Real Estate Investing

Many members of my family live near the New Madrid Fault Line in western Kentucky.  That fault runs from Southern Indiana to west Tennessee and covers parts of Missouri and Illinois.  We hear time and again the the earthquake that comes every 100-years is due, but thankfully nothing has happened yet.  I do know that we don’t really have a plan in place for when it does hit, but maybe the terrible quake in Haiti will spur people to start planning for an emergency.

I’ve been grieving for the people of Haiti… if it wasn’t already terrible enough, I just returned from lunch and read the headline that up to a half million people could have perished.   Are you ready for an earthquake?   For example, do you have earthquake insurance?  It’s not a standard item that your insurance would automatically cover – like flood insurance you have to add it and pay an extra premium.

When it comes down to it, survival is first – it’s most important.  NEMA says the key to surviving is to plan ahead.

The key to surviving any disaster situation is planning. To survive an earthquake several factors must be considered. The time of day, location of family members at the time, the type of structure you are in and the utilities that supply that structure. Every plan should include escape routes at home and work, a reunification site and a telephone contact for communication. Discuss plans with all household members. Teenagers and adult members of the household should share in the actual preparation decisions. Be sure to consider any special needs or disabilities of family members and unique natural or man-made hazards near your home. Make sure everyone in your household knows where the closest fire station, hospital, and police station are.

What about the structure of your home?  Would it withstand a quake?  The article states,

Single family wood frame buildings are the most earthquake resistant of any type of construction. The building moves with the quake. The key to riding out a quake is to make sure your home behaves as one continuous unit.

Click here to read how to bolt the house to the foundation, whether you have “cripple” walls, and how to see if your chimney is secure.

Meanwhile, let’s keep the people of Haiti in our thoughts and prayers in these coming weeks.  If you want to make a monetary or other donation, be careful of who you give through.   MSNBC.com provides a list of reputable agencies who can accept your donations, including the Red Cross, Hope for Haiti, Mercy Corps, and the Salvation Army.

I love me some Google search engine.  I can find old friends.  Figure out if I had a concussion the other night after falling.  Compute when the space station will be flying over my house.  Double check whether I’m giving my dog too much flea medicine.

And now Google got even better!

You can plug in a city name, street name, state, or other location to see what houses are for sale.  All you do when you go to Google maps is click the “Real Estate” drag down box where it has show all maps.

Here’s what’s available in San Francisco, California.

Summer too hot for you?  Check out the listings in Grand Forks, North Dakota.

One of my friends is going to Cocoa Beach, Florida later this month.

Isn’t this fun?

Several days ago – before I disappeared for part of the week to attend my oldest daughter’s summer orientation for college – I caught this article from the New York Times and bookmarked it for readers here at Banks.com.   Financial writer Edmund Andrews wrote a riveting, heart-wrenching story about his personal credit crisis through a mortgage catastrophe.

Mr. Andrews found himself in a situation where he wanted to buy a home but because he was paying alimony and child support – and because his fiancee wasn’t yet working – he needed one of those *special* loans that dominated the 2005-06 buying years.

I thought I knew a lot about go-go mortgages. I had already written several articles about the explosive growth of liar’s loans, no-money-down loans, interest-only loans and other even more exotic mortgages. I had interviewed people with very modest incomes who had taken out big loans. Yet for all that, I was stunned at how much money people were willing to throw at me.

Mr. Andrews first found himself moving toward a “stated income” loan where he could declare what his income was with no paycheck receipts or tax returns produced as evidence of his earnings.   However, he quickly learned that his name was still on the mortgage being paid by his ex-wife so this plan put his debt to income ratio over the limit.

Bob didn’t get flustered. If Plan A didn’t work, he would simply move down another step on the ladder of credibility. Instead of “stating” my income without documenting it, I would take out a “no ratio” mortgage and not state my income at all. For the price of a slightly higher interest rate, American Home would verify my assets, but that was it. Because I wasn’t stating my income, I couldn’t have a debt-to-income ratio, and therefore, I couldn’t have too much debt. I could have had four other mortgages, and it wouldn’t have mattered. American Home was practically begging me to take the money.

Years later the family financial situation is sinking.  Mr. Andrews managed to save his marriage with his new bride, but they are bracing themselves for either foreclosure – or maybe they’ll be able to work with the lender to refinance.  For now they wait.  It’s been eight months since he made a mortgage payment.  Eight months without knowing what will happen would be torturous to me.  I can’t imagine how he and millions of others are feeling right now.

Go read Mr. Andrews full story.