DEAR BOB: My son found a house he would like to buy. The listing agent showed him the comparative market analysis that was given to the seller when the house was listed for sale. Should my son rely on this information to make his purchase offer? Also, should the seller pay for a professional inspection of the house? Should my son have his own agent or should he rely on the listing agent?--Harold S.

DEAR HAROLD: Your son needs to clarify whether the listing agent is representing the seller only or if the agent is acting as a "dual agent," representing both the seller and the buyer. Agency disclosure is extremely important and should be put in writing by the agent.

While it was nice of the listing agent to give your son a copy of the comparative market analysis (CMA), which shows recent sales prices of comparable nearby houses, this information may be out of date or inaccurate. Your son needs a current CMA that shows the most recent home-sales prices.

Since the listing agent has an inherent conflict by representing both the seller and the buyer in the same sale, although it's perfectly legal, I recommend your son get his own buyer's agent.

Your son's agent can negotiate on his behalf and present your son's purchase offer. Also, the buyer's agent can show your son other listed homes for sale, as well as "for sale by owner" homes. Hiring a buyer's agent won't cost your son anything more because the two agents will split the sales commission that the seller pays. The listing agent won't be thrilled when your son gets a buyer's agent, but it is in your son's best interest to do so.

As for a professional inspection, your son's purchase offer should contain a professional inspection contingency clause. After the seller accepts the offer, your son can then hire an inspector. He should accompany the inspector to discuss any discovered defects. Your son should pay the inspection fee, typically about $300.

In my opinion, the best inspectors are members of the American Society of Home Inspectors, listed in the phone book's yellow pages.

DEAR BOB: I am an apartment landlord whose units have about a 10 percent vacancy rate. My rents are at market rates, but my apartments are on busy streets so tenants don't stay more than a year. A friend suggests that I start accepting pets. I'm reluctant to do so, but my friend says I can get higher rents and my tenants will stay longer. Your advice, please.--Kathryn W.

DEAR KATHRYN: You have a wise friend. Although I currently don't accept pets, when the rental market becomes soft from time to time, I have accepted tenants with pets at higher rents to compensate for pet damage.

Residents with pets usually make excellent long-term tenants because they often appreciate a landlord who allows pets. However, be aware that once you allow a tenant with a pet in an apartment building, then the other tenants will want to have pets, too.

DEAR BOB: Recently you wrote, "Fannie Mae even offers reverse mortgages for senior citizen home purchasers with no monthly payments." Was that a misprint?--Jean W.

DEAR JEAN: That statement is correct. For example, in 1997 Fred and Marion Vallier, ages 89 and 86, of Ames, Iowa, obtained the first Fannie Mae reverse mortgage for home purchase. They bought their new $154,000 house with the help of a $93,000 Fannie Mae Homekeeper reverse mortgage with no monthly payments. The balance of the purchase price came from the sale of their old house.

DEAR BOB: I must disagree with you about do-it-yourself home sales. In May we sold our house and only had to pay a 3 percent commission to the real estate agent who brought in the buyer. We had our house on the market just three weeks. The open houses and advertising were worth the commission savings.--Rita W.

DEAR RITA: The current market for home sales is strong in most cities, thus making it easier to sell a house without listing it with an agent. You were fortunate your buyer was represented by an agent who prepared the purchase offer and handled the 1,001 details of a successful closing.

Handling the entire sale without a professional agent could have been difficult. You paid half of a customary sales commission and "earned" the other half by using the service of the buyer's agent.

DEAR BOB: We recently bought a house with an obvious water-leak stain in a bedroom. The seller assured us that the leak happened only once during a heavy rain and that it had been repaired. Our professional inspector's report said, "It looks as if some sort of roof repairs have been done." But the first time it rained, we had a major leak at the exact same spot.

The leak was because of bad flashing and water was running down the chimney straight into the bedroom. The flashing repair cost us $500. Since the seller lied to us, are we entitled to reimbursement? We believe the seller intentionally misled us. She also lied on three other items, which were on the inspector's list, but were not noticeable on the final walk-through inspection.--Sandy A.

DEAR SANDY: It sounds as if the seller knew about the leaking roof and should be liable to you for breach of contract if she did not disclose it. Your first step is to make a written demand of the seller for reimbursement of repair costs within a reasonable time, such as 15 days.

If you don't receive prompt payment, go to small-claims court and let the judge decide if the seller should pay for the undisclosed defects. It sounds as if you won't have much difficulty proving the seller knew of the problems.

DEAR BOB: I own a nice town house condominium. The carpet is worn, and I'm considering replacing it with a hardwood floor. But I plan to stay only a few years. Is a wood floor a good idea?--Connie S.

DEAR CONNIE: First, check with the homeowner's association to be sure there are no restrictions against installing a hardwood floor in your condo. Many condos bar wood floors because of sound transmission between units, but that may not be a problem with your town house.

Second, consult real estate agents in your vicinity to learn if the extra cost of a hardwood floor will add more market value than it costs to install. In some areas, hardwood floors are desirable; in others, they aren't popular. If you're in doubt and plan to stay only two years, I vote for new carpet.

DEAR BOB: The selling price of our house is $218,500. Our buyer said she would be applying for an FHA mortgage. We are first-time sellers, so we don't know how FHA mortgages work. Our real estate agent said we are required by law to pay up to $1,500 of the buyer's closing costs. We agreed.

Now we are a month away from closing, and our buyer is probably not going with an FHA mortgage. Our real estate agent said we are still obligated to pay $1,500 of the buyer's closing costs. We feel we've been duped. Can this be? Are we obligated to pay the $1,500?--Iris W.

DEAR IRIS: There is no law requiring sellers to pay up to $1,500 of the buyer's FHA loan costs. However, that may be customary in your community if you are to be competitive with sellers of other houses, which are usually financed with FHA mortgages.

Now that your buyer is not obtaining an FHA mortgage, your obligation to pay $1,500 of the buyer's closing costs depends on the wording of the sales contract. If it says the seller will pay $1,500 of the buyer's closing costs, then you're obligated. However, if it says you agree to pay $1,500 of the buyer's FHA closing costs, then you aren't obligated if the buyer gets another type of mortgage.

But don't lose your sale over $1,500. Perhaps you were misled by the agent. Maybe you weren't. If paying $1,500 is what it takes to get your house sold, pay it. That is probably far cheaper than the potential cost of canceling the sale, putting the house back on the market and taking another month or longer to get it sold again.

DEAR BOB: My mortgage lender says that my house is in a flood zone and that I must purchase flood insurance. But my insurance agent says my house is not in a flood zone. This is the third time I have refinanced and every flood-zone check has been negative.

I faxed the mortgage company a copy of the "standard flood hazard determination" form from my insurance company, but they won't acknowledge it. Their toll-free phone number has hung up on me three times. Are all mortgage companies this difficult? What should I do?--Leslie G.

DEAR LESLIE: Be persistent. Don't give up. Write a short polite certified letter, return receipt requested, to your loan servicer's president. Ask for a reply within 15 business days. Also, ask for the name of the investor who now owns your mortgage.

It's probably Fannie Mae or Freddie Mac, the nation's largest mortgage lenders. If you don't get satisfaction from your mortgage servicer, contact the owner of your mortgage. Your effort will be profitable in the form of flood-insurance-premium savings.

DEAR BOB: We sold our triplex three years ago and carried back the mortgage for the buyer. She makes her payments on time but writes us nasty letters for allegedly selling her a bad place. It's 60 to 70 years old, but we kept it in good shape. We've received several offers to sell our $54,000 mortgage at a discount for $48,000. We sold the house in good faith without any hidden defects. Should we sell the mortgage?--Maria McL.

DEAR MARIA: That is an excellent offer you received for your mortgage. If I were in your situation, I would sell it to be rid of that complaining woman.

DEAR BOB: Two years ago, I gave a friend an $8,000 cash down payment and agreed to take over his $250 monthly payments for his property. He gave me a "security agreement" and included in the papers that I have his power of attorney to sign his name regarding the property. However, he kept the deed.

In February I told him that I had been paying for two years and that I needed his quit-claim deed. His daughter yelled to him: "Don't give her any papers, Dad. If she doesn't pay for it, it becomes yours again."

A lawyer wants $3,000 to take my case, but I have little money. The woman to whom I send the $250 monthly payments hasn't sent me a receipt for six months and the last balance seems as if I haven't paid anything at all. What should I do?--Joyce VonS.

DEAR JOYCE: It sounds as if you're buying that property under a land contract, also called a contract for deed, installment land sale contract or agreement for sale. Since your seller holds the legal title, you really hold nothing. A "security agreement" is for personal property, not real property.

Your situation occurs too frequently when buyers make all, or the agreed number, of monthly payments but are unable to obtain marketable title. I suggest you call the local bar association referral service for the names of several real estate attorneys.

Many lawyers charge a modest fee for the first half-hour interview. Hopefully, you will find an attorney who can straighten out the mess you and the seller created by not properly documenting the transaction. A quiet title lawsuit may be all that is required.

DEAR BOB: I am in the process of getting a divorce. I plan to keep the house for myself and three children. My ex-husband and I have about $42,000 equity. If we sell now, after real estate agent fees, we will each net about $13,500. I am reentering the work force and can't refinance. My dad has offered to lend me the money to buy out my ex-husband. Since home values continue to go up, what is my best course of action?--Karen S.

DEAR KAREN: If you sell the house, where will you and the children live? I suggest you keep the house if you can afford the payments. A good divorce lawyer can delay the home sale until the youngest child turns 18. Keeping the house in an appreciating market is an excellent idea.

DEAR BOB: The buyer of our house has notified us that he and his wife won't be able to get their mortgage funded on schedule. They have asked for an additional 21 days. Their deposit is about 10 percent of the sales price.

We said the delay is all right if they will give us the deposit money now, nonrefundable, with a written agreement to cancel the purchase contract if they don't close in 21 days. But they are hesitating to sign. Should we cancel the sale and start over?--Helene S.

DEAR HELENE: If your buyers are diligent in arranging a mortgage, most lenders can fund within 30 days. With the permission of the buyers, I suggest you talk with the lender to be sure the mortgage has actually been approved and will fund within 21 days.

If not, consult a lawyer about canceling the sale now rather than being strung along for another three weeks. Of course, you should be entitled to the forfeited deposit. I've seen mortgage-funding delays of a few days, but three weeks is a long time. There must be problems with that mortgage.

DEAR BOB: As executor of my aunt's will, I've tried to sell her two-bedroom house in a small Oklahoma town, population 3,500. There are only four real estate agents there. I listed it with one at $24,500 for six months. A buyer who offered $20,000 backed out because probate hadn't closed yet.

In March I listed it with another agent and told him to lower the price to $18,500. Should I list it with an agent in a larger city--Bartlesville, Okla., is 20 miles away--who might be more aggressive? Should I hire a property manager and rent the house? Should I auction it?--Earl A.

DEAR EARL: Until the current listing expires, you can't do anything but plan your next step. I'm surprised the house hasn't sold at that rock-bottom price, unless it's in a bad location or in horrible condition.

Do you know how much the house is really worth? Apparently it wasn't worth $24,500 if it didn't sell within six months except to that $20,000 buyer who backed out. Or perhaps the listing agent did a poor marketing job. Maybe you need a professional appraisal to determine the true market value.

Yes, interviewing agents from a nearby town is a good idea since the local agents haven't found a buyer. If your house is priced less than comparable ones in Bartlesville, many people will drive 20 miles to save money. Also, you would have the advantage of the multiple listing service there.

Since you live a long distance from the house, I do not recommend renting it. If you can't sell it by listing with a professional realty agent, auctions are popular in some rural areas if you can find a successful auctioneer who has sold similar houses.

Another alternative is to lease it with an option to buy. Give a generous rent credit to the tenant and be sure the lease option specifies that the tenant is to pay for the maintenance.

DEAR BOB: My wife and I owned our house from July 1987 to July 1997. We occupied it from July 1987 until October 1993. As a naval officer, I received orders to relocate. We rented the house from October 1993 until we sold it in July 1997.

Since we occupied the house for 15 of the 24 months before the sale, owned it for 10 years and moved as a condition of employment, can we qualify for a partial exemption under the 1997 Tax Act?

When we sold the house in 1997, we reported the sale under the old "rollover residence replacement rule." Recently, I was told any sale from May 5 to Aug. 5, 1997, could be reported under the old or new rule. Can I qualify for the reduced exclusion, and should I submit an amended tax return?--Mr. N.B.

DEAR MR. N.B.: It appears to me you did not qualify for the old Internal Revenue Code 1034 "rollover residence replacement rule" tax deferral. The reason is the home had not been your personal residence since October 1993, and it was sold 45 months later in July 1997.

You say you occupied the house for 15 of the 24 months before sale. But you didn't because you had not lived in the home since October 1993.

Consult a tax adviser, but it appears you don't qualify for either the old or new principal residence tax avoidance rules.

Readers with questions should write Robert J. Bruss at P.O. Box 280038, San Francisco, Calif. 94128.{copy} 1999, Tribune Media Services Inc.