The Laws of your Money with Ann-Margaret Episode 9

Episode Transcript

Speaker 1 (00:00):
The following is a paid podcast. iHeartRadio's hosting of this
podcast constitutes neither an endorsement of the products offered or
the ideas expressed. The following program is sponsored by New
York Priority Medical Care. Now it's time for the Laws
of Your Money, a weekly call in show with legal

(00:20):
tips to help you protect your money. Here's your host
and Margaret Carosa.

Speaker 2 (00:26):
Hello, and welcome to the Laws of your Money. This
is a show dedicated to protecting you from legal and
financial mayhem when it comes to personal finance. I believe
there's nothing more important than protecting ourselves legally. What does

(00:47):
it matter how diligently I save and how brilliantly I
invest if there's a greater than forty percent chance of
losing our hard earned app sets to a long term
illness and expensive divorce taxes. This could be capital gains taxes,

(01:09):
estate taxes, or ordinary lawsuits. It comes as a great
surprise to many people that we are more likely to
be involved in a legal skirmish with a former loved
one than with a stranger. I believe we all have

(01:29):
potential legal landmines in our lives. Are you in a
second marriage worried about blended family warfare. Later, do you
have a special needs child, someone in your life who
is a financial black hole who is asking you for
yet another loan? Are you estranged from a family member

(01:53):
and wish to avoid a will war? Later? I am
asset protection attorney and Margaret Carosa joined today again by
my good friend and interfaith minister Paul Sladkis. Welcome to
the program.

Speaker 3 (02:10):
Paul, Welcome man, Thank you.

Speaker 2 (02:11):
Paul is going to give us human insights into all
of these legal issues. Today we are going to talk
about all things real estate. So if you have a
real estate question, please call in. We're about to introduce
a very special guest to the program who's going to

(02:34):
help us with this discussion. If you have questions about
listing a property, about renovating a property, about how capital gains,
taxes and estate taxes work with real estate, I encourage
you to call us. The number is eight hundred three

(02:55):
two one zero seven to ten. It is now my
great pleasure to welcome back to the program someone who
has more than twenty five years of experience practicing real
estate law and is now a broker with Corkoran. Welcome

(03:18):
back to the program. Lewis Riguiro, Thank.

Speaker 4 (03:23):
You and Margaret, it's a pleasure to be here.

Speaker 2 (03:26):
Thanks so much. Okay, So we're gonna jump right in.
It is now a little bit later than mid January,
and people are thinking about listing their properties. What do
you say to folks who I meet who are hedging,

(03:46):
they're not sure whether to list right now because they're
concerned about mortgage rates. What do you tell those folks?

Speaker 4 (03:58):
Well, I know, and that's that's an interesting question. That's
a question that a lot of people have now, and
I think I think they should. You should list now
because let's face it, nobody has a crystal ball, right
So you're going to find a pool of buyers who
are ready to buy now because they're they're financially qualified

(04:19):
and ready to buy in other ways. And I think
now's a good time for buyers because if you're financially
qualified at these rates, you'll find you'll find a good deal.
In my opinion. You know, there's been a little bit
of a slump in home home sales, so I think
now's a good time to buy. There's probably less motivated
buyers out there right now. If people sit around and

(04:42):
wait for rates to drop, you know, you're going to
find more buyers buying for the same property, so you
might find like an artificial inflation of the price as
more buyers come in and there's there's there's more bidding.
So for someone to list the property now, I think
it's a good idea good point.

Speaker 2 (05:01):
And what about you know, in my practice, I hear
from a ton of clients who think they want to
save a few dollars and list the property on their own. Now,
I have to tell you, in my own life, I
have never listed a property without the help of a

(05:23):
competent broker. I think there are studies out there telling
us that we end up getting more money if we
list it with a broker than foolishly trying to save
a few dollars by listing on our own. What do
you say to that.

Speaker 4 (05:41):
Well, well, of course, and excuse the biased opinion right here,
but I think if people don't list with a broker,
they're making a very big mistake. And you know, as
a broker, you know you're bringing knowledge, you're bringing expertise,
negotiating skills, all around information that's current in the market.

(06:02):
Right now, you know, another another very important part of
the broker process and as a seller that you don't
have to worry about is the vetting of people coming
to see your home or your apartment. You know, let's
face it, these there's the old expression buyers are lookers, right, Yeah.
And as a seller without a broker, do you realize

(06:24):
how much time you could possibly waste with people that
are just coming to look with no real intention to buy.
It's like super unproductive. It's gonna make you frustrated as
a seller. You're going to start wondering why the house
or the apartment isn't moving, and quite frankly, it's really
it's it's not a good feeling. So you know, a broker,

(06:48):
they're going to bring people that are financially qualified. There's
you know, there's price points to discuss that a broker
might be able to really give current knowledge on. There's
all the other things around, the photography, the staging, thesual
things that brokers know how to do. They increase the value.

(07:11):
Your time is much more well managed, and you'll sell
your house or your apartment much faster.

Speaker 2 (07:19):
And I would imagine you're going to act as a
little buffer between me selling alone and inviting a potential
nut job into my apartment to look.

Speaker 4 (07:33):
At it right, very much so, very much so and
very important.

Speaker 2 (07:38):
So you mentioned staging. Now, I know you have tons
of contacts, you know, for professional staging, selling furniture, doing
an estate sale. But when you first come to look
at a property, are you able, like off the top

(08:02):
of your head, to look around and give some concrete
advice about you know, what I should consider doing, you know,
without breaking the bank. I don't necessarily want to get
into renovations before listing the property, But are there some
easy tips that you can share that will help people

(08:26):
get the property ready?

Speaker 4 (08:28):
Sure? I think, first and foremost, a lot of people
have things in their house that are like personal to them,
but that may not be the case when you have
perspective buyers walking in and looking. So you want to
declutter your home or your apartment in such a way
that you know, these things that might be so valuable
to you might not be so much to a perspective buyer.

(08:51):
And I've always felt like those lots of things hanging
around in view, they tend to make the space look
like a little bit smaller, and they don't really enhance
the space like visually in any way. So you know,
really when you bring someone into your home, you want
to have that buyer like try to connect to the
space personally in their own way. And if there's less

(09:14):
things to like catch their attention that are important to you,
maybe not so much to them. I think I think
that's better now.

Speaker 2 (09:21):
So you want me to get rid of family.

Speaker 3 (09:23):
Photos, probably a good idea, because again it creates clutter.

Speaker 4 (09:30):
I'm not saying take every photo down. You don't want
to totally depersonalize the space that that would be like
not human. But you know, if there are a lot
of them, you know, take the repetitious ones down, maybe right.

Speaker 2 (09:42):
Right right now? Is it ever an awkward conversation? Like
what do you say to me if I bring you
into my triplex and I'm thinking about listing it? What
do you say to me about my extent andsive beanie
baby collection?

Speaker 4 (10:04):
I say, it's really I know it's special to you,
and it might not be so special to you know,
John Doe coming in tomorrow to take a look. Maybe
we could take like one hundred of the beanie babies
down and only week ten.

Speaker 2 (10:22):
Lewis you are you're a diplomat, and you're a gentleman,
And I know that you can communicate that message without
making the person feel bad.

Speaker 4 (10:33):
That's the idea. Not always so easy, but that's the
idea for sure.

Speaker 2 (10:37):
Now, how can people reach you?

Speaker 4 (10:41):
They can reach me on Instagram at Lewis the Lawyer.
They can reach me at Corcoran at Lewis Dotardjuro at
corcorand dot com.

Speaker 2 (10:52):
Awesome, Lewis. I view what you do and what I
do as kind of being next door neighbors. So I
view the value you bring to someone as maximizing the
value of the real estate that they own, and I

(11:12):
view what I do also maximizing the value in a
different way, ensuring that we're not going to be hit
with a ton of avoidable capital gains taxes, a state taxes,
nursing home leans. You know, I really recommend that everyone

(11:34):
rethink the advisability of owning real estate in their own names.
You know, we like to see our name on the deed.
On the one hand, we're very proud that we've achieved
a level of home ownership. But in today's gotcha litigious society,

(11:58):
do you agree that we should all be thinking about
protecting our real estate with limited liability entities such as
a trust and or an.

Speaker 4 (12:10):
LLC, So let me put the lawyer hat on now.
And because what you just said is so important and people,
I feel like people are starting to come around to
these ideas more now because I guess there's more information
out there on the internet or there are other ways

(12:30):
to find out, because I'm getting a lot of questions
about this, and you know this is your area of expertise,
and and I could not agree agree with you more.
You could save yourself time, money, energy, You're saving your airs, money, heartache,
avoiding family disputes down the line. It's such a good

(12:54):
idea to put your properties in one of these entities,
whether it be an LLC or a trust. You know
there's rules around around it depending on what kind of
property you buy, but you know that's for another day.
The idea in general land just as you said, it
is of the utmost importance and highly I highly recommend it.

Speaker 2 (13:14):
Well, that's very well put, Lewis. You are absolutely the best.

Speaker 3 (13:19):
You know.

Speaker 2 (13:19):
I trust you with referrals of my clients, and I
think people can't go wrong by reaching out to you
and starting the dialogue. Maybe you're not one hundred percent
sure that you're ready to list your property, but reach
out to Lewis and start that conversation. You can't go wrong. Lewis,

(13:43):
thanks for joining us. I hope you enjoy the rest
of your Sunday and I hope you come back again soon.

Speaker 4 (13:49):
Thank you for having me and I really appreciate it.
Thanks so much.

Speaker 2 (13:52):
Take care good well.

Speaker 3 (13:55):
I have a real estate question that was asked of
me to ask of you. All right, my son suggested
that I get a reverse mortgage so he can pay
down his mortgage. He will then make monthly payments to
me instead of the bank.

Speaker 4 (14:12):
Yeah.

Speaker 2 (14:12):
I think you started this question last week and we
didn't really have time to get to it. So there
are two big things here, and the one is, you know,
do we bail out a child or another loved one,

(14:33):
you know, if they're in credit card debt or you know,
they have their own mortgage issues. I guess the big
question there is and you probably don't know because they
asked you the question. But my question would be, does

(14:53):
the son have some problem? Right, he has a mortgage
and looking to pay off the mortgage. Why doesn't he
just make the payments to the bank. Right, Let's say
for argument's sake that the mortgage has a very high
interest rate. I think that the reverse mortgage that the

(15:19):
parent would take out to bail out that child would
also have a high interest rate. But let's move that
question to the side. You know, whether the sun should
be bailed out. I think these types of family loan

(15:39):
situations do start out with the best of intentions. The
son is saying, you know, whether it's credit card debt
or mortgage, pop, just give me the cash to satisfy
the debt, and I will be making the payments to you,
right that I would otherwise be making to the credit

(16:00):
card company or the bank holding the mortgage. Well, these
things start out okay. The son makes a couple of payments,
and then something comes up, a child is going to college,
or someone in the household lost their job, and now
all of a sudden, the son can't make the payments

(16:24):
and potentially leaving their senior citizen parent in the lurch
with less financial security with which to enjoy their well
deserved retirement. Right, but let's just assume that the parent

(16:44):
wants to do this.

Speaker 4 (16:46):
Right.

Speaker 2 (16:48):
What do we think about reverse mortgages. I think there
is a knee jerk reaction out there that a reverse
mortgage is a terrible thing. It's a scam on the elderly.
And I have to tell you I have no horse
in the game. I do not sell reverse mortgages, but

(17:12):
every once in a while in my office I find
myself recommending that someone consider a reverse mortgage. So let's
take an example, and I flesh this out in the
book Love and Money. There's a three page section about
reverse mortgages. A reverse mortgage, you don't go to it

(17:38):
as your first option. You go to it if you
have no other available cash and you're looking to tap
some of the equity in the home. So the first
client that I ever recommended a reverse mortgage to was

(17:59):
a widow who lived in Bayside Gables. You know, for
anyone from Northeast Queens, you know that Bayside Gables is,
you know, one of the most beautiful spots in the
city of New York with you know, quasi mansions. And
she was the widow of a physician, and they lived beautifully.

(18:24):
They belonged to a country club. And the sad reality though,
is they didn't save any money. Right they were eating out,
they were going to Broadway shows. They really really enjoyed
their lives and it came to the point where the
widow was having difficulty maintaining her lifestyle, and we heard

(18:52):
the traditional advice from nieces and nephews she had no children,
and that was down size. You should sell the home
and buy something smaller, and this way you're going to
free up some money. Well, let's imagine that we sold

(19:13):
the house for a million dollars and she bought a
five hundred thousand dollars condo or co op. Now she's
going to have maintenance fees and common charges that she
didn't have on the house, and the property taxes are

(19:34):
likely going to go up because it's newer construction than
her house that was built many decades ago. But what
if instead of selling and downsizing, she kept her beautiful house,
and instead of selling, she took out a reverse mortgage

(19:57):
where the bank sends an appraiser and approves a mortgage
for up to let's say, you know, they have a
formula no more than half of the value of the
home could be taken out, and you take it out
in the form of a line of credit so that
you're only paying interest on what you actually consume. So

(20:23):
she ended up taking out a reverse mortgage for three
hundred thousand dollars. Was she paying interest or was interest
accruing on this three hundred thousand Yes, but the property
itself was benefiting from an overall annual increase in the

(20:48):
value of seven percent. So at the end of the day,
even though upon her death the reverse mortgage had to
be satisfied and interest had to be paid, the value
of the home the increase in value far outpaced the

(21:13):
amount of the interest. But most importantly, she was able
to stay in her beautiful home, and it freed up
some cash that she could have a driver bring her
into the opera, and she enjoyed her remaining years. So

(21:35):
I think we can't have a knee jerk reaction against
a reverse mortgage. It depends upon the circumstances. Now, someone
who's over sixty five is likely not going to qualify
for a conventional thirty year mortgage because statistically they don't have,

(21:58):
you know, thirty years of working years ahead of them.
So for these people, the reverse mortgage is definitely something
to consider.

Speaker 3 (22:09):
Isn't the interest also a tax deduction?

Speaker 2 (22:13):
Yes, interest mortgage interest is a tax deduction, but in
the context of a reverse mortgage, the borrower is not
making any payments during their life. Oh right, Hey, you
would have the option to do that. Though. If you

(22:34):
think you can make payments, have at it. The bank
would be happy to take them. But the traditional upshot
of the reverse mortgage is that you don't have to
make these payments. So it's a lovely option out there,
and at the very least, I think it should give

(22:57):
people comfort and take away the worry about what happens
if you know I can no longer comfortably afford my
monthly expenses. It just gives us a little bit of
breathing room and should really help us sleep at night.

Speaker 3 (23:16):
So two things. One is I guess find somebody that
knows what they're talking about, like Anne. And two go
to a balance sheet, right, I mean, no, you know,
numbers people go by sometimes their feelings, but this is
numbers stuff exactly.

Speaker 2 (23:33):
And we don't have enough time today. But next week
I really want to get into some strategies about how
we can save more money. Right, It's not what we earn,
it's what we save. And what I know about you, Paul,

(23:55):
is that you are very good with money. You know,
you don't throw around, you enjoy your life, but you
have some skills and I'm not putting you on the
spot now, but I will next week, So put your
thinking cap on. I think everyone would be well advised
to save more money. We feel like we have more

(24:20):
power over our financial lives if we're not, you know,
running around tripping over ourselves buying every shiny new object
that we see. And if any of you have money
saving tips, you can either call in next week or
send me the tips during the week. You can reach

(24:43):
out to me on Instagram at my lawyer and and
that's ann no E on it, or you can email
me through my website and that's my Asset Protection Attorney
dot com. Okay, it is now January nineteenth. Did you know,

(25:05):
Paul that January is the month that most people file
for divorce? Did you know?

Speaker 3 (25:16):
I didn't know that.

Speaker 2 (25:17):
Yeah, And I don't mean to rain on your parade, Paul,
And congratulations for those who don't know, Paul is a newlywed.
You just got married this past Tuesday. Congratulations, thank you
at wishing you and Ivy all of the best. But

(25:38):
for many other folks, the situation is not as happy.
And again we see more divorce filings in January than
any other month. I personally believe that it's not a
coincidence that January is when the credit card bills start

(26:00):
rolling in from our wasteful ways during the month of December,
overspending for the holidays. But if you are in a
situation where you have filed for divorce or you're thinking
about filing for divorce, you need to update your legal planning.

(26:23):
Do you want you're soon to be expouse being able
to go to the bank and clean you out because
they are still holding your power of attorney? Right, that's
something that you want to change. Do you want you're
soon to be expouse being able to make life and

(26:45):
death decisions for you because they're still named as your
health care proxy?

Speaker 4 (26:52):
No?

Speaker 2 (26:52):
No, Absolutely So for those of you who think that
you're relationship status may change during this calendar year, even
before a divorce is finalized, I strongly recommend that you
update the planning. Change your will. Do you want to

(27:15):
be leaving everything to your soon to be ex spouse? Right?
Change your trust beneficiaries. If you have a properly drafted trust,
you will have retained the ability to remove and replace
beneficiaries now in the absence of a prenup or a

(27:41):
post nup. A surviving spouse is entitled to one third
of your assets, Does that mean that you must give
them one third of your assets within a will or
within a trust? And my answer to that is no.

(28:02):
Just because my surviving spouse would be entitled to one
third doesn't mean I have to give it to him
on a silver platter. Maybe I give my entire estate
to my kids, and if he pushes for his right
to one third, now my beneficiaries would be in a

(28:24):
great position to negotiate with him right and maybe he
only ends up getting one sixth of it. So when
we have a major change in our personal lives, it
is very important to look at the planning with a
fresh set of eyes. And I would urge everyone go

(28:49):
onto my website my Asset Protection Attorney dot com. Not
all of this has to be done with an attorney.
Download your healthcare proxy and make sure you're naming the
person that you trust to make life and death decisions
for you. So with that, it's been a pleasure to

(29:12):
be a part of your Sunday morning. I hope everyone
has a wonderful day and tune in next week to
the laws of your money.

Speaker 1 (29:21):
Take care the preceding program was sponsored by New York
Priority Medical Care. The preceding was a paid podcast. iHeartRadio's
hosting of this podcast constitutes neither an endorsement of the
products offered or the ideas expressed