Video Summary

Should you buy a foreclosure home? Well, homes that have been foreclosed upon are usually held by a bank. Well, you may want to buy it because the price is right; because with this real estate market, there’s a lot of bank-owned property. One of the problems with buying bank-owned property is the addendums they put on contracts. The contracts exclude the bank from any liability as far as the condition of the home, particularly if it had any particular latent or hidden defects. Of course, the big one is sinkholes.

You would need to do a very thorough job of having the property inspected to make sure it was not a prior sinkhole home. If it was, it’s almost impossible to get these engineer’s reports to determine whether or not it was repaired properly. And that will impair your ability to insure it, where if it was an unrepaired sinkhole home, you’re not going to be able to get insurance on the property, or you won’t have coverage even if you do. The insurance company may decline coverage. There’s any other number of other problems in buying these – physical problems with the property.

It would be to your benefit to hire an inspector to thoroughly inspect the property, make sure there are no sinkholes, make sure everything’s in working order –especially the roof– so you know what you’re buying and you don’t wind up buying a pig in a poke. You also need to look at the title and keep in mind that these contracts, or the addendums they put on bank-owned property, say that the bank can get out of the contract for any particular reason, and so it’s problematic. You don’t have absolute certainty, particularly if they discover that they’ve got some title problems. Well, they’ll say, “I’m sorry. I can’t close because we found that we didn’t do the foreclosure right,” or whatever, and they cancel your contract, which makes it very frustrating.

So, those are some of the pitfalls or things that you need to look out for if you’re going to buy foreclosed property, particularly from a bank, which is usually who you’re buying it from. The addendums are almost as long as the contract and they just exclude the bank from any liability as to any problems with the property, and you have no recourse. So, the advantages are that you usually get a super-good deal. The downside is, you’ve really got to do your homework and investigate the property, and also investigate the title to make sure they’re not going to back out at the last minute and that all the liens are cleared up.

Another big pitfall, particularly in this area, is unpaid utility bills. Many times, the utility company has a lien against the property, particularly in the Gulf Harbors, which was formerly Lindrick, or the Aloha district, which is now Florida Government Utility Association, and they will not give you utility service unless you pay the past-due utility bill. So, you need to look out for that. If you’re buying property in a Homeowners Association, you need to check and make sure that there are no past-due Homeowners Association dues or Condominium Association dues if you’re buying from a bank-owned or foreclosed property. If you’d like representation concerning a purchase of foreclosed property, give me a call at (727) 847-2288 and I’ll be happy to represent you. Thank you.

Video Summary

An amortization schedule shows how much of the payments are principal and how much are interest. You usually receive an amortization schedule when you sign a promissory note and it’s usually connected with a mortgage. Each payment remains the same and is paid at the same time, usually monthly, as far as your monthly payments are concerned. The initial payments on a regular payment schedule include a whole lot more interest in their first payment than on their latter payments. For example, if you have a $100,000 promissory note and the interest rate is 6% and you want to pay this over a period of 30 years, the payments are $599.56 a month. The first payments are going to be all interest and then the last payments are almost all principal. So that’s the definition of an amortization schedule, where you have a constant payment which is payable usually monthly and can be annually, quarterly, or whatever but you have a regular periodic interval and it’s the same amount every month. And the schedule will show how much of the payment is interest and how much is principal and it assumes that you make the payment on the due date every month.  So if you have any questions about an amortization schedule or about owner financing, which is usually when we produce these, give us a call at (727) 847-2288. Thank you.

Video Summary

Land contracts are not used in the State of Florida. A Land Contract is written in such a way that if the buyer of a property fails to pay, the contract is terminated and the sale is ended. This eliminates the need for the foreclosure process. Florida, however, is a Judicial Foreclosure state so land contracts cannot be used.

Video Summary

A lease is a landlord-tenant relationship wherein the tenant takes occupancy of the property and agrees to pay a designated monthly amount for a set period of time. In the case of a lease with option purchase, the seller agrees to sell the property to the buyer for a fixed purchase price during the term of the lease. Generally, a certain amount of the monthly rental payments can be applied toward the purchase price. The “option” refers to the buyer’s right to choose whether to purchase the property.

The advantage of a lease with option to purchase is that if the tenant fails to make payments, the buyer may pursue the eviction process rather than the foreclosure process, which takes much less time. In the case of owner financing, a lease with option to purchase is advisable if the buyer does not have a substantial amount of money for a down payment.

If you’re interested in arranging for owner financing as the buyer or seller of a property, please give us a call at (727) 847-2288.

Video Summary

An agreement for deed is a form of owner financing wherein the seller retains the title to the property and allows the buyer to take possession of the property. The seller provides equitable title, which means that the buyer has all the legal rights to the property except for legal title, which is held by the seller for the purposes of securing payment. However, Florida law treats an agreement for deed the same as a Note in Mortgage. Our law office generally does not use agreements for deed because there is no particular advantage over a Note in Mortgage.

If you have any questions about buying or selling a house, agreements for deed, notes in mortgage, or other related matters, please give us a call at (727) 847-2288.