Probably one of the most famous phrases in American history was delivered by Patrick Henry on this day in 1775 and is credited with having swung the balance in convincing the Virginia House of Burgesses to pass a resolution delivering the Virginia troops to the Revolutionary War. Among the delegates to the convention were future US Presidents Thomas Jefferson and George Washington. Reportedly, those in attendance, upon hearing the speech, shouted, “To arms! To arms!”

“No man thinks more highly than I do of the patriotism, as well as abilities, of the very worthy gentlemen who have just addressed the House. But different men often see the same subject in different lights; and, therefore, I hope it will not be thought disrespectful to those gentlemen if, entertaining as I do opinions of a character very opposite to theirs, I shall speak forth my sentiments freely and without reserve.

This is no time for ceremony. The questing before the House is one of awful moment to this country. For my own part, I consider it as nothing less than a question of freedom or slavery; and in proportion to the magnitude of the subject ought to be the freedom of the debate. It is only in this way that we can hope to arrive at truth, and fulfill the great responsibility which we hold to God and our country. Should I keep back my opinions at such a time, through fear of giving offense, I should consider myself as guilty of treason towards my country, and of an act of disloyalty toward the Majesty of Heaven, which I revere above all earthly kings.

Mr. President, it is natural to man to indulge in the illusions of hope.

We are apt to shut our eyes against a painful truth, and listen to the song of that siren till she transforms us into beasts. Is this the part of wise men, engaged in a great and arduous struggle for liberty? Are we disposed to be of the number of those who, having eyes, see not, and, having ears, hear not, the things which so nearly concern their temporal salvation? For my part, whatever anguish of spirit it may cost, I am willing to know the whole truth; to know the worst, and to provide for it.

I have but one lamp by which my feet are guided, and that is the lamp of experience. I know of no way of judging of the future but by the past. And judging by the past, I wish to know what there has been in the conduct of the British ministry for the last ten years to justify those hopes with which gentlemen have been pleased to solace themselves and the House.

Is it that insidious smile with which our petition has been lately received? Trust it not, sir; it will prove a snare to your feet. Suffer not yourselves to be betrayed with a kiss.

Ask yourselves how this gracious reception of our petition comports with those warlike preparations which cover our waters and darken our land. Are fleets and armies necessary to a work of love and reconciliation? Have we shown ourselves so unwilling to be reconciled that force must be called in to win back our love?

Let us not deceive ourselves, sir. These are the implements of war and subjugation; the last arguments to which kings resort. I ask gentlemen, sir, what means this martial array, if its purpose be not to force us to submission? Can gentlemen assign any other possible motive for it? Has Great Britain any enemy, in this quarter of the world, to call for all this accumulation of navies and armies?

No, sir, she has none. They are meant for us: they can be meant for no other. They are sent over to bind and rivet upon us those chains which the British ministry have been so long forging. And what have we to oppose to them? Shall we try argument?

Sir, we have been trying that for the last ten years. Have we anything new to offer upon the subject? Nothing. We have held the subject up in every light of which it is capable; but it has been all in vain. Shall we resort to entreaty and humble supplication? What terms shall we find which have not been already exhausted? Let us not, I beseech you, sir, deceive ourselves.

Sir, we have done everything that could be done to avert the storm which is now coming on. We have petitioned; we have remonstrated; we have supplicated; we have prostrated ourselves before the throne, and have implored its interposition to arrest the tyrannical hands of the ministry and Parliament. Our petitions have been slighted; our remonstrances have produced additional violence and insult; our supplications have been disregarded; and we have been spurned, with contempt, from the foot of the throne! In vain, after these things, may we indulge the fond hope of peace and reconciliation.

There is no longer any room for hope. If we wish to be free– if we mean to preserve inviolate those inestimable privileges for which we have been so long contending–if we mean not basely to abandon the noble struggle in which we have been so long engaged, and which we have pledged ourselves never to abandon until the glorious object of our contest shall be obtained–we must fight! I repeat it, sir, we must fight! An appeal to arms and to the God of hosts is all that is left us!

They tell us, sir, that we are weak; unable to cope with so formidable an adversary. But when shall we be stronger? Will it be the next week, or the next year? Will it be when we are totally disarmed, and when a British guard shall be stationed in every house? Shall we gather strength by irresolution and inaction? Shall we acquire the means of effectual resistance by lying supinely on our backs and hugging the delusive phantom of hope, until our enemies shall have bound us hand and foot?

Sir, we are not weak if we make a proper use of those means which the God of nature hath placed in our power. The millions of people, armed in the holy cause of liberty, and in such a country as that which we possess, are invincible by any force which our enemy can send against us.

Besides, sir, we shall not fight our battles alone. There is a just God who presides over the destinies of nations, and who will raise up friends to fight our battles for us. The battle, sir, is not to the strong alone; it is to the vigilant, the active, the brave. Besides, sir, we have no election. If we were base enough to desire it, it is now too late to retire from the contest. There is no retreat but in submission and slavery! Our chains are forged! Their clanking may be heard on the plains of Boston! The war is inevitable–and let it come! I repeat it, sir, let it come.

It is in vain, sir, to extenuate the matter. Gentlemen may cry, Peace, Peace– but there is no peace. The war is actually begun! The next gale that sweeps from the north will bring to our ears the clash of resounding arms! Our brethren are already in the field! Why stand we here idle? What is it that gentlemen wish? What would they have? Is life so dear, or peace so sweet, as to be purchased at the price of chains and slavery? Forbid it, Almighty God! I know not what course others may take; but as for me, give me liberty or give me death!”

Posted in: Patriotism
Tags: american history, famous phrases, patrick henry, Patriotism

Posted in: Holidays
Tags: st patricks day

Here’s a tough situation for a homeowner. You bought your house for $300,000 a few years ago. You owe $250,000 on the mortgage and can hardly afford to make the payments anymore. You want to sell, but values have tanked in your area and the best price you can get is $200,000.

Should you wait until values come back up and rent it out in the meantime? Unhappy with bids coming in, many homeowners have been doing just that. (In fact, last summer Treasury Secretary Timothy Geithner rented out his family’s five-bedroom $1.635 million home in Larchmont, N.Y., after it sat on the market for several months.)

But this strategy doesn’t always make financial sense. It can be almost as hard to rent your home as selling it, and there are costs associated with renting that you might not have considered, including insurance and management fees. Plus, if you’re betting the market will recover and you will get more from a sale down the road, you might be risking too much.

“If it costs, say, $9,000 to hold onto the house this year, are you sure it’s going to appreciate $9,000 in the next 12 months?” says John Vogel, a professor of real estate at the Tuck School of Business at Dartmouth. “Given what’s going on with unemployment, plus the time and hassle involved in managing a house, it’s far from a sure bet.”

What’s more, home prices nationwide are forecast to fall more than 8% in 2010, according to data from Moody’s. “There’s at least as good a chance that the market will be worse a year from now as it will better a year from now,” says Vogel.

Despite recent signs of stabilization in the overall economy, it’s still a renter’s market. Rising unemployment has dampened rental housing demand and contributed to a 3.4% decline in asking rents in 2009, according to real estate investment services firm Marcus & Millichap. The firm estimates that the single-family home rental vacancy rate has risen to 10% at the end of 2009 from 7% in 1997. That’s slightly down from the 10.5% it was in 2007, but it’s still higher than last year’s 8% apartment vacancy rate. “We’re at an all-time high vacancy rate for apartments as well as single-family homes that are on the market for rent,” says Hessam Nadji, managing director of research services at Marcus & Millichap.

New construction is partially to blame for the supply overhang. More than 120,000 apartment units came into the market in 2009, driven by developers who had obtained financing before the credit crisis really hit, according to Reis, which tracks the real estate market. High apartment vacancy rates have pushed owners to lower rents, says Peggy Abkemeier, president of Rent.com, an online rental marketplace – making apartments more attractive for at least certain types of renters. Abkemeier says that while there has been an uptick in renters seeking homes for rent on Rent.com, apartment-related searches still remain more popular than house-related searches.

“You have to realize, you’re not the only one with a house on your hands that you don’t want to sell at the moment and want to rent out,” says Janet Portman, a real estate lawyer and author of “Every Landlord’s Legal Guide.” Assess the market and find out if houses like yours are a dime a dozen – if it is, the rent you’d collect might be lower than you hoped for, she says.

And because of the oversupply, in some markets it’s also taking longer to find renters than it did a couple of years ago – and that means lost rental income. “Now the competition is greater in the higher-end markets, and it might take four months to rent a home, whereas before you could rent one in 30 days,” says George Pabst, president of Pabst Kinney & Associates, a property-management firm in Long Beach, Calif.

For frustrated sellers still intent on becoming landlords, here are a few points to consider:

* Typically, renting makes sense if you plan on returning to the home – say, if you were taking a sabbatical or were being transferred for a year to another city for your job.

* You’ll be getting income each month – but it should cover your monthly expenses, including mortgage payments, utilities, property taxes and higher homeowner’s insurance costs.

* You must pay federal taxes on the rental income – but at least some of that amount could be offset with deductions for operating expenses (mortgage interest, repairs, utilities) and depreciation.

* Don’t forget that tenants aren’t going to keep your property as tidy as you would, says Diane Saatchi, a senior vice president at Saunders Associates, a real estate brokerage in Bridgehampton, N.Y. As much as possible, you should carefully screen prospective renters to make sure they’re financially stable and good housekeepers.

Posted in: Sell Your Home
Tags: real estate investment, renter, rents, single family, unemployment

NEW YORK (CNNMoney.com) — Lots of people, especially those trying to battle high utility bills, believe in energy-efficient homebuilding.

But there’s something holding green technology back: It simply costs more to include it than it adds to resale value

Appraisals for newly built green homes do not fully reflect the cost of green technology, and the lower appraisal values mean buyers often cannot get the full financing they need from banks.

That discourages developers from using green technology, in turn diminishing the market for more green products.

“We can’t get lenders to appreciate the value, and if we can’t get the values recognized, manufacturers can’t justify moving these products forward,” said Bill Nolan, a Florida home building consultant.

How that works is illustrated in the case of clients of Michael Chandler, a North Carolina-based green building adviser, who wanted to build a $400,000 home incorporating many green features.

The house was designed to include passive solar heat, solar hot water, radiant floor, high-performance windows and insulation. But the bank’s appraiser told them that the appraisal would come in for less than the cost to construct.

In that case, the buyers would need to come up with a bigger down payment.

“Our best guess is that it will appraise at $380,000,” said Chandler. At 90% financing, the bank would put up $342,000, leaving the would-be buyers with a down payment of $58,000, instead of the $40,000 needed if the house was assessed at the full price.

“With 10% down, the clients would have to come up with (an extra) $18,000,” Chandler said. “They can’t do that.”

Appraisers feel their hands are tied.

“It doesn’t do a lot of good to simply add value based on cost,” said David Snook, a California-based appraiser who serves on the real property committee on education for the American Society of Appraisers. “The question is ‘How much will the market pay on resale?’”

The appraiser’s job is to accurately assess the value of the home. If a feature costs $50,000 to install but only adds $25,000 to the price when the home is resold, the appraisal cannot reflect the full $50,000 spent.

“Appraisers don’t make the market, they reflect it,” said Jim Amorin, spokesman for the Appraisal Institute. “Cost does not necessarily equal value. It depends on how the market reacts to the feature.”

Not under the influence
Also complicating appraisals these days are new rules to prevent loan originators from influencing appraisals. Builders cannot demand specific appraisers, ones more experienced at evaluating green building.

With Chandler’s client, the house is in a rural zip code, one where few energy efficient homes have been constructed. The appraiser had little idea of how much building green adds to value.

“The appraiser has no experience with green building,” he said.

Another problem is that appraisers also rely frequently on foreclosed homes for comparison, especially in places hit hard by defaults. These homes sell at big discounts to the regular market and even bigger discounts to green homes.

Low cost alternatives
Because of the appraisal issues, developers often opt for installing only the lowest-cost green features.

“Some can be incorporated without much additional cost,” said Curt Jones, a Connecticut-based civil engineer and green building consultant. As he describes the process for green certification, points are given for a wide variety of factors, some costing a lot, others costing nothing.

Angling the home a little differently, for example, to catch more rays and help heat the house passively, may not cost the builder a dime. But installing solar panels on the roof definitely will add a lot to the final price.

Ironically, turning green probably does add considerable value — or will, once green gets more established in individual locales and buyers get more familiar with it.

In Seattle, a hotbed of green-building activity, new homes with green certification sell for 8.5% more per square foot than comparable non-green ones, according to a report from GreenWorks Realty. They also sell 22% quicker.

“As more American homeowners green their homes, there will be more and more of a premium paid for green homes,” said Ben Kaufman, GreenWork’s founder. “I can imagine a miles-per-gallon type sticker on homes for sale and the marketplace will absolutely favor fuel-efficient homes.”

Posted in: Sell Your Home
Tags: american society of appraisers, facepalm, green technology, homebuilding, passive solar heat, resale value, solar hot water, value appraisals

Posted in: Stuff and Nonsense
Tags: the ides of march, vehicle

Homebuyers who need a loan insured by the Federal Housing Administration, or FHA, may be able to buy a recent foreclosure house now that the FHA has waived its so-called “anti-flipping” rule. This rule banned the use of an FHA-insured mortgage to buy a home that was being resold within 90 days of purchase.

The rule was enacted to reduce mortgage fraud. But over time, the effect was to hinder buyers who needed an FHA-insured loan and wanted to buy a home that had been bought at a foreclosure auction and fixed up by an investor for resale. The waiver should now allow these borrowers a better chance to buy those homes.

“FHA borrowers, because of the restrictions we are now lifting, have often been shut out from buying affordable properties,” FHA Commissioner David H. Stevens said in a statement. “This action will enable our borrowers, especially first-time buyers, to take advantage of this opportunity.”

Will lenders relax anti-flipping rules?
The waiver is a positive step, but its effects may be limited, according to Peter Thompson, a senior mortgage consultant at Wintrust Mortgage in Downers Grove, Ill.

“The FHA has relaxed the rule, but we have to look at how lenders are interpreting it,” he says.

Wells Fargo has introduced its “first phase” of the waiver, which will allow qualified borrowers to use an FHA loan within 90 days of the seller’s acquisition of the property if the purchase price is not more than 20 percent greater than the seller’s acquisition cost.

Bank of America hasn’t made a decision about how to handle the waiver. A representative for J.P. Morgan Chase said the bank “appreciates any policy that allows quicker sales” of bank-owned real estate, but that the waiver “will not have a major impact.”

Anti-flipping waiver has some restrictions
Buyers should be aware of the FHA’s limits on the anti-flipping rule waiver, which are as follows:

• The home sale must be at arm’s length, which means there can be no close business or personal relationship between the seller and buyer.
• If the price that the buyer agrees to pay for the home is more than 20 percent higher than the price the investor paid to purchase it, the sale will be subject to extra scrutiny to ensure that the value hasn’t been inflated.
• The Home Equity Conversion Mortgage for Purchase program is excluded from the waiver. This program allows older homeowners to combine a reverse mortgage and a home purchase.
• The 90-day time period might be shorter or longer than 90 calendar days due to the way the start and end dates are determined. The start date occurs when the sale is recorded. The end date occurs when the purchase contract is signed.
• The waiver began Feb. 1, 2010, and will last one year, unless the FHA extends or withdraws it. The waiver can be withdrawn if there is a significant increase in defaults or mortgage insurance claims on FHA loans that were used to buy flipped homes.

Homebuyers typically don’t encounter the anti-flipping rule until they’ve found a house they want to purchase and been told they can’t use an FHA loan unless the investor has owned the home for at least 90 days. Buyers who are concerned about this pitfall should ask when the investor purchased the home, what the sale price was and whether FHA financing will be allowed.

Waiver not expected to result in fraud
The anti-flipping rule originally was imposed in 2003 to reduce mortgage fraud that involved quick resales of properties purchased through straw buyers and had artificially inflated appraisals.

The FHA granted a long list of exemptions from the rule. For example, homes sold by most government agencies and nonprofit organizations were exempt. That meant buyers who wanted to use an FHA loan could purchase those homes, but not other homes that had been bought and repaired by private investors, within 90 days. The waiver will level that playing field.

Skeptics might wonder whether the waiver could set off a rise in loan fraud. Thompson suggests that’s unlikely because the loan environment has changed since the anti-flipping rule was enacted. One change is that drive-by appraisals, which were quite common, have given way to stricter appraisals rules and that lenders now examine appraisals “with a fine-toothed comb,” he says. That should reduce the risk of fraud.

The bottom line on property flipping and fraud, according to a letter officials at the California Association of Realtors sent to the FHA in November 2009, is that “a property resold with 90 days by a legitimate investor is no longer synonymous with fraudulent or predatory practices.”

Homebuyers who need an FHA loan should be able to take it to the bank.

Posted in: Home Buying
Tags: bank owned real estate, federal housing administration, fha loan, first time buyers, foreclosure auction, mortgage consultant, mortgage fraud

Your offer to purchase should be crystal clear for the seller.

Take this question recently posted at the real estate site Trulia.com:

I made an offer that was accepted and now the seller wants to change a major aspect of the house that matters to me, the new buyer b4 closing.

..The sellers listing read: 3 bedroom single family with “expandable attic”. I saw it, fell in love made an offer which they countered and I accepted as long as they installed funcioning heat. They accepted now they want to install 2 seperate furnaces, 1in the basement & in the attic which isnt acceptable to me because I wanted to finish and expand the attic into a master bedroom. The original furnace was in the basement anyway not in the attic. This will drastically change the homes usable square footage and the space that I need for my family. I already paid the appraisal, the inspection and a full year home owners insurance in advance as well as my earnest money. I really want this home but the seller doesnt seem to care that this isnt what I want.

From this question it is clear that the buyer wanted to be able to finish the attic in some way. But what did the contract say?

Judging by the question and what is currently going on, I can guess that the offer was written with language something like this:

Seller to have a heating system adequate to service the attic installed at sellers expense by a licensed heating contractor prior to closing or this contract shall be considered void at the buyer’s option.

On it’s face this looks pretty good. You have the seller paying for the system, you have a contractor putting it in, you have a timeline of when it should be done and you have an out for the buyer if the work isn’t done. But whoever wrote the clause didn’t take into account the buyers wishes or the fact that certain kinds of work can be completed in various ways. In this case, I am thinking that there wasn’t adequate ducting to get the heat from the basement furnace to the attic without not only buying a more powerful furnace but also having new ductwork run up to the attic at what could possibly be a huge expense. One can’t blame the seller for opting for the less expensive, but adequate, furnace directly in the attic. According to the way I guessed at the clause above, the seller has fulfilled the obligation.

To properly get the buyer’s wishes across and properly protect them in the transaction the clause should have been written something like this:

Seller to have installed at seller’s expense a heating and cooling system, including ductwork, adequate to properly heat and cool the attic area of home via the basement (primary) unit(s) as recommended and installed by a licensed heating and cooling contractor prior to 3 days prior to closing or this contract shall be considered null and void at the buyer’s option.

In this clause, you have what needs to be done (install a heating and cooling system, including ductwork of sufficient power to properly heat and cool the attic from theunit in the basement), who pays for it (seller), who not only does the work but determines the adequacy of the system (the licensed contractor) and by when (3 days prior to closing). Why did I use “prior to 3 days prior to closing”? I am sure that “prior to closing” would be good enough, but that gives them literally up to the time the buyer signs the closing paperwork thus creating possible inconveniences for the buyer should the work not be completed. I prefer to have any work done prior to the buyers final walk through so that if the work isn’t adequate it can be properly addressed and the closing postponed, if necessary.

Thanks, Mr Armchair Quarterback, But What Can This Actual Buyer Do?

As it stands, and assuming my guess at the actual clause was correct, there is not much that the buyer can do at this point. By my estimations the buyer has two courses of action.

1. In the question the buyer stated that she bought the home because of the expandable attic and the home was advertised as having an expandable attic. Should the heating system the seller is installing significantly reduce the useable space – or usability of the space – the buyer could get out of the deal or force the seller to install the system she was thinking about when she wrote the offer because the expandability of the attic was material to the offer. This is an outside longshot. Very outside and very long. To go with this would certainly involve an attorney and still may not work out to the buyer’s wishes.
2. The buyer should offer up an amendment to the offer removing the above language in the offer requiring “functioning heat” and then request that the seller either credit to the buyer or, better yet, escrow the amount he was going to spend on the attic furnace. This way, the buyer can take that money and do exactly what she wants to do. Anything over and above the attic furnace quote would come out of the buyers pocket, but would probably be less than the attorney’s fees from option 1 (above).

   Furthermore, if the buyer is the one having this unit installed they could be eligible for up to $1,500 in tax credits plus WE Energies is offering other cash rebates. So, if she spent, say $6,500 on a furnace, central air, ductwork, new water heater** and chimney removal** should could be eligible for up to $800 back from WE Energies!

When writing an offer be sure to be as specific as possible. Better yet, hire a qualified and detail-oriented Buyer’s Agent to represent you in the transaction. Their service is free to the buyer and can save you $1,000′s!

*NOTE: I may have being generous in my guess as to how the actual clause was written. Notice that the buyer’s question used the term “functioning heat”. “Functioning” just means that the system has to work, not adequately heat the given area.

**If the current water heater vents up the chimney, she could have it removed and replace with a direct vent model and if the furnace is also direct vent, then she can have the chimney removed (and get $75 back from WE Energies) and that would then provide an easy pathway for the needed ductwork!

Posted in: Home Buying
Tags: buyer's agent, Home Buying, offer to purchase

The current Home Buyer Tax Credit has a cut-off date of April 30th for first time and move up home buyers to have an accepted offer on a home to qualify for either an $8,000 or $6,500 tax credit. The purchase must then close prior to June 30th to qualify.

“Conventional” wisdom would then suggest that as of May 1st, people will stop buying homes. I do not think that this will be the case nor should it be.

Buyers still in the market on May 1st could encounter some great deals. Sellers thinking that because the credit is gone their home will never sell will panic. Expect prices to drop to compensate for the loss of the credit. You can also expect that sellers will look at and even accept offers they normally would not have prior to April 30th. So, rather than getting $8,000 back from the government (taxpayers like you and me), a first time buyer could negotiate an additional $8,000 off the price of the home in either discounts or pre-paid closing cost credits. This could have a better, long term effect on the buyer than a one-time lump sum of $8,000.

Home buyers in the upper ends of the market will also see a greater benefit than they would with the tax credit. Remember, there are income limits to the tax credit: $125,000 for singles and $225,000 for couples. At those income rates buyers won’t qualify – and, may never see the credit anyway as it may be absorbed by their income tax liability. But, this is not necessarily common knowledge among sellers and even agents. May 1st, sellers may also be in a panic and ripe for accept lower than normal offers from buyers.

Buying a home for most people is a life-changing experience and shouldn’t be predicated upon getting a rebate – we’re not talking about cars here! The best time for anyone to buy a home is when they are ready. Buyers should have their ducks in a row before making a purchase and completely forget about the tax rebate when it comes to making a decision.

$8,000 is no compensation if you are not financially ready to buy a home or if your job is on shakey standing. It should also not be enough to cause you to buy the wrong house just to get it.

If you are actively in the market looking for a home and nothing has come up, don’t panic. On May 1st, you might have advatages you don’t have right now.

Disclaimer: I am not saying you should definitely wait until after May 1st to make an offer on a home that you like. I am simply offering another way of looking at what the market will bring after the home buyer tax credit accepted offer deadline runs out. If you are financially ready to buy a home and have found a home you can see your self living in for many years to come, then go for it! (And call me if you don’t already have an agent!)

Posted in: Housing Market
Tags: buying a home, first time buyer, home buyers, income tax liability, tax credit, tax rebate