While more people now have health insurance under the Affordable Care Act, many of their policies came with large deductibles. These deductibles are commonly between $2,500.00 and $6,000.00. Any deductible amount is due from the patient to the doctor or physician providing the healthcare services.
It is mandatory for the doctors to attempt to collect these fees, and necessary for them to so for the health of their business. For patient this creates financial strain beyond the monthly payments they are already making.
The Connecticut General Assembly is now considering a Bill which would greatly expand the range of materials and services for which a mechanic’s lien could be filed. Currently, the law allows a mechanic’s lien to be filed for materials and services in connection with site development of land or construction of a building.
The proposed law, SB887, would expand the services to include “any other service rendered to an owner of land.” Under this proposed law, a doctor rendering medical services to a person owning land could file a mechanic’s lien against the land if the doctor’s bill was not paid. The doctor would have 90 days after treating the patient to file the lien, and the lien would take priority over any mortgage or transfer which occurs within that 90-day period.
When buying a home or commercial property, it is common for the Seller to sign an “owners affidavit”, stating that no work had been performed on the property in the last 90 days that could lead to a claim against the property. This was done to provide the Buyer, and their Lender, with assurances that the no fresh liens would arise against their interest in the property once it was conveyed. Now, with doctors and other service providers being able to file mechanic’s liens, there would be no way to protect purchasers and mortgage lenders against claims by service providers for services that are not related to improvements on the property.
The Connecticut Department of Consumer Protection has finished revisions to the Residential Property Condition Disclosure Form as per Public Act 12-122 which was enacted in 2012.
The new disclosure form contains added provisions for the following:
- Community and association fees if applicable;
- The presence of or removal of underground storage tanks (namely oil);
- Suggestion that prospective buyer should seek building permit and certificate of occupancy information;
- Suggestion that property should be inspected;
- Information regarding prior or pending litigation, governmental or administrative actions, orders or liens relating to hazardous substances;
- Added information regarding smoke and carbon monoxide detectors;
- Increased credit to Buyer from Seller from $300 to $500 for failure to provide the form.
Prospective Sellers can download a copy of the form by following he link below:
Residential Property Condition Disclosure Form
Upcoming Changes in Real Estate Closing Procedures
Closing Disclosure Form & ALTA Best Practices
The real estate mortgage bubble has brought some changes to the real estate arena, but it seems the biggest changes are yet to come. The Consumer Financial Protection Bureau is replacing the long used HUD-1 Settlement Form with the Closing Disclosure form effective August 1, 2015.
The HUD-1 was a 3 page document that outline the closing transaction and was prepared by the Buyers attorney for closing, and was usually approved by the bank the day before or day of the closing. The Closing Disclosure form will be a reported 7 pages, will be prepared by the bank, and delivered to the closing attorney 3 business days before closing.
The result here is that lenders and attorneys need to become involved in the real estate transaction much earlier in the purchase process, and closing dates will be further out from the date of contract signing. Further, if any issues arise that require changes in the Closing Disclosure form, it will be at the lenders discretion whether changes are needed, and if they are, closing will need to be delayed by at least 3 days!
Further, since the new protections are creating more responsibility, and therefore liability, for the lenders, the lenders are requiring closing settlement attorneys to follow stricter guidelines. Many lender will be requiring that attorneys form and execute an ALTA (American Land Trust Association) Best Practices compliance guide, and if they fail to do so, they will not be able to close on loans from that lender.
Real Estate attorneys can no longer rely on “the way it has always been done”. The real estate closing procedures are changing, and attorneys need to adapt with them in order to properly represent their clients. Clients need to understand that the newer protections remove some of the control from the hands of the attorney, but that ultimately those requirements are there to protect the client.
Being foreclosed on? Consider short sale as an alternative.
Being foreclosed on can be scary. You are already in financial hardship and now you stand the chance of losing your home. If you do not qualify for refinance, another alternative to foreclosure is the short sale of your home.
In a short sale, you put your house on the market, and ask the bank to allow you to sell it for a lower, previously agreed upon price (such as the actual Fair Market Value). The bank then promises to accept that sales amount, minus any fees they approve, in FULL satisfaction of your outstanding debt. Once the short sale closes, the foreclosure action becomes moot and is withdrawn.While it still results in the loss of the home a short sale has many advantages to the home owner over the foreclosure process.
The benefit of a short sale is that because the bank is accepting the amount in full satisfaction, there is no deficiency. A deficiency is the difference between the amount owed, and the value or sales price of the house. In a foreclosure, lenders generally seek a judgment for the deficiency against the home owner. You can lose your home AND owe the bank money after. However, in a short sale, any deficiency is forgiven and the home owner is free and clear of the lender.
The second benefit is that the attorney fees associated with defending against foreclosure can quickly accumulate, especially if your goal is to buy more time in the home. Going through short sale, where you stand a good chance of the bank covering the closing attorneys fees, can save you on some of those fees for court appearances and document prep associated with foreclosure.
Getting a lender to accept a monetary loss is never easy. the short sale process takes a lot of time. They will require documentation regarding the income of the home owner as well as the value of the property. Approval is not guaranteed in any way, as short sale approval is in the hands of the bank. Further, there are tax consequences associated with being forgiven debt, so a CPA or tax attorney should be consulted.
If you need representation for a foreclosure or a short sale, contact our law office today for a free consultation.
Are you buying a condominium in Danbury or one of the surrounding towns such as Brookfield, Bethel, New Milford or New Fairfield?
I would like to point out two difference between buying a house and buying a condominium that some people do not consider.
The first difference is that condominiums have by laws. As opposed to a house, where you can pretty much do whatever you want (within reason), a condominium complex will have by laws, or rules, that every owner or tenant must follow. They can contain guidelines as to parking, noise, pets, and even where you can place a grill. Every condominium complex has it’s own by laws. Breaking by laws can result in fines. When you are buying your condominium, your real estate attorney will request these by laws and provide you with a copy.
The condominium complex will also have a master policy for hazard insurance and liability insurance on the property. This means that when you are buying your condominium, you will not need to buy additional insurance to satisfy your lender, as you would have to buy with a stand alone house. Also, you will be covered for any injuries suffered by guests that are visiting and hurt by defects in the property. When you are buying your condominium, your real estate attorney can request a declarations page and certificate of insurance contain the coverages of the master policy.
What is a Mortgage Contingency?
Mortgage Contingency in a Real Estate Contract
For the purchase and sale of a property, it is necessary to have a written contract. The contract will contain many terms, but the binding nature of the contract will be dependent on a range of “contingencies” that may or may not be necessary for a particular transaction. The most common contingency is a mortgage contingency. A party to a real estate closing may ask: “What is a Mortgage Contingency?”
Unless the Buyer is paying cash, they will need to get a mortgage to pay for the real estate property. Most parties want to have the contract signed as soon as possible, so the contract is usually signed before a mortgage is acquired. However, the Buyer will not want to be stuck with having to purchase the property if they cannot get a mortgage. Therefore, the contract would contain a mortgage contingency, stating that the Buyer will not be forced to follow through with the purchase if they cannot acquire a suitable mortgage, of a certain amount, by a certain date.
A mortgage contingency is satisfied when the Buyer receives a Mortgage Commitment Letter from their lender. The Mortgage Commitment Letter might contain it’s own contingencies, so it is important to have a real estate attorney review the Mortgage Commitment Letter to make sure it really is a commitment.
If a mortgage cannot be obtained by the specified date, a reasonable extension may be requested. If an acceptable mortgage cannot be attained at all, the contract can be cancelled, but the Buyer may be forced to pay a fee to the Seller or the Seller’s Attorney for the preparation of the contract. it is the responsibility of the Buyer’s attorney to inform the Seller’s attorney of the inability to acquire the financing, or the contract will become binding.
A Mortgage Contingency is a wonderful tool in the hands of a Buyer. It allows them to make sure a property is theirs to buy before they go through the hassle of lining up financing, and allows them to avoid the purchase if they cannot get a mortgage. There are consequences to failing to meet a mortgage contingency, so it is important to act reasonably.
Residential Property Condition Disclosure Report
In Connecticut, the seller of a residential property must provide the buyer or their agent a Property Condition Disclosure Report. This is pursuant to Connecticut General Statute § 20-327b, which applies to the sale of 1 to 4 family residential property, including sale of units in a condominium or common interest community. A copy of the Disclosure Report, signed by seller and buyer, must be attached to the purchase contract. A copy of the Property Condition Disclosure Report form can be found on the here:
Residential Property Condition Disclosure Report
Some transactions are exempt, and sellers do not have to provide a Property Condition Disclosure in the following situations (list not exhaustive):
- sale of newly constructed residential real property to which statutory warranties apply;
- sales by executors, administrators, trustees or conservators;
- sales by the state or Federal government or government agency; and
- sales of property acquired by deed in lieu of foreclosure or by a judgment of foreclosure.
Failure of the seller to provide a Property Condition Disclosure Report results in a $500 credit to the buyer as a matter of law.
Dual Agency Real Estate Transaction
Can One Real Estate Agent Represent the Buyer & Seller?
Recently, a potential client came into our office for representation in a commercial real estate transaction. He had contacted a real estate agent who told him the perfect property was already listed with his real estate agency, and negotiations on the real estate property had begun. That would make that real estate agent both the listing and selling agent on that transaction. The potential client had a question: Can one real estate agent represent the Buyer and the Seller on the same transaction?
Usually, the listing agent works for the seller and owes a duty of loyalty and confidentiality to the seller. Similarly, the selling agent works for the buyer and owes a duty of loyalty and confidentiality to that buyer. In a dual agency real estate transaction, the seller and buyer have the same agent, or both agents work for the same broker, creating a conflict of interest.
However, in Connecticut that conflict of interest is not a complete bar against dual agency. Dual agency is permitted in Connecticut, pursuant to C.G.S. § 2-325g. The statute says that Dual Agency is allowable as long as all parties are informed, and both the Buyer and the Seller waive the conflict of interest in a Dual Agency Consent Agreement. Yes, one real estate agent CAN represent both the seller and buyer in the same transaction.
In Dual Agency real estate transactions, it becomes even more important for clients to retain the assistance of a real estate attorney as soon as possible. First, the buyer or seller will want somebody to review the Consent Agreement. Secondly, they will need more protection since the agent is not solely looking out for their best interest.
If you are buying or selling a home, condo, apartment or place of business, contact The Law Office of Eugene Glouzgal. We charge very competitive flat fees on closings and our client oriented approach alleviates the stress involved in real estate transactions. Contact us today by phone at 203-794-6691 or by e-mail at Glouzgal@CTAttorney.us.
Role of the Seller’s Attorney in a Real Estate Closing
If you are looking to sell your home, you may or may not want to hire a real estate agent, but you will definitely want to hire a real estate attorney. While the marketing of your home to potential buyers is something you might be able to handle yourself, the services of a sellers closing attorney are essential to a legally compliant real estate sale. However, many sellers ask themselves: What does a sellers closing attorney do?
A sellers closing attorney offers an array of services to their clients that legally legitimize the sale and make it binding, while at the same time protecting the liability and financial interests of their client. A sellers closing attorney provides the following services:
- Reviews listing agreement with real estate agent/broker (if hired early enough);
- Drafts contract of sale;
- Negotiates contract terms with buyers closing attorney;
- Prepares closing documents such as disclosures and power of attorney;
- Obtains payoff statements from current mortgage companies;
- Attends the closing with, or on behalf of, the client;
- Handles cash flow in escrow, receiving purchase funds and paying off existing mortgages; and
- Secure and record releases for mortgages paid at closing.
A sellers closing attorney can save a seller of real estate property a lot of stress and worry. Selling a home or business location? Make sure you are legally compliant and your liabilities are limited by contact The Law Office of Eugene Glouzgall, LLC to handle your real estate closing matters. We charge flat rate fees on closings, and we offer FREE consultations, so you can make sure we are the right attorney for you.
Role of Buyers Attorney in Real Estate Closing
Whether you are looking to buy a home or a business location, you will need the services of a buyers closing attorney. A buyers closing attorney can make sure their client is protected legally and financially. What does a buyers closing attorney do?
A buyers closing attorney helps coordinate the purchase of the property by making sure all laws are followed, his client is getting the property as promised, and by managing the finances. A buyers closing attorney performs the following functions:
- Review the agreement between the buyer and their real estate agent (if hired soon enough);
- Reviews preliminary title report for mortgages, liens, restriction, taxes and ownership;
- Review and negotiate contract of sale with sellers closing attorney;
- Review mortgage commitment issued by the mortgage company;
- Prepare or review the title search;
- Prepare buyers closing documents such as power of attorney;
- Review sellers closing documents;
- Review loan documents;
- Attend closing with, or on behalf of, the client;
- Handle all funds through escrow;
- Provide an accounting of funds to the client; and
- Record all documents at Town Hall.
A sellers closing attorney can relieve the stress of buying a house or business property by making sure the client is protected. Buying a home or business location? Make sure the seller is legally compliant and your liabilities are limited by contact The Law Office of Eugene Glouzgall, LLC to handle your real estate closing matters. We charge flat rate fees on closings, and we offer FREE consultations, so you can make sure we are the right attorney for you.