Choose your condo wisely, and other good advice to avoid going to court

I have nothing to add to this article, which features advice from excellent condo lawyer Chris Jaglowitz. If you’re looking to buy a condo, keep all of this in mind.

A little preparation goes a long way

If you ask most people, they would prefer that none of their hard-earned assets end up wasted on taxes or professional fees, or simply squandered, when they are passing them on to the next generation. Unfortunately, however, these things often happen, especially as estates get bigger – and we’re often worth more dead than alive, so estates are always getting bigger. Here are some ways to help prepare your heirs to inherit:

  1. Share assets during your lifetime. Gifting money to your children now allows you to see it enjoyed. It also allows you to see whether they will spend it wisely.
  2. Set up a trust. While there can be some tax consequences to trusts, they can also have a lot of benefits if set up for the right reason and in the right way. Always speak to your accountant, financial planner and lawyer before making the final decision, but where they make sense, they can allow you to save significant time and money transferring assets on your death, and can protect those assets from your heirs’ ex-spouses and creditors.
  3. Teach them about money. It’s never too late – or too early – to start learning. My two-year-old plays with his cash register and is learning about how many “coins” it takes to buy “milk” but we will be teaching him with real money before too long. Even if your children are adults, if you’re concerned about their ability to handle money, you can always still teach them. This also applies to grandchildren.

Estate planning is not a set-it-and-forget-it situation. Ensuring your assets don’t disappear the moment you die can require a bit of work, but it’s worth it.

 

 

 

 

What questions do people forget to ask when buying a house?

Buying a house can be both exciting and scary. Whether it’s your first home or your fourth, there are some questions that you should definitely consider as you start looking. Lifehacker asked people a while ago what they were glad they asked when they bought a house. Here are some that truly can make the difference between a for-now house and a forever home:

 

  1. What is the neighbourhood really like? Have you been there at different times of day, and on different days of the week?
  2. How accessible is the house by public transit if that matters to you? Are there places to walk to, such as parks, shops or restaurants?
  3. Is the city investing in infrastructure? How recently was the street or neighbouring streets paved, or the pipes done?
  4. What are the neighbours like?
  5. If you have children, what are the schools like?
  6. Is the house on or very close to a busy street? What will it be like backing out of your driveway?
  7. How much will utilities cost? Will it be prohibitively expensive to heat your house in winter or cool it in summer?
  8. What kind of cable or internet are you able to get?

Asking the right questions can save you time and, most importantly, stress down the road. You may need to move in the near future, but make it because of something else in your life and not because you don’t want your kid taking the bus to school.

DIY

I’ve talked about doing your will yourself many times before, and I always start by saying I’m biased in this regard, because I am. I draft wills for a living, so I obviously am going to recommend getting a lawyer to draft your will instead of doing it yourself.

But don’t take my word for it. Check out this article  from The New York Times. Will preparation programs seem like the best new thing, but as the author notes, you don’t know what you don’t know, and the kits are quite simply not good enough.

It’s important to have a will. It’s equally important to have a good one.

I’m back!

I haven’t blogged in a really long time. Life got very busy last year – real estate was quite busy in the summer, plus I was expecting my second child. I’m now back to work after welcoming a daughter into our family last fall, and I’m ready to get back into blogging again. I look forward to having specific information to share again starting next week.

Co-buying a home

Think of your siblings, or perhaps your closest friends. Could you buy a home with them? As in, have permanent, legal roommates?

 

This is a new trend, mostly among millennials who are finding themselves priced out of hot housing markets. In Toronto, for example, where the average house price is moving close to $800,000.00, many people are looking to alternate arrangements instead of settling for a condo. Co-buying allows them to afford a house, maybe even a detached house, when alone they wouldn’t have the income to support it.

 

There are some definite dangers to consider. First, how well do you know the finances of your co-buyer? How secure is their employment? How good are they at paying their bills? Some people with good incomes simply forget, or choose not to pay certain bills. If your co-buyer doesn’t pay their share of the mortgage, however, you could lose your house.

 

Most importantly: what happens if your relationship breaks down? This is not an investment partner; this is someone who will live with you in your house. Especially if you don’t have separate entrances, you will be seeing a lot of this person. Do they leave dirty dishes in the sink or dirty socks on the floor? Do they have a noisy pet, or a young child? Do you? What happens if one of you wants to sell and the other doesn’t?

 

Co-buying has the potential to help you into a really hot market, but there are a lot of possible issues. If you are thinking about it, you should definitely have a written contract with your co-buyer that sets out all of the possible issues and how they are to be resolved – and you should do this before you buy.

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Don’t set it and forget it

I have had multiple clients come to see me over the past several months because they need to update their wills. The wills were all at least 20 years old; they named family members as executors who had long since died or become incapacitated, they had complex trusts for children who were well into adulthood, or they named beneficiaries who were no longer in their lives.

It is so important to review your estate planning documents on a regular basis. I tell my clients to pull them out every two or three years; if it still fits your life, then put it away again, but if it doesn’t, you want to update it sooner rather than later.

An estate plan is a living thing. Having a will and powers of attorney is incredibly important; having them up-to-date is just as important.

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Happy holidays!

We’re taking a break from the office, so I’m taking a break from the blog. I wish you and your family a very happy holiday season, and we’ll see you in 2017.

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When it comes to real estate, pay attention to the details

There is a lot of fine print in the real estate industry. Purchase and sale agreements, mortgage commitments…there’s a lot there that most people don’t read too closely. Ultimately, you should, but if you’re not going to, you need to at least be aware of what could bite you so that you can ask a trusted advisor what applies in your situation.

When buying, always look at what you’re agreeing to assume in rentals. Is there a furnace rental, or a water softener? If so, do you want them, or would you rather have ones that you own? If you agree to take on a rental, you have to do so. Conversely, if you’re selling, be sure that you’ve at least addressed all of the rentals. It’s never pleasant to find out not long before closing that you have to buy out an expensive furnace because it didn’t get listed in the agreement. Sellers should always be aware of what they’re agreeing to provide for a survey, and make sure they have it before they sign. And if you’re buying or selling, always, always read the extra schedules so that you’re sure what you’re agreeing to do.

With mortgages, it’s important to look beyond the rate. Do you want to be able to pay it down aggressively? Have you talked about the length of the term and the amortization? It’s obviously important to get the best rate you can, but if you have other objectives, you want to ensure they’re being met.

As they say, the devil is in the details. And a devil is not what you want in your new home or mortgage.

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How (not) to sign a will

One of the easiest things to do wrong on a homemade will (one done through a kit) is in the signing. Signing your own name at the bottom is not the problem; getting witnesses is.

I was recently asked if a will was valid based on the fact that one of the beneficiaries had witnessed it. That situation is one of the most distressing for a beneficiary, because yes, the will is valid, but the gift completely fails. If you witness a will that you’re named in, you are going to get nothing. It’s a failsafe to ensure that you aren’t forcing someone to sign a will naming you as the beneficiary when there has to at least be someone else there to witness. It’s also a reason why having a lawyer help with your will makes your will that much better.

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