Question: As a first time new home buyer, my wife and I are interested in how you feel the mortgage debacle will impact buyers across the board.

We've seen the Fed take steps to help the banks and lenders, will there be a trickle down effect to interest rates for purchasers in the future?

The web and printed news is focusing on the mortgage side of things, but I've seen little or nothing that gives potential home buyers advice as to wait for a possible rate drop or jump in now before the loan money is "completely" gone.

Is this a time to wait and see where the market goes? Or is it a time to move quickly before mortgages potentially get harder to qualify for and/or at possible higher rates?

Answer: You have asked a great question. People on Wall Street earning millions of dollars a year don't know the answer, otherwise they would not be pleading for relief from the Federal Reserve, the Securities and Exchange Commission, the FHA, Fannie Mae and Freddie Mac.

I also don't know the answer.

What I do know is this: Real estate is a localized commodity. For example, my local MLS shows that July sales are down nearly 16% while prices increased 9.85%. This is an odd combination of results and suggests that a lot of upper-bracket homes are selling while less expensive units are remaining on the market for longer periods. Sure enough, homes are typically on the market 39 percent longer than a year ago.

Other markets show different results, thus as a prospective buyer you have to ask tough, objective questions about your own community. Is the population growing? Are new jobs being created -- real jobs that allow people to live with dignity? Is new home construction expanding or contracting?

You also have to think in the long term. Decades ago I'm told that my grandfather bought a home that was valued at $4,000 during the depression. Today the property is worth some $800,000 -- and even after inflation the real value has increased enormously.

Thus, part of the answer to your question involves real estate but another part involves your personal preferences. My grandfather didn't sell the home until he was 90 -- prior to selling he didn't care what the price was because he had a nice house and no mortgage.

And so, forgive me, I don't have an answer that applies generally to everyone or specifically to you. For me, in my community, there are long-term bargains to be had -- and I am interested. For you, in your community, speak with local economic development officials as well as local brokers.

Question: I'm a broker and was asked the following question by a home owner and potential listing client:

"We have a friend who is a broker. This person asked us some specifics about our house, which I gave. I never signed anything with this person, then got a real estate photo magazine with my house listed for a price I never set. Does this mean I have to use this person? Does this mean I have to pay them anything? Just curious. Not sure how this selling house thing works."

As a broker, if I list and sell the house do you think the agent will claim a commission? :)

Answer: If it is true that the property owner did not sign a listing agreement, then check your state rules: Most jurisdictions, if not all, require that a residential listing must be in writing; that the broker is only authorized to offer the property at the listing price agreed to in writing by the owners; that the listing has a termination date; that the listing shows the commission arrangement and that the property cannot be advertised without the written permission of the owners.

Is there any possibility that the broker has a different listing and accidentally used the wrong photo?

You are, of course, joking about a commission claim by the other broker if a required written listing does not exist. If there is no written listing and your jurisdiction requires one, then the property owner should file a complaint with appropriate real estate regulators. A list of regulators can be found at ARELLO.com.

Question: How can I find the lien holder of an empty house?

Answer: Check with your local public records office. An expansive list of online assessment records by jurisdiction which can help you find owners is located at The Property Assessment Directory.

Question: I've been recently informed that all lenders must start reporting mortgages to the appropriate credit bureaus in Canada by the end of 2007. Can you confirm or deny the validity of this information?

Answer: We asked one of our Canadian correspondents, Jim Adair, to check into this. He spoke with RBC's Senior Manager - Home Equity Financing, Janet Booth, and she says, "I've looked into this, and in fact there is no requirement for Banks to begin reporting mortgages to the credit bureaus. That said, some of Canada's financial institutions have elected to begin reporting their mortgages under a new trade line on the bureau. To date, the adoption has been limited."

We thank Jim and Ms. Booth for checking this out.

Question: Long story short, I came home from vacation to major water damage in my home. It seems that my second-floor toilet tank cracked and water ran for almost a week.

When the demolition crew was taking out walls they discovered that there was a fire in our home, at one time. We have lived in our home since 1992 and during the selling process there was no mention of there being a fire in the house. There needs to be some insulation and drywall work that is not covered under the water damage.

The previous owner of this house was the real estate agent. Do we have any recourse in this situation?

Answer: The first questions an attorney for the former owners would probably ask go like this: You have lived in this house for 15 years. How does anyone know that you did not have a fire at some point in your residency and that in making repairs you did not include insulation?

How do you know the agent-owner was responsible? Did anyone else own the property? Could the fire have occurred while the home was under construction? Do you know for a fact that there was insulation in place when the property was originally built? What if the broker hired a contractor to do repair work after the fire and the contractor -- without the owner's knowledge -- did not install the insulation? How many of us, after all, break down walls to look for insulation?

What, exactly, are the damages here? Were your heating and air conditioning bills higher than they should have been? How much higher?

What were the disclosure requirements in your state 15 years ago?

Given the time, cost and irritation of a lawsuit, why not just fix the damage and be grateful that much of the cost for a better wall is covered by insurance.

Question: I'm in the middle of buying my first home, or at least I still hope so. My pre-qual required the seller to pay 6 percent of closing costs and I managed to finally find a house acceptable to my mortgage representative. My broker submitted a purchase agreement and the seller agreed to all the terms stipulated by my mortgage rep. Three weeks later, my mortgage rep says I need to come up with a 5-percent downpayment even though they're working on a 100-percent, zero down loan. I'm terribly confused and angry about this. I was never told I'd need a downpayment until now. Should I take my business elsewhere?

Answer: Where is "elsewhere"?

What you're trying to do is purchase a home with 6-percent discount and no money down. You probably could have done such a transaction a year ago or perhaps even six months ago, but that window is largely if not entirely shut. Many of the lenders who made such loans are out-of-business, no longer offering such terms, or looking for interest rates normally associated with third-world economies.

I would expect that you have a conditional pre-approval and not an absolute financing guarantee. Speak with your broker about other lenders in your community to see if this purchase can be salvaged.

Question: I have a home that was built in the fifties and valued at $55,000. I have added a 650 square foot, two-story addition with new siding, roof, carpet and tile through-out the existing and new areas. What kind of value have we added? The roof is metal while the siding is top-of-the-line vinyl siding.

Answer: The answer depends on local values -- in Manhattan perhaps several million dollars while in the middle of Kansas a lot less.

You can ask a local real estate broker to give you an estimate of the property's current market value or you can get an appraisal. If you want to sell, then part of the answer will depend on whether your expansion is consistent with the neighborhood because the general rule is that buyers like to find the least expensive home in the most expensive neighborhood they can afford. Another issue is whether the expansion works with the present property -- going from a three-bedroom home to a six-bedroom home and not enlarging the kitchen or upgrading the heating and air conditioning is unlikely to work.

Have a real estate question? Send your inquiry to Ask Realty Times. Because of the volume of mail received, Mr. Miller cannot respond to questions individually or privately. Published letters may be edited for space and style. For comments regarding other Realty Times articles, please contact individual authors by pressing here. For past columns, please press Ask Realty Times.

This column is designed to provide accurate and authoritative information in regard to the subject matter covered. It is made available with the understanding that neither the author nor the publisher is engaged in rendering legal, accounting, or other professional services. If legal services or other expert assistance is required, the services of a competent professional person should be sought.

Published: August 31, 2007

Use of this article without permission is a violation of federal copyright laws.

Have a real estate question for Realty Times? Wondering about buying, selling, financing, refinancing or renting? Here's where you can send your question to Peter G. Miller, OurBroker®, a nationally-known columnist, author and reporter. Peter G. Miller has written six books -- including The Common-Sense Mortgage -- a guide with hundreds of thousands of copies in print. Miller was the original creator and host of America Online's Real Estate Center and joined Realty Times in 1998. Send your questions to . Because of the volume of mail received, individual questions cannot be answered privately and not all questions can be used. Published letters may be edited for space and style and all letters become the property of Realty Times upon receipt.