Category Archives: Real Estate-Sales

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.

Real estate slowdown

Real Estate-Sales

Here are the unhappy totals for real estate sales for Cook County single-family homes for May 2007 compared to last year:

May 2007     2786 houses sold
May 2006     4690 houses sold

This is a steep drop of almost 50%. The strange thing is that it was already slowing down in May 2006. We don’t see anyone talking about "flipping" houses anymore (or even buying and rehabbing them). The only ones really busy are the foreclosure attorneys.

Real Estate Blues

Real Estate-Sales

The real estate market has been slowing down since the fall of 2005. It seems to me that it’s way more than a slowdown. Business writer Scott Burns, whose column I enjoy, writes that many sellers are becoming "condo slaves," meaning they are stuck with real estate worth less than they paid for it initially.

In Palatine, the market for high end homes is almost nonexistent. There are 62 houses on the market between $600k and $800k and most of them are newly built houses put up after tearing down an older house. Only 2 of these 62 houses have contracts on them. That’s pretty bad. In the $250k to $450k range it’s a little better. About 17 out of 100 homes currently on the market have sold.

I have many clients that have had homes on the market for more than 6 months and cannot sell. It’s more important that ever to buy with a contingency on the sale of your current home. No one wants to be left with 2 houses for a year or more.

The Illinois Deed Providers Controversy

Estate Planning, Real Estate-Purchases, Real Estate-Sales

I get several calls each month from clients saying they got a mailing from Illinois Deed Providers. The client asks: should I buy a copy of my deed for $79 from them? Illinois deed providers obtains a copy of the deed to your property from the county recorder’s office for you. It costs between $2 and $15 to get a copy of the deed, but they charge $79.

It is beneficial to have a copy of the deed, but not for $79. Channel Two News recently did a story on Illinois Deed Providers that said the service was not illegal, which is right, but that it’s misleading. Other bloggers have written about the service too.

Facts on deeds:

1. You get a copy of your deed at closing.

2. It does not mean that you don’t own your house if you don’t have the deed.

3. You can get a copy of Cook Co. deed from 1986 forward at ccrd.info.

4. You can buy a copy at the other county recorders’ offices for the cost stated above.

How to attract a Buyer in a down market

Real Estate-Sales

Most of the buyers at closings for the last few months have not sold their current home yet. Many are close to all-out panic and ask what can be done to attract a buyer.

Some suggest offering a bonus to the selling agent of $1500 or more. But as one thoughtful agent that I know said "That would be great if I (the agent) was buying the house, but I’m not."

Another way to find a buyer is to offer an interest rate "buy down". Most lenders offer these, or you can just credit the buyer at closing and do it yourself.

How it works: Say the buyer would be getting a 6% mortgage for $200,000 to buy your home. You offer to "buy down" the interest rate to 4% for one year and to 5 % for the second year. In this example you would owe the Buyer at closing about $4200 for the  buy-down of the rate.

The monthly payments at these rates are as follows:

4% $954
5% $1073
6% $1199

The math is pretty simple. The Buyer gets a 6%, 30 year fixed rate mortgage. The seller contibutes the amount to buy down the rate each month for the first year to 4% (about $250 per month) and then continues to contribute the amount needed (about $120 per month in year 2) to buy down the rate from 5% to 4% in the second year. After that the Buyer has a 6% rate and is on his or her own.

You either give the buy-down funds to the Buyer directly at closing (or if done through the Buyer’s lender, the funds are placed in a separate account with the Buyer’s lender that is used to subsidize the payment each month for 2 years). Obviously you would have to cap the amount of the mortgage
size and interest rate.

Bottom line: But the bottom line is that the Buyer gets a really low rate for two years and you get your house sold.

Get a Copy of Your Deed Online

Real Estate-Purchases, Real Estate-Sales

Obtaining a copy of the deed to your house was always a cumbersome thing. In Cook County, you can now get a copy of your deed online for about $2. Go to www.ccrd.info You will need the PIN number of your property (from your tax bill). Type in the PIN and the property recording history will appear. Input your credit card and you can download the deed. I use this all the time and it works well, (except for a period of about two months in April and May of 2005 when it didn’t work at all). Now the bugs are worked out and it’s a great convenience.

Selling a Condo-Disclose Special Assessments

Real Estate-Sales

Buyers of condos typically ask for a disclosure statement from the Seller, saying whether there are any special assessments in effect. This only discloses current "approved" special assessments.

What happens if there are no "approved" special assessments, but one is being discusssed, or one is approved after the sale contract is signed?

A recent Illinois appellate case makes it pretty clear that the seller should disclose the "anticipated" assessment to the buyer.

This is a good result: Sellers shoud disclose what they know about the association. The Buyer has no idea what is going on. The seller should disclose everything they know about the finances of the association, including if meetings were held just to talk about special assessments.