Contractor lien must be cleared before refinancing

DEAR MR. MYERS: We’d like to refinance our mortgage because rates are so low, but a contractor placed a lien on our home last year after we refused to pay for a remodeling job that he completely botched. Will the lien prevent us from refinancing?

ANSWER: Yes, it could. To refinance or sell a home, the owners must prove to the bank that they have “clear title” to the property, in other words, that the title to the home is not clouded by any outstanding liens or other types of encumbrances. To clear up the title, you’ll have to pay off the lien.

If you don’t have enough savings to pay the bill in full now, you might still have a couple of options to get the lien removed. One would be to call or write the contractor and ask if he’ll discount the bill and remove the lien once the partial payment is made. Many contractors are amenable to such agreements, figuring that it’s better to get some money today rather than possibly waiting for years to collect in full when the property is eventually sold.

As an alternative, the bank may be willing to approve the new mortgage loan if you sign a written agreement that calls for part of the loan proceeds to go directly to the contractor in order to remove the lien. The contractor may have to sign the contract, too. Talk to your lender to discuss this and other possibilities.

DEAR MR. MYERS: We are interviewing several real estate agents to choose the one who will sell our home. Two of the agents aggressively urged us to take a long vacation once the home is put on the market, but we think we should stay here to keep an eye on the place and to sign any necessary paperwork. What do you think we should do?

ANSWER: It may sound odd, but there are several advantages to taking a vacation for a week or more soon after your home is put up for sale.

For starters, your absence would allow the agent to show your home to prospective buyers anytime that he or she wants. That means you won’t be troubled by total strangers traipsing through your home at all hours of the day and night, especially on a hectic morning when you’re trying to get ready for work or are just sitting down for a family dinner.

In addition, you wouldn’t have to spend time tidying up your home each time you plan to walk out the door. Just clean it once, before you leave for vacation, and it’ll stay spotless while you’re gone.

There’s a more subtle but equally important reason why it’s a good idea to be away when a home is being shown to buyers: In today’s growingly litigious society, even the most innocent comment that a seller may make could land them in court, facing a housing-discrimination lawsuit. Such suits have been filed for seemingly innocuous comments like “the churches around here are very good” (which offended a non-Christian couple) and “this place is perfect for a married couple” (which upset an unmarried pair that had several kids).

Your reasoning that you should stay home to “keep an eye on the place” doesn’t hold much water unless you live in a high-crime area or the home needs constant maintenance. And, any contracts or other paperwork you may need to sign while you’re away could be faxed to you, sent over the internet or delivered to your vacation destination via overnight mail.

DEAR MR. MYERS: The mosquito problem we are having in our home and yard has gotten so bad that we finally called out a pest-control specialist to see what could be done. He suggested that we install a special “mosquito misting system” in our front and back yards that would periodically release an organically based repellent into the air to drive the pests away. Do these really work? Are they safe?

ANSWER: Yes, most misting systems work, though some are more effective than others. And they’re not cheap: The larger, more complex systems that I looked up online range from about $1,200 to as much as $2,000.

They’re safe to use because the active ingredient in the repellent typically is pyrethrum, an organic material found in the flower heads of Chrysanthemums. Pyrethrum is harmless to humans, but deadly for mosquitoes and a variety of other insects.

Like your sprinklers, a misting system can be turned on by hand, be set on an automatic timer or sometimes even be turned on using a cellphone or hand-held computer. When activated, a series of small nozzles placed strategically around the exterior of the house – oftentimes under the eaves – releases the fine mist to quickly chase away or kill the airborne pests.

REAL ESTATE TRIVIA: Female mosquitoes can only lay their eggs (sometimes more than 100 at a time) in stagnant water, so homeowners should be sure to remove any standing water from their property at least once a week during mosquito season.

David W. Myers’ column is distributed by Cowles Syndicate Inc.