As deficit looms larger, senators' eye cuts in mortgage interest deductions

Just because President Obama's latest budget proposal calls for rollbacks in mortgage interest deductions solely for high-income taxpayers, should you assume that all of your write-offs as a homeowner are secure from attack?

Absolutely not. In fact, those tax benefits - from capital gains exclusions to home-equity and second-home interest deductions -might be more vulnerable to broad-based cutbacks during the next two years than at any time in decades.

Here's why: An influential, bipartisan group of lawmakers on Capitol Hill, led by a so-called "gang of six" in the Senate, is drafting a legislative framework that would essentially seek to implement much of the president's deficit reduction commission report released last December. The legislation would set annual targets for higher revenues and lower spending in multiple budget categories, and would impose automatic, severe cuts if Congress did not hit those targets. Congress would have two years to figure out how and where to make the required reductions.

The Senate group, which is quietly working with deficit-reduction advocates in the House, consists of Majority Whip Richard J. Durbin (D-Ill.), Tom Coburn (R-Okla.), Budget Committee Chairman Kent Conrad (D-N.D.), Mike Crapo (R-Idaho), Mark R. Warner (D-Va.) and Saxby Chambliss (R-Ga.).

Durbin and Conrad were members of the commission. Both voted to approve the final report, which called for $1.7 trillion in federal discretionary spending cuts and $180 billion in tax revenue increases over the coming 10 years. The commission argued that across-the-board trimming of spending and tax benefits is necessary to control the wildfire national debt, now more than $14 trillion and rising fast, which is projected to exceed 90 percent of the country's gross domestic product by 2020 if left on its current path.

Among the tax expenditures the commission specifically targeted were the annual breaks that now flow to homeowners, including mortgage interest write-offs for first and second homes, deductions for home equity lines of credit and second mortgages, property tax write-offs and the $250,000 and $500,000 capital gains exclusions for single and married taxpayers, respectively, who sell their houses at a profit.

President Obama praised the broad goals of the commission but only included a relatively small cutback in mortgage interest deductions - a 28 percent deduction cap on write-offs by single taxpayers with incomes higher than $200,000 and married taxpayers earning more than $250,000 - in his own budget proposal for the upcoming fiscal year.

The legislative draft, which is expected to be circulated to senators in March, already is controversial. For example, Sen. Charles Schumer (D-N.Y.) reportedly is demanding that Social Security changes be exempt from the plan. But members of the drafting group disagree and argue that, to be effective and fair, no major budget-related items - no matter how politically sensitive - can be omitted.

"Everything has to be on the table," said Coburn. "There can be no sacred cows and pet priorities." As to tax code changes, Durbin said that the only way to reduce the deficit is to "ensure that everyone pays their fair share . . . we need to look at the money we forgo every time we hand out a new tax break. These 'tax expenditures' cost the Treasury as much as we spend in appropriations each year with much less oversight."

What's on the line for housing and homeowners, whose write-offs have been widely assumed to be politically untouchable? Big money by any measure. According to the latest estimates prepared by the congressional Joint Committee on Taxation, the mortgage interest deduction will cost the government $99.8 billion in uncollected taxes this fiscal year and $107.3 billion in fiscal 2012. Homeowner property tax write-offs will cost $26.6 billion in uncollected taxes this year and $31.6 billion in 2012. The $250,000/$500,000 tax-free exclusions on capital gains for home sale profits are projected to cost the Treasury about $19 billion this year and $21 billion next year.

No one anticipates that these benefits could be eliminated or even severely slashed within a couple of years. And while housing trade groups have not yet spoken out about the plan being drafted in the Senate, they privately worry that, because of the sheer size of the national debt, leaders from both parties could conceivably join with the president to structure some form of grand debt reduction compromise that requires all special interests to chip in.

"We definitely take this seriously," said Rob Dietz, an economist and tax specialist for the National Association of Home Builders. "We are going to have to continue to make the case for housing, and remind [Congress] just how important housing is to the economy."

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Peak buying time ahead, mortgage rates rise

The average rate on a 30-year mortgage topped 5 percent this week for the first time since April, and higher rates could further hamper the struggling housing market ahead of the spring's prime home-buying season.

Freddie Mac said Thursday that the average rate rose to 5.05 percent from 4.81 percent the previous week. It hit a 40-year low of 4.17 percent in November. The average rate on the 15-year home loan, a popular refinance option, increased from 4.08 percent to to 4.29 percent. The average rate on a five-year adjustable-rate mortgage rose to 3.92 percent from 3.69 percent, and the average rate on one-year adjustable-rate home loans increased from 3.26 percent to 3.35 percent.

Thirty-year rates are following the yields on the 10-year Treasury note, which are spiking on fears of higher inflation. Investors have been demanding higher Treasury yields since the Federal Reserve began its $600 billion bond-buying program to boost the economy.

Rates may not have an effect on homebuying until they reach about 6 percent, said Tom Tzitzouris, head of the fixed-income department at Strategas Research Partners in New York. The current levels are a "neutral zone," and buyers are neither prodded to sign nor discouraged from the market, he said.

"If you get another uptick again next week, you may see some movement," said Tzitzouris, who previously worked as a valuation manager for Freddie Mac and as a debt securities analyst for Fannie Mae.

The payment difference between today's rate and the historically low rate in November on a $200,000 loan is less than $100 a month, not enough to price a buyer out of a market, said Greg McBride, a senior financial analyst with Bankrate.com. There also are many buyers who are paying cash.

Mortgage applications fell for the second time in three weeks, a Mortgage Bankers Association index showed Wednesday. The group's gauge of purchases decreased 1.4 percent in the week ended Feb. 4, and its refinancing measure dropped 7.7 percent.

To calculate average mortgage rates, Freddie Mac collects rates from lenders across the country on Monday through Wednesday of each week. Rates often fluctuate significantly, even within a single day.

The rates do not include add-on fees, known as points. One point is equal to 1 percent of the total loan amount. The average fee for the 30-year and 15-year loan in Freddie Mac's survey was 0.7 point. The average fee for the five-year and 1-year ARM was 0.6 point.

-From news services

4.81%

Last week

5.05%

This week

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Cash deals raise January sales of existing homes, report says

Sales of previously owned homes increased nationwide in January, driven by all-cash purchases that suggest investors are chasing after foreclosures and other bargains in an ailing housing market, an industry group reported Wednesday.

Sales rose 2.7 percent from December, to a seasonally adjusted 5.36 million, the National Association of Realtors reported. The purchases - which include single-family homes, condominiums and townhouses - were up 5.3 percent from a year ago.

Although the figures reflect an improved economy, they also capture some of the underlying weaknesses in the housing market, namely the persistently large number of foreclosures that continued to drag down prices in January and attract investors.

Foreclosures and other distressed properties made up 37 percent of homes sold last month, the group reported. The cheap homes lured investors, who accounted for 23 percent of buyers, up from 20 percent the previous month and 17 percent a year ago.

As more investors entered the market, all-cash purchases surged to their highest level since the group started tracking the numbers in October 2008. The increase suggests that stringent lending rules are shutting out traditional buyers and empowering people with hefty sums of cash to close deals, said Lawrence Yun, the group's chief economist.

But the January sales numbers may be deceptively high, said Mark Vitner, senior economist at Wells Fargo Securities.

After reports of widespread paperwork errors surfaced in October, many major lenders temporarily halted foreclosures. Some have since lifted the freeze. "Sales that would have normally taken place in October, November and December got pushed into January," Vitner said.

None of this bodes well for home prices, because foreclosures tend to drag down values. The median price nationwide fell 3.7 percent, to $158,000, in January, the Realtor group said.

Many economists said that if the economy takes a turn for the worse or oil prices rise significantly because of political turmoil in the Middle East, consumer confidence could wane and home sales could plunge.

Some economists also cast doubt on the Realtor group's numbers, suggesting that they were inflated because of its methodology. Most recently, mortgage research firm CoreLogic said the sales results could have been overstated by 15 to 20 percent in 2010.

Yun said his group will review data from the past few years.

He acknowledged a possible "upward drift" in the numbers. The sales data are collected from local multiple listing services. A Realtor, for instance, may advertise a home in two neighboring cities. When the home sells, the transaction may be counted twice, he said.

A decline in homes sold by owner may also distort the numbers, Yun said. Multiple listing services include mainly properties advertised by Realtors. As more sellers have turned to Realtors in recent years, the increase may register as an increase in sales when it is only a rise in transactions by Realtors, he said.

Yun cautioned that no housing data is flawless. The CoreLogic data, for instance, came from court records. As the recent foreclosure paperwork debacle shows, not all court records are accurate.

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Major changes ahead for mortgage system as U.S. seeks to scale back role in housing

Fundamental changes are probably ahead for the American mortgage system as the federal government pushes to unwind its unprecedented involvement in the housing market.

These changes could significantly raise the down payments demanded by lenders, curtail the availability of long-term mortgages with fixed interest rates, and increase the cost of borrowing in general.

The government's effort to scale back its role in housing could show up in small ways soon. In April, the Federal Housing Administration plans to raise the annual premium it charges borrowers by a quarter of a percentage point. In October, the maximum size of loans that the federal government backs is scheduled to drop to $625,500 from $729,750. The most dramatic proposal - eliminating mortgage financiers Fannie Mae and Freddie Mac - could take five to seven years.

The thinking is that the government cannot sustain its role in the housing finance system. Federally backed loans make up an outsize share of home purchases - about 90 percent - through Fannie, Freddie and the FHA. Taxpayers have kicked in more than $130 billion to cover Fannie and Freddie losses during the housing crisis, and they could be on the hook for more if the FHA depletes its cash reserves, which are already lower than the level required by law.

All three institutions guarantee that payments will be made to mortgage investors, even when loans go bad. Those guarantees helped keep the housing market from coming to a standstill during the darkest days of the economic crisis.

"But the government is taking on a lot of credit risk," said Mark Zandi, chief economist at Moody's Analytics. "So if loans go bad, it's on the taxpayer. Everyone would find it preferable if the private sector were to take more of the risk."

Loan limits

To that end, the federal government is eager to tackle the "jumbo" loan limits.

In the District and most of its neighboring counties, a temporary federal policy allows the government to back mortgages up to $729,750. Such loans typically carry a lower interest rate than those without government backing, in part because the federal guarantee makes them a safer bet for investors.

"Investors are willing to accept a lower return if their investment is less risky," said Keith Gumbinger, a vice president at HSH Associates.

The Obama administration has supported allowing the maximum loan limit to drop to $625,500 starting Oct. 1 , and Congress is expected to back that move. (Loan limits may be lowered even further for FHA-insured loans, federal officials said, though no details are available.)

Once the cap is lowered, loans larger than $625,500 will fall into the "jumbo" category. Jumbos are perceived to be more risky and therefore often face tougher requirements, such as 30 percent down payments and stellar credit scores.

Standards might ease if the private sector reenters that market, said Eric Gates, president of Apex Home Loans in Rockville. But if the $625,500 cap were in place today, it could lock many potential buyers out, he said.

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Do-it-yourself: How to remove soap scum

Q. I have a fiberglass shower wall and tub that have accumulated a lot of hard-water stains, soap scum and dirt. I have tried all kinds of products, and they just don't clean it. Can you help? ¿ C. Davis

A. Fiberglass surfaces are rather easy to keep clean once you get them that way, but removing existing crud could take a lot of scrubbing.

Don't use abrasive cleaners; they can dull or scratch the surface. One product worth trying is Mr. Clean Magic Eraser Bath Cleaner. This is an oversize version of the regular Mr. Clean Eraser. You will probably need several to remove a lot of accumulated grime.

Another product sometimes recommended is ordinary baking soda. Put a generous amount of baking soda on a soft, white cloth, moisten it and scrub.

Some hard-water stains can be removed by scrubbing with full-strength white vinegar. For tough stains, make a paste of vinegar and baking soda and scrub with that.

Once you get the fiberglass clean, here is how to keep it that way: After every shower or use of the tub, use a squeegee to wipe water from the flat surfaces. Then use your towel to wipe down the walls and tub, leaving them as dry as possible. The wipe-down takes only a minute or so, and it pays off by not giving the hard and soapy water a chance to form stains.

Q. I just moved into a building where the previous occupants must have played indoor baseball. There are several holes in the drywall about the size of a baseball. Is there a fast, easy way to patch these holes? ¿ G. Arnold

A. Holes in drywall aren't difficult to patch, but the job is seldom fast and easy. It is usually necessary to repaint the entire wall after patching.

As for the holes, which are often caused by the bumping of doorknobs or the corners of furniture, there are at least a dozen ways to patch them. Many do-it-yourselfers prefer to use a repair kit, sold at many home centers and on the Internet. Kits generally contain all or most of the materials needed to make the patch. Look for a kit that includes drywall joint compound, which is needed to smooth over the patch.

If you have several holes and don't want to use kits, you can buy the materials separately. Buy "setting type" joint compound, which comes in bags and lets you mix only as much as needed for the job at hand.

The following is my favorite method for patching drywall holes: Make a square pattern from cardboard that covers just the hole and draw an outline of the pattern around the hole. Neatly cut the edges of the drywall around the hole to match the pattern lines, using a sharp utility knife or a fine-toothed keyhole saw. Next, cut a piece of drywall that is about one inch larger on all sides than the pattern; this will be the patch.

Place the cardboard pattern on the back of the patch and draw its outline so that there is a margin on all sides. Cut out only the back of the patch, along the pattern lines, so that the front paper covering is left in place to form four thin flanges.

Test-fit the patch in the hole, then butter the back of the flanges and the edges of the patch with joint compound and press it in place with a six-inch-wide drywall joint knife. The paper flanges should hold the patch in place.

When the compound dries, smooth over the flanges of the patch with more joint compound; three coats are usually needed. Let each coat set up for several minutes, then carefully smooth it with a damp sponge and let it dry. This will reduce the need for sanding. When the patch is smooth and all the compound is dry, prime the patch and repaint the wall.

QUICK TIP: Reader Les Hamilton suggests trying an oscillating multi-tool for power removal of old tile grout. These small, hand-held power tools, sold under a variety of brand names that often include the word "multi," have a very rapid reciprocating action. They can be fitted with a variety of small blades that perform tasks such as sanding, sawing and scraping. Hamilton says his MultiMax tool kit, made by Dremel, includes a blade for grout removal. Dremel MultiMax kits sell for about $100.

If grout removal is one of the main reasons for buying a multi-tool, I recommend checking first to make sure a grout-removal blade is included or is available as an extra accessory. Multi-tools are excellent for working in tight places and are available in corded and battery-powered versions.

¿McClatchy-Tribune

Questions and comments should be e-mailed to Gene Austin at gaus17@aol.com. Send regular mail for Gene Austin to 1730 Blue Bell Pike, Blue Bell, Pa. 19422.

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Six steps to upgrading a kitchen without boosting the cost

Q. I'd love to move to a new home, but the economy is preventing that. So I've decided to do some kitchen remodeling, as it seems to be the center of activity of our current home. Based on the bids I'm getting, remodeling costs seem high. What can be done to keep the total cost as low as possible, as well as to minimize disruption? -Mandy W., Richmond, Va.

A. Kitchen remodeling can create financial stress as well as friction in your personal life. Most people simply don't grasp how much they use a kitchen each day, even if it's just walking to the refrigerator to get a glass of juice. Or they think nothing of walking over to the microwave and using it to heat up a cup of coffee. When those appliances are suddenly gone, life starts to imitate a deep-woods campground experience quickly.

Let's talk about the cost of kitchen remodeling first, and then I'll share some tips I've discovered after remodeling kitchens for nearly 35 years. There's no doubt that in the average home, the kitchen contains the highest concentration of fixtures, cabinets and appliances. When you add everything up, the dollar figure can be a frightening number.

If you want to keep the cost of your job as low as possible, I recommend that you keep your current cabinets and just paint them. That assumes the cabinets are in good condition. You'd be shocked at how dramatic the difference can be by just investing in a gallon of paint. Painted cabinets, especially ones that have some highlighting, can look gorgeous at the end of the day. You can save thousands of dollars immediately by deciding to paint instead of installing new cabinets.

I would watch for appliance sales if you're in the market for a new stove, refrigerator, cooktop or microwave. You will pay a penalty if you buy on impulse. Plan ahead and watch for sales. Scour the Internet for promo codes or rebate offers.

The odds are you may need to invest in new countertops and flooring. The plastic laminate countertops you may have shunned in the past should be considered. You'll discover many new patterns in durable plastic laminate that mimic the look of expensive materials that cost thousands of dollars more.

Don't reject affordable vinyl-tile flooring. Advancements in technology will amaze you when you see vinyl tile that looks like real slate, marble or granite. These are products you can install yourself in a day or less. That will save you sweet moola.

The disruption caused by remodeling needs to be minimized. I would not start the job until you have everything you need stored in your garage and double checked to make sure it's the correct item. Once you start tearing apart your kitchen, you should not be wasting valuable time driving around getting materials or making selections only to discover the thing you want will take three weeks to arrive.

Think about doing the remodeling job in warmer weather. If you decide to rip out your kitchen entirely, set up a temporary one in your garage where you can do basic tasks in relative warmth. Use an outdoor grill as much as possible, but do not use one in the garage. Fumes and the risk of fire are real threats.

If you're going to do some of the work yourself, practice the skills before you need to do the actual work. Discover if the paint you want will actually look good. Train yourself how to use additives in paint that will give you professional results. If you're going to paint your existing cabinets, go ahead and remove one cabinet front and paint it. When you get the perfect result, then advance to the rest of the kitchen.

-Tribune Media

Want free home-improvement information? Go to AsktheBuilder.com and sign up for Tim's free newsletter. Have a question for Tim? Just click the Ask Tim link on any page of the Web site.

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How to make rentals more attractive as the American dream evolves, adapts

Years ago at the University of Maryland, I taught "Economic Determinants in Architecture," an elective course introducing architecture students to the real world of capitalism and showing how that world influences design and development. Students learned that market and financial conditions, along with governmental fiscal and monetary policies, can profoundly influence what gets designed and built.

These lessons will be refreshed as government-backed mortgage funding provided by Fannie Mae, Freddie Mac and the Federal Housing Administration diminishes. The effects of more stringent underwriting standards - higher down payment requirements and lower loan ceilings -and tighter credit will ripple through the real estate industry, dampening home buying and construction. At the same time, demand for rental housing will increase, which means architects, including my former students, will have more multi-family projects to design.

Tougher mortgage financing standards are likely to slow creation of exurban, single-family subdivisions, which means less sprawl. While this is bad news for many homebuilders, it may be good news for smart-growth-minded jurisdictions. In areas well served by transportation infrastructure, counties and municipalities are crafting new master plans calling for development or redevelopment at higher densities with mixed-use buildings and lots of apartments. Examples in this region include Tysons Corner in Fairfax County; Potomac Yards in Alexandria; National Harbor in Prince George's County; the White Flint area in Montgomery County, and downtown Columbia, Md.

Rising market demand for rental housing is already a fact, the result of economic recession, rising unemployment, flat or falling home prices and more-conservative loan practices. For a growing portion of the American population, the probable reality is that conventional home ownership will be economically unfeasible and, with gradual or no appreciation in home value, relatively unprofitable. Increasing numbers of American households will rent.

But will this be detrimental to American society and culture, perhaps signaling the end of the American dream of home ownership?

Tomorrow's reality will not be a nightmare. Rather it will be the manifestation of a common-sense, rational concept disregarded during the housing bubble years: Homes should be bought and owned only by people who can sustainably afford to pay the full gamut of home ownership expenses, including mortgage principal and interest, taxes, insurance, utilities, maintenance and repairs. For others, renting will be the economically prudent and necessary choice. Yet it can be a desirable choice.

Rental desirability will depend on several factors:

l Favorable location and multi-modal transportation options within a community, including convenient access to good jobs, good schools, ample shopping, restaurants, recreation, entertainment and cultural facilities.

l Adequate housing unit size and layout. Rental dwellings must be conceived as "homes," with more apartments designed to accommodate families with children.

l Higher levels of aesthetic and construction quality. Apartment buildings and individual apartments must be commodiously planned with well-designed kitchens and baths, soundproofed walls and floors, ample daylighting, reliable elevators, well-appointed public spaces and attractive landscaping.

l Convenient, shared amenities such as parking, outdoor terraces and gardens, playgrounds, swimming pools and spas, meeting and exercise rooms.

l Affordable rents. Desirability will always depend on rental rates being a reasonable percentage of total household income.

Although somewhat affected by tighter credit, rental housing will be less constrained by changing mortgage finance practices because most projects are funded privately without government support. Unfortunately low-income tenants will continue to struggle, since their rents are made affordable through government subsidies. Regardless of what Fannie, Freddie or FHA do, public-sector budget cutting is likely to reduce housing subsidies and cause considerable pain for low-income families.

Destined to be more urbanized, America will increasingly resemble European metropolises, where renting a home is more commonplace and bears no social or economic stigma. For some of America's next generation of citizens, the American dream of home ownership, and more specifically of owning a single-family detached home in a suburban subdivision, will be less compelling and harder to achieve. This is why rental housing must become a desirable choice and not merely an acceptable necessity.

Roger K. Lewis is a practicing architect and a professor emeritus of architecture at the University of Maryland.

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Potomac Crest: Montgomery's garden spot

One of the first things you notice about Potomac Crest, a community of 131 townhouses and duplexes and 31 detached homes near Seven Locks Road and Tuckerman Lane, is the landscaping. "The overall community is beautifully landscaped and maintained by the owners and a very active homeowners association," said Debbie Cohen, a real estate agent with Long & Foster.

The community's focus on its trees, shrubs and flowers earned it an award of excellence for its landscaping last year from the Montgomery County Department of Transportation. Potomac Crest was one of 34 winners of the 24th annual Keep Montgomery County Beautiful community beautification awards.

It's not the first time, either. "We've won the award of excellence multiple times since 2000," said Janet Levenberg, who chairs the homeowners association's landscaping committee. Levenberg worked with the Brickman Group, a national landscaping firm headquartered in Gaithersburg, to execute the design.

Judges for the contest, run by the Keep Montgomery County Beautiful Task Force, are not easy to impress. "Most of the judges come from the National Capitol Area Garden Club Design Council" and are master gardeners, said the assistant head judge, Paula Knepper, who is a master gardener herself. Knepper said that Potomac Crest stood out.

Levenberg and her committee, including longtime members Buddy Schmidt (also the homeowners association's vice president), Inga Frank, Barbara Wilson, Judy Miller and Tony Liccardi, didn't have much to start with.

In the early days of the neighborhood, which was built between 1992 and 1996, the landscaping was adequate, but an afterthought.

Levenberg moved to the community in the late 1990s and saw immediate room for improvement in the landscaping. "There were berms everywhere," she said, referring to the common practice in new developments to bury construction material under dirt and ground-covering plants. "There seemed to be no pattern to the landscaping," Levenberg said.

Landscaping isn't the only thing that draws home buyers to Potomac Crest. Commuters like Potomac Crest's proximity to major driving routes, such as the Democracy Boulevard entrance to Interstate 270 two miles away. Most residents say they use their cars to get to work. For mass-transit commuting, "the only option would be a Ride On or drive to White Flint or Grosvenor and park," Cohen said, referring to the county bus system and the two nearest Metrorail stations.

Shopping options are very close but not pedestrian-friendly. Though Cabin John Mall is less than a half mile away, the multi-lane thoroughfares bordering the neighborhood usually cause residents to drive there.

Within the neighborhood, surrounded by large trees, there's a sense of calm. "The homes are handsomely designed, nicely positioned on each lot in harmony with the rolling hills from which Potomac Crest gets its name," Cohen said.

"I wanted a small, quiet neighborhood," said JoAnn Marceron, who moved into her townhouse in 2001. She was originally drawn to consider the neighborhood because of the architecture of the duplexes. "What appealed to me was that those were the ones with the garage on the main level. There are very few communities that have those," she explained.

Owner Tony Liccardi, who originally came to the D.C. area in the 1960s to work at NASA, bought his three-bedroom, 31/2-bathroom end-unit townhouse in 1995 for $500,000. "I really love the house. It was situated just right," he said. Over the years he's served on both the architectural and landscaping committees.

Suzanne Wilson found the neighborhood when a friend was looking for a house. She and her husband, Buddy Schmidt, bought their home before it was built and were able to choose some of the finishes. "We chose a slate walk, the black-and-white tile in the bathrooms," plus large custom closets, among other things, she said. Their duplex lies at the edge of a narrow strip of woods. Beyond the woods is a wide-open field below the power lines that stretch along the edge of the community. "We like this a lot," she said.

Many residents enjoy the wooded land next to the development, where they can walk along the mowed field where power lines run. Owner Inga Frank says she and many of her neighbors, especially those with dogs, walk along the power lines.

Schmidt believes the only downside might be when groups of deer take naps in his wooded side yard, because they make his dogs bark.

One aspect of living in a community with garages and no easy way to walk to shops or ride public transportation is that there is little daily casual interaction with neighbors. As a result, the committee work is a good way for residents to interact, as are the somewhat regular block parties, said Inga Frank.

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Fewer and fewer plants are truly deer-resistent

As early spring approaches, gardeners are thinking about their properties, and I've received questions about vehicular circulation, screening, controlling damage from deer and other topics.

In your column discussing plants that you like, shall I assume that the only one of those not endangered by hungry deer is the arborvitae that you said has no serious pest problem? Deer invade my front and back yards at will. - Ross Summers

Deer are pests that eat arborvitae, but green giant arborvitae is the only one that I've planted that has not been damaged by deer. They will taste it but apparently don't like the flavor. If deer are a problem, don't plant it unless you want to test the theory. Also, it may depend on the deer. The Bethesda herds where we planted giant arborvitae have not eaten them yet.

The plants listed in that article as most deer-resistant are conoy viburnum, switchgrass and green giant arborvitae. I have found that they will taste Virginia sweetspire but seldom do more than prune it lightly; however, the damage depends on how many deer show up for the tasting.

There are fewer and fewer plants guaranteed to be deer resistant. Perennials they don't like are hellebore, rohdea, dicentra, heuchera, astilbe, black-eyed-Susans, peony, monkshood, achillea, and virtually all ferns and herbs with a strong flavor. Deer-resistant trees are beech, birch, black locust, most maples, oaks and honeylocusts. Spruce is the only conifer on the "will usually not eat" list. There are others you will discover, mostly perennials.

The trees deer don't eat are still victims of rutting by bucks, which will cause the trunks to snap.

We have a federal-style home, built in 1799, set well back from the road on three acres amid another 284 acres of fields that belong to another family. Our home sits on a rise. We'd like to improve the entrance from the main road, create more of an inner and an outer yard and bring the driveway, which now leads guests to the back door, around in a small circle to the front of the house and add some landscaping. Can you offer any suggestions? - Joe Johnston

Your three-acre parcel surrounded by pasture sounds idyllic and has wonderful possibilities for landscape design. The lane to the house could be lined with one or two varieties of native trees. Choices could be alternating hophornbeams (Ostrya virginiana) and red maples (Acer rubrum). Another possibility is an orchard of apples, peaches and pears at intervals along the entrance drive (unless deer are a nuisance). You might consider a lane that would meander onto the property with views of the house appearing along the approach. This depends on whether the lane was established in 1799 and your interest is to keep historic accuracy or the line can be changed to follow the contour of the land, taking advantage of the house's location on a rise. Plant groupings along the way, screening and exposing views until you finally see the house and the entrance gardens, which could consist of boxwood, perennials or sweet alyssum edged with perennials and walkways between them. Behind the formal edged beds plant a taller mixed perennial and shrub border.

What yucca species (not false yucca or yuca) will survive in our area, including our occasional long bouts of rain and moisture? - Michelle Michlewicz

Adam's-needle yucca (Yucca filamentosa) would be the best one for the D.C. region. It grows in USDA Hardiness Zones 4 to 9 and is native to the eastern part of the country. It performs well in almost any kind of soil but requires a well-drained site. Yucca roots will not do well in wet or soggy conditions. The trickiest part of designing it in your yard is coordinating it with the other ornamental plants on your property. Plant this member of the agave family to stand as a sculptural element in the garden.

Have you ever done therapeutic gardening/landscaping for the disabled? - Andrea Brown

When I was a college student, I studied some horticultural therapy, which probably relates closely in many areas to the therapeutic gardening and landscaping for the disabled to which you refer. It is a gardening and landscaping discipline that can build a tremendous amount of self-esteem among the mentally and physically challenged. I structured an independent study course in the early 1980s titled "Fitness Through Horticulture" using the premise that there are benefits to be derived from gardening by all populations who practice it by encouraging flexibility and balance, producing our own food, gaining strength, burning calories and increasing quality of life. You can get more information on the subject through the American Horticultural Therapy Association at www.ahta.org.

I had a conversation with the Fairfax County compliance officer for telephone/cable about a downed telephone line on our street. He mentioned that all the pines planted along the utilities' right-of-way were a real issue. What is your opinion on planting trees under power lines? - Mary Adams Lafsky

Your question about planting trees under power lines is one that has troubled me and has been a problem for years. When our local historical society suggested locating trees on county property, the county would not allow it for safety. Trees should never be planted under power lines because they eventually grow over and through them. Neither trees nor shrubs should be planted on top of communication lines, such as telephone, Internet and television. Also, it is the law to call the Miss Utility line locator company at 811 before you dig for footings, fences, shrubs and trees.

I have a very thin group of established deciduous trees that serve as my only screen between my house and an adjacent house.We have two-acre zoning, so the houses are not directly next to each other, but they are close enough that more privacy is desired. I would like to augment the existing trees with landscaping within the narrow strip without damaging the existing trees. - Tom Marshall

You have a number of options for screening between properties. Since you already have the deciduous trees, design a mix of conifers. It seems to me that a two-acre lot would have enough space between homes to plant several columnar or pyramidal evergreens mixed with the deciduous trees. Two that come to mind are Yoshino cryptomeria (C. japonica 'Yoshino') and green giant arborvitae. If your screening trees get at least six to seven hours of sun, you might be able to fit spruce trees with a narrow growth habit along the border. Serbian or Oriental spruce will grow into good screens. Before planting, ascertain mature size of the evergreens and space them far enough apart to allow room for them to grow together. Stagger them to give a natural appearance and place then strategically to offer screening where it's needed.

Joel M. Lerner is president of Environmental Design in Capitol View Park, Md.

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Smart growth bill capitalizes on Maryland transit

The Maryland General Assembly may soon make a really smart move toward achieving really smart growth: It could adopt proposed land-use legislation enabling "State Rail Station Overlay Districts."

House Bill 948 would empower local jurisdictions and the state to plan for and permit increased density and more diverse uses within designated areas around rail stations throughout Maryland.

If enacted, the Maryland Department of Planning, in consultation with the Department of Transportation, would collaborate with counties and municipalities to delineate rail-station overlay districts and to make new master plans, design guidelines and development regulations for them. The new plans and regulations would supersede existing zoning, replacing out-of-date concepts and regulations that obstruct desirable, sustainable development.

The SRSOD bill's most basic goal is to foster vibrant, pedestrian-oriented, energy-efficient communities centered on transit. Overlay district development, at appropriately higher densities with mixed uses, would be located within reasonable walking distance of Maryland's rail stations. Of course, what constitutes reasonable walking distance will depend on the agreeability of the walk.

Another laudable goal articulated in the bill is to improve public services and the aesthetic quality of the public realm - streetscapes, open space, civic amenities, architecture - within overlay districts. The bill sets forth urban design aspirations and outlines strategies for financing them. It envisions establishment of dedicated county or municipal amenity funds with revenues derived from state and local allocation of density rights; from taxing private transfers of density rights, and from special SRSOD taxing districts and bonds that would be paid off by new sales tax revenue.

A jurisdiction's amenity fund could pay for improving storm water management infrastructure, street landscaping and lighting, underground utilities, parks, plazas and playgrounds. Funds also could be used for preserving unique structures or protecting valuable natural features.

The SRSOD bill wisely recognizes that each rail station site is unique and that a statewide "one size fits all" planning approach would not work. Sites vary in historic and cultural character, surrounding physical and demographic conditions, vehicle access, topography, climate and economic potential, so planning and regulatory flexibility is essential. The legislation contains no prescriptive standards or quantitative criteria, only the requirement that jurisdictions establish them for each designated SRSOD site.

The legislation anticipates that jurisdictions will implement an efficient design review and development entitlement process. Qualified planning officials and design professionals would evaluate the functional, technical and, equally important, aesthetic quality of proposed projects.

Rational analysis and informed value judgments about urban design, architecture and engineering would guide development - instead of conventional zoning regulations that typically are mute about aesthetics. In fact, a rigorous- but fair and expeditious - review and permitting process motivates project sponsors and architects to strive harder to achieve design excellence.

It seems fitting - and long overdue - for Maryland to enact this smart-growth legislation. After all, the term "smart growth" was first coined in Maryland. Neither a fad nor a political ideology, smart growth is simply shorthand for prudent, sustainable land use and transportation planning guided by principles that planners today universally embrace:

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Concern grows over use of flame retardant HBCD

Hexabromocyclododecane, commonly known as HBCD, is a flame retardant that is starting to give a lot of green builders headaches.

Many people have never heard of this chemical compound, used in polystyrene insulation, but it could be in your house. Indeed, you are likely to be carrying some in your body.

This flame retardant has been found in human breast milk, body fat and blood. In the United States, "everyone has it in their tissues. In Europe, where HBCD is more widely used, the exposure is higher," said biochemist Arlene Blum, executive director of the Green Science Policy Institute and an expert on brominated and chlorinated flame retardants.

Not only is HBCD found in human tissues, but it's also found in wildlife and aquatic organisms all over the globe. In the United States, HBCD is carried through rivers and streams to the coasts, where it comes to rest in ocean sediments and enters the food chain. The highest levels of HBCD recorded to date were found in sea lions that were feeding on clams, shrimp and other bivalves off California, Blum said.

The Environmental Protection Agency and the European Chemicals Agency have said HBCD persists in the environment and does not break down into safer chemicals. It is toxic to aquatic invertebrates. According to EPA's HBCD Action Plan, released in 2010, "It also presents potential human health concerns based on animal test results indicating potential reproductive, developmental and neurological effects."

The European Union announced in February that HBCD is one of six substances of "very high concern" that "will be banned within the next three to five years unless an authorization has been granted to individual companies for their use." These substances "cannot be placed on the market or used unless authorization has been granted for a specific use."

How has HBCD become so widespread? Environmentalists have said the most likely primary source is emissions that escape during its manufacture or after it is applied as a flame retardant. Because HBCD is not chemically bound to the material it protects, it will eventually escape into the air, said Alex Madonik, a chemist with the Green Science Policy Institute.

But, Madonik said, in 2008, when the European Chemicals Agency determined that HBCD was a "substance of very high concern," it also concluded that when HBCD is used in insulation, its predicted exposure is low. For this reason, European polystyrene insulation manufacturers might request authorization to continue using HBCD. But even if this is granted, Madonik said, "they will be strongly encouraged to develop alternatives."

What is EPA's position on HBCD? Despite efforts to get precise information from its Office of Pollution Prevention and Toxics, I did not get answers. But EPA's Action Plan states that it is "considering initiating rulemaking" that "could take the form of a comprehensive ban" or "a more targeted regulation to address specific activities." EPA "intends to publish a notice of proposed rulemaking by the end of 2011," it said.

All this raises an obvious question for American homeowners and green home-builders: Is it okay to use materials containing substances that raise havoc with the environment and increase the chemical burden in everyone?

There are no easy answers.

Polystyrene insulation is favored by green-home builders because it creates an extremely energy-efficient building envelope. Reducing home energy use is a cornerstone of green building because it helps to cut greenhouse gas emissions. Home energy use accounts for about 20 percent of the greenhouse gases emitted by the United States every year.

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Thorny foreclosure questions

I never bought a foreclosure. I pay my mortgage faithfully. Now, is someone going to tell me a back-office clerk mishandled my title and their actions threaten my legitimate ownership? Will this mess hurt me when I try to sell my home?

That's exceedingly unlikely. Chaos would ensue if the millions of solvent homeowners who purchased their home - or refinanced their mortgage - in recent years had their ownership thrown into question. Even if investigators conclude that land titles have systemically been registered improperly as the associated mortgages were carved up into mortgage-backed securities and sold to investors, government would be compelled to avert such chaos by legislating a fix to the system.

And then there's the less-theoretical assurance provided by title insurance. Lenders require all borrowers to pay for a policy at closing. This protects the lender if there is a ownership claim against the title. (That's commonly called a "cloud" on the title.) Borrowers can choose to pay extra to have that coverage extend to them as well. Title insurers promise to pay legal expenses to defend a title - or to compensate owners if they lose such a challenge.

So, does that mean the foreclosure problem doesn't affect me at all?

It may not affect you directly, but the fallout could. If nearby foreclosures remain empty longer, or if buyers avoid bidding on foreclosures, your home value could deteriorate. Condominium-unit owners could face higher dues and special assessments if foreclosed units are not bought by dues-paying new owners. Existing condo owners also could have trouble selling their units because lenders refuse new mortgages at complexes that already have too many defaults.

More broadly, a prolonged halt to foreclosures could further damage the economy and the financial system, delaying the day when economic recovery gains real traction.

My bank says it is going to foreclose on my home. Is there any way to determine whether my documents were mishandled - and keep my home?

You need the advice of a lawyer who is expert on the foreclosure laws in your state. However, you can at least examine all the documents related to your home purchase and mortgage, dating from your loan closing to default and foreclosure notices, to look for errors and discrepancies. Are details such as account numbers, loan amounts, payment amounts, addresses and legal jurisdictions correct? Bring any errors to the attention of your lawer, who can advise you whether they will help you challenge the foreclosure.

I'm planning to buy a home. Will the foreclosure problem complicate things?

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Do-it-yourself Q&A

Q. The bathroom grout in our 14-year-old house has become stained, and we haven't been able to clean it with various products, including bleach. How do we restore the color? -D. Lilly

A. Bathroom grout can pick up several difficult-to-remove types of stain, including minerals from hard water, soap scum, mildew and mold. Grout cleaners generally help, but the method of cleaning is often as important as the cleaner. It often helps to spray on the cleaner, let it work for several minutes, then scrub with a soft brush. Regular household cleaners such as Mr. Clean or Simple Green sometimes work well. Some home owners swear by oxygen-type bleach, not chlorine bleach. Others prefer special tile cleaners such as Tilex or Kaboom. When just cleaning doesn't work, a good option is to dye the grout, restoring either its original color or picking a new color. You can find grout dyes at some ceramic-tile dealers, and the Internet has many sources. One source, groutrevive.com, offers a grout-coloring kit ($43) that includes a pre-treatment, colorant, applicator brush, gloves and other materials. Available colors include white, black and several shades of gray. Cleaned or newly colored grout will stay that way longer, and be easier to clean, if the grout is coated with a sealer. Grout sealers are available from tile dealers or on the Internet.

Q. Our builder used polystyrene foam panels to insulate the ceiling over the crawl space below our kitchen addition. The floor still gets quite cold. If I remove the foam and staple high-R batt insulation between the joists, would it help? -A. Francese

A. It depends on the thickness and type of the polystyrene insulation used, but there is a good chance you can improve the insulation in the crawl-space ceiling. Polystyrene panels have insulating values ranging from about R-3.5 to about R-5 per inch of thickness. Panels two inches thick would give an R value of no more than about 10, which isn't enough for floors in even warm-climate regions, where R values of R-13 to R-19 are recommended for retrofitting floors in existing homes. In cold climates, R values of 25 to 30 are recommended. You can achieve high R values with fiberglass insulation tucked between the joists of the crawl-space ceiling, although you might be limited in the thickness of your insulation by the depth of the joists. Fiberglass insulation can be held in place with lengths of stiff wire jammed between the joists under the insulation; the wires are sold by insulation dealers. You don't mention the floor of your crawl space, but it should be covered with a layer of thick plastic sheeting to help keep moisture from migrating into the crawl space. Hold the plastic in place with bricks or stones.

Q. I cleaned my vinyl siding with a mixture of three quarts of warm water, one quart of chlorine bleach and one cup of TSP. It did a great job on the siding but left white stains like water drops on the window glass. Windex didn't remove the spots. Can you help? -Tom

A. I think that cleaning solution was too heavy on the bleach and TSP (trisodium phosphate). TSP is a very powerful cleaner, and that much bleach shouldn't be needed even if the siding has some mildew stains. A cup of bleach and a quarter-cup of TSP in a gallon of warm water might have been better. A soft brush is the best applicator, but it sounds like you used a sprayer of some sort. In any case, it is a good idea to protect windows by taping plastic sheeting to the frames. You should also rinse the surface with clear water as soon as possible.

It is possible that the glass has been etched by the mixture, but you can try this cleaning method. Test it first on a few spots in the corner of one of the window panes. Get some very fine (4-0) steel wool and soak it in Windex. Rub the stains gently at first to make sure you are not scratching the glass.

If the stains soften and come off, rinse the test area and check again for scratching. If all is well, proceed with the remaining stains. If Windex doesn't work, try the steel wool and a couple of other solutions - a quarter-cup of ammonia in a quart of warm water or a 50-50 mixture of white vinegar and water. Caution: Don't try mixing ammonia and bleach; it generates a dangerous gas.

Questions and comments should be e-mailed to Gene Austin at gaus17@aol.com. Send regular mail for Gene Austin to 1730 Blue Bell Pike, Blue Bell, Pa. 19422.

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Borrower has second thoughts about that second chance

Q. I was going into foreclosure, but the bank gave me a loan modification. I agreed to the modification at the beginning, but now I see it was a mistake and think foreclosure would be better. What do I have to do - just stop paying?

A. A quick answer to your question is yes. If you stop making your payments, the lender will certainly reinstitute the foreclosure proceedings to sell the home and satisfy all or part of the debt you owe.

The whole loan modification process has been a nightmare - not so much for the big-box lenders but for troubled borrowers. The government held out the promise that loan modifications would help people save their homes. But it was far from the truth. At first, lenders were overwhelmed by the volume of applications and lenders took forever to get through the files. Borrowers were given the impression that they would be considered for a loan modification if they met a certain minimum standard and were granted a trial loan modification.

Those trial loan modifications were anything but a trial. Borrowers were told to follow the lenders' instructions, pay a certain amount and wait for a response from the lender. However, what the borrowers got was months on hold waiting for lenders, lenders that reported those same borrowers - whom they claimed they wanted to help - to the credit-reporting bureaus as either delinquent on their loans or as paying less than required.

Those same borrowers were being hurt by the system that was supposed to be helping them. Borrowers who had stellar credit histories and credit scores soon found that their trial loan modifications had hurt their credit scores so much that they would be unable to qualify for a traditional refinance because of their participation in the government-sponsored loan modification program.

Recently released statistics indicated that only a small number of people who applied for loan modifications actually received a permanent loan modification.

Those who did not receive a permanent loan modification and were bounced from the trial loan modification received a rude awakening. Their lenders told them they would, at once, have to cough up the money to bring their loans current, even though the borrowers had paid the amounts they were told to pay during the trial loan modification. Now those same borrowers faced a higher chance of foreclosure than before their participation in the loan modification plan.

Decide for yourself whether you should make any more payments to your lender.

You might want to get a copy of your credit history from annualcreditreport.com to see how the loan modification has affected your credit history. You can download a free copy from each of the three major credit reporting bureaus at this site. The site will also offer you a copy of your credit score for about $8.

You might find this information helpful in seeing where you stand now, what impact a foreclosure will have on your future credit history and score, and what you will need to do over the next several years to restore your credit.

Q. I purchased a beach property in North Carolina with a friend a couple of years ago. We put down 10 percent and financed the rest. We thought we could sell the property quickly, but we were wrong. The co-owners have been having financial problems and stopped paying their share of the mortgage, taxes and insurance about two years ago. Since then, they have been paying the utilities and I've paid everything else.

Renting it out covers about 60 percent of the expenses, but we lose money on the whole. Our property is about 20 percent underwater.

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Color of Money Live

Need advice about how to handle your personal finances? Post columnist Michelle Singletary offers her advice and answers your questions.

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Michelle Singletary: Just finished my video chat. Hope you view it later. Got lots of questions so let's get started.

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Thanks for your advice!: I printed out the payoff for my husband's car today and am mailing in the final payment. We've paid off my car and all of our credit cards in the past year. We still have my student loans and a mortgage, but we are definitely moving in the right direction. It feels soooooooo good.Thank you for your wonderful advice. It has been incredibly helpful. :)

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College Loans: I'm starting graduate school in the fall and need to borrow a chunk of money. I've done all of the FAFSA stuff and am waiting for a reply. I'm starting to get a little worried and wonder if I should contact a private lender now. (I paid out-of-pocket for undergrad so I don't know how this stuff works.) I've got 6 months until I start school and wonder how long I should wait for a reply before I take my own action. What say you? Thanks!

Michelle Singletary: Would you kill me if I said you need to wait?You paid cash for undergraduate, why not continue that trend and stay out of debt?

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Student Loans - PAID OFF!: Good Afternoon! I have already received my tax refund (Federal and D.C.) and used it to pay off my student loans. They were basically 0% interest but I paid them off in 8 years instead of 10. I'm so excited! I'm taking a combination of tips I've read in this chat and set up automatic transfers into various accounts (new car, savings and Roth IRA) that total the amount of what my student loan payment was each month. I even set it up for the same day, so that I will not go a month without seeing a withdrawal on that date. I'm saving for a new car (one of the accounts) and hope to not finance more than $10K (assuming the current car allows that....) of the purchase price. I'm almost 32, SINK and feel like this will be my best financial year! Thanks for all the great tips you provide!

Michelle Singletary: Oh my, I'm so very proud of you. Say, you deserve one of my debt defeater tee-shirts. They are free, well free if you send me your story to colorofmoney@washpost.com.I just highlighted a debt defeater in my live video chat. So come one one of my club members.Again, congrats. I know it feels great to get that student loan monkey off your back. And your savings strategy is right on the money!

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Michelle Singletary: Don't worry, Jim is here. Just having some computer problems. I'll start posting his answers to your questions in just a bit. I think it's the rain!

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Please, what next?: Michelle, I've been reading your columns and chats for years, and I agreed with so much of your advice that I followed most of it. Now I'm 37 with no debt, a paid-off house, a maxed-out 401(k) every year, and enough savings to live on for several years if I needed to. My husband and I are not having kids, so the only things we're really saving for are elder care for my parents and our own retirements. I am having a terrible time figuring out what to do next, and I don't remember ever seeing you cover the next steps. Do you have any columns that cover what happens once you're financially secure and just accumulating savings? Are there any books you can recommend? Safe things like CDs have a godawful rate of return, the stock market is frighteningly volatile, and real estate investments don't seem much more secure. Any advice you can give would be appreciated. (Text chat only please, if you respond. I don't know if you pull from the text chat for your video.)

Michelle Singletary: What's next?Rejoice. Running in the streets.Seriously, you are in a position few people are. So what's next is really what else you want to do with your money -- more charitable giving, helping other family members (any niece or nephews piling on college debt). Once you decide what you want to do with the money, the you decide where to invest it or whether to invest any more money.

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Amended return: After filing my 2010 taxes last month and receiving a refund, I realized I'd forgotten something...extra income, which means I need to pay the IRS. How much time do I have to do an amended return? Does that need to be done by April 18 because I now owe money?

James Dupree: You are correct. Filing an Amended return on IRS Form 1040X will prevent late filing penalties and interest if filed before April 18.

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Refinancing student loans: This isn't a tax question, but I hope that you answer it. I used my income tax refund to pay off my credit cards, and I now want to refinance my student loans, which are at 8 and 10 percent. How long after the credit card payments will my credit score be adjusted, such that I can reap the benefits on the refinancing?

Michelle Singletary: The answer to that question is a mystery. The credit scoring companies won't really say. But you should see a jump in your credit score within the next several months. The card companies report to bureaus regularly so once the card company systems update for your payments that will be sent to the bureaus.However, I'm not sure a higher score will result in your being able to get a loan to pay off those student loans. You would have to get a personal loan and if you owe a boat load of money that will be difficult in this credit market where companies are very reluctant to make such loans.

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Energy Tax Credits: We put in a new efficient water heater and washer and dryer and new electrical panel in our second home last year? Can we apply that to the energy tax credits?

Michelle Singletary: Here's what the IRS says about this credit:Nonbusiness energy property credit. This credit, which expired after 2007, has been reinstated. You may be able to claim a nonbusiness energy property credit of 30% of the cost of certain energy-efficient property or improvements you placed in service in 2010. This property can include high-efficiency heat pumps, air conditioners, and water heaters. It also may include energy-efficient windows, doors, insulation materials, and certain roofs. The credit has been expanded to include certain asphalt roofs and stoves that burn biomass fuel.Limitation. The total amount of credit you can claim in 2009 and 2010 is limited to $1,500.You can find a nice list of qualifying home improvement equipment from the EnergyStar web site. Before you take the credit be sure you qualify.

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settlement money: I received a large settlement for physical injuries from a traffic accident in 2010. Should I put down the settlement figure as income on my income tax form?

Sarah Halzack: From James Dupree:Physical injuries or physical sickness settlements are generally non-taxable. If you receive a settlement for physical injuries or physical sickness and did not take anitemized deduction for medical expenses related to this injury in prior years, the full amount is non-taxable and generally does not need to be reported on your income tax return. If you receive a settlement for physical injuries or physical sickness and did deduct medical expenses related to the injury, the tax benefit amount is taxable.

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Child Care Tax Credit (CCTC): Is there an income limation for the CCTC? Can parents with joint custody get credit for their respective payments even during the years when the child is not claimed as a dependant?

James Dupree: The child must be claimed as a dependent on your return and lived with you for more than half of 2010.

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Yikes!: I'm freaking out! I need to save a large amount of money in a small amount of time ($2000/6 weeks). My salary is not huge. I have a student loan and hardly ever use my credit card. Any mantras to help get through? Thanks sooo much.

Michelle Singletary: But I know freaking out won't help the situation.

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W-4 Federal Withholding Tax Information: Michelle... I recently changed my W-4 withholding number from 2 to 4... From my understanding, will this number increase the amount of money I bring home during the year and decrease my annual tax refund? Although I do like to receive the refund, I am more interested now in bringing home more money during the year versus getting a big refund...

Michelle Singletary: To really tell what the change will do, you should get help from a tax professional or walk thu your tax return with the higher withholdings. Don't just guess.

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Debit card not the same as cash?: In Wednesday's column, you briefly said that using a debit card is not the same as cash. Can you elaborate? Any links/resources would be great too. Thanks!

Michelle Singletary: In the battle over swipe fees, consumers will lose

Michelle Singletary:

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Taxes - refunds, children, etc.: I am curious - every year we file our taxes (we have 3 minor children), are homeowners (mortgage holders), both work full-time, use the Flexible Spending Accounts, one of our children is in Pre-K, about to start Kindergarten. We know people who pull in $10,000 tax refunds. We are not those people. We have tweaked our W-4 each year and it never comes out "a wash" - we owe nothing, we get no refund. Are we calculating incorrectly? Or is this just something we have to learn to live with? I would love to neither owe or gain at tax time. Just file and be done with it. If we get a large refund, I think "we left $ with the gov't all year". If we owe, that just hurts. NOTE: The last few years, hubby has gotten laid off and collected Unemployment - requested no taxes be taken out - so we have to pay them at tax filing time. If he had the taxes taken out, it would eat into an already smaller paycheck. Then, he is called back to work and we go on through the year. THANK YOU!!!!

James Dupree: Form W-4, Employee's Withholding Allowance Certificate to avoid having too much or too little Federal income tax withheld from your pay. You can use your results from the calculator to help fill out the form.

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Worth it to Amend?: Is it worth it to amend three years of prior filings if it nets us about $800 per year but my spouse (gay couple filing single with federal) will not only have to pay back $4000 in refunds per year, but also owe the government about $2000 per year in taxes? We had two houses for the past 3 years and each of us claimed one house in our taxes. However, I make more money than my spouse and just learned this tax year when we sold one house that we would have received $800 more per year in refunds if I had claimed everything. Is there a way we can figure out if it's worth it to amend? For instance, what, if any, interest my spouse would have to pay on (1) the $4k he received each year in tax refunds; and (2) the$2k he would owe each year? Can we do this without raising audit suspicions? I'm thinking it's not worth it - live and learn - but the frugal side of me wants to do the calculations. Do you think it's worth it?

Michelle Singletary:

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debit cards: Hello Michelle! I have to disagree with the idea that *I* am addicted to my debit card - I use it just as I use cash, except that I don't have to carry as much cash in my wallet or deal with personal checks. For me, it makes my life so much easier. And I have yet to bounce any transaction!On another note, I followed your advise 3 years ago and had my credit card debt negotiated with MMI. I'm still on the program and was able to pay one of my credit cards off today! Several more steps left to go, but I am closer to being debt free today than I was 3 years ago. Thanks!

Michelle Singletary: Perhaps addicted was too strong a word but the fact that people can't imagine operating without it suggest a strong attachment to this form of payment. I have counseled a lot of people who think they are doing just fine using debit and not cash. But they are also overspending because they don't see all the cash going out of their account. There is something about having to hand over cash that gives your brain a signal that money is being spent. That is my point.And good for you for taking care of that credit card debt.

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Coming out a "wash": You'll never be able to get your withholding to exactly match what you owe. You can minimize the difference, so maybe you get a $53 state refund and owe the Feds $102 (or vice versa), but it will never come out even. There are too many variations throughout the year--your mortgate interest deduction goes down slightly every year as you pay off your mortgage, your property tax rate changes, your charitable contributions vary, etc.

Michelle Singletary: Thanks. I think this will help folks understand.

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Question for Jim Dupree IRS rep...: I'm embarrassed to ask my local IRS person this...I'm on a payment plan for my taxes. Has anyone ever requested to have their wages garnished? I take extra out of my paycheck every month to pay the next year's taxes anyway...seems like I could do the same for taxes that I currently owe.

James Dupree: Payment by credit card via phone or Internet, orhttp://www.irs.gov/pub/irs-pdf/f2159.pdf

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Student loan interest: My daughter graduated from college in 2010. She is now getting the bills for student loans, but is applying for Grad school. I told her I would pay the undergraduate loans while in Grad school. Since I am a co-signer on the loans, would I be able to claim the interest on my taxes or can only she claim this? Thanks.

James Dupree: http://www.irs.gov/publications/p970/index.html

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to retire or not to retire?: Hi Michelle, love you and your chats. My husband and I are in our early 30s, with secure and stable careers. We both have 401(k)s that are worth less than 100k right now and a life insurance/investment program that will pay dividends when we turn 55. We used to have a Roth IRA accts, but have less than 10k in there because we no longer qualify with our incomes. At this point, I feel like we're not doing enough for our retirement. Should we open a regular IRA? Contribute more to our 401k instead of just matching? What should we do more to ensure a better retirement fund? Thank you.

Michelle Singletary: Go to www.choosetosave.org. There is a ballpark retirement calculator that will help you figure out if you are saving enough for retirement.

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Re Yikes: Saving money is a slow race, not a fast one. Is the 2k a want or a need? It is something that you can put off a couple of months? Do you already have a budget in place?

Michelle Singletary: Good questions for the person trying to save. I figured it was necessary otherwise why the rush.

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Re: What next? : I know what I want to do with the money - use it to try and retire earlier, and be as comfortable as possible during retirement. (We already donate to charities every year and help out our families.) So now how do we figure out where and how to invest? Is it just time to move beyond the limits of your advice and find a financial planner?

Michelle Singletary: Probably. The important thing is to figure out how much income you want in retirement and then figure out if you have that already and if not where can you/should you invest it to meet your goal. That, I'm afraid, is not something I can do for you.

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Paying it off!: Michelle -- We just paid off $15,000 in credit card debt over the past two years (hooray!!). Nice feeling to have that behind us. Now -- what do we tackle next? Between my spouse and me, we have $75,000 in student loans with interest rates between 1.85% and 2.25% and we have $51,000 in a second mortgage with an interest rate of 9.25% (I know, I know ... big mistake ... no need to get into that. What's done is done). We can't refinance the second mortgage as the house is underwater. Many thanks.

Michelle Singletary: In this case your lowest debt is also the debt with the highest interest rate so I would aggressively go after paying off the second mortgage. And I agree, what is done is done. I don't typically lecture folks when they've made a mistake UNLESS they are in denial. No need to kick a debtor when he or she is already down (smile).

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Paying attention: You are a clarion call for consumers to pay attention to those transaction fees, debit card debits, service charges, bag taxes and the creeping cost, often cent-by-cent, of living.I used to shrug off the complicated Pepco bill, Comcast charge and the more than occasional "I don't what that $3 is for but it's not worth fighting about" fee from some company and just write my check or click pay. No more. I'm being taken; and if I don't stand my ground, no one else will.I'm looking at my bills. I'm looking at how and when I pay them. I'm looking at what is necessary or luxury. (E.g., ATM fees? No, thank you.)Appreciate your column. Keep up good work. And in what ways do you think most households miss ways to save money?

Michelle Singletary: And really it's food that bust many people's budget. They don't pay attention to the extra they spend in the grocery store and eating out. Second is transportation. Second biggest item in people's budget because we can't hold unto our cars. Got to upgrade all the time.

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Estate Tax Audit: Hi, this question is for Jim. I am the personal rep for my father's estate, and the IRS is auditing the 706, which is not unexpected. We really cannot afford the attorney who prepared the return for help with the audit, as he would charge $14,000 for the initial response to the auditor's request for information. Am I crazy to think I can handle this on my own? I already have all the information compiled, but is the IRS auditor out to try to find more tax come hell or high water? Or does the auditor really simply want to make sure we're paying the correct amount of tax? We took a discount on the property where my father lived because he was murdered there (per the advice of the attorney). So my fear is that the auditor will not allow this, even though we have multiple offers on the property which were withdrawn specifically because the buyers learned of what happened there (and we have that reason in writing from buyers). Thanks!

James Dupree: I can assure you, the IRS Auditor's job is to make sure you are paying the correct amount of taxes due, if you have to pay.

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Deadline for 1099 MISC Income form?: I have a full-time job and also do some freelance work. One of my clients still hasn't gotten me my 1099. Claims to have mailed it two weeks ago. They finally sent a pdf so I can finish my taxes. But this has happened before with them. Client is actually fine, it's the accountant who has worked for them for years who is remiss. And has been so in the past (missed W4s, 1099s, late payroll).Is there an IRS deadline by which I should have received the form from the client and if so and accountant missed it, can I report him to the IRS?Thanks.

Michelle Singletary: Here's a good article on this on ehow.com since I don't have a lot of time. There is a deadline, Jan. 31 I believe.http://www.ehow.com/info_7839914_companies-required-mail-w2-forms.htmlIf a company does not furnish employees with correct W-2 forms by the deadline, does not receive an extension and cannot show good cause for the delay, it may be penalized by the IRS. But just so you know, it's possible the company will be penalized not the bad accountant.

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MFJ on 1040a: What forms do I use if my spouse died in April of 2010? I always use 1040a and we always filed jointly.

James Dupree: For more information about each of these filing statuses, see IRS Publication 501: http://www.irs.gov/publications/p501/index.html

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Michelle Singletary: Hey, I know we didn't get to as many tax questions as I had hoped. Computer issues. But I'll get Jim to answer some leftover questions and either print them in my Post column or in my eletter. So if you don't subscribe to the eletter please do.Thanks for joining me today.

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Military buyers: Home-shoppers on a mission

To those who haven't worn the uniform, their ways can be a mystery. But anyone trying to sell a home in the Washington metro area would be wise to learn more about the needs and habits of military officers, enlisted people and their families. It's the season for them to begin some serious house-hunting.

The D.C. area is home to more than a dozen major military bases, and thousands of service members and their families move in and out of the region every year.

Across the services, transfers frequently take effect in June or July. "Starting in March, April and early May, there's really a strong demand for military families transferring into the area," says Greg Wilson, a retired Navy officer who owns RE/MAX Riverside in Occoquan, which specializes in military relocation. "They start looking online in March and are generally here in April and May to visit the houses in person for a July move, especially the spouses. A lot of times they have less than a week to come to the area and look at homes," he says.

Military households tend to move every two to four years, often with little notice, and usually arrive in the D.C. area with sticker shock, despite access to a tax-free housing allowance and special government-guaranteed mortgages with little or no down payment required. Often they base their price range on the Department of Veterans Affairs loan limits and monthly housing allowance - important numbers for sellers to keep in mind when pricing their homes. In most of the Washington area, the VA loan limit is $818,750. (In some areas close to Fort Meade, the limit is $500,000.)

And there's an added incentive for some service members to buy this spring: The $8,000 first-time home-buyer tax credit expired for most people last year, but service members (as well as members of the Foreign Service and the intelligence community) who were stationed outside the United States for at least 90 days between Dec. 31, 2008, and May 1, 2010, have until April 30 to enter into a binding contract and until June 30 to close on a property and qualify for the credit.

Lt. Col. James Gifford, an Air Force pilot, has plenty of experience with fast and frequent moves. He was stationed in England with the 494th Fighter Squadron before being transferred to the Pentagon in 2003. "I was coming back from overseas with two little children - my daughters were 2 and 3 years old - and had just 10 days to find a new home," he says.

As he was preparing to leave England, a buddy in his fighter squadron told him about Wilson, who helped him find a townhouse in Springfield. Just two years later, in 2005, Gifford was transferred to Enid Air Force Base in Oklahoma. He sold his Springfield home for a $100,000 profit. "It was complete luck," he says. "The market was so crazy good at that point."

After five years in Oklahoma, Gifford was about to be sent to the War College in Carlisle, Pa., when his assignment was changed to the Pentagon at the last minute. He had just one month to find a home in the D.C. area before his June 2010 transfer date.

His wife, Cindy, started looking at properties on the Internet and found 30 good prospects, then narrowed the list to 10 based primarily on price range, commute and the school district for their daughters, now 10 and 12.

Cindy flew to D.C. and she and Wilson visited her top 10 homes and picked her favorites. But soon after she returned to Oklahoma, someone else put an offer on her favorite, a four-bedroom house in Woodbridge. The Giffords quickly made an offer on the house, and it was accepted - all before James had a chance to travel to Virginia to see any of the houses.

Gifford knows he will be transferred again, in July 2012, but he would like to keep the house for at least seven or eight years before selling, and he hopes to return to the D.C. area in the future. This made him conscious of the rental market when calculating how much house he could afford and how much of a down payment to make.

He based his calculations the way many military households do: He looked at the housing allowance for an Air Force lieutenant colonel with dependents ($2,880 per month), knowing that would probably be the rental budget of a similar officer moving to the area. Then he subtracted about $300 per month for utilities and management fees when calculating his target monthly payment. This way, he knew that he would be likely to get enough rental income each month to cover his mortgage payment and carrying costs.

If you'd like to attract military buyers, it's important to keep those housing-allowance numbers in mind when pricing your home. The Basic Allowance for Housing (BAH) varies by rank, location and number of dependents. The amounts are available by using the Department of Defense's calculator at defensetravel.dod.mil/site/bahCalc.cfm.

A major in the Army, Air Force or Marines, or a lieutenant commander in the Navy with dependents in the D.C. area (including suburban Maryland and Virginia), receives $2,739 per month and often looks for a house with monthly payments that equal the BAH.

Showing prospective buyers that there is a strong rental market in your area is also very important. Many service members plan to rent out their homes if they are transferred after just a few years, especially if they expect to return to the D.C. area at some point. "In the Fort Meade area, we have seen a huge boom in the rental market," says Laura Roskelly, a real estate agent in Millersville who spent four years in the Army and traveled with her Navy husband for 16 years. She now specializes in military families buying properties in the Fort Meade area.

Home prices and reasonable commute times tend to be very popular with military families. "I find that many military families that are relocating to Fort Belvoir usually start their search in Lorton, which has a short commute to Fort Belvoir," says Sarah Phelps, an agent with Ron & Susan Associates with Long & Foster in Lorton.

"Most of the Quantico military transfers I help purchase are buying homes in Dumfries, Stafford and sometimes as far south as Fredericksburg," she said.

Wilson finds a lot of families interested in Burke, because it has good schools and easy access to Fort Belvoir via the Virginia Railway Express.

Roskelly says many people stationed at Fort Meade are buying or renting in Annapolis, Severn, Odenton, Gambrills, Crofton, Piney Orchard, Severna Park, Arnold, Columbia and Ellicott City.

Most military households, like home buyers in general, begin their search on the Internet. MilitaryByOwner.com tends to be popular because it makes it easy to see information about houses available for sale or rent near military bases. "It's a great place to advertise your home to military people coming into the area," Wilson says. He recently listed a client's home in Manassas for rent for $2,850 per month, "and within an hour, we had four serious inquiries." The house was rented in just three days.

Simply including the name of a nearby base in any home listing on the Internet can help attract prospective buyers. For example, Roskelly's Web site, FortMeadeHomes.com, makes it easy for buyers throughout the country to find listings in communities near the base. "Think like a relocating home buyer and what search terms they would probably use to find a home near the base," she says.

Also highlight services available at the nearby base - such as the new 120-bed Fort Belvoir Community Hospital, which will be replacing a much smaller clinic on the base and no longer requires families and retirees to travel to Walter Reed Army Medical Center at the northernmost tip of D.C. or to Bethesda for a lot of their medical care.

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Diner’s Journal Blog: What We’re Reading

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The family focus endures in Montgomery's Sherwood Forest

The Victorian house in the center of Montgomery County's Sherwood Forest neighborhood has overlooked the surrounding land for more than 200 years. Back in those early days, it lay just off the Glenmont-Colesville Road in the midst of Westover Farm, where crops such as corn and oats grew on nearly 300 acres.

Now, the house is encircled by Colonials, split-levels, ramblers and an elementary school. Families arrived more than 50 years ago, after the farm was sold in pieces to developers. But Richard Curtis, whose family owned the land, kept 10 acres, including the house at the center of the property, and moved there to raise his own family in the late 1950s.

Curtis, a former Navy pilot, still lives in the house at age 92 and has watched a community grow where those rolling farm fields once were. His children grew up in Sherwood Forest, and the neighborhood remains family-friendly.

The Robin Hood Swim Club, the focal point of the community throughout the summer, sits on a portion of Curtis's original 10 acres. He leased the land to the neighborhood's community association years ago and guaranteed a loan that eventually enabled the membership to build the swimming pool and purchase the land and the surrounding grounds.

Curtis called it a "natural chain of events."

"I had four children," he said. "They had friends that needed a place to swim. [The association leaders] were looking for a spot to build a pool. I suggested this one and helped them with it. . . . I think the pool has been a nice feature in bringing the community together."

That pool has now served generations of Sherwood Forest families. Carolyn Bauer's parents helped get the swim club started, and she spent her childhood summers at poolside, competing with her friends on the Robin Hood swim team. Now Bauer, 46, has moved back to Sherwood Forest, and her three children, ages 16, 13 and 9, are enjoying summers at Robin Hood. "It's a huge deal in the neighborhood," said Bauer, who is on the pool's board of directors. The swim club has a picnic area; features volleyball, tennis and basketball; and sponsors a Fourth of July parade.

Bauer's community connections helped find her family's current home, which was purchased from a woman whose son she knew from the swim team. "She said, 'I can only sell my house to someone I know,' " Bauer recalled.

Bauer has lived in her Sherwood Forest split-level for 11 years and says the neighborhood is perfect for families. "You have [Westover] elementary school you can walk to, a pool you can walk to. . . . That's what makes this neighborhood different from another one." Bauer's parents still live nearby, and three of her neighbors are original homeowners.

Dave Michaels, 59, moved to Sherwood Forest with his parents in his early teens. I thought I died and went to heaven," he said. "Anything any teenager could want was here." Michaels soon met a group of friends in the neighborhood who attended local schools together. He remembers the arrival of the McDonald's at New Hampshire Avenue and Randolph Road as a big event for young people in the late 1960s.

The neighborhood has transitioned from those original families, and a new generation is beginning to move in. "I welcome the changes," Michaels said. "It's a natural thing, keeps things dynamic," noting that the county's work to upgrade Westover Elementary School has added to the neighborhood's value.

Long & Foster agent Dave Savercool and his wife, Susan, moved to the area about 15 years ago from another Silver Spring neighborhood, seeking a bigger house for their three children. Many families come to Sherwood Forest seeking more space, Dave Savercool said. "There's a fair share of government workers, university types," he said, and in the past five or six years, workers from the nearby Food and Drug Administration have discovered the neighborhood.

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Details on the Potomac Crest neighborhood

BOUNDARIES: Cedar Ridge Drive to the north, Foxcrest Court and Potomac Crest Drive to the east, Turncrest Drive and Potomac Crest Drive to the south, and Cobble Creek Circle to the west.

SCHOOLS: Beverly Farms Elementary School, Herbert Hoover Middle School, Winston Churchill High School.

HOME SALES: In the past 12 months, four homes have sold, for prices ranging from $825,000 to $1.1 million, according to Debbie Cohen, an agent with Long & Foster. Recently, there were three homes listed for sale at prices ranging from $847,000 to $1.278 million.

WITHIN WALKING DISTANCE: Cabin John Mall, Montgomery County Ride On bus stop on Tuckerman Lane.

WITHIN 10 TO 15 MINUTES BY CAR: Cabin John Regional Park, National Institutes of Health, Suburban Hospital.

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Do-it-yourself: How to remove soap scum

Q. I have a fiberglass shower wall and tub that have accumulated a lot of hard-water stains, soap scum and dirt. I have tried all kinds of products, and they just don't clean it. Can you help? ¿ C. Davis

A. Fiberglass surfaces are rather easy to keep clean once you get them that way, but removing existing crud could take a lot of scrubbing.

Don't use abrasive cleaners; they can dull or scratch the surface. One product worth trying is Mr. Clean Magic Eraser Bath Cleaner. This is an oversize version of the regular Mr. Clean Eraser. You will probably need several to remove a lot of accumulated grime.

Another product sometimes recommended is ordinary baking soda. Put a generous amount of baking soda on a soft, white cloth, moisten it and scrub.

Some hard-water stains can be removed by scrubbing with full-strength white vinegar. For tough stains, make a paste of vinegar and baking soda and scrub with that.

Once you get the fiberglass clean, here is how to keep it that way: After every shower or use of the tub, use a squeegee to wipe water from the flat surfaces. Then use your towel to wipe down the walls and tub, leaving them as dry as possible. The wipe-down takes only a minute or so, and it pays off by not giving the hard and soapy water a chance to form stains.

Q. I just moved into a building where the previous occupants must have played indoor baseball. There are several holes in the drywall about the size of a baseball. Is there a fast, easy way to patch these holes? ¿ G. Arnold

A. Holes in drywall aren't difficult to patch, but the job is seldom fast and easy. It is usually necessary to repaint the entire wall after patching.

As for the holes, which are often caused by the bumping of doorknobs or the corners of furniture, there are at least a dozen ways to patch them. Many do-it-yourselfers prefer to use a repair kit, sold at many home centers and on the Internet. Kits generally contain all or most of the materials needed to make the patch. Look for a kit that includes drywall joint compound, which is needed to smooth over the patch.

If you have several holes and don't want to use kits, you can buy the materials separately. Buy "setting type" joint compound, which comes in bags and lets you mix only as much as needed for the job at hand.

The following is my favorite method for patching drywall holes: Make a square pattern from cardboard that covers just the hole and draw an outline of the pattern around the hole. Neatly cut the edges of the drywall around the hole to match the pattern lines, using a sharp utility knife or a fine-toothed keyhole saw. Next, cut a piece of drywall that is about one inch larger on all sides than the pattern; this will be the patch.

Place the cardboard pattern on the back of the patch and draw its outline so that there is a margin on all sides. Cut out only the back of the patch, along the pattern lines, so that the front paper covering is left in place to form four thin flanges.

Test-fit the patch in the hole, then butter the back of the flanges and the edges of the patch with joint compound and press it in place with a six-inch-wide drywall joint knife. The paper flanges should hold the patch in place.

When the compound dries, smooth over the flanges of the patch with more joint compound; three coats are usually needed. Let each coat set up for several minutes, then carefully smooth it with a damp sponge and let it dry. This will reduce the need for sanding. When the patch is smooth and all the compound is dry, prime the patch and repaint the wall.

QUICK TIP: Reader Les Hamilton suggests trying an oscillating multi-tool for power removal of old tile grout. These small, hand-held power tools, sold under a variety of brand names that often include the word "multi," have a very rapid reciprocating action. They can be fitted with a variety of small blades that perform tasks such as sanding, sawing and scraping. Hamilton says his MultiMax tool kit, made by Dremel, includes a blade for grout removal. Dremel MultiMax kits sell for about $100.

If grout removal is one of the main reasons for buying a multi-tool, I recommend checking first to make sure a grout-removal blade is included or is available as an extra accessory. Multi-tools are excellent for working in tight places and are available in corded and battery-powered versions.

¿McClatchy-Tribune

Questions and comments should be e-mailed to Gene Austin at gaus17@aol.com. Send regular mail for Gene Austin to 1730 Blue Bell Pike, Blue Bell, Pa. 19422.

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