Category: Lawyers

Disaster Preparedness Tips Real Estate Buyers Need to Know

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Real Estate investment might be one of the things that will take a massive chunk of your finance. Since this investment appreciates as the years go by, it is paramount to be disaster prepared at all times.

No doubt, disaster preparedness is a topic that many real estate tycoons dread. It goes beyond mere home inspection, but rather being real about likely uncertainly that might occur like a flood, fire outbreak, etc.

As a real estate owner, you probably do not want to lose your investment in an instant. That is why you’ll find this article helpful in preparing for disaster.

  1. Evaluate Potential Risks

The first step to being ready for any disaster is to evaluate your property and identify key potential risks. By determining what could occur in your property, you can better plan or strategize on fixing the loophole.

For instance, a property prone to flood might need a different plan or constant monitoring of the water levels. If, perhaps, your property is situated close to the fault lines, then coming up with an effective strategy to mitigate the situation becomes the next step.

  • Protect With Insurance

Before you close your housing deal, you need to make sure that your house has insurance coverage. Go through the insurance policies and determine what is insured and what is not. 

It is essential to protect your property through insurance, as that is the best way to prepare for disaster. However, there are choices to make when it comes to insurance. You must understand that no property is invulnerable to fire, flood, earthquakes, or other disasters.

But with insurance coverage, the impact of the disaster wouldn’t be profound compared to when you have no insurance. The type of insurance policy you go for depends on your risk assessment and what you believe to be a potential risk.

  • Have A Disaster Plan

When a disaster happens, it takes almost everyone unaware. Despite our current technological feat, the time of tragedy is often known, so having a disaster plan is the key to being prepared.

You can start by getting involved with some organization that aims at training people to prepare for disaster. Most of these organizations have the knowledge when it comes to strategic approaches.

Remember that being prepared for disaster wouldn’t only help save your property, but lives as well. That is why you need to take disaster preparedness seriously.

  • Have A Recovery Plan

Uncertainties are hard to prepare for, but being prepared ensures that you limit the damage caused. Part of disaster preparedness is to have a recovery plan. That way, you can bounce back on your feet without issues. 

Part of the recovery plan could be making contact with critical individuals or agencies. Irrespective of how equipped and ready you are, you’ll need a workforce.

Conclusion

Preparing for a disaster can help one to mitigate the damages. It can also be a great tool that allows one to recover quickly in the face of emergencies. Before closing that real estate deal, ensure your new home is insured, and a disaster plan if the inevitable hits.

Credit Mistakes That May Keep You From Buying a Home

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Before you think of buying a new home, it is necessary to determine if your credit score is in excellent shape; when reverse is the case, your dream of owning a new home might dash to pieces.

Having a good credit score will always work in your favor since you wouldn’t have issues getting your mortgage approved. A bad credit score, on the other hand, does more harm than good.

As you try to find your way around the home buying experience, here are some credit mistakes you probably should avoid.

  1. Forgetting Your Credit Reports

When you apply for a mortgage or seek a loan from a lender, what they often go through is your credit report. It will enlighten them on your financial capacity, and also stir their decision.

Since they will be looking at this credit report, you must know what’s there before you sit with your bank or lender.

You can pull out your credit reports from one of the major credit bureaus like Equifax, Experian, and TransUnion.

  • Late Bill

Aside from your credit report, another mistake you shouldn’t make it paying your bills late. It can be a glaring red sign, and lenders don’t like late bills.

Although your credit score is a huge factor, your payment history is also something that is hardly ignored. That is because it shows how financially responsible you are.

When you make a late credit loan or, perhaps, student loan, it shows you can’t keep up with your bills. 

  • Going On A Shopping Spree

A new home entails shopping for some home appliances, furniture, and lots more. But wait, you don’t have to dabble into that just yet.

When you max out your credit card or maybe open some new credit accounts, it could hurt your credit score, which can be saddening.

It would help if you didn’t make any substantial financial moves to avoid making a mistake. 

  • Falsely Disputing Negative Items On Your Credit Report

You are eligible to dispute some inaccuracies in your credit reports, such as charge-offs and late payment. 

However, do this only when you’re convinced that the information is inaccurate. If there were indeed an error, it would take your credit bureaus about 30 days to ratify the issue. 

If there were an error, the negative mark would be erased almost immediately.

  • Accepting Bad Loan Terms Due To Poor Credit

It is one of the biggest mistakes you shouldn’t make since it never plays in your favor. As much as you need your new home, you shouldn’t get it under a bad credit score.

That will only mean lousy loan terms, higher interest rates, and high monthly payments. No matter how tempting it might be, resist the urge to acquire a loan using a bad credit score.

Conclusion

Many people have made these credit mistakes when buying their first homes. But if you can avoid it, it makes everything less hostile and manageable to pay off. A good credit score is vital for lasting peace of mind.

Challenges of Investing in Real Estate and How to Face Them

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Most people invest in real estate for monetary gains, while others need to acquire a home of their own. Since real estate involves an enormous financial commitment, there are some challenges you might need to navigate through.

Here are some of the challenges in real estate and how to face them. With the right tips, you wouldn’t have a problem in this sector.

  1. Pursuing High Returns

There is absolutely nothing wrong with going for a deal that promises higher returns. But don’t be myopic when handling such an arrangement, as you might find yourself overlooking the house’s overall quality.

You don’t need to find yourself in the net of high-risk returns vs. High-risk purchase. You can strike a balance between these two factors. That is, the risk returns compared to the risk purchase.

  • Unrealistic Property

Many real estate tycoons believe there is no perfect property out there. They could be right or wrong, but getting that ideal investment property is rare and very unlikely.

The housing industry is very tight, and finding such rare pieces is often impossible. There is no need to wait too long and to block your fund in the meantime. Let go of every unrealistic expectation and go for the best option.

  • Buying At The Wrong Time

Getting the perfect deal is about timing. Sadly, no person, agency, or software chips out the ideal time to buy a house. In that case, you’ll need help from professionals and veterans to save you from a bad investment. 

By seeking the help of experienced and successful real estate tycoons, you might grasp one or two tips that will help you invest right.

  • Maintenance Of The Property

After the closing day, another challenge that might arise is the maintenance of the property. Although these factors may have been addressed before closing the deal, there is always a chance of the inevitable poking its face up. 

It could be a political or social situation that might cost the owner a considerable sum of money. There could be a natural disaster that might pull off the roof, windows, or doors. When such happen, you should be ready to fix them.

  • Regulatory Bodies Of The City

The last thing you need is to be in the black book of regulatory bodies like the PMC. Landlords or house owners must abide by these bodies’ rules and regulations, which also include taxes. Failure to adhere might attract some fines or penalties.

Facing These Challenges

A common way to manage these challenges is through research, and there are lots of content on the internet. When you’re equipped with the right information, tackling these challenges becomes easy but to crack. Through forums and popular platforms like Quora, you’ll be properly guided on the right cause of action.

Conclusion

Challenges exist in every facet of life. The problem most times is: how to mitigate these challenges for the best result. With the tips in this article, you wouldn’t have a problem making the right real estate decisions.

Legal Real Estate Investing Tips To Know

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When it comes to the investment arena, it is paramount for every investor to be conversant with the legal procedures. That way, they don’t default in any laws that might lead to a lawsuit. It is essential to look at these standard procedures are a guide, not as obstacles. Before you dabble into an investment, you also need to understand how to protect yourself legally.

Hiring a lawyer is one step, as your lawyer will ensure you always thread the right route. During a contract, your lawyer will help both in interpretation and helping you make the right decision. Your lawyer can also perform a title search to avoid someone coming in the future to claim the property.

Without further ado, here are some legal real estate tips you should know

  1. Getting Insurance For Your Property

Insurance is an important aspect that every wise investor must not ignore. That is because it saves you in terms of the inevitable or uncertainties. Imagine getting a house, and after renovation, a catastrophe beyond your control occurs,

When your property damages due to a natural disaster or theft, insurance will help recoup and possibly fix every damage. There are lots of insurance policies that you can sign up for that offer such coverage.

  • Prepare A Contract That Protects Your Investment

Another legal tip every investor must never overlook is the preparation of a contract for their tenants. Most investors think the leasing agreement is all that is needed. However, there are numerous other ways to protect yourself and your property, and it entails getting an indemnity agreement with your tenants.

 What this agreement does it to exonerates you from all liabilities that might arise. If your tenant or someone else was harmed on your property, your tenant takes full responsibility without your involvement.

  • Hire A Personal Accountant

It can be pretty expensive to hire a personal accountant, but doing so will save you tons of headaches and money in the long run. An accountant who is exceptional in tax laws in your state will find diverse ways to maximize your profit.

In other words, an accountant can structure your business in such a way that deductibles are made from your taxable income. That way, you earn more in the long run. Numerous benefits come with having an accountant, and it will be in your best legal interest to not neglect such a professional.

  • Use Company Name As Investment Owner

It is a simple investment tip that will save you lots of hurdles in the long run. When you run an investment as a business, you as an individual cannot be sued but instead the company.  It is probably the first thing business tycoons learn in business schools; unfortunately, most investors make the mistake of carrying out investment in their name.

Conclusion

These investment tips will ensure you don’t find yourself in an ugly situation as an investor. They are not there to limit you as an investor but, instead, protect and serve you in the world of investment.

How To Choose The Best Mortgage For You

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Buying a home could be one of the giant steps you will take in life. However, you will need to decide on the best mortgage that will appeal to you. There are different types of mortgage, and it is paramount you consider your options and choose the one you’re most qualified for.

In this article, you will learn some of the various mortgages and what makes each of them distinct. When you compare the edges one mortgage has over the other, it will help you choose the best.

  1. Traditional Mortgage Vs. Government Mortgage

When you’re setting out to make a decision, you will need to consider if you want to conventional or, perhaps, a government mortgage. As you might already know, a traditional mortgage comes with a private lender or a federal company that isn’t insured by the government.

If you don’t qualify for a conventional loan due to a low credit score, a government mortgage will be the ideal option for you. You will need a specific credit score, down payment, and a debt-to-income ratio for a conventional mortgage.

  • Conforming Vs. Non-Conforming Mortgages

If you have an impressive credit score, you might decide to seek for a conventional mortgage. In that case, there are two types of a conventional mortgage you should know – conforming and non-conforming mortgage.

The difference between these two mortgages is the amount of money you need to borrow. For a conforming mortgage, it has to follow the Federal Housing Finance Agency (FHFA) standards. As of the year 2020, the limit is at $510,000 in some US parts. In areas where the cost of living is pretty high, the limit has risen to $765,000.

A non-conforming mortgage, on the other hand, is for an amount that goes beyond the FHFA limit. Most of the time, it is referenced as a jumbo loan – precisely what it is.

  • Government-Backed Mortgages: FHA, VA, Or USDA Loans

There is often a looser requirement for government-backed mortgage regarding credit scores, debt to income ration, and down payment. You will still need to go to a private lender to get a government-backed loan. Please take note that you will even need to specify that you’re opting for a government-issued mortgage.

  • Fixed-Rate Vs. Adjustable Rate Mortgages

After making your choice, to either go for a conventional or government-backed loan, you have more options to make, which are fixed-rate and adjustable-rate loans. What these two types of mortgage focus on is the interest you pay on your loan.

For a fixed mortgage, it automatically locks in your rate for the duration of the loan. In the US, the mortgage rate is likely to increase or decrease. However, you will still have to pay the same interest rate in 30 years, just as you did in your first year.

Conclusion

Getting the ideal mortgage is possible when you understand the various types of mortgages at your disposal. If your credit score is perfect, with a large down payment and debt to income ratio, you can also opt for a conventional loan. But if there are some misfits, a government-backed loan will be ideal.

Getting A Mortgage After Bankruptcy

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Many consider bankruptcy as a nightmare, but it doesn’t have to be with a formidable plan. Nevertheless, it is a horrendous undertaking that one has to take when debt is becoming intense or overwhelming. Taking such drastic action will halt activities such as lawsuits and repossession.

If you’re comfortable with having this mark on your credit score for seven to ten years, not being able to seek or obtain a loan, then go ahead. If you’ve filed for bankruptcy in the past and you’re considering getting a mortgage, this article will no doubt educate you on what you need to know.

Impact Of Bankruptcy On The Ability To Get A Mortgage

Although the impact of bankruptcy can lessen with time, it limits your ability to obtain loans. It is possible to get a mortgage after bankruptcy, but it is a challenging process. Before a lender can give you the attention you deserve, the default has to be discharged.

Most lenders will take a look at your credit score to determine your creditworthiness. So, you must check your credit score report before you apply for a mortgage. In your credit score report, ensure there are no mistakes by correcting incorrect or outdated information.

If there is an error in your credit score report, do contact your credit agency to correct or update your information. When applying, your lender is most likely to ask you a few questions regarding your bankruptcy. Take note that the questions are merely to understand your financial capacity to stick to the agreement.

Mortgage Loans To Consider After Bankruptcy

After filing for bankruptcy, you need to apply for a mortgage with less restriction. There are many mortgages to consider, and they have their unique requirement for bankruptcy filers.

Here are a few mortgages that are less stringent and more comfortable to acquire.

  1. FHA Loans

The federal government manages this type of loan and allows you to buy a house with a down payment as little as 3.5% of the purchase price. The only downside with this mortgage is that you will have to pay for mortgage insurance, thereby leading to a high monthly payment.

  • USDA Loans

If you’ve found a home in a rural area, you should consider applying for this mortgage. The U.S Department of Agriculture is designed to meet a specific income requirement. If you’re viewing this alternative, you might not even need a down payment and it comes with a low-interest rate.

  • VA Loans

If you’re a veteran or perhaps, currently working with the military, you might be qualified for a Department of Veterans Affairs (VA) loan. This type of mortgage doesn’t require any down payment and the interest rate is ridiculously low. However, you will need to pay a funding fee, which is the percentage of your home price.

Conclusion

Applying for a mortgage after bankruptcy can seem pretty challenging. However, applying for the right mortgage will make a difference, as the requirement becomes lesser than a conventional mortgage. If you’re yet to start applying for a mortgage, perhaps you should consider the options in this article

Common Commercial Real Estate Legal Issues

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Commercial real estate deals need extensive experience to pull off, which is why you might need to learn about some potential legal issues that might spring up.

Aside from the financial aspect, which is sometimes an issue, there are numerous other legal issues that you might encounter during a commercial real estate deal.

These legal issues can put you at risk, costing you hundreds of thousands if not mitigated as soon as possible. In this article, you’ll learn about these common issues. That way, you will know of a way to navigate around them.

  1. Assumption Of Liability

When you purchase a property, you need to ensure you’re not liable to any legal violation or damages caused by the previous tenant. Failing to do this might lead to you being responsible for any damage. Not only will you be accountable for removing the threat, but you will also need to restore the property to a safe level.

When you acquire a property, ensure that it is insured in case of the inevitable or uncertainty.  By having insurance coverage, you cut down on the issues which you might have to face.

  • Liens On The Title

Before concluding any deal, you must ensure that a title search is done. It is done to ensure there are no liens on the property, which might affect your inability to sell the property. 

By working with a reliable and competent lawyer, they will conduct thorough research to ensure no liens on the property. Although the title search is pretty expensive, it will save you from many headaches in the long run.

  • Reps And Warranties

In the real estate world, representations are factual, while promises are indemnity for false statements. Ideally, most real estate buyers will want a full contract of representatives and warranties to verify their income, expenses, and the general condition of the house.

Most buyers of real estate might want a contract with few reps and warranties. Take note that every deal is different; that is why working with a reliable real estate attorney will serve in your best interest.

  • Zoning And Land Use

Most real estate buyers often run into this issue, and that is because proper research wasn’t done. It isn’t always wise to rush into a deal, but rather take your time to evade most zoning and land-use problems. Your attorney will help you decide if the land can be used in ways you intend to use it. Also, he will be in charge of getting the local permit for your business or new project.

  • Defects In Title

Although deeds are meant to show who owns the land, sometimes they aren’t recorded, listed, or perhaps match the proposed land. It might be impossible to avoid most of these commercial real estate legal issues, but taking your time before concluding a deal will save you a lot of stress.

Conclusion

Every situation or contract is different, so you need to trust your agreement the same. By working with a competent real estate lawyer, you will avoid most of these real estate legal issues that might spring up.

How To Protect Yourself From Real Estate Fraud

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Real estate involves a massive sum of money, making it a potential target for wire fraud and numerous other real estate illegalities. Whether as a real estate buyer or seller, you need to get yourself acquaint with these real estate frauds and common ways to protect yourself.

The complexities and rigorous processes involved in real estate deals make virtually all the parties involved vulnerable to these scams. According to real estate experts, referrals are the most trusted sources as it minimizes cases of fraud.

Types Of Real Estate Fraud

  1. Wire fraud

This type of fraud revolves around the closings when both parties are about to finalize the deal. The real estate lawyer could most commonly be the type that uses the same password for all his accounts. When a bad guy manages to access an account, the hacker can use the same password to access email.

Once they are in, they search for emails with phrases like ‘offer is accepted.’ They send a mail to the buyer, instructing them to make a payment to a shady account. Before the buyer could understand what has happened, the hacker is gone.

To avoid this kind of scam, call the real estate agent to confirm the mail before making any transfer. If possible, contact the Title Company or lender to ask if they send the mail. If they didn’t, you would know at the spot.

  • Identity Theft

You’d be surprised the length cybercriminals can go to steal your information. When they have your information, be ready for a long game. How this plays out is often interesting, and it usually when a data breach occurs. Most smart cybercriminals won’t do anything for six months when they gain access to your email.

The wait is often to gather enough data about you, and there are chances of getting your social security number while monitoring. A way around this is to always be at alert and not rely heavily on emails.

Before you start that real estate deal, make it a duty always to change your password as a precautionary measure. You might never know what could be lurking around the corner.

  • Title Fraud

If you deal with a reliable title company, you should be protected from this sort of scam. But on the other hand, title companies are not the same in terms of competence and reliability. In that case, you need to be cautious.

Just like emails, you’re not to rely heavily on them as they could fail. If you want to make sure you don’t ever fall into this type of real estate fraud, then a personal referral for lenders and title companies is best. No doubt, the recommendation is because they are reliable and competent.

Conclusion

If you want to protect yourself from real estate fraud, you should never be in haste. Before you take action, confirm through a phone call. Remember, it is your money on the line, and you want to make sure you don’t lose it.

How Much Does A Real Estate Lawyer Cost?

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As you may already know, real estate is a complex sector that comes with numerous processes. Thus, it is worth hiring a real estate lawyer to ensure you’re adequately represented. A real estate attorney will also help draft out the necessary documents; even negotiate on your behalf.

Lawyers are incredible individuals, but what is the average cost of a real estate lawyer? Will you be able to foot the bills?

The average cost for real estate lawyers ranges from $300 to $3,500, just for a simple buy and sell transaction. In most states, the prices will differ. So, it would help if you found out the current average cost in your state.

There are lots of factors that influence the cost of hiring a real estate lawyer. The more complex the transaction, the more they are likely to charge you. Since the role of a real estate lawyer is crucial, you can’t do without them.

Aside from the cost, they save you from making mistakes that could have incurred more expenses. Since this might be your most significant investment, you need to get it right. Remember, a massive sum of money is involved in this deal, and you don’t want to leave anything to chance or luck.

How Attorneys Are Paid

If you’re planning to hire a real estate lawyer, it is ideal to inquire about the average cost. It also depends on some factors, especially how the attorney wants to get it. The fee could be hourly, which typically range from $250 to $350.

In most cases, the lawyer will request a flat fee to prepare some vital real estate documents. The attorney might also offer some packages that allow him to handle the case from start to finish. Following this model, he will calculate how many hours he spends and the task completed.

Most lawyers offer a free consultation that allows you to know more about their packages and how much they charge. Aside from the standard hourly fees, some tasks accomplished by the lawyer may incur additional expenses.

Some of these tasks may include title search, preparation of the deeds, and numerous other documents. Before you hire any real estate lawyer, you must negotiate and be clear on the rates. That way, there won’t be any confusion of any sort during the transaction.

Payment In Advance

It all depends on the lawyer and how he operates. Most real estate lawyers will require a 50% advance payment while others get paid on the closing day.

If the transaction is complex, expect the fee to be higher. A real estate lawyer’s work is immense, which is why you need to get everything right when hiring a real estate lawyer. That way, you don’t make any mistakes.

Conclusion

A real estate lawyer’s cost varies depending on your state, the transaction’s nature, and tasks to do. But on the other hand, you don’t look at the rate, but rather at the property. You don’t want any issues that might arise in the future, so hiring a real estate attorney should be a top priority.

What Does A Real Estate Attorney Do?

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If you’re a first time home buyer, you might find yourself wondering what a real estate attorney does. Most real estate buyers or sellers often think that a real estate agent can play the role, but they are two individuals with different responsibilities and functions.

Real estate lawyers or attorneys review real estate transactions, including purchases and leases. In case there is a title insurance issue, they can help resolve such without hassles. If by any chance, something goes wrong, a real estate attorney is ever ready to step in and defend.

  1. Draw Up Documents

A real estate lawyer’s primary role is to draft out documents by preparing deeds for conveyance transactions, rentals, and more. Your real estate agent can help you fill those documents, but it is the job of a real estate attorney to draft and revise these materials.

  • Handle Transactions

When it comes to the rules and regulations guiding the real estate market, a real estate attorney is the best person for the task. A competent real estate attorney knows the ins and outs and can help their clients understand contracts, inspections, leases, and other legal processes involved. If you ever have a question, your real estate lawyer is ever ready to answer and guide you.

  • Negotiate Sweet Deals

Real estate attorneys have closed more deals than you could ever imagine. So, it is always good to leverage their sophisticated experience in the real estate market. You can allow your attorney to handle the negotiation, including the terms and conditions.

  • Engage In Litigation

When a real estate transaction fails to work out, your real estate lawyer must represent you. It often includes drafting legal pleadings to file with the judge. Also, your attorney will be there for your hearing, trials, or any other legal processes. In extreme cases, they could work out a settlement agreement.

  • Protects Clients’ interest

Your attorney can be a preventive measure against hidden legal traps. You can trust your attorney to protect your interest and ensure that the legal documents are authentic. If you’re in doubt, you can always ask your attorney to take a second look at the contracts. In the end, your interest will be protected, and you’ll have no cause of alarm.

  • Assist With Closing

The closing day is the most crucial in real estate transactions. Through your lawyer, rest assured that every purchase will be facilitated. Also, your lawyer can familiarize you with some of the hidden costs and other likely surprises. Since the closing day is the most important event, your lawyer will try to ensure it is successful and have no regret.

Conclusion

If you want peace of mind, hiring a real estate attorney is one of the first things you need to do before any other deals. Your lawyer will ensure your interest is protected, and your chances of making a mistake are also eliminated.