As law students, we are trained to identify the legal risks of a given scenario and then advise our clients of those risks. That is the essence of lawyering.
As a transaction lawyer, because we can recognize the potential for misconduct within a transaction, we have a fiduciary duty to protect our client’s interests in the transaction by structuring it in a way to optimally minimize such risks. Our three duties, then, are to:
Identify the nature and scope of any perceived risks that can disrupt the transaction.
Reduce the probability of loss (i.e., transaction costs, opportunity costs, out-of-pocket costs, or sunk costs) from those identifiable risks.
Deflect, to the extent most possible, the costs of inalienable risks.
Put another way, our goals are to protect our client’s interest (identify, reduce, deflect) & facilitate the completion of their desired transactional interest.
Source: Rick Daley, Real Estate Development Law, West Publishing (2011)
If you are an entrepreneur and have the ability to invest in or start a US business, there are two visa options that may be right for you: the EB-5 (Foreign Investor) Visa and the E-2 (Treaty Investor) Visa.
The foreign investor with a capital investment of $500,000 dollars, or more, who is willing to enter a business within a designated TEA (target employment area), which may be either a rural location or an area with a high unemployment rate, may be eligible for the EB-5 Visa.
Q: Does the foreign investor have to manage the business?
A: No. The investor does not need to personally oversee managing the business, and is able to hire a manger to oversee the operation. The investor can also choose to be a limited partner.
Q: Does the investment capital have to be all cash or can it include debt or intangible assets?
A: No. The investment does not have to be all cash. It can include a mix of cash, equipment, goods, other tangible assets (furniture, fixtures, & equipment), cash equivalents, and secured credit lines.
Last week we saw an amazing array of properties and the luscious live-work-play community of Downtown Doral, a city within a city (Miami) in sunny South Florida. In today’s Virtual Tour, we’ll be exploring Downtown Jacksonville & it’s hip, urban lifestyle. Here’s a lineup of the places we’ll see on today’s tour:
Springfield Single Family Residences
The Metropolitan Loft Apartments
The Carling 11 East
The Broooklyn – Riverside
Visit Jacksonville Video Tour
Jacksonville Art Walk
MOSH – Museum of Science & History
The Jacksonville Landing
River City Brewing Company
The Florida Theatre
The Elbow – Bars, Restaurants, & Entertainment Venues
What to Do in Downtown Jacksonville in 2-3 Hours (PDF)
I hope you enjoy today’s presentation and would love to have you back next Saturday at 10 am for our next virtual tour of another South Florida community. Don’t forget to download your guide and have a fantastic 4th of July!
In Florida, home sellers (and their listing agents) are required to disclose any defects that are not readily observable and materially affect the property value. (Ch. 475.2701, F.S.) With that being said, there may be times when certain defects are unknown to the current homeowner.
The home inspection is a major step in the due diligence process of purchasing real property and serves to protect the buyer from expending money on a property that may be worth less than anticipated if material defects later become known. Moreover, oftentimes the lender will require a home inspection and/or a Wood Destroying Organism (WDO) report prior to approving a loan for closing.
Q: What does a home inspector examine?
A: The home inspector will examine the exterior and interior construction of the property, the mechanical and electrical systems, as well as the plumbing system. Below is a list of the common elements observed during a home inspection.
Topography and foundation or crawlspace
Driveway, sidewalk, porch & patio areas
Walls, siding, trim, windows & doors
Garage(s) and/or carport(s)
HVAC and/or wall unit(s)
Plumbing, well/septic system
Other external concerns
Are home inspectors licensed?
A: In the state of Florida, home inspectors are required to be licensed. Check with your state’s division of licensing or ask your local real estate agent.
Use a Seller’s Property Disclosure Statement when you are buying/selling a residential property.
During your walk-through, inquire of any observable defects/recent repairs.
Contact your local government’s permitting department to inquire of any open/closed permits on the subject property. The most important aspect of this step is to ensure that any work done in the past was permitted, up to code, and that all permits are closed. Finding out there is an open permit prior to closing can cause delays and frustrate the closing process, not to mention the potentially high repair costs that may surface.
In closing, it is highly recommended you hire a licensed, insured, and experienced home inspector, ask the seller for a property disclosure statement, and check the property history with your local permitting department. While these tasks may be a bit tedious, your real estate professional should be there to guide you through the process and ensure that you have a smooth closing!
Okay, so I have been experimenting with Canva and I love the capabilities for digital & print media. So far I have only used the graphics online, but you could easily print the pdf’s for, let’s say, open house brochures. Here’s a sample piece I created to market the neighborhood I live in:
As you can see, I introduce three properties within the Town Center development: Esplanade (Condos), 5 Thousand Town (Luxury Apartments), and The Uptown (also Luxury Apartments). The 4th main image is part of the shopping center.
You may note that I also added two pop-out images of the rooftop fire pit and the pool deck touching the 5 Thousand Town image. These are especially useful for highlighting some of your listing’s “special” features that draw in your prospect’s attention.
Well friends, that’s it for today’s lesson. I hope you enjoyed this post and I look forward to seeing you again inside the blog.
This is where offer and acceptance of a purchase price are negotiated between a buyer and a seller, the purchase contract is then signed, and the escrow period begins.
Step Two: Due Diligence
Here, an escrow account is opened to hold the good faith deposit until closing. The due diligence period is a timeframe allowed for the buyer (and the lender) to conduct a reasonable inspection of the subject property to ensure that it is in marketable condition. This is done by ordering a home inspection, a property appraisal, title search, and a land survey. If financing is involved in the purchase transaction, the lender will begin the loan qualification process concurrently during this period and will issue a “clear to close” when all of the supporting materials for the buyer’s (mortgagor) loan file have been collected and verified. Meanwhile, the title company will work with the lender to prepare all of the necessary transfer docs: warranty deed, mortgage, promissory note, and escrow instructions (payoff instructions for the seller’s existing mortgage, if applicable) and other closing costs.
Step Three: The Closing
Making it to the closing table is an exciting time for most home buyers. The contract is fully executed, loan funds are disbursed (usually by wire transfer from the lender), the buyer pays the remainder of the purchase price and other closing costs as necessary, illustrated on the Hud-1 settlement statement, and the seller tenders clean title (and the keys) to the new homeowner. Congratulations!
4 Common Legal Problems That May Arise Prior to Closing
Statute of Frauds
The SOF traces back to the original English Statute of Frauds of 1677. It requires certain types of contracts, such as contracts for the sale of land, to meet 3 requirements:
Terms of the Contract (Parties, Price, and Property Description).
The Contract Must be In Writing (whether it be a formal contract or an informal note handwritten on a napkin).
Signature (the contract must be signed by the party accepting the offer – the “offeree”).
Almost every contract for the sale of real property, unless the contract specifically expresses otherwise, includes either an express or implied promise that the seller will deliver a merchantable (marketable) title. That is to say that the title will be valid and free of any clouds (encumbrances).
Two Types of Unmarketable Title:
(a) Less than Fee Simple Ownership (ex: seller has a life estate);
(b) Encumbrances on the Title (ex: lot is subject to a “right of way” easement).
During the executory period (the time between the contract signing and the closing) the buyer is seen as the equitable owner of the property once the contract is signed. As such, the buyer bears the risk of loss should the property be damaged or destroyed.
In order to minimize such risk, the buyer may request a provision in the contract that specified the owner bears the risk of loss should the property be damaged or destroyed prior to closing. (This makes the most sense as the seller typically has property insurance coverage already in place.
Another alternative is for the buyer to purchase an insurance policy on the subject property during the executory/escrow period. Generally speaking, the liability runs with the land. In other words, whomever is living in the home usually takes liability of loss or damage.
Seller’s Duty to Disclose
Most jurisdictions require the seller of residential real estate to disclose all known defects that:
(a) materially affect the property value; and/or
(b) are unknown to the buyer and are NOT readily observable by a reasonable buyer.
Describing Real Property
There are 3 Principal Types of Property Descriptions Used in the Continental United States.
Subdivision Map: Lot & Block Parcel #’s are recorded in public records.
Metes & Bounds: Descriptions are based on topographic features.
Government Survey: Public Land Survey System or PLSS (Section, Township, and Range)