Considering buying an older home? There are plenty of benefits of taking this route versus buying new construction. Older homes have a lot of character, are usually located in more established neighborhoods that are closer to urban centers, and are typically surrounded by mature greenery. That said, older homes may also require some improvements considering the aging of the construction materials.

Yet while many improvements can be easily done with relatively few issues, structural problems can be extremely difficult and costly to rectify. Unless you’re planning to completely tear the home down and build new, you should avoid buying a home with a faulty structure, as it will just wind up being a money pit.

Here are a few signs that a home’s foundation is in rough shape.

Rotting Joists

While you might not necessarily be able to spot rotting joists right away, you might be able to identify them by peering through ceiling panels and poking at the wood with some type of tool. If it’s soft and can easily crumble, you have a big problem. And if the spot you checked has rotting joists, odds are the problem is widespread. This type of issue is very serious and is expensive to fix.

Drooping Roof

If the roof line of the home looks like it’s drooping or bowing in the middle, that may be a sign that there has been some shifting of the load-bearing walls. These walls are incredibly important as they support the weight of the structure and keep it standing straight. A faulty structure could be the culprit behind the shifting of the load-bearing walls.

To get the best view of the roof line, look at it from a distance rather than immediately outside the front yard, which will give you a better perspective. If there is obvious sagging, the home could actually be deemed unsafe.

Cracked Foundation

Hairline cracks in the foundation walls are pretty common and usually nothing to be alarmed about. After a new home is built, it settles after a while which can result in these thin cracks on the inside or outside of the foundation walls. However, thicker cracks can be a sign of something more serious. Anything wider than 1/16 inch is an issue, particularly if lets water or pests in, or gets longer and wider as time goes on.

Large cracks that reach the top of the foundation wall or the basement floor, run horizontally, or wrap around a corner are cause for concern and could signify that the soil under the foundation is moving and forcing the foundation to move along with it.

Improper Water Drainage

If any water from rainfall or irrigation systems is unable to drain properly, it can cause soil shifting, which can put a ton of pressure on a home’s foundation and can even make a home unsafe to live in. Improper water drainage is one of the most common causes of soil shifting which can cause the soil surrounding the foundation to expand very quickly when it rains and rapidly contract during dry spells.

If you notice that the soil around the perimeter of the home is very wet even though it hasn’t rained over the past few days, or the soil is dry despite a recent rainfall or watering, odds are the water is not being drained properly.

Another way to identify improper water drainage around the home is to turn off all faucets and water-running appliances, taking note of the water meter’s readout, then checking to see if the reading has changed a few hours later. If the reading is different, there may be a few leaks under the foundation’s floor or behind its walls which require immediate attention.

Cracked Walls

Not only can cracks appear on the foundation walls, they can also appear on upper-level walls as well. While some cracking is only natural as a home ages, major cracks and signs of crumbling of upper-level walls is a sign of significant settling. If the walls exhibit signs of warping, cracking, crumbling, decay, or water damage, the foundation of the home may be failing and will require extensive work to rectify.

Sagging Floors

A faulty foundation can also manifest itself in the form of sagging floors and ceilings, as well as gaps at the junction of the floors and ceilings. While you can often tell just by looking at the ceilings and floors that they are sagging, you can verify this by using a level tool.

Sticky Doors and Windows

All the windows and doors of a home should obviously fit tightly in their openings to ensure that they are energy efficient, by they shouldn’t be so tight that it takes a lot of effort to open and close them. If you notice that the doors and windows of a home “stick” when trying to open or close them, there cold be an underlying issue with the home’s foundation.

Even if there is some other reason for sticky doors and windows, this issue will need to be fixed immediately in order to reduce energy loss throughout the home.

The Bottom Line

Knowing exactly what to look for when searching for a home can help you identify issues that are deal-breakers. Typically, the foundation, roof, walls, ceilings, windows, and doors are components that will reveal problems with the home’s overall structure. At that point, you have choices: either negotiate a lower price, ask the seller to tackle the repairs for you, or move on.

There are different ways to hold title of a property. While joint tenancy and sole ownership tend to be more common, there are other less common ways to own real estate, including ‘tenants in common’. There really are no limits on how many people can be on title to a home, though realistically, lenders will have specific requirements that can restrict who is allowed to be on title.

So, what exactly is tenants in common, and are there any advantages or drawbacks to this type of setup? 

Tenancy in Common – Defined

Tenancy in common lets at least two or more people hold title to a property. Each ‘tenant’ has the equal right to use the property, regardless of how much stake they have in it. That means that even if one owner only owns a 25% interest in the property, he or she can still occupy and use the entire property just as much as an owner with 50% interest. As such, all parts of the property are considered to be owned equally by all owners.

The owners don’t have to be married, be registered domestic partners, or even live in the home. All owners also reserve the right to leave their share of the property to anyone they choose upon their death, or to mortgage their own portion of the interest without the other owners approving such a move.

How Does Tenancy in Common Differ From Joint Tenancy?

One major difference between tenancy in common and joint tenancy is how the property is transferred to a beneficiary when one owner passes away. With tenancy in common, the title can be passed onto a beneficiary that the owner chooses, while with joint tenancy, the title is passed onto the surviving owner.

Each owner in a tenancy in common agreement does not have any rights of survivorship, which means that unless the deceased owner stipulates in his or her will that the interest in the property should be distributed equally among the surviving owners, the interest belongs to his or her estate. Such is not the case with joint tenancy, in which the interest of the deceased owner is passed onto the surviving owner(s).

Another big difference between tenancy in common and joint tenancy is ownership interest. Whereas each owner in a joint tenancy has equal ownership in a property, owners in a tenancy in common agreement may own different interests in the property, as stated earlier.

That means one owner may have 25% interest in a property while another may have 60%, and yet another may have 15%, for instance. And since a tenancy in common agreement can be created at different times, owners can take interest in a home at various times.

Pros and Cons of Tenants in Common

Depending on a person’s situation and needs, a tenancy in common agreement can come with its own set of advantages and disadvantages.

Ownership percentage. There’s no need to either be married or considered common law to be tenants in common, nor do owners even have to live in the property. That means investors can participate in a tenancy in common for income purposes without the obligation to take up residency. For those who do not wish to take up a large interest in the property, they have the freedom to take whatever amount of interest they choose without having to split up ownership equally.

Right of survival. The big disadvantage of tenancy in common is that there is little control over inheritance. Without any right of survival, each owner needs to stipulate who the heir(s) will be for their interest portion in the property. When one owner dies, that share in the property is transferred to the individual named in the will without the other owners having a say. Any owner can transfer his or her share in the property to another at any time without having to get approval from the other owners.

Interest. The amount of interest that owners have in the property can be advantageous or disadvantageous, depending on the amount of interest they each have. An owner who holds a smaller interest in the tenancy in common agreement still has the right to use the whole property. Obviously, this is beneficial to the owner with a minority stake, while unfavorable for those with a higher stake in the property. That said, investors who don’t actually live in the home might not have a problem with this situation.

Transferring title. All owners in a tenancy in common agreement reserve the right to transfer their portion to another or mortgage it without requiring approval from the other owners, which is great for owners who want out of the agreement but not so good for other owners who might want some stability in the arrangement.

Best Practices For Entering a Tenants in Common Agreement

Before buying a home with others and entering a tenancy in common agreement, consider the following recommendations:

Talk to your lawyer – You’d be well advised to speak with legal counsel with experience in this realm of real estate to help you determine your legal rights and obligations.

Talk to your accountant – It might also be a good idea to speak with your tax advisor to get all the details on how you will be taxed as a part owner of a home, especially when it comes time to get out of the arrangement.

Understand your interest – Each person in a tenancy in common agreement owns a share of the property. You should be very clear about how much interest you hold in the property versus how much interest the other owners hold, as the shares may not be equal while everyone can use and occupy the property equally. Generally speaking, how much you owe in mortgage payments, insurance, taxes, and maintenance directly reflects your exact share in the property.

Split the maintenance work – It’s important to divide the work required to upkeep the property so that everyone understands their exact responsibilities to avoid any disputes. Decide who will be responsible for each task and come up with a regular schedule to ensure maintenance of the property is streamlined.

The Bottom Line

There are clear advantages and disadvantages to a tenants in common agreement in real estate, which is why careful consideration must be given prior to signing on the dotted line. Buying a home in this manner is a great way to develop some equity, but you could be forced to look for another home should one of the other rightful owners chooses to sell. Make sure you seek professional counsel in the form of an attorney and a real estate agent to make sure you’ve covered all your bases in the purchase of a short sale home.

You know when you find a new restaurant you love and you just can’t stop going there? That’s what happened to me with this week’s restaurant find. Goddess and Grocer is an amazing, reasonably priced deli with locations all over the city. I find myself in Andersonville a lot and I’ve been to this location twice this week already. I can’t help myself, it’s so good! Goddess and Grocer is truly a one stop shop. They have a large selection of dry foods, a cold case with to-go items, a salad bar, a deli case, and an extensive menu. I’m a sucker for a great salad, which is half the reason I love this restaurant so much. On my first visit, I tried the Goddess Chopped Veggie Salad. I love when salads are so big, they have to put them in what is essentially a mixing bowl. There was a generous amount of romaine lettuce and spinach, topped with tomatoes, avocado, garbanzo beans, cucumber, radishes, carrots, roasted corn, and their signature Goddess dressing. Loaded with all the colorful veggies, the presentation was beautiful. Not only were the veggies pretty to look at, they were incredibly fresh and crunchy. The Goddess dressing was very tasty as well, the perfect mix of sweet and savory. On my second visit, I had to try the Chicken Salad Sanger. I LOVE chicken salad, so I couldn’t resist. Their roasted chicken is pulled and mixed with celery, grapes, scallions, toasted almonds, and mayonnaise, served on a rustic white bread. I can’t sing the praises of this bread enough. The texture was perfect and the grains suited the creaminess of the chicken salad so well. So many other delicious sandwiches and salads caught my eye on the menu, I know I’ll be back soon.

Goddess and Grocer has 7 locations in the city, all of which you can find information about on their website. The Andersonville location is at 5318 N. Clark St. Their hours are 8 am to 9 pm daily. The seating area inside is small, but comfortable, with wi-fi access and an assortment of table sizes. They also have a delightful outdoor patio!

RACHEL HOOVLER & DEAN’S TEAM CHICAGO

For sellers, a short sale is not an ideal way to sell a home. But for buyers, it may be a great way to snag a great deal on a home. That said, a short sale is not exactly like a conventional sale, and there could realistically be a few hurdles for buyers to have to jump over before this type of real estate transaction comes to a close.

If you’re considering buying a short sale home, get familiar with the process and understand the potential obstacles that you may face throughout the process.

What is a Short Sale?

A short sale involves selling a property for less than what is still owed on it. Any net proceeds of the sale don’t fully cover the outstanding mortgage left on the home. Basically, the seller ends up “short” on paying the home loan back to the lender who agrees to take less than the amount that still remains on the mortgage.

This is hardly the best way to sell a home, but it’s still a lot better than foreclosure. Selling short can also help sellers avoid getting dinged on their credit score.

Why Consider Buying a Short Sale?

Obviously, the biggest – and only – reason why buyers would consider purchasing through a short sale is that they can usually get a great bargain on a home. If you happen to come across a property that you love that just so happens to be a short sale at a price that’s under market value, you can realistically snag a good deal.

And since the lender wants to quickly get their money back that they loaned out, they may even be willing to offer you more favorable financing terms.

If you’re willing to accept a potentially long waiting period before the short sale is approved and the deal goes through, you could land yourself a great place at an awesome price. 

The Short Sale Transaction

If a seller is in a position to sell short, they will have to prepare a financial package to submit to their bank, which will consist of a variety of documents, including a letter of authorization, completed financial statement, two years of tax returns and W-2s, and a comparative market analysis (CMA), among others.

Before you put in an offer on a short sale property, your real estate agent will pull a list of as comparable sales to come up with an appropriate offer price, which is typical in any offer situation. The price you offer is crucial not just to the seller, but also for the bank, which will want to receive as close to market value as possible.

Some short sales can start before an offer is submitted, but more often than not, the bank will begin the process after they’ve received an accepted offer. The listing agent will then send several items to the bank once the seller accepts the offer, including the listing agreement, the offer, the buyer’s letter of pre-approval, a copy of the deposit check, and the seller’s short sale package. It’s important that this package has everything needed without anything missing, or else the short sale process can be delayed.

As the buyer of a short sale, you should be prepared to wait a long time before hearing from the bank. Since you must get approval from the seller’s lender first, then take the final agreement to your own lender get a mortgage, a short sale can be pretty lengthy.

Every case is different, so there really is no exact time frame within which it will take each short sale to be approved. However, it can take anywhere from a few weeks to even a few months before approval is granted.

The listing agent will have to keep tabs on the bank and call in periodically to make sure the short sale process is proceeding. However, your agent can’t speak with the lender without being authorized to do so.

Just be sure to work with an experienced real estate agent to help you navigate the short sale process, and get pre-approved for a mortgage before putting in an offer.

The Bottom Line

If it’s a deal you’re after, then short sales may have something for you. However, they also come with potential issues that you will need to deal with before you get the keys to your new home. Done right – and with the assistance of a seasoned real estate professional – you can come out a winner with an awesome house at a fantastic deal.

After searching for a new home, negotiating an offer, and going through escrow, buyers are aware of the steps that need to be taken to ensure a successful transaction. But the work isn’t over just yet. As soon as you get the keys to your new abode, there are a few things that need to be tackled before you kick your feet up.

Here are 8 things you should do right after your real estate deal closes.

1. Store Your Closing Documents in a Safe Place

All the documents that you signed at closing should be secured in a safe place to prevent theft or destruction. Make copies of the originals and store them each in separate areas. Keep the photocopies in a robust filing cabinet that locks, and the originals in a safety deposit box at your bank. You can also choose to store them virtually on a cloud-based website or software like Dropbox. That way you’ll still have easy access to them while keeping them safe at the same time.

2. Change the Locks

Many buyers don’t think to change the locks after they get possession of their new home, but this is a task that should be done for security purposes. While one of the contingencies in a real estate contract is for all the house keys to be provided to the buyer at closing, there’s no way of knowing whether a key or has been copied and retained by the seller.

You may also want to consider installing keypads on all of your exterior doors rather than just changing the locks. This smart home feature is becoming increasingly popular and allows you to gain access to your home without a key. You can always change the code whenever you wish to increase security measures on your home. If the home already came with a keypad, you’ll obviously want to change the code immediately after moving in.

3. Inform People and Companies About Your New Address

Once the deal closes and you move from your old home into your new one, you will need to get in touch with important companies to inform them of your new mailing address. This list can be rather lengthy, and can include the following:

• United States Postal Service (USPS)
• Work
• IRS
• Bank
• Insurance company
• Phone, internet, and cable company
• School
• Department of Motor Vehicles (DMV)
• Place of worship
• Medical offices (doctor, dentist, etc)
• Accountant
• Newspaper

Of course, you’ll also want to keep your friends and family in the loop of your new address so they know where to go to visit you for your housewarming party!

4. Give the Home a Deep Cleaning

While your real estate contract might stipulate that the sellers must leave the home free of debris, they likely won’t be giving the place a good scrub-down before they vacate. As such, you should have the home deep-cleaned before you even move your belongings in.

That includes washing all the windows, steam cleaning the carpets, mopping the floors, washing the drapery, cleaning the appliances, scrubbing tile grout, and cleaning out the gutters. You might even want to go so far as to wash the walls, especially if the previous owner was a smoker. To really freshen things up, go the extra mile and give the walls and ceilings a fresh coat of paint.

5. Locate the Main Water Shutoff

You’ll definitely want to know where the main water shutoff valve is if you ever experience a broken water pipe. Every second matters when it comes to the amount of damage that open water can cause, so the quicker you can shut off the main source of water, the better. Not only should you ask where this water shut-off valve is, you should also test it to make sure it actually works.

6. Consider Improving the Home’s Energy Efficiency

If you’re buying an older home, odds are it’s not very energy efficient if the sellers have never made any improvements. There’s a lot of money that can be saved on your utility bills every month and every year, so it may be worth your time and money to have an energy audit conducted to identify any areas in your home that are wasting energy – and therefore wasting your money.

Professional energy auditors will scope out your home, pinpoint areas that require attention, and make recommendations on how to rectify any issues to help save energy and keep more money in your pocket.

7. Look Into Tax Credits and Deductions

Many first-time buyers aren’t aware that they can take advantage of some tax credits and deductions when buying a home. In California, first-time homebuyers have several tax credits that they can tap into.

The Mortgage Credit Certificate (MCC) tax credit program allows first-time homebuyers to deduct a portion of mortgage interest that was paid directly from federal taxes that they owed. This tax credit is equal to 20% of mortgage interest that is paid during the year. If this is itemized on your tax return, you can still take a deduction for the remaining 80% interest that was paid.

8. Go Out and Meet the Neighbors!

It’s nice to get to know the neighbors who you will be living amongst after you move into your new home. While you don’t necessarily have to be best friends with everyone on your block, it’s still a good idea to be able to rely on each other to keep the neighborhood safe, report any suspicious activity, and even have contact information in the case of an emergency.

The Bottom Line

After escrow closes, you probably just want to move your belongings in and start enjoying life in your new home. You certainly can, but there are certain tasks that need to be done right away to help maximize your enjoyment of your new place. Being a homeowner comes with new responsibilities, many of which should be taken care of immediately following the closing of the deal.