What do you mean "she found out her purchase 2 years of dues were owed."? You mean she just now bought the house and she found out that two years are unpaid so they're hitting her up for it?? No fair. I'm president of our HOA, and I can tell you putting a lien on a house is the very LAST thing we would do, after lots of begging and correspondence, including a threatening letter from our atty. And we do not make a new buyer pay what the old home/lot owner owed us. However, we also do not have the HOA dues on buyers' closing statements, nor is a realtor, atty, title agency, seller, or builder required to tell a buyer about the HOA. We have tried and tried to remedy this situation, but the fact is, that in our state, it is the buyer's responsibility to find out what the covenants are. These are on file at our city courthouse, but most potential buyers get them from their realtor. Perhaps you can encourage your friend to sit down and have a neighborly chat with the HOA Pres. or Treasurer and work something out. I think you aren't getting the entire story. Also, your neighbor needs her own copy of the covenants to see exactly where she stands legally. She might also check to be sure her HOA is registered with the state and are paying their dues. Have her ask the HOA if ANY dues have ever been paid on this lot and why SHE has to pay the two years rather than the builder himself. If there is nothing to that effect in the covenants she may have a case. In our HOA, it's the builder who is required to pay the dues until the house is sold.

Hi Loralee, There are worthy realtors who'll be around soon, so I'll leave the agent questions to them. In the meanwhile, as an investments lender as well as an income real estate portfolio owner myself, I'll cover the top 3 questions; - Is it a good idea to incorporate a business for this activity to protect our personal assets in the event of any kind of tenant lawsuit? It depends. There are costs to create and maintain a corporation, and its prudent to weigh out & compare these costs versus alternative protective means. For a first-time investor (especially if your vulnerable net worth is still modest,) a good umbrella insurance policy will often suffice just fine. Insurance does also have its limitations though (including not addressing tax planning or cashflow management and defense...) so as you grow your vulnerable net worth, the incremental costs of a business entity (corporations, trusts, limited partnerships, and the like) begin making more and more sense. - If we subbed the management service to a professional management service, generally what kind of fee would we be looking at? For individual single family home rentals, management fees are generally; A) 1st month's rent from the new tenant, plus, B) 10% of the ongoing gross rental revenues. Usually this will get you the services of; Marketing & screening for new tenants, Collection, bookkeeping, and deposits to your account of monthly rents, Periodic maintenance inspections, Notification to you of physically viewable problems, late payments, defaults, Management of service providers for repairs, or cleaning/turnovers between tenants. (Of course, more or less may be offered in competitive environments.) - What kind of rental profit % should there be after mortgage, taxes, insurance, repairs. (I would like to know so I can compare current rentals in the area to see if we could offer comparable in order to know if this is feasible.) What kind of profit SHOULD there be??? Sweetheart, the answer is always; "AS MUCH AS YOU CAN POSSIBLY COLLECT!!!!" ;~) In reality, in most North American real estate markets, the rental revenue markets have not increased enough in the past 10-15 years to keep up with the crazy property appreciation prices that were driven by the easy credit available. The collapse of the credit markets has BEGUN to reverse this (with property flat to dropping, but rents beginning to awaken & grow again,) however its still going to take a while to really make sense on an easy basis. Most single family homes "bought at retail" cannot be fully supported by the local rental rates available, and most landlords of such homes need to accumulate a significant amount of equity in the home (or said inversely; need to reduce the loan balance to reduce the interest costs) enough so that the net real rental revenues are more than the out of pocket cash costs of ownership (i.e. "positive cashflows.") Prudent investors, however, donot consider a property TRULY cashflow positive unless its rental revenues are more than not just the interest paid for the loans... but ALSO the interest NOT EARNED (or lost) from the cash value of the equity that is trapped in the real estate itself (since, if that real estate were sold, the equity value could be earning interest elsewhere... and thus is a real cost, albeit merely 'on the books.') GENERALLY SPEAKING; anytime you can acquire a rental property in a market where the rents are climbing, and you can hope to have real rental revenues grow to be more than your total real costs of ownerhip (including equity value opportunity loss) within 2-3 years... you are doing very well. Hope this is helpful. Dave Donhoff Leverage Planner

I'm a teacher too, and I can give you some advice on some of these topics. I am 100% sure we're not in the same state because you make more money than I do (though I have 24 years experience). - First, you sound like you're doing very well for your age. You should pat yourself on the back for realizing the importance of saving and thinking about retirement well before most people your age. - I'll second the point about talking to your potential fiancée about finances ahead of time. Do not just assume it'll all work out. - Buying a house is a sound investment. I assume you'll sell your current paid-for house, so you'll have about 120K to put down on a new one -- excellent. Even if she brings little to the table for this project, the two of you should be able to knock out the borrowed 100K within five years (even if you have a baby soon). With no mortgage, you'll be amazed at how much easier it is to live comfortably and still save! - Do you have a savings account for a new car? Since yours is paid for, I suggest you begin paying a car payment into a savings account. Once you get yourself "a car ahead" (meaning that you're ready to buy a new car when you need it, so that you're not wasting money on interest), it's easy to STAY "a car ahead". - I have the impression she's a teacher too? If the two of you work at the same school, consider becoming a one-car family. We did it for several years (until I started teaching, and our schedules were completely incompatible), and it was a MONUMENTAL money saver for us. It was the single biggest thing that allowed us to get off to a good financial start in our 20s. - If you hate your job (I do at times, really, I do) but want to stay in the pension system, could you do something else within the school system? Could you be the tech guy? the athletic director? could you do something different as a state employee -- a possibility, if your pension systems are linked? - I don't think you need to think about life insurance at this moment. Not to be crass, but if you died today, would anyone be worse off financially? With no wife or children, probably not. Once you're married, you probably won't need it yet. If you were to die, your wife could use your pension pay-out and your other investments to pay off the modest house payment you anticipate taking out, and she'd still have her job to sustain her. You WILL need life insurance once you have a child. If you were to die and leave your wife with a toddler, she'd have years ahead of her in which she'd be a single parent, and although her salary would be enough to put food on the table and clothes on their backs, your life insurance would be there to educate the child in the future. The life insurance would also assure you that your wife would be able to take some time off work, and that she'd be able to put aside a good chunk for retirement. Remember, she too will need life insurance. If she left you with the toddler, you'd need the same help. - The two of you probably need disability insurance more than you need life insurance. Statistically, you are more likely to be disabled than to die young. And becoming disabled is the real nightmare scenario (from a financial standpoint). Consider: You're in an accident or you become sick. You cannot work, so your household income's slashed in half. Yet your medical bills are sky-high. Your wife is still working, but she's also doing ALL the housework and ALL the childcare AND is trying to help you with your physical therapy. She's burning through her sick days taking you to the doctor. THIS is the nightmare scenario: She's overworked, AND she can't take advantage of your life insurance. Avoid it by signing on for disability insurance. - Another thing you should do after you marry is to write wills. As a teacher, you probably have access to your an employee's credit union? They probably offer such services for a low price. - About your pension: Do you know the details for the pension in your state? In my state you're fully vested at 10 years (so, yeah, you'd be a fool to leave at 9.5 years), and you can collect a full pension at any age once you've put in 30 years. You can collect a reduced pension at 20 or 25 years, though the dollar amount is reduced, and you can't begin collecting until 65 (65?) if you don't put in the full 30 years. Once you find out the details for your own state, you can "run the numbers" and see when it makes sense for you to leave teaching. It might be sensible for you to aim for 20 years, then do something else -- but you have to get the facts, then do your homework. - How secure is your state's pension? This is public knowledge, so look into it. You do not want to put all your eggs into the "staying in teaching" basket, if your state's weak in the pension department. As the people in Detroit! - In my state the pension program (defined benefit program) is being exchanged for a defined contribution program. This has its pros and cons, but overall it means that the new, younger teachers aren't going to get a pension. Why does this matter to you? Because if you ever leave, then return to teaching, you'll come in under those new rules! - An above poster mentioned Social Security. In my state, teachers DO pay into SS, so I will collect an SS check one day. You seem rather financially savvy, so I assume you know whether you've been paying into this or not. - I disagree with the above poster who says you're essentially screwed if you choose to have children AND want to retire at a reasonable age. The key is that you have to choose to live FRUGALLY. My husband and I are 48 and 51, and we have two college students. When we married, we had between us $200, college degrees and jobs, one car, and a brand-new mortgage. We chose to be frugal from the very beginning: We maxed out our 401Ks, even though it meant we couldn't afford vacations. We built an emergency fund, then started a savings account, putting away 1/4 of our after-taxes paychecks, even thought it meant we rarely ate out or bought new clothes. When our savings account grew, we started investing, even though it meant we had to remain a one-car family. Today we live in a house that's paid for, have significant investments, and are easily able to pay for our two college students' expenses -- they will graduate debt-free. My same-aged friends who wail that they can't afford their kids' college tuition don't like to hear that we buy used clothing, drive an 8-year old car, etc. The key is knowing the difference between needs and wants -- and being self-disciplined enough to stick to a budget. - Finally, I think you're off to a good start. If you and your wife are both about 10 years into teaching, then 20 years from now the two of you can expect the following: 1. You'll be about 55 years old, and as a person who can "see 55 from where she's standing", it's not "old" -- at 48, my knees hurt sometimes, but I can still hike all day and can pretty much still do whatever I want. 2. You'll live in a house that's paid for. 3. You'll have two teacher pensions. 4. You'll have teacher health insurance in retirement. 5. You'll have two Social Security checks. 6. You'll have the investments you've already begun. 7. If you have a child soon after your marriage, that child will be finishing college (and beginning to support himself) about the time you retire. You'll be able to have all these benefits AND you can work part-time (or seasonally) so you can avoid dipping into your investments too early. Though you're not earning big bucks now (or ever), you'll be well prepared for retirement. If the two of you put in a total of 60 years of teaching to earn these benefits, you'll have WORKED for every penny, but you'll have a comfortable retirement.

If you cut off any limb but the very smallest only from the top there is a chance of the limb falling before the bark on the bottom has been cut through. Depending on the plant, this can result in the bark stripping in a line below the limb and down the trunk. To prevent this a shallow cut is made on the bottom half of the limb to sever the bark. This cut is made first, and then you go back and cut slightly further out from the top. Any stripping will stop at the first cut. The final cut close to the trunk (for a tree) is than made on the short branch stub left. The cut should be very close to the trunk bark, but not damage the 'collar' around the base of the former limb. The collar is where the bark will grow from to cover the wound.