Question: I'm in the process of buying my mother a house for cash. She is 71 and very poor. Her only income is what I give her and her Social Security.
Is there a way to call this property a rental and write it off as a loss? Would it be smarter to put ownership in both of our names?
Answer: The property can be a rental if your mother pays a fair market rent. Ask a tax professional if you can treat the property as a rental if your mother paid you fully by check each month -- and if it would also be okay for you to separately give your mother a cash gift of up to $11,000 a year.
Putting your mother on the title may raise estate issues and also open the property to claims by a state government if Medicaid is required for your mother. For details, look into the Medicaid Estate Recovery Program in the jurisdiction where she lives. Also, speak with an attorney who specializes in elder law regarding wills and living wills for you and your mother -- and look into providing a "life estate" so your mother can always stay at the house.
Question: Can you please explain what is a loan discount?
Answer: You may be thinking of "points" which are also known "loan discount fees."
A point is equal to 1 percent of the mortgage amount. If the rate is 6 percent interest plus 1 point, the real rate over a 30-year period is 6.125 percent -- an interest increase of 1/8th percent over the loan's 30-year term. However, since loans rarely last 30 years, the payment of a point up front at closing is likely to be a much higher cost than 1/8th of a percent.
Question: I am a sales agent and when I write offers I frequently find the phrase "ten days after attorney review ends" in the "Additional Deposit (date)" area of the contract. Is there a better approach?
Answer: "Ten days after attorney review ends" is an expression which is hardly precise. What if the attorney requires six weeks to review the agreement? A better approach might be to have a date certain, saying the review must be completed by March 10, 2006 at 4 PM or the agreement will be considered acceptable (or unacceptable, if preferred). An attorney can provide proper advice and language.
Question: I purchased a townhouse in December to rent but I have not been able to find a tenant. It's a two-bed, two-bath unit that originally rented for $1,100. I have decreased the rent to $950 to see if it attracts more renters. I have advertised through local papers and the Internet, but I still have not had any inquires. How can I bring in a renter?
Answer: Has something happened in the local area that would quickly reduce rents by 14 percent? Was $1,100 a fair market rental? Is $950 the right rental at this time?
Rentals involve more than price. What other features does the property offer? For instance, are dogs allowed -- if yes, this could be an important point to advertise. What about amenities at the townhouse community? Local attractions such as easy commuting or nearby shopping?
Rather than change the rental rate, perhaps it would be best to change the marketing approach. As well, it would be cheaper to hire a broker than to reduce the rent.
Question: Can a real estate agent pay another real estate agent a referral fee for referrals? And can a real estate agent pay a marketing company a referral fee for referrals?
Answer: A real estate salesperson cannot pay referral fees to another salesperson. A salesperson works under the authority of a broker -- it is the broker who can pay fees. Speak with your broker for specifics in your jurisdiction.
As to marketing companies, as a salesperson you may purchase advertising if okay with your broker (think of a classified ad in a local paper where payment is due for space whether or not a property sells) but you may not pay a referral fee, compensation related to performance. Your broker, however, may pay referral fees. Again, speak with your broker for details.
Question: I am the newly-elected president of our townhouse association. The articles of incorporation and the by-laws have no meeting notice requirement for Board of Directors meeting which we hold monthly in a member's home. I have been told we need to post a notice or a sign notifying our members of the time and place where the meeting is to be held. We are not comfortable notifying the general public of these meetings which are limited really to the members of the board and members of the association who have asked to attend. We are not currently having any member making a serious complaint, but have the usual "idea hamster" person asking for an "opinion."
Would you offer one?
Answer: It's terribly difficult to get condo owners to attend association meetings, so why would a member of the general public want to attend such an event? Post the notice in a place where condo members can be informed of the meeting -- or send everyone a timely notice by mail.
Question: I've been in my home for 21 months and am starting a business that will most likely take me to California. I need to sell to be there -- am I eligible for a prorated tax break?
Answer: The IRS says an individual may be entitled to a partial write off if "the qualified individual's new place of employment is at least 50 miles further from the residence sold or exchanged than was the former place of employment, or, if there was no former place of employment, the distance between the qualified individual's new place of employment and the residence sold or exchanged is at least 50 miles." For specifics, please speak with a tax professional.
Question: Do you know of any good sources to track days-on-market info? I'm a real estate consultant researching days-on-market information for a number of markets in my state.
Answer: Most MLS systems openly publish statistics that track sales, prices, listing volume and days-on-the-market. Since some MLS systems are regional rather than local, it's often possible to get information for many areas at once.
Question: I had a lease-to-purchase. The seller agreed to sell me the house for $225,000. He even took $4,000 from me. He then sent me a contract, but it was supposed to be under my mother's name. He never sent a contract again and is selling to someone else. Now he is evicting me. Shouldn't the $4,000 mean that he cannot do this? How do I make him sell me the property on the terms we agreed on?
Answer: What terms were accepted by both you and the owner? He sent you an offer -- which you did not accept because it did not show your mother as the buyer, thus he sold to someone else.
As to what is or is not allowed, you need to take all paperwork to an attorney to determine your rights. This should be done immediately before ownership is transferred to a third party.
Question: I live in the UK and I'm currently in the process of purchasing some land within the Upper Cape area of New Brunswick. The land is 3.4 acres on the coast and the price is around $12,000. Is this a good price for this region as it seems quite low priced?
Answer: Price is a relative matter. It may well be that such pricing as you quote is reasonable for the area -- or perhaps steep.
The problem is that you are a long-distance buyer. Without a thorough knowledge of the local area it's not possible to say what pricing is reasonable. Your best approach is to spend time in the local community to better understand area values and to work with a local buyer broker.
Question: Could you please advise me as to how I can obtain a copy of the settlement statement from the purchase of my home?
Answer: Try the party who conducted closing or the title insurance company.
Question: I sold my home (primary residence). The purchaser had a nonprofit down payment assistance grant that cost me $5,200 in closing costs. I was told by HUD that I can write off the "gift" funds as well as the numerous fees that I was told I must cover because buyer also had an FHA loan. How do I document the costs I had selling the home?
Answer: Take a look at the HUD-1 form that was used at closing to show your costs. It may have a reference to the grant that can be used to support a gift claim. For details, speak with a tax attorney, CPA or enrolled agent.
Question: My parents live in NY and own a summer home near my house in Florida. Due to illness they would like to give me the house in Florida as a gift. Should they sell it? Will they have to pay a capital gains tax? Should they just transfer the property to me or sell it to me. They want me to eventually sell my small home and their property to purchase a larger home so that they can live with me when able to travel.
Answer: A house is a large asset so giving it to you may set off the need to pay a gift tax. Although it's not a happy thought, everyone may be better served if you receive the property as an inheritance -- in that way you would receive the property at its stepped up value and there would be no capital gains or gift tax. See a tax professional and have an attorney who specializes in elder law advise your parents. 
