Don’t wait any longer, sue buyer
Author: Skia
Category: Real Estate
Q:I sold my house six years ago and carried back a $7,000 second mortgage at 5 percent interest for the buyer. She has made only random payments of different amounts, for about $5,000 total, including interest. There was supposed to be a balloon payment at the end of two years. She still owes me about $5,000. My problem is the agent who handled this said he would handle any problems. He has all the paperwork. I’ve avoided consulting an attorney because I heard the fee would be more than the loan balance. What should I do?
A: Get rid of that real estate agent. His job is to sell properties, not to advise you on servicing a mortgage that is in default. Get all the paperwork from the agent and figure out exactly what the defaulting borrower owes you.
Then, depending where the property is located, take your documentation to either the trustee named on the deed of trust or to a local real estate attorney who specializes in mortgage foreclosures.
This should be a routine matter to either record a notice of default or file a mortgage foreclosure lawsuit. You have been far too lax. Get busy.
You will get your money when the borrower receives the official notice or, if the property goes to a foreclosure sale, from the high bidder, or you will get the property title back to sell for a second profit.
Q: About two years ago, my boyfriend and I bought a two-bedroom condo. Before we closed our purchase, we were told by our professional inspector there was a problem with moisture and rain around a bedroom window. The condo management company sent out a contractor who agreed the problem was structural and the homeowners association should pay for repairs. So we went ahead with our purchase.
Despite our repeated pleas and letters, the window still leaks. We finally contacted the president of the large homeowners association who had no knowledge of the problem, and the leak is now so serious that we can’t use that bedroom. Our son is now 2 years old and we were hoping that would become his bedroom. What should we do?
A: If I were in your situation, I would be much more aggressive. The homeowners association clearly has a duty to repair that leaky window.
I suggest writing a very polite letter to the homeowners association president, with a copy to the professional management company, stating you want this long-standing problem fixed within 30 days.
If you don’t get satisfactory action by then, it’s time to hire a local attorney who is familiar with condominium law. This problem is affecting the enjoyment of your condo, its market value and the marketability of your unit. You’ve been very patient far too long.
Q: I am a 51-year-old widow of eight years with three children, ages 9, 11 and 15. I earn only about $3,000 per month and my children receive a total of $2,100 per month in Social Security benefits.
I have owned my home for six years and currently have a 30-year fixed-rate mortgage at 5.375 percent interest. My monthly payment is $1,279 including $67 PMI (private mortgage insurance) plus $217 for property taxes and insurance. I have $16,000 in credit card debt at 8 to 10 percent interest, mostly for home improvements and medical expenses, and $125,000 in an IRA. My FICO score is 779.
I recently met with a financial adviser/college planner who recommends I refinance with a 20-year fixed-rate, interest-only mortgage at 6.75 percent interest.
My new payment would be $1,317 including the tax and insurance escrow but no PMI. But I would go from having $70,000 equity to almost no equity. He anticipates I will refinance again in three to five years. I would walk out with about $25,000 cash to pay off my credit cards and buy annuities. I would use the $600 saved each month on credit card debt for emergency cash reserves. Is this interest-only mortgage a good idea?
A: You appear to be doing a great job of managing your household on a limited budget. But I don’t like your being sold on an interest-only mortgage that will wipe out your equity and not build any future home equity from monthly mortgage payments.
Unless you have an FHA mortgage, you can easily get rid of that $67 monthly PMI premium if your loan-to-value ratio is below 80 percent. Just contact your lender and explain you have at least 20 percent home equity. You’ll have to pay for a new appraisal, but that will be money well spent to save $804 each year.
There’s no advantage for you to refinance from 5.375 percent to 6.75 percent interest. If you want to pay off your credit cards, get a home equity line of credit. With your superb FICO score, your bank should eagerly approve a credit line at prime rate or lower.
Q: I am a real estate investor with an interest in getting certified to appraise residential and/or commercial properties. Someone told me that fewer appraisers will be needed due to the availability of information on the Internet. I don’t want to waste my time or money if property appraisers will not be in demand in the near future. What is your opinion?
A: I suggest you take a basic real estate appraisal course at your local community college next semester. After completing the course and talking with the instructor, you will know if you like appraisal work and what the future is for appraisers.
The special report, “Pros and Cons of Living Trusts to Avoid Conservatorship, Probate Costs and Delays for Your Heirs,” available for $5 from Robert Bruss, 251 Park Road, Burlingame, Calif., 94010, by credit card at (800) 736-1736 or at www.bobbruss.com. Questions for this column are welcome at either address.
Source:
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2007/08/26/REBNRLUPU.DTL
investment property
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