Question (CA): Is it true that no one will refi my home with the "no penalty" clause if they know I am going to put it on the market, or if they find out it was listed in the previous six months? Someone told me people usually refi first then list their homes for this reason. Lastly, are there many "no penalty" refi's around or are they pulling my leg?

Answer: The answer to your question ("yes" it is true or "no" it is not true) lies within the policies and procedures of the primary lenders to whom your loan is submitted. Shawn Welling, a Senior Loan Officer working for a Texas Mortgage Brokerage, CelebrationLending.com (George C. Stephens, Mortgage Broker License #10581) did some research for us. Here are selected segments of his report:

"As you probably saw within the e-mail I sent to many of the lender account reps with which we conduct business, about half of them had no seasoning requirements for rate/term refinance loans (NO CASH-OUT) with regard to a house previously being listed for sale. Chase, Countrywide's Specialty Lending Group and Equifirst (two large "nationwide" lenders and one smaller lender) only require proof that it is no longer listed. In fact, Countrywide will even do a cash-out refinance, and New Century (one of the largest non-prime lenders) will consider it with an acceptable letter of explanation as to why it was listed and why now the refinance."

"Chase, Wells Fargo, Equifirst and First Franklin all require 6-month seasoning to do a cash-out loan. As for the pre-payment penalty, in Texas it is illegal to charge a pre-payment penalty on a cash-out loan. With rate and term refinances it varies between lenders and what the borrower can qualify for ... . Fannie/Freddie conforming loans typically do not have pre-payment penalties, although I have seen 4-month penalties on the wholesale side."

"It would have been much better for this reader to refi before listing, but there are still some options; just not as many. To have ALL his options restored he needs to be 6-months from removal or expiration of the listing."

As for your question regarding the number of "no-penalty" refi's around, that normally depends upon a number of variables too lengthy to deal with in this column. We suggest you contact several reputable CA mortgage brokers with this question.

Question (GA): I recently purchased a four year old townhouse in Atlanta. About a month after moving in I discovered water coming in through the basement. We tore up the carpets and sheetrock all over the basement and discovered seven cracks in the foundation, two of which had water leaking in causing rot as well as mold.

The seller, who had bought the house from the builder, did not list anything in the disclosure about any foundation problems and/or water entry, and the inspector missed the signs of water damage when we were closing. The cost for the repairs is about $35,000 dollars, and I feel I should not be responsible for the repairs. I believe the previous owner did know something about the water damage as carpets were replaced in one of the rooms downstairs. The seller, I also believe, should be especially liable for this as he is a real estate agent for an extremely large commercial real estate company. What should be my next move?

Answer: The first question to ask, in our opinion, is how do you know the seller knew? It was a new house, apparently, when the seller bought it. The seller may have thought he corrected the problem when he replaced the carpet. A plaintiff can spend a lot of money discovering facts, only to find out that the seller is not culpable.

We suggest that you might want to first communicate with the real estate agent/seller and inform him as to what you have discovered. You may also wish to find out if there was a builder's warranty that might cover this repair that could have been transferred to you at closing. You might also let him know that your own inspector missed the indications of the foundation problems and water penetration you've encountered.

The best thing that could happen is that this real estate agent will want to avoid involving any lawyers and/or handling potential implications of improper actions on his part to the Georgia Real Estate Commission. The worst thing is that he is unsympathetic to your plight and challenges you to sue him. If that happens, you still have the option of hiring a Georgia attorney who is successful in handling this type of case.

Question (IN): I recently bought a lot in a newly developing subdivision. After I bought the lot all the lot owners were told by the developer that our home owners' dues are not enough to cover the expenses to maintain the subdivision. The developer still owns more than 70 percent of the lots (he has yet to sell them). He has control over the homeowners association. He is not paying any dues on his unsold lots to the association. The dues to run the subdivision are paid by 10 lot owners which are not enough to run the subdivision.

Is it legal for him not to pay dues to the association for the lots he owns? If he is illegal in not paying his part of the dues for his lots what are our options?

Answer: It is not unusual for the developer of a homeowner's association to maintain control of the association until a specified benchmark of sales is reached -- which could even be 100 percent. As for the developer's right to increase the amounts comprising the assessments (or even special assessments), the body of the HOA documents (sometimes also referred to as Covenants, Conditions and Restrictions or CC&R's) should contain the specific language that provides the developer that right. The exception to that, however, is if that language runs afoul of the applicable Indiana statutes. In order to ascertain that, we recommend you provide the CC&R's to an Indiana attorney, successful in homeowner association litigation to provide you a legal opinion.

Question (MA): You recently answered a question about a home warranty company called "National Home Protection."

You apparently are unaware that this appears to be a scam operation. I, and many others, have purchased warranties from them and then had that company refuse to do any actual warranty work. In my case, I had a failed furnace and fully 12 days passed without any response from them. I finally hired and paid for my own contractor. There are many complaints against this company, BBB filings, etc.

Answer: We believe you are referring to a question from a reader in Georgia. The reader in Georgia was simply asking if we had heard of or knew anything about "National Home Protection." We answered by suggesting he perform an Internet search using specific keywords. We noted that among the firms that were returned to us using Google, was one called "National Home Protection." Additionally, we also recommended he conduct a search of the Better Business Bureau's database and provided him the URL pertinent to his location.