real estate closing attorney danbury ct

Do I Need a Real Estate Closing Attorney to Sell My Home?

Selling a Home in CT? You Need a Real Estate Closing Attorney

If you are looking to sell your home, you may or may not want to hire a real estate agent, but you will definitely want to hire a real estate closing attorney. While the marketing of your home to potential buyers is something you might be able to handle yourself, the services of a seller’s real estate closing attorney are essential to a legally compliant real estate sale.

What does a seller’s real estate closing attorney do?

A seller’s real estate closing attorney provides many services to the Seller that legally legitimize the sale and make it binding, while at the same time protecting the liability and financial interests of their client. A seller’s real estate closing attorney performs the following closing tasks:

  • Reviews Exclusive Right to Sell Agreement and Dual Representation Waiver with real estate agent/broker (if hired early enough);
  • Reviews and assists with Listing and Mandatory Disclosures (once again, if hired early enough);
  • Negotiates with buyer’s attorney and drafts Purchase and Sale Contract;
  • Works to resolve any inspection, appraisal or title issues to meet buyer’s needs;
  • Prepares closing documents such as power of attorney, Deed and affidavits;
  • Obtains payoff statements for outstanding liens or mortgages;
  • Attends the closing with, or on behalf of, the client;
  • Handles cash flow in escrow, receiving purchase funds and making any payments or disbursements; and
  • Secures and records releases for mortgages after closing.

When issues arise in real estate deals it is the attorneys that defuse situations and save deals by coming up with solutions that are acceptable to both parties. A seller’s real estate closing attorney can save a seller of real estate property a lot of stress and worry.


 

If you are looking to sell a house or condo in Connecticut, let us handle your real estate closing matters. We charge flat rate fees on closings, and we offer FREE phone consultations, so you can make sure we are the right attorney for you.

SCHEDULE A CALL WITH OUR REAL ESTATE ATTORNEY

buyers real estate closing attorney

Why Do I Need a Real Estate Closing Attorney to Buy a House in Connecticut?

Buying a House in CT? You will need to hire a Real Estate Closing Attorney

If you are looking to buy a home in Connecticut, you will need the services of a real estate closing attorney. A buyer’s closing attorney’s job is to protect their client legally and financially. This includes handling all of the contracts, clearing title and securing title insurance, and meeting all lender requirements.

What does a buyer’s real estate closing attorney do?

A buyer’s real estate  closing attorney helps coordinate the purchase of the property by making sure all laws are followed, his client is getting the property as promised, and by managing the finances. A buyer’s closing attorney performs the following functions:

  • Review the Exclusive Right to Buy or Sell Agreement and Dual Representation Waiver between the buyer and their real estate agent (if hired early enough);
  • Review preliminary title report Seller ownership issues;
  • Review and negotiate Purchase and Sale Contract with seller’s closing attorney;
  • Review mortgage commitment issued by the mortgage company and any conditions;
  • Order and review the title search to find any liens, mortgages, judgments or other issues;
  • Prepare buyer’s closing documents such as power of attorney;
  • Review seller’s closing documents including Deed;
  • Review loan documents and meet all lender requirements;
  • Attend closing with, or on behalf of, the client;
  • Act as Settlement Agent for the Lender;
  • Handle all funds through escrow and make all necessary payments and disbursements;
  • Provide an accounting of funds to the client; and
  • Record all documents at Town Hall such as Deed, Mortgage and any Power of Attorney.

A buyer’s real estate closing attorney can minimize the stress and anxiety of buying a home by giving you somebody you can turn to with literally any question throughout the process. This is perhaps the biggest benefit.


 

If you are looking to buy a house or condo in Connecticut, let us handle your real estate closing matters. We charge flat rate fees on closings, and we offer FREE phone consultations, so you can make sure we are the right attorney for you.

SCHEDULE A CALL WITH OUR REAL ESTATE ATTORNEY

delays in real estate closings

Hazard Insurance Delays Real Estate Closings Under New TRID Laws

Hazard Insurance may Delay Your Real Estate Closing

Under the new TILA/RESPA Integrated Disclosures (“TRID”) real estate settlement practices, consumers (those taking out a mortgage to buy a home) must receive and acknowledge the Closing Disclosure, a document showing where all the money is going, a minimum of 3 business days before the actual closing can occur. This means that if any dollar amount changes on the Closing Disclosure, and it has to be acknowledged again, the closing will be delayed for at least another 3 days.

How is Hazard Insurance delaying closing?

One of the biggest issue is old custom. Prior to TRID, it was common for hazard insurance quotes to be obtained a day before closing or even the night before closing. This is because previously there was some leeway regarding dollar amounts and time tables, but not anymore.

So, if the the realtor or real estate attorney do not remind the client to get hazard insurance lined up, the closing could be delayed until a quote is received, updated on the Closing Disclosure, received and acknowledged by the client and a new closing date can be arranged between all parties.

Conversely, I have also seen a closing delayed because the hazard insurance quote was obtained TOO EARLY. Due to changes in the purchase price, the appraised value, or issues discovered during inspection or the walk through, the cost of hazard insurance could change. If the insurance salesman or broker does not take the proper steps to keep everybody informed of any such changes delays may occur.


With the change in laws and the addition of stricter requirements and guidelines, it is more important than ever to hire an experienced real estate attorney to handle your closing. Do problems happen? Sure they do. But you want somebody with the experience and the know-how to limit problems, to spot them when they occur, and to resolve them in a quick and painless manner.

If you are looking to buy a house or condo in Connecticut, let us handle your real estate closing matters. We charge flat rate fees on closings, and we offer FREE phone consultations, so you can make sure we are the right attorney for you.

SCHEDULE A CALL WITH OUR REAL ESTATE ATTORNEY

 

foreclosure defense attorney

Right to Foreclosure Mediation Extended to Divorcees and Surviving Spouses – Connecticut Public Act No. 15-124

Right to Foreclosure Mediation for Divorcees and Surviving Spouses

Connecticut Public Act 15-124 – An Act Extending The Foreclosure Mediation Program

One of the benefits of being in a multi-partner law firm is the overlap between our different practice areas, allowing us to better help our clients in difficult situations. Since our firm represents divorce clients, probate clients, and foreclosure clients, Connecticut Public Act no. 15-124 is going to allow us to help clients better solve their foreclosure issues when relating to residential real estate property that was part of divorce or probate proceedings.

The Problem Was Standing

Perhaps you are a divorcee. You just finished the long and stressful process of divorce. Part of the Court ordered Divorce Decree is that your ex-spouse execute a quitclaim deed transferring a house or condominium to your ownership. The deed is drafted and recorded on the land records and as far as you are concerned the property is now yours.

Perhaps your spouse recently passed away. You just finished the extremely complicated probate process. In their will your spouse left you residential real estate property. The Executor of your spouse’s estate drafted an Executor’s Deed, which was approved by the probate court and recorded on the land records, transferring title in the property to you.

In either case, let’s assume there was a mortgage on the property. Either your ex-spouse had not been making payments or the probate estate had not been making payments and the mortgage is in default. Or, even if the payments are current, the mortgage has a “due on transfer” clause, which states that if the property is ever transferred from the ownership of the borrower under the mortgage, the entire outstanding amount is due and payable in full. As is common, the collateral on the mortgage is the property itselfThe bank is now foreclosing on the property.

As the new owner, you want to enter foreclosure mediation so that you can find a way to keep your family home; through mortgage modification or refinance. Until October 1, 2015, YOU COULDN’T!

The issue was standing! Since you were not a party to the mortgage, you had no “privity of contract”, and therefore no standing to challenge the foreclosure in court. The foreclosure would proceed and the bank would be allowed to either repossess or sell your property to pay off the money owed to them.

The Connecticut Legislature Solves The Problem

The Connecticut Legislature saw the issue of removing spouses from the family home without letting them be heard when a court order had given them possession of the residential real estate property. After all, how is it fair to completely stonewall the new owner of the property from mediating a solution to the foreclosure?

Therefore, Public Act No. 15-142 has extended the foreclosure mediation process to include spouses who became “successors in interest” due to divorce, separation, or death of the other spouse.

What this means for our clients

The new law allows the divorcee or decedent’s spouse to stand in the shoes of the previous owner, at least as far as defending against foreclosure of the property is concerned. This means that we can now offer assistance to our foreclosure clients who became owners through divorce or death of their spouse. Previously, we would have had to turn these people away as there was no legal procedure available for us to resolve their problem. It is not guaranteed that the successor-in-interest spouse will be allowed to keep the property, but at least now they have a fighting chance.

Short Sale Debt Forgiveness Tax Relief

Tax Relief for Short Sale Debt Forgiveness

Short Sale Tax Relief

Exemption for Tax Liability Created by Short Sale Debt Forgiveness

The Budget Bill signed into law by President Obama on December 18th, 2015, has received a lot of coverage in the news for many reasons. One of the good thing hidden in the Bill is that The Mortgage Forgiveness Debt Relief Act, which had expired in 2014, has been retroactively extended through 2016. Let’s take a look at why further relief is necessary when debt is forgiven through short sale.

Debt Forgiveness is a Taxable Event

In this world, very few people are strangers to debt. Whether it is unsecured debt such as credit cards or student loans, or secured debt such as a mortgage on real estate property or car loan, almost everybody owes somebody else money. However, lenders do not always successfully collect debts owed to them. In these cases, the lender may elect to cancel all or part of the debt of the borrower.

With unsecured debt, the lender might not be able to collect the debt or may simply give up on trying to collect. With secured debt, the lender will usually chose to foreclose or repossess the property, or allow a short sale as discussed below.

What many people do not know, is that the forgiveness, discharge or cancellation of debt (whichever term you chose to use), is generally a taxable event. The IRS expects people to pay taxes on the difference between the amount they owed and the amount they actually paid. How does the IRS know? Because the lender is required by Federal Law to file Form 1099-C “Cancellation of Debt”, for any debt forgiveness greater than $600. the 1099-C contains pertinent information such as the borrower and lender identification, amount of debt forgiven and date of discharge. you are then required to show the amount of forgiven debt as income on Form 982 and submitted with your Form 1040 “Income Tax Return”.

How Does Debt Forgiveness Tax Impact Short Sale?

In a Short Sale, the lender allows the property owner and borrower to sell the property for less than they owe, and forgive the remainder of the debt, in an attempt to save themselves the time and cost of foreclosure and property maintenance. Technically, this debt forgiveness would be a taxable event as discussed above.

However, The Mortgage Forgiveness Debt Relief Act shields homeowners from tax liabilities created by mortgage debt that is forgiven due to Short Sale of a principal residence (as well as debt forgiven through mortgage modification or deed in lieu of foreclosure). Up to $2,000,000 of forgiven debt is eligible for tax exclusion.

Is Tax Relief for Short Sale Debt Forgiveness Fair?

Whether the forgiveness is fair or not is up for debate, but it definitely makes sense. People seeking Short Sale to avoid foreclosure do not have the money to pay their mortgage. How can the IRS expect the borrower to pay taxes on money they couldn’t pay? With the great number of financially distressed properties in this housing bubble, they can’t.

Consult a Professional

You need to make sure you are making use of the right professionals so that you do not pay the price at a later date. Your account should be consulted whenever a large scale taxable event occurs; such as the forgiveness of thousands of dollars or more in debt. They will need this information to accurately file your tax return. Your real estate attorney needs to make sure that the lender provides you with a 1099-C that is complete and accurate. Finally, you need to make sure that your team is communicating and exchanging information efficiently.

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