Tom Sammons: Real Estate

Wed, 20 Aug 2003 12:30:52 GMT

What to Do if Your Mortgage Lender Bails Out on You

Recently, as interest reates rose and the number of files on their desks exploded to record levels, mortgage companies have bailed out on clients and failed to close. In two cases I am involved in (both of which are new construction) the mortgage companies literally "forgot" about the client. The loans were not ready to close because no one paid attention to the file for months. The other problem is that many lenders are so busy that they can't close by the end of the "lock-in" period. The client is left with a lame promise that the mortgage company will do a "free refinance" later to cure the problem.

How can you prevent this? Pick a reputable lender in the first instance; not one from the internet or your brother-in-law who thought he would try out mortgage brokerage. Stay in touch with the lender. If all else fails, file a complaint with the office of banks and real estate. Here is the form to file the complaint:

http://www.bre.state.il.us/CONSUMER/FORMS/c-Form41.pdf

It rarely pays to file a lawsuit against the lender. Attorneys fees are cost prohibitive and your damages are hard to prove.

Fri, 01 Aug 2003 12:44:54 GMT

Security Deposit Hassles

I just finished a rather bitter case involving a security deposit. The rules on security deposits are as follows:

1. If the property is in a complex of 5 or more units (this does not mean that the landlord has to own all 5 units, but that the complex has 5 or more units); then,

2. The landlord has 30 days to give the tenant an itemized list of damages;and,

3. The landlord must return the security deposit within 45 days of the tenant moving out.

If the landlord does not do #2 and #3 above, the tenant can file a court case for two times the amount of the deposit plus costs and attorneys fees.

If the property is a single-family house or in a complex of 5 or fewer units the above rules do not apply; you will have to look in your lease for the rules on returning your deposit.

The City of Chicago (click here for a pamphlet on the Chicago rules or here for a good summary of the Chicago ordinance)and some other suburbs including Evanston have their own very specific rules on this topic.

Thu, 24 Jul 2003 12:54:45 GMT

Mold is in the Air

Mold cases are increasing. More and more, home inspectors find mold in attics during the inspection.

In the last month, I have had two mold cases: In the first case, the Buyer backed out of the contract. A few days later the Buyer reconsidered and signed a new contract, for $5,000 less than the last one, but accepting the property "as is." In the second case, a mold remediator was called in, the seller cleaned up the mold for about $2500 and the Buyer closed.

If the inspector finds mold, a mold remediation company is called in to examine it, clean it up and stop the leakage that caused it in the first place. Generally, home inspectors will not do mold remediation; they just indentify a mold problem.

If you are thinking of selling a home it may be wise to inspect your attic for mold before it goes on the market.

Click here for a good summary of how to prevent mold and what to do if you find it.

Sat, 12 Jul 2003 19:53:41 GMT

Will Your Homeowner's Insurance Hold Up if Your Property is Vacant?

In handling estates and trusts, frequently the deceased's home is empty and must be sold. Another circumstance that pops up is a client moves out of his house to rehab the house. If your house, or a house you inherited, is left vacant, you must be careful and do the unthinkable, that is, read your homeowner's insurance policy.

Most times you will find that the insurance still covers you, but thefts and vandalism are not covered if the house is vacant more than 30 days.

If you are rehabbing your house, and move out, many policies still cover you for everything including theft and vandalism.

Some insurance agents state in a blanket fashion that there is no coverage on an empty home and then try to sell you a policy for $4000 or more per year in premium.

Do yourself a favor and check the terms of your insurance policy. It will give you peace of mind and save some cash.

(Credit to Terry Griffin Esq. for the above)