Help For Homeowners – Page 2 – Miami Real Estate Attorney Blog

Top 3 Reasons You Need A Real Estate Lawyer For Your Real Estate Transaction

Our firm handles real estate closings. We’ve been doing them now for over ten years. A real estate closing is the final step of a negotiated contract to transfer real property from the seller to the buyer. With that in mind, we are frequently asked, “do I need a lawyer for my real estate transaction?” The answer to that question is no, you don’t need a lawyer. But you should have a lawyer, on your side, representing you, and looking out for your best interests. Having a lawyer is important because the lawyer will typically have the experience and the knowledge necessary to properly navigate your real estate transaction. With that said, here are the top 3 reasons you need a real estate lawyer for your real estate transaction.

1) OBSTACLES

You may run into obstacles that could bring your real estate transaction to a halt. Having the right professional will help to ease those tense situations, and work through those obstacles. On the other hand, you can certainly try and do it all yourself. But in this world, we should probably stick to what we know and do best. Still, if you are set on performing a transaction without a lawyer, we would suggest at least talking to some real estate lawyers and getting their opinion on your real estate transaction. Even if it is for a quick five-minute meeting.

2) COSTS

You may think the cost involved in hiring a professional is too high. You may also think that by hiring an expert that there is an extra layer of hassle on top of the added costs. And all of that may be true. But making decisions by trying to save some money in the short run may end up costing you a lot of money in the long run. Plus, the hassle and aggravation will grow too. You are better off hiring a real estate professional early to deal with all the issues in advance before the they grow into larger and more expenses problems for you. Here are some additional tips to save money on closing costs.

3) PEACE OF MIND

By hiring a real estate attorney you are buying peace of mind. You’re buying a solution. You’re buying yourself the safest and smoothest possible transaction and solutions to problems that arise.

The importance of hiring the right professional cannot be overstated.

In a real estate transaction, you should have a lawyer to represent your interests.

If you have any questions about your transaction, then please feel free to contact us.

We’re here to help.

Buyer Beware: How Home Buyers Can Avoid Buying a Liability

Home hunting is often very frustrating. This true horror story of home buyers suing their real estate agent for $2 million after discovering that their home was infested with snakes is a cautionary reminder that all home buyers should take the necessary precautions to ensure that they too are not buying a home infested with snakes, or worse. So buyer beware. This blog post is intended to educate home buyers and help home buyers avoid buying a liability.

Know Your Contract. Too often a property is listed for sale “as is.” You should understand exactly what is meant by the “as is” nature of the transaction. As will be discussed below, if you are buying an “as is” property, then it is important to conduct the necessary due diligence at the property to ensure that it is structurally sound and safe before you actually buy it.

Know Your Lender’s Requirements. Some lenders are very strict. They won’t lend you money to buy the property if the property has problems. For instance, if the property has a leaky roof, or radon gas, then your lender may require you to correct those issues before you can buy the property.

Know Your Property and Seller. In this day and age just about everything is on line. So use the internet to find out as much information about both your seller and the property itself. For instance, if the property recently had an 800-foot addition added, then check the county records on line to confirm that the addition was built with the appropriate permits.

Know the Seller’s Disclosures. The seller’s disclosures are intended to inform the buyers of known defects with the property. This is often known as a “latent defect.” But what happens if a defect was either not known to the seller or the seller failed to disclose a known defect to the buyer? The answer to this question is often buried in the fine print of your real estate sales contract. And the answer to this important question is something the buyer should find out prior to completing the real estate purchase.

Get a Home Inspection. A home inspection is a lot like driving a car, only better. A home inspection should reveal every issue/problem that may exist with the property, if any. Home inspections can cost several hundreds of dollars. But that is money well spent as the home inspection may reveal a serious issue that will need to be addressed at a later date. Issues revealed during a home inspection may also be serious enough that a home buyer may actually need to walk away from the transaction.

Rare Display of Congressional Bipartisanship Results in the Unanimous Passing of the Housing Opportunity Through Modernization Act Making it Easier to Buy and Sell Condominiums in South Florida

Congress’s approval ratings are currently at all-time lows. The bickering between the political parties on Capital Hill is at an all-time high. A majority of Americans are greatly unsatisfied with the choices their respective political parties have given them for President.

Yet in this toxic political climate it gives us all hope to see our elected officials work together to bring about some much needed help in our real estate market. Indeed, the rare display of congressional bipartisanship resulted in the Unanimous Passage of the Housing Opportunity Through Modernization Act making it easier to buy and sell condominiums in South Florida.

The legislation was backed by several realtor groups. They supported the legislation because the Housing Opportunity Through Modernization Act seeks to streamline and improve three specific areas of federal housing policy.

Those three areas include the following:

First, the U.S. Department of Housing & Urban Development’s (HUD) rental assistance and public housing programs.

Second, the Federal Housing Administration’s (FHA) requirements for condominium mortgage insurance.

Third, the Department of Agriculture’s single-family housing guaranteed loan program.

The Obama Administration has not publicly commented on whether the President would sign or veto the legislation. But given the overwhelming bipartisan support in unanimously passing this legislation it would be surprising if President Obama vetoed this act.

Of significance to the local South Florida real estate market are changes in the act that will help with the sale of condominiums. South Florida has a high inventory of condominiums. Condominiums often represent an affordable housing option that makes sense for many first-time and low-to-moderate income homebuyers in South Florida.

But the sale of those condominiums are often bogged down due to some unnecessary and burdensome rules and regulations imposed on condominiums. This legislation addresses those restrictions head on, putting the dream of homeownership back in reach for more first time home buyers and low to moderate income homebuyers in South Florida.

Among other things, the Housing Opportunity Through Modernization Act seeks to make the sale of condominiums less burdensome.

For instance, the legislation includes revisions to make FHA’s recertification process substantially less burdensome. It does so by lowering FHA’s current owner-occupancy requirement from 50% to 35%. The legislation also mandates that the FHA replace existing policy on transfer fees with the less-restrictive model already in place at the Federal Housing Finance Agency.

How to Calculate the Statute of Limitations in a Mortgage Foreclosure

Lawyers are often accused of complicating simple topics. One such question that we get asked about often by both lenders and debtors is when does the statute of limitations run on a mortgage foreclosure in Florida. This simple question has actually generated national headlines. So we will devote this post on how to calculate the statute of limitations in a mortgage foreclosure.

A statute of limitations is best described as a statute prescribing a period of limitation for the bringing of certain kinds of legal action. For example, in Florida, if you were involved in a car accident, you have four years from the date of that accident to file a lawsuit. If you wait four years and a day, then your claim is barred.

In Florida, actions based on a contract have a five year statute of limitations. So presumably, if one fails to pay their mortgage and the lender waits five years and a day, then the lender’s claim is barred by Florida’s five year statute of limitations.

But what happens when a lender, or the court, dismisses an otherwise timely lawsuit for mortgage foreclosure, and the lender then re-files that lawsuit five years and a day after the initial default?

To answer that simple question turns on many different factors. This issue, however, is actually going to be decided, and resolved, by the Florida Supreme Court.

But today there exists a conflict in the different courts of appeal, in Florida, and that existing conflict is what the Florida Supreme Court is going to resolve.

For instance, some appellate courts in Florida adhere to the “continuing default” theory. The Fourth and Fifth District Court of Appeal have each concluded that after a foreclosure was dismissed that the lender could re-file based on the new default that occurred after the dismissal of the suit. That was the case even if the original default, the one that served as the basis for the original suit, had occurred more than five years go.

Under that “continuing default” theory, the dismissal negates the acceleration of the loan such that mortgage payments would continue to be due and owing each month after the lawsuit’s dismissal. Therefore, this permits the lender to reaccelerate the loan following a new default.

As the Fourth DCA noted in Evergrene Partners v. Citibank, when “the claims of acceleration and subsequent acts of default have never been adjudicated on their merits in this case, … any acts of default still within the statute of limitations may be raised in a subsequent suit.”

However, the Third District Court of Appeal, the appellate court governing Miami, in Deutsche Bank v. Beauvais, has expressly disagreed with the Fourth and Fifth District Court of Appeal and has rejected the “continuing default” theory.

In Beauvais, the Third DCA noted that the dismissal “did not by itself negate, invalidate or otherwise decelerate the lender’s acceleration of the debt in the initial action.” Since the lender took no affirmative action to reinstate the loan following the dismissal, the second foreclosure action filed more than five years after the original default was deemed untimely and barred by the statute of limitations.

But as it stands today, the best course of action for lenders is to ensure that their actions are filed within five years of the original default even if the case has already been dismissed one time. For debtors, if more than five years have passed, you will need to check to see if the lender ever attempted to “deaccelerate” and then “reaccelerate” the loan after the dismissal. If they did, then the five year statute of limitations may have been extended. With that said, do not hesitate to contact us should you wish to discuss your legal rights as they relate to the calculation of the statute of limitations for a mortgage foreclosure.

New Rules for Closing Residential Transactions

New Rules for Closing Residential Transactions

If a buyer of a residential listing applies for a mortgage loan on or after August 1, 2015, new federal regulations will apply to the loan transaction. Generally, these new regulations will apply to all transactions involving a new residential mortgage loan. Cash and commercial transactions, even if a residence is involved, are not affected.

New Forms Replace GFE and HUD-1 Settlement Statement

After August 1, 2015 buyers applying for a mortgage loan will receive a Loan Estimate from the lender instead of the current Good Faith Estimate (GFE). Buyers will generally receive the Loan Estimate three days after applying for their loan.

The other new form, the Closing Disclosure, will include all of the information currently found on the HUD-1 settlement statement (HUD-1); it will also include an additional three pages of financial disclosures currently found on other forms. The traditional HUD-1 information will be found on pages two and three of the new five-page Closing Disclosure. However, the Closing Disclosure does not use the same familiar categories found on the HUD-1 and some costs are in a different area. For example, your real estate commission and any related charges for your services will be located in Section H labeled “Other” at the bottom of page two of the new form.

Lender Will Prepare Closing Disclosure

While the new rule allows a lender to authorize a settlement agent to prepare the new form, for a variety of reasons you should expect that the lender will prepare this new five-page form. This is a brand new challenge for lenders because most of the information currently found on the HUD-1 is gathered by the settlement agent. For example, your commission, association assessments, home warranties, inspection fees, etc.

Settlement agents will continue to be responsible for gathering this information and providing it to the lender. They will need to provide exact information about services and charges to the lender in a timely fashion. Therefore, you will need to communicate your information to the settlement agent much, much earlier than day of closing, perhaps two weeks before the scheduled closing date! Why? Read on. Continue reading “New Rules for Closing Residential Transactions”

Accidental Landlords Take Advantage of HARP 2.0 to Re-Finance Their Investment Properties and Save Thousands of Dollars

As we previously discussed, the Harp 2.0 program is a government sponsored program intended to help many struggling homeowners re-finance their homes. An often overlooked aspect of Harp 2.0 is that it is also intended to help accidental landlords re-finance their investment properties and help them save thousands of dollars.

An “accidental landlord” is someone who purchased a new primary residence, but was unable to sell their prior primary residence.

Under this scenario, the initial primary residence is converted into an investment property. In other words, after you purchased your new home you could not sell your old home. As a result, you started renting the old home and became an “accidental landlord.”

The question that is often asked is under this scenario would the “investment” home/property be eligible to re-finance under Harp 2.0?

If the homeowner can qualify to re-finance under Harp 2.0, then there is a good chance that the converted investment property may also qualify. And if it qualifies, then that could potentially save the accidental landlord thousands of dollars over the life of the loan.

There are no doubt obstacles that need to be overcome in order for an accidental landlord to qualify to re-finance under Harp 2.0. But generally speaking, in order to qualify the homeowner must be current on their mortgage, with no late payments exceeding 30 days in the last six months and no more than one late payment in the last year. Under the initial Harp guidelines, loan to value limits were capped at 125%, but Harp was modified (Harp 2.0) to remove those caps and now there are no “underwater” limits. On the other hand, however, the current loan to value ratio must be greater than 80%.

But if you want to take advantage of this program you better hurry. The program is currently set to expire on December 31, 2015.

If you do qualify, the potential savings could be significant. Of course, if you do qualify, and decide that re-financing under Harp 2.0 will save you thousands of dollars, then make sure you follow these seven tips to save money on closing costs. And, of course, don’t hesitate to contact our office to discuss your options further.

Four Tips to Intelligently Make an Offer on a Home

Deciding to purchase a home is one of the biggest financial decisions we will make in our lifetime. We recently discussed five mistakes that all first time home time home buyers should avoid making. But in this post, we will provide four tips to intelligently make an offer on a home.

So when you find a home that you love, and that is within your budget, you want to make sure that your offer is both realistic and good enough to beat other potential buyers trying to buy the same property while also ensuring that you don’t over pay for the property.

Here are five tips that could help you accomplish that objective:

Research. Before you submit an offer on that property you should conduct as much research as possible about the subject property. You should try and find out how long the property has been on the market. Learn about the current market dynamics in that neighborhood in terms of supply and demand for other properties. You should also check the physical condition of the property. In sum, the more information you can obtain about the property and area the better position you will be in to negotiate the sales contract.
Initial Offer. Once you are ready to submit an offer, you should quickly and thoroughly prepare a proposed contract with all of your proposed terms and conditions. It is not enough to simply agree on a sales price, but you should also consider when you want to close as well as ensuring that you will be receiving clear title at the time the transaction is complete.
Negotiate. Remember, your initial offer is just that – a starting point. Therefore, be prepared to receive a counter-offer from the seller. The counter-offer may include many non-financial terms as well as a new proposed sales price. Be prepared to go over both the proposed sales price, and other proposed terms. Also be prepared for these negotiations to go several rounds with the seller.
Home Inspection. It is imperative that before you purchase the home that you schedule a thorough home inspection. An inspection should focus on unsafe conditions or expensive repairs like structural integrity, plumbing, roof condition, electrical maintenance, termites, pests, and more. Moreover, if you have any additional concerns, be sure to discuss them with your inspector so your inspector can inspect same. Once the inspection is complete, your inspector will prepare a report and that report may serve as the basis to re-open negotiations with the seller.

Once you have completed this process, it will be time to complete your transaction and become a home owner. Here are seven tips to save you money on closing costs.

Nonetheless, if you follow the above process you will no doubt help yourself get the best possible deal on your home purchase.

Help for Struggling Homeowners Facing Foreclosure as JP Morgan Agrees to pay $13 Billion

J.P. Morgan Chase & Co. agreed to a $13 billion settlement with the Justice Department for their role in the financial crisis. J.P. Morgan Chase & Co. was under the microscope as they had several investigations and lawsuits currently against them for soured mortgage bonds, which were issued before the financial crisis. This settlement is the biggest in U.S. history, which is good news for distressed homeowners as a significant portion of the settlement funds will be given to aid them.

J.P. Morgan Chase & Co. will be giving $4 billion of the $13 billion to aid homeowners in need of some support. If you are a distressed home owner with an upside home, or facing foreclosure, you should contact our office today to discuss your options. Indeed, this settlement may help many struggling homeowners with homes that are underwater as this settlement may pave the way to save your home.

J.P. Morgan Chase & Co. agreed to pay as much as $1.7 billion and as little as $1.5 billion to bring down the principal amounts on loans that J.P. Morgan has held and where borrowers owe more than the property is actually worth. This could be a big relief to homeowners, because this is often times a big reason for foreclosures throughout the United States.

Additionally, J.P. Morgan will be giving at least $300 million and as much as $500 million to restructure mortgages in an attempt to lower monthly payments, which is known as forbearance. The remaining $2 billion aimed at helping homeowners will be used in multiple ways, including absorbing the remaining principal owed on properties that have not yet been foreclosed but are currently vacated, and/or new mortgage origination for borrowers with low and moderate income.

J.P. Morgan is attempting to fix the damage caused by bond offerings that were much weaker then advertised. Although this is not the only claim against J.P. Morgan as they are in a wide array of investigations and lawsuits, this is a significant step in righting their wrongs and doing their part in helping struggling homeowners.

Foreclosure Judgment Vacated Because of Bank Irregularities and Technicalities

Florida’s Third District Court of Appeal recently vacated a foreclosure foreclosure judgment because of bank irregularities and technicalities. Specifically, the Third District Court of Appeal vacated a final judgment because the financial institution relied on inadmissible hearsay testimony to prove their case. Hearsay is a legal term for testimony in a court proceeding where the witness does not have direct knowledge of the fact attested to while testifying. In short, secondhand testimony is barred by the hearsay rule.

Kelsey v. Suntrust Mortgage, Inc. involved a mortgage foreclosure dispute. Suntrust Mortgage Inc. prevailed at trial despite the fact that Suntrust’s only witness testified that she had no first hand knowledge of the loan or note. That witness further testified that she had only seen the subject note once during the trial. The mortgage file was first brought to the witness’s attention once litigation had already been filed. SunTrust used the witness’s testimony to try and authenticate the note relating to the mortgage, even though her knowledge had come from out-of-court documents that had not been made available for inspection prior to trial.

On appeal, the Third District Court concluded that such impermissible hearsay testimony could not serve as the basis for the entry of a judgment against the Plaintiff. This appears to be the first result regarding robo-witnesses after the recent fall out from robo signors.

Moreover, the Third District Court of Appeal further determined that the foreclosure plaintiff must show an agreement, a default, an acceleration of debt to maturity, and the amount due. The Plaintiff, in Kelsey, failed to show these documents. Whatever documents were presented at the time of trial were not properly authenticated. Additionally, Suntrust failed to have a witness testify whose testimony was not barred by Florida’s hearsay rules.

For the reasons mentioned above regarding the documents, the only testimony presented at trial was considered to be hearsay and an error in the eyes of the Court. In order for the bank to have properly authenticated the documents it must have been shown that the witness that did testify was a records custodian or had some personal knowledge on the documents. Since she did not, her testimony was impermissible and the judgment was vacated since it was predicated on impermissible hearsay testimony.

If you are facing foreclosure or wish to assess your real estate related options, then please do not hesitate to contact us today.

Florida’s Homestead Protections Extended to Non-U.S. Citizens

Florida’s Homestead protections have been extended to non-U.S. citizens. Indeed, the Florida Supreme Court has extended the benefits of Florida’s homestead provisions to people who are not United States citizens or permanent residents. Florida’s homestead provisions give homeowners in Florida crucial benefits such as a reduction in the value of homestead real property for the purposes of property tax. These provisions also allow homeowners some protection against creditors. Specifically, creditors cannot force sale or acquire the homeowner’s property as part of the debt collection process. Tax debts are still exempt from the benefits of the homestead provisions.

In the past the benefits stemming from Florida’s homestead provisions were solely for permanent residents and United States Citizens who own their principal residence in Florida.

However, non U.S. citizens and non permanent residents who own real estate in Florida that serves as the principal residence of their dependents who are United States citizens or permanent residents may secure the benefits of Florida’s homestead provisions.

For instance, Florida’s Supreme Court in Garcia v. Andonie, 101 So. 2d 339 (Fla. 2012), ruled in favor of a Honduran couple attempting to claim a homestead exemption despite the fact that they were not lawful residents of the U.S. Florida’s high court concluded that the couple could take advantage of Florida’s homestead exemptions because the couple resided in the home with their three minor children. Since the three minor children were U.S. citizens, as well as the legal dependents of the property owners, i.e. the non-resident Honduran couple, and the home was being used as a principal residence since the Honduran couple could lawfully reside in the U.S., the court concluded that they could receive the benefits of qualifying for the homestead exemption.

In essence this means that people who are not U.S. citizens or permanent residents, but who have dependents such as young children that are U.S. citizens, or permanent residents, and that live in that residence as a primary residence, can take full advantage of Florida’s homestead provisions. Ways in which they can prove that this is a primary residence is where the children are registered for school, bank statements, and even utility bills.