Q&A: Allowing Seller to Remain in Home After Closing

On November 12, 2010, in Real Estate, by Robbie L. Vaughn, Esq.

Should a buyer allow a seller to remain in the home after the closing?

Usually not a good idea.

The parties enter into what is known as a “Holdover agreement” or “Post-closing possession agreement.” We don’t normally recommend these agreements, but they are sometimes necessary.  Hopefully, the following will provide you with some insight as to why these agreements are not normally recommended by our firm:

The good

  • The deal gets done sooner rather than later.
  • The buyer leaves a hefty sum in escrow to cover “rent” and property damage.

The bad

  • The seller needs more time to move or refuses to leave as scheduled.
  • The escrow money is not enough.

The ugly

  • The seller causes serious damage to the property.
  • Legal action is required to recover possession of the premises.
  • Legal action is required to resolve a dispute over the escrow funds.

Please visit our Real Estate category to Learn more about real estate.

As always, The Law Firm of VAUGHN & WEBER, PLLC is here to assist you.  We are conveniently located in the heart of Nassau County, Long Island, at 217 Willis Avenue in Mineola, NY.  Contact us at (516) 858-2620 to speak with a real estate attorney.


Buying A Home

On May 28, 2010, in Foreclosure, Real Estate, by Robbie L. Vaughn, Esq.

The Home Buying Process

The Home Buying Process

Buying a home can be exciting and joyous. However, the home buying process can get a bit confusing at times. We often act as the buyer’s attorney during real estate transactions. In an effort to answer some of their questions, we provide our real estate clients with the following overview of a real estate purchase . We hope that you find it useful as well:

BUYING A HOME (an overview):*

1.   The Buyer usually contacts a Real Estate Broker to help locate a property he/she would like to purchase.

Real Estate Broker–  Any duly licensed or authorized person, firm, or corporation who for a fee or commission lists for sale, sells, or exchanges real property.

2.  The Broker helps the buyer find a home.**

3. The Broker usually conducts a Comparative Market Analysis to help determine the value of the home.

Comparative market analysis– An estimate of the value of a property based on an analysis of sales of properties with similar characteristics.

4.  The Buyer usually makes an offer by submitting a real estate binder.

Real Estate Binder–   An agreement intended to evidence a modest payment toward the purchase of real estate as evidence of good faith on the part of the purchaser and acceptance by the seller. (A real estate document generally used in residential transactions).

5.   Seller accepts or rejects the offer.

6.   Assuming the offer is accepted, the buyer then hires an engineer/home inspector.***

7. Once both parties have agreed to move forward, the seller’s real estate attorney drafts and sends a proposed contract to buyer’s real estate attorney.

8. Contract terms are negotiated by the real estate attorneys.

9. Buyer meets with his lawyer for the “contract signing.”

10. Buyer’s  real estate attorney collects the down payment check, which is made out to the seller’s real estate lawyer “as attorney,” to be held in escrow, by the seller’s attorney, until the closing.

11. The signed contract and Down payment are forwarded to the Seller’s attorney.

12.   Buyer receives a copy of the fully executed contract, signed by all parties. This is then used to obtain a loan  (Commitment Letter) if necessary.

Commitment Letter– A promise by a lender to make a loan with specific terms for a specified period.

13. Buyer’s attorney orders a title examination & survey.

14.   Once all issues are resolved and the lender gives a clearance to close, a real estate closing is set.

Real estate closing– The transfer of the real estate title from seller to buyer according to the sales contract. All parties, as well as a title closer and bank attorney, arrive to conclude the transaction.  The buyer receives the title and keys to the real estate and the seller receives the balance of the purchase price.

**The Broker will likely request/require you to obtain a mortgage pre-approval before they begin showing you homes.

***The inspection can be done after step 12 if the parties agree. This is usually accomplished by placing an “inspection contingency” clause in the contract.

As always, the Law Firm of Vaughn, Weber & Prakope, PLLC is here to assist you.    Contact us at (516) 858-2620 to arrange a consultation with a Real Estate Lawyer.

*The above is merely an overview of a real estate transaction. Additional and/or different steps may be required during a particular transaction. This is not legal advice. ++All rights reserved.

Please visit our Real Estate category to Learn more about real estate.

Inspecting New Constructions

On April 18, 2010, in Real Estate, by Robbie L. Vaughn, Esq.

Inspecting New Constructions

Inspecting new constructions

One good reason to have a newly constructed home inspected for defects:

New York law provides every purchaser of certain newly constructed homes with a statutory home warranty (the “Housing merchant implied warranty”). However, the warranty only covers certain latent (hidden) defects.

The Warranty statute states that:

“Unless the contract or agreement by its terms clearly evidences a
different intention of the seller, a housing merchant implied warranty
does not extend to….any patent defect which an examination ought in the circumstances
to have revealed, when the buyer before taking title or accepting
construction as complete has examined the home as fully as the buyer
desired, or has refused to examine the home.”

In other words, the statutory warranty does not cover patent (obvious) defects that the purchaser should have discovered before the closing.

Therefore, it is best to discover all patent defects before the closing. This will give the purchaser and his/her real estate attorney more leverage to negotiate an agreement with the seller regarding the repairs.

As always, the Law Firm of Vaughn, Weber & Prakope, PLLC is here to assist you.  Contact us at (516) 858-2620.

Please visit our Real Estate category to Learn more about real estate.

Facing Foreclosure

On April 17, 2010, in Bankruptcy, Foreclosure, by Robbie L. Vaughn, Esq.

Facing Foreclosure

I’m facing foreclosure, What can I do?

Some of your options:

1. Do something:

-Call your  lender and try to arrange a Loan Modification, Refinance, short sale, or Deed-in-Lieu of foreclosure.

-Loan Modification- A Loan Modification is a permanent/temporary change in one or more of the terms of your mortgage loan. Ideally, this will result in a payment you can afford. (You might able to do this yourself).
-See http://makinghomeaffordable.gov/eligibility.html

-Short Sale- A sale of a house for less money than is owed to the lender. Ideally, the lender agrees to accept the proceeds of a short sale and forgives the rest of what is owed. Some lenders are offering a cash incentive to homeowners if they are willing to short sale their home. You will likely need the help of a R.E. Broker & a Real Estate Attorney.

-Deed-in-lieu of Foreclosure- (May only be available after a failed Short Sale attempt). Ideally, the lender accepts ownership of the property in place of the money owed on the mortgage. You will likely need the help of a Real Estate Attorney.

-Consult with an attorney regarding:

-Foreclosure Defenses- Such as a Lack of standing, TILA violations, RESPA violations etc.

-Bankruptcy- Such as Chapter 13- which is a type of “reorganization” used by individuals to pay all or a portion of their debts over a period of years using their current income. The most important thing about a chapter 13 case is that it may allow you to keep your home if you can make the payments which the bankruptcy law requires to be made to your creditors.

-Deficiency Judgments- Generally, a judgment for the amount a homeowner owes the lender after a house is foreclosed upon and sold by the creditor for less than the actual amount still owed.

-Watch this New York State Bar Association video: http://204.8.127.102/peopleslaw/SaveYourHome.htm

2. Do nothing:

-Walk away (OR)

-Stay in your home until you get evicted.

-Pay or go calculator: http://www.payorgo.com/

We believe most people should consider contesting the foreclosure of their home.  We were recently successful in getting a foreclosure action stayed.  We hope to get it dismissed, or force the lender to do a loan modification.

Mineola Foreclosure Attorneys

Call The Law Firm of Vaughn, Weber & Prakope, PLLC, at 516-858-2620 to speak with a foreclosure defense attorney and/or a bankruptcy lawyer.

The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation. This website is Attorney Advertising. It does not form an attorney-client relationship. We are a debt relief agency and a law firm that helps people file for bankruptcy relief under the U.S. Bankruptcy Code – Title 11. Prior results do not guarantee a similar outcome. Proudly assisting residents of Long Island, Nassau county, Suffolk county, New York City, Queens, Brooklyn, Bronx, Staten Island, Manhattan