Archive for August, 2014
Friday, August 29th, 2014
Because we live in a litigious society, if you are a real estate agent or broker there is always the threat of litigation hanging over your head. Working on a daily basis with contract and legal consequences, we all need to keep vigilant to protect ourselves. If you are named in a lawsuit or go into arbitration proceedings, keep in mind that you may have to pay the full cost of your errors and omissions insurance deductible.
Here are some ways to help you stay away from the arbitration table and out of the courtroom:
1.Â Have your broker review all your contracts. Unfortunately this is not something that is done with every contract in every brokerage, but it should be. Many brokers review the contracts and related documentation towards the end of the sale. If there were any egregious errors or omissions it may be too late at that time. I have often wondered why the local boards who make the rules do not make it a requirement that a broker review every contract before it is sent out. I have seen more poorly written contracts than I can count, and one recently where the buyers’ agents actually designated me as the representative of their client! Needless to say, I make a lot of phone calls to brokers.
You may think you know how to write a contract and you may have many years of experience doing so, but if you are not a lawyer it is a benefit to you to have broker review every time – it could save your behind and your pocketbook.
2.Â Do not draft any addenda without legal or broker advice, as the wording needs to be approved to avoid legal ramifications. Remember, only attorneys are allowed to draft contracts. Most agents freely draft addenda and amendments all the time, but this really needs to stop. There are ways to word changes in order to make sure that the intended result is properly defined and cannot be construed any other way. Many agents may disagree with me here, but we need broker review on any documents related to the contract, because it can be construed as practicing law.
3.Â Never give legal advice to clients. Almost every agent knows that this is a big no-no, but as a lawyer I have personally heard countless agents say things to their clients that either is legal advice or is on the cusp of being classified as such. If a question involves anything about the contract other than general answers (such as expiration dates, how long a contingency period lasts or where to sign, for example), then advise your clients to seek the advice of an attorney.
4.Â Read the contract and all related documentation before your clients sign anything, every time. You might think I am crazy, but I know for a fact that many agents either have never read the documents they have their clients sign, or do not read them often. I know this because I see mistakes all the time. I know it is boring (we lawyers write a lot of words to cover every point), but I promise you that this will benefit both you and your clients.
This comment is timely, as the California Association of Realtors is about to launch a new Residential Purchase Contract. Take the free classes that will be offered to learn about this new contract and how the changes will affect your clients and the way you fill out your contracts. The same goes for all locales and all paperwork. Your association likely always offers classes on learning the proper paperwork you’ll need as a real estate agent. If not, talk with your broker.
5.Â Read through all paperwork after it has been signed to make sure you didn’t miss anything. I don’t think this needs explanation. Let’s just say that I am appalled by things that are left out in contracts all the time…things that likely would have been discovered by proof reading, and certainly by broker overview.
The only way to avoid problems is to be vigilant, and doing so in real estate means understanding all forms, staying educated about changes and ramifications, never giving legal advice, and having all your paperwork reviewed by your broker. The hassle it may create will be nothing compared to being dragged into arbitration or court.
Monday, August 25th, 2014
When buying a home most buyers have a contingency period, a standard 17 days under the California Residential Purchase Contract (RPA), but negotiable by contract for longer or shorter periods. This time is meant for the buyer to conduct investigations and inspections in order to discover information about the home that may affect ownership or present hazards. Buyers can then ask for credit or repairs, or choose whether to remain bound by the terms of the purchase contract if things are discovered that may alter the value of the home. (Check your area contracts and consult with your real estate agent to understand your rights)
Let’s look at some of the types of inspections and investigations that are important during this time:
1. Home inspection. Most buyers have home inspections during the contingency period, and I always recommend them. If buyers hire a skilled inspector, he or she will be able to point out potential problems, issues or hazards that may not be obvious. I have sold homes before that looked to be in fantastic shape, only to learn of issues that needed to be addressed via home inspectors. Inspectors will not only point out possible issues or hazards, but will also recommend the buyers contact specific experts whose expertise goes beyond that of an inspector (for example, if the inspector detects high moisture readings in a room he may recommend a mold specialist).
2. Civil engineer inspection. A civil engineer is a necessary person to call out for certain types of homes, such as those built on cliffs, or where a cracked slab has been noted. If your inspector advises a call to an engineer, or if there is information in the seller disclosures that warrant doing so, I highly recommend taking the advice.
3. Roof inspection. Some home inspectors do not check the roof. Depending on the age of the roof, and any signs of leakage or information indicating such in the disclosures, a roof inspection may be a smart move.
4.Â Contractor inspections/estimates.Â If your home inspection reveals there may be repair issues needed to the structure, or if there is information in the seller disclosures that warrant, you may want to have a licensed contractor come out for an evaluation and estimate; if you are planning on any future additions or structural changes this is also a good idea, so that you are aware of any possible restrictions or code requirements (also see #6 below).
5. Other specialist inspections/estimates – plumbers, electricians, HVAC specialists, etc. A good home inspector will alert you if s/he thinks there is something that needs further evaluation. I highly recommend taking the advice and calling a specialist. If you are planning on asking the seller for help with repairs or replacement, you will know the cost of doing so, so that you can make sure you ask for the correct amount of credit or repairs.
6. Investigate permit issues. This is an issue of which many buyers and agents are unaware. If the home you are purchasing has had any alterations or additions in the past, you need to see if permits were pulled. Usually you can do this easily with a visit to the County or City offices, or wherever building codes are enforced and records are maintained.
If you know of any past alterations or additions that should have been permitted, but cannot find permits filed, you need to understand your liability down the road – and this can vary depending on local rules and regulations. For example, if there was an addition that wasn’t permitted and down the road you decide to apply for a permit to do some other additions or work, the inspector can site you for the previous additions when s/he comes out to inspect your current project. This means that you could be liable for getting any past unpermitted work up to code. This could cost you a lot of money, so make sure you know what you are up against before you buy.
The importance of the contingency or investigatory period is great. Buyers should exercise discretion and listen to suggestions made by their home inspector and real estate agent on which experts may be needed, as well as pay close attention to what is revealed in seller disclosures. Paying a bit extra for peace of mind that you are buying a sound home (or knowing what issues may be present if you are purchasing a fixer-upper) is well worth it.
Tuesday, August 19th, 2014
There are so many things I love about Carlsbad – the beautiful beaches, the great shopping, terrific restaurants, the Village, the wonderful lagoons and their trails and water sports, and so much more. One thing you may not have known about Carlsbad is that is is home to numerous yoga studios.
If you live in Carlsbad and want to join a yoga studio it used to be that you had to drive to Encinitas or elsewhere, or suffer through yoga classes at a gym (unless it has a separate yoga room this can be a loud, smelly experience with an instructor that often does not compare to those at a yoga studio).
In the last year or so there have been multiple studios that have opened up around town, giving people lots of choices. Here are the local yoga studios that will satisfy the yogi in you:
2653 Gateway Rd., Carlsbad, CA 92009
Phone number (760) 602-0020
– This is my personal yoga studio and I love it. Great instructors, nice clean studio, flexible schedule. Located in fantastic Bressi Ranch town center. $39 for your first month, unlimited yoga. This is not a heated class studio, and temperatures are usually 80Ëš
* Dedicated yoga-only studio
Mantra Yoga (& juice bar)
5617 Paseo Del Norte, Carlsbad, CA 92008
Phone number (760) 655-3277
-I’ve heard wonderful things about this studio. Great location across from the Carlsbad Outlets. They have a cupon on their site for $10 for 10 classes for new students. Lots of hot classes, so if that’s your thing you will like it there.
* Dedicated yoga-only studio
6120 Paseo Del Norte
Carlsbad, CA 92011
Phone number (760) 931-1223
– Nice schedule and great teachers. $19 for first 10 day trial, unlimited classes (new students only)
* Dedicated yoga-only studio
2712 Gateway Rd
Carlsbad, CA 92009
Phone number (855) 484-7348
– This is not a dedicated yoga studio, but offers all kinds of classes – barre, boot camps, strength and conditioning and a gym. Check their site for new student specials.
4509 Adams St.
Carlsbad, CA 92008
– This is a completely different but amazing way to practice yoga – out on paddle boards in the lagoon! I haven’t tried this yet but have heard rave reviews.
1905 Calle Barcelona
Carlsbad, CA 92009
Phone number (760) 274-6332
– Located in The Forum shopping center, offering two yoga rooms, and full locker room and shower facilities
*Dedicated yoga-only studio
Peace, Love and Yoga
2588 El Camino Real
Carlsbad, CA 92008
Phone number (877) 311-7744
– New student special 10 classes for $10. Mostly heated classes.
– Dedicated yoga-only studio
Carlsbad Village Yoga and Fitness
2801 Roosevelt St
Carlsbad, CA 92008
Phone number (760) 893-9251
– Various membership options
*Not a yoga-only dedicated studio
3043 Harding St
Carlsbad, CA 92008
Phone number (760) 720-9642
– New student special $40 for first month, unlimited yoga
*Dedicated yoga-only studio
Thursday, August 14th, 2014
If you are a buyer looking for a home, or if you plan to do so soon, there are a few things you need to be aware of that could kill your chances of getting a loan. Although I am not a mortgage professional, because I work closely with them on a daily basis I felt it important to share some tips with those who are planning a future purchase and need to secure a loan. Many lenders pull credit and also ask for account statements again right before closing, so be careful.
Here are the most important things to avoid in order to secure a loan:
- Do not quit your job, change industries or start a new company (this alters your tax status and you will not be able to provide 2 years of steady employment history, as the clock starts ticking all over â€“ I personally had this happen and had to wait 2 years to refinance)
- Do not cosign on a loan with anyone (you will be 100% responsible for it if the other person defaults)
- Do not switch from a salaried job to one with a commission.
- Do not transfer large sums of money between bank accounts.
- Do not forget to pay your bills, even if there are some in dispute
- Do not open new credit card accounts, even if it will save you money
- Do not accept a cash gift without filing the proper “gift” paperwork
- Do not make random, undocumented deposits into your bank accounts
- Do not purchase a new car or trade up to a pricier lease (in fact, it is advisable not to trade any lease until your loan has closed, even if it lowers your payments)
- Do not purchase any big ticket items like furniture or window treatments â€“ you need to be patient and wait until you have closed escrow
The best advice when applying for a home loan is to avoid spending on anything that is unnecessary before and while the loan is being processed. Plan to eat at home and be frugal for the short period. Most importantly, speak with a mortgage professional, get preapprovedÂ and make a plan so you can work closely with your real estate agent to stay within your boundaries. It will be well worth it in the end!
Monday, August 11th, 2014
Welcome to 1500 Sapphire Drive in Carlsbad, an impeccably maintained home with over $130,000 in remodeling and upgrades. Nestled within a gated hilltop community less than two miles from the ocean, this home has been lovingly cared for by the original owners. Come and see for yourself what the coastal good life is all about!
â€¢Â Offered at $790,000
â€¢Â 3 bedroom +loft/optional 4th bedroom, 2.5 bathroom home, 2284 square feet
â€¢Â View lot! Hills, golf course, canyon, and out to the mountains
â€¢Â Complete kitchen remodel several years ago includes stainless LG appliances, custom granite counters, beautiful custom cabinetry with slider shelving, travertine tiled backsplash and flooring, large eat-in island and under-cabinet lighting
â€¢ Downstairs master suite complete with French doors to the backyard (with adjustable operable panels), stunning built-in entertainment center with shelving, ceiling fan, Plantation shutters, custom paint
â€¢ Gorgeous remodeled master bath with large sunken tub, travertine tiled dual head shower, Grohe fixtures, high-end Italian glass lighting fixtures, decorative windows, seated vanity
â€¢ Plantation shutters, crown molding throughout, thick baseboards downstairs
â€¢ Hardwood flooring downstairs and on the stairway
â€¢ Upstairs view balcony with French doors
â€¢ Large loft upstairs â€“ possibilities are endless, or can be converted to 4th bedroom
â€¢ Tasteful low-maintenance backyard with plenty of room for seating, plus seating wall, outdoor kitchen (sink, refrigerator) and fountains
â€¢ Spacious front patio and beautifully landscaped entrance
â€¢ Epoxy garage with built-in storage and large fire safe
â€¢ Air conditioning
â€¢Â Located in a hilltop gated community less than 2 miles from the ocean
â€¢Â Low HOAs, no mello-roos, community pool/spas and tot lots, Carlsbad schools
If you are looking for a pristine home that has been upgraded, extremely well-cared for and is truly in move-in condition, with views and coastal breezes, in a gated community, plus Carlsbad schools…this is it!
Â Please contact me if you are interested in this property or would like further information! Rachel LaMar, Broker, LaMar Real Estate 760-310-9466. CA BRE license number 01399682 MLS #140044087
To see more photos, video and community informationÂ click here.
Thursday, August 7th, 2014
The marketing pieces I receive in the mail on a daily basis amaze me…but not in a good way. It feels as if as the world gets more and more technologically savvy,people become lazy and less professionalâ€¦real estate agents are not the exception (in fact, they are one of the biggest culprits). Your first point of contact with a potential client, whether via your website, an ad, email, video or mailer, is the only first impression you get to make. If you lose the client at that point you usually do not get a second chance.
Â The good news is that it is not difficult to be professional â€“ it just takes a little more effort and patience. Here are the best ways to make sure your marketing materials make you look professional:
1. EDIT. I cannot say enough about the necessity of editing, and I have written entire blogs dedicated to its importance. Honestly, some of the nice glossy pieces I get in the mail every day from real estate agents look horribleâ€¦ the information presented is useful, but many are filled with spelling and grammatical errors, and poor quality photographs. If you are a real estate agent who wants to be seen as a professional, you need to be able to demonstrate that you understand the English language.
There is nothing more frustrating than reading these poor marketing pieces. Many come from â€œbigâ€ area agents who spend lots of money on advertising. With all that money youâ€™d think theyâ€™d hire an editor. If you canâ€™t afford to do that then you need to have several educated people check over whatever you send out, before you do so.
2. Preparation. Just like a face-to-face meeting with a client, you need to show you are prepared through your marketing materials. Your marketing pieces reflect your preparation and attention to detail. If it is sloppy, has grainy images and typos/grammar errors, that is a reflection on your work ethic (even if in reality you are a hard and dedicated worker). Take the time to lay out the piece and get a proof before printing anything in bulk. It takes extra time and may cost a bit more, but it is time and money well spent.
3. Appearance. I donâ€™t care what anyone tells you to the contrary â€“ if you want to be perceived as a professional you need to dress the part. Showing property in your gym clothes might be convenient, but it doesnâ€™t portray a professional image, and the same rule should apply in your marketing. It doesnâ€™t matter if the recipient is a casual person or is coming from the gym herself. You should always dress professionally â€“ it is not only a statement that you care and that your clientsâ€™ needs are important to you, but also that you take your job seriously.
In marketing, as in everything you do to promote your brand and your services, there should be no corner cutting. What you put out there is a direct reflection on yourself, your business ethic and your ability to represent your clients professionally.
Friday, August 1st, 2014
If you live in an HOA community in California, you’d better start collecting your change. California Assembly Bill 698 could take responsibility for exclusive use common areas away from home owner associations, and place it in the laps of homeowners. It is imperative to understand the proposed changes, as it looks like they may soon take effect.
The bill rewritesÂ Civil Code section 4775, which specifies who pays to maintain, repair and replace identified areas of residential developments governed by homeowner associations called exclusive use common areas. Under the new rules HOAs will be able to redefine the maintenance requirements for these areas, and homeowners will have to comply -Â the HOA will be able to bring action against the homeowner for failure to do so. This will give much power to HOA boards and could lead to abuse.
Here is how certain areas are defined under current rules (check your HOA documents to see if you have exclusive use common areas):
Common areas – the associations are liable for maintaining these areas, which typically include areas that server the entire development such as pools, grassy areas,Â play areas or parks, and roofs if the development is a condo or townhome.
Separate interest areas – these areas are usually the responsibility of the homeowner, and include the interior of townhomes or condominiums.
Exclusive use common areas – such areas are considered “appurtenant to” to the property (meaning they are attached or considered to go along with the property), and these areas tend to be maintained by the HOAs currently. They usually include areas that are useable by some owners, but not all, such as a deck or patio.
Homeowners who do not comply under the new rules will be subject to assessments or fines by the HOAs. They may also be able to place liens on the properties and force sales where there is no compliance with maintenance requirements. If homeowners are unable to pay, this could lead to foreclosure (worse case scenario).
How to prevent new changes in your HOA policy: The only way you can prevent such changes from occurring in your HOA community is to get involved and vote against any changes that will give broad power to your HOA. You need to be very aware and very involved – you cannot rely on others to deal with this problem because you will need a majority vote and there is strength in numbers.
You also should learn as much as you can about common area and exclusive use common areas boundaries defined in property surveys of your home and development, including any government definitions. The more you know, the better empowered you will be to make a difference in your community and your wallet. To see the bill, click here.