Question (CA): My partner and I recently purchased our first home, a 3 bedroom, 2 bath townhome. It is in a good area of the city we live in and is brand new construction. There is a private charter school (grades 9-12) being built across the street from us and will open in the Fall of 2008. The loan we took is a 5/1 ARM, and we signed papers in February of 2007. We took the loan for 100 percent of the purchase price. All the townhomes have been sold at this time.
Should we be worried about the market considering the type of loan we have? It is the only way we could get in, so we don't regret doing it. Should we refinance if rates are lower after 1 year? There are many different predictions on the market, and we would like to make money on our investment, but would settle for not losing money in the next several years.
Answer: Wow! Where do we start? To us a "5/1 ARM" means that the rate is fixed for a period of 5 years after which in the 6th year the loan becomes an adjustable rate mortgage (ARM). The adjustable rate is either tied to the 1-year treasury index or to the one-year London Interbank Offered Rate ("LIBOR"), and is added to a pre-determined margin (usually between 2.25-3.0%) to arrive at your new monthly rate. We would need to know what the margin, life cap and periodic caps of your ARM will be in the 6th year, before we could answer your question with any degree of certainty even if we knew what your stated rate was in February 2007, which we don't.
As for the real estate market in Laytonville or Mendocino County or in the Ukiah Metro Area, we suggest that you contact a knowledgeable, experienced Realtor and ask him or her your questions regarding the current market conditions and where he or she thinks the market will be in 4 to 5 years.
It appears to us, however, that your property seems to be well located relative to the private charter school's location and that apparently the townhomes were priced to the current market since they are completely sold out. In other words, you've got approximately 4.5 years to track the market conditions in your area, before the adjustable features of your loan kick-in.
Question (FL): I am a seller and met with two agents that worked for an agency. They seemed to be the best choice, after several agent interviews. I signed with their agency at the end of January 2007, which I thought was a 6 month agreement. I even lowered my price twice, under their advice.
About 1 1/2 months passed with no one showing my house. At that time I was told by one of the agents that they decided to move to another agency and that the other agency had no problems with them taking my file with them. Also, I had my house on FSBO and they told me that I had to refer all interested parties to them. I gave them 4 leads from my ad and they got a listing out of one and they ignored the rest. One of the leads was very interested in my house and again I referred it to my agent. She refused to help me and told me to take care of it and if she showed up to inform her about it. In other words, you do the work and she will end up with a commission.
After going back and forth with my agent and the person interested, the interested party bought another property. I finally dropped my FSBO and told them they need to do their job.
Here are my questions:
- Can an agent leave an agency that I have a listing contract with and take my file to another agency without having me sign another contract or giving me the opportunity to cancel?
- I have sent them many e-mails asking questions, such as why is my contract 7 months, why have I only received copies of 3 ads in the free-be real estate booklet? No Response.
- I called and left messages with them and neither agent returned my calls. Finally one agent called and accused me of selling my house and told me the agreement was for 7 months because my price was too high. I asked him for proof of these accusations and he told me it was confidential. I said to him that he works for me and needs to be honest. As far as the accusations go, they are NOT true. He even said that after the 7th month it goes month by month.
He was very rude and had me in tears. I told him that my apartment became available and he said he already knew that. I asked, "Who told you?" He wouldn't say and I never told anyone except family. I went to my house to check on it and found lights on and my master bedroom closet light was on too, that indicated someone had been in the house. The only ones that had a key to my house were me and the Realtor. There was no lock box. I have been asking for my key and have received no response.
By the way, this is the 7th month and they never showed the house to anyone. I think they set me up under my FSBO. Just before I shut down my ad, a woman kept e-mailing me about my house and calling me and asking too many questions. She sent me an e-mail 4 weeks later to the date and time that my agent called. I thought that was strange, so I told the agent about her and he told me not to contact her and that he would take care of it. So, I waited and heard nothing from the agent and decided to reply to her and she was so thrilled and wanted to know if I was happy in my apartment. Now, how did she know?
Is there anything I can do?
Answer: Thanks for your timely answers to our questions in an attempt to clarify the events that transpired. We are sorry that you are having these difficulties, especially with real estate agents who are supposed to meet the needs of consumers.
First, we recommend that you hire a Florida lawyer. For folks who cannot afford an attorney, there are two legal aid services in your county (Citrus County) but one is for prisoners and other people in state custody. So we recommend that you contact Community Legal Services of Mid-Florida, Inc. -- Inverness Office, 1300 Highway 41 North, Suite A, Inverness, FL 34450 (352-726-8512), www.clsmf.org.
To begin with, it appears that these two agents have not acted in your best interests, have failed to discharge their fiduciary duties to you which are clearly established in your original Listing Agreement when the agents and you agreed that you would be represented as a Single Agent of Seller (you). And, "No," a real estate agent cannot simply change brokerage firms and take a listing with them. It requires written approval from their Sponsoring Broker, the Broker who was responsible for the brokerage business with which you signed the Listing.
In addition, based upon your responses to my email inquiries, these agents did not provide a complete copy of your Listing Agreement, and placed the wrong date on the transfer to the other Agency, to name just a few of the apparently numerous failures to represent your best interests as a seller.
Question (MI): My boyfriend and I have been together for over 5 years and are planning on buying a home together prior to marriage. Several people have advised me to wait until we are married before we buy a home together, however this is not feasible. What do you feel is the best way to go about buying a home together if two people are not married? Thank you for your input.
Answer: There are only two ways that an unmarried couple may hold title to real estate in Michigan:
- The first is called "Tenancy In Common." Each owner has a right to separately convey and transfer his/her title to the real estate. If one of the owners dies, his or her title passes to his or her heirs; or,
- The second form is called "Joint Tenancy." In this form of joint ownership of real estate, each owner has one and the same interest in the real estate. The owners hold the right of survivorship, which means that if one of the owners dies, his/her interest automatically passes to the other owners.
You asked for our opinion as to the "best" way for two unmarried people to co-own real estate, so here it goes:
- One of the co-authors thinks that because conditions, people, and circumstances can change, the best way for two unmarried people to co-own real estate is Tenancy In Common. Each owner has a right to separately convey his or her title to the property and thus neither person can be held captive to the ownership position they have; and,
- The other co-author believes that probably Joint Tenancy is the best form of co-ownership because the surviving owner can at least get the other's interest in the event of death.
So, for an answer to your question based upon facts you and your boyfriend communicate to a licensed professional, we recommend that you and your boyfriend hire an attorney who can explain the advantages and disadvantages connected with each of the two forms of ownership. Then you and your boyfriend must choose the form of ownership that makes the most sense to you both. This should be approached with both you and your boyfriend having equal voices regarding the two types.
Question (TN): We have a question about member rights of a HOA. We bought a beautiful water view property in a lakefront community and paid double for it compared to a lot without the view.
We were told at the time that nothing could be done to block the view, screen or fence, etc. The HOA bylaws do state that the size and locations of buildings, not the home, could be controlled by the HOA. Our new neighbor planted Leland cypress along the property line and in several years will totally block our view. We made a complaint to the HOA prior to the approval of the landscaping plans, but the plans were approved with no discussion with us.
We had been told by the HOA that the plans belong to the homeowner and we have no rights to view the plans or the approval date of the plans. We feel our complaint went unnoticed by the HOA and our property value will be decreased. Is there anything we can do about this situation, or just move before the trees grow?
Answer: Just because a sales representative "told" you that your view could not be obstructed, does not relieve you from the responsibility of reading the HOA By Laws and other pertinent documents to verify that the sales rep's statement is accurate. You have the added difficulty of proving that the sales rep made the statement, assuming the HOA does not address "blocked views" in writing.
However, you should consult a Tennessee Attorney with successful experience in Deceptive Trade Practice litigation to look at the merits (and weaknesses) of your case. If you purchased and paid more for the property specifically in order to obtain the unobstructed view, then the sales rep who told you your view could not be obstructed was wrong and that may be a violation of the DTPA. Again, however, proving the sales rep made the statement could be very difficult.
Then there is the emotional stress and other negative consequences of bringing a lawsuit against your own HOA. It would be simpler to just sell before the trees grow to the height at which they will block your view.
The lesson here is that if an unobstructed view of the lake is that important to you, buy an actual lake-front property in which no other property owner can obstruct your view.
