At the end of the year, it is quite normal to think about what has happened in the last 365 days and what will happen in the next 365 days. I encourage all to think of the following things for you and your family.
A. Update or write up a Will.
B. Update or writing up a Living Will and/or Power of Attorney
C. Designate Beneficiaries for financial accounts
D. Check how your Deeds are title- should they be updated, for example, to reflect husband and wife.
E. Check beneficiaries for life insurance policies, annuities, retirement plans.
Have a Happy, Safe, Peaceful and Prosperous New Year!
Monday, December 31, 2007
Thursday, November 8, 2007
Real Property Survey
When buying real estate, obtaining a survey is a good idea. If you have a survey, there a few things to review as recommended by the American Bar Association,
1. Survey is dated.
2. Surveyor’s signature and seal are present.
3. A north arrow is present and accurate (verify using a city map).
4. Description on the survey matches that on the search (surveyors must survey the description of record.
5. Acreage content is stated on the face of the survey, if this is a factor used in determining the price of the property or in permitting the property for anticipated purposes.
6. Address on the survey matches that given by the lender (recorded subdivision plat is the authority for the street name).
7. Surveyor’s inspection report and certificate are attached.
8. Survey is classified, if state has minimum standards requirements.
9. Flood-zone certification is included. Is flood insurance required? (Zone A-usually required; 10. Zone B-depends on lender; Zone C or X-not required.)
11. Easements and other matters that are listed on the title search appear on the survey. If easements are not located on the survey, contact the surveyor for an explanation. Are there easements or other matters not shown on the title search? These may represent potential litigation or may interfere with a plan for development.
12. Are there any undedicated roads? An undedicated road may evidence a claim of access across the subject property.
13. Are there gaps between parcels believed to be contiguous? These may prevent the purchaser from developing the property as desired.
14. Are there fences on the property? Fences may be evidence of adverse claims or boundary-line problems. They may also indicate agreements contrary to title information. It may be necessary to secure a boundary-line agreement with an adjoining landowner.
15. Are there overlapping easements or improvements that overlap easements?
16. Does the subject property have access to a public street or have access by virtue of a recorded easement that is shown on the survey?
17. Building set-backs are in compliance with the protective covenants. If there is a breach of protective covenants, a waiver may be necessary.
18 Are there encroachments of improvements onto the surveyed property? These encroachments may have ripened into claims to a portion of the property. If this is the case, an encroachment agreement may be desired.
19. Does the property have improvements that encroach onto adjoining property? This is also a cause of potential litigation. An encroachment agreement may be needed.
20. Review all “notes” on the survey. Are there indications of any unusual or unauthorized use of the property or unexpected conditions? An agricultural use may be evidence of possession inconsistent with record ownership. Historical or archeological sites may also be inconsistent.
21. Existence of wetlands may be of great importance. If any of these conditions exist, contact the surveyor.
22. Contact the surveyor regarding any unrecognizable symbols or other information that is unclear.
If there are any problems or unusual conditions indicated by the survey, have the purchaser execute a survey acceptance letter.
1. Survey is dated.
2. Surveyor’s signature and seal are present.
3. A north arrow is present and accurate (verify using a city map).
4. Description on the survey matches that on the search (surveyors must survey the description of record.
5. Acreage content is stated on the face of the survey, if this is a factor used in determining the price of the property or in permitting the property for anticipated purposes.
6. Address on the survey matches that given by the lender (recorded subdivision plat is the authority for the street name).
7. Surveyor’s inspection report and certificate are attached.
8. Survey is classified, if state has minimum standards requirements.
9. Flood-zone certification is included. Is flood insurance required? (Zone A-usually required; 10. Zone B-depends on lender; Zone C or X-not required.)
11. Easements and other matters that are listed on the title search appear on the survey. If easements are not located on the survey, contact the surveyor for an explanation. Are there easements or other matters not shown on the title search? These may represent potential litigation or may interfere with a plan for development.
12. Are there any undedicated roads? An undedicated road may evidence a claim of access across the subject property.
13. Are there gaps between parcels believed to be contiguous? These may prevent the purchaser from developing the property as desired.
14. Are there fences on the property? Fences may be evidence of adverse claims or boundary-line problems. They may also indicate agreements contrary to title information. It may be necessary to secure a boundary-line agreement with an adjoining landowner.
15. Are there overlapping easements or improvements that overlap easements?
16. Does the subject property have access to a public street or have access by virtue of a recorded easement that is shown on the survey?
17. Building set-backs are in compliance with the protective covenants. If there is a breach of protective covenants, a waiver may be necessary.
18 Are there encroachments of improvements onto the surveyed property? These encroachments may have ripened into claims to a portion of the property. If this is the case, an encroachment agreement may be desired.
19. Does the property have improvements that encroach onto adjoining property? This is also a cause of potential litigation. An encroachment agreement may be needed.
20. Review all “notes” on the survey. Are there indications of any unusual or unauthorized use of the property or unexpected conditions? An agricultural use may be evidence of possession inconsistent with record ownership. Historical or archeological sites may also be inconsistent.
21. Existence of wetlands may be of great importance. If any of these conditions exist, contact the surveyor.
22. Contact the surveyor regarding any unrecognizable symbols or other information that is unclear.
If there are any problems or unusual conditions indicated by the survey, have the purchaser execute a survey acceptance letter.
Thursday, October 18, 2007
How to Probate a Will
Often I am posed with the question, “What Happens when a person dies? What is the process regarding their estate?”
We are all familiar with the scene in the movies where after a person’s death, family and friends solemnly gather in the lawyer’s office. The will is then read out loud by the lawyer creating suspense, anxiousness and sometimes discontent.
The scene, however, is far from reality and just movie theatrics. In realty, there is no legal requirement for an official reading of the Will after a person’s death. Usually, the lawyers or personal representative will just mail copies of the will to the heirs.
Once a person dies, a Will may be probated. Probate is the process where a Will is proved to be valid by a Surrogate, the authority to determine the authenticity of such a document. It also involves appointing an individual for an Estate when someone dies without a Will.
Probate is performed when a person dies with assets in their name alone. The personal representative, officially known as the Executor/rix, would come to the office of the Surrogate with the original Will and a certified copy of the death certificate.
Application is made to the Surrogate of the County where the decedent resided at the time of death. If the Will is self- proving (language added to the will that allows the document to prove itself), no further proof or testimony will be necessary to probate the Will.
If the Will is not self-proving, a proof of one of the witnesses is necessary to complete the probate. The personal representative would fill out certain qualification forms. Although the Surrogate may begin the process, the probate can be completed until the day following the tenth day after death. There are fees to probate a Will, set forth by the New Jersey legislature, but usually not more than $200.00.
If someone dies without a Will, an individual can make application to be appointed as Administrator/rix to represent the Estate. After signing qualification papers, the Administrator/rix would need to post a bond that represents the full value of the Estate and file renunciations from any individual that has a prior or equal right to be appointed.
The Surrogate, as part of the process, will issue letters and certificates to support the appointment of the individual to the Estate, which will allow them to access and transfer assets such as bank accounts, stocks, bonds, and other financial documents.
Once the probate is complete, the personal representative of the Estate has sixty days in which to notify the heirs at law, next of kin and beneficiaries that application was made for probate.
The Executor/trix is required to pay the debts of the decedent and any taxes due, to perform a Child Support Judgment search on each beneficiary, to make distribution to the beneficiaries, and if required, to provide an accounting of his/her administration of the estate. An informal accounting may be requested by only the next-of-kin given on the Application for Probate or beneficiaries named under the Will and should not be requested until one year from date of probate. If the executor/trix refuses to comply with the request, an action may be brought in the Superior Court Probate Part for a formal accounting.Finally, the Executor/trix is required to file a New Jersey inheritance tax returns. The returns must be filed and the tax paid within eight months after the date of death to avoid interest. While an extension to file may be granted, the tax must still be paid initially.
Sunday, October 7, 2007
Irreconcilable differences
What do Hillary Swank and Kevin Federline, Pamela Anderson and Kid Rock, Paul McCartney and Heather Mills have in common? If you said they are all divorced, that is half right. They decided to split up based upon “irreconcilable differences.” That reason for divorce was not allowed in New Jersey until recently.
On January 20, 2007, Governor Corzine signed into law a new cause of action for divorce known as “irreconcilable differences”. Previously, most divorce complaints were based on fault, such as adultery or extreme cruelty where a person had to articulate specific grounds of cruel behavior.
There was only one no-fault cause, separation where the spouse must have been living separate and apart for at least 18 months. Now, an additional new no-fault cause of action, “irreconcilable differences” has been added.The new law means that a Complaint for Divorce based on irreconcilable differences must state:
a.) You and your spouse must have experienced irreconcilable differences for six months.
b.) You or your spouse must have lived in New Jersey for 12 consecutive months before the filing of the divorce complaint.
c.) The irreconcilable differences make it appear that the marriage should be dissolved.
d.) There is no reasonable prospect of reconciliation.
This new law has no separation requirement, meaning that two people can file for divorce under this cause of action if they still live together. This ground for divorce may be appropriate to allege in certain situations such as when two people have simply grown apart and wish to end their marriage, but still wish to reside together until the divorce is finalized. As a result, a sense of civility and practicality is introduced to diovrce law in New Jersey by eliminating the need for spouses to state specific acts of wrongdoing in the divorce papers which usually lead to more caustic situations.
On January 20, 2007, Governor Corzine signed into law a new cause of action for divorce known as “irreconcilable differences”. Previously, most divorce complaints were based on fault, such as adultery or extreme cruelty where a person had to articulate specific grounds of cruel behavior.
There was only one no-fault cause, separation where the spouse must have been living separate and apart for at least 18 months. Now, an additional new no-fault cause of action, “irreconcilable differences” has been added.The new law means that a Complaint for Divorce based on irreconcilable differences must state:
a.) You and your spouse must have experienced irreconcilable differences for six months.
b.) You or your spouse must have lived in New Jersey for 12 consecutive months before the filing of the divorce complaint.
c.) The irreconcilable differences make it appear that the marriage should be dissolved.
d.) There is no reasonable prospect of reconciliation.
This new law has no separation requirement, meaning that two people can file for divorce under this cause of action if they still live together. This ground for divorce may be appropriate to allege in certain situations such as when two people have simply grown apart and wish to end their marriage, but still wish to reside together until the divorce is finalized. As a result, a sense of civility and practicality is introduced to diovrce law in New Jersey by eliminating the need for spouses to state specific acts of wrongdoing in the divorce papers which usually lead to more caustic situations.
Friday, October 5, 2007
Navigating the Immigration World
Very often, the topic of immigration is raised. Here is one of the most popular questions posed: “Do you Have to be a U.S. citizen to file a petition for parents?”
Answer: Yes, you must be a U.S. citizen to file a family petition for your parents.
Unfortunately, the relatives you can petition differ depending on whether you are a U.S. citizen or a green card holder. U.S. citizens can file petitions for more types of relatives than green card holders can. In addition, some relatives of U.S. citizens do not have to wait for priority dates before their applications can be processed. In most cases, a U.S. citizen will be able to petition a relative more quickly than a green card holder can. However, there is one notable exception for Filipinos, which I will discuss later.
The most important petitioning benefit for U.S. citizens is the ability to get green cards for “immediate relatives” without being subject to priority dates or visa quotas. Immediate relative petitions are processed right away and are not subject to the lengthy waits of the priority date system. “Immediate relatives” of a U.S. citizen include the citizen’s parents (if the citizen is at least 21 years old), spouse, and unmarried children under 21 years old.There is a downside to immediate relative petitions, however. A U.S. citizen can only file an immediate relative petition for the relative and not the relative’s spouse or unmarried minor children. In most immigration petitions, the spouse and minor children of the relative being petitioned are included in the petition. They are known as “derivatives” under the immigration laws. Immediate relative petitions, however, do not include derivates.
For example, if a 21-year-old U.S. citizen files petitions for both of his parents, the parents will not be allowed to bring their 18-year-old daughter (the petitioner’s sister) with them. The daughter must be petitioned separately, either by the parents once they receive their green cards, or by the citizen in a separate petition (which is subject to a current priority date that is over 22 years ago).U.S. citizens can petition other relatives, but they are not processed immediately. Petitions can also be filed for children over 21, both married and single, and for siblings, but these petitions are subject to the quota system for green cards.
These relatives must wait until their priority date becomes current before he or she can get a green card. However, these relatives are allowed to bring their derivative family members. For example, if a U.S. citizen files for his married son in the Philippines, the son’s wife and unmarried minor kids will get green cards at the same time when the son’s priority date becomes current.Green card holders have more limited petition options. They can only file petitions for spouses and unmarried children. Both of these types of relatives are subject to the quota system, and they must wait for a current priority date before immigrating.
There is no “immediate relative” classification for green card holders. However, there is one benefit to being a Filipino green card holder over a U.S. citizen: it is actually faster for green card holders to petition an unmarried child over 21. The current priority date for single adult Filipino children petitioned by green card holders is in 1996, while the same category of children petitioned by U.S. citizens is in 1992. Visas should be available faster for single children of green card holders than for single children of U.S. citizens.
What happens if a green card holder petitions an unmarried adult child but then becomes a U.S. citizen? Your child can request to retain the status of a child of a green card holder by writing the U.S. Citizenship and Immigration Services office in Manila. Understanding the complexities of family petitions can be difficult. It is always advised to consult an experienced attorney to assist you in bringing your relatives to the United States.
Sunday, September 30, 2007
Faced with Foreclosure?
Recently, I received a call from a client who advised that they can not afford to pay the mortgage on their home. They are behind in their mortgage about 3 months. What should they do?
Firstly, what is foreclosure?
Foreclosure is the legal proceed that allows the lender to repossess (take back) your home. When this happens, you must move out of your house. If your property is worth less than the total amount you owe on your mortgage loan, your lender or HUD could seek a deficiency judgment against you. If that happens, you not only lose your home, but you also would owe your lender or HUD an additional (and possibly substantial) debt.Foreclosure or a deficiency judgment could seriously affect your ability to qualify for credit in the future so you should avoid it! In fact, foreclosure is worse than filing for bankruptcy.
When you buy a home by borrowing money from a financial institution to buy real estate, you sign a legal contract called a mortgage. A Mortgage obligates you to pay the lender on a certain day of the month until the loan is paid off. Also, there are other terms expressed in the mortgage contract but the most serious breach of contract happens when the borrower does not pay the mortgage payment.Then the financial institution is forced to begin the steps that can ultimately end with them obtaining the ownership of the real estate property. This procedure is commonly referred to as a bank foreclosure.In most of our minds, foreclusr conjures up imamges of the bank as an enormous heartless ogre kicking little old ladies to the curb on Christmas eve.
In reality, a bank foreclosure is necessary for the financial institution to maintain its integrity and to protect the interests of its investors, depositors and employees. It is also important to remember that bank foreclosure is a long and tedious process that provides ample opportunities for borrowers to negotiate with the lenders to find alternative solutions to bank foreclosures.
1. Don't lose your home and ruin your credit. If at all possible call or write your mortgage lender immediately.
If financial problems are looming, you need to notify your lender at the first sign of trouble and explain your situation - that would be as soon as you know you're going to start missing mortgage payments. Many lenders will give you time to help get your financial life back on track.
If your lender is sending you letters regarding the fact that payments have been missed, DO NOT IGNORE those letters. Be ready to give your lender your personal financial information, such as monthly expenses and income because, without this information, you will not receive much assistance. "Workouts" (as they are known) look better from a public relations standpoint and usually cost thousands of dollars less than full foreclosures and home repossessions.
2. Do not move out of your home. To qualitfy for assistance, remain in your home to AND make an appointment with a HUD-approved housing counselor for more optionsIf you move out of your home, the lender will assume that you have abandoned the property, and disqualify for you for assistance. Contact a HUD-approved housing counseling agency for information on services and programs that could help you. If you bought your home with a Veterans Administration (VA) guaranteed loan, call the VA office nearest you.
Other options include:
Special forbearance - is a written repayment agreement between you and the bank which contains a repayment plan to reinstate your loan. Your lender may be able to arrange a repayment plan based on your financial situation.
Mortgage modification - You may be able to refinance the debt and/or extend the term of your mortgage loan. In a modification, the lender actually adjusts the terms of the loan to make it affordable. Similar to credit card companies, a lender may adjust your interest rate and payment if you've experienced difficulties. Contact your lender and ask for the phone number to the "Loss Mitigation" Department. Lenders do not want your property; a Real Estate Owned is a liability to them.
Pre-foreclosure sale – allows you to sell your property and pay off your mortgage loan to avoid foreclosure, but with a damaged credit rating. You may qualify if the "as is" appraised value is at least 70% of the amount you owe and the sales price is 95% of the appraised value; the loan is at least 2 months delinquent prior to the pre-foreclosure sale closing date; and you are able to sell your house within a time frame agreeable toa lender.
Deed-in-lieu of foreclosure: As a last resort, you may be able to voluntarily "give back" your property to the lender. This won't save your house, but it will increase your chances of obtaing another mortgage loan in the future. You would qualify if: a.) you are in default, b) don't qualify for any of the other options; c) your attempts at selling the house before foreclosure were unsuccessful; and d) you don't have another FHA mortgage in default.
3. Cooperate with the counselor or lender trying to help youLenders really do want to help you to stay in your home - and they should be polite in trying to help you, the borrower, stay there. When there is a connection between the lender and borrower, the more likely it is that the borrower will try to stay in the home. Once a borrower is 16 days late, the loan servicer will try to get in touch with the customer at that point and figure out a way to bring the payment current. You can also contact Consumers Credit Counseling. The help is free or extremely affordable. Counselors can work with creditors to help borrowers make their installment payments (credit cards, for example) or even get them eliminated altogether. You should contact them early before things are too far-gone. Don't pay anyone for advice or service - most reputable credit counseling services provide free service.
Work with your lender. Don't keep your problems a secret.
4. Explore every alternative to losing your home. The lender may agree to help the borrower get rid of the house via a pre-foreclosure sale. In more dire circumstances, the servicer will agree to a "short sale." In such sales, the lender lets the borrower sell the house for less than the outstanding loan amount, takes the proceeds and forgives any remaining overage. Banks are willing to do so because they often lose less on these deals than they do in foreclosures.
Are there other ways you can try to pay your mortgage? Sure. Here are some drastic options but remember that these too can damage your credit and/or cause other problems if not handled correctly.
If all else fails ... Consumers who can't use any of these methods still have some choices. A debtor who can afford the normal monthly mortgage payment, but can't afford to make up the delinquent amount and legal fees because the lender is proposing a relatively stringent repayment plan, may want to consider filing Chapter 13 bankruptcy. Doing so temporarily halts the foreclosure process and can force the mortgage lender to accept a more borrower-friendly repayment plan, such as one that grants five years to repay the amount in arrears rather than one or two.
Around the 90th to 120th day is when the loan is reported to foreclosure and from that point on, two things are going on simultaneously. The foreclosure department is moving as quickly as possible to get to the foreclosure sale and the loss mitigation department is working with the borrower to try to do a workout. If the workout can be done before the foreclosure sale takes place, then everybody wins and the workout is done. If that can't be done, the foreclosure sale is held.Following the same logic, customers should try to negotiate the best deal they can get without feeling guilty. Someone whose property has fallen in value below the mortgage amount because of a neighborhood decline, for example, should consider pushing for a short sale or short refinance rather than a repayment plan. That way, the borrower doesn't pay more money than necessary. Nevertheless, the best way for consumers to get out of foreclosure without racking up extensive legal bills and ruining their credit histories is to start working on a solution before their problems get out of hand. DON'T IGNORE YOUR FINANCIAL PROBLEMS!
5. Don’t Be Fooled! Solutions that sound too good to be true usually are. If you're selling your home without professional guidance, beware of buyers who try to rush you through the process. Unfortunately, there are people who may try to take advantage of your financial difficulty. Be especially alert to the following:Equity skimming. Here, the "buyer" approaches you, offering to get you out of financial trouble by promising to pay off your mortgage or give you a sum of money when the property is sold. The "buyer" may suggest that you move out quickly and deed the property to him or her. The "buyer" then collects rent for a time, does not make any mortgage payments, and allows the lender to foreclose. Remember that signing over your deed to someone else does not necessarily relieve you of your obligation on your loan.Fake counseling agencies. There are some companies that call themselves "counseling agencies." They offer to perform certain services for a fee, that you could do for yourself, for free, such as negotiating a new payment plan with your lender, or pursuing a pre-foreclosure sale. If you have any questions about paying for these services, call a HUD-approved housing counseling agency. Do this before you pay anyone or sign anything.
6. Do not sign anything you don't understand. Remember that signing over the deed to someone else does not necessarily relieve you of your loan obligation. Don't sign any papers you don't fully understand.
Always, check with a lawyer or your mortgage company before entering into any deal involving your home.
Firstly, what is foreclosure?
Foreclosure is the legal proceed that allows the lender to repossess (take back) your home. When this happens, you must move out of your house. If your property is worth less than the total amount you owe on your mortgage loan, your lender or HUD could seek a deficiency judgment against you. If that happens, you not only lose your home, but you also would owe your lender or HUD an additional (and possibly substantial) debt.Foreclosure or a deficiency judgment could seriously affect your ability to qualify for credit in the future so you should avoid it! In fact, foreclosure is worse than filing for bankruptcy.
When you buy a home by borrowing money from a financial institution to buy real estate, you sign a legal contract called a mortgage. A Mortgage obligates you to pay the lender on a certain day of the month until the loan is paid off. Also, there are other terms expressed in the mortgage contract but the most serious breach of contract happens when the borrower does not pay the mortgage payment.Then the financial institution is forced to begin the steps that can ultimately end with them obtaining the ownership of the real estate property. This procedure is commonly referred to as a bank foreclosure.In most of our minds, foreclusr conjures up imamges of the bank as an enormous heartless ogre kicking little old ladies to the curb on Christmas eve.
In reality, a bank foreclosure is necessary for the financial institution to maintain its integrity and to protect the interests of its investors, depositors and employees. It is also important to remember that bank foreclosure is a long and tedious process that provides ample opportunities for borrowers to negotiate with the lenders to find alternative solutions to bank foreclosures.
1. Don't lose your home and ruin your credit. If at all possible call or write your mortgage lender immediately.
If financial problems are looming, you need to notify your lender at the first sign of trouble and explain your situation - that would be as soon as you know you're going to start missing mortgage payments. Many lenders will give you time to help get your financial life back on track.
If your lender is sending you letters regarding the fact that payments have been missed, DO NOT IGNORE those letters. Be ready to give your lender your personal financial information, such as monthly expenses and income because, without this information, you will not receive much assistance. "Workouts" (as they are known) look better from a public relations standpoint and usually cost thousands of dollars less than full foreclosures and home repossessions.
2. Do not move out of your home. To qualitfy for assistance, remain in your home to AND make an appointment with a HUD-approved housing counselor for more optionsIf you move out of your home, the lender will assume that you have abandoned the property, and disqualify for you for assistance. Contact a HUD-approved housing counseling agency for information on services and programs that could help you. If you bought your home with a Veterans Administration (VA) guaranteed loan, call the VA office nearest you.
Other options include:
Special forbearance - is a written repayment agreement between you and the bank which contains a repayment plan to reinstate your loan. Your lender may be able to arrange a repayment plan based on your financial situation.
Mortgage modification - You may be able to refinance the debt and/or extend the term of your mortgage loan. In a modification, the lender actually adjusts the terms of the loan to make it affordable. Similar to credit card companies, a lender may adjust your interest rate and payment if you've experienced difficulties. Contact your lender and ask for the phone number to the "Loss Mitigation" Department. Lenders do not want your property; a Real Estate Owned is a liability to them.
Pre-foreclosure sale – allows you to sell your property and pay off your mortgage loan to avoid foreclosure, but with a damaged credit rating. You may qualify if the "as is" appraised value is at least 70% of the amount you owe and the sales price is 95% of the appraised value; the loan is at least 2 months delinquent prior to the pre-foreclosure sale closing date; and you are able to sell your house within a time frame agreeable toa lender.
Deed-in-lieu of foreclosure: As a last resort, you may be able to voluntarily "give back" your property to the lender. This won't save your house, but it will increase your chances of obtaing another mortgage loan in the future. You would qualify if: a.) you are in default, b) don't qualify for any of the other options; c) your attempts at selling the house before foreclosure were unsuccessful; and d) you don't have another FHA mortgage in default.
3. Cooperate with the counselor or lender trying to help youLenders really do want to help you to stay in your home - and they should be polite in trying to help you, the borrower, stay there. When there is a connection between the lender and borrower, the more likely it is that the borrower will try to stay in the home. Once a borrower is 16 days late, the loan servicer will try to get in touch with the customer at that point and figure out a way to bring the payment current. You can also contact Consumers Credit Counseling. The help is free or extremely affordable. Counselors can work with creditors to help borrowers make their installment payments (credit cards, for example) or even get them eliminated altogether. You should contact them early before things are too far-gone. Don't pay anyone for advice or service - most reputable credit counseling services provide free service.
Work with your lender. Don't keep your problems a secret.
4. Explore every alternative to losing your home. The lender may agree to help the borrower get rid of the house via a pre-foreclosure sale. In more dire circumstances, the servicer will agree to a "short sale." In such sales, the lender lets the borrower sell the house for less than the outstanding loan amount, takes the proceeds and forgives any remaining overage. Banks are willing to do so because they often lose less on these deals than they do in foreclosures.
Are there other ways you can try to pay your mortgage? Sure. Here are some drastic options but remember that these too can damage your credit and/or cause other problems if not handled correctly.
If all else fails ... Consumers who can't use any of these methods still have some choices. A debtor who can afford the normal monthly mortgage payment, but can't afford to make up the delinquent amount and legal fees because the lender is proposing a relatively stringent repayment plan, may want to consider filing Chapter 13 bankruptcy. Doing so temporarily halts the foreclosure process and can force the mortgage lender to accept a more borrower-friendly repayment plan, such as one that grants five years to repay the amount in arrears rather than one or two.
Around the 90th to 120th day is when the loan is reported to foreclosure and from that point on, two things are going on simultaneously. The foreclosure department is moving as quickly as possible to get to the foreclosure sale and the loss mitigation department is working with the borrower to try to do a workout. If the workout can be done before the foreclosure sale takes place, then everybody wins and the workout is done. If that can't be done, the foreclosure sale is held.Following the same logic, customers should try to negotiate the best deal they can get without feeling guilty. Someone whose property has fallen in value below the mortgage amount because of a neighborhood decline, for example, should consider pushing for a short sale or short refinance rather than a repayment plan. That way, the borrower doesn't pay more money than necessary. Nevertheless, the best way for consumers to get out of foreclosure without racking up extensive legal bills and ruining their credit histories is to start working on a solution before their problems get out of hand. DON'T IGNORE YOUR FINANCIAL PROBLEMS!
5. Don’t Be Fooled! Solutions that sound too good to be true usually are. If you're selling your home without professional guidance, beware of buyers who try to rush you through the process. Unfortunately, there are people who may try to take advantage of your financial difficulty. Be especially alert to the following:Equity skimming. Here, the "buyer" approaches you, offering to get you out of financial trouble by promising to pay off your mortgage or give you a sum of money when the property is sold. The "buyer" may suggest that you move out quickly and deed the property to him or her. The "buyer" then collects rent for a time, does not make any mortgage payments, and allows the lender to foreclose. Remember that signing over your deed to someone else does not necessarily relieve you of your obligation on your loan.Fake counseling agencies. There are some companies that call themselves "counseling agencies." They offer to perform certain services for a fee, that you could do for yourself, for free, such as negotiating a new payment plan with your lender, or pursuing a pre-foreclosure sale. If you have any questions about paying for these services, call a HUD-approved housing counseling agency. Do this before you pay anyone or sign anything.
6. Do not sign anything you don't understand. Remember that signing over the deed to someone else does not necessarily relieve you of your loan obligation. Don't sign any papers you don't fully understand.
Always, check with a lawyer or your mortgage company before entering into any deal involving your home.
Saturday, September 22, 2007
Choosing a Guardian for Your Children
Having children is both exciting and daunting. And if you are like me, you often wonder, who would raise them if something were to happen to me? Well, if you have children, you should seriously consider choosing a personal guardian -- someone to raise them in the event you can't.
While your children are young, consider some simple arrangements now that will allay some of your fears, knowing that if you can't raise your kids, you have someone to take care of them.
Naming a Personal Guardian
Name one personal guardian (and one alternate, in the event that your first choice is unable to serve) for your children. Legally, you may name more than one guardian, but it's generally not a good idea because should the co guardians disagree and cannot resolve their differences as to raising your kids. There are instances, however, where two people can care for your child. For instance, you could name a stable couple who would act as co parents. Place both names in your
Will, so that they each have the legal power to make important decisions on behalf of your child.
When choosing a guardian, think about the following:
-Is the prospective guardian mature and of age? (You must choose an adult -- 18 years old in most states.)
-Does the guardian sincerely care about your children?
-Does he or she have other children to care for?
-Does the guardian have any health concerns that would make it difficult for him or her to care for your children?
-Does the guardian have similar moral beliefs?
-Consider where your Guardian resides. Would your children have to move out of the state or country?
-Would you have enough financial assets to raise the children? If not, would your guardian be able to afford raising them?
Take your time to discuss your concerns with the prospective guardian. One or more of them may not be willing or able to accept the responsibility, or their actions and feelings about being the guardian may help you decide.
While your children are young, consider some simple arrangements now that will allay some of your fears, knowing that if you can't raise your kids, you have someone to take care of them.
Naming a Personal Guardian
Name one personal guardian (and one alternate, in the event that your first choice is unable to serve) for your children. Legally, you may name more than one guardian, but it's generally not a good idea because should the co guardians disagree and cannot resolve their differences as to raising your kids. There are instances, however, where two people can care for your child. For instance, you could name a stable couple who would act as co parents. Place both names in your
Will, so that they each have the legal power to make important decisions on behalf of your child.
When choosing a guardian, think about the following:
-Is the prospective guardian mature and of age? (You must choose an adult -- 18 years old in most states.)
-Does the guardian sincerely care about your children?
-Does he or she have other children to care for?
-Does the guardian have any health concerns that would make it difficult for him or her to care for your children?
-Does the guardian have similar moral beliefs?
-Consider where your Guardian resides. Would your children have to move out of the state or country?
-Would you have enough financial assets to raise the children? If not, would your guardian be able to afford raising them?
Take your time to discuss your concerns with the prospective guardian. One or more of them may not be willing or able to accept the responsibility, or their actions and feelings about being the guardian may help you decide.
Wednesday, September 19, 2007
LANDLORDS - EVICTING TENANTS FOR NON-PAYMENT OF RENT
The following are certain remedies and recommendations to landlords if the tenant fails to pay rent.
1. Do you have a WRITTEN LEASE? A written lease is recommended for all rentals even for a month to month. Your lease should specifically require that the tenant pay the landlord's attorney's fees if they fail to pay rent or breach the lease in any way. If a written lease does not provide for attorneys fees, the court cannot award attorneys fees. In addition, your lease should provide in writing for re-renting cost if the tenant breaches the lease. Many leases also provide for late fees.
2. NON-PAYMENT OF RENT If your tenant fails to pay and you want to evict the tenant, a Tenancy Summons Dispossess Eviction Complaint must be filed in the Supreme Court's Special Civil Part. The court filing fee is less than $50. Different attorneys charge different fees depending upon the amount of work to be done. Your attorney can prepare the mandatory complaint and summons. The court constable is required to personally serve the tenant with a copy of the complaint. The court clerk will fill out the date and time for hearing on the summons, which also will be served on the tenant. You and your attorney should appear on the date for hearing. If the tenant appears, parties sometimes work out a payment plan for rent with a stipulation of settlement and stay of eviction. The landlord and tenant usually agree if all rent is not paid according to the schedule, the court is directed to issue a warrant for possession.
3. FAILURE OF TENANT TO APPEAR If the tenant fails to appear by the second call, you can pay an additional fee for a warrant of removal. This is obtained at the Special Civil Part Clerk, Tenancy Section Office. After waiting three days, the constable is given the warrant to serve at the tenant's property. If the tenant still fails to move, arrangements can be made with the constable and locksmith to physically remove the tenants and change locks.
4. REGISTRATION OF PROPERTY Most residential units most be registered with the town. It is a good idea to bring proof of registration when you go to court.
5. FILE A SPECIAL CIVIL PART COMPLAINT FOR MONEY OWED Most eviction complaints are evictions based only on non-payment of rent. The New Jersey Anti-Eviction Act places substantial notice requirement on landlords who wish to evict tenants for reasons other than non-payment of rent. If the tenant is able to pay the rent in full prior to warrant of possession, the court will let the tenant remain in the property.
6. HOW TO GET YOUR MONEY The Tenancy Judge will not require the tenant to pay attorneys fees, damages and other costs. This court can only evict tenants, or permit tenants to remain if they paid the rent in full. To protect yourself and get all money due, file a money owed complaint in the Special Civil Part. The filing fee is less than $50.
The following are certain remedies and recommendations to landlords if the tenant fails to pay rent.
1. Do you have a WRITTEN LEASE? A written lease is recommended for all rentals even for a month to month. Your lease should specifically require that the tenant pay the landlord's attorney's fees if they fail to pay rent or breach the lease in any way. If a written lease does not provide for attorneys fees, the court cannot award attorneys fees. In addition, your lease should provide in writing for re-renting cost if the tenant breaches the lease. Many leases also provide for late fees.
2. NON-PAYMENT OF RENT If your tenant fails to pay and you want to evict the tenant, a Tenancy Summons Dispossess Eviction Complaint must be filed in the Supreme Court's Special Civil Part. The court filing fee is less than $50. Different attorneys charge different fees depending upon the amount of work to be done. Your attorney can prepare the mandatory complaint and summons. The court constable is required to personally serve the tenant with a copy of the complaint. The court clerk will fill out the date and time for hearing on the summons, which also will be served on the tenant. You and your attorney should appear on the date for hearing. If the tenant appears, parties sometimes work out a payment plan for rent with a stipulation of settlement and stay of eviction. The landlord and tenant usually agree if all rent is not paid according to the schedule, the court is directed to issue a warrant for possession.
3. FAILURE OF TENANT TO APPEAR If the tenant fails to appear by the second call, you can pay an additional fee for a warrant of removal. This is obtained at the Special Civil Part Clerk, Tenancy Section Office. After waiting three days, the constable is given the warrant to serve at the tenant's property. If the tenant still fails to move, arrangements can be made with the constable and locksmith to physically remove the tenants and change locks.
4. REGISTRATION OF PROPERTY Most residential units most be registered with the town. It is a good idea to bring proof of registration when you go to court.
5. FILE A SPECIAL CIVIL PART COMPLAINT FOR MONEY OWED Most eviction complaints are evictions based only on non-payment of rent. The New Jersey Anti-Eviction Act places substantial notice requirement on landlords who wish to evict tenants for reasons other than non-payment of rent. If the tenant is able to pay the rent in full prior to warrant of possession, the court will let the tenant remain in the property.
6. HOW TO GET YOUR MONEY The Tenancy Judge will not require the tenant to pay attorneys fees, damages and other costs. This court can only evict tenants, or permit tenants to remain if they paid the rent in full. To protect yourself and get all money due, file a money owed complaint in the Special Civil Part. The filing fee is less than $50.
Saturday, September 15, 2007
FAQs regarding Wills:
What happens if I die without a will?
If you don't make a will or use some other legal method to transfer your property when you die, state law will determine what happens to your property. Generally, it will go to your spouse and children or, if you have neither, to your other closest relatives. If no relatives can be found to inherit your property, it will go to the state.
In addition, in the absence of a will, a court will determine who will care for your young children and their property if the other parent is unavailable or unfit.
If you are part of an unmarried same-sex couple, your surviving partner will not inherit anything unless you live in one of the few states that allows registered domestic partners to inherit like spouses: California, Connecticut, Maine, New Jersey, and Vermont.
What is a Will?
A Will is a document containing directions setting out how the property of the person making the Will (the “Testator”) shall be distributed upon his or her death.
Are my debts forgiven when I die?
No.
One of the duties of an Executor is to determine the debts, including taxes, of the deceased person. The Executor must determine what debts you have and must satisfy those debts, including taxes, from the proceeds of your Estate prior to distributing your Estate to your Beneficiaries.
What happens with insurance proceeds when I die?
The death benefit payable under a life insurance policy is received tax free by the deceased’s Estate or by one or more named Beneficiaries. Insurance proceeds left to your Estate are then dealt with pursuant to your intentions set-out in your Will. Insurance proceeds left to a specific named Beneficiary do not form part of your Estate and pass directly to the named Beneficiary.
I saw a Will kit at a store. Why can’t I just use that?
Only an attorney can legally draft a will for a person, unless a person drafts his own will. Wills that are personally drafted with the help of a will form from a store are often incomplete, and therefore invalid under state law. An invalid will is worthless. Kits for writing a will are normally not state-specific. If your will fails to follow state law, it will be invalid
What happens if I die without a will?
If you don't make a will or use some other legal method to transfer your property when you die, state law will determine what happens to your property. Generally, it will go to your spouse and children or, if you have neither, to your other closest relatives. If no relatives can be found to inherit your property, it will go to the state.
In addition, in the absence of a will, a court will determine who will care for your young children and their property if the other parent is unavailable or unfit.
If you are part of an unmarried same-sex couple, your surviving partner will not inherit anything unless you live in one of the few states that allows registered domestic partners to inherit like spouses: California, Connecticut, Maine, New Jersey, and Vermont.
What is a Will?
A Will is a document containing directions setting out how the property of the person making the Will (the “Testator”) shall be distributed upon his or her death.
Are my debts forgiven when I die?
No.
One of the duties of an Executor is to determine the debts, including taxes, of the deceased person. The Executor must determine what debts you have and must satisfy those debts, including taxes, from the proceeds of your Estate prior to distributing your Estate to your Beneficiaries.
What happens with insurance proceeds when I die?
The death benefit payable under a life insurance policy is received tax free by the deceased’s Estate or by one or more named Beneficiaries. Insurance proceeds left to your Estate are then dealt with pursuant to your intentions set-out in your Will. Insurance proceeds left to a specific named Beneficiary do not form part of your Estate and pass directly to the named Beneficiary.
I saw a Will kit at a store. Why can’t I just use that?
Only an attorney can legally draft a will for a person, unless a person drafts his own will. Wills that are personally drafted with the help of a will form from a store are often incomplete, and therefore invalid under state law. An invalid will is worthless. Kits for writing a will are normally not state-specific. If your will fails to follow state law, it will be invalid
Friday, September 14, 2007
Estate Planning in a Nutshell
A will is the expression of the person's wishes concerning how their property is to be distributed. It is a written statement, signed in compliance with the various formalities covered by legislation. It is a legal document containing the names of the people you want to benefit, as well as details of your possessions at the date of your death. The people you want to benefit are called beneficiaries.
Basically, for a Will, you need to designate an executor or an executrix. An executor is a person who will manage the Will once a person passes. You should provide an alternate, also, in case that person is unable to serve as an executor. Usually, people choose a close family member who is around locally. If there are no family members situated locally, please choose someone that you ultimately trust.
Now, your Will should contemplate how you wish your assets to be distributed should something happen to you. If you choose minors as beneficiaries, you will need to create a trust, because a minor is not able to receive proceeds on their own.
A Living Will and healthcare proxy are also vital to your entire package. A Living Will takes effect when you either are in a irreversible coma or have a terminal illness. This document allows you to grant specific wishes as to how your health issues should be handled.
The health care proxy allows you to nominate a person who will act on your behalf with regards to your medical needs. You do not need to be terminally ill or in an irreversible coma in order for this health care proxy to take effect. The health care proxy, again, is a representative who will make your health care decisions if you are unable to speak or in a temporary unavailable situation.
A will is the expression of the person's wishes concerning how their property is to be distributed. It is a written statement, signed in compliance with the various formalities covered by legislation. It is a legal document containing the names of the people you want to benefit, as well as details of your possessions at the date of your death. The people you want to benefit are called beneficiaries.
Basically, for a Will, you need to designate an executor or an executrix. An executor is a person who will manage the Will once a person passes. You should provide an alternate, also, in case that person is unable to serve as an executor. Usually, people choose a close family member who is around locally. If there are no family members situated locally, please choose someone that you ultimately trust.
Now, your Will should contemplate how you wish your assets to be distributed should something happen to you. If you choose minors as beneficiaries, you will need to create a trust, because a minor is not able to receive proceeds on their own.
A Living Will and healthcare proxy are also vital to your entire package. A Living Will takes effect when you either are in a irreversible coma or have a terminal illness. This document allows you to grant specific wishes as to how your health issues should be handled.
The health care proxy allows you to nominate a person who will act on your behalf with regards to your medical needs. You do not need to be terminally ill or in an irreversible coma in order for this health care proxy to take effect. The health care proxy, again, is a representative who will make your health care decisions if you are unable to speak or in a temporary unavailable situation.
How is alimony determined?
A family court has a fair amount of discretion to determine an alimony award. The New Jersey Supreme Court has established some very specific guidelines and formulas to determine child support. There are, however, no alimony guidelines. Most people do not enjoy paying child support, but they pay it anyway because they love their kids. Most people, however, are not too fond of their ex-wife or husband, so they hate paying alimony.
I believe that any proposed alimony guidelines would be just too controversial and it will never become law. There exists case law in New Jersey and a statute that requires the courts to consider very specific factors when it calculates alimony. There are some guidelines and objective standards for the courts to consider, but there is not specific formula for a family court to calculate alimony.
In general, New Jersey case law states that the court must consider the marital lifestyle, the supporting spouse's ability to pay, and the dependent spouse's ability to contribute to his/her own support.The alimony statute, N.J.S.A. 2A:34-23(b) states that the court must consider the following thirteen factors:
1. The actual need and ability of the parties to pay.2. The duration of the marriage.3. The age, physical and emotional health of the parties.4. The standard of living established during the marriage and the likelihood that each party can maintain a reasonable comparable standard of living.5. The parties' earning capability, education and employability.6. The length of absence from the job market.7. Parental responsibilities for the children.8. The time and expense needed to acquire education or training to enable a depended spouse to obtain appropriate employment.9. The financial and non-financial contributions of each spouse to the marriage.10. Equitable distribution.11. Income available and non-financial contributions of each spouse to the marriage.12. The tax consequences of alimony.13. Any other factor which the court deems relevant.
In summary, the main purpose of alimony is to permit the dependent spouse to live the same lifestyle after divorce that she lived during the marriage.
A family court has a fair amount of discretion to determine an alimony award. The New Jersey Supreme Court has established some very specific guidelines and formulas to determine child support. There are, however, no alimony guidelines. Most people do not enjoy paying child support, but they pay it anyway because they love their kids. Most people, however, are not too fond of their ex-wife or husband, so they hate paying alimony.
I believe that any proposed alimony guidelines would be just too controversial and it will never become law. There exists case law in New Jersey and a statute that requires the courts to consider very specific factors when it calculates alimony. There are some guidelines and objective standards for the courts to consider, but there is not specific formula for a family court to calculate alimony.
In general, New Jersey case law states that the court must consider the marital lifestyle, the supporting spouse's ability to pay, and the dependent spouse's ability to contribute to his/her own support.The alimony statute, N.J.S.A. 2A:34-23(b) states that the court must consider the following thirteen factors:
1. The actual need and ability of the parties to pay.2. The duration of the marriage.3. The age, physical and emotional health of the parties.4. The standard of living established during the marriage and the likelihood that each party can maintain a reasonable comparable standard of living.5. The parties' earning capability, education and employability.6. The length of absence from the job market.7. Parental responsibilities for the children.8. The time and expense needed to acquire education or training to enable a depended spouse to obtain appropriate employment.9. The financial and non-financial contributions of each spouse to the marriage.10. Equitable distribution.11. Income available and non-financial contributions of each spouse to the marriage.12. The tax consequences of alimony.13. Any other factor which the court deems relevant.
In summary, the main purpose of alimony is to permit the dependent spouse to live the same lifestyle after divorce that she lived during the marriage.
Good Deeds
Time and again, I am often posed with a question of whether or not it is a good idea to add a child’s name to the deed of a family home. Normally, with the client’s interest first and foremost as opposed to the child’s interest, we usually advise that it is better not to add names to the deed to a home. Many clients, however, are concerned about saving their children the inconvenience and cost of estate administration. If a parent chooses to have the family home passed to a child or children upon his or her death, many parents think that it wise to add the name of a child to a deed while he or she is alive hoping to save probate costs and inheritance taxes. This decision should be made on a case by case issue.
Issues, such are these, need to be decided on a case by case issue where the pros and the cons are carefully weighed particularly to the client’s issues. One of the issues that client’s should think about are:
1. Control. This is the paramount consideration when considering this type of issue. Once a person’s name is on a deed, that person’s consent must be obtained before doing anything with the property. For example, if a person thinks he or she may want to sell the house for whatever reason, that person will need to have the child’s consent before that house can be sold. If the child is married, the signature of the child’s spouse on the deed before selling may be necessary or else it would be impossible to obtain title insurance.
2. Consider tax consequences. Federal estate taxes cannot be avoided between non-spouses. Therefore, if the property is valuable enough to be taxed, the tax is unavoidable just by adding the name of a child to the deed. If the property is not of such a high value, there would not be any federal estate taxes anyway.
To add a child’s name to a deed may have potential gift tax consequences depending on the value of the property. It should be noted, however, that it may still be necessary to file a gift tax return even if there is no actual gift tax due because of the combined of the gift/estate tax exclusion.
Also consider that if the child should die first, the client may have to pay estate taxes.
The child should also consider any type of tax issues that may arise. Commonly, to avoid estate taxes, a client may forget the matter of capital gains taxes that the child may have to pay when he or she sells the property. If the property is received as a gift, there is no “stepped up basis” as there is in inheritance. Consequently, if the property value when sold is higher than the basis of the parent donor, the child would have to pay tax on the gain which might well exceed the inheritance tax and probate cost.
3. Do not forget to consider loss of benefits. If the client is eligible for state property tax rebates, a transfer of all or part of the property, even though they remain in possession and pay all expenses themselves, may waive the right to a tax rebate in proportion to the interest transferred.
4. Lastly, consider Medicaid eligibility. When applying for Medicaid long-term care benefits, gift transfers that are made within the last 36 months will be scrutinized and may delay eligibility. Certain regulations allow an applicant to rebut the presumption that a transfer of assets for less than fair market value was for purposes other than avoidance of Medicaid eligibility; however, it can be a difficult and time consuming problem, perhaps requiring administrative hearings.
Therefore, when thinking of adding another name to a deed, careful considerations should be made.
Time and again, I am often posed with a question of whether or not it is a good idea to add a child’s name to the deed of a family home. Normally, with the client’s interest first and foremost as opposed to the child’s interest, we usually advise that it is better not to add names to the deed to a home. Many clients, however, are concerned about saving their children the inconvenience and cost of estate administration. If a parent chooses to have the family home passed to a child or children upon his or her death, many parents think that it wise to add the name of a child to a deed while he or she is alive hoping to save probate costs and inheritance taxes. This decision should be made on a case by case issue.
Issues, such are these, need to be decided on a case by case issue where the pros and the cons are carefully weighed particularly to the client’s issues. One of the issues that client’s should think about are:
1. Control. This is the paramount consideration when considering this type of issue. Once a person’s name is on a deed, that person’s consent must be obtained before doing anything with the property. For example, if a person thinks he or she may want to sell the house for whatever reason, that person will need to have the child’s consent before that house can be sold. If the child is married, the signature of the child’s spouse on the deed before selling may be necessary or else it would be impossible to obtain title insurance.
2. Consider tax consequences. Federal estate taxes cannot be avoided between non-spouses. Therefore, if the property is valuable enough to be taxed, the tax is unavoidable just by adding the name of a child to the deed. If the property is not of such a high value, there would not be any federal estate taxes anyway.
To add a child’s name to a deed may have potential gift tax consequences depending on the value of the property. It should be noted, however, that it may still be necessary to file a gift tax return even if there is no actual gift tax due because of the combined of the gift/estate tax exclusion.
Also consider that if the child should die first, the client may have to pay estate taxes.
The child should also consider any type of tax issues that may arise. Commonly, to avoid estate taxes, a client may forget the matter of capital gains taxes that the child may have to pay when he or she sells the property. If the property is received as a gift, there is no “stepped up basis” as there is in inheritance. Consequently, if the property value when sold is higher than the basis of the parent donor, the child would have to pay tax on the gain which might well exceed the inheritance tax and probate cost.
3. Do not forget to consider loss of benefits. If the client is eligible for state property tax rebates, a transfer of all or part of the property, even though they remain in possession and pay all expenses themselves, may waive the right to a tax rebate in proportion to the interest transferred.
4. Lastly, consider Medicaid eligibility. When applying for Medicaid long-term care benefits, gift transfers that are made within the last 36 months will be scrutinized and may delay eligibility. Certain regulations allow an applicant to rebut the presumption that a transfer of assets for less than fair market value was for purposes other than avoidance of Medicaid eligibility; however, it can be a difficult and time consuming problem, perhaps requiring administrative hearings.
Therefore, when thinking of adding another name to a deed, careful considerations should be made.
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