Am I required to have an escrow account for my taxes and insurance with my mortgage payment?

That is a decision or a requirement that your lender will make whenever you apply for the loan. The usual case is if you’re getting a conventional loan and the loan – the value – meaning you’re only borrowing 80 percent or less of the value of the appraised value of the property, the lender may agree to let you pay your own taxes and insurance separately.

If however you’re getting an FHA loan or a VA loan or a high percentage loan meaning that you’re borrowing more than 80 percent of the appraised value, the lender is going to require you to escrow for taxes and insurance as well as possibly pay mortgage insurance each month, but that is something that you need to discuss with the lender when you make application for a mortgage as to whether or not the lender will allow you to pay your own taxes and insurance.

There’s another caveat to that is if you have that agreement with the loan originator, if they sell the loan to another servicer or another bank to accept your payments, the mortgage does provide that the successor lender can require you to pay or escrow for taxes and insurance which certainly wouldn’t make you very happy, but you do need to be aware that it is in the mortgage documents that it’s up to the lender to decide whether or not you have to escrow for taxes and insurance.

So, the answer to the question is: it’s up to your lender as whether or not you’ve got to have escrow for taxes and insurance with your mortgage payment.

If you have any questions, well give me a call at 727-847-2288.

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Can a buyer sue a seller for a undisclosed roof leak?

The answer is: yes, they can. This dates back to a Florida Supreme Court case called Johnson vs. Davis. That decision is probably 20 years old or older wherein they held that any residential transaction that the seller has the duty to disclose to the buyer any matters that are not reasonably observable to the buyer that may have some impact on the value of the property.

So, as a result of that, the standard real estate contract that is used by realtors that’s been approved by the Florida Realtors and the Florida Bar Association has a clause in it that says that the seller has disclosed any matters that may material affect the value of the property that are not readily observable.

Further, if you use a realtor they have a seller disclosure form wherein they go through a series of about four or five pages asking the seller to initial one way or the other whether there’s been any problems.

So, if you didn’t have that in the contract and you simply used a contract that did not have a disclosure or an as is contract, the seller still has the duty to disclose any matters that are not readily observable that may have some impact on the value of the property.

If a buyer’s going to sue the seller then they must review the disclosures to see if the seller did in fact disclose the roof leak or any other leak.

Secondly, the buyer must prove that the seller knew of the roof leak because you’d have to show that it occurred or was a roof leak prior to the purchase rather than occurring later. There have been some cases whenever people weren’t aware of a particular defect – of course it’s a little harder as far a roof leak’s concerned, but as far as any defect is concerned that they’re aware of it.

Many times if you buy bank owned property the bank will put on there that they have no responsibility because they’ve never been in possession of the property and therefore are unaware of any defects and so you could not sue a seller that is not aware of these problems.

A roof leak usually is manifest by showing something on the interior where the ceiling has been discolored and you can show where the seller has painted over it or has had roofers or somebody else over there trying to fix it and so that you could show that they were aware that the roof was leaking and they failed to disclose it.

If they fill out the form that the realtor gives them and says that they haven’t had any prior roof leaks or any other problems with the property, that’s an affirmative fraud and that is another cause of action so that you can sue the seller on two different theories as far as failure to disclose a hidden defect that’s called a latent defect – either sue under the contract if it’s provided for in the standard bar contract or the realtor bar contract or as a in toward or liability.

It’s a form of fraud by not disclosing this matter and so the other aspect of this before you get ready to sue the seller, you need to see who the seller is. If you happened to have bought this property from an investor or an LLC, well you may be able to sue them, but you have to show they knew about it, covered it up and didn’t disclose it and also, can you get any money back out of it?

So, you have two remedies. One is to ask to rescind the transaction, meaning you give them back the property and you get your money back if you were would not have bought it if you were aware of it. The other one is to sue for damages to determine or you show how much it cost to fix the defect.

So, an answer to your question is: yes, you can sue – a buyer can sue a seller for a roof leak if they can show the seller was aware of it and the roof leak occurred prior to them purchasing the property.

If you have any questions about this, well give me a call at 727-847-2288.