Demolish” to Pashmaki and a copy to D & M Financial Corp. in Belleville, NJ. On Monday, Aug. 13, 2001, an employee of D & M phoned city building inspector Dale Wiersma who had authority to stop the demolition. But Wiersma refused to do so.

The building was demolished. The city sent Pashmaki a demand for the $11,615.20 in demolition costs.

On July 29, 2003, the property was sold at a foreclosure sale to D & M for only $70,500 (presumably the land value). D & M then sued the city for the $330,000 value of the property before demolition, alleging it suffered inverse condemnation damages.

If you were the judge, would you award the mortgage lender damages for demolishing the building, which was the security for the mortgage?

The judge said yes!

The mortgage lender has legal standing to bring this action for inverse condemnation damages caused by the city’s demolition of the building, which was security for D & M’s mortgage, the judge began. The city violated its own ordinances by failure to properly notify both the property title owner and the mortgage lender more than just 48 hours before the building was torn down, he continued.

In the absence of an emergency, the city had a duty to provide both the property owner and the mortgage lender with the opportunity to correct the substandard conditions as an alternative to demolition, the judge emphasized.

The recorded “Declaration of Substandard Property,” which was recorded by the city under prior building ownership, was insufficient to notify the current owner, Pashmaki, and the current lender, D & M Financial Corp., that demolition will occur, or was even contemplated, the judge noted.

The city could easily have notified the out-of-state lender well in advance of the demolition, rather than waiting until just 48 hours before tearing down the building, which could have been repaired for about $20,000, the judge commented.

Because D & M Financial’s secured mortgage interest in the property was terminated without adequate advance notice, the city is liable to D & M for inverse condemnation damages of $260,000 and the city is ordered to remove its $11,615.20 demolition cost lien from the property title, the judge ruled.

Based on the 2006 California Court of Appeals decision in D & M Financial Corp. v. City of Long Beach, 38 Cal.Rptr.3d 562.

(For more information on Bob Bruss publications, visit his Real Estate Center).

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Copyright 2006 Inman News

DEAR BOB: Quite by accident, my wife and I stumbled on a beautiful 3.5-acre hilltop parcel for sale near a small town where we have vacationed many times. The asking price is quite reasonable, but it has been for sale over 12 months. There is a very good reason: It is landlocked with no permanent access to a public road. It has a dirt road over a neighbor’s land. The real estate agent introduced us. The neighbor is a “good old country boy.” He says we can use the dirt road over his acreage “if we don’t cause trouble.” When we explained we would like to build a retirement home if we buy the 3.5 acres, he said, “That might be all right if you don’t cause no trouble.” However, we would want to pave the dirt road because in rainy weather it could become dangerous. Is there any way we can force the neighbor to sell us a permanent easement? –Dean W.

DEAR DEAN: Possibly. You certainly don’t want to risk buying that landlocked land without a permanent recorded road access easement.

Purchase Bob Bruss reports online.

The general rule on landlocked parcels, depending on state law, is the owner of the landlocked property has a right of access to a public road. However, to acquire such access you must be able to prove at one time in the past both the landlocked parcel and an adjoining parcel with road access had common ownership.

The legal theory is that when the property was subdivided, the owner forgot to provide road access to the landlocked parcel.

This is not a do-it-yourself project. You need to consult an experienced real estate attorney, and a title researcher, to determine if you meet the requirements for an easement by necessity. If not, your best alternative is to buy a permanent easement over the neighbor’s land. Cash usually talks.

CAN A QUITCLAIM DEED SIGNED BY MISTAKE BE UNDONE?

DEAR BOB: I refinanced my home to lower my interest rate and the payments. At that time, I thought my grandson should co-sign because he was making part of the payments. By mistake, I signed a quitclaim deed giving him right of survivorship. How can I get my property back? My daughter (my grandson’s mother) will inherit the home in my will. –Alice McC.

DEAR ALICE: For your grandson to co-sign on the mortgage obligation, the lender probably required him to be on the title. That is probably why you were presented with the quitclaim deed conveying an interest in the property to your grandson.

If you had not signed that quitclaim deed, you probably wouldn’t have received the new mortgage.

Although a title mistake can be “undone,” you might not want to do that. You and your grandson should consult a local real estate attorney to discuss the consequences. He might stop paying part of your mortgage payment if he can’t claim the tax deduction because he is no longer a co-owner.

HOW TO ESTABLISH A PAST STEPPED-UP BASIS

DEAR BOB: My wife died in 2003. We lived in our house for 35 years and I continue living in it today. Having read your articles about stepped-up basis, I realize if I decide to sell, this will be very important to have my basis stepped-up as of the date she died. How do I prove the market value on that date? –Morton G.

DEAR MORTON: An easy way is to check with the local tax assessor’s office to see what value they showed for your home as of that date. If that valuation is acceptable to you, ask for a copy and file it away in your important records file.

That’s what I did when I inherited some property in 1991. In the local jurisdiction, each property is reassessed annually and I felt the assessor’s market value estimate was reasonable. That became my adjusted-cost basis for the inherited property.

However, not all local tax jurisdictions reassess each year. Some assessments are far lower than market value. If that is your situation, I suggest you hire an experienced licensed appraiser to determine the 2003 market value of your home. The appraiser can do this by checking comparable 2003 sales prices of homes like yours.

(For more information on Bob Bruss publications, visit his Real Estate Center).

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What’s your opinion? Send your Letter to the Editor to opinion@inman.com.

Copyright 2006 Inman News