What if you buy a condominium, relying on the disclosure information the condominium association board or management company provided you, only to find out that they didn’t give you everything they should have? What if you would never have bought the condominium if the association had disclosed all of the information they were supposed to? Well, you’re out of luck. In a recent case, D’Attomo v. Baumbeck, 2015 IL App (2d) 140865, this very issue was decided by the Illinois Appellate Court in favor of the condominium association. In that case, the contract purchaser of the unit sued the condominium association board, stating that they had breached their fiduciary duty by not providing the buyer with a copy of the amendment to the condominium declaration which prohibited leasing. The court held that the condominium association has no fiduciary duty to a contract buyer. Their duty is only to existing owners… read more →
Although it may not seem like it, banks abandon foreclosures all the time. And to help guide them through this process, the Federal Deposit Insurance Corporation (the FDIC) issued guidelines last week to clarify its expectations for lenders canceling a foreclosure. The FDIC encouraged lenders to work with borrowers to come up with an alternative that would allow borrowers to stay in their homes, which would make it more likely that homes would remain well-maintained and care form. The FDIC stated that when abandoning a foreclosure, banks should: Comply with state and local laws. Notify state and local governments and other relevant authorities of their decision to abandon the foreclosure. Notify the borrower that they are abandoning the foreclosure. Notify the borrower that they have the right to remain in the property for the time being, until the property is sold or transferred in some other way. Notify the borrower… read more →
RealtyTrac determined that 11.5% of homes nationwide were “seriously underwater” on their mortgages; in other words, they own at least a quarter more than their home is actually worth. RealtyTrac tracked one hundred U.S. cities, and only five of them had a higher percentage of homes underwater than the nationwide average. Chicago, unfortunately, is one of those cities. 21.5% of mortgaged Chicago-area homes are seriously underwater. As of December of 2015, that amounted to approximately 516,000 homeowners. Incidentally, that’s an improvement from December of 2014, when about 521,000 Chicago-area were underwater. The highest percentage of underwater homes were in Las Vegas, where 27.7% of homeowners with mortgages owe at least a quarter more than the value of their homes. Despite all of this, according to Black Knight Financial Services, while 1.09 million homes nationwide were at least 90-days past due on their mortgage payments (though not yet in foreclosure) at… read more →
If you are selling your home and looking at offers, you have so many things to think about. Are you getting the price you want? Can you be moved out in time for closing? What kind of repairs will you have to make? Will the buyer be looking for a credit? How much are your closing costs? Is the buyer going to get a loan? Is the buyer putting down enough money? Is the buyer getting an FHA loan? What does that mean for me? And at the end of the day, is this going to close? That’s what it all comes down to: Is it going to close? As a Seller, are you going with the right offer – the one that’s most likely to close and still give you the price you want? You already know you need to make sure the buyer either has the cash or… read more →
If you have your heart set on buying a home, but you can’t afford to put down a large downpayment and don’t have the greatest credit, an FHA loan might be the right option for you. FHA loans only requires a minimum downpayment of 3.5% of the purchase price. This makes them an affordable option for a lot more people. FHA loans also allow a higher debt to income ratio than conventional financing. You can spend up to 57% of your income on debt. Conventional loans typically cap that around 45% or less. What’s the downside? Well, you have pay an upfront mortgage insurance premium. That’s a pretty hefty amount, usually 1.75% of your purchase price. On top of that, you’re still paying PMI (private mortgage insurance) on a monthly basis. FHA PMI is typically higher than regular PMI. Despite all that, if conventional financing is not an option, then… read more →
According to JLL, the total sales value of apartment building sales in 2015 was almost $139 billion. This was a 31% increase over 2014, when apartment building sales were at $106 billion. The last quarter of 2015 boasts the strongest gains of any quarter ever analyzed and recorded. Moreover, JLL predicts there will be even more growth in apartment building sales in 2016, though at a more moderate rate between 5% and 10%. As rents are going up and interest rates on commercial loans remain reasonable, the increase in apartment building sales does seem likely. Personally, I did see a large increase in apartment building sales in 2015, particularly in Chicago – everything from 2-flats and up were flying off the shelves, so to speak! It also seemed to be a bit easier to get financing for apartment buildings last year than it has been in the past (although that… read more →
The National Association of Realtors recently put out figures that show that the housing market is thriving: Approximately 5.26 million homes were sold in 2015. The median sales price nationwide was $224,100. That’s a 7.6% increase over the median sales price in 2014. In 2015, home values increased over twice the rate of the increase in income. There were nearly 4% less homes listed in 2015 than in 2014. Overall homeownership rates are just below 64%.
The National Association of Realtors surveyed 2,643 agents internally in December of 2015; among other things, they looked into why so many closings get delayed. Here’s what they found: 46% of delays were caused by financing-related troubles. 21% of delays were caused by appraisal issues. 14% of delays were caused because of the home inspection. 19% of delays were caused for other miscellaneous reasons. If you’re the seller, there really isn’t much you can do to push the transaction through, except keep your home in good repair and respond to your real estate attorney quickly to avoid unnecessary delays. As a buyer, though, you should really keep tabs on your lender and make sure they are doing everything in their power to keep your file moving in a timely manner
Let’s say you’re in the unfortunate situation where a contractor has filed a mechanics lien against you. Without getting into the merits of whether or not the contractor has a valid claim, for whatever reason, you decide you don’t want to pay him. So you start looking for problems with the claim. You look and look and look, and aha! You found a problem. Looks like the contractor put the wrong completion date in the complaint he filed with the court. With this error in hand, you seek to get the case thrown out, right? Wrong. In North Shore Community Bank & Trust Co. v Sheffiled Welling, LLC, 2014 IL App (1st) 123784, the property-owner sought to have the contractor’s claim dismissed based on the contractor stating the incorrect date of completion in the complaint. The court ruled that as long as the actual completion date was within the time… read more →
While interest rates went over 4% on a 30-year fixed loan at the end of last year, they have dropped back down to below 4%. The 30-year fixed interest rate is about 3.97% right now. A year ago this week, it was 3.79%. The 30-year fixed interest rate for FHA loans is 3.9%, and the 30-year fixed rate for jumbo loans (where the loan amount is over $417,000) is 4.02% right now. It’s still a good time to buy. In fact, according to the Mortgage Bankers Association, with the drop in mortgage rates this week, mortgage applications increased about 21%. Nearly 56% percent of the applications are for refinancing, however. Only 44% are for new purchases.