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Jewish World Review Feb. 28, 2000 / 28 Adar I, 5760

Bruce Williams

Bruce Williams
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Rely on a real-estate lawyer -- DEAR BRUCE: Three years ago my husband and I purchased a home. I went alone to the loan application because my husband had a prior appointment.

Upon reviewing the loan documents the day of the closing, I questioned the note. The trust deed showed our names, but the note made a specific notation of my husband's name, saying he was in no way responsible for paying for the loan.

I protested this notation, and the lender acknowledged the error and allowed us to refinance at no cost to correct the note properly. There were other paperwork problems, but I am now told that everything is under control. I trust my husband completely but no one knows what the future holds. -- L. (e-mail)

DEAR L: Nowhere did you indicate that you had an attorney representing you in this matter. Yours is a classic case of technical difficulties arising with no one at the closing truly understanding them. This is why I would never, ever consider buying a piece of real estate without being represented.

If it were me, I would take the documents that you currently have and let an attorney look them over.

DEAR BRUCE: I am currently renting a townhouse for $1,250 a month. I can buy a new one for $260,000 with about the same monthly expense after paying $105,000 down. I will probably be leaving this area in the next five years, and I am concerned about having to sell a townhouse if I buy. Who knows if the market will exist?

Should I continue to rent and remain flexible, or should I buy a townhouse, build equity and get the tax advantage? -- J.H., Los Alamos, Calif.

DEAR J.H.: You have painted a bright picture of the financial advantages of owning a home, but you've overlooked the fact that you've given up $105,000 invested.

In today's marketplace, aggressively investing that $105,000 could easily generate $15,000 to $20,000 a year. Put another way, how much equity will you have developed in a house over your down payment in the first year?

In this circumstance, even if you weren't thinking about moving, assuming you can rent a unit about the same size and quality for $1,250 a month, it's a no-brainer.

DEAR BRUCE: Several years ago I got deep into credit-card debt -- I owed about $25,000. At that time I was in this country on a worker's visa that had expired, and I was in an expensive legal battle to remain in this country. I voluntarily left when my options ran out.

The debt, which was incurred in 1993, still remains unpaid. Now I am back in the United States, but it will take me years to pay this off. I know you don't recommend bankruptcy lightly, but is there any other option for me? -- M.B. (e-mail)

DEAR M.B.: There are always options. Whether they are viable is another matter.

You failed to indicate what your income is now, and that is a significant piece of information. In the event that your income is sufficient to pay this off in a few years, I would urge you to go to one of the non-profit debt counselors scattered across the country. They may very well be able to negotiate a better deal than you would be able to, and you can conclude this debt honorably.

Send your questions to JWR contributor Bruce Williams by clicking here. (Questions of general interest will be answered in future columns. Owing to the volume of mail, personal replies cannot be provided.) Interested in buying or selling a house? Let Bruce Williams' "House Smart" be your guide. (Sales of the book help fund JWR).


02/23/00: Keeping child's money safe from divorce
02/16/00: Just how important is a 401(k)?
02/14/00: Shaky partnership buying house
02/11/00: Protection by residential zoning
02/09/00: Benefiting from a reverse mortgage
02/07/00: Ensure your insurability
02/04/00: Absurd community zoning laws
02/02/00: Money or securities?
02/01/00: Can we KO a custodian?
01/31/00: Why sell a home you love?
01/26/00: Everyone needs a will
01/25/00: Will splitting stocks affect rollover?
01/24/00: Should early retirees contribute to SEP?
01/21/00: Strategies for paying off debt
01/20/00: Is 15-percent growth achievable?
01/19/00: Selling a second home
01/18/00: Running from a time-share
01/14/00: Don't be a spendthrift!
01/13/00: Who gets the house?
01/11/00: It all depends on size of estate
01/06/00: Check references before hiring an advisor
01/04/00: Savings bonds a bad investment
12/31/99: Out of state ain't that great
12/29/99: Warranty rip-offs
12/27/99: Checking up on investment handlers
12/23/99: Options good only when company's strong
12/20/99: Capital gains tax sometimes best
12/17/99: Don't give up your nest egg
12/15/99: Small-claims court no panacea
12/13/99: Termite company not liable for termites?
12/10/99: Services provided must be paid for
12/06/99: How do we minimize house-sale gain?
12/06/99: Maximize your tax shelter!
12/02/99: My neighbor won't maintain even a modicum of civility
12/01/99: Long-distance rentals a bad idea
11/29/99: Mortgage strategy A-OK
11/18/99: Students can work and learn
11/16/99: Value is what will sell
11/11/99: Y2K: No big deal for real estate
11/08/99: Real life is tough luck
11/03/99: The right time to cash a savings bond
11/01/99: Slow road for savings accounts
10/29/99: What do you want from insurance?
10/27/99: You have a right to see your tax forms!
10/25/99: Why own a house at 65?
10/22/99: Online fine, but CDs?
10/20/99: Love, honor -- and separate credit
10/18/99: Find the value of your stocks
10/15/99: Property lien prevents trade
10/13/99: Clear up debt, only then tie the knot
10/11/99: If it ain't broke...
10/04/99: Should I stick with the company IRA?
10/04/99: Get a financial education!
10/01/99: Insurance: Not much one person can do
09/30/99: Lost tickets are lost cash
09/29/99: Trusting only one financial planner
09/27/99: Adult children should help out
09/24/99: Tips for first-time home buyers
09/21/99: Use the rule of 72s!
09/17/99: Legal strategy can be a pain
09/15/99: Teen drivers drive up insurance
09/13/99: Always use an attorney!
09/10/99: Whose taxes are they, anyway?
09/08/99: How do I roll over my 401(k)?
09/03/99: How can I work out my IRS payments?
09/01/99: When your company can't pay you
08/30/99: Beware of shady viatical investments
08/26/99: Landlords vary on security deposits
08/25/99: Educational IRAs must be spent on education
08/23/99: Finding out the value of old stocks
08/20/99: How to get an FHA refund
08/19/99: 100 percent financing is a scam
08/16/99: Will I have to pay a capital gains tax?
08/16/99: Thinking about PMI
08/13/99: Short-term mutual funds a-OK
08/11/99: It's your job to shop around
08/10/99: Sometimes, roots need to be uprooted
08/09/99: 'Pre-approved' doesn't mean a thing
08/06/99: Only you can determine your investments
08/04/99: Bank IRA the lowest-risk option
08/03/99: Reverse mortgages good for the elderly
08/02/99: Get the survey BEFORE you buy the house!
07/28/99: Get a lawyer -- it's worth it!
07/27/99: If it ain't broke...

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