How To Buy Real Estate in Mexico
Buying Property In Mexico
Buying property in Mexico has become more popular every year. Whether you would like to purchase a vacation home or are planning on retiring there, owning real estate in Mexico is easy and safe. With its incredible natural resources, rapidly improving economy and modern facilities and infrastructure, Mexico is the place to make your dream home a reality.
Working With Professionals.
Who better than the Costa Realty team to serve as your Real Estate Agents and Advisors when looking to buy property in Mexico? With decades of experience representing residential and commercial clients on both sides of the border, our expertise provides you with the knowledge and security that you need when deciding to invest.
Financing.
With the increase of American investors in Mexico there is a greater availability of mortgage financing for American buyers. With long term financing you tie up less capital and enjoy the same high returns that the Mexican market offers. Also, more and more Mexican banks are offering mortgage opportunities to Americans buying real estate there. We can recommend a number of options to fit your needs
Frequently Asked Questions.
Can Foreigners own property on the beach in Mexico?
Mexican law permits foreign ownership of real estate on or near the beach through a Mexican Bank Trust or \”Fideicomiso\”. All land within 30 miles of the Mexican coast and 60 miles of a national border is regulated through the use of a Bank Trust for foreign investors. Mexican banks are the only institutions that can hold Trust of the deed for foreign buyers.
What is a Mexican Bank Trust?
The Mexican Government issues a permit to the Mexican Bank of your choice allowing the bank to hold title to the property and the purchaser holds title to the beneficiary rights (almost all Mexican Banks are owned or in partnership with American or European Banks). The bank acts as the Trustee and you are the Beneficiary of the Trust. The Trustee only takes instructions from the Beneficiary or foreign purchaser.
What rights and obligations does the Beneficiary receive?
It gives you all the rights of ownership such as the right to occupy, use, sell, rent and build on or improve the property. You may also mortgage the real estate and instruct the Bank to transfer title to another person or corporation. You will be obliged to pay property taxes, utilities and condominium maintenance fees if applicable, and the Trustee’s annual fee which varies from bank to bank.
What happens to the trust if I sell my property?
Upon the sale of property held under a Trust, the Secretary of Foreign Relations is required by law to issue a new Trust permit to the buyer or if the property is sold to a Mexican, the Trust can be terminated and it can be owned directly.
What is the duration of a Trust?
The initial term of the Trust is 50 years. It is renewable for an additional period of 50 years within the last year of each 50 year period and this can be continued indefinitely.
What happens if the Beneficiary should die during the legal period of the Mexican Trust?
The Beneficiary has the right to appoint a substitute beneficiary (ies) who will receive all the rights and obligations that arise from the Trust if the Beneficiary should die. Your heirs will not need to follow any probate proceeding before the Mexican courts. They would only have to give notice to the Bank/Trustee and show the death certificate and their identifications. The Bank will register them as the new Beneficiaries of the Trust without any cost.
What requirements are necessary to open a Trust?
Our professional agents will be by your side to guide you along the way; however these are the basic requirements:
1. Copy of your photo ID, birth and marriage certificates, Visa or Tourist Permit
2. Your address, occupation, phone number and e-mail address
3. Name, nationality, address and phone number of the substitute Beneficiary(ies) in case of death
4. Copy of the current Real Estate deed and free of lien certificate (given by the seller)
5. The agreed purchase price
What expenses are involved?
The total expense of opening a Trust is between 5% and 6% of the sale price. This includes the following: the initial fee to set up the Trust, obtaining the permit from the Foreign Affairs Ministry, recording of the Trust Deed at the National Registry of Foreign Investments, the bank appraisal fee, and the first annual fee for handling and servicing the Trust.
How long does it take to obtain a Trust?
The Public Notary takes care of the entire procedure and on average we can obtain your Trust within 30 to 60 days.
What is the function of the Public Notary?
In Mexico a Public Notary is quite different than in the U.S. They are lawyers appointed by the State Government and are the only attorneys authorized to validate the title transfer process. The resulting document is registered at the Public Registry of Properties.
Can I get U.S. Title Insurance for Mexican property?
To provide full security to real estate transactions, Costa Realty recommends the services of Stewart Title. From Title Insurance, Escrow, Closing Coordination to Mortgage Services, Stewart Title assists real estate agents, buyers, sellers and lenders in closing real estate transactions with peace of mind.
The Process
There are many beautiful places in Mexico boasting much lower real estate prices than can be found in the U.S. and Costa Realty has a wide range of great investment opportunities in some of Mexico’s most amazing coastal resorts.
Book a trip
Take time to get to know the area and ask the pertinent questions. Nothing compares to being there. We can be of great help getting you there and in arranging your personalized real estate tour.
Find the right advisor
Costa Realty has the professionals with all the right answers and years of experience showcasing and selling properties in Mexico.
Make an offer
Your proposal is important and we’re here to get you the very best deal. Our goal is to achieve the best terms and prices possible for your real estate transaction.
Closing the transaction
We will make sure that all the necessary documents for your new property are presented to the Public Notary and that they are validated and legal.
About The Author:
Written by: Fernanda Rodriguez. At Costa Realty, they are committed to helping you to realize your dream of owning a property in any of the fabulous Mexican beach resort destinations they serve. Owning a Mexican waterfront property is the best Real Estate investment in the market, see for yourself! http://www.mexicocostarealty.com/
Read more of Fernanda Rodriguez’s articles.
Tips About Vacation Villas In Chianti, Tuscany
Travelers who enjoy wine, food, beautiful scenery and a relaxed pace will love Chianti. Not only is the region home to its namesake wine which is one of the most beloved and popular wines in the world, but it is also home to some of the most characteristic farmhouses and villas in Tuscany.
The combination of incredible wine, food and vistas make Chianti one of the most idyllic places to take a vacation. Finding a holiday villa in Chianti is not difficult, and traveling slowly around the region will send you back home as a new person.
The region is obviously very famous for its wine. Chianti is one of the most popular wines in the world. So for those that are seasoned wine lovers it is a paradise. A Chianti farmhouse with a pool is not only the perfect base to go on wine tours from, but it is also a fantastic way to take the edge off of warm summer nights. What could be more enjoyable than relaxing around a pool sipping the tasty wines bought on wine tours?
Food in Tuscany is amazing. And agritourism attracts foodies and gourmands in droves. Settling into a vacation villa with a pool, Chianti laid out before you to explore and then beginning your tours of the region is amazing.
Whether you are viewing farms and livestock or are more focused on the many restaurants that serve up traditional Tuscan fare, returning to your holiday villa in Chianti satiated on bistecca, fagioli and every other offering will be sure to but a smile on your face.
Scenery in Chianti is worthy of every postcard you have ever seen. The vistas from hilltops, vineyards and even the terrazza of a vacation villa with a pool in Chianti will take your breath away. Slowly rolling hills that are green year round and boast vineyards and olive groves galore are dotted with villages and farms. Characteristic cypress trees outline many of the hills and guide the eye along roads and driveways.
The typically Mediterranean climate makes renting a Chianti farmhouse with a pool an ideal solution for lodging. The long, lazy summer days, and fresh spring and autumn days mean that time by the pool in Chianti is a three season option. Dinner in April under an umbrella while gazing at the hillsides, refreshing dips after hot summer days or an open bottle of wine on the terraza while watching the October sun slide down behind the hills.
Chianti is a region that can relax and soothe even the most weary traveler. A wine novice can emerge from the region with a new found love for the Sangiovese grape. The budding chef will return with ideas for recreating dishes at home.
The naturalist will have time in stunningly beautiful sparsely populated hills. The photographer will come home with too many wonderful photos to be able to choose the best. With the setting of the region, all it has to offer and its proximity to everything in Tuscany, Chianti is an ideal location for a relaxing vacation.
About The Author:
Specialized in marketing and communication, Teresa Cambi is expert consultant for several real estate agencies. She also collaborates with many online tourist guides, writing articles about the most popular travel destination in Italy. She currently works as press officer for http://www.castellodibibione.com/ a beautiful holiday villa in Chianti with swimming pool and wellness centre.
Read more of Teresa Cambi’s articles.
Find The Right Property For Sale In Tuscany
Those that have spent any significant amount of time in Tuscany know the draw that the region has. Anyone that has been a student in Florence or has soaked up the agritourism side of the most famous region of Italy understands the desire to return. The desire may be for an annual vacation, a farm holiday in Cortona with your family during the harvest season long enough to attend the annual truffle festivals.
The Tuscan countryside may have infected you with so much appreciation and inspiration that you may want to relocate or retire to your own villa with your own olive trees and vines. Whatever motivates the urge to live \”la bella vita,\” and find your own perfect Tuscan villa for sale; there are a few things that can help you along the way.
All the basics as far as real estate are essentially the same. If you are buying a condo in Miami or a property in the rolling hills of Tuscany you follow the same road. The road just meanders a little bit more when you deal with purchasing a house in Italy rather than the US.
The first step in attaining your dream is the same as purchasing in the US, find your agent. Just as in the US, real estate agents focus on certain areas or certain niche markets. There are actually a good number of agents and agencies that specialize in finding and selling properties to non-Italian citizens.
Unless you not only speak fluent Italian, but are familiar with the convoluted Italian legal system, it is best to choose one of these agents. You don’t want to be in a position where you think you have found the perfect Italian villa in Tuscany only to find out that the owner doesn’t want to sell to you or the improvements you envisioned won’t be permitted.
Time is an additional factor to consider. Communication will generally be just a touch slower because of the time difference. But if you always send emails or make phone calls in the morning it will facilitate everything and you will be that much closer to spending long, slow relaxing farmhouse in Cortona, dining al fresco.
You should allow a little more time for escrow than you would in the US, unless your agent has found a villa that is unoccupied. Another clarification you will want to make is whether the homes you are considering are furnished or unfurnished. If you have a strong preference, there are actually a lot of furnished homes for sale in comparison to the US; and if you are searching for the perfect house as a vacation home this is a great option.
Be aware that when a property in Italy is unfurnished in many cases that includes not being furnished with appliances and fixtures, even in the bathrooms and kitchens. If you take your time, work closely with your agent and make sure that you all of your desires for either a permanent vacation home or relocation to the land of Chianti and scenic vine covered hills are clear; then you will arrive in Tuscany with a smile that will only widen with time.
About The Author:
Alice Migliorini is specialized on selling prestigious properties and she is one of the real estate agents working for http://www.intermediacortona.com , a real estate agency based in Cortona (Tuscany). Alice deals with Tuscan villas for sale and farmhouses for sale in Tuscany: Cortona, Arezzo, Lucca, Montepulciano, and many other Tuscan cities and towns. Learn more at: http://www.intermediacortona.com/home_en.asp
Read more of Alice Migliorini’s articles.
Sarasota Florida: Top Ten Reasons to Visit in 2009
An abundance of visitors from around the world visit Sarasota each year to enjoy all of the amenities this small city on the Gulf Coast of Florida has to offer. Each year, Sarasota’s warm climate attracts \”snowbirds\” down to the Sunshine State for its high season from January through March. Visitors and residents alike enjoy the city’s internationally recognized cultural amenities matching those of the nation’s largest cities. A world-class destination, Sarasota, Florida has many reasons to live, work and play in this gorgeous coastal setting.
1. Cultural and Entertainment Venues
The downtown Sarasota area known as the cultural district offers a busier, cosmopolitan atmosphere for residents and visitors. The Van Wezel Performing Arts Hall provides outstanding entertainment each year with its full-calendar of performances. Active adults or young families often attend the world- renown Ringling Museum, the resplendent Selby Gardens, Sarasota Jungle Gardens, Mote Marine, G-Wiz (hands-on Science museum for kids), as well as the historic Asolo Theater. Sarasota even has its own Ballet, Opera and Symphony. It is no wonder Sarasota is often referred to as the \”Cultural Coast of Florida.\”
2. Sarasota’s Barrier Islands and Beaches
Sarasota is home to four tropical barrier islands, each with its own unique personality. Siesta, Key, Longboat Key and Lido Key contain miles of beautiful beaches lined with luxury resort-style condominiums, quaint cottages and inns, numerous hotels, and extravagant estates. There are no high-rise condos on the ultra-exclusive Casey Key. This barrier island is comprised almost entirely of single family homes. Private and public beaches are available on all of the keys for residents and visitors who love the water.
3. Sarasota’s Weather
There are so many reasons to visit Sarasota Florida. The near-perfect Sarasota weather is at the top of many people’s list. Sarasota’s average year round temperature is usually around 74 degrees F. Visitors have plenty of sunshine and warm weather throughout the year. Although summers can be quite hot, cool breezes from the Gulf of Mexico are a refreshing relief from the summer heat.
4. Water, Water, Water
So many people come to Sarasota to enjoy the water. With 35 miles of pristine beaches, the Intercoastal waterway and many miles of boatable canals, Sarasota has waterfront options for everyone. Siesta Key Florida Beach was just named the 2nd best beach in the United States for 2009 by Dr Beach. Boating enthusiast enjoy everything from fishing to leisure rides in the Gulf and Bay. If you love the water, Sarasota has it all waiting for you.
5. Location
Sarasota is perfectly located 60 miles south of Tampa. Direct flights from major cities around the world arrive at Tampa International Airport. Sarasota International Airport has direct flights from select major cities as well. Disney World is only about 2 hours from Sarasota and often visited by adults and children. Major sporting events, entertainment venues and Busch Gardens are all within and hour.
6. Outdoor Activities
Residents and visitors of Sarasota enjoy championship golf, sailing, boating, tennis, swimming, nature trails, canoeing and kayaking as well as beachcombing, shell collecting. Outdoor activities are endless in this coastal city. Downtown Sarasota’s Farmers Market is a popular attraction each Sunday.
7. Shopping
You can shop till you drop! Sarasota has it all. Famous St. Armands Circle, similar to Wirth Avenue in Palm Beach, is the place to see and be seen. Specialty shops provide high-end arts, gifts, jewelry, clothes and sea shells. Visit a caf
Longboat Key Florida: How to Make the Most of Your Visit
Longboat Key Florida is an 11-mile long island that borders the Gulf of Mexico to its west and the calm waters of Sarasota Bay on to its east. The 8,000 permanent residents of Longboat Key live in a variety of residential styles from condominiums, townhouses, small single-family homes to luxury waterfront estates. While providing activities such as beachcombing, walking, swimming and fishing, the Key is manicured and secluded allowing a relaxing lifestyle. Longboat Key is known throughout the world for its outstanding beaches, sweeping water views, excellent dining, great weather, luxury lifestyles and don’t forget the sensational sunsets.
Things to Do on Longboat Key
As a national and international tourist destination, Longboat Key, with its fabulous weather and waterfront opportunities creates a perfect environment for travelers and residents alike. Local activities, such as boating, fishing, jet skiing, golf, tennis, shopping, fine dining, and arts/culture venues are available year round.
The Longboat Key Club and Resort
Behind the gates of the prestigious Longboat Key Club and Resort, tourists as well as Club members take part in fabulous amenities:
Longboat Key’s Perfect Location
Longboat Key is only a short drive away to world-famous St. Armand’s Circle. Vacationers and tourist are privy to world-class shopping, fine dining, cultural activities and more. Mainland Sarasota is also only a short drive from Longboat Key and the Circle too. Sarasota has previously been named the \”Best Small City in America by Money Magazine.
Longboat Key Real Estate
Architectural styles on Longboat Key range from high-rise condos to tiny beach homes on winding canals leading to the open water of Sarasota Bay. A full-time Realtor experienced in showing properties regularly on Longboat Key can assist any buyer in their search for an island home. Longboat Key is often searched by national and international home buyers who are searching for a home or condo within their real estate parameters. Lifestyle is important to these buyers and luxury accommodations are at the top of their list of wants.
A Longboat Key condo on the beach is perfect for out of state owners seeking maintenance-free living. Other discriminating home buyers may prefer a secluded estate with access to the Sarasota Bay and Gulf of Mexico. Golf course properties are available to those buyers who want to live right on the fairways. Longboat Key has a variety of lifestyle options for almost every budget.
Longboat Key real estate options include luxury and waterfront homes or maintenance free townhomes, villas and condos for the vacation home buyer. Condos on Longboat Key are perfect for second homes, retreats and full-time residences. This Sarasota barrier island is a wonderful place to buy if you’re looking for your Florida beach front dream home.
Many affluent families and retirees choose the Sarasota as their home or get-a-way as it provides a private yet laid back lifestyle in a charming city. Sarasota is a wonderful place to raise families. The world-renowned beaches of Sarasota and its barrier island have been listed as one of the \”Top 10 most beautiful beaches in the world\” to visit. Arts and cultural activities of this area are national recognized. The Sarasota Film Festival brings famous actors from around the world to the city. When you are visiting Longboat Key, take a short drive through St. Armands Circle, cross the John Ringling Bridge and visit Sarasota. Like a rare gem, Sarasota is remains hidden by its residents, providing a refuge for those looking for luxury, beauty and privacy. If you visit Longboat key, you will probably return soon or you may never leave.
About The Author:
John Allen is the Broker of Allen Real Estate Services, Inc., a 30 year Sarasota Florida boutique real estate brokerage. Visit his award winning Sarasota real estate website to learn more about the hundreds of communities and search thousands of MLS listings. The comprehensive Longboat Key Florida real estate section has detailed information on all of Longboat Key’s most popular condos and neighborhoods. Learn more at: http://www.buysarasota.com/
Read more Articles written by John C Allen.
Lake Toxaway Homes for Sale – Your Dream Home Away From It All
Picture it. You’ve spent your time scoping out those gorgeous Lake Toxaway homes for sale, and now you’re ready to kick back and relax in your new lakeside or mountain view home.
While you were looking for your new home, you took the time to scope out all of the Lake Toxaway real estate and you even looked at some of the other Transylvania County real estate. You’ve finally settled on this lakeside home, and tonight as you sit watching the birds with that beautiful sunset in the background, the time spent with that Lake Toxaway real estate agent all seems worth it.
Of course you can picture it, but if you haven’t taken the time to check out Lake Toxaway NC yet, then you haven’t worked to make it your reality.
Lake Toxaway NC – The Area
Lake Toxaway NC provides quiet living away from it all, with natural beauty wherever you look. It’s the perfect place to live, to retire, or just to own that summer home that takes you away from the hustle of your busy life.
Besides the picturesque views and crystal clear waters of the lake itself, the area boasts many other amenities. For those who enjoy golf, the Lake Toxaway Country Club has just completed an 8 million dollar redesign to their award winning 18-hole golf course. Nature lovers also won’t be out of place. The area offers hiking, fishing, and wildlife viewing like no other.
Lake Toxaway Real Estate – Homes You’ll Find
When it comes to real estate in Lake Toxaway North Carolina, there are really a few different areas where you can look. Golfers will want to check out Lake Toxaway property that is close to the golf course and country club. For those who enjoy water sports, such as canoeing, fishing, or sailing, you may want to check out Lake Toxaway homes that border on the beautiful Lake Toxaway or the neighbouring Lake Cardinal. Of course, if you really like seclusion, there are private and quiet mountain homes that offer amazing views of beautiful mountains – waves of mountain range after mountain range after mountain range!
Lake Toxaway Homes for Sale – Finding Your Dream Home
If your interest is peaked and you’re ready to find your home away from it all, you’re really just a trip away from getting started. We have professional Lake Toxaway Realtors who can help you find the best Lake Toxaway homes for sale. They can also help you find that perfect Lake Toxoway property to build your home on, or just to find a Lake Toxaway rental so that you can spend some time getting familiar with the area before you buy.
Any way you look at it, if you’ve been seeking that perfect getaway, Lake Toxaway NC should top your list of places to see.
About The Author:
Written by: Alan Nilen. For more information about Lake Toxaway, and Asheville real estate, visit http://www.prudentiallifestylerealty.com/ today!
Read more of Alan Nilen’s articles.
Buying Property In Italy On The Cheap
Tuscany remains the No1 choice of investors looking to buy property in Italy.
Understanding The Due On Sale Clause On Your Home Mortgage
The \”Due On Sale Clause\” is among the most frequently misunderstood and most-feared legal terms in American contractual law. In this article, we are going to take a look at what it is, what it is not, and how to avoid violating it.
What Is The Due On Sale Clause?
On nearly every home mortgage and loan contract written in the United States, the Due On Sale Clause is one of those fine print inclusions that a lot of home buyers overlook.
In essence, the Due On Sale Clause is a legal term that means that if a mortgage holder transfers interest in a real property to a third-party, then the bank or other lender has the \”right\” to call the loan \”due in full\”, and if the mortgage holder cannot pay the loan in full at that time, the bank has the right to foreclose on the property.
It must be noted however that many banks and lending institutions do not enforce their rights in association to the Due On Sale Clause. Banks and lending institutions are \”not required\” to enforce the Due On Sale Clause, but they have the \”right\” to do so at their discretion.
Understanding The Foreclosure Process
This is an area that most consumers simply do not understand. In fact, just ten years ago, even I believed that if a home were foreclosed, the bank would hold the property until they could sell it at its full retail value.
But the truth is that banks and lending institutions generally do not make money when they foreclose a property. Instead, most banks will lose tens of thousands of dollars if they are forced to foreclose on a property.
Here is the reason why.
When a bank forecloses a property, they cannot afford to have non-performing real estate on their books. Banks and lenders also borrow money and have debts to service. So a piece of real estate on their books that is not generating an income is contrary to the lenders business model.
As a result, when banks foreclose on a property, they need to sell that property quickly. Foreclosed properties are sent to a sheriff’s sale, usually within 90 days of the completion of the foreclosure process.
Now, here is where we get into the dollars and cents of why your lender is going to lose tens of thousands of dollars when they are forced to foreclose your property. The average property sold at a sheriff’s auction will only generate 20- to 40-cents return against the retail value of the property!
So, if you have a 40% equity stake in your home at the time of foreclosure and your bank will only be able to collect 20% to 40% of the homes’ retail value at auction, your bank is still going to lose 20% to 40% of the retail value of the property at auction. If your home is worth $100,000, you will lose your 40% equity in the property or $40,000, and your bank will lose 20% to 40% of the retail value of the property or $20,000 to $40,000 when they sell your home at auction.
When you begin to understand why a bank or lender would not want to foreclose your home, then you begin to understand why a bank or lender may choose not to exercise its rights under the Due On Sale Clause.
The History Of The Due On Sale Clause
The Due On Sale Clause began to work its way into mortgage contracts during the 1970’s. Homeowners who took loans in the 1950’s and 1960’s were getting really low interest rates on home loans. But, during the 1970’s, interest rates began to spiral upwards.
Home sellers who were willing to entertain \”creative financing alternatives\” to sell their homes began to sell their homes to other parties through Contract For Deed arrangements. This enabled buyers to avoid going to the bank to get new loans, which would require a much higher interest rate than the rate the current homeowner was paying on the home.
The math was easy to follow. The existing homeowner was paying 2% to 4% interest on his or her mortgage. Buyers getting new loans would be paying 8% to 16% to buy the same house. Assumable mortgages were a clear winner for homebuyers, due to the higher interest rates on new loans, and they were a clear winner for home sellers who would be able to sell their homes more quickly to motivated buyers.
Banks viewed the Due On Sale Clause as a method to force buyers into a higher interest rate. So banks began to include the Due On Sale Clause on all mortgage contracts.
Early on, a few states sided with buyers who felt that the Due On Sale Clause was tantamount to predatory lending practices. So in the late-1970’s and early-1980’s, state governments began to outlaw the Due On Sale Clause.
However, the federal government sided with the banking and savings and loan industries and passed a law in 1982, The Garn-St. Germain Depository Institutions Act of 1982, that made the Due On Sale Clause legal in all fifty states – with a few exceptions defined by the legislation: (http://www4.law.cornell.edu/uscode/html/uscode12/usc_sec_12_00001701—j003-.html)
The Garn-St. Germain Depository Institutions Act of 1982 Exceptions
As with any document filled with legalese, the language can be somewhat confusing, leaving room for interpretation in the law. As a result, many real estate investors operate on the fringes of this legislation, doing things that some people consider legal and other people consider illegal.
In the 27 years since this legislation was passed, the federal government has not taken steps to clarify any of the ambiguity in the legislation. As a result, it is entirely possible to find lawyers who argue for each side of the specific interpretation of the legislation.
Although some elements of this legislation remain ambiguous, some elements of the legislation are crystal clear. (As always, you should consult with an attorney before signing any contract.)
One point that is crystal clear is that any loan written on a manufactured home (mobile home) cannot include a Due On Sale Clause. All loans made on a manufactured home may be assumed by a third-party. Vanderbilt Mortgage, one of the largest lenders on manufactured homes, makes the process super easy. They will send you a credit application for your buyer, and if the person passes credit check, that person can take over your home loan immediately under whatever terms you set.
Another exception includes the ability to sign a lease of up to three years, so long as that lease does not include an Option To Buy.
Allowances for an exception to the Due On Sale Clause have been included to reflect the possibilities of the death of a borrower or a couple getting a divorce.
One more important exception to the Due On Sale Clause has to do with Inter Vivos Trusts. Also called a Living Trust, the Inter Vivos Trust is a legal instrument that permits the transfer of the ownership of the property from the individual to a legal trust, managed by a trustee and held by the homeowner as beneficiary. This was important to note, because many real estate investors use this as a tool to protect the interests of the buyer and seller in the real estate transaction.
If you want to know all of the specifics of this legislation, please refer to the Cornell Law URL included above.
The Due On Sale Protects The Lenders’ Interests
Although banks and lending institutions have the \”right\” to enforce the Due On Sale Clause, most lending institutions will not exercise that right.
Some of the ambiguity that accompanies the legislation regarding the Due On Sale Clause is whether a borrower is required to notify his or her lender of a transfer of interest in a property. While it is fraud and a crime to mislead your lender, some argue that if you don’t tell your lender, then you will have circumvented the legal ramifications of violating the Due On Sale Clause. After all, if you don’t lie to your lender, then you have not committed any fraud.
The people who take this approach also believe that if the lender never figures it out, then nothing is lost if the buyer continues to make all of his or her payments on time every month.
Personally, I prefer that you play straight with your lender. As someone who buys homes that have a mortgage, it is in my best interest also, if the lender is aware of our intent to do a transaction. I would hate to buy your house under contract, pay on that house for one payment or dozens, and then have your lender discover that you did not tell them that I was buying your house. If your lender calls the Due On Sale Clause after I have worked out a purchase deal with you, then that would be a pain in my you-know-what.
Some lenders will not hesitate to call the Due On Sale Clause, although most are happy so long as they continue to receive on-time payments for the life of the loan.
That is why I suggest always to call your lender with a \”If I wanted to\” scenario. Don’t tell your lender \”you did it\”. Tell your lender before you sign the paperwork \”you would like to do it\”.
Test the waters with your lender before you venture into the deal. Chances are that your lender will agree, so long as the buyer knows that if the payments come late, that the bank may exercise its right to Due On Sale.
One More Note
Someone asked what a Demand Clause was and if it is similar to the Due On Sale Clause. It is similar, but very different. The Demand Clause allows the lender to demand full payment at any time for any reason. With the Due On Sale Clause, then full payment can only be required if the interest in the property changes hands.
In Conclusion
Tens of thousands of deals are done every year, where the mortgage holder sets up a Contract For Deed deal with a buyer, and the lending institution permits the transfer to happen unimpeded – even though the lending institution has the right to stop the transaction at any time under the terms of the Due On Sale Clause.
If you want to sell your home during this housing crisis and credit crunch, your first best bet is to call your lender and have a discussion about \”If I wanted to sell my house through a Contract For Deed\” scenario.
If your lender says that they would call the note, then you know that this option is not for you. However, if they indicate that they would be happy to let you go through with such a deal on certain terms, then you will know that you have another option for getting out of that house that you do not want anymore.
Author’s Note: This article originally published here:
http://www.libertyhomesellers.com/blog/2009/02/due-on-sale-clause/
About The Author:
Cory Shrader writes for the Liberty Home Sellers website. Liberty buys and sell homes in Oklahoma and has regular contacts with other real estate investors in many U.S. states, who also offer single-family homes for sale. If you are looking to sell a home, buy a home, or buy handyman specials, please visit our website and fill out the appropriate form on our website: http://www.LibertyHomeSellers.com
Buying And Selling a Home During a Credit Crunch
As President Obama is taking office, many people who had hoped to buy a home in 2008 or 2009 are stressing as to whether a bank will be found, which will finance a home purchase.
The TARP bill (Troubled Assets Relief Program of 2008) was intended to secure bad assets in our banking institutions, in order to permit banks to open their vaults once again and issue new loans. Four months down the road, banks are still holding onto their cash in a miserly way.
Contrary to most Americans and my fiscally conservative roots, I supported the passage of the TARP bill. I honestly believed that once the federal government secured the bad debt on the books of various banks, the banks would start loaning money again for commercial loans, new car loans and home mortgages.
The TARP bill passed, money was given to troubled banks, and we taxpayers got screwed. Along with many others – including the likes of Donald Trump – I was wrong. We underestimated the self-serving idiocy of the people who run our banking institutions.
Instead of using TARP money to secure the financial well being of their banks, the banking managers bought competing banks, remodeled their bathrooms, threw extravagant parties and gave themselves huge bonuses!
The credit crunch is still deeply entrenched in the United States and around the world. If TARP was unable to fix the credit crunch, I can only surmise that we will have a long and difficult, economic road in front of us all.
But What If You Need To Sell A Home Now?
Home sellers who need to sell a home now, and homebuyers who want to buy a home now, likely have only one option open to them, during this financial crisis. Interestingly, the option for home sellers and homebuyers is exactly the same – FSBO homes, or in layman-speak, For Sale By Owner homes.
As a home seller, FSBO can seem quite scary, but it shouldn’t be scary. As a seller, you have options available to help ensure that your buyer will stick to the path of righteousness.
As a seller, it is important to remember that you have something that someone else wants. And so long as there is someone out there that wants to own your home, you have the leverage to ensure that you will get the terms that you want in the transaction.
If you are wise, you will ALWAYS have your attorney review any paperwork in relationship to the sale of your home.
It must be noted that many mortgages have what is called a \”Due On Sale Clause\” in the paperwork. In essence, what this means is that your bank or mortgage holder has the \”option\” to call the mortgage \”due in full\”, when you sign interest in your property to a third-party. It should also be noted that if you sign a Lease With The Option To Buy with a third-party, and you do not tell your bank, then this amounts to fraud and is a federal crime.
With the legal issues on the table and known upfront, we can go to the next step. The \”Due On Sale Clause\” in your mortgage paperwork is only an \”option\” that a bank holds in a property, to ensure that they get paid what is owed to them. Basically, that clause is in the mortgage paperwork to ensure that if payment to them stops, then they still have the right to evict the lessee and take over the property.
BUT – and this is very important to realize – just because your mortgage has a \”Due On Sale Clause\” in it, does not mean that your mortgage holder will not authorize you to do a Lease To Own or FSBO agreement on your home. The Due On Sale Clause is an option that banks have, but banks do not always automatically take advantage of that option.
You have to put yourself in your banker’s shoes to understand why they would not force the \”Due On Sale Clause\” on your mortgage.
If you still owe, let’s say $60,000 on your $100,000 home, the bank stands to lose as much as $30 or $40,000 if they have to foreclose your home. When banks foreclose homes, they have to sell the homes as soon as possible at auction. But, homes typically sell at auction for as little as 20 to 40 cents on the dollar. So if you still owe more than 40 cents on the dollar against your original mortgage, chances are that the bank will lose a ton of money, if you force them to foreclose your home.
Banks as a rule – and more so in the current economic crisis – are typically more interested in having the house \”paid off in full\” than forcing a homeowner into taking more drastic actions, like deciding to let the bank to foreclose on the property. More often than not, the bank will permit the FSBO arrangement, on the condition that they continue to receive all monthly payments on time.
As a result, many banks will permit you to bypass the Due On Sale Clause, if you are willing to speak to them directly about the possibility. But, you have to open your mouth and talk to your banker, and then you need to get all of the legal agreements necessary to protect your interest and the bank’s interest in your property.
Talk first to your banker, then talk to your attorney and have the paperwork drawn up on a Lease with Option To Buy or other For Sale By Owner arrangement. With the appropriate permissions gained and the appropriate legally-binding paperwork in hand, you are now set to sell your home FSBO.
In most cases, your buyer will lease your home on yearly renewals, and then the moment they can secure a bank loan of their own, they will buy out the lease, permitting you to escape the mortgage on that home and permitting them to transfer the property into their own name.
Are You Seeking To Buy A Home?
People, who are serious about selling their home now and not holding that home until the financial crisis has ended, have started to get creative about how to sell their homes.
If you see a home listed as For Sale By Owner, chances are that the home seller has already taken the above-described steps to ensure that they will be able to sell their home now.
So, if you have a down payment available and you want to buy a home now, it may be in your best interests to seek out FSBO homes in the area where you wish to buy.
A friend of mine recently bought a quarter million dollar home under a Lease with Option To Buy agreement. Before the financial crisis, he had been waiting to find the perfect home, and in the current economic market, he was able to find the exact home he wanted to buy for the exact money he desired to spend on the purchase of his dream home.
The best thing about the Lease with Option To Buy is that you are only locked into the home for generally one or two years at a time, and if you decide that you would like to secure a home mortgage after the banks have started loaning money again, then you have the option to pay the homeowner the amount of money owed to take full ownership of the home.
We Cannot Afford To Wait Until The Banks Fix Their Mess
With the TARP bill, it was assumed that the banks would take the money from the federal government and fix the broken credit system. Unfortunately, the bankers screwed us and only fixed their personal bank accounts.
So, until the credit system magically fixes itself, we the consumers need to take matters into our own hands and get our own financial houses in order – no pun intended. If we are selling a home, we need to take action to get that home sold. And if we are trying to buy a house, seek out those people who are most motivated to sell you their home – look for that FSBO sign in front of the house or that FSBO ad in the newspaper.
Let us fix our economic system one FSBO at a time, and maybe we will be able to shorten the financial crisis that our politicians seem unable to fix for us.
About The Author:
Cory Shrader writes for the Liberty Home Sellers website. If you are ready to buy a home now, and the bank has tightened its credit policies, putting home ownership out of reach for you now, we might be able to help you. We buy and sell homes in north central Oklahoma. We offer owner financing on many of the homes we sell. Be sure to fill out the form on our website, so we can help you find your next family home. Learn more about available Oklahoma homes for sale at: http://www.LibertyHomeSellers.com
Finding Irish Castles for Sale
Have you ever dreamed about living in a castle? Have you imagined waking up in the morning and feeling like royalty? Well, consider making that dream a reality! Finding Irish castles for sale is possible. By following the suggestions I collected on my most recent trip to Ireland, you can purchase your very own Irish castle.
Castles in Ireland are plentiful. Not only are there expensive, beautifully-restored five-star castle hotels, but there are countless castles in various states of preservation and many, many castle ruins in disrepair. A few castles in each category come on the real estate market from time to time. Your budget and ambition will determine which segment of the market you are in.
You can get an idea of the variety of castles for sale by doing a quick internet search. There are a few castles listed on real estate sites, although some of the \”castles\” listed look like regular residences. Maybe these homes are in the category of \”a person’s home is their castle\”. Properties with views of castles nearby are also listed as \”castles\” for sale. Castle-shaped homes are also shown. Be sure to look for an authentic, original castle when you do your search.
If you are a buyer from outside of Ireland, you will need a representative in the country. Real estate agents in Ireland are called \”Auctioneers\” or \”Estate Agents\”, and work independently or belong to a group. The agents represent both buyers and sellers.
In the Republic of Ireland, most Estate Agents belong to the Irish Auctioneers and Valuers Institute or the Institute of Professional Auctioneers and Valuers and are state licensed. Northern Ireland is part of the United Kingdom and has a separate system of licensing.
Local and international property listing companies specialize in the rental and sale of Irish castles. If you are a qualified buyer, your agent will let you know when a castle in your desired location is listed for sale. It takes time, but castles do become available.
If you decide to buy a castle, your agent will handle the closing; you should also hire a solicitor (lawyer) to handle your legal work.
A factor you must consider when buying an Irish castle is that most castles need extensive repairs. Castles are ancient and some have even been vacant for centuries. Before buying a castle, it is important to get price estimates for necessary renovations from contractors. Total project prices can range from several hundred thousand euros to more than just one million. The cost of owning a castle, even after renovation, can be monumental.
A less costly option is to buy a castle ruin and leave it that way! There are hundreds of historic partial castle ruins throughout Ireland. You may find a piece of land with a castle ruin on it and build your own cottage or home on the same property.
After purchasing your castle, renovating it can be exhausting. It is possible to do it yourself if you can be in Ireland often or have the resources to manage the project from a distance. If not, help is available for the whole process.
A \”Property Locator\” will work on your behalf during the entire process of buying and renovating a castle. He or she will look for a castle for you based on all your needs and consult with agents, architects, solicitors and engineers to find your perfect purchase and price. The Property Locator will also manage the renovation of the castle. It is an expensive service, but will give you the security of having your project in expert hands.
If you decide that buying a castle in Ireland is your dream, the effort is worth the reward of owning one of the most unique properties in the world!
Copyright 2008, Patricia McKinney-Lins. All rights reserved.
About The Author:
Written by: Patricia G. McKinney-Lins. Take the worry out of booking your own special trip to the Emerald Isle. Go to the author’s website at http://www.majestic-castles-in-ireland.com for free travel advice and recommendations. Sign up for your free newsletter at http://www.majestic-castles-in-ireland.com/irish-castle-magic.html and get great travel tips for your next escape to Ireland!
