Question: My husband and I both have commission-based work. He's been working for three years at the same company and I've been working for less than a year. He has a job lined up in another state and we're looking into buying a home there. Will we be able to close on our new home if my husband resigns from his current job before the settlement date? Or should he stay at his job now until after the closing? I feel we have enough money to survive a two-month transition period (even longer, if need be) but we need to know if temporary-unemployment will be an issue during the underwriting process.
Answer: If you're moving to another state the first question a lender will ask is how you intend to pay the mortgage. A letter from a new employer showing work in the same field will be sought for each of you.
As to having enough cash to survive a two-month financial drought, that's not nearly enough to protect your interests. You want more in the bank in case unexpected expenses arise, the job falls through, you are unable to get work, etc.
Question: My mother purchased a house from an individual. Once the house of was paid off the deed was never forwarded. Time passed and the owner died, but the wife is still living. What rights do we have to obtain the deed?
Answer: Did you pay off a "mortgage" or a "deed of trust"? With a deed of trust there is a trustee who is responsible for collecting payments, ordering a foreclosure if necessary and providing a release once the debt is paid off.
As this is an estate situation, is there an administrator you can contact? Have an attorney write the widow an appropriate letter explaining how everyone will benefit from a quick resolution of this problem; include the forms needed to complete the release and be sure to provide evidence that the loan was fully re-paid. Then have the attorney enter the release in the local property records.
Question: I was wondering if you might know how to retrieve information regarding rental properties. Are there any sources to get information for rental comparables?
Answer: Local MLS systems can have extensive rental information. In addition, you can track rental ads in local newspapers.
Question: I'm a real estate salesperson. I recently sold a large property which closed and now is being develop into two dozen condos. My partner and I secured an exclusive listing to market the condos once they are completed. What happens if we leave our current broker and go to a competitor. Do we lose the commissions from our listing?
Answer: You don't have a listing. You never had a listing. What you have is a situation where you work under the authority of a broker. The listing is an agreement between a seller and the broker.
What you might have, and what you should have, is a written independent contractor agreement between you and your broker that assures you will be paid for the work you produce and which explains what happens in the event of separation. Absent such a written agreement everything is debatable.
Do you have written documents outlining commission arrangements? What has happened to other salespeople who left the broker? See what the paperwork says and then try to work this out with the broker.
Question: When we tried to schedule a utility hookup we discovered that our section of the street is spelled with two "n's" while the majority of the same street is spelled with only one "n." Our MLS listing, all advertising, and the purchase agreement we signed all indicated the single "n" spelling.
The school zone was our primary determinant in choosing the home. The portion of the street with one "n" goes to a good school, while the street with two "n's" goes to a bad school.
Can we terminate our purchase agreement and get our full deposit back?
Answer: You likely didn't buy a property at a given street address, you bought a property according to its legal description. As well, what -- exactly -- makes one school "bad" and the other "good"?
Did the owner or the owner's broker tell you which school served the property? Did you have a buyer broker?
A real estate agreement prepared by a broker should be accurate, definite and precise. You could argue that the broker who wrote the agreement was selling a property that was not actually listed -- the one with an additional "n." You might also demand that the sellers give you title to the property with the extra "n" -- a property they do not own and thus cannot sell.
Most likely, all parties will mutually want to end this agreement before falling into a bottomless pit of claims and counter-claims. For specifics, please contact a local attorney.
Question: We're interested in purchasing a particular home. The house's listed square footage is 3,425. However, the tax records indicate that it has 2,668 sq. ft. Even at the listed square footage, the house is valued at $715,000. At the tax records' square footage, it's only $560,000. The asking price is $800,000, and their agent says they won't come down more than $15,000 from that price. It has been on the market for 9 months. Aside from an all-cash deal, how would this house secure a loan if it doesn't appraise? Can we have it appraised before we make an offer?
Answer: You can make an offer contingent on an appraisal report from an appraiser of your choice that must be "satisfactory" to you.
As to the square footage, that is fertile ground for debate and discussion. Why? There is no standard measure of square footage.
The Z765-2003 Protocol from the American National Standards Institute (ANSI) addresses "the procedures to be followed in measuring and calculating the square footage of detached and attached single-family dwellings, including townhouses, rowhouses, and other side-by-side houses in the United States."
Okay, if there are "standards" then why not use them to measure square footage? Here's why: the "standards" are optional.
Question: I'm approximately 40 days into a 180 contract with a broker. The service I'm receiving is very poor and I find myself having to call the broker regularly to ask him for feedback on showings, current advertising and open-houses.
I have spoken with the agent's managing broker about the problems but he is as disinterested as the agent.
Can I end the listing agreement prematurely and without penalty?
Answer: It is not in the broker's interest to continue with a dissatisfied client. Some listing agreements have a clause built-in which allows for early termination at the option of either party. If you do not have such a clause then speak with the broker and explain that you want to end the listing. Most will agree immediately, though some may ask to be reimbursed for their hard costs such as advertising expenses.
Question: A foreclosed property is listed in a neighborhood where the houses are worth approximately $350,000 to maybe $600,000. The property is huge and entirely too big for the neighborhood -- it originally listed for $1.6 million. It has been foreclosed a couple of times and re-sold for $500,000 and $600,000. The foreclosure price now is $405,000. The catch here is the property was never completely finished. Looks like each time the owners just ran out of funds and left it. First glance to me indicated that at least $100,000 to $150,000 in repairs will be needed, maybe more, to finish.
This probably isn't something a novice investor should tackle, but it intrigued me to ask a question: How will the bank handle something like this? Who would purchase a house valued at $1.6 million and then spend the money to repair and upgrade it, knowing it would be hard to get any value from it? Why would a bank loan the money for a property like this?
Answer: If the home is being foreclosed by a lender it means that at some point a loan was made against the property. At the foreclosure sale, the lender will seek a minimum price -- just enough to repay the debt and closing costs. Anything above that goes to the borrower and former owner.
Also, the property is not worth $1.6 million. It can't be sold for anywhere near that price judging from past sales. It may not be worth the $405,000 now sought by the lender. One problem is that it's unfinished and final repair costs are unknown. A second problem is that the property violates a basic "rule" of real estate: Buyers seek the least expensive home in the most expensive neighborhood they can afford. This property is far more expensive than neighboring homes.
Question: I may be relocating to Florida in six months. Currently I own a home in another state and would like to rent it out should I move to Florida. If I move to Florida I would also like to purchase a home in Florida.
The problem is that I do not have money for a down payment or closing cost for a new property. Should I refinance my house before I move and take the refinance money to prepare my current house for rental and to put money down on a new home? Or, is it possible, since I have equity in my home the bank may not ask me to put down a down payment?
Answer: You don't really know if you'll move to Florida in six months. You may be staying at the current property. Rather than refinance the loan now in place, you may qualify for a fixed-rate home equity loan. Or, if you elect to sell you could obtain a "bridge" -- a second loan on your current home that can be used as a down payment for a replacement property. When your current home is sold the bridge loan would be paid off at closing. For details, speak with local lenders.
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