Dear Edith: We have an older house with lead paint on most of the interior wood (door casings, stair treads). Are we required to eliminate all that before putting the house up for sale, or just disclose it to potential buyers? — B. D.
You will present buyers with a signed statement about the presence of lead paint, and that's sufficient. Much old paint has been covered by now. If it's not flaking off, buyers aren't usually concerned.
Dear Edith: Our neighbor may be a hoarder. His yard is full of all kinds of junk and lately it's moving into his driveway, which is on our side. We may want to sell in a year or two and that's not going to help our sale. I don't want to complain to the government because he is a nice guy. Do you have any suggestions? — askedith.com
You're right in thinking that the neighboring junk will affect the sale price of your property. Appraisers call it external obsolescence, loss of value from a condition beyond the property.
Over the years, I've heard from a couple of readers who offered to help with cleanup. Not "You're a slob" but "We're doing all sorts of things to spiff up our house for sale." Maybe that would work for you.
Senior Wants Mortgage
Dear Edith: I am recently retired, single. I wish to sell my home and relocate to Florida. Does it make sense for a 72-year-old woman to apply for a 20-year mortgage? I could pay cash but want to conserve it. I would use much of the profit from my home as a down payment and finance about $90,000. — J. S., www.askedith.com
There's no reason why an older person can't carry a mortgage. Lenders aren't even allowed to ask your age.
As you are older than 62 and not concerned about bequests to children, you may be interested to hear that reverse mortgages can be used for buying a home. You need prove only that you can pay the property taxes and homeowners insurance premiums.
The program requires a substantial down payment (often with proceeds from the sale of a current larger home). After that you make no further monthly payments. They just pile up, including interest and mortgage insurance premiums, until you die or move out. At that point the sale of the house covers the debt, even if it's become higher than the value of the property. Or if there's money left over, it goes to you or your estate.
Losing on Sale
Dear Ms. Lank: Our son moved to an island and in 2008, we purchased a townhome there to rent out and use to visit his family. We paid $177,500. It is on the golf course and an end unit. First question: Will it bring more because it is an end unit? $5,000 more?
We are paying $20,000 a year between mortgage and association fees. We never earned more than $6,000 a year in rental income. We owe around $121,000 on the place now.
The economy there tanked in 2012 when the major employer went out of business. A couple of years ago, someone dumped their property for $68,500. Prices are slowly coming back up. Two units are on the market for $28,000 and $35,000, but they are in a poorer location.
Our rental agent isn't doing much and our contract is up Feb. 5. We need a selling agent. Can we go with someone different in the same company? We will have one shot to sell this because the season is now through May.
We will have to come up with money for closing. Will we have tax write-offs because of selling so low? Should we list more than $135,000 since we are an end unit and top category, or list lower to sell it fast? Finally, we have marginal furniture. Is it worth buying more so it shows better? It is well-maintained and recently painted. — L. K., www.askedith.com
Don't put any more money into the place. Don't try to get a higher price — take your agent's recommendation, and offer it at a bargain.
If you've been reporting the property as a rental on your income tax returns, you should be able to declare a capital loss. Your accountant will know how to account for depreciation.
You can certainly ask that company for a different agent. Depending on what documents you have signed, you may be free to interview agents from other companies as well. Pay attention to their price suggestions. If you don't set yours low enough to attract buyers, you'll just be stuck with expenses for another year.
Edith Lank will respond personally to any question sent to www.askedith.com, to 240 Hemingway Drive, Rochester NY 14620, or to [email protected]
Photo credit: Emilio Küffer