Real Estate 2009

Buying a foreclosed home may be the best step you've ever taken -- or the worst. The process is rife with hazards, from unanticipated fees and tax liens to hidden structural damages that can cost thousands to repair. Still, the thought of getting a house or condo at a bargain basement price can be enough to get you in a buying mode. Purchasing a foreclosure is ideal for someone with patience, said financial planner Rich Arzaga, chief executive of California-based Cornerstone Wealth Management. "Someone's pain may be a buyer's gain," he said.

House flipping is still alive. The number of flippers is much smaller than it was a couple of years ago, but some determined investors are still active at the practice -- and making money. Buying bargain-priced residential properties and quickly reselling them at a profit was a huge segment of real estate market activity in the past. Some investors added cosmetic improvements to their purchased house, while others resold them as soon as possible with scant improvements.

Dear Ms. Lank: What is a short sale? -- K. Answer: When you owe more on a mortgage than your property is worth, and you need to sell, sometimes a lender will accept whatever you can get on the open market, and forgive the rest. That's known as a short sale. It's better on your credit record than a foreclosure would have been, and the IRS no longer taxes you on the unpaid balance. First, though, your lender must agree. Often they want proof that you don't have other assets you could use to repay the shortfall. And they reserve the right to approve or disapprove of any offer you want to accept for your place, so it can be a cumbersome and frustrating procedure before you arrive at a binding contract. See the next letter.

Whether you're moving in a month or have plans to stick around for a few years, chances are your house will be back on the market at some point. A few inexpensive improvements will make a big difference in the bottom line. But why let the next owners have all the fun? Get your home showroom-ready now and you might just fall in love with it all over again.

Whether you plan to buy or rent, a wallet full of credit cards, high balances or even a single late payment may be enough to bounce you from today's housing marketplace, experts say. What's more, there are no quick fixes to repair it. "The only way to improve your credit report, and therefore your credit scores, is to change the way you manage your credit over a period of time," said Rod Griffin, Experian's public education manager. "Credit scores don't just look at whether or not your payments are current at this moment in time. They consider your payment history over long periods. The key to good credit scores is to demonstrate a consistent habit of good credit management."

Often called "the American dream," home ownership has been both a source of satisfaction and consternation for many. Potential buyers wish for financial rewards on their investment along with the pride of owning property. When the math works, the investment does too -- but when it's off, the losses can be significant. Finding the ideal place and being able to afford it can be a challenge.

Home ownership involves more than just paying a monthly mortgage and utility bills. Insurance is an often-repeated word in home ownership. However, it can get confusing: There is property, mortgage, title and liability insurance -- plus each state has its own laws to regulate it. "When you are buying a home, there are many things you need to know about properly insuring the home," said David Zwierecki, owner and operations manager at First Security Financial Services in Ohio.

Nearly everyone has heard horror stories of excited homeowners who have purchased their "dream home" -- only to discover they've invested in a money pit. That's why, whether you are buying or selling a piece of property, home inspections are critical to the real estate process. It just makes good sense to hire a certified home inspector when you are either buying or selling a house, said Nick Gromicko, founder of the International Association of Certified Home Inspectors.

With interest rates at historic lows, this may be the best time to buy a house or condo -- that is, if you can qualify for a mortgage. Getting pre-approved for a mortgage can make the difference between being able to buy your dream home or watch your opportunity slip away. "Particularly in today's market, it's important to secure funding," said Realtor Pat Vredevoogd Combs, vice-president of Coldwell Banker AJS-Schmidt in Grand Rapids, Mich. Combs, who served as president of the National Association of Realtors (NAR) in 2007, points out that despite a tightened credit market, financing is available for those who qualify.

There's an old adage that says, "When the going gets tough, the tough get going." This motto certainly applies to real estate agents who are competing for your attention in trying financial times. However, regardless of the economy, the real estate business has always been very competitive, said Stephanie Singer, a spokesperson for the National Association of Realtors (NAR).

With home prices dramatically dropping and a shaky and uncertain economy, potential buyers and sellers face complex decisions. Luckily, there are savvy and seasoned professionals to offer guidance navigating through the current real estate reality. And don't worry about jumping right in -- it can lead to the best opportunities. "You cannot be afraid to get into the market," said Realtor Sue Correnti of Gilleran Griffin Realtors in Los Angeles. "There's a lot of inventory out there."

The amount of vacant homes in the U.S. is on the rise, with Alaska having the highest vacancy rate of all 50 states.

There are many ways to insure your home, but it's important to have personal property coverage. Here's how to keep it up to date.

Your home project shouldn't cause you headaches. Here are some tips to allow smooth sailing through any remodeling project.