New home, no money down

By Jenifer B. McKim, Globe Staff  |  October 11, 2010

Jean Marie Sideris doubted she could buy a home near her job in Cambridge, because most lenders now insist on a hefty down payment for even a modest mortgage, and she did not have that much cash. But that was before Sideris, 33, found out about a state-sponsored program that requires only $1,000 toward closing costs.

In August, she became the owner of a $213,000, one-bedroom condominium, financed through MassHousing, the state's affordable-housing bank.

"It made available places I wouldn't have been able to buy,'' Sideris said.

Home loans with little or no money down are viewed with skepticism these days, given that they were widely considered to have accelerated the nation's foreclosure crisis by encouraging people to buy properties they could not afford long term. Most lenders have shied away from offering such mortgages in recent years. But a few government programs, such as the one sponsored by MassHousing, still exist.

"There is a path for low- and no-down-payment lending if you do it the right way,'' said Thomas R. Gleason, executive director of MassHousing.

Gleason said 100 percent-financed mortgages serve qualified borrowers who don't have tens of thousands of dollars to invest in a house, and provide a boost to the struggling housing market. The quasi-state agency, which is independently funded, began the program, Affordable Advantage, in July.

No-money-down borrowing represents a tiny fraction of the total number of mortgage loans in the state and country.

Under Affordable Advantage, borrowers must have a high credit score and minimal monthly debts, and agree to counseling on such matters as how they will manage monthly payments. So far, about 100 30-year, fixed-rate loans have been approved.

The program came under fire last month after critics said no-money-down borrowing could further damage the economy. It is made possible through an agreement with Fannie Mae, the troubled mortgage giant the federal government took over two years ago.

A top official at the Federal Housing Finance Agency, which oversees Fannie Mae, said recently that he plans to cancel the program after a contract between Fannie Mae and finance agencies - including MassHousing - expires in March. The loan product is available in three other states in addition to Massachusetts.

"I believe borrowers should have a down payment if they're going to purchase a house,'' said Edward DeMarco, acting director of the federal agency.

US Representative Barney Frank, a Newton Democrat and chairman of the House Financial Services Committee, agreed.

"I think a zero down payment is a mistake,'' Frank said. "Homeownership is a good thing, but we make a mistake when we push the envelope too far. You don't do people a favor.''

Gleason said he would not fight a federal decision to cancel the program. Even without it, however, a small number of buyers may still qualify for similarly structured loans through programs sponsored by the federal government.

MassHousing decided to offer Affordable Advantage last summer after tweaking requirements to improve its success rate from a similar program started in 2002. The agency has provided 1,606 low- and no-down-payment loans over the past eight years, about 7 percent of its portfolio of home loans. The default rate during the second quarter of 2010 was 9.46 percent, about twice that of all the mortgages it services but well below the 13.3 default rate for loans guaranteed by the Federal Housing Administration, MassHousing reported.

This summer, MassHousing tightened eligibility guidelines, requiring borrowers to have a credit score of a least 720 and to show a lower debt-to-income ratio. Affordable Advantage also includes income and price limits. For example, borrowers in Suffolk and Middlesex counties, including Boston, Cambridge, and Newton, can earn no more than $118,935 and can't buy a single-family home that costs more than $417,000.

Such loan programs are not new. The US Department of Veterans Affairs, for instance, has been providing low- and no-down-payment loans to its members since 1944. More than 325,000 borrowers - about 2,000 in Massachusetts - took advantage of those terms last year, nearly double the number in 2008, according to the federal agency.

The agency's mortgages help veterans buy and remain in their homes, said Bill White, acting assistant director for loan policy and valuation at the veterans department. Nationwide, about 7.8 percent of veterans defaulted on their loans during the second quarter of 2010, well below the default rate for loans guaranteed by the FHA, according to data provided by the Mortgage Bankers Association in Washington, D.C.

"We know our program works. We never relaxed credit guidelines,'' White said. "I don't see anything that would suggest dramatic changes are needed.''

The Department of Agriculture-Rural Development has offered a no-down-payment loan option for more than 50 years. About 127,000 borrowers nationwide bought homes with the help of the USDA in fiscal 2009, according to federal officials. To qualify, borrowers must earn no more than 115 percent of the median income and live in remote areas.

The default rate has also been relatively low - about 12.2 percent in fiscal 2009, said Tammye Trevino, administrator of the Rural Housing Service, which is part of the Department of Agriculture.

"We see it as a way to provide decent, safe, and sanitary housing in rural areas where many times the access to capital is missing,'' Trevino said.

Rachael Laurie, 28, and Heath Renaud, 38, financed a $220,000 home in Russell this month with a USDA-sponsored loan. The couple, who recently adopted three young children - two brothers and a sister - moved from an apartment in the same small town west of Springfield.

Laurie said they would not have been able to save enough money for a large down payment, but can easily afford monthly mortgage payments. Renaud works as a plant manager at a label company and earns about $50,000 a year. Laurie stays home with their children, including another child and three stepchildren who visit occasionally.

"We are so lucky this program is there for people like us,'' she said.

Jenifer B. McKim can be reached at jmckim@globe.com.  

© Copyright 2010 The New York Times Company
 

From the Boston Herald:

Bay State home sales figures for August - released exclusively to the Herald - plummeted more than 20 percent, declining for the second consecutive month as potential buyers were scarce despite record low mortgage interest rates, according to the MLS Property Information Network.

The good news for sellers: prices increased.

Last month, 3,145 single-family homes were sold in Massachusetts, compared to 3,947 in August of last year - a 20 percent drop. Condos did not fare any better as sales dropped to 1,345 last month from 1,749 for the same month a year ago, a 23 percent dive. MLS provided the data to the Herald in advance of the Massachusetts Association of Realtors and the Warren Group data slated to be released on Sept. 28

"Why aren't buyers buying in a buyers' market?" asked Robert Shortsleeve, regional vice president at Coldwell Banker Residential Brokerage New England.

One reason could be cost. While year-over-year sales volume is down, prices are rising. The median price for a single-family home in Massachusetts increased to $330,000 last month, up from $315,000 last August - a 4.8 percent hike.

Condos saw a similar surge. The median price for a condo swelled to $306,500, up from $280,000 one year ago, a 9 percent rise.

Despite the increase, Shortsleeve said buyers anticipate low prices given the state of the economy.

"Buyers expect Filene's Basement pricing, so they're waiting," he said. "They think that if a home is listed for two weeks, the price will drop by 5 percent and drop another (5 percent) in six weeks."

Still, Shortsleeve is not surprised that some buyers are sitting on the sidelines. He said lots of inventory is overpriced.

"If a home's real value is $500,000 based on comparable sales, but it's listed for $579,000, that's not a viable piece of inventory," he said. "The reason is not because sellers are delusional, it's because they can't afford to sell if they owe more than the home is worth."

Home values down, but tax bills rise

Struggling homeowners feel the pinch as Mass. communities try to make ends meet

By Matt Carroll and Stephanie S. Daly, Globe Staff | Globe Correspondent  |  August 22, 2010

Despite dropping home values, Massachusetts property tax bills continued to rise last year.

Revenue-hungry cities and towns, looking for money to pay for new buildings and to maintain services, have continued to push up local taxes, often asking voters to approve property tax overrides even as real estate values drop further.

The double whammy of lower home values and higher taxes - a phenomenon that has hit Massachusetts homeowners for several years - frustrates taxpayers as they endure the rocky economy.

"There's absolutely no way you can sell a house in Dedham for what it's assessed at,'' said Janet Gorman, who has lived in the town with her husband for about 30 years.

The couple, who own two single-family homes and rental property in town, sought a tax abatement on one of the rentals and got about $900 knocked off their tax bill.

"And is Dedham any different than any other town? Probably not,'' Gorman said.

The average tax bill on a single-family home in fiscal 2010 increased about $140, a 3.3 percent increase, according to figures released this month by the state Department of Revenue. The average tax bill for a single-family home was $4,390.

The statewide home values, which have more than doubled since 2000, peaked in 2007 but dropped about 4.6 percent last year to an average of $373,702.

Taking a longer view, both taxes and home values have risen over the last decade. Since 2000, average property taxes on single-family homes in Massachusetts have increased about 64 percent.

State and local officials defend the tax increases, and lower values.

"Not only is the 3.3 increase the lowest in 20 years, but it also marks the first time in at least 20 years that the annual percentage increase has gone down for four consecutive years,'' said Bob Bliss, spokesman for the Department of Revenue.

Local officials also point out that property assessments are a snapshot of values from a year or two ago.

Rick Henderson, the assistant director of assessing in Dedham, pointed out that assessed values for fiscal 2010 are based on a home's worth on Jan. 1, 2009, which was determined by home sales in 2008 in that community. A home's actual value - different from its assessed value - might have changed significantly over the last two years, he said.

"The taxes are high and I think everybody's taxes are high,'' said Jeanette Geller of Needham, who has filed for abatements at least three times in the 50 years she has lived in her split-level home. She recently won an abatement of nearly $400. Overall, property values dropped in 281 communities for the fiscal year that ended June 30. Hardest hit were Brockton, Revere,, Lynn, and Rockland, where values were clipped at least 14 percent.

"We still have a large number of foreclosures in the city, which impacts the values of homes,'' when they sell at lower prices by lenders eager to get out of the real estate business, said Mayor Linda M. Balzotti of Brockton. This is the second cycle of foreclosures the city has endured, she said. The first was caused by sub-prime mortgages. This cycle largely stems from homeowners who have lost their jobs or are underemployed.

"We still haven't quite leveled out yet, but I'm hopeful we will shortly,'' she said.

"In Revere, things have really slowed down over the last three years,'' said John Verrengia, an assessor. "Generally speaking the overall market has been tough.''

Home values in 56 communities - mostly small towns in Central and Western Massachusetts - increased. Topping the list were the towns of Washington, New Ashford, and Granville, where values climbed at least 6 percent.

Values climbed more sharply in Eastern Massachusetts during the boom years of the last decade, but have tended to fall more sharply as well.

Arlington was of the few towns in Greater Boston where values increased, by 2.4 percent.

"Arlington has something for everyone, from cradle to grave,'' said Robert Greeley, director of assessing, who pointing to the town's location and its access to Boston, as well as a strong school system, recreational facilities, and senior center.

Greeley estimated seven out of 10 people buying are from outside of town - when homes come up for sale, which isn't often. Individual homes go on the market every 28 years on average, he said.

The downturn has hit the rich as well. The number of towns where the average home value topped $1 million stood at 10, the same as a year ago. . But values dropped in seven of those towns. Chilmark, a small summer community on Martha's Vineyard, had the state's highest average value, at more than $1.8 million, down 1 percent from a year earlier.

In Weston, values slipped a fraction, but the community still had the second-highest average assessments, at $1.4 million. One home is assessed at $23.7 million, according to town records. Weston did top the list in one notable category - highest average taxes on a single-family home, at more than $15,000.

"The values here have been very stable,'' said principal assessor Eric Josephson. Still, more than 40 people filed for property tax abatements, he said. "With the state of the economy, everyone is concerned where their money is going.''

The town of Hancock had the state's lowest average tax bill, at $824.

In Boston, the average assessment was $372,138, down 4.3 percent, according to the city. The average tax bill was $2,935, up 6.2 percent. However, Boston's numbers were not included in the state data because it, along with 13 other communities, calculates data differently.

Nine towns, all west of Boston, had average taxes of more than $10,000. Not surprisingly, these towns, such as Dover and Lincoln, are among those with the highest values as well.

And nine communities had taxes jump at least 10 percent, with tax overrides or debt exclusions a major factor in most, noted the state.

Rockland was in the unenviable position of ending up among those communities with the greatest drop in valuations (14.3 percent) and highest percent increases in taxes (15.2 percent).

The tax hike was largely due to a $2.8 million override, said town administrator Allan R. Chiocca, who noted the town had the sixth-lowest average tax bills in Plymouth County, even after the override.

Overall, the town is doing well, he said. "Rockland offers a bargain to taxpayers with our low tax rate,'' he said, pointing to major improvements in renovations and building on the high school and middle school.

Joseph Modugno, a 52-year-old English professor at North Shore Community College, fought for an abatement on his Milton two-family. He likes that the community does not have many businesses, which means more "open space and unclogged streets.'' But he understands that a small commercial base means the tax burden falls more heavily on homeowners.

"What can I say? Who wants to pay taxes?'' he said about filing for the abatement.

Matt Carroll can be reached at mcarroll@globe.com and followed on Twitter @GlobeMattC.  

© Copyright 2010 The New York Times Company
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15-year mortgage rate sinks below 4%

By Associated Press  |  August 6, 2010

WASHINGTON - A plunge in mortgage rates is giving homeowners a rare opportunity to lock in a 15-year, fixed-rate loan for less than 4 percent.

Rates haven't dipped this low in decades. For those who can qualify, it's the chance to pay off a home in half the time while saving tens of thousands of dollars - if not more.

But the lower rates on short-term loans are not likely to ignite the refinancing market. Most people can't afford the higher monthly payments required by a 15-year fixed mortgage compared with a more traditional 30-year loan.

"That's not what most people need right now. They need lower payments,'' said Leif Thomsen, chief executive of Walpole, Mass.-based lender Mortgage Master Inc.

High unemployment, slow job growth, and tight credit have hampered the housing industry. And fewer people are in position to refinance, because low real estate prices have left many with little equity in their homes. Many people who would qualify have already refinanced in the past year.

The average rate on the 15-year fixed loan dropped to 3.95 percent last week, according to mortgage company Freddie Mac. That's the lowest on records the company has kept since 1991. The average rate for a 30-year fixed loan fell to 4.49 percent. Rates haven't been that low since the 1950s, when longer-term mortgages typically lasted 20 to 25 years.

On the surface, there might not seem to be a huge difference in the two rates, both of which are historically low. But consider the savings on a $200,000 mortgage over 15 years at the current rates. A borrower who refinances over that term could expect to save $65,000 in interest compared with the 30-year fixed loan. Still, they would pay $1,474 a month before taxes and insurance. With the 30-year loan, the payments would be $1,010.

In the refinancing boom of 2003, when the economy was healthier, moving from a 30-year loan to a 15-year loan was more common. Loans with 15-year terms made up about a third of mortgages backed by Fannie Mae and Freddie Mac. Now, that number is around 20 percent, according to data from Credit Suisse.

Applications to refinance loans rose 1.3 percent last week and those to purchase homes increased 1.5 percent, according to the Mortgage Bankers Association. 

 © Copyright 2010 The New York Times Company

WASHINGTON - Sales of new homes jumped last month, but it was the second-weakest month on record. The lackluster economy has made potential buyers skittish about shopping for homes

New home sales rose nearly 24 percent in June from a month earlier to a seasonally adjusted annual sales pace of 330,000, the Commerce Department said yesterday. May's number was revised downward to a rate of 267,000, the slowest pace on records dating back to 1963. Sales for April and March were also revised downward.

High unemployment, slow job growth, and tight credit have kept people from buying homes.

The industry received a boost this spring when the government offered tax credits to home buyers.

But since they expired in April, the number of people looking to buy has dropped, even with the lowest mortgage rates in decades available.

"There's no question that this is a weak number, but it seems to be more stable,'' said Stuart Hoffman, chief economist at PNC Financial Services Group. "The bottom line to all of this is that we need more jobs.''

Sales are down 72 percent from their peak annual rate of 1.39 million in July 2005. More than 600,000 new homes were sold annually from 1983 through 2007. After the housing bubble popped, sales plunged to 375,000 last year.

New home sales made up about 7 percent of the housing market last year. That's down from about 15 percent before the bust.

Weak sales mean fewer jobs in the construction industry, which normally powers economic recoveries. Each new home built creates, on average, the equivalent of three jobs for a year and generates about $90,000 in taxes paid to local and federal authorities, according to the National Association of Home Builders. The impact is felt across multiple industries.

Builders have sharply scaled back construction in the face of the housing market bust. The number of new homes up for sale in June fell 1.4 percent from a month earlier to 210,000, the lowest level in nearly 42 years.

Due to the sluggish sales pace, it would take eight months to exhaust that supply. That's above a healthy level of about six months.

The median sales price in June was $213,400. That was down 0.6 percent from a year earlier and down 1.4 percent from May.

New home sales rose by 46 percent in the Northeast, 33 percent in the South, and 21 percent in the Midwest. The West posted a decline of nearly 7 percent.

"One month doesn't make a trend and the roadblocks to a healthy housing market are high, the most important one being the still-high jobless rate,'' wrote BMO Capital Markets economist Jennifer Lee in a note to clients. "But with borrowing costs at record lows, prices also remaining low, those with jobs who can afford a home may be enticed.''

The stock market might be behaving badly, but that's not a reason to leave stocks out of your long-term financial planning right now. In fact, with the market near recent lows, you may be more interested in considering one of the most common financial conundrums for homeowners: Is it better to use your excess cash each month to pay off your mortgage faster or to invest?

If this question piques your interest, congratulations for having excess cash. Not many families in the United States are as lucky as you, particularly with so many currently unemployed. Assume you have this surplus even after saving for retirement and other long-term goals and you are comfortable with your emergency fund. There are advantages to using this additional cash flow to accelerate your mortgage payments, but in some circumstances, investing the money would be a better choice.

Check with your lender to ensure you won't be penalized for paying more than the bank expects. If there is no extra fee, doubling your monthly payment from the beginning of your mortgage could reduce the total interest you pay to the lender by tens of thousands of dollars. Eliminating that interest is similar to receiving a guaranteed return equal to your mortgage interest rate.

It's not uncommon to compare this interest rate, currently averaging around 5 percent, with the average long-term return for the stock market, about 8 percent. One method for deciding whether to prepay your mortgage depends on which interest rate is higher; if your mortgage rate is lower than the expected stock market return, you should invest as much as possible and take the slow route to paying off your mortgage.

This doesn't take risk into account, however. While prepaying your mortgage is a guaranteed increase in your net worth, there are no such guarantees when investing in the stock market. Building equity in your house, which you can accomplish faster by accelerating your mortgage payments, is a relatively safe storage of your wealth when compared to a stock market index fund or a small selection of stocks.

In addition to this risk, the stock market is volatile. Your mortgage interest rate won't change year after year unless you refinance; your stock market investment may lose value for several years and take the rest of the decade to recover. Worse, the stock market may decline in the final years as you begin to need those funds to replace your income and never recover.

Also consider your expected retirement date. If you follow a typical career path, you will likely have less income to spend in retirement. By eliminating your mortgage quicker, you pay your mortgage down when you can better afford the payments, releasing yourself from anxiety, stress, and house payments when your income shrinks in retirement.

Other factors contribute to this decision. If you don't plan on staying in your current house and expect to sell within a few years, there may be no need to speed up your mortgage payments. If you decide to invest your excess cash because of the anticipated financial benefits, you must commit to investing. I've heard from many readers who choose not to send the bank their extra money each month with the intent to invest, but other expenses inevitably arise. Whether it's lack of discipline or necessity, the misdirected cash prevents these families from seeing the benefit of a stock market that generally, over the long term, increases at a rate higher than most mortgages.

Whether to pay your mortgage off early or to use your excess cash to invest is a personal decision. While the numbers may help you decide, you can't make the choice without considering your needs beyond having the highest net worth possible at the end of the day and your ability to stick to the plan.

URGENT MESSAGE FOR ALL TRAVELERS AGENTS!

The National Flood Insurance Program's (NFIP) authorization expired at Midnight on May 31, 2010

**During this lapse, no credit cards, E-Checks or ACH Transactions (agency sweep) will be accepted.**

The following is based on guidance that FEMA published on rules of the NFIP during the lapse:

Flood New Business

• If Travelers received a new business application with proper payment prior to midnight 5/31/10, the policy will be processed and issued in accordance with standard NFIP effective date rules.
  
• If Travelers received an application prior to midnight 5/31/10, but did not receive proper payment until after midnight on 5/31/10, the new business will not be issued until the NFIP is reauthorized. The effective date of the policy will depend on whether or not Congress reauthorizes the NFIP retroactively.
  
• If a new business application is submitted and payment received after 5/31/10, Travelers is not able to issue the new business policy during the lapse period. The effective date of the policy will depend on whether or not Congress reauthorizes the NFIP retroactively.
  
• For loans that closed prior to midnight on 5/31/10, if the flood application date is on or before the closing and the payment check is from the escrow account (lender's check), title company or settlement attorney, the policy will be issued even if the application and money are received after 5/31/10. Standard NFIP receipt date rules apply.
  
• If Congress fails to reauthorize the NFIP, or if congressional action is not taken within a reasonable amount of time, any premiums being held for any new business application that we are unable to process as outlined above will be returned and no policy or coverage will have gone into effect.

Flood Renewals or Added Coverage Endorsements

• If Travelers received a renewal instruction or added coverage endorsement with proper payment prior to midnight 5/31/10, the renewal policy or change will be processed and issued with standard NFIP effective date rules.
  
• If Travelers received an added coverage endorsements prior to midnight 5/31/10, but the money was received by Travelers after midnight on 5/31/10, the added coverage endorsement will not be processed until after the NFIP is reauthorized. The effective date will depend on whether or not the legislation is retroactive.
  
• Travelers cannot mail renewal offers after midnight on 5/31/2010. Travelers is not allowed to process any increase in coverage if the request and payment are received by Travelers after midnight 5/31/2010.
  
• If Travelers issued the renewal offer prior to midnight on 5/31/2010 and the premium is received by Travelers within the 30-day grace period, the renewal policy can be issued even if the premium is received after 5/31/2010.
  
• If an Underpayment Notice was issued prior to midnight on 5/31/10 and the premium is received by Travelers within 30 days of the date of the Underpayment Notice, the added coverage endorsement can be issued even if the premium is received after 5/31/2010.
  
• If Congress fails to reauthorize the NFIP, or if congressional action is not taken within a reasonable amount of time, any premium we are unable to apply based on the rules stated above will be returned. Coverage will be determined based upon the rules of the NFIP.

FEMA HAS RECOMMENDED THAT WE HOLD ANY PREMIUM RECEIVED AFTER MIDNIGHT ON MAY 31, 2010 FOR NEW POLICIES, RENEWAL POLICIES, OR ADDED COVERAGE ENDORSEMENTS AS WE AWAIT CONGRESSIONAL ACTION. IF CONGRESS PROVIDES RETROACTIVE REAUTHORIZATION TO THE NFIP, POLICIES/ADDED CHANGE ENDORSEMENTS WILL BE AFFORDED THE EARLIEST EFFECTIVE DATE BASED UPON TRAVELERS RECEIPT OF THE TRANSACTION AND PREMIUM.

For Example: If you submit a new policy today and the reauthorization is made retroactive, we will use today's date as the beginning of the waiting period using standard NFIP effective date rules. If you wait to submit something until the reauthorization is approved, that future submission date will be used in calculating the waiting period.

Flood Claims

• Claims on properties where there are policies in force will be processed and paid as usual during this lapse.
  
• Unless Congress provides retroactive authorization of the NFIP, claims CANNOT be HONORED under a new policy, renewal policy or an added coverage endorsement transaction, if those transactions were not able to be processed and issued as outlined above. WYO Companies may investigate claims under a reservation of rights or non-waiver agreement, up to the point of payment. WYO Companies would continue to investigate the claim but would reserve the right not to pay the claim if Congress does not reauthorize the NFIP.

Travelers Flood Team appreciates your business and we are hopeful that this communication is helpful. If you have any questions regarding a specific policy or the lapse in general, please call the Travelers Flood Customer Service Team at 1-800-356-6670 Option #4.

Important notice regarding Travelers Personal Insurance Property Eligibility - Homeowners and Homesaver/Dwelling Fire Eligibility

Our current Homeowners and Homesaver/Dwelling Fire Eligibility Guidelines show the following as ineligible:

In addition, in some coastal areas of East Coast and Gulf Coast states, excess flood insurance coverage above the limits provided by FEMA is also required.

There is no change to the above eligibility requirements for Homeowners and Homesaver/Dwelling Fire business. We cannot accept business in these areas where a flood policy is not in force. Accordingly, new or increased Homeowners and Homesaver/Dwelling Fire coverage requests on homes located in these areas are ineligible and cannot be bound without an inforce flood policy.

Questions regarding Homeowners and Homesaver/Dwelling Fire Eligibility should be directed to 1-877-878-2468 (ASO Agents) OR 1-877-872-8737 (CCC Agents).

A dwelling subject to flood or wavewash (all Flood Zones V and A) unless the risk is covered by a Flood Policy up to the Coverage A and C limit, or the FEMA maximums of $250,000 Coverage A and $100,000 Coverage C, whichever is less.

In  a recent New York Times article series about the difference between male and female drivers across the globe, the verdict seems to be in. Women drivers get the prize for being safer drivers overall, on the road. But this doesn't come as a big surprise to most people in the insurance industry..

When insurance companies compare the number of accidents and claims reported by men vs. women, the results show that men report a much higher number of accidents than women, regardless of education or income level.

Why are men involved in so many more accidents? The Times article series reports that men are more likely to ignore traffic signals, to honk their horns, to rudely gesture at other drivers, and to be involved in tragic accidents. (Ouch fellas!)

But, we hate to put all men in the same boat. Although men may be charged slightly more for auto insurance, there are a lot of ways to help decrease the costs. Drivers who complete a Driver Safety or Defensive Driver class, for example, may be eligible to save up to 15% on their bi-annual premium. Also, simply practicing safe driving can help reduce rates as most insurance companies will reward good drivers each year they remain accident and claim free.

Paul T. Murphy Insurance Agency
16 Lebanon St, Malden MA 02148
781-321-9700
781-324-4253 (fax)
www.paulmurphyinsurance.com

Just a few weeks ago a fire devastated a home in my neighborhood. Luckily, the family escaped unscathed.  The damage to the home was unrepairable however, and the family is now planning to re-build their home from scratch. (Good thing for homeowners insurance, huh?)

Every once in awhile I like to remind everyone of some of the easy ways to prevent house fires in hopes that homeowners will become more aware of how easy it can be to prevent a fire in their home. Some of these may seem like common sense- which is probably why so many people commonly overlook them.

Tips for Preventing a House Fire

1- Get a home inspection
Once a year or so it is a good idea to hire someone who is experienced in home electrical wiring, plumbing (water and gas) and heating and air to inspect your home and check for any obvious fire hazards. Ask them specifically to check for:

• improperly grounded receptacles
• wiring in the attic or basement that has been damaged by pests or insects
• overloaded circuit breakers
• proper function of the ground cable
• vent stacks on gas powered appliances
• automatic ignition systems on gas appliances
• AC coils that need to be cleaned

2- Stay in the kitchen or turn it off!
When using your range to cook, if you find you must leave the room for even just a few seconds, make sure to turn off all burners. A quick  trip to the basement or to the mailbox could be long enough for an unattended fire to spread.

3-Don't Smoke...especially horizontally
One of the biggest causes of house fires are cigarettes that ignite bedding, furniture or carpets. Never smoke when you are tired or  laying down. When you, or anyone in the home, empties an ashtray- be sure the ashes are completely out or wet them before dumping in the trash can.

4- Space Heaters Need to be Monitored!
Space heaters cause thousands of house fire every year.  If you use one in your home, be sure to monitor it and never leave one on when you aren't home. Make sure to keep curtains and any other flammable materials at least 4-5 feet from any space heater. Never balance a space heater on a chair or table where it can be knocked off onto the floor.

5- Keep that Chimney Clean!
Have your chimney inspected and cleaned by a professional chimney sweep once a year so that they can check for excessive creosote buildup and proper fireplace functionality. Always place a screen or glass shield in front of the fireplace to reduce the risk of hot embers popping out of the fireplace.

6-Maintain and Test Fire and Smoke Alarms-
Making sure that these devices work properly is critical as they could save your life in the event of a fire.

What is a flood?  In simple terms a flood is an excess of water on land that
is normally dry.  Officially the defininition used by the National Flood
Program a flood is a temporary condition of partial or complete inundation
of 2 or more acres of normally dry land.  (At least one which is your
property).  Is this covered on your homeowners policy?  NO.  Can you buy
coverage?  YES.  You can purchase a flood insurance policy.

Get educated!  Important Facts about Flood Insurance
Flood inusrance is available...just because your bank doesn't require it or
you may not think you are in a flood zone affordable coverage is available
for you.   Flood insurance is NOT a replacement cost policy.  Unlike your
homeowners policy flood insurance does not pay more than the policy limit.
(Maximum 250,000).  Flood insurance is NOT a valued policy...that means it
pays just the actual cash value of the actual damages up to the policy
limit.  Contents coverage must be purchased seperately with it's own limit
and is not included in the main limit of the policy.  To help you understand
more about your flood policy CALL today and talk to us!  Our team of
educated professional can answer all of your questions about your flood
policy.  Don't wait for it to keep raining.



Alexis S. Nuzzo
Personal Account Representative
Home &  Auto Insurance
Paul T. Murphy Insurance Agency
16 Lebanon St, Malden MA 02148
781-321-9700
781-324-4253 (fax)
www.paulmurphyinsurance.com