Friday, May 25, 2018

The Long Weekend Has Begun

Hello dear friends.  It's Friday afternoon here and the weekend has started with a boom!  The pool replaster guys arrived with their jackhammers and have begun attacking the pool.

In August, we will have lived in this home for eight years.  It's the first home we've ever had with a pool and hopefully the last.  It's basically a hole in the ground that takes a lot of money and upkeep.  We are "do it yourself" people but this time, we had to hire a proper company to replaster the pool.  You can see the total discoloration and erroding of the plaster.

The plaster team arrived just a little bit ago, all five of them with their air driven jackhammers and they are getting the job done of taking off the old plaster.  Unfortunately, the whole pool system of heater and filter are over 25 years old, so we're having that system replaced too.  This is for a couple (myself and husband), who maybe get into this pool twice a year.  It reminds me of the boat we once owned.  Luckily, we sold that boat.  The pool I'm afraid is here to stay :)

I had a lovely week as my daughter took me to tea.  It was part of my Mother's Day gift.  I didn't tell you but my dear husband was in the hospital over Mother's Day.  He's fine now - long story short he had been prescribed too many doses of antibiotics and it effected his system.  Thank goodness for great medical care.  He is fully recovered.  It was scary.

My daughter and I enjoyed a lovely tea at the Tea House in an old house in San Juan Capistrano.  We've gone there before and my it was a busy place that day.  

On Saturday, I attended my Daughters of Norway lodge meeting.  It was held at the Women's Club House in Dana Point.  I love going to this club house as it's so old school from many, many years ago.  Our dear member, Myrna, wore her Mother's bunad that was made by her family in Norway back in the 1960's.  It's all hand embroidered; such fine detail, too.  I loved the jacket that she also has as part of the ensemble.  Myrna will be wearing this lovely bunad to the Grand Lodge Convention later this summer.

On Sunday, I hosted a dinner for some dear friends.  We had a good time and my husband bar-b-qued steaks but the bar-b-que decided not to cooperate.  No fear, as we finished them in the broiler.  It was a nice evening.

I'm still working on finishing my knitted scarf but in the meantime I started this little needlepoint.  I'm so late in coming to discover this wonderful needle art.  I absolutely love needlepoint!  However, the canvases can be quite pricey.  So far, I've bought them on eBay and have had great luck.   This is just a smaller one that I'm making from leftover tapestry wool.  I changed up the colors a bit as I don't like bright colors.
I found this canvas design on eBay through two different sellers.  It's a very large canvas and when I decided to purchase it, it was gone.  Luckily, after looking on the web, I found the exact same canvas at which is a Turkish website of all things.  It is 60 cm x 125 cm.

And I also bought this little canvas as I love the oval design.  In addition to the two shown above, I bought one more for my daughter.  And, guess what I paid for all three?  $61.00!  It was a steal.  Here's the catch; Goblen offers free shipping in Turkey so I had them shipped to my son's home there.  But, if I were to have them shipped to the US via DHL, is would have been $24.00 shipping.  It is still a great deal as the large swan canvas above was $99.00 on eBay.

The company offers all types of needlework products.  I didn't buy the tapestry wool as I wanted to see if I had some of the colors in my stash.  As it turned out, I was in need of some black tapestry wool and I hate to pay shipping charges.  I found DMC Laine Colbert tapestry wool online at WalMart and had it shipped to my local WalMart store for free where I picked it up. It's quite puzzling to me why WalMart would carry such an item such as French tapestry wool?  

Anyway, that's the update from Lilly My Cat.  Lilly is as sweet and sassy as ever and she sends you all her meows and good wishes for a safe Memorial Day holiday!

With my best wishes,


PS - I hope I didn't bore you with my last two blog posts about investments and buying a home.  I just have a real passion about these things and if I can ever help someone in some way then that's a good thing!

Tuesday, May 22, 2018

Don't Give Up on Buying a Home

Wow, my last post was so popular I'm back again with another!  (Not really, it bombed but that's OK as it's out there in blogland for someone who might be enlightened).

Really guys, I want to tell you about something that is now and present.  Buying a home.  You'll say,"we can't buy a home because we don't qualify for a loan".  I totally understand that.  But, there's always another way.

If you've read my blog, you'll know that I've invested in real estate for many, many years.  Throughout those years, many times I've sold a piece of real estate to a buyer through a real estate contract.  Here's what happens.  When you want to buy a home, you go to a bank or mortgage lender and apply for a loan.  If you get approved, that bank or lender will give the money to the seller of the property and then you will pay back the lender at a set interest rate over a period of usually 30 years.  OK....but you don't qualify for a loan.  No worries, you just need to find a property where the seller will be your lender or your bank so to speak.

Here's the real life scenario that happened just two years ago.  Years earlier, I had invested in some property in an area of California when the prices had dropped.  I secured an excellent tenant for one of the homes and he paid on time as agreed.  Less than three years ago, I decided to sell my real estate holdings in this area.  I asked my tenant if he was interested in buying the home he was renting.  He said "yes, but I don't have money for a down payment and I don't qualify for a loan".  I told him no worries as I would be the banker for him.  The following took place:

1.  We agreed on a purchase price and interest rate with a thirty year amortization.
2.  A preliminary title report was ordered as the buyer needs to confirm that the property he is purchasing is free of all encumbrances. (The seller owns the property free and clear).
3.  Our local title/escrow company drew up the legal documents which included a Real Estate Contract, Promissory Note and the Deed of Trust, held by safekeeping with the escrow company.
4.  There are closing costs involved in purchasing/selling real estate.  The buyer's closing costs were around $2,000 and I did not take any down payment on the sale.
5.  The legal documents were signed and recorded with the county.

In a nutshell, my tenant became the homeowner for less than $2,000!  He pays me on a monthly basis, and his monthly payment includes principal and interest on the loan, along with taxes and insurance.  The local escrow/title company services this loan for both the seller/buyer at a small monthly fee.

YOU can be a homeowner.  You just need to find someone out there who is willing to sell you the property on a real estate contract.  That seller is basically going to by your lender.  It's good for the seller too if he doesn't want to sell, get all the cash in hand and pay out a large portion to the IRS for his share of taxes.  This way, as the money comes in, his taxes to the IRS on the sale of this property are proportional.

Don't give up can also LEASE TO BUY.  I have an investment property now that I am negotiating this scenario.  You agree to lease the property at X amount of dollars for a term of X months/years.  A portion of that rent can be credited back to you if you decide to exercise the option to buy.  Again, it should all be in the contract you draw up with the seller.

Now my tenant is a homeowner.  He and his family are thrilled to be able to own a home in which they show pride and take extremely good care of the property.  Already, his home has increased in value and if he were to sell today, he could walk away with a profit of approximately $50K.  Not a bad deal after all.

What I want to say is that if there's a will there's a way.  It doesn't matter where you live in this world, don't resign yourself to thinking "no, it won't work".  You don't know until you try.

I hope this can help someone out there in this huge world.  And, I'd love to hear your feedback.  If you have questions, I'll be sure and try and answer them.

Sending you my best wishes,


Thursday, May 17, 2018

Planning for the Future

Sometimes I wonder why I didn't name my blog differently because it's about so much more than my cat Lilly...

As many of you, I enjoy reading different blogs.  Many times I get creative ideas than I can use. Other times after reading a blog, I'm left puzzled.  Everyone is entitled to his or her ideas as that's what makes it so great.  But, there's always more than one way to accomplish something. 

Case in point, there's a few blogs out there whose premise is to "give people fish instead of teaching them to fish".  We're talking about money here.  A very touchy subject indeed but a very important subject the older you get.

I really wanted to direct this post today to the younger generation; those in their 20's or 30's or even 40's.  It's not too late to start on your path to financial independence.  After I got married, my husband had this idea to be financially independent.  Yes, it was a much different time back then, but we were young and lived in a small agricultural town.  Much of the town had not been developed and we started on our quest with real estate.  Rentals to be exact.

Now, I know a lot of you will immediately say, "we've had rentals and they were a disaster".  Yes, I can totally understand.  But, there is a way to not have a disaster.  It's all about location and screening your potential renters.

We were like any other working couple back then.  We had purchased our first home and two years later we decided to build a home on some property we had bought.  So, we rented the first home. A couple of years later, we sold it for double than what we had paid for it.  We then bought a large parcel of undeveloped land and gradually build multifamily rental units on it.  Little by little, we continued along this path.  We had success during this time because the small community we lived in needed housing and land prices were cheap at that time.

We lived in this community for 22 years before we decided to move across the state to the "big city".  After being in the big city atmosphere a couple of years, we sold all our real estate in our small town.  And, we reinvested this money into new properties in the big city we lived in.

Currently, we've been living in California for almost 8 years now and we just now sold our last property in Washington.  For the past three years, we have been selling off our Washington property and reinvesting in California property.

What I'm trying to say is that real estate can be an extremely good investment in the long term.  It's been good to us as the rental income has always attributed to our monthly income.  But, this is not a "get rich fast" scheme.  It takes years and years to reap the benefits.  Which means, if you start now, chances are you will have a nice little nest egg when and if you decide to retire.

Here's some things to remember:
Location:  It doesn't matter whether you live in a small town or big city, location is the number one factor as to what kind of renters you will attract.  Good location and nice property makes it much easier to get excellent renters.
Monthly Rent: There's a lot of landlords out there that want to bleed their renters by increasing the rent at every chance. Weve never been that way. We invested in nice property and have excellent renters. Hence, it's very seldom that we increase the monthly rent. We only increase the rent when necessary to offset the increase in fees that we may experience.
Money for Rainy Day: It doesn't matter what type of rental property you have, you have to have a little money put back in case of disaster. It can be anything from repairing an applicance to putting on a new roof.  It's imperative that you have money on hand to keep your rental in top condition.  You owe it to your renters to keep it in order.
Mortgage: You always need to think about the worst case scenario, what is your exposure.  Please do not get an adjustable rate mortgage.  You can't see the future and it could cause you huge problems if the interest rate suddenly increases.  Be safe in your investments.
Home Equity Loan: If you think the real estate market is hot and you want to jump in and buy, please don't take out a home equity loan.  Again, you can have a disaster; especially if the property you buy drops in value.  Then you are in the negative. Be cautious.
Stepping Stones: Looking back over these past 40 years, I think real estate worked for us as it was a stepping stone.  We kept our properties and sold them years later at a profit.  We invested those monies into new properties.  We started out with our first home which we paid $17,000.  I know, that's not possible today.  But, there are some deals still out there.
Negotiate: I live in one of the most over priced real estate markets right now.  At the same time, it's a hot market because of the location.  But, there are still some bargains out there.  Many buyers are wanting to get out of their mortgage and are willing to negotiate.  They can be desperate in that they don't want the property to go into foreclosure. Look for these deals as you can save a lot of money.  Believe me, as my husband and I just purchased one of these properties.
- Screening: Today potential renters complete a rental application whereby the landlord can review and order a credit report on the applicant.  This is very critical; believe me, many times we could have been taken for without getting the credit report.  It's imperative.  And, there are online agencies that you can sign up for to take care of this for you. 

Yesterday, we met with the painter for the property we're buying.  Up until the last few years, I use to paint all the rentals myself.  I enjoy painting and it saved a lot of money.  We managed our own property too as we like to keep a tight ship and control our rental units.  I think this helped us very much.  Now, we have a wonderful real estate professional who takes care of many things for us. At the same time, the final decision making is always left to us.  

What I'm trying to say is we don't know what the future is going to hold.  When my husband lost his job when the sugar company closed many years ago, he was vested but lost his retirement. It was a bad situation. We said never again will we let that happen and we started on our real estate adventure.  Yes, my husband easily obtained another job that he kept for almost 40 years. But, we had our safety net of our real estate which we were in control of ourselves.

Also, please don't forgot about other investment instruments that can add to your retirement such as IRA's, 401k's, and whole life insurance.  It can be a hardship to save when you are young, but believe me, as you get older, you will be so thankful that you've taken this path.  And, for those of you who are young, you can't depend upon Social Security as it may not be around.

My advice  is to look into investing; safe investing that can grow over time and don't be talked into get rich fast. Do your homework and be informed whether you are buying real estate or an investment instrument.  It's your money and you don't want to make a poor investment.  Better to be cautious and not worry.

I hope my rambling on today can help someone out there in blogland.  Thank you dear readers for stopping by today.

With my best wishes,