Legal
{ Monday, February 20th, 2012 }
Advice On Buying A Foreclosure
I receive dozens of email newsletters each day. Many don’t seem to deliver anything of actual value- they’re essentially thinly veiled sales pitches. Others, like the one that I receive from Atlanta closing attorneys Neel & Robinson, are chuck full of good real estate information.
Here’s some advice that they just sent out regarding the purchase of a foreclosures (or as banks often times refer to them as, REO properties). For those of you thinking about buying a foreclosure in a community with a homeowners assocation (townhomes, condominiums, etc.), this is a pretty important read:
When an REO (“Real Estate Owned”) property is being sold, there are several additional steps, considerations, and possible delays if the property is a condo or in any kind of HOA (Homeowners Association). Each of these steps can add days to the pre-closing period, due to the difficulty in getting information and getting the seller’s approval.
Here are the steps involved with every REO property that has mandatory dues:
- The closing attorney must have a copy of the recorded DUP (Deed Under Power = foreclosure deed) to order the HOA letter. The HOA dues prior to the foreclosure date are wiped out, but the HOA must see the actual recorded DUP before providing a status letter.
- Need contact name, phone, email for the HOA – the foreclosing bank has never had any contact with the HOA, so the listing agent needs to investigate and then provide this info to the closing attorney.
- Many HOA management companies now require prepayment (by credit card) from the seller or listing agent to release the HOA status letter. These fees can run as high as $175. The closing attorney can order the letter, but the HOA will not release the letter without the payment prior to closing.
- The seller’s attorneys usually require a longer review time if there is an HOA, sometimes up to a week, once the HOA letter is prepaid, prepared, and received. This is in addition to the standard 72 hours the seller’s attorneys require to review the final HUD-1.
Edit Credit: Neel & Robinson (note that all hyperlinks were added by A is for Atlanta)
{ Wednesday, July 20th, 2011 }
Where Is Atlanta’s Safest Neighborhood?
Do not rely on a dog in a trench coat to decide if a neighborhood is safe or not.
Which is Atlanta’s safest neighborhood?
They’re all safe, and at the same time, none of them are.
Confused? You’re not the only one.
Think about it this way: the 35-year-old me probably wouldn’t live where the 25 me lived. Who knows what the 45 me will think about where I live now, and all bets are off when it comes to the uber-judgy 55 year-old me.
The reason why I even bring this question up is because as a Realtor, I’m often asked if a neighborhood is safe. Given the subjective nature of the question, it’s hard to answer with a simple yes or no answer: what one person thinks is safe, another might consider dangerous. Take the recent news of car break-ins in Buckhead and Inman Park, or the tragic shooting in Midtown. Does that make these neighborhoods unsafe? I think you get my point.
That said, it’s incumbant upon all of us to do our own due diligence when it comes to personal safety. There are tons of resources out there- from the AJC’s Crime Database to the GBI’s Sex Offender Registry, but there’s also a more practical approach: visit a neighborhood at various times of the day. See what it’s like in the middle of the day, take a drive through after dark. If you’re seriously considering buying or renting in a neighborhood, spending a few minutes there is a much investment in your future than relying on one guy’s opinion!
{ Wednesday, December 1st, 2010 }
When Bad Homes Happen To Good People
Catching up on some reading over the Thanksgiving weekend, I came across an article about a Philadelphia couple that recently bought a home with some significant issues. Turns out that their “dream house” was in fact a former “meth house”. Nothing funky had turned up in the home inspection so it wasn’t until they moved in that they started to feel the effects of the narcocized home.
If this is the den in the home that you're thinking about buying, you may want to think twice.
How could this have been avoided? OurMethHouse, a website dedicated to the subject, provides the following tips to home buyers. It sort of reminds me of Jeff Foxworthy’s “You Know You’re A Redneck” routine. In his spirit, I present to you: “You Know You Might Be Buying A Meth House When…”:
* Unusual, strong odors (like cat urine, ether, ammonia, acetone or other chemicals).
* Renters who pay their landlords in cash. (Most drug dealers trade exclusively in cash.)
* Lots of traffic – people coming and going at unusual times. There may be little traffic during the day, but at night the activity increases dramatically.
* Excessive trash including large amounts of items such as: antifreeze containers, lantern fuel cans, red chemically stained coffee filters, drain cleaner and duct tape.
* Unusual amounts of clear glass containers being brought into the home.
* Windows blacked out or covered by aluminum foil, plywood, sheets, blankets, etc.
* Secretive / protective area surrounding the residence (like video cameras, alarm systems, guard dogs, reinforced doors, electrified fencing).
* Persons exiting the structure to smoke
* Little traffic during the day, but high traffic at late hours; including different vehicles arriving and staying for short periods of time.
* Little or no mail, furniture, visible trash and no newspaper delivery.
Of course, some of these criteria apply to thousands of non-meth lab homes out there, but if you find yourself checking off multiple attributes, you may want to have the home tested for narcotics. A quick peak at the U.S. Drug Enforcement Administration’s National Clandestine Laboratory Registry might not hurt either.
The granite countertops and wooded lot might be eye catching, but if your dream home is a “meth house”, you definitely want to know prior to closing.
{ Monday, October 25th, 2010 }
Are You Taking Care Of Your Sidewalk?
If this was in front of your house, would you pay to repair it?
If you live in the City of Atlanta, you are responsible for the sidewalk in front of your house. This probably comes as somewhat of a surprise, as most major cities allocate funds to repair sidewalks. If you’ve ever spent some time walking in Atlanta, then you know Atlanta’s sidewalks can be pretty treacherous.
Sally Flocks, CEO and Founder of the Atlanta-based pedestrian advocacy PEDS has a great piece on the topic over at Saporta Report. A few gems from the piece:
“The City doesn’t ask property owners to repair potholes on streets adjacent to their lots. Likewise, it shouldn’t delegate sidewalk maintenance to abutting property owners.”
And…
“Sidewalk maintenance is a basic service of municipalities and should be funded by all taxpayers, not just adjacent property owners. The use of public money to build sidewalks makes sidewalks public assets, just like the streets.”
I’m not looking to get overly political at the height of the political season- especially over an issue that’s not even remotely on the table- but if you think this is a foolish policy, let your City Council member know. I’m sure they’d love to hear from you.
Photo Credit: PEDS Website
{ Tuesday, October 12th, 2010 }
Tips On Buying A Foreclosure
Foreclosure Drive, just between St. James Place and Tennessee Avenue
Hard to say how great an impact the recent hullabaloo over foreclosures will have on the Atlanta market, but one thing is for sure: buyers of foreclosed properties need to do their due diligence. Atlanta law firm Neel and Robinson hit the key points on the head in a recent email. The cut and paste, below (with hyperlinks courtesy of A is for Atlanta):
When a foreclosed property is being resold by the lender, the buyer is usually asked and often forced to close with the law firm chosen by the seller. Many buyers and their agents are starting to assert their wishes to close with their choice of attorneys.
Regardless of which attorney handles the closing, the buyers and their agent should always confirm the following when buying a foreclosure:
- County and city property taxes
- Confirm payment on the HUD if the current bill is out.
- If paid prior to closing or “POC” (paid outside closing), ask for written proof.
- Tax prorations – check the calculations, because the seller will not adjust the prorations later. If prorated on last year’s estimate, make sure it is reasonable and reflects any major changes such as the loss of homestead exemption.
- Other bills not wiped out by foreclosure
- City/county garbage and sanitation bills
- Water bills on previous owners in the chain of title
- Demolition liens and other government bills
- Homeowner Association
- Is there a mandatory HOA? (The seller bank may not know for sure; ask the closing attorney)
- Has the HOA account been adjusted since the foreclosure?
- Make sure the closing attorney has a written status letter from the HOA – get a copy at closing.
- Is the seller paying the dues from the foreclosure date up to the closing date?
- Owner’s Title Insurance
Never buy a foreclosure without title insurance – the seller does not guarantee clear title (just insurable title) and will only sign a limited warranty deed to the buyers.
