Residential and Commercial Real Estate Contracts
The purchase and sale of residential property, commercial property or vacant land can be an exciting endeavor that begins with a carefully constructed contract. Before you sign on the dotted line, consult with an attorney who will make sure that your best interests are protected. In many cases, your attorney can enter into skillful negotiations that will save you money, time and hassle by pointing out short falls you may not have otherwise been aware of.
A purchaser’s attorney must carefully review the property’s title work to make the buyer aware of any liens, judgments or exceptions to title that could potentially affect ownership. The physical condition of the property and accompanying surveys should also be examined for any defects that may need to be cured. Both buyer and seller will need to carefully review closing documents and the settlement statement (HUD) with their attorney for accuracy. After all, your goal is to arrive to the closing table with comfort and ease. Our goal is to get you there.
Conveyance of Property
For many of us, our homes and other forms of real property are our most prized possessions. Ensuring that they pass to whom we want, when we want, is a high priority.
The conveyance of real property should be preceded by careful planning. Depending on your unique circumstance, a specific estate will need to be created to ensure that you create the conveyance that will achieve your estate planning goals and in most cases, avoid probate.
Here are a few things to consider:
Tenancy by the Entirety: An estate created for husband and wife. Under the law, the marriage is the owner of the property. In the event of death of one spouse, the surviving spouse would own the entire interest.
Joint Tenants With Right of Survivorship: An estate for two or more people in which the interests are equal and the tenants have the same rights of possession and use. Death of any joint tenant results in the survivor tenant owning the entire estate.
Tenants in Common: An estate for two or more people in which their interests may or may not be equal. If a tenant should die, his or her heirs would receive the interest in the property subject to probate administration.
Life Estate: An estate for the duration of a person’s life where upon the death of the life estate holder, the remainder interest vests in a named beneficiary.
Planning is the key to success. We encourage you to learn more about deed selection, gift and estate tax concerns, the effect of judgments/tax liens, homestead protection and more!
Mortgage & Security Agreement
All conveyances or other instruments of writing which are designed to sell either real or personal property, while securing the payment of money is a mortgage. Mortgages are becoming a popular tool for real estate investors because the mortgage creates a lien against the property. In the event of default by the borrower, the lender can foreclose the mortgage to recover the initial investment. As such, the mortgage must be satisfied before title to the property can legally vest in the borrower.
Promissory Note: A promissory note is executed in accordance with the mortgage and sets forth the terms and conditions under which the mortgage is to be paid.
Personal Guarantor Agreement: Financial institutions often require that credit risky loans are further secured by a personal guarantor to ensure that in the event of default, the lender can pursue this additional avenue for repayment of the debt.
Assignment of Note and Mortgage: Assignments are executed in the event either the borrower or lender chooses to assign or transfer their interest in the mortgage to a third party.
Amended Mortgage and Promissory Note: Amendments become necessary when the lender and borrower agree to amend or change provisions of the original mortgage and note.
Future Advance and Consolidation: A mortgage may provide provisions to secure not only existing indebtedness, but also future advances up to a predetermined amount. The advance shall be secured under the existing mortgage.
Satisfaction of Mortgage: Satisfactions are executed and recorded as evidence that the debt has been satisfied.
A 1031 Exchange allows tax payers to defer capital gain tax, depreciation recapture tax and state tax (where applicable) while selling properties for a profit. That’s right. You can make a profit and not pay taxes! The key is the reinvestment of net proceeds from the sale of investment or business property into another property of like-kind nature.
By completing a 1031 like-kind exchange, you not only have the benefit of tax deferral but you will have 100% of your net proceeds from the sale of your investment or business property available to reinvest. This will allow you to trade up in value and improve your cash flow.
This investment strategy is strictly governed by the Internal Revenue Code Section 1031. It is important to consult with legal counsel who has experience in this area and will work closely with your qualified intermediary to ensure your success.
Call our office to schedule a brief complimentary telephone conference with one of our attorneys, to discuss your real estate matter.