Remember to Mind Your Manners on the Internet

It has been said that people who curse lack the vocabulary to put their feelings into words.

Some people writing on the Internet apparently have this fault. Not that they all use swear words, but their rudeness shows the same deficiency. And the anonymity of the Internet makes them believe it's OK to insult or threaten people without fear of reprisal.

When writers can't see the consequences of rudeness on the recipients' faces or hear it in their voices, it is easier to cross boundaries. But people who use pseudonyms while posting to Web sites can be trackable through their Internet Protocol addresses.

In her "Miss Manners" column, Judith Martin says the Internet is reflecting the increasing rudeness in everyday life as displayed on talk radio, TV talk shows, and in political discourse.

"Society has gotten very abrasive," Martin says. "In the slightest altercation, people come out swinging and swearing. Civilization is about thinking before you express everything."

Interviewed by USA Today, Craig Newmark, founder of Craigslist says, people on the Net are overwhelmingly trustworthy and civil to each other. But there are fanatics and crazy people out there. On many sites, however, people are kind and supportive.

It is to your benefit to be among those who are trustworthy and civil.

Blessings to Your Real Estate Investing Successes,

Milton B. Yates
www.miltonyates.com

Calculating Retirement Income from Rental Properties

Whether you have a 401k or other retirement plan, income from a rental
property can make your later years more enjoyable.

        
After finding one in your price range, the next step is calculating its
cash flow. That means determining what your annual expenses will be and
deducting them from the rent. The balance is your cash flow.

       
Depreciation sounds like an expense, but it is generally a tax advantage.
On a $125,000 property, for example, the depreciation over 27 and one-half
years comes to $3,636 per year. This is a tax deduction.

       
In the early years of your mortgage, interest will reduce earnings on the
property so you won't have much of a profit. During this time, the
depreciation comes in handy to reduce taxable income from other sources.
In later years, it will reduce the amount of tax you pay on rental profits.

        
When you retire, you can use monthly rental income for normal expenses
and travel.

       
Or you can sell the property and have a lump sum to use for something you
always dreamed of, like a luxury RV in which to tour the country. In years
to come, your property could double in value.

      
Some things to consider when looking for a rental property:

        
* Good location. Today, rents are rising and will continue to rise in
stable neighborhoods. The location should be not too distant from where
you live now.

        
* You can often buy a duplex for not much more than a single family home,
and rents will be higher.

        
* Find a building that's not too old so it will comply with building, zoning,
and fire codes. And it will have lower maintenance costs. Have it inspected.

       
* Have your real estate agent tip you off to a building with an out-of-town
owner who is eager to sell. Sometimes such owners will take a two- or five-year
contract for deed, which means a very small down payment.

Blessings to Your Real Estate Successes,

Milton B. Yates
www.miltonyates.com

Deciding Whether to Buy or Build (Impact Fees)

Impact fees are taxes. They are a new kind of tax that many cash-strapped
cities are assessing on remodeling and new home construction. Depending on
where you live, they can be substantial.  You won't find 'impact fees' in
every city or county.
    
You'll find impact fees used in some cities in South Carolina, California,
Oregon, Florida, Colorado, Arizona and Washington.  Typically the fees are
assessed by cities to pay for new roads, parks, and sewer lines.
    
According to Duncan Associates, a Texas consulting firm that tracks them,
impact fees can add an average of $10,500 to the cost of a new home in cities
where they are imposed.  Of course, many cities have substantially smaller fees.
      
Property rights advocates are against the fees, saying local governments are
just afraid to go to taxpayers to ask for more money.  But proponents say the
taxes are fair because they are targeted at the very people who are causing
an impact on the city services: builders of new houses.

In any case, these fees are rarely assessed on the sale of an existing property
though the fees could raise the price of a property.
       
This is something to consider when pondering whether to build or buy.  You can
easily check to see if a locality assesses impact fees by checking with the city
building permits department.
       
If you have a question you want to ask, email me at info@miltonyates.com.

I will be glad to help.

Blessings to Your Real Estate Investing Successes,

Milton B. Yates
www.miltonyates.com

The Tax Advantages of Owning

Whether you own a mansion or a mobile home, many home-related expenses are tax deductible.

Mortgage interest and property tax are well-known deductions. To take advantage of them, you have to file the 1040 long form and Schedule A. For some homeowners, however, it might be better to file the EZ form because standard deductions would be greater than the allowable expenses.

The interest on a home equity loan is fully tax deductible unless the balance on the original mortgage plus the equity loan is greater than the property's value. After that, it's on a sliding scale.

If you bought a home after Jan. 1, 2007, mortgage insurance is fully tax deductible if your income is $100,000 or less.

Mortgage interest and property taxes on a vacation home are deductible. But it doesn't even have to be a house. It could be an RV as long as it has cooking, sleeping, and bathroom facilities.

If you paid points to get a better interest rate on any of your home loans, you can deduct the points in the year you paid them. If you refinance the home, points are deducted over the life of the mortgage.

If you changed jobs and had to move more than 50 miles and had to sell a home because of the move, moving expenses are deductible unless reimbursed by an employer.

When your home has been damaged by a natural disaster such as fire, hurricane, or flood, some of the bills for renovating the property that were not covered by insurance can be deducted. Check with your tax preparer for more information.

Do you have a home office used on a regular basis for business? Keep records on the percentage of the house that is used for business and make a proper allocation of expenses. For example, if 20 percent of your house is used for business, you will be able to deduct 20 percent of utilities and basic home repairs.

Keep records that show what you do in your office to constitute a business activity.

Blessings to Your Real Estate Investing Successes,

Milton B. Yates

www.miltonyates.com

This is a Great Time to Buy a Retirement Home

Here's one facet of the real estate market you can be pretty certain of. Ten years from now, prices will be far higher than they are today.

That's particularly true of properties with spectacular views. But whether you are looking for a cottage in the mountains or a house on the beach, the place doesn't have to generate the same rate of return you demand for other investments. You are buying a lifestyle.

That situation has put people in their 40s, 50s and 60s into the market. While sales of primary residences fell last year, vacation home sales rose nearly 5 percent, says the National Association of Realtors. The typical buyer of a vacation or retirement home was 44 years old.

There's no question that second homes come with expenses, so you have to ask yourself if you can afford one. Don't rush into buying. If money is tight, however, you could consider buying now and collecting years of rent to defray your costs. For the first time in years, higher rents mean they will cover, or almost cover, the costs of mortgage, taxes, insurance, and maintenance.

The benefits of a vacation/retirement home are many. The transition from work to retirement is eased because over time you have met people and become part of the community.

Buying while you still have children at home is a plus. They look forward to being at the vacation place. As they grow up and change jobs and cities, it will always be a gathering place. It will be a place to come for a vacation and for Christmas or Thanksgiving.

In today's market, many sellers are eager to make a deal.

Blessings to Your Real Estate Investing Successes,

Milton B. Yates
www.miltonyates.com

Skip PayDay Loans...Credit Unions or Personal Loan Companies

Want an instant loan from a company that won't even bother with a credit check? A payday loan could help for now, but it will be very expensive, especially if you renew it several times.

Payday lenders have you write a check for the loan plus their fee. The loan usually lasts up to 14 days. Then you either repay it with cash or let the lender cash your check.

The fee is usually $15 or $20 per $100 borrowed. The fee is $30 if you borrow online. Annual interest rates can be to up to 500 percent.

If you are short on payday and you renew the loan, you multiply the interest. Letting a $300 loan ride for a year can cost $2,340 in interest, and you would still owe the $300.

Lender personnel often encourage people to borrow more than they need because they want to earn bonuses. There are other ways to get cash, such as borrowing from relatives. If that isn't an option, many credit unions have short-term loans with lower interest rates and convenient payment plans.

In the 12 states that don't allow payday loans, consumer finance companies offer short-term loans, as do many finance companies in other states.

A credit union is the best choice according to the Center For Responsible Lending. The interest rate is more favorable, and arrangements can be made to deduct payments over time from your savings or checking account.

A recent federal law caps interest on payday loans to military families at 36 percent.

Blessings to Your Real Estate Investment Riches,

Milton B. Yates
www.miltonyates.com

When You're Late Again, Ask Yourself Why!!!

If you often find yourself rushing to an appointment, and not getting there on time, you could be a victim of misconceptions and miscalculations.

Optimism is good, but not when determining how long it will take to drive through traffic and park your car. You have to allow a safety margin to account for unforeseen delays.

Most chronically late people consistently underestimate needed time by 25 percent to 30 percent, says Diana DeLonzor, author of Never be Late Again (Post Madison).

At the University of California Haskayne School of Business, researcher Piers Steel says one cause is that people don't get motivated far enough ahead of their deadlines. Steel is the author of an article called "The Nature of Procrastination."

Psychologists once thought the tardy were late because of avoidance and anxiety. That proved not to be true because the same people were late arriving at events they enjoyed.

Tardiness is contagious. When others know you will be late for a meeting, they will be late too, wasting time for those who were punctual. Late people are more likely to change punctual people than the other way around.

Some offenders say being late makes them feel important because everyone has to wait for them. Usually, however, they lose respect.

Tardy people have their reasons, but the price can be high.

Blessings to Your Real Estate Successes,

Milton B. Yates
www.miltonyates.com