Join Us At The Inman Agent Reboot Social Media Conference In Boston On Oct. 13th!

by Rich Vetstein on October 5, 2010

in Real Estate Marketing, Social Media

We here at the Blog, through our new company, HubConnected, are proud to be a sponsor of the Inman News Agent Reboot Conference coming to Boston, Hynes Convention Center on October 13th! We’ll be there with a slew of social media savvy realtors from around Greater Boston, some of whom are already part of the growing HubConnected network!

Click here to find out more information about the Agent Reboot Conference–Boston. If you are interested in attending, let us know, and we’ll reserve you a space! It’s only $99.

Here is the agenda:

Must-Have Tools for the Agent with Mobile Mojo (Part 1) Get the lowdown on 10 leading cutting-edge technologies that will help you “reboot” the way you do business.

  • Presented by: Chris Smith, Co-Creator, Tech Savvy Agents, @techsavvyagent

From Clicks to Closings: Turning Your Online Marketing Strategy into a Lead Machine. Video, virtual tours, single property websites – there are dozens of options for marketing properties online. Not all methods are created equal though. Find out which ones will keep your pipeline of prospects full, while saving you time and money.

Panelists:

  • Kerm Foltz, VP of Sales, Market Leader, @market_leader

Mastering Social Media to Expand Your Reach Online. Learn how to develop a comprehensive social networking strategy to grow your sphere of influence. Agent Reboot’s experts will help you sharpen your online marketing skills with proven best practices for using Facebook, Twitter and other online services. Win friends, influence people, and increase sales!

Panelists:

  • David Black, CVO, SocialMadeSimple, @socialmadesimpl
  • Andrea Geller, Hot Property Chicago – Sudler Sotheby’s International Realty, @andrearealtor
  • Greg Meyer, Customer Experience Manager, Gist, @gist

Lifestyle Branding: Why it Matters. The traditional branding strategies used by the real estate profession no longer work. Connecting with today’s consumer is a whole new adventure. The last 8 years have changed the expectations of home buyers and sellers. Learn why life style branding is critical to your success moving forward.

  • Presented by: Sherry Chris, CEO, Better Homes & Gardens Real Estate @BHGRE_Sherry

Case Study: Managing Reputation and Content on the Web. Two experts will walk you through their journey towards a progressive Web strategy using social media. They’ll share lessons learned, offer tips, and show you the results of their efforts. Learn how to do it from people who have done it.

  • Presented by: Todd Carpenter, Social Media Manager, National Association of REALTORS®, @tcar

Grow Your Online Presence Presented by Zillow.com

  • Presented by: Michael Botefuhr, Manager, Partner Relations, Zillow.com, @MVBotefuhr

3 Secrets For Turning Internet Leads Into Transactions

  • Presented by: Daniel Rothamel, Founder of RealEstateZebra.com, @realestatezebra

Maximum Exposure: Publicizing Your ListingsMake sure your listings appear everywhere potential buyers are looking. Discover easy methods for syndicating listings across the Web to spread the word about your properties, and get simple tips for tracking results.

Panelists:

  • Charlie Engel, Vice President of Sales – Real Estate, Oodle, Inc, @oodle_RE
  • Chris Smith, Co-Creator, Tech Savvy Agents, @techsavvyagent

Must-Have Tools for the Agent with Mobile Mojo (Part 2). Get the lowdown on 20 MORE leading edge technologies that will help you “reboot” the way you do business.

  • Presented by: Chris Smith, Co-Creator, Tech Savvy Agents, @techsavvyagent

5 Rockin’ Reasons to Scrap Your Static Website and Go WordPress!

  • Presented by: Daniel Rothamel, Founder of RealEstateZebra.com, @realestatezebra

Going Local: What Does It Take to Win in Boston Real Estate?It’s no secret that the industry has had its share of ups and downs in the last year. So, what lies ahead? Hear from leading real estate professionals who are navigating the changing landscape, and find out what steps you should be taking to ensure success in the future.

Panelists:

  • John D’Ambrogio, VP Director of Strategic Development, Baird & Warner
  • Matt Dollinger, VP Company Solutions, @properties, @mattdollinger
  • Andrea Geller, Hot Property Chicago – Sudler Sotheby’s International Realty, @andrearealtor

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U.S. Bank v. Ibanez: Supreme Judicial Court Oral Argument Oct. 7 Preview

by Rich Vetstein on October 4, 2010

in Foreclosure, Massachusetts Real Estate Law, Mortgage Crisis

Click for Ibanez Foreclosure Case Oral Argument Recap

The oral argument in the much anticipated U.S. Bank v. Ibanez companion cases is Thursday October 7, 2010 at 9:00AM at the Supreme Judicial Court, John Adams Courthouse, One Pemberton Square, Boston, MA.

If you cannot make it into Boston, you can watch the live webcast here.

Here is a link to the Ibanez-borrower side brief.

Here is the lenders’ brief.

The friend of the court brief from the Real Estate Bar Association is here.

In addition to the merits of the Land Court’s ruling, watch for a discussion of whether the Land Court’s ruling will be applied retroactively, which will leave thousands of invalid foreclosure titles intact, or prospectively, which will minimize the damage of this decision. I’ve been predicting that the SJC will strike a balance by upholding the Land Court on the merits, but applying the ruling prospectively.

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Major Lenders Halt Foreclosures Over Concerns With Faulty Documents

by Rich Vetstein on October 2, 2010

in Foreclosure, Mortgage Crisis

Updated: Bank of America halts foreclosures in all 50 states

On the eve of arguments in the controversial U.S. Bank v. Ibanez foreclosure case before the Massachusetts Supreme Judicial Court on Oct. 7, Bank of America, the nation’s largest bank, became the latest lender to halt foreclosures in 23 states because of concerns that lenders submitted faulty foreclosure court documents. Massachusetts Attorney General Martha Coakley has asked Bank of America to halt foreclosures in Massachusetts, but has not filed a formal action to do so yet.

Robo-Signing

Bank of America, JP Morgan Chase and other mortgage companies have been under pressure to review their paperwork after employees and contractors said in sworn depositions that, because of the enormous volume of foreclosures, they had not had the time to read the documents or check them for accuracy. This practice has been termed “robo-signing” where midlevel bank executives would sign thousands of affidavits a month attesting that they had personal knowledge that the facts of the case were as presented. When defense lawyers started deposing these robo-signers, they acknowledged that they could not possibly have knowledge of all the cases. The banks say this is a technicality and they will refile the proper affidavits. The defense lawyers say the practice calls the cases, and indeed the entire process, into question.

“To be certain affidavits have followed the correct procedures, Bank of America will delay the process in order to amend all affidavits in foreclosure cases that have not yet gone to judgment,’’ B of A spokesman Dan Frahm said in a statement.

A Bank of America executive, Renee Hertzler, said in a February deposition that she signed as many as 8,000 foreclosure documents a month without reviewing them. The deposition is similar to others taken from document processors at J.P. Morgan Chase and Ally Financial, which have also frozen foreclosures in the past week. The statements were taken by lawyers for homeowners contesting the seizure of their homes.

Foreclosures have stopped in these states: Connecticut, Delaware, Florida, Hawaii, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Nebraska, New Jersey, New Mexico, New York, North Dakota, Ohio, Oklahoma, Pennsylvania, South Carolina, South Dakota, Vermont and Wisconsin.

Huge Impact

The net effect of the banks’ halt on foreclosures will be that the current frenzied pace of foreclosures will slow considerably as well as the evictions of defaulting homeowners. Also, the inventory of foreclosed properties will continue to stagnate, and will not be absorbed into the market for many, many months to years to come. This is exacerbated by title insurance companies’ unwillingness to insure over potentially defective foreclosure titles due to the errors in the process. Also, state attorney generals will surely jump on this bandwagon, demanding or suing to slow down foreclosures — a no brainer political move. All of this will have a dramatic impact on the REO market and the market as a whole.

On the flip side, some economists said the breakdown could ultimately lay the groundwork for a real estate recovery. Stricken neighborhoods across the country, for example, could benefit. One big factor undermining home sales is fear of a large number of foreclosed homes coming to the market. If the foreclosures are delayed or never happen, housing prices might find a floor.

“Maybe this is like shock therapy,” said the economist Karl E. Case. “Maybe this will actually get the lenders to the table and encourage them to work out deals that are to the benefit of everybody.”

More Coverage:

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50 Ways To Lose Your Home, And Only One Way To Protect It, An Owner’s Title Insurance Policy

by Rich Vetstein on September 28, 2010

in Massachusetts Real Estate Law, Title Defects, Title Insurance

Essential-Paul-Simon-395x298-staffpicks_0She said it’s really not my habit to intrude
Furthermore, I hope my meaning won’t be lost or misconstrued
But I’ll repeat myself, at the risk of being crude
There must be fifty ways to leave your lover
Fifty ways to leave your lover

“50 Ways To Leave Your Lover” (c) Paul Simon

50 Ways To Lose Your Home

As Massachusetts real estate closing attorneys, we are often asked by buyers-borrowers, “Why should we get an owner’s title insurance policy if you are already doing a title examination?” This is a really good question, and the perfect lead in to a conversation about of the coverages and cost of a Massachusetts owner’s title insurance policy. Do you know the Paul Simon tune, “50 Ways to Leave Your Lover”? Well, there are more than 50 ways to lose your home without an owner’s title policy. Simply put, don’t take the risk of foregoing title insurance. It’s not worth it.

Title Insurance Basics

Title insurance protects homeowners from financial loss in the event that certain covered problems develop regarding the rights to ownership of their property. While all borrowers of conventional mortgages will receive a certification of title by a Massachusetts real estate closing attorney that their title is “good, clear and marketable,” there can be a host of hidden, off-record title defects that even the most careful title search will not reveal. In addition to protection from financial loss, title insurance pays the cost of defending against any covered claim.

50 Ways to Lose Your Home

Like the Paul Simon song, there are at least 50 ways you can lose title to your home if you don’t get an owner’s title insurance policy. The vast majority of these situations will not be ascertained in a typical title examination.

  1. Forged deeds, mortgages, mortgage discharges/satisfactions
  2. Deeds executed by a mentally incompetent or insane person
  3. Deed from a minor subject to avoidance
  4. Unauthorized deed from partnership or trustee
  5. Deed by foreign person vulnerable to challenge
  6. Deed from a corporation unauthorized by by-laws or resolution
  7. Undisclosed divorce of person who conveys as sole heir of a deceased former spouse
  8. Deed signed by mistake or under financial duress
  9. Deed signed under defective power of attorney
  10. Foreclosure deed where underlying foreclosure was defective
  11. Ineffective release/discharge of prior mortgage
  12. Deed of deceased not joining all heirs
  13. Missing heirs claiming interest in property
  14. Transfer void under contract law
  15. Deed includes protected public trust wetlands
  16. Ineffective release of mortgage subject to bankruptcy avoidance powers
  17. Ineffective mortgage subordination
  18. Mistakenly indexed deed/release
  19. Undisclosed federal/state tax lien
  20. Undisclosed spousal/child support lien
  21. Undisclosed lawsuit affecting property
  22. Undisclosed restrictions/covenants
  23. Incorrect legal description
  24. Errors in tax records
  25. Erroneous tax release
  26. Misinterpretation of wills
  27. Deed without right of access to public way
  28. Access eliminated by foreclosure
  29. Defective notarization
  30. Forged notarization
  31. Improperly recorded or indexed deed/mortgage
  32. Deed acquired through creditor fraud
  33. Mechanic’s lien claims
  34. Incorrect property boundaries
  35. Encroachments of buildings
  36. Federal or state estate tax liens
  37. Preexisting violation of subdivision laws
  38. Preexisting violation of zoning laws
  39. Deed from joint owner without joint tenant joining
  40. Undisclosed right of first refusal
  41. Undisclosed easement affecting property
  42. Undisclosed party wall agreement
  43. Special assessment liens
  44. Adverse claim of vendor’s lien
  45. Discovery of un-probated will
  46. Claims for prescriptive rights, not of record
  47. Easement does not conform to recorded instrument
  48. Incorrect survey
  49. Deed following lawsuit where all parties of interest not joined
  50. Deed executed under falsified power of attorney

Getting an owner’s title insurance policy is simply a “no brainer.” I did the title to my own home in Sudbury, and I got an owner’s policy. It’s a one time premium paid at closing, and stays in effect as long as you own your home, through refinances and even the death of a spouse. Please contact us about carriers, rates and coverages.

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Taking Another Stab at Massachusetts Loan Modifications: Refinancing Underwater Mortgages

by Rich Vetstein on September 21, 2010

in Fannie Mae, FHA, Foreclosure, HUD, Massachusetts Real Estate Law, Mortgage Crisis, Mortgages

The recent historic drop of mortgage rates has created a refinancing boom for qualified homeowners. Unfortunately, the refinancing wave washing over the country has paradoxically left dry homeowners who would most benefit:  those who are “underwater.” Underwater mortgages, or “negative equity” (i.e., they owe more on the mortgage than the property is worth) cause foreclosures and serves to bottle up the housing market. Thus, assisting homeowners who are underwater on their mortgage is good public policy. According to a CoreLogic study, there are currently 11 million mortgages underwater and another 2 million nearly at negative equity in the US housing market – a figure that comprises 28% of all residential properties with a mortgage. In Massachusetts, there are 225,000 properties with negative equity and another 52,000 with near negative equity.

The government has made attempts to address this crisis. Last year the Obama Administration created a loan modification program, the Home Affordable Refinance Program, to help refinance borrowers whose loans were worth up to 125% of their homes value. The program did not take hold, and only a relatively minor number of modifications/refinances occurred.

Writing in yesterday’s New York Times, former chairman of the President’s Council of Economic Advisors and current Dean of Columbia Business School Glenn Hubbard penned an intriguing column proposing easier refinancing of underwater mortgages.

Under the proposal, quasi-governmental entities like Fannie Mae, Freddie Mac, the FHA, and the VA would require loan servicers:

  • To send a short application to all eligible borrowers promising to allow them to refinance with minimal paperwork.
  • Servicers would receive a fixed fee for each mortgage they refinanced, which would be rolled into the mortgage to eliminate costs to the taxpayers.
  • The agencies would issue new mortgage-backed securities to cover the refinanced mortgages, using the proceeds to pay off the loans held in the existing securities.

The proposal also mandates that existing second lien holders provide a subordination agreement (which benefits the holder because it lowers the default risk).

The program would have immediate benefits: a distressed homeowner could save approximately 15% in their monthly mortgage payment, which would greatly help homeowner’s through the current crisis.

Is there a guarantee that this modification will become law? No, there is not, but it certainly makes sense for policymakers to move on it right away.

In the words of Glen Hubbard, “[i]f we can lower mortgage payments for struggling homeowners, it will reduce future foreclosures on federally backed loans, providing savings to the taxpayers.” And that’s a good thing for everyone.

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Vote For Us in ABA Top 100 Law Blog Contest And Get Free Beer!

by Rich Vetstein on September 20, 2010

in Blogging

Did I get your attention? Shameless, I know.

Every year, the American Bar Association Journal puts together a Top 100 Blawg (Law + Blog = Blawg) List. If you enjoy this Blog, we would be eternally grateful if you would vote for us in this contest. Click HERE TO VOTE. Please spread the word too, if you are so inclined.

If we get in the Top 100, we are going to have a celebratory soiree at John Harvard’s Brewhouse, and you’re invited!!! You can bank on it!

We also recommend voting for these fellow law blogs:

Massachusetts Family & Estate Planning Blog–Danielle G. Van Ess, Esq.

Massachusetts DUI OUI Attorney Brian Simoneau

Massachusetts Alcohol Licensing Blog

Massachusetts Estate Planning Blog–Leanna Hamill, Esq. (winner 2009)

Northwest Condo & HOA Law Blog

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Can’t We All Just Get Along? A Realtor’s Expert Advice On Civility, Emotions And Not Taking The Massachusetts Real Estate Market Personally

by Rich Vetstein on September 19, 2010

in Appraisals, Blogging, Massachusetts Property Values, Purchase and Sale Agreements, Realtors

Welcome back Guest Blogger, Realtor Gabrielle Daniels Brennan, from Coldwell Banker Residential Brokerage, Sudbury, MA! Gabrielle and her mother-partner, Carole Daniels, just launched a fantastic blog, Living In Sudbury (www.liveinsudburyma.com), which our company, HubConnected, designed and created.

Having grown up in Sudbury and now settled there with her family, Gabby’s knowledge of the Sudbury and surrounding market is unparalleled. Plus, she re-defines “concierge” service, going so far as to ensure that her buyers meet their neighbors ahead of time, get local nannies, and find the right preschool. Gabby is writing today about the mutual respect buyers and sellers should have for each other during the real estate process.

Home Buyers And Sellers, You CAN Just Get Along!

Once upon a time there was a newlywed couple house-hunting in the suburbs. They held hands as they strolled into each house, they conversed with their real estate agent about every detail of their wedding and giggled like sixth graders whenever they spoke the words “husband” or “wife.”

Then, they found the house of their dreams. The dreams that mirror “happily ever after” — it was the house they imagined having babies (2 boys and 2 girls – the girls would be twins of course and would share a room painted with Benjamin Moore’s Cotton Candy).

The happy couple told their real estate agent that they wanted to make an offer for asking price, closing the exact day that the sellers wanted to close. They had enough money from their wedding gifts and unfortunate passing of Great Grandpa Charlie to pay for the house in cash. The husband dabbled in construction, so every item that appeared as a result of the home inspection would be “no big deal.”

Both sets of parents came to see the house and everyone oooh’ed and ahhh’ed instead of bringing up the fact that the kitchen wasn’t updated, or that the family room was a little smaller than what they had thought it would be, or that the garage was under the house. The parents all talked about how happy they were and they never said anything that remotely sounded like “YOU paid ____ for this??? Our house cost $37,000 when we bought it …” And then the sellers threw a welcome party for the buyers before they moved in – just to make the proper introduction to the neighborhood.

I’m sure you are thinking that this story is a work of fiction. Nope. Well, aside from the buyers volunteering to pay the asking price and the gushing in-laws, the concept of a truly pleasant real estate transaction doesn’t have to sound so foreign. Without compromising the financial objective of either party, the real estate transaction can be pleasant and satisfying to all parties involved.

The decision to buy or sell a home is as much a personal transaction as it is business. It’s an exciting one, and a process in which I truly love being involved. And although it’s certainly not as straightforward as a show on HDTV about finding the right house, it doesn’t have to be challenging. As much as buyers would like to say that they won’t buy with their hearts, that is crazy – of course they will. It’s a home. It’s where you live. It’s where your heart is. Your life is not one big business transaction.

Everyone remembers the details of their real estate transactions. Even if they bought or sold their house 12 years ago, they will tell you exactly how the buyers or sellers acted, the items negotiated during the home inspection, the credit they received, what they negotiated during the purchase & sale agreement, and the details that still make them happy or cringe.

They may not remember the date they bought their house, but they will remember everything about the closing.

I have been involved in scores of real estate transactions. When multiple persons are involved in the decision-making process for a major life event, so much can get lost in translation and people don’t always behave in a way that they, let’s say, would be proud of if a TV crew were following them around. In addition to the number of family members and friends who know EXACTLY what is best for you, there are many people involved in a real estate transaction — buyers, sellers, two real estate agents, two attorneys, possibly two paralegals, one mortgage broker, one appraiser, at least one inspector, and, sometimes, the nosy neighbor.

If my intention with this piece were to promote the value of experienced real estate agents, this would be the part where I emphasize that it is the role of the real estate agent to quarterback the entire team involved to ensure that everyone wins.

In general, buyers are excited to buy a house. When an offer is made, it is the beginning of negotiations with the seller with the goal of consummating the sale of the home.  In today’s market, prices have adjusted and many sellers are having an understandably difficult time grasping the reality of the market.

Because of the resources available in 2010, today’s buyers are also the most knowledgeable, well informed and cautious. The market value of a house is what a buyer is willing to pay. Without giving up any money on the sale side and overpaying on the buy side, there are so many ways in which to make the real estate transaction one that is not so painful.

My thoughts below may seem pretty uncomplicated, and that is my objective. It is easier to have a smooth and seamless transaction than it is to have one that feels more like an act of Congress. It is a business transaction, but the basis of the transaction is emotional. You certainly don’t have become new best friends, but cordial is always appreciated.

1. MUTUAL RESPECT. The tone of the entire transaction is set with the first round of communication between both parties.

*   BUYERS: Be respectful of the sellers and their real estate agent. This does not translate into paying more. It shows that you will be a pleasure to deal with. Appreciate your sellers. They have cared for and maintained the house you fell in love with.

*  SELLERS: Appreciate your buyers. They love your house enough to buy it. If you receive an offer the first day on the market, it is because your house was priced right and the buyers know the market. Don’t be greedy, it will backfire.

2. DON’T TAKE THE MARKET PERSONALLY

*   BUYERS: If a seller decides not to accept your offer, it has nothing to do with what great people you are and how many friends you have in common. It’s usually about the financial picture.

*   SELLERS: Most likely, you didn’t overpay for your house.  You paid what the house was worth when you bought it. It’s exactly what the buyers want to do now – pay what the house is worth in today’s market. I’m certainly not suggesting that you don’t get frustrated or upset if you are taking a loss or not netting what you had planned, just don’t take it out on your potential buyers. What you “want” and “need” to get for your house is irrelevant. Buyers will pay what they feel it is worth and their mortgage company will lend based on what they feel it is worth.

3. WORK SMART. CHOOSE YOUR REPRESENTATION CAREFULLY.

*   Work with real estate agents and attorneys with whom you are comfortable and have trust. This isn’t the time to cut corners and do someone a favor. You deserve to have the best people on your team.

4. HICCUPS

*   Every transaction has their “thing” – something that needs to be clarified, negotiated, extended, explained. Know this ahead of time so when your own situation arises, you know that it’s normal and just needs to be dealt with.

5. NEIGHBORS

*   SELLERS: Keep in mind that the buyers are now going to have your former neighbors as neighbors.

*   BUYERS: Keep in mind that your soon-to-be neighbors are your sellers’ current neighbors.

PeopleSudbury Wayland MA Real Estate Homes like to talk, especially about real estate.

At the end of the day, it’s about common decency. It’s about mutual respect between the buyer and seller of the same house. As much as this is a business transaction, it is even more a personal one.

Gabrielle Daniels Brennan and her mother, Carole Daniels are The Daniels Team of Coldwell Banker Residential Brokerage in Sudbury. You may contact them by phone at 508-277-6956 (Carole cell), 617-320-8150 (Gabrielle Cell), or by Email to [email protected]

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What Happens In Vegas Hopefully Stays In Vegas: Some Perspective On the Mass. Real Estate Market From Las Vegas

by Rich Vetstein on September 18, 2010

in Massachusetts Property Values, Real Estate Marketing

My partner, Marc Canner, and I just returned from the Agent Reboot Conference in Las Vegas where we were promoting our new Real Estate Social Media company, HubConnected (click for more information). We learned a lot of new information about social media for real estate agents. But what really struck home was how horrible the Las Vegas, NV real estate market is, and how lucky we are to be based in Massachusetts.

How bad is the Las Vegas real estate market? Check out these stats:

Las Vegas home values have plummeted from a high of $294,000 in 2006 to $121,000 in July 2010. That’s a 59% drop.

Meanwhile, the foreclosure rates are still off the charts, comparatively. In the last month alone, approximately 13,000 Nevada  houses and condo units received a foreclosure notice, and that’s down 13.9% from the same six-month period last year. Extrapolating, that’s roughly 156,000 foreclosure for the last 12 months! Mind blowing numbers…

The Massachusetts Real Estate Market

As the above graph indicates, the Massachusetts real estate market is now officially in recovery mode, gaining from the lows of 2009.

By contrast, only about 4,100 Massachusetts homes received a foreclosure notice last month. What makes this data really amazing is that the Nevada population is around 2.6 Million, while Massachusetts is triple that at 6.5 Million.

That’s why Nevada has been the #1 state for foreclosures for 3 years running, where a whopping 1 in 84 households are in default or foreclosure. And that’s why the Las Vegas real estate market is all about foreclosure, REO properties and short sales. Thankfully, that’s not so here in Massachusetts.

So, the lesson from Las Vegas is that we Bay Staters actually have a lot to be thankful for here. It could be a lot worse. And hopefully, when it comes to real estate, what happens in Vegas, stays in Vegas!

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Don’t Touch That Deposit: Court Rules Escrow Duty Trumps Real Estate Commission Dispute

by Rich Vetstein on September 16, 2010

in Massachusetts Real Estate Law, Purchase and Sale Agreements, Real Estate Litigation, Realtors

Agents: Don’t Mess With A Buyer’s Deposit

Yesterday an interesting case came down involving a nasty tug-of-war between listing brokers and an exclusive buyer’s agent, with the buyer’s six figure deposit caught in the middle. The case is Zang v. NRT New England and can be read here.

In the case, the seller signed the standard exclusive listing agreement with the listing broker which provided for a 5% commission, and cooperation with buyers’ brokers, with an equal split of the commission. Mr. Zang, a potential buyer, showed up at an open house for the condominium, unaccompanied by a broker.  The buyer made an offer through the listing agent, but an agreement couldn’t be reached.  The buyer then hired an exclusive buyer’s agent who submitted a second offer.  The offer was ultimately accepted by the seller, and the parties proceeded to sign a purchase and sale agreement.

The listing broker, however, was none too pleased that the buyer’s broker had entered the picture at the final hour looking for a commission. The listing agent even left a few amusing voicemail messages for the buyer, asking him whether “you think that it’s really fair that [the buyer’s agent] should come in at this late date and capture half of the commission… and what does Alan [one of the listing agents] get for all of his work? Nothing. But, you know, I guess that’s money in your pocket.”

The buyer posted a $122,500 deposit (10% of the purchase price) upon the execution of the purchase and sale agreement. The agreement provided that the listing agent would act as escrow agent and that a 5% commission would be paid by the seller to the listing agent and the buyer’s agent, split equally. In short, the seller’s net sales proceeds were to be reduced by $61,250, of which $30,625 was to be paid to the buyer’s agent at closing.

After the closing, however, the listing agent refused to pay the buyer’s broker his commission, and refused to disburse the remaining escrow deposit, essentially holding it hostage.  Big no-no, said the Appeals Court.  While the listing agent may have a legitimate dispute over the commission, the court ruled, its fiduciary duties as escrow agent took precedence. The listing agent had no right to retain the buyer’s money, and was contractually obligated to disburse it according to the purchase and sale agreement, period.  The court did not sanction this sort of self-help by the listing agent.  And the court let stand the buyer’s claims for 93A/consumer protection violation which carries triple damages and attorneys’ fees.

So the lesson for real estate agents here is don’t mess with a deposit even if you feel you have a legitimate beef over a commission.  It’s not worth it, and it will subject you to liability.

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Pay Extra Attention To Mortgage Financing Contingency Clauses During Today’s Credit Crunch

by Rich Vetstein on September 6, 2010

in Massachusetts Real Estate Law, Mortgages, Purchase and Sale Agreements, Title Defects

iStock_000005550102XSmall.jpgToday’s strict lending and underwriting environment has resulted in quite a few delays and even losses of buyers’ financing for home purchases. Loan commitment deadlines are being pushed back due to underwriting delays, regulatory compliance and appraisal issues, among other delays. The worst case scenario for any borrower is the wholesale rejection of financing in the middle of a transaction.

What Is The Typical Mortgage Contingency Clause?

The Massachusetts “standard” form purchase and sale agreement contains a mortgage contingency clause which protects the buyer (and his deposit) for the period of time until he can obtain a firm loan commitment. The date is negotiated by the buyer and seller, and is usually around 30 days from the execution of the purchase and sale agreement, depending on the closing date. If the buyer cannot get a firm loan commitment by the deadline, he can opt out of agreement with a full refund of his deposit. Here is how a typical Massachusetts mortgage financing contingency clause operates:

In order to help finance the acquisition of said premises, the BUYER shall apply for a conven­tional bank or other institutional mortgage loan of $300,500.00 at prevailing rates, terms and conditions. If despite the BUYER’S diligent efforts, a commitment for such a loan cannot be obtained on or before October 15, 2010, the BUYER may terminate this agreement by written notice to the SELLER in accordance with the term of the rider, prior to the expiration of such time, whereupon any payments made under this agreement shall be forthwith refunded and all other obligations of the parties hereto shall cease and this agreements shall be void without recourse to the parties hereto. In no event will the BUYER be deemed to have used diligent efforts to obtain such commitment unless the BUYER submits a complete mortgage loan application conforming to the foregoing provisions on or before 3 days from the execution of this Agreement.

What If There Are Delays In Obtaining My Loan Commitment?

The buyer really has only two choices if the lender cannot deliver a firm loan commitment by the mortgage contingency deadline: (1) ask the seller for an extension of the loan commitment deadline, or (b) terminate the transaction. There is, however, a smart way to handle this situation.

I always couple a request for a loan commitment extension with notice that if the seller does not agree, then the buyer will exercise his right to terminate the agreement. That way, the seller has to make a tough choice: grant an extension or lose the deal. If the seller does not want to grant an extension, the buyer really has no other choice but to move on to the next home for sale.

Parties need to make mortgage contingency deadlines workable and don’t wait until the last minute to ask for extensions. See this post about a recent case for what happens when you don’t do this.

What If There Are Conditions In My Loan Commitment That I Cannot Control or Meet?

Loan commitments are often riddled with conditions which must be reviewed carefully with counsel. Sometimes, there are conditions that a buyer simply cannot meet or control. To account for this I always insert this clause in my Massachusetts purchase and sale agreement rider:

Application to one such bank or mortgage lender by such date shall constitute “diligent efforts.”  If the written loan commitment contains terms and conditions that are beyond BUYER’S reasonable ability to control or achieve, or if the commitment requires BUYER to encumber property other than the subject property, BUYER may terminate this agreement, whereupon any payments made under this agreement shall be forthwith refunded and all other obligations of the parties hereto shall cease and this agreement shall be void without recourse to the parties hereto.

This protects the buyer in case there are those uncontrollable conditions, and also limits the buyer’s efforts in applying for a mortgage to 1 application.

What If There Are Title Defects Which Delay The Transaction And My Rate Lock Expires?

Under paragraph 10 of the Massachusetts standard form purchase and sale agreement, the seller has the option (or the requirement, depending on the negotiation of the agreement) to cure any title defects, and has up to 30 days to do so. Sometimes, during this 30 day cure period, the buyer’s rate lock will expire. In this situation, I insert the following clause into the purchase and sale agreement:

MODIFICATION TO PARAGRAPH 10: Notwithstanding anything to the contrary contained in this Agreement, if SELLER extends this Agreement to perfect title or make the Premises conform as provided in Paragraph 10, and if BUYER’S mortgage commitment or rate lock would expire prior to the expiration of said extension, then such extension shall continue, at BUYER’S option, only until the date of expiration of BUYER’S mortgage commitment or rate lock.  BUYER may elect, at its sole option, to obtain an extension of its mortgage commitment or rate lock.

This gives the buyer an “out” of the transaction if his rate lock expires.

As always, feel free to contact me, Richard Vetstein, for any questions about the Massachusetts purchase and sale agreement process.

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Richard Vetstein Talks Real Estate Law On “Money Matters” Radio Show

by Rich Vetstein on September 3, 2010

in Massachusetts Real Estate Law, Real Estate Marketing

I had the pleasure of sitting down for a 1 hour radio interview on real estate law for Money Matters Radio. The podcasts for the show are below. (They are 30 minutes each, so be advised). The hour went by so fast!

There was a funny thing that happened during the interview. My dad was listening, and he texted me during the show, which buzzed my Iphone in my pocket. During a break, I told the host about my dad’s text, and then the host made sure he said “Hi” to my dad over the air. It was pretty funny. Well, without further adieu:

Click this link for Rich Vetstein’s Money Matters Radio Interview on Massachusetts Real Estate Law (Part 1). Topics: The Closing Process, Title Examinations, Title Insurance, Homeowners & Condo Insurance.

Click the link for Part 2 of the Interview. Topics: Real Estate Litigation, Foreclosures, and Short Sales.

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Hurrican Earl To Hit Eastern Massachusetts Hard: Safety and Insurance Claims Information

by Rich Vetstein on September 2, 2010

in Insurance, Safety

Reports are now saying that Hurricane Earl’s track has changed and will hit Massachusetts and especially Cape Cod & the Islands harder than expected. David Gaffin, of Greenpark Mortgage and the Massachusetts Mortgage Blog, is kind enough to let us re-post this article about safety information and insurance claims in preparation for the storm surge.

When a Hurricane is Headed Your Way

Careful preparation and planning before a storm arrives will help minimize damage, loss and grief.  The following is a short listing of what could be done to prepare yourself and your family during this season.

Pre-Planning:

Obtain information on flood zones and evacuation shelters.  in some area, these can be found in your telephone book or online.

  • Plan an evacuation route to the nearest shelter or “safe” area and keep a map handy.  During emergencies, shelter locations be also be announced on the radio.
  • Replenish emergency kits and supplies.
  • Secure important documents from possible damage or move to a safe location.
  • Develop a list of important phone numbers.
  • Develop a plan to secure loose objects around the house; trim branches and trees.
  • Ensure that your pets have collars and identification tags.

Prior to the Hurricane:

Secure all loose objects outdoors.

  • Secure all windows using plywood.
  • Fill your vehicle with fuel.
  • Charge all batteries (i.e. phone, lamps, flashlights, radios, etc.)
  • Listen to the emergency broadcasts of the storm.
  • Be prepared to evacuate with emergency supplies to a predetermined location.

During the Hurricane:

Stay in doors and away from windows.  Keep to the center of the building on the ground level.

  • Listen to the emergency broadcast on the radio or television.
  • Turn off all electrical devices and appliances that are not needed.
  • Stay away from coastal waters, rivers, streams or other flooding areas.
  • Do not try to cross flooded areas with your vehicle.
  • Listen for instructions from emergency officials when the storm is over.

Emergency Supplies and Kits:

First aid kit and personal medications

  • Drinking water
  • Ice Chest
  • Lighter, matches and candles
  • Clothing, personal toiletries
  • Sleeping bags and blankets
  • Portable radio and flashlight
  • Extra batteries
  • Non-perishable foods
  • Manual can opener
  • Important documents
  • Quiet games, books, or toys for children

Here are the carrier’s phone numbers:

Acadia Insurance (800) 691-4966
AIG (Global Energy) (877) 743-7669
AIG (Private Client Group ) (866) 642-5246
Andover Companies: Cambridge Mutual & Merrimack Mutual (800) 225-0770
Chubb Group (800) 252-4670
Commerce (800) 221-1605
Fireman’s Fund (888) 347-3428
Great American (888) 882-3835
Guard Insurance Group (888) 639-2567
Hanover Insurance (800) 628-0250
Hartford Insurance (800) 327-3636
Hingham Mutual (After hours claims) (800) 972-5399
Mass. Property Insurance Underwriting (800) 851-8978
Trident (After hours claims) (800) 288-2502
Tower (877) 365-8693
Quincy Mutual (800) 490-0047
Safety Insurance (800) 951-2100
Selective Insurance (866) 455-9969
Splash Program (Emergency Pollution related claims) (866) 577-5274
Splash Program (Emergency Non-Pollution related claims) (800) 746-3835
Travelers Personal lines:
(877) 425-2466
Commercial:
(800) 832-7839
Utica National (800) 216-1420
Vermont Mutual (After hours claims) (800) 445-2330
Zurich/Maryland (800) 565-6295

I would like to thank Gary Nagle (781)-235-0502 of Corcoran and Havelin Insurance in Wellesley, MA for sending me the following Hurricane Safety and Preparedness list along with the telephone numbers of the major Homeowner Insurance carriers for Massachusetts.

If you do not currently have homeowner’s insurance please do not call today to get any, as the carriers will not write coverage until after the storm passes.

Please use this well and be safe on this long holiday weekend.

By the way readers, should you be closing on a purchase or refinance after the storm passes and the Feds declare a Federal Disaster Area, be prepared to have a re-inspection of the property before closing.  This is considered to be an Act of God and as a result the borrower will be required to pay for any re-inspection fee.  These re-inspections range from $125 to $200.  You will receive notice from your lender and re-disclosures prior to closing.

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Massachusetts Mortgage Rate Lock Advisory: Even More Historic Lows!

by Rich Vetstein on September 1, 2010

in Mortgages

Mortgage Guy, Brian Cav, is back with his Massachusetts weekly mortgage rate report.

Mortgage Rates hit new lows yesterday. If you have refinanced over the past 2 years there is a 70% chance you can refinance to 0.5% lower in rate and pay NO closing costs. The 30 year fixed mortgage rate has fallen down to the  4.25% to 4.375% range for well-qualified borrowers. Can you say high 3.875%,  30 year fixed rate paying points?!?!  These rates are amazing and may not be down this low again, I would take the safe play and LOCK in your purchase or refinancing application right now. Please call/email it only takes you 5 minutes to LOCK in at today’s new all-time low rates.

Inquire within for current Mortgage Rates or guidelines [email protected] 617.771.5021

Economic Data

Wednesday’s bond market has opened down sharply after this morning’s economic data showed surprising strength. The stock markets are heavily influencing bond trading with significant gains. Stocks have had quite a strong reaction to this morning’s news, pushing the Dow up over 230 points and the Nasdaq up. The bond market is currently down, which will likely push this morning’s mortgage rates higher by approximately .250 of a discount point. Strength in bonds late yesterday is helping to prevent a larger increase to this morning’s rates.

Today’s news came from the Institute for Supply Management (ISM), who released their manufacturing index for August late this morning. They announced a reading of 56.3 that was not only well above forecasts, but also an increase from July’s reading. This means that manufacturer sentiment about business conditions was much stronger than analysts had expected. When this happens, bonds tend to move lower and stocks higher as it is a sign of economic strength.

Yesterday afternoon’s release of the minutes from the last FOMC meeting didn’t reveal any significant surprises, but did indicate that the Fed is considering, or at least willing to invest more funds into mortgage-related securities. That can be considered good news for bonds and mortgage rates since the additional buying should drive mortgage pricing lower. However, it is just a thought at this time and cannot be given much weight until the Fed does decide to pursue that route.

There are two reports scheduled for release tomorrow morning that have the potential to influence rates. The first is the revised 2nd Quarter Productivity numbers, which measures employee productivity in the workplace. Strong levels of productivity allow the economy to expand without inflation concerns. It is expected to show a downward change from the previous estimate of a 0.9% decline. Forecasts are currently calling for a 1.7% drop, meaning productivity was weaker than previously thought. This would be negative news for the bond market and mortgage rates, but this data is not one of the more important reports we see each quarter. Therefore, unless there is a large variance from expectations, this report will likely have little impact on tomorrow’s rates.

July’s Factory Orders data will also be released tomorrow morning. This report measures manufacturing sector strength and is similar to last week’s Durable Goods Orders, but includes orders for both durable and non-durable goods. It is expected to show a 0.3% increase in new orders. A smaller than expected rise would be favorable for bonds, while a large than forecasted increase could lead to higher rates tomorrow morning.

Also worth noting are weekly unemployment figures that will be released by the Labor Department early tomorrow morning. They are expected to say that 475,000 new claims for unemployment benefits were filed last week. Since this data tracks only a single week’s worth of claims, it usually takes a fairly significant surprise for mortgage rates to react. This is especially true when monthly figures will be posted the following day, as is the case this week.

FLOAT or  LOCK

If I was closing on a Home Mortgage in the next 0 to 15 Days – LOCK

If I was closing on a Home Mortgage in the next 15 to 30 Days – LOCK

If I was closing on a Home Mortgage in the next 30 to 60 Days – LOCK

If I was closing on a Home Mortgage in the next 60+ FLOAT

This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.

  • Are you a possible Massachusetts First Time Homebuyer?
  • Do you have a Real Estate client inquiring about current Mortgage Rates?
  • Do you have any Refinancing questions?
  • Should you be thinking about Refinancing out of your ARM (Adjustable Rate Mortgage)?
  • Have your Real Estate clients been Pre Approved?

[email protected] 617.771.5021

Credit: Bloomberg, Yahoo Finance, Mortgage News, MBS Quoteline, WSJ, NY Times

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Debunking The July 2010 Housing Report: 5 Reasons Why Massachusetts Home Sales Will Continue To Rise

by Rich Vetstein on August 27, 2010

in Massachusetts Property Values

A National Association of Realtor’s report released Wednesday indicated that home purchases fell 27% in July, a drop that jolted the real estate industry, according to the Wall Street Journal, and sent shock waves through the broader economy. As a result, a number of economists provided dire warnings of a continued down slide in real estate prices.

At first blush, this news could have the “echo chamber” effect of  turning the purported downturn into a self-fulfilling prophecy, discourage consumer confidence, and sidelining a number of prospective Massachusetts home buyers from the fall housing market.  Here are 5 reasons why the national housing report won’t impact the Massachusetts real estate market.

1.  Massachusetts Has a Strong Housing Market.

Massachusetts has bucked the national trend as its housing market has remained strong. Indeed, parts of the Massachusetts housing market actually saw a surge in activity in July 2010:

  • From July ’09 to July ’10, these towns had an surge in sales:
  1. Norwood (+117%)
  2. Bedford  (+78%)
  3. Easton (+27%)
  4. Brookline (+20%)
  5. Melrose (+20%)
  • Several towns saw an  increase in year-to-date median home prices in July, including:
  1. Cohasset (+25%)
  2. Marblehead (+12%)
  3. Dennis (+6%)
  4. Norwood (+5.9%)
  5. Melrose (+4%)

2.  The June 1st Time Tax Buyer Credit Caused An Artificial Decrease in July Purchases.

The government stimulus program brought out the seasonal first time buyer’s in full force during June. Thus, the normal sales cycle was altered which skewed the July numbers

3.  Massachusetts Is Always Out In Front Of The National Numbers

The national housing report gives equal weight to markets blighted with foreclosures and economically hard hit areas like Detroit, Las Vegas, Florida, Arizona and parts of Southern California. Greater Boston has historically been a unique “inelastic” market along the lines of Washington, D.C. and San Francisco. Negative national trends do not necessarily correlate to the Massachusetts real estate market.

4.  “It’s the Economy, Stupid.”

Massachusetts has a strong and diverse economy, a number of high paying jobs (no, I’m not running for governor), a very limited number of new housing starts, and several industries that have constant employment turnover- a tried and true recipe for a hot housing market.

5.  Historically Low Interest Rates

The average rate for a 30 year mortgage has fallen to 4.5%, a 50 year low! Prospective borrowers who pass on this- caveat emptor “buyer beware.” A number of economists predict that the Fed will gradually ease rates back up to counter inflation.

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The Impact Of The Mortgage Reform & Anti-Predatory Lending Act On The Conventional Residential Lending Industry

by Rich Vetstein on August 25, 2010

in Disclosures, Massachusetts Real Estate Law, Mortgage Crisis, Mortgages

The new Mortgage Reform and Anti-Predatory Lending Act, buried in the fine print of the much publicized Dodd-Frank Wall Street Reform and Consumer Protection Act contains strict new rules aimed at preventing another sub-prime mortgage collapse.

Overview: What Is The Impact To Mortgage Lenders and Originators?

The Mortgage Reform and Anti-Predatory Lending Act certainly changes the regulatory landscape for mortgage originators who focused on high-risk, sub-prime lending, setting tougher new standards and creating new federal remedies for consumers victimized by deceptive and predatory lending. Stripped down, the Act puts the onus on mortgage lenders and originators to ensure, based on verified and documentation information, that borrowers can afford to repay the loans for which they have applied. Pretty novel idea, huh?

The new law essentially codifies good underwriting practices by requiring consideration of a borrower’s “credit history, current income, expected income the consumer is reasonably assured of receiving, current obligations, debt-to-income ratio or the residential income the consumer will have after paying non-mortgage debt and mortgage-related obligations, employment status, and other financial resources other than the consumer’s equity in the dwelling or real property that secures repayment of the loan.”

I don’t see anything in these rules that a financially prudent lender wouldn’t have already implemented in its underwriting processes. Lenders should not be placing borrowers into loans they are doomed to fail.

I’m sure these new rules will result in a few more disclosures and forms, but I don’t see this making a major impact on the conventional residential lending industry. If mortgage professionals think otherwise, I’d love to here from you. Well, onto the details:

New Minimum Mortgage Affordability Standards

The new law essentially outlaws many of the characteristics of the classic sub-prime, predatory mortgage loan, by requiring that:

  • The mortgage provides that regular periodic payments do not result in an increase of the principal balance of the loan or allow the consumer to defer repayment of principal.
  • The mortgage does not result in a balloon payment (a scheduled payment that is more than twice as large as the average of earlier scheduled payments).
  • The income and financial resources relied upon by the lender have been verified and documented.
  • The underwriting process for a fixed loan is based on a payment schedule that fully amortizes the loan over the loan term, taking into account all applicable costs.
  • The underwriting process for an adjustable rate loan is based on the maximum rate permitted under the loan for the first five years and a payment schedule that fully amortizes the loan over the loan term, taking into account all applicable costs.
  • The mortgage complies with guidelines and regulations related to ratios of total monthly debt to total monthly income or alternative measures of a borrower’s ability to pay.
  • The mortgage has total points and fees amounting to no more than 3 percent of the total loan amount.
  • The term of the loan does not exceed 30 years.

It would appear that this new law would prohibit so-called “no doc” “no income verification” loans.

The new law also imposes on lenders a duty to verify amounts of income or assets that the lender relies upon to determine the consumer’s ability to repay the loan. Again, a novel idea…In order to “safeguard against fraudulent reporting,” lenders are now required to use IRS  transcripts of tax returns.

New Loan Origination Standards

The new law requires that lenders be qualified and registered as mortgage originators under the applicable federal and state laws. The significance of this registration procedure is that all loan documents will require the inclusion of the mortgage originator’s unique identifier, which is to be provided by the National Mortgage Licensing System and Registry. This will enable tracking of the bad guys.

“Steering Incentives” Prohibited

The Dodd-Frank Act will prohibit lenders from “steering” borrowers into more costly loans. It will prohibit mortgage originators from mischaracterizing the credit history of a consumer or the residential loans available to the consumer for purposes of making the loan. Mortgage originators are also prohibited from discouraging consumers from seeking a residential mortgage loan from another lender when the former is unable to suggest, offer, or recommend a loan that is not more expensive.

Predatory Loans Banned

Mortgage originators are prohibited from steering consumers to residential mortgage loans that have “predatory characteristics or effects.” “Predatory characteristics,” include equity stripping, excessive fees, or abusive terms.

Yield-Spread Premium Bonuses Outlawed

The Dodd-Frank Act also imposes new compensation limitations by prohibiting yield-spread premium bonuses, a practice, regulators argue, tends to increase the total cost of the loan to the borrower. Yield spread premiums (YSPs) are fees paid by a lender to a mortgage originator for placing a loan in a certain loan program.

Additional Liability for Mortgage Originators

The Act imposes liability on mortgage originators who fail to comply with these new minimum standards. It provides the penalty of triple damages plus the costs of suit and reasonable attorneys’ fees. Watch out for class actions here!

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Massachusetts Real Estate Values Down, But Real Estate Taxes Continue To Rise

by Rich Vetstein on August 22, 2010

in Abatement, Massachusetts Real Estate Law, Real Estate Taxes

Benjamin Franklin once famously said, “There is nothing certain in life but death and taxes.” And this is most certainly true for real estate taxes in Massachusetts which continue to rise despite declining home values.

As reported in the Boston Globe today:

Despite dropping home values, Massachusetts property tax bills continued to rise last year. Revenue-hungry cities and towns, looking for money to pay for new buildings and to maintain services, have continued to push up local taxes, often asking voters to approve property tax overrides even as real estate values drop further.

The double whammy of lower home values and higher taxes — a phenomenon that has hit Massachusetts homeowners for several years — frustrates taxpayers as they endure the rocky economy.

Massachusetts home values, after peaking in 2007, have dropped about 4.6% last year to an average of $373,702. Yet the average tax bill on a single-family home in fiscal 2010 increased about $140, a 3.3 % increase, according to figures released this month by the state Department of Revenue. The average tax bill for a single-family home was $4,390.

Taxpayers want to know why, and many have had enough. Part of the problem is that assessed values, which municipal assessors use to calculate real estate taxes, lag behind “true” market value. Rick Henderson, the assistant director of assessing in Dedham, points out that assessed values for fiscal 2010 are based on a home’s worth on Jan. 1, 2009, which was determined by home sales in 2008 in that community. A home’s actual value — different from its assessed value — might have declined significantly over the last two years, he said.

Taxpayers can file for an abatement to petition for a lower assessed value. Abatements are due within 30 days of the mailing of the tax bill, and are subject to very strict deadlines, so consult an experienced real estate attorney about an abatement.

The other problem is that local boards of assessors have consistently increased the municipal tax rates to bridge the shortfall in expected collections. For example, in Sudbury, the local assessors raised the residential tax rate from $14.27 in 2008, to $15.29 in 2009, to $16.08 in 2010. During the same period, average home assessed values dropped $33,000, so property taxes continued to rise. Proposition 2 1/2 does not limit the ability of assessors to increase tax rates; it only limits the aggregate tax levy brought in by a town. With the passage of local overrides of Prop 2 1/2, tax bills have increased dramatically in the last 10 years. In Sudbury, the average tax bill in 2000 was nearly $6,000. In 2010, it is $10,460–a 74% increase in 10 years time, or an average of 7.4% per year.

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Ibanez Foreclosure Case Update: Appellate Briefs Filed

by Rich Vetstein on August 19, 2010

in Foreclosure, Massachusetts Real Estate Law, Mortgages

The briefs in the US. Bank v. Ibanez foreclosure case in the Supreme Judicial Court have been filed.

Here is a link to the Ibanez side brief.

Here is the lenders’ brief.

The case is still set for oral argument in October, with a decision expected in late Fall, early Winter.

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Massachusetts Construction Prompt Pay Law Passed

by Rich Vetstein on August 19, 2010

in Construction Law

As reported in Banker & Tradesman:

A new law requiring construction payments to be paid “promptly” has been passed, which advocates say is one of the most significant pieces of legislation affecting private construction since the reform of the state’s mechanic’s lien law in 1996. The bill was sponsored by the Associated Subcontractors of Massachusetts Inc. (ASM) and otherwise known simply as the “Prompt Pay Law.” It takes effect Nov. 8, 2010, 90 days after it was passed.

The law only covers construction projects over $3 Million, so the vast majority of residential home improvement projects won’t be affected.

The new law sets reasonable time periods for processing payments on a project, both routine progress payments and payments for change orders, which are often held up for indefinite periods. It also all-but-eliminates the use of controversial “pay if paid” terms to avoid having to pay altogether; and it provides the right to stop work for nonpayment without risking breach of contract.

By requiring prompt decisions on approval (or rejection) of payment requests, and timely payment of amounts due, the law will keep funds flowing on projects, according to a statement.

The new law is the result of a nearly five year effort by ASM to address chronic payment delays in construction.

Companies typically wait three months, often longer, to receive payment for their work, while continuing to buy materials and pay workers weekly.

Thirty-two other states currently have similar laws in place.

“Jobs and businesses were on the line here,” said Monica Lawton of Associated Subcontractors of Massachusetts. “This legislation provides a fair, common sense approach to ensure companies and workers get paid-and get paid on time.”

“This legislation will help prevent company closures and layoffs in the months ahead, and over the long term, will help restore fair dealing to an industry that has long been out of balance” said Richard Fisher of Beverly’s Red Wing Construction. “This is an important step to improve our industry, and help small businesses and their employees in this tough economy.”

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Massachusetts Sales Tax Holiday: Home Buyers, Please Wait Until After Your Closing To Splurge

by Rich Vetstein on August 14, 2010

in Fannie Mae, Mortgages

I’m never one to rain on a good shopping day parade, but the Massachusetts sale tax holiday scheduled for this weekend, could cause some problems for home buyers who intend on makes big purchases over the weekend, but haven’t closed yet on their real estate transaction.

The reason is Fannie Mae’s new Loan Quality Initiative (LQI) rules which have resulted in lenders pulling last minute credit reports and additional verifications of borrower information. If you have racked up a big credit card bill before your closing, these last minute credit checks pull could result in a closing delay, pricing adjustment, or, worst, loan approval cancellation.

So, I hate to say it, but the best thing to do for home buyers is WAIT until after your closing to buy those new appliances at Sears.Your loan officer will thank you!

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Happy Birthday To This Blog: A Statistical Review of Year 1

by Rich Vetstein on August 12, 2010

in Blogging, Real Estate Marketing

It’s been a year since we launched this Blog in its current form, and it’s been an amazing year. I remember getting giddy over 30 hits in one day; now we get thousands. Good times.

The fun part about having a Blog is analyzing the statistics, which can be a bit addicting, like when I used to play Strat-O-Matic baseball at overnight camp. So here are some stats crunching from the last year:

  • 274,873 total page views
  • Busiest month: April 2010: 49,145 page views. See below for why.
  • Busiest day: April 15, 2010–4,500 hits. This was tax day, and most people were searching about the Mass. flooding tax extension.
  • 2.9 average pages per visit
  • 20% bounce rate (the percentage of visitors who leave the site after only one page visit–the lower, the better)
  • 2:24: average time on site (shows you only have a limited attention span for readers–keep posts short and to the point).
  • 83% of visitors are new to the Blog
  • 79% of traffic came from search engines; remaining 21% came from link referrals (Facebook, Twitter) and direct traffic
  • Visitors came from as far away as Australia, Brazil, China (got around the censors), India, and Malaysia.

Top Posts For The Year

  1. New Strict FHA Condo Lending Rules Sure To Chill Sales
  2. The Catch 22 Impact Of The New Fannie Mae Condo Rules
  3. There’s Nothing Standard About the Massachusetts Standard Purchase & Sale Agreement
  4. Short Sales Get Boost From Obama Treasury Guidelines

Blog Platform: WordPress; Theme: Thesis

But Have You Generated Business From Blogging?

Of course, the million dollar question is whether blogging has resulted in leads and business. Without divulging actual numbers, I can say emphatically HELL YEAH! In fact, I estimate that leads generating from this Blog account for at least 40% of all new business development for my firm, the Vetstein Law Group, and to our sister company, TitleHub Closing Services.

It’s an investment in time mostly, but I love to write, I’m a bit of a techie, and I love learning about new things in my industry. If that appeals to you, consider starting a blog, like many of my Realtor and attorney friends have done or are considering now. Plus, the real estate business is very much oriented to online marketing and social media.

I can help you get going.

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