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Hillard N. Einbinder, Attorney at Law
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Q: How does a dual closing work? And is it legal in connecticut?
Answer
What is your question?Q: I won a judgment more than 23 years ago can I still collect this?
Answer
What is your question?Q: What appliances are included with house sale in Connecticut (refrigerator, washer, dryer, range, etc)? Answer
What is your question?Q: What has happened to the "American Dream" of home ownership? Has it really become an "Impossible Dream?" Answer
What is your question?Q: Last week I signed a 3 month listing agreement with a realtor agent in my neighborhood. I've changed my mind and am thinking I should advertise and sell the house on my own. How can I cancel the agreement? Answer
What is your question?Q: What is a mortgage? Answer
What is your question?Q: What are closing costs? Answer
What is your question?Q: How do I know how much I can afford to buy a house? Answer
What is your question?Q: What are the common steps to take in writing an offer once I have found the house I want to buy? Answer
What is your question?Q: When listing my house should I leave room for bargaining? Answer
What is your question?Q: I'm shopping for a new home. Can I get a better price by contacting the realtor advertising a particular listing? Answer
What is your question?Q: What is a lien? Answer
What is your question?
Q: How does a dual closing work? And is it legal in connecticut?
A: A "dual closings" or "double closings" are two closings, arranged to occur simultaneously, where an investor, using a buyer’s money, purchases property from a seller and immediately sells to the buyer for a profit. By way of example, assume the following: Investor enters into a contract with Seller to purchase his residence for $100,000. Investor then enters into a contract to sell the same residence to Buyer for $125,000. Investor arranges for a “dual closing”. At the closing, the settlement agent pays $100,000 to the Seller, and $25,000 to Investor. Is this legal in Connecticut? Yes, PROVIDED THERE IS A FULL DISCLOSURE OF THE ENTIRE TRANSACTION TO BUYER, SELLER, AND TO THEIR RESPECTIVE FINANCIAL LENDERS, if any. However, in the typical dual closing, such disclosures are not performed. Rather, financial details are intentionally withheld from certain parties to avoid renegotiation and/or the raising of objections. Today, the real estate closing industry is highly regulated. Compliance with regulations, which requires full disclosure, provides the only safe harbor.Return To Questions What is your question?
Q: I won a judgment more than 20 years ago, can I still collect this?
A: In Connecticut, the time limitation to collect a judgment is dependent upon 2 factors: first, in what type of court was judgment entered, and second, the age of the judgment. If your judgment was entered in a small claims court, you have 10 years from the date that judgment was entered to apply to the court for an execution to collect the judgment. If the judgment was entered in superior court, you have 20 years from the date that judgment entered to request an execution from that court. Even if your judgment is secured by a lien, generally, it will expire unless a foreclosure action is timely commenced within the applicable limitation period stated above. Note: in Connecticut, there is no time limitation of the enforcement of a judgment for personal injury caused by certain sexual assaults where the party legally at fault was also convicted of the crime.
Return To Questions What is your question?
Q: What appliances are included with house sale in Connecticut (refrigerator, washer, dryer, range, etc)?
A: If the house is listed in a multiple listing service disclosure, the appliances included in the sale are listed. Generally, all kitchen appliances, and the washer & dryer, will be included. What stays and what goes is always subject to negotiation. For example, if the Sellers recently purchased a new washer & dryer, it would not be surprising for them to exclude them from the sale.
Return To Questions What is your question?
Q: What has happened to the "American Dream" of home ownership? Has it really become an "Impossible Dream?"
A: Home Ownership has not become "The Impossible Dream." Yearning and working hard to own our own homes still lives deep in the heart of the American Dream. The American Dream is alive and well.
Are you thinking that I must have my head in the sand and don't see the news about the housing crisis on TV and or the newspapers? Nowadays the anxiety about this seems to be everywhere. Reading newspapers isn't bad, but you should read more than just newspapers. How about reading history books, economic history books in particular.
All aspects of economics run in cycles; things go up and then go down and then up again. Even pendulums, as in grandfather clocks, swing all the way to the left side and then all the way back to the right. The entire universe operates in cycles; the earth revolves around the Sun completely once every 365 days. This has been happening since our solar system was created.
As humans we look at outside events and forget that there is a constant factor in the Universe, the constant factor is this: Things Change!
Rational people realize that cycles are real and understand that history repeats itself. When they just look, without the fear and anxiety promoted by the media, they can read the handwriting on the wall.
Wisdom understands that the handwriting says "The Sky is Not Falling," and also that this era in our national history may well be one of the best times to buy a home in a great many years.
When is it the best time to buy a house, when prices are at all time highs or when there is a housing market correction, a slump, and bargains are abundant? It was "Chicken LIttle" who declared that the sky was falling. He was wrong. I don't know what became of him, but he may be turning up, extra crispy, in a bucket of KFC with a side of mashed potatoes and gravy.
Return To Questions What is your question?
Q: What are closing costs?
A: Real property in most jurisdictions is conveyed from the seller to the buyer through a real estate contract. The point in time at which the contract is actually executed and the title to the property is conveyed to the buyer is known as the "closing". It is common for a variety of costs associated with the transaction (above and beyond the price of the property itself) to be incurred by either the buyer or the seller. These costs are typically paid at the closing, and are known as closing costs.
Return To Questions What is your question?
Q: Last week I signed a 3 month listing agreement .................
A: Realtors need active cooperation from their clients or they cannot succeed in selling. Just tell the realtor that you want to cancel and he/she will probably let you off the hook. He has the right to try to activate the listing if you sell it with another realtor within the contract period.
Return To Questions What is your question?
Q: What is a mortgage......................
A mortgage is a contract that pledges real or personal property as security for the performance of an obligation, typically the payment of a debt. The term comes from the Old French "dead pledge," apparently meaning that the pledge ends (dies) either when the obligation is fulfilled or the property is taken through foreclosure.
Mortgages are strongly associated with loans secured on real estate rather than other property and in some cases only land may be mortgaged. Arranging a mortgage is seen as the standard method by which individuals and businesses can purchase residential and/or commercial real estate without the need to pay the full value immediately.
In countries where the demand for home ownership is highest, strong domestic markets have developed, notably in Spain, the United Kingdom, and the United States. In these countries it is common for home purchases to be funded by a mortgage.
Return To Questions What is your question?
Q: How do I know how much I can afford to buy a house?
A: Intelligent first-time home buyers are buyers who think ahead. It's really smart to consider affordability before signing that purchase contract and plunging into debt.
Lots of home buyers in the USA tend to over estimate how much home they can afford. For example, a $225,000 home in California might be a starter home, but it still costs a quarter of a million dollars! Look at your monthly gross income, before taxes and contributions. This is how much you make per month, not how much you take home. What you take home is net income.
Lenders typically use what is called a "front-end ratio", which is a percentage of your gross monthly income. The front-end ratio signifies the payment a buyer can reasonably afford, from a lender's point of view. You may prefer a lower payment.
Presently, the front-end ratio for a FHA loan, by example, is 29%. For a conforming conventional loan, the front-end ratio is 33%. This means if your monthly gross income is $4,000, to qualify for a FHA loan, your monthly principal, interest, taxes and insurance (PITI) payment would be $1,160.00. For a conventional loan, it is $1,320.
Lenders also tend to use a "back-end ratio" that reflects your new mortgage payment, plus all recurring debt. It, too, is computed on your gross monthly income. The back-end is higher than the front-end. Presently, for an FHA loan, the back-end ratio is 41%. For a conforming conventional loan, it is 45%.
This means if your car payment is $300, and you pay $100 a month between two credit cards, your total monthly recurring debt is $400. On the FHA loan payment above of $1,160.00, plus $400 recurring debt, your total is $1,560. The back-end ratio number is $1,640 ($4,000 x 41% = $1,640.00} Your total debt is less than $1,640.00 so you qualify.
Return To Questions What is your question?
Q: What are the common steps to take in writing an offer once I have found the house I want to buy?
A: You or your Realtor can write the contract (offer proposal). The exception here is Fairfield County, in Connecticut. Here are the typical steps that will apply:
a. Buyer signs and submits the contract along with a deposit, binder (earnest money) of about $500 to $1000.
b. The seller accepts the offer and the binder and signs the contract. The Realtor will then deposit the money in an "escrow" account until closing.
c. The buyer can elect to have contingencies regarding termite and building inspections written into the contract. The inspections are paid for by the buyer and completed within a specific and agreed upon number of days prior to the signing of the contract.
d. Additional monies must be added to the original deposit within 10 days of the contract acceptance, and the total deposit must equal 10% of the purchase price or an amount mutually agreed upon by the buyer and seller.
e. At this point it is time the buyer will submit his mortgage application to a lending institution or a mortgage broker.
f. At about the same time the lender will order a credit report on the buyer and an appraisal of the property.
g. If all is going as it should the lender will then approve the buyer's credit and the property will be accepted as collateral for the loan.
h. Now the lender can and will approve the mortgage loan application because he has verified the buyer's employment, his funds, and and the appraisal. He then forwards all documentation to the lenders designated attorney.
i. With the acceptance of the mortgage the title search will be ordered by the buyer's attorney.
j. The closing will then be held at the office of the attorney or lender.
k. From here on the buyer, the seller, the attorneys and the lender are free to live happily ever after. Amen.
Q: When listing my house should I leave room for bargaining?
A: Leaving room for bargaining is a smart idea for several reasons:a. Many buyers expect that sellers have built some bargaining room into the listing price.
b. Some buyers need to feel that they got a "great price"; it's a matter of ego.
c. Many buyers grew up in families that have a tradition of price bargaining when shopping for automobiles and homes or other "big ticket" items.
Q: I'm shopping for a new home. Can I get a better price by contacting the realtor that advertising a particular listing that has my interest?
A: This is not a very good idea. The advertisement is sponsored, paid for, by the company representing the seller; their goal is to sell the property for the maximum that a buyer is willing to pay. They will not be representing you or your best interests. It is always best to be represented by your own realtor. Showing the listing to your realtor is not a bad idea.Return To Questions What is your question?
Q: What is a lien?
A: A lien is a form of security, a legal claim on "real property" (something tangible of real value). It is used to insure the payment of a financial or other obligation. If the debt is not repaid as promised the lien holder (lien owner) can foreclose on the property by means of a public sale to force the payment of the debt. A mortgage is a lien; it is a claim against the property. It is security for the grantor (lender) of the mortgage.Not all liens are mortgages. One such other type of lien is a "Mechanic's Lien". It is part of the work of the real estate attorney is to check for outstanding liens at the time of the closing. This is a very important task because the lien represents unpaid bills of the seller that will become the debts of the new owner if they are not paid or credited prior to or during the closing. There are other types of liens as well. A buyer surely does not want to be "blind sided" by any undiscovered liens after the closing has been completed. It pays to work with top legal representation at all real estate closings.
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DISCLAIMER: This entire website and all information contained herein are intended for informational purposes only and should not be construed as legal advice. You should always seek competent and licensed legal counsel in your home area for advice on any legal matter. The laws, rules and regulations can vary from jurisdiction to jurisdiction.
Copyright © 2007 - 2008 Hillard N. Einbinder, Esq.
