June 24, 2011 5:27 pm
In 2010, over three million home service contracts, often referred to as home warranties, were purchased nationwide—the greatest number in the history of the industry.
Internet-based Angie's List often publishes reports advising consumers to be smart when buying a home service contract. The National Home Service Contract Association (NHSCA) agrees and offers further guidance.
Based in Olathe, Kans., the NHSCA is a non-profit 501(c) (6) industry trade organization of member companies serving home service contract providers and consumer interests throughout the United States. While a growing number are marketed directly to consumers, the majority of contracts are purchased as part of a real estate transaction or subsequent renewal.
There is little doubt that the record number of contracts reflects the fact that consumers are seeking security and financial protection due to the current economic environment. Home service contracts provide the peace of mind that helps alleviate potential concerns of both home sellers and buyers during the resale transaction and for one year following the close of sale. In addition, renewal customers have continued protection from aging home systems, appliances and utilities.
Home service contracts vary in the details of benefits provided. The market is competitive and consumers have many choices regarding benefits, service and pricing. NHSCA member contracts are typically a few pages and outline complete terms and conditions of coverage. Consumers should compare contracts and consider the systems, appliances and utilities unique to their property to better assess their needs. If you live in a rural area, you may wish to consider adding well pump or septic tank protection. Do you have a pool or a spa? Do you wish to cover a freestanding appliance such as a refrigerator in your garage?
While the price of the product and optional coverage available is important, so are many other factors. Consumers should consider a number of questions in order to ensure they are making a wise purchase. Is the contract written in simple, easy to read and understandable language? Does the company clearly identify what services are not covered? Is the trade fee for each service call clearly disclosed? Is there an aggregate limit per system or appliance, per service call or per contract? Can a service call be placed 24/7 every day of the year? Is emergency service available when necessary? Is there a clear process that can be followed if the services rendered are not satisfactory?
It is also important for consumers to acknowledge that “everything” cannot be covered by a contract that typically costs less than $500 a year. While contracts cover many breakdowns, there must be reasonable limitations. NHSCA members paid out well over one-half billion dollars to local contractors in 2010 to service customer’s homes. Even so, NHSCA members are always working to make contracts easier to read and understand as the industry strives to close any potential gap between available benefits and customer’s expectations.
Consumers should be confident that their home service contract provider has a solid reputation for serving its customers. References from real estate professionals and friends and a rating from the Better Business Bureau can be extremely helpful in the selection process. Either the state attorney general or insurance commissioner regulates all providers. (In Texas it is the Texas Real Estate Commission.) Contact the appropriate state agency to inquire on a provider's standing.
“If a consumer doesn’t take the time to perform their own ‘due diligence,’ they may well end up as another statistic,” Gwen Gallagher, President of Old Republic Home Protection, says. “What is important to consider is that out of the three million contracts sold, and four million service calls provided by the home service contract industry last year, only a very small fraction of consumers were not satisfied with either the coverage or service they received.”
An even smaller number of those may lodge a complaint on Internet sites such as Angie’s List, where they appear to receive disproportionate attention. The fact is the overwhelming majority of consumers value their home warranty protection and remain quite happy with both coverage and service.
The NHSCA offers additional consumer-friendly information on their website, homeservicecontract.org.
June 23, 2011 5:27 pm
Q: Are shared equity and shared appreciation mortgages the same?
A: No. With a shared appreciation mortgage, or SAM, a borrower receives a below-market interest rate in return for the lender receiving a share, usually 30 to 50 percent, in the future appreciation of the property upon its sale.
Introduced in the early 1980s, when interest rates were high enough to make qualifying for a mortgage a real challenge, the SAM has never really caught on. Adjustable rate mortgages (ARMs) proved more attractive.
June 23, 2011 5:27 pm
Builder’s warranty. Written statement by a builder assuring that a dwelling was completed according to a stipulated set of standards. It protects the buyer from any latent defects.
June 23, 2011 5:27 pm
Those nearing retirement have some serious advice for younger generations willing to listen, according to a recent study conducted by Persuadable Research Corporation.
The key pearls of wisdom shared by these elders? Lead a healthy lifestyle or pay the price later. Save for the future. Love your family and treasure your friends.
Health issues are the top concern among people as they age. Issues of losing mental capacity, simply looking older and becoming physically weaker are realities seeming to sneak up on many panelists queried in the May 2011 study focusing on aging.
“Never thought much about it as I was advancing in age,” admits one panelist. “But I realize that we took our health for granted. If you didn’t live a healthy lifestyle before, you’ll be aging with a multitude of health problems.”
“I hate it,” echoes another respondent. “Your body starts to show wear and tear and get too many aches and pains. You don’t realize how good you had it when you were younger.”
Aside from regretting lifestyle choices that began 10 or 20 years prior, many panelists nearing retirement—or who are already retired—also wish they’d arrived at certain financial realizations sooner.
And they aren’t the only ones clearly identifying the long-term effects of youthful missteps. Some economic experts claim as many as 3 out of every 5 of future retirees are at risk for outliving their financial resources. Getting an early start to retirement savings is one of the prevalent bits of advice bestowed by professional money managers and retirees alike. When Persuadable Research study participants were pressed to share specific recommendations, elder consumers routinely warn their younger counterparts not to waste money on things that might qualify as a ‘passing fancy,’
“Save, save, save,” imparts a money-conscious survey panelist. “Even if you think you can’t afford it, put some money away regularly.”
Perhaps adjusting to recent economic turbulence, more people may be reshaping their retirement dreams to better match financial constraints. Retiring later is the most obvious consideration for many. While 34 percent of the Persuadable Research study panelists say they plan to retire between 61- 65 years-of-age, 20 percent are delaying that life change until the 66-70 birthday milestones. Another 17 percent plan to retire after age 71. And even after retiring from their current positions, over one-third of the respondents plan to continue working either part-time, full-time or manage a small business.
The retirement dream many consumers are saving for? A small home they can manage in a warm climate, preferably close to a pool or a beach. Generally speaking, most aspiring retirees say they would prefer to live close to friends and family members—especially grandchildren.
If the grandchildren happen to live in an exotic location nestled within the tropics? All the better. Regardless of the specific location, however, cash-strapped parents struggling to adjust to rising day care costs are increasingly encouraging retiring grandparents to fill in the young-family gaps and help facilitate moves so retirees can live closer. Retirees, after all, often have flexible schedules that can be a good match for child care needs. Meanwhile, parents may be able to reciprocate with a small financial compensation—one that’s significantly less than traditional day care expenses.
Still, the mantra of a successful outcome involves one key aspect: good planning.
Persuadable Research offers full service market research expertise all from an online market research company you can trust.
June 23, 2011 5:27 pm
Cobra Electronics Corporation (NASDAQ: COBR), a designer and manufacturer of consumer and mobile electronics, recently offered consumers a simple checklist of its 'Top 10 Safety Tips for Summer Driving Preparedness' as people across the country gear up for their summer driving adventures:
1. Plan Ahead. Plan your trip in advance, considering weather forecasts, road construction, alternate routes, and even refueling locations in advance of long stretches of rural roadways.
2. Get Inspected. Have your car inspected before departing, with attention to fluid levels, lights, battery, belts, tire condition, air conditioning, brakes, and spare tire condition.
3. Stay Awake. According to the National Highway Traffic Safety Administration, drivers falling asleep at the wheel account for 100,000 U.S. crashes annually. Develop a plan that involves frequent stops, stretching, and regular driver rotation.
4. Avoid Alcohol. Alcohol is a key factor in fatal traffic crashes, playing a role in about half of all motor vehicle deaths. That makes weekend nights even more dangerous. In fact, more fatal crashes take place on weekend nights than at any other time of the week.
5. Stock Up. One of the most dangerous summer driving situations involves becoming stranded in a hot, desolate location due to mechanical problems. Your safety kit should therefore include sunscreen, plenty of water, first aid kit, spare car keys, food supplies, flares or reflective triangles, gloves, and spare engine coolant.
6. Get a Map. Even if you know your route well, always carry maps, a GPS navigation unit, or a smartphone app with GPS mapping or navigation.
7. Stay Aware. There are many potential sources of driving mishaps, most of which can be avoided by staying alert at all times. Monitor cockpit gauges frequently, and be aware of the weather, road conditions, accidents, road signs, and stop lights. Over 450,000 injury crashes occur annually in adverse weather and road conditions according to the US Department of Transportation.
8. Slow Down. Watch your speed and obey posted speed limits. Lower speeds also mean better gas mileage.
9. Be Prepared. In the event of trouble, the right tool can be a life saver. Recommended equipment includes a tire jack, basic tool kit, jumper cables and/or jump starter, alternate power source, air compressor, and flashlight/emergency light.
10. Stay Connected. Don't forget your mobile phone and charger programmed with important numbers, including your insurance agent and AAA. Two or more phones in the car are even better.
To learn more about Cobra Electronics, please visit www.cobra.com.
June 23, 2011 5:27 pm
When you are ready to remodel or renovate your pre-1978 home, it's important to hire a Lead-Safe-Certified professional, recommends the National Association of Home Builders.
Before being banned in 1978, lead was a common ingredient in exterior and interior house paint, and is still present in many older homes. Lead ingestion has been shown to cause developmental delays and disabilities in young children.
In April 2010, the U.S. Environmental Protection Agency enacted the Lead: Renovation, Repair, and Painting rule that requires training in lead-safe work practices for all remodelers working in pre-1978 homes. EPA Lead-Safe Certified Renovators are equipped to use lead test kits, educate consumers about the dangers of lead and use prescribed lead-safe work practices.
"Lead-Safe Certified Renovators are trained to help keep your family safe from lead exposure during your remodeling project," says NAHB Remodelers Chairman Donna Shirey, CGR, CAPS, CGP, and remodeler from Issaquah, Wash.
"It always pays to get the job done right," says Shirey. "Remodeling professionals have expertise in design solutions, managing product choices and completing beautiful projects. Plus lead-safe certification means the remodeler will understand and apply practices to minimize dust and lead exposure and protect the safety of your family."
When planning your home remodel, read the EPA's Renovate Right pamphlet to better understand the dangers of lead exposure and how to conduct a safe home remodel. Consider hiring a certified risk assessor or lead inspector to determine if your home contains lead paint. After completing the renovation, be sure to maintain records of the work that's been done.
For sound advice on lead safety, visit www.nahb.org/leadsafe. To find an EPA Lead-Safe Certified Renovator near you, contact your local home builders' association or use the search tool at http://www.leadfreekids.org/. For more information about home remodeling, visit www.nahb.org/remodel.
June 22, 2011 5:27 pm
Q: Is equity sharing a good idea?
A: A shared equity mortgage, or partnership mortgage, can be a good way to purchase a home with little or no money down. In such an arrangement, the borrower/home buyer has an absentee partner who, as the investor, provides all or some of the down payment.
Equity sharing is not as popular in a slowly appreciating real estate market as in a rapidly appreciating one when equity investors are easy to find. A type of equity sharing called tenants-in-common partnerships is becoming increasingly popular, especially in high-priced markets.
First-time buyers are usually most interested in a TIC arrangement because it gives them a way to buy property collectively with an unrelated partner.
Loan underwriting standards are more complicated with these types of deals because lenders have more than one party's financial situation to assess.
It is a good idea to hire an attorney to help draft a shared equity agreement.
June 22, 2011 5:27 pm
Breach of contract. When one party fails to live up to the terms and conditions of a contract, without a valid, legal excuse.
June 22, 2011 5:27 pm
Scan the news today and the message is clear; our planet is facing an environmental crisis and many Americans are facing an economic one as well. As many people deal with tightening their belts and trimming expenditures, they struggle with the dilemma of saving the planet or saving cash.
MXenergy, a leading independent energy provider, wants customers to realize the struggle is an unnecessary one. In fact, a "green mindset" can actually help save you money.
"There seems to be the perception that a commitment to the environment is going to cost you," says Marjorie Kass, MXenergy Managing Director. "And while it is true that some environmental decisions, such as purchasing organic produce, can have a higher price tag, many choices and lifestyle changes can actually save you money."
For those interested in saving cash while helping the planet, MXenergy offers the following tips:
• When dealing with your home energy usage, a home energy audit is a great place to start. Simple steps such as changing to energy efficient lighting, sealing leaks around windows and doors, adding insulation to attics and walls, and fixing water leaks can all save you energy and money. Many utilities now offer customers programmable thermostats, which have been shown to reduce energy usage as well. Turning down your water heater, washing clothes in cold water, and plugging in to power strips are also easy decisions that ultimately save you cash.
• Think before you buy. Put the bottled water back on the self and opt for a good aluminum water bottle instead. Not only will you save the cost of water, you will be eliminating plastic. Consider planting a vegetable garden. You save dollars at the grocery store, gas for the drive and get the peace of mind knowing your garden produce doesn't have any added chemicals or toxins. Composting is great for your garden and also reduces the amount of trash and waste you produce each week.
• Go green behind the wheel. While a new high efficiency car may not be in your budget at the moment, that doesn't mean you can't save money and reduce your carbon footprint. Simple actions such as properly maintaining your vehicle, making sure your tires are properly inflated, combining errands and carpooling to work all save cash and earn you environmental bonus points.
• "I think what becomes clear is the fact that we all have simple choices we make each and every day that impact both our planet and our bank account," says Kass. "What we want to do as a company is not only help people save money on their utility bills but in all aspects of their everyday lives through inexpensive changes that also protect our planet."
June 22, 2011 5:27 pm
A new national report shows that U.S. public libraries continue to expand as technology centers for communities, providing essential resources for job-seekers and support for critical e-government services. In addition, as the demand for e-books increases, libraries are the starting place for free downloads.
However, budget cuts have forced libraries across the country to scale back drastically on operating hours and access to services, just when resources are most needed.
The 2011 Public Library Funding & Technology Access Study reports that virtually all public libraries (99 percent) provide public access to computers and the Internet. More than 87 percent of libraries provide technology training, and more than two-thirds (67 percent) of libraries offer access to e-books, up 12 percent from two years ago.
Yet a pervasive "new normal" of increased demand for library technology resources, paired with decreased funding at state and local levels, is impacting service to millions of Americans, according to the report released recently by the American Library Association (ALA).
"We've seen our libraries and communities struggle throughout this uneven economic recovery. Since the recession began, libraries have grappled with budget cuts and decreased hours, while users wait in lines before doors open, eager to use library computers or access Wi-Fi, get expert assistance for job search, and learn how to download e-books," says ALA President Roberta Stevens. "We want patrons—and policymakers—to understand the dynamic resources available at today's library and keep those resources funded. Let's make sure that our investment in libraries yields its full potential."
While 70 percent of libraries report increased use of public computers, and more than half of libraries report an increase in use of electronic resources, 55 percent of urban libraries report operating budget decreases during the current fiscal year, followed by suburban (36 percent) and rural (26 percent) libraries. At the same time, 16 percent of libraries report decreased operating hours, a jump from 4.5 percent just two years ago.
For the third year, the greatest impact was experienced by those living in urban communities; nearly 32 percent of urban libraries report reduction of open hours, up from 23.7 percent last year.
Not surprisingly, libraries report again that services for job-seekers rate as the most important public Internet service provided to the community.
More than 74 percent of libraries offer software and other resources to help patrons create resumes and employment materials, and 72 percent of libraries report that staff helped patrons complete online job applications. Yet, 56 percent of libraries report they do not have enough staff to effectively assist job-seekers.
Increasingly, as government agencies eliminate print forms and close satellite offices, public libraries are the front lines, connecting people with essential e-government resources.
Nearly 68 percent of libraries report that staff provided assistance in completing government forms, and one-quarter of all libraries partnered with government agencies and non-profit organizations to provide e-government services. An Oklahoma library director reports that a major employer no longer distributes printed W-2s to employees. Since only a small percentage of residents have Internet access at home, employees had to depend on library computers and printers to retrieve the forms.
The proliferation of e-books marks a milestone in public libraries; the number of libraries that offer e-books has increased almost 30 percent since 2007.
"We've seen a dramatic increase in people coming to the library with their e-readers, eager to learn how to use it with the library e-book collection. It's a great opportunity to showcase our expansion into digital services. As a technology hub for our 26 communities, we make sure to feature a wide range of resources for users," says Contra Costa County Library (Calif.) Deputy County Librarian, Cathy Sanford.
"Millions of Americans each year go to their public libraries to seek educational resources, government services, employment information, and opportunities to improve their lives," says Jill Nishi, deputy director of U.S. Libraries and Special Initiatives at the Bill & Melinda Gates Foundation. "As libraries struggle to meet the growing needs of their communities, against the pressure of significant financial constraints, it is crucial that both public and private partners consider how they can help libraries sustain the critical services they offer."
Conducted by the ALA and the Information Policy & Access Center at the University of Maryland, this year's study builds on the largest study of Internet connectivity in public libraries that began in 1994. The study functions as an annual "state of the library" report on the technology resources brokered by our libraries and the funding that enables free public access to these resources.
The study, funded by the Bill & Melinda Gates Foundation and the ALA, can be found online at www.ala.org/plinternetfunding.