Articles Posted in Real Estate Hints and Help

Did you know that there is a way to avoid mortgage taxes that increase the cost of re-finances? The technique known as a “consolidation, modification and extension agreement” (CEMA), and helps a refinancer to pay only the cost of the “new money” being borrowed.

To accomplish a CEMA, the borrower, the borrower’s attorney, and the lender prepare new documents which consolidate the old mortgage with the new mortgage. In the process, the old mortgage is assigned to the new lender, and the borrower pays mortgage tax on the “new money.” The original mortgage is not “discharged of record,” because the borrower arranges to keep the existing mortgage on the books and then assigns it to the new lender.

The new lender requires a new mortgage for the closing costs and new money, while the new lender and the old lender execute an agreement assigning the old mortgage to the new lender; and all of the debt is consolidated.

A “closing” is a “closing.” When people say they are going to their real estate closing, they are talking about accepting their most expensive investment, fleas and all. If you have a problem with the home before the closing, you should bring it up before the closing, otherwise you are fore-closed from complaining.

This is illustrated by a recent case where the contract of sale provided that the property “will be delivered vacant and clean” at closing. The Seller failed to deliver the property clean, and the Purchaser had to spend $17,000 to remove storage bins, a container and other items, which should have been removed at closing.

To recover his costs, the Purchaser commenced action claiming that the contract required the Seller to deliver the property clean. The Supreme Court, Queens County, did not immediately dismiss the contract claim, but the appeals court (Second Department) reversed and dismissed the contract cause of action. Under the law of New York, the seller’s obligation to deliver the premises “vacant and clean” did not survive the closing of title because it was “merged” in the deed. By accepting the deed, the purchaser forfeited his right to enforce the contract provision–an elementary rule of law. The collateral obligation to deliver the property clean was “extraneous” to the sale of real estate and did not “survive” the delivery of title. Novelty Crystal Corp. v. PSA International Partners, L.P., decided January 15, 2008, is reported at 2008 WL 141502.

Well, that really depends upon where your “stoop” is sitatuated and whether the police officer thinks you have an open container.

In Brooklyn New York a Prospect Heights man was issued a ticket for drinking beer on his front “stoop,” which was several feet from the public sidewalk and not enclosed by a fence. The man was checking his email and drinking a beer at 11:52 pm when a police officer drove up and handed him a summons for drinking in public.

The issue for the court will be whether the “stoop” in front of his four (4) story, twenty (20) unit cooperative building is “public” or “private” property? The man stated that he and his fellow apartment dwellers had been doing this for years without incident, but that’s for the court to decide.

Are you looking to purchase real estate in New York? Whether the real estate is your first house in Westchester, your vacation property in Dutchess, or your flat in Brooklyn, one common question that arises is how should you take ownership, especially if you are buying with your spouse, your life partner, or just your “friend.” There are many different forms and types of ownership, but they all start with what’s called ownership in what’s called “fee simple absolute.”

Fee Simple

When you own real estate outright, holding and controlling the entire bundle of sticks, we call it owning it in “fee simple absolute.” That is, as the title holder you, as the individual have the full absolute possessory right to the property, now and in the future, for an infinite duration, with no limitations on its inheritability (right to be transferred to others through death). The holder of the real estate owns entire estate (or bundle of sticks), and has the absolute and unfettered legal right to dispose of it without permission or consent by anyone else.