What Should I Be Aware of When Financing the Sale of My Home?
Video Summary
I am considering financing the sale of my home. What should I be aware of? Under Florida, you’re required to – when you sell your home you can take back a note in mortgage. And you cannot take back a land contract as they have in other states, because Florida is a judicial foreclosure state that requires notes and mortgages, land contracts, agreements for deed, to be foreclosed upon. So, the first thing you need to understand is, what’s the remedy in the event the person fails to make the payment?
The foreclosure process and the cost of going through a foreclosure is in the neighborhood of $3500.00 to $5000.00 with the filing fees and the court costs, and that’s if the matter is uncontested. The time period to go through the foreclosure process is estimated to be about nine months, if it is not contested. So, that should be a major consideration. I do not suggest that you do owner financing unless you get at least 20 percent of the money down. So, if you’re selling the property for $100,000.00, you would need to have a minimum of $20,000.00.
If you’re selling property that is of lesser value, you need to be aware of the cost involved as far as foreclosure and the time period, because you won’t be getting any money. Also, you would have to pay back due taxes if you foreclosed and took the property back, and it’s very hard to protect your property from vandalism or malicious conduct by the borrower if you start foreclosure. So, all these should be considered as to how much of a down payment you should receive before you consider doing the owner financing. I’d be happy to talk to you about what kind of interest rate you should be able to receive, and as far as owner financing is concerned. You cannot circumvent the foreclosure process by escrow and deeds. You cannot do land contracts and not record them and simply tear them up and have the people removed, since Florida is a judicial foreclosure state.
So, if you’d like to explore owner financing, give me a call at 727-847-2288.
- Published in Real Estate, Videos
Why Do I Need A Notice of Commencement?
Video Summary
Why do I need a notice of commencement? Well, in order to be able to pull a building permit you need to file a notice of commencement with the building permit. And the building department will not issue a building permit without a notice of commencement. So, that is a good safeguard whenever you’re having someone do some work on your home, is to inquire as to whether or not they’re a licensed contractor, and if they’re going to pull a building permit. And if they are, well then you’re going to have to sign for the notice of commencement. You need to be very wary if they are not going to pull a building permit to make sure that they are a licensed contractor, and you have all sorts of problems if you don’t as far as unlicensed contractors doing work.
The notice of commencement is one of the first steps that the owner is obligated to do – to file under the construction lien statute, which gives anyone that is furnishing material or labor notice as to who the owner is, and where to send their notice to owner. And so, if you would receive a notice that someone is supplying materials, you need to ask your contractor to give you a waiver from that particular person whose supplying materials or labor. Also, whenever the contractor is finished, and if you haven’t received any notices to owner, the proper document to ask for from your contractor is a contractor’s final affidavit stating that they have been paid in full and that there are no outstanding unpaid suppliers. So, if you are going to be doing work on your home, you need to be sure that you deal with a licensed contractor; that he pulls a building permit; and that as you pay him, you get progress payment affidavits and make sure that there are no unpaid material amounts or suppliers. And before you give him the final check, you need to have him sign a contractor’s final affidavit to protect you against any unpaid contractors, since it’s a crime to sign this affidavit and you can rely upon it by the contractor.
So, if you have any questions about dealing with your contractor, please give me a call at 727-847-2288. Thank you.
- Published in Real Estate, Videos
What Do You Mean By Corporate Minutes?
Video Summary
What do you mean by corporate minutes? Each year, a corporation should have a shareholder’s meeting. And the purpose of the shareholder’s meeting is to elect the directors of the corporation. So, that should be one meeting. And not all shareholders are necessarily directors, although in most small corporations the shareholders do serve as directors and officers. But you need to have separate meeting minutes for the shareholders, and their purpose is to elect the directors.
The other corporate minutes are director’s minutes. In the director’s minutes, the directors will elect the officers of the corporation; that’s the function of the directors rather than the shareholders, so you have separate minutes. And so, the directors elect the officers, and also set forth any particular corporate loans, or anything out of the ordinary, particularly if there’s been shareholder’s loans, or if you’ve loaned money to shareholders or the shareholders have lent money. Then, they need to authorize the loans in the director’s minutes to the president of the corporation. So, you need to have two sets of minutes; one for shareholders, and one for directors.
If you’d like an information sheet and assistance in preparing your corporate minutes, whether they be shareholders or directors or both, and/or filing your annual report, give me a call at 727-847-2288. Thank you.
- Published in LLC's and Corporations, Videos
Does a Designated Trustee Need to Hire a Lawyer?
Video Summary
Hi! I’m Chip Waller. Does a designated trustee need to hire a lawyer to administer a Trust?
Usually the designated trustee is a successor to a decedent. So the answer is, I suggest that you contact an attorney, like me, and find out what your duties and responsibilities are as a successor trustee as well as can you be held liable if you don’t follow the Florida statute for the Florida Trust Code.
Some of the things that you need to do as a successor trustee is obtain a Federal Identification Number because you’re dealing with monies that are not yours, and you don’t want to have to report any income under your Social Security number because it’s not your money or your income. And you need to file what they call a Fiduciary Tax Return, a 1041.
Next as a successor trustee you’re required to send a copy of the Trust to all the beneficiaries. And that’s sometimes not what anybody wants to know about, but particularly if there’s a distribution or if you’re supposed to pay income for life to someone. But everyone who is a beneficiary under the Trust is to get a copy of the Trust document.
You also usually have many questions about, well, should I pay all the creditors? Well, and now can I – when can I distribute all this money and not be responsible for the creditors’ claims? That’s usually a fairly tough question.
And one of the other responsibilities that you have, and potential liability for, is doing an accounting. So you initially have to prepare an inventory and send out, to all the beneficiaries, an inventory of all the assets.
Once they get that, well then they’re entitled to an annual accounting which sets forth how much income and what transaction took place. And if you fail to do that, you have liability for many, many, many years to come and have potential liability.
So, as my recommendation, that before – if you’re designated as a trustee of a Trust, that you consult with an attorney to find out what your duties, responsibilities and liabilities are as far as serving as a successor trustee, and decide if you want to undertake those responsibilities and potential liability.
If you have any questions give me a call at 727-847-2288. Thank you!
If I Inherit Money, Do I Have to Pay Tax on the Money?
Video Summary
Hi! I’m Chip Waller. The question is, do I have to pay inheritance tax on any money that I receive from an estate?
The answer is no. Estate taxes are paid by the estate, so you may be paying them indirectly because it may reduce the amount of the monies that you received as a result of paying an estate tax.
I am not aware, although cannot say conclusively, as to having no inheritance tax in any state. But in Florida there is no inheritance tax and, also, there are no estate taxes. So as far as I know that, well, in fact, there are no inheritance taxes if you live here in Florida that you have to pay.
So if you have any more questions about taxes and estates, well, give me a call at 727-847-2288.
Thank you!