You Need an Attorney(Revisted)

Thursday, August 26th, 2010

I am consistently asked by Buyers and Sellers either about to enter a residential transaction or already in a residential transaction, ” Do I need a Lawyer”? I will keep my answer simple. Yes!

You are embarking on what is likely the largest financial decision of your life. This is not be the time to decide to not have a set of trained legal eyes review and guide your deal.

I have mentioned the need for an attorney before but the reality hit home as yesterday as I attended a continuing legal education course for Pennsylvania attorneys. We are required to take 12 hours of class lecture each year to maintain our license and yesterday’s all day six hour course was specifically targeted on residential real estate transactions. The coursebook was over 400 pages and the six hours was not nearly enough time to cover everything. I point this out because when I first started taking this type of course 10 years ago, it was a 3 hour course with materials under 100 pages.

The residential real estate landscape has changed and become more complex. One thing that was mentioned time and time again in yesterday’s class was that residential transactions have more and more significant pitfalls and issues and there is no way a consumer could possibly understand everything that they are about to sign which will bind them to specific legal obligations. In addition, real estate sales people are not legally trained and are not allowed to guide the consumer with legal advice.

The residential deal is complex, hire an attorney who can explain the complexities!

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Still Problems in Housing Market

Wednesday, July 7th, 2010

It doesn’t matter if you are a Republican, Democrat or Independent, this is for everyone…..
(AP) — President Barack Obama says that no matter how much the government spends, some people still won’t be able to afford their mortgages and will lose their homes.
There are still underlying problems in the housing market, the President said, in part because “some people just got too much house for their salary.”
Obama made his comments in response to a question at a recent town hall event.
He said that Wall Street overhaul legislation pending in Congress would help with regulations to ensure that people don’t get “tricked” into buying homes they can’t afford.
Said the President: “We don’t want to go through anything like this again.”

So why am I posting this?….. To further point out how important it is to have legal representation when you are purchasing a home.
The President used the word “tricked” and that is exactly the issue in the current residential climate. Many parties involved in a transaction do not have your interest in mind and will do whatever they have to do to earn their fees, with total disregard to the impact on you as the Buyer.

Don’t be tricked! Don’t wait until legislation is passed, be proactive and look out for your own deal! Retain me before you sign anything so I can advise you every step of the way and give you a legal inspection of your deal.

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Some tips/thoughts for Buyers

Monday, June 14th, 2010

Purchasing residential real estate can be very stressful which is why I always recommend that buyers and sellers have an attorney who practice in real estate ( me) represent them throughout the deal. Here are some good random tips for Buyers based on issues I see come up often….

GET PRE-APPROVED FOR A MORTGAGE BEFORE YOU MAKE AN OFFER.
When you are trying to buy a house in a competitive market, your offer to purchase should contain as few conditions as possible. Conditional offers based on obtaining financing are often a deal killer. The seller may accept a competing offer for less money rather than take the risk that you won’t be able to raise mortgage money. A pre-approval letter from your lender tells the seller you are ready and able to commit.

DO NOT ACT ON EMOTION WHEN MAKING AN OFFER.
When you act on emotion, rather than reason, you may end up paying too much money. This can happen when you fall in love with a particular house and start picturing how great it will be to live there. Another reason you may be driven to pay too much is that a bidding war triggers your competitive instincts and you must buy the house at all costs – which you will regret later.

PUT MONEY ASIDE TO COVER SETTLEMENT COSTS.
You’ve put together a down payment. However, be aware that there are also a list of expenses you may have to pay at closing. Settlement costs can add up to between two and six percent of your deal. Your lender must give you a Good Faith Estimate of the loan-related fees you’ll have to pay. In addition most counties and each state have a real estate transfer tax due at settlement. Have the title company give you an estimation of what you will ultimately need at closing.

INSIST ON A HOME INSPECTION.
This is perhaps the most important item you should do as a potential home buyer. Make sure you have this item selected as a contingency in your Agreement of Sale. You need to have a thorough review of the property so you are educated on any issues it may have before you continue with the purchase. If the seller won’t help bear the costs, or adjust the price, you may still want to go ahead with the purchase, but make sure you can afford the necessary repairs on top of your mortgage.

DO NOT DO A DOUBLE MOVE
If possible, avoid a situation where you’ve got to camp out with relatives or find a short-term rental because you must vacate your old house or apartment before you can move into your new digs. Moving once is enough.

MOST IMPORTANTLY
No matter what stage of your transaction, a smart buyer ( or seller) retains an attorney who is well versed in residential real estate transactions.

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Good website for Philly area Buyers and Sellers

Wednesday, June 2nd, 2010

I periodically look around the internet to find web sites that I think are easy to navigate for residential buyers and sellers. This particular website seemed easy to navigate and is pretty straightforward. It is run by a Realtor named Frank Grabon and mostly covers Abington, Bensalem, Feasterville, Huntingdon Valley and Northeast Philadelphia. I do not know this particular Realtor but I liked the simplicity of the site thus I am posting a link to the site.

No matter if you are a Buyer or Seller, while a Realtor can be important in the sales aspect of your deal, do not forget the critical element of having an attorney who is familiar with residential real estate documents, review your transaction with a “legal inspection” of your deal. Contact me and I will review your deal and give you peace of mind!

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Home Buyer Tax Credit Ends Soon

Friday, March 26th, 2010

I was speaking with one of my favorite Realtors Jennifer Hohenberger of Coldwell Banker Preferred in Exton, PA ( check her out, great website www.jennsellshouses.com,  she is knowledgeable, all the credentials!) and we were talking about the soon to end tax credit for first time home buyers and the credit for repeat home buyers. These are great credits to obtain but are set to expire soon.

In order to receive the $8,000.00 credit for  first time home buyers  or the $6,5000.00 for repeat home buyers you must have an Agreement of Sale in place by April 30, 2009, and settle by June 30, 2010.

There are several criteria to qualify for the credits so I suggest you you click this link to see a clear and concise explanation of how to qualify. If you are seriously thinking about making a purchase you should act now on finding a property so there is enough time to have an sales contract in place by April 30, 2010.

If you have any questions please feel free to reach out to me on my website or call me at 215-253-8494

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Best Interests In Mind?

Monday, February 22nd, 2010

I just got off the phone with a woman who contacted me through my website with a situation that I sadly hear more times than I would like.

She had to put her home up for sale last year due to financial difficulties. She hired a Realtor who made assurances that the home, with proper marketing, would reach its price. As time moved forward, it became apparent that the contract price would have to be lowered to get more potential buyers interested.

A Buyer was eventually found but as the market continued downward the price had to be adjusted downward,  and this Seller was desperate.  In her multiple discussins with her Realtor, the Realtor assured her the price would be met but at settlment it was not. She had no choice but to sell the property at a loss or risk  being sued.  She is currently in bankruptcy becuase the loss crushed her finacially. The Realtor advised her there was nothing she could do.

I mention this cautionary tale not because it is an every day occurrence but to remind consumers to be very careful that if  you hire a real estate sales person, you carefully check their credentials and be sure that your best interests are in mind, not the agents commission, when you place a property on the market.

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Obtaining the $8,000.00 Tax Credit

Friday, January 15th, 2010

I am frequently asked about the $8,000.00 tax credit for first time home buyers. There is some level of confusion regarding how you obtain your tax credit. Here is a good article from CNN explaining that you can no longer receive the credit by electronic filing, mostly because of the high levels of fraud committed by scammers.

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Welcome

Tuesday, January 12th, 2010

Hello to all who come to jafferealestatelaw.com. I have updated my web site and will be updating my blogs frequently, so please navigate through my site for up to date information that I think may be helpful from a legal perspective as you embark embark in the world of real estate.

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Extension of Tax Credit and New Program

Thursday, November 5th, 2009

Great news coming out of Washington DC for residential purchasers!

First-time home buyers have been getting tax credits of up to $8,000 since January as part of the economic stimulus package enacted earlier this year. But with the program scheduled to expire at the end of November, the government extended and expanded the tax credit to include many purchasers who already own homes.
Buyers who have owned their current homes at least five (5) years would be eligible for tax credits of up to $6,500. First-time home buyers — or anyone who hasn’t owned a home in the last three (3) years — would still get up to $8,000. To qualify, buyers in both groups have to sign a purchase agreement by April 30, 2010, and close by June 30.

Keep in mind that the credit is available for the purchase of principal homes costing $800,000 or less, meaning vacation homes are ineligible. Also, the credit would be phased out for individuals with annual incomes above $125,000 and for joint filers with incomes above $225,000. For those in the military, the credit would be extended an additional year, until June 30, 2011, for members of the military serving outside the United States for at least 90 days.

So purchasers can now breath a bit easier at least until April 30, 2010 if you want to qualify for the credit.

While you are breathing a little easier contact me if you have any questions.

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Watch for “Administrative Fees”

Wednesday, September 16th, 2009

Welcome back to my blog, for those of you following along I have not written in a few weeks but now summer has ended and I am back!

In this post I will talk briefly about a topic that comes up frequently and that is the fees charged by real estate professionals ON TOP of the commission they earn from you as the client.

Often this fee is set unbeknownst to the consumer when you engage the services of a Realtor or broker. This fee is often buried in the contract so often you do not know you have even agreed to it. Read your documents carefully, contact me, and DON’T AGREE TO IT! If you do happen to agree to the charge it will reappear at your closing on the HUD-1 settlement sheet on page 2 in line 704 and is characterized as an Administrative Fee or a Broker Service Fee. Generally, the amount within the range of $175.00 to $375.00.

This fee is nothing more than that of a cover charge like you would see in a club for just walking in the door. I believe that it is a charge that has no value. Usually the “services” they are offering under the terms “Administrative Fee” or a “Broker Service Fee” are the same services that either must perform or should be performing on your behalf, to earn their already significant commission!

I sympathize with the professionals that their job is not easy during these difficult housing times but these additional fees are not the proper way to earn money.

Do your work and question them as to why if you are already paying a commission should you also be charged any additional fee for the services already expected. Bottom line… don’t pay any fees that have no value. Read your documents and contact me before you sign!

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