April Fools' Day has passed, so there's no reason to get pranked by faulty reports and myths about real estate.
Q. Is it true that Bank of America, which has our loan, will now let us give our house back to the bank but then lease it to us for below-market rent until prices go up again?
A. It depends mostly on where you live, plus some other factors.
Bank of America is the nation's largest mortgage lender. News of its novel "Mortgage to Lease" program was quickly picked up by broadcasters and shot around the Internet when it was announced in late March, but many of those reports were a bit misleading.
BofA's limited plan is real, but some other recent real estate stories are not.
Truth is, Bank of America's new plan is merely an experimental program that affects only about 1,000 financially distressed homeowners in New York, Arizona and Nevada. Owners who get a letter from BofA stating that they are eligible for the pilot plan can deed their property over to the bank and then lease it back for a below-market rental rate.
The bank is essentially "preselecting" homeowners who are at risk of foreclosure: Its millions of customers can't just call up and request to be included in the program.
Borrowers who qualify will be able to slash their monthly housing costs, stay in their homes and avoid the stain that a foreclosure would put on their credit record. Bank of America, meantime, will avert the cost of lengthy foreclosure proceedings and also collect a modest amount of monthly rental income instead of getting nothing from a vacant property that was financed by a loan that turned sour.
Although the new plan is currently being offered to relatively few borrowers, a BofA representative said it could be expanded to other parts of the nation if it proves successful.
Q. Do bottled drain cleaners like Drano or Liquid-Plumr really damage pipes, like my brother-in-law says, or are they OK to use?
A. They are usually safe on both cast-iron and plastic pipes, as long as you carefully follow all of the instructions on the bottle's label.
Though commercial drain cleaners probably won't hurt your home's plumbing system, there's often a cheaper and more "eco-friendly" way to go. Just put about half of a small box of dry baking soda down the clogged drain, follow it with a half-cup of vinegar, and quickly cover the drain's opening tightly with a face towel or rag.
Interaction between the baking soda and vinegar will create a mini-volcano -- sort of like the ones that millions of kids have used for their grade-school science fairs -- but the rag that's stuffed in the hole should force the explosion downward and blow out all but the nastiest of clogs. Pour a gallon or two of boiling water down the drain 30 minutes later to clear out any residue.
Q. Is it true that the term "mortgage" originated because a borrower will likely be in a mortuary before the loan can be paid off?
A. No, but it's a question I get asked a few times a year.
Mortgage is a combination of two Middle Age French words -- "mort" (death) and "gage" (pledge).
If you bought a home today, you would obviously need to pledge the property as collateral for the loan. When it's finally paid off, the contractual pledge would be "dead," and the lender would no longer be able to take the house away from you.
Q. I have heard a lot of crazy stories about renters suing their landlords over minor issues, but did a college kid really collect $1 million from his university because he fell out of his dormitory window while "mooning" other students? If so, it's one more reason why we have to reform the legal system!
A. There are ample reasons why our legal system needs to be overhauled. The lawsuit you're asking about was indeed filed several years ago, but I'm pleased to report that the student received nothing but hefty bills from his attorneys and doctors.
The young man sued the University of Idaho after tumbling out of his third-floor dorm room's window, which shattered after he climbed up a 3-foot-tall heater to display his naked buttocks to students down below. He deserved $940,000, he claimed, because the school had failed to provide a safe environment for its students or to properly warn them about the dangers of upper-story windows.
Fortunately, the judge turned his own backside to the case and kicked the lawsuit out because it "had no merit," in part because the teenager was apparently bright enough to be accepted to the university and therefore should know the hazards of sticking his butt out of a window.
I don't know whether the disappointed plaintiff left the courthouse through its front door or the rear.
• For the booklet "Straight Talk About Living Trusts," send $4 and a self-addressed, stamped envelope to David Myers, P.O. Box 4405, Culver City, CA 90231-4405.
© 2012, Cowles Syndicate Inc.