What color is your lightbulb?

The color of light is measured and referred to as Kelvin. The new Lighting Facts on packaging label shows it as K.

Older incandescent bulbs colors are 2,700-3,000K, they are typically marked warm white or soft white.

For a whiter light, look for bulbs marked 3,500-4,100K, they are typically labeled cool white, natural or bright white.

For a bluer white light, look for bulbs marked 5,000-6,500K, typically labeled natural or daylight.

Dangerous Sunscreens

 

The Environmental Working Group’s Worst Sunscreen of 2013

by Vivian Gunnerengen, Interior Designer, ILD

It’s getting hotter and hotter and the sun is out in full force. Good parents and healthy adults protect their skin with an SPF product daily, (hopefully) thinking they are protecting thier bodies from harm.

I was alarmed to learn that a great number of our favorite sunscreens can do more harm than help but consumers don’t know to read the label. In fact, even more upsetting is that our FDA and retailers allow these products to be sold to the public. Ingredients like Parabens, Vitamin A, Oxybenzone are all known to contribute to adverse effects like cancer, tumors, hormone disruption, and allergies.

Here I am covering my kids in sunscreen not knowing what was in it with the best intentions possbile. When I found the Environmental Working Group’s research study I looked up the score for the sunscreens I had and knew I had to do better. I was using the spray which may even be illegal to sell in the future that’s how bad it is.

Before you hit the beach, the boat, or the campground this summer take 15 min to find a sunscreen that is not going to harm you or your loved ones. For the ladies they also have make-up reviews as it can be toxic too.

Read more and search sunscreens at this website: http://www.ewg.org/2013sunscreen/fda-fails-consumers/

Comment

Do you know what the sequestration is?

Much to the dismay of many Americans, $85 billion in sequester “cuts” began on March 2. “Sequestration” is the term that refers to automatic spending cuts across the board of federal agencies totaling $85 billion in 2013. This is a result of the Budget Control Act, signed by President Obama in August 2011, which also raised the debt ceiling. The sequester provision was a “placeholder” for Congress to take action on a long-term plan for deficit reduction or face automatic cuts. Unfortunately, Congress was unable to compromise on a plan, thus sequestration went into effect.

Although no one truly knows the extent to which the sequestration will impact American citizens, we can anticipate how it will unfold this year. In early to mid-March it is expected that many federal agencies will begin to furlough employees due to budget shortfalls. On March 27 there could potentially be a partial government shutdown if an agreement still isn’t reached. If a government shutdown occurs furloughs may begin in April. All cuts have to be accounted for by Sept. 30 when the federal budget year comes to an end. And Oct. 1 begins the next federal budget year when more sequestration cuts will take shape. According to the Wall Street Journal, the Department of Defense will take the biggest hit at $42.7 billio

Fiscal Cliff and Commercial Realestate

DEAL REACHED ON JANUARY 1, 2013: SEE UPDATE BELOW

The fiscal cliff has been dominating media outlets since the presidential election. The term “fiscal cliff” refers to expiring Bush-era tax cuts, the payroll tax, Alternative Minimum Tax (AMT), Medicare payments to doctors. These expiring provisions, along with the sequestration (cuts to federal agency budgets) that takes effect Jan. 1, 2013, could cause significant problems for the economy and may push the U.S. economy over the “cliff,” resulting in serious fiscal issues felt across the nation.

Current law, stemming from the debt ceiling negotiations of spring 2011, states that if lawmakers do not find a solution to reduce the deficit by $1.2 trillion over the next decade, automatic spending cuts for the federal government would begin. The spending cuts include $64 billion in defense and nondefense programs, as well as a $330 billion tax increase (expiration of ” Bush Tax Cuts”). Each fiscal threat is important, but the expiring Bush-era tax cuts are the most relevant to the commercial real estate industry.
1. Go off the Cliff: Congress does not act by the January 1, 2013 deadline and allows the tax cuts to expire, raising taxes to pre-Bush levels, and cutting government program spending across the board. This could cause consumer spending to shrink, massive job losses, and create instability on Wall Street. This scenario would also create new pressure on the Republican leadership to drop their hard-line approach on voting for tax increases and instead work across the aisle to create different tax systems. This also allows lawmakers to avoid any political repercussions for increasing taxes while reducing the deficit.
2.Postpone Action: Congress could drag their feet and buy more time. There is potential for legislation that would delay the impending tax hikes and cuts to move forward, thus putting off the looming fiscal crisis by a year or so. This would reduce panic on Wall Street and allow for more substantive policy negotiations to take place. This may sound appealing, but it simply delays the problem and further creates more uncertainty for businesses. It also puts President Obama in a difficult position, in that he made a campaign promise to end the Bush-era tax cuts by Jan. 1, 2013, for America’s wealthiest citizens.
3.Make a Deal: Republicans and Democrats work frantically to create a long-term deal. This would require enormous compromise and discussion from both Speaker Boehner and President Obama. This deal would have to address both tax cuts and tax increases in the lame-duck session, which would be a significant task in such a short period of time. House Republicans have passed H.R. 8, whereas Senate Democrats have passed S.3412. These bills tackle the fiscal cliff in very different ways and would require significant negotiations on both sides. President Obama supports the Senate version.
UPDATE: As of November 30, no substantial movement has occurred to avoid falling off the fiscal cliff. President Obama has proposed a $1.6 trillion tax increase (for couples making over $250,000 or individuals making over $200,000), $50 billion infrastructure plan, and a new plan to raise the federal debt limit. Republicans in the U.S. House have rejected the plan saying it is not a balanced approach.

UPDATE: On December 3, U.S. House Republicans have put forth a plan to avoid the fiscal cliff. The GOP plan includes a $2.2 trillion cut from the deficit through spending cuts, entitlement reforms, and tax revenue. This plan was rejected by President Obama because it does not include a tax increase on wealthy Americans.

UPDATE: Fiscal cliff discussions continue on Capitol Hill this week as the January 1 deadline looms. Although there are no substantive or concrete plans being revealed, the potential for an agreement remains hopeful. On Monday, December 10, Michael Steel, Speaker Boehner’s spokesman, could not release details of the talks. He did hint that the Republican Party continues to stand firm on the GOP offer made last week. The White House has hardened its stance on raising the debt ceiling, further complicating the discussions. Steel also said that lines of communication between the White House and Boehner remain open. Currently the two greatest obstacles to avoid falling off the fiscal cliff are tax increases on the wealthy and cuts to entitlement programs.

UPDATE: On Friday December 14 Speaker Boehner offered to increase taxes on incomes over $1 million and extend the debt limit for one year. President Obama offered to lower tax revenue from $1.6 trillion to $1.4 trillion over 10 years Final negotiations are pending but this is a sign that concessions will be made on both sides of the fiscal cliff debate.

UPDATE: On January 1, 2013 Congress prevented the U.S. economy from going off the fiscal cliff. President Obama signed H.R. 8 into law January 2.

Debt ceiling and real estate

Earlier this week, President Obama announced he would not be open to negotiating the debt ceiling and would move forward with raising the limit. The national debt ceiling will be reached shortly, which may lead to the United States defaulting on its debt and potentially send U.S. and world markets into a tailspin. During a White House news conference, President Obama stated he would not cut government spending in exchange for the GOP’s vote to raise the debt ceiling. Republicans have stated that in order for them to agree to a debt ceiling increase, the White House would need to implement more spending cuts.

There has been chatter on Capitol Hill of President Obama using his executive powers to circumvent Congress to increase the debt ceiling. House Republicans are scheduled to gather for a retreat on Jan. 17 – 18 in Virginia to discuss the debt ceiling situation.

The real estate sector would particularly suffer from the potential default of U.S. debts if the debt ceiling is not raised. The 2007 subprime mortgage disaster resulted in a near shutdown of the commercial mortgage backed securities market, including interest rate fluctuation, liquidity issues, and several other market crises that are still felt today.

Congress last raised the national debt ceiling in Aug. 2011.

UPDATE: Movement to increase the debt ceiling occurred in the U.S. House of Representatives. House members approved the “No Budget, No Pay Act” on January 23. This is a short term solution with a debt ceiling extension until May 18. This extension allows Congress and the President to haggle over spending cuts and entitlement programs. Lawmakers raised the stakes in this bill by adding the “No Pay” section for members of Congress if they are unable to pass a concurrent resolution on the budget and appropriations.

UPDATE: The debt ceiling bill was approved by the Senate on January 31. To finalize the “No Budget, No Pay Act” President Obama will need to sign the bill into law. The Senate bill is consistent with the House bill that was passed on January 23. Sequestration or automatic spending cuts for all federal government programs remain the greatest obstacle to formulating a compromise by May 18.

Think twice before adding children’s names to title

From a tax and equity perspective, it’s not a good idea.

BY BENNY KASS, WEDNESDAY, DECEMBER 26, 2012. |  Inman News®

House wrapped in bowDEAR BENNY: My wife and I are in our mid-50s. We have a 30-year-old daughter who owned a house years ago and now resides in an apartment. Our son is 21 and also lives in an apartment. We want to put our home in which we have lived for 15 years in the kids’ names. We have approximately three years left on the mortgage.

Our questions: (1) Would they also go on the mortgage or just the deed? (2) If our son is on the mortgage or the deed, will this jeopardize his opportunity to qualify as a first-time homebuyer? (3) How do we go about this process? Attorney? Realtor? Mortgage company? (4) Would this make it difficult to get a home equity loan by me or my wife? –Jack

DEAR JACK: Let me start by saying at the outset that I do not believe putting your kids on title is a good idea. There are potential tax complications, especially since as I write this column there is complete uncertainty as to what the tax situation will be starting in January 2013.

There are a number of reasons why I oppose your plan. First and foremost, while you trust your children, you have to take care of yourself first. I don’t know your financial situation, but you don’t want to end up 10 or 15 years from now without a house and with little or no income for retirement.

I am not sure whether you want to give the entire house to your two children or just add their names to the title with you. But either way, this will significantly diminish your opportunity to pull out the equity you have in your house if and when you need it down the road. For example, while I am a reluctant advocate of reverse mortgages, you may find that you want to take advantage of this kind of loan after you turn 62, but your plan will prohibit this.

From a tax point of view, it is also not a good idea. If you give property to your children, your tax basis becomes theirs. For example, if you bought the house years ago for $50,000 and made no improvements, your tax basis is $50,000. If you give the house to your children, their basis is the same. However, if the house is now worth $500,000, and your children sell without living in the property for at least two years, they will have to pay capital gains tax on the profit. Currently, the federal tax rate is 15 percent, plus any applicable state and local tax. And there is talk that the rate may go up to 20 percent in 2013.

But, if you leave the house to your children in your last will and testament, on the death of both you and your wife, your children will take advantage of what is known as the “stepped up” basis.

Let’s give this example: You and your wife bought the property for $50,000 and for this discussion I will ignore any improvements. The tax basis for both you and your wife is $25,000 each. You have died and now your wife dies when the property is worth $500,000. The tax basis for your two children who will inherit the house is $500,000. If they sell it for that amount, they will have no gain, and no tax to pay.

Here’s a suggestion: Somehow pay off the mortgage if you can, and sell the house to your two children at fair market value, less the cost of a real estate commission. You take back 100 percent financing. You rent the house from your kids and you pay them monthly rent and in exchange they pay you a monthly mortgage. You can adjust the length of the mortgage loan so that the rent will equal the mortgage payment.

Since you have owned and lived in the house for two out of the five years before you sell it, and you and your wife file a joint tax return, you can exclude up to $500,000 of any gain. So, in most cases, you will not have to pay any capital gains tax.

If you still want to pursue your plan, you need a real estate attorney who also understands tax issues. You do not need a real estate agent.


DEAR BENNY: My wife and I sold our home in New Jersey and moved to Melbourne, Fla., to start the last third of our lives. We looked at more than 80 homes for sale, including foreclosures, short sales, and actual homes being sold by real people.

Most of the homes were in such bad condition that it was discouraging to go out every day and look for our dream home. We finally decided that we needed to buy new to get what we were looking for. So we bought a new home, and that is when the trouble started.

The builder’s policy is for the buyer to take out a construction loan. That is, you close on your home before it is built, and when the construction of your home is completed you then modify the loan to make it permanent. The builder reimburses you the interest on the loan for the time of construction.

We then looked for a bank to handle the mortgage. We chose X bank because its loan officer was upfront and explained to us, to the best of his ability, all the charges that we were going to have. In other words, he took his time with us.

So here is my question: The house was appraised for the full value that the builder was selling it for, and was built in five months. When we were told to modify the loan, we were ready to move forward. Then something we were not told in the beginning was that the bank had the right to reappraise the house at my cost of a second appraisal. The house was appraised for $20,000 less than what it sold for five months earlier. We told this to the builder who said don’t worry, because the first appraisal is good for six months. The builder even went to the bank to look into this for me, and it was told to butt out.

In the contract it does state that the lender has the right to order a second appraisal. I would think something like this should have been brought to my attention in the beginning. This bank is the only bank so far to ask for a second appraisal of the five banks we could have gone to. So much for honesty and integrity.

The builder has not lowered its price of the same house as of the date of this letter. The builder’s only option is to stop recommending this bank to new-home buyers. Do I have any options? By contract I have to modify within 30 days of completion to maintain the locked-in interest rate. –Byron

DEAR BYRON: I understand that you are upset because the bank required a second appraisal, and it came in lower than the original one just five months earlier. But you have admitted that the contract does state that the bank has that right. So, with all respect, I am not entirely sympathetic to your situation. You knew — or should have known — about the possibility of that second appraisal. You could have tried to negotiate with a bank to accept the first appraisal, so long as no more than X months elapse between the original loan and the permanent loan.

However, are you completely ignoring the builder? His marketing plan, while not unique, is not common. Basically, he built your house at no cost to him; he was using the construction loan money instead of his own funds. He did, however, agree to reimburse you for the interest you paid on the construction loan. I assume you are still paying interest on that loan, so why not demand that he reimburse you for the interest you paid to date and start paying the future interest as well as assist you in getting a new loan?

A word of advice to my readers: Read all documents before you sign, and if you have questions, don’t be afraid to ask. And if you don’t understand what you are signing, ask an attorney for guidance.

 

Green Mortgages

An Energy Efficient Mortgage (EEM) is a mortgage that credits a home’s energy efficiency in the mortgage itself. EEMs give borrowers the opportunity to finance cost-effective, energy-saving measures as part of a single mortgage and stretch debt-to-income qualifying ratios on loans thereby allowing borrowers to qualify for a larger loan amount and a better, more energy-efficient home.

Energy Efficient Mortgages : ENERGY STAR