All posts by tfsammons

How to check exemptions on Cook Co. Real Estate Taxes

Real Estate-Purchases, Real Estate-Sales,

The exemptions on Cook Co. real estate taxes used to be :

1. Homeowner’s exemption;

2. Senior citizen exemption;

3. Senior Freeze.

We just got four more exemptions (disabled, disabled veteran, Long-Term Occupant and Returning Veteran). It used to be hard to understand, now it’s impossible!

If you are considering buying a property in Cook Co. you should know what exemptions are on the property, so that you get the correct tax credit. The easiest way to do this is to look at a copy of the second installment tax bill. Unfortunately, the Cook County Treasurer does not break down the exemptions on their website.

The next best way to check the exemptions is to use the Cook County Assessor’s website. Here is how to do it.exempt

Predatory Lending Database

Real Estate-Purchases

Another layer of administrative hassle has been added to the real estate world. On July 1, 2008, all of Cook County will be subject to the Predatory Lending Database Program. The purpose of this mess of  a program  is to stop lenders from forcing bad loans on people. (After many years of doing closings, my view is that most people know what they are getting in a bad loan, but sign up for it anyway!)

It works like this: A mortgage document cannot be recorded in Cook County unless a “certificate of compliance” or a “certificate of exemption” is attached to the mortgage. It only applies to owner-occupied, 1-4 unit homes.

This applies to all refinances and all purchases by first-time buyers where any of the following loans are being used: Interest only, negative amortization, more than 5 points being charged, a prepayment penalty or an adjustable of 3 years or less.

If the buyer/refinancer fits this profile, he has to go to counseling  (scream therapy may be needed by those sitting through the session) and if it’s determined he really, really still wants the mortgage, the certificate of compliance is issued and then the closing will occur.

The problem is that it’s too much hassle, an extra expense ($100-$200 just for the certificate) and it’s about 2 years too late. Most of the mortgage programs that are targeted here are gone, wiped out by the sub-prime cleansing.

Long term occupant exemption

Uncategorized

Many Cook County homeowners received a long term occupant exemption application in the mail from the Cook County Assessor. If you have lived in your house for more than 10 years, and your income is under a certain level, the increase in the assessment level of your real estate taxes will be limited to either 7 % or 10% by signing the form.

The assessor has no mention of this on his site which is weird.

This is a strange “exemption” and I, for one, really don’t see the need or reason for it.

Living Trust Dinner Seminars

Estate Planning, Living Trusts

A client called to say he got a direct mail invite to a living trust dinner seminar.

At the seminar, act 2 would be some awesome chicken vesuvio. But, in act 1, the presenter promised to reveal several important provisions that should be in every trust, so the trust didn’t “fail.”

My client wanted to know if the trust I did for him a few weeks ago had “the 11esssential things” that the mailer said were needed in all living trusts.  I reassured my client that it had these provisions. My client said he could go to a living trust dinner once every week, if he had the fortitude to suffer through the presentation.

The worst living trust seminars are put on by annuity sales guys.  They will try to get you to invest every spare cent you have, including all IRA money, in annuities.  You never meet with an attorney. These are called “trust mills” and you want to avoid them.  Some trust mills get sued.

Attorneys put on living trust seminars too.  Most seminars like to use the words “nursing home,” “medicaid” and “probate” a lot.  Most attorney seminars are average at best. The seminar attorneys tend to charge quite a bit for their trusts. That’s because they have to factor the cost of feeding dinner to 40 people into it.

So you want to buy a foreclosure?

Real Estate-Purchases,

So you want to buy a foreclosed house? They are everywhere and everyone and their brother wants to buy one. But are you sure you can bear the pain of buying a foreclosed property?

While the purchase price will be low, buying a foreclosed property is not for the overly picky, the perfectionist or someone who thinks the “customer (i.e. Buyer) is always right.” There are several different categories of foreclosures like “short sales” and buying directly at the sheriff’s sale, but here we are talking about buying a foreclosed property from the lender that foreclosed the loan. These are called REO (Real Estate Owned) properties. I call them a big headache.

Positives

Get a good price.

Usually closes quickly.

No one living in the house to evict.

Negatives

It will take 2-3 weeks to get the Seller to sign the contract.

Can’t schedule home inspection until the contract is signed.

Utilities are turned off when you go to do the inspection.

If property is well and septic, no test is furnished.

Many attorneys handling REO sales do not respond at all—to ANYTHING. Not to the attorney approval letter, the inspection requests or requests of any kind. Multiple calls and emails to get any response from them are the norm. (Codilis and Associates and Pierce and Associates, however, do a great job and respond quickly by email.)

Once you get the utilities turned on and do the inspection, most Sellers will not give you credit for repairs. (Some will give you credits, but only a small percentage.) Just recently, one drew a big X through the attorney approval and inspection letter I sent and faxed it back to me.

No survey will be furnished. You have to buy it.

Usually, the Seller buys title insurance for the buyer, but mot always, so be careful

If you are buying a recently foreclosed condo, under a relatively new Illinois law, you, Mr. Buyer, can get stuck with 6 months of the old foreclosed owner’s condo dues. Nice surprise.

One Chicago area attorney who handles REO closings does not attend closing and fed-x’s the deed to closing. Then he will not sign the closing statement until his client approves it. So you need at least two days to close. Forget it if you want to move in at closing!

If you close “late” you pay a penalty of $100/day or so. If you close more than a few days late you may lose all your earnest money.

How to do it right

Be patient. Don’t buy a foreclosure if it will drive you crazy.

Make the contract subject to attorney’s approval. Many do not have this provision.

Make the contract contingent on your professional home inspection (after the utilities are turned on). If the contract does not allow this, I would not buy the house. It’s that simple.

If the property is well and septic, conduct a well and septic test even if you have to pay for it and make the contract contingent on it passing.

If you are buying a foreclosed condo, ask in the 22.1 disclosure form if there are any back dues owed the association and ask under the attorney approval clause for the Seller to pay all condo dues to date of closing.

Good luck (you’ll need it).

6/4/08: The newest trend: Bank/Seller refuses to “de-winterize” (turn the gas, electric and water back on) making it impossible for the Buyer to do a proper home inspection. Or, worse yet, Bank/Seller forces the Buyer to de-winterize the property, at his or her expense, and makes the Buyer sign a rider taking responsibility if the Buyer wrecks anything in the de-winterizing process.

Real estate disclosure by trustee or executor

Living Trusts, Real Estate-Sales, , ,

For the last year, any executor or trustee trying to sell real estate faced a big problem: There were no buyers.

Now, the real estate market has improved a little so there are some sale contracts finally.

A common question is “Do I (the executor or trustee) have to fill out the property disclosure?”

The answer is NO. An executor in a probate estate, or the trustee of a living trust, does not need to complete the real property disclosure. Here it is in writing if you don’t believe me:

(765 ILCS 77/15)
Sec. 15. The provisions of this Act do not apply to the following:

(1) Transfers pursuant to court order, including, but not limited to, transfers ordered by a probate court in administration of an estate

(3) Transfers by a fiduciary in the course of the administration of a decedent's estate, guardianship, conservatorship, or trust.

Can I get a copy of my uncle's will?

Estate Planning

I get quite a few calls from people who suspect they were mentioned (or not) in a relative’s will, and to confirm their suspicion, they want a copy of the will.

In Cook County, the clerk of court’s website has a handy search tool that tells if a will was filed in a probate estate. Click here to search for a will.