Do you plan on doing any work in your house? Will you be using a contractor? If so, whether this is a small job or a major renovation, there are a number of steps you must take to protect yourself.

First, the contractor must be licensed in the jurisdiction where your property is located. When you have selected the contractor, insist on getting a copy of his or her license.  more...

DEAR BENNY: I would appreciate it if you would comment on the procedures for bidding on houses that are up for foreclosure. I suspect that one could get a decent deal, but I can't seem to crack the code on how to go about purchasing a house at a foreclosure auction. I realize that I have to show up with a cashier's check for the specified amount and make up the balance within 30 days, so I presume that I have to have all my anticipated financing in order. --R.B.

DEAR R.B.: I will answer each of your questions separately.  more...

Q: Our parents own their house free and clear, and it is worth about $400,000. Dad is 79 and Mom is 77; both are in fairly good health. They receive Social Security and a modest monthly pension. We would like to assist them financially. They both like to travel, but their limited resources deny them this pleasure. Do you have any suggestions?  more...

DEAR BENNY: I have an adjustable-rate mortgage (ARM) with one more year to go. When is the best time to refinance? Also, should I get an equity line of credit for household emergencies or home improvements? --Michael

DEAR MICHAEL: Your second question is easy. I strongly recommend that every homeowner who has some equity in his or her house get a HELOC, or home equity line of credit. Many banks will not charge any fees for setting this up.  more...

Q: Our grandmother is 90 years old and lives alone in her house. The property is free and clear of any mortgage, and is worth approximately $300,000. We believe Grandma is financially well-off.

However, a recent credit report indicates that she has a partner in a mortgage that to our knowledge she never took. This secret partner has been an "advisor" to her for some years. When we asked about this, our grandmother adamantly refused to discuss this, but reaffirmed her trust in the advisor.  more...

DEAR BENNY: I rent an apartment in California's Silicon Valley, where my job is. I can't afford a home here because prices average around $600,000. I believe I can afford to buy a house elsewhere while living here and paying rent. Is this a good idea, and can I still avoid PMI with a 20 percent down payment? --Todd

DEAR TODD: I do not think that's a good idea. I believe that consumers should first buy a home for their own personal use, and then consider becoming a landlord.  more...

Another phrase has been added to the real estate lexicon: "mortgage meltdown."

Many of us used to call some of the practices that led to the meltdown "predatory lending." But because most of the people who were preyed upon were poor, uneducated and often minorities, our national leaders largely ignored the problem. We kept hearing that no one really could define the concept of "predatory."  more...

DEAR BENNY: Recently, five out of seven of our neighbors in our cul-de-sac had their roofs replaced due to hail damage. The insurance companies involved verified hailstorms in the area. At our request, our insurance company sent someone to inspect our roof who confirmed that it also has hail damage. The problem is that we purchased our house after the hailstorms. Our homeowners insurance will not cover damage that occurred before the policy was in place. The inspector we hired to inspect our house before we purchased did not notice any roof damage.  more...

Q: We just bought a condominium unit in a new 50-unit complex. Although the developer will not tell us how many units have been sold, we have recently learned that it is starting to rent some of the unsold units.

This seems unfair, especially since our contract specifically states that we cannot rent for at least one year after settlement.

Can the developer rent those units?  more...

DEAR BENNY: I recently retired and am planning to move out of the country. I own a single-family house in a desirable area. I owe only about $70,000 on my current mortgage. The value of the house before the recent market crash was about $470,000. Despite the current market, numerous people have looked at the house, but only one has made an offer (a very lowball offer). I am not desperate to sell, but I want to move on with my retirement plans. The house is older, but has recently had about $30,000 in improvements in order to appeal to buyers.  more...

If you are considering a 1031 exchange (also known as a "Starker exchange"), you better make sure that you do it right. The Internal Revenue Service plans to increase its audits and its enforcement of these exchanges by the summer of 2008.

Usually, when a taxpayer sells a business or investment property, the taxpayer must pay a tax on any profit that is made. If the property was owned for more than one year, it will normally be considered a long-term capital gain and the tax will be based on your income. Currently, the highest tax rate is 15 percent.  more...