Author: Carrie B. Reyes

Unlimited lease renewal periods must be stated in lease agreement

Facts: A tenant entered into a commercial lease agreement. The agreement provided for the tenant to renew the lease, though it did not specify how many times the tenant could exercise the option to renew, and included provisions indicative of a short-term lease. The tenant renewed the lease at the end of the first term, then attempted to renew again at the end of the second term. Claim: The landlord sought to terminate the lease, claiming he was not obligated to provide another renewal since the original lease did not explicitly offer an unlimited number of renewals, and the...

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Lender’s possession of note and contact information on the NOD not required to start foreclosure

Facts: A homeowner took out a loan, executing a note secured by a trust deed, then later went into default. The trust deed along with all beneficial interest was assigned to a new lender, though the physical note was not assigned. The new lender filed a notice of default (NOD) and scheduled a trustee’s sale. Claim: The homeowner sought to stop the trustee’s sale, claiming the new lender had no right to foreclose since it did not physically possess the note. Counter claim: The new lender claimed physical possession of the note was not required to initiate foreclosure since...

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Put away your put-backs, Frannie

Originating a home loan imposes a degree of risk on the lender, the stakes of which are made all the worse by Fannie Mae’s and Freddie Mac’s (collectively Frannie’s) strict punishment for underwriting flaws. If a lender makes a mistake on the loan documents it submits to Frannie, the lender is forced to repurchase the loan from Frannie, a process they call a put-back. These mistakes include misrepresenting (intentionally or unintentionally) the home’s appraised value or the homeowner’s creditworthiness. This repurchase rule is essentially a put option included in standard agreements between lenders and Frannie. When exercised by Frannie...

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Frannie participates in California cramdown program

Fannie Mae and Freddie Mac (collectively Frannie) will soon participate in California’s Principal Reduction Program (PRP). This reluctant change of heart was prompted by the announced June 2012 removal of the rule requiring lenders to match any funds PRP offers homeowners. PRP has been around since February 2011 as one of the federally funded efforts of Keep Your Home California, but has seen little bank participation due to the requirement forcing lenders to match any funds PRP provides a homeowner receiving a principal reduction, otherwise known as a cramdown. To qualify for PRP, the homeowner must have a mortgage...

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Agents: what’s your rank?

Do you support a meaningful public ranking of real estate agents in your area? No (73%, 88 Votes) Yes (27%, 33 Votes) Total Voters: 121 Do you know that feeling, on the playground, when your classmates are picking teams and all you can do is stand there, waiting for your name to be called? It’s kind of the same feeling agents get when visiting NeighborCity.com, especially if the visitor is a real estate agent who doesn’t meet the site’s three-legged standard. The third-party web site combines data from multiple listing services (MLSes) across the country as well as other third-party aggregators, providing home listings and information about communities. It also ranks real estate agents and guides buyers to the “best agent” to assist buyers in purchasing their dream home. Agents are ranked based on how many properties they have listed and sold, how long their listed properties remained on the market and how the selling price compared to the listing price. Each agent is classified by property specialization (their experience with condominiums, multi-family housing, commercial property and even land), and given a number between 1 and 100 (100 being the cream of the crop). Sounds great! Wait, really? Currently, NeighborCity is facing lawsuits from two MLSes for using their information without permission, though NeighborCity claims as a registered brokerage it has permission to use MLS data on its web...

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