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ANAND LAW PC > Blog List with Right Sidebar (Page 3)

THE IMPORTANCE OF THE “ESTOPPEL CERTIFICATE”: ENSURING POSITIVE RETURNS FROM THE PURCHASE OF AN INCOME PROPERTY

[vc_row triangle_shape="no"][vc_column][vc_column_text] ABSTRACT [/vc_column_text][vc_empty_space][vc_column_text]An Estoppel Certificate is a document typically used in performing due diligence prior to the purchase of tenant-occupied property.  The purpose is for a lender and purchaser to have written confirmation from tenants of certain terms.  Important amongst these are: the rental amount; security deposit; duration of lease, renewal options; and, as discussed further below, a “subordination” clause. The subordination clause is used to confirm that the tenants have agreed, in their lease, that their interest is subordinate to future mortgages.  Without such confirmation, the tenants’ leases have priority over mortgages that are subsequently obtained.  Furthermore, only a tenant whose...

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A BRIEF OVERVIEW : MECHANIC’S LIENS

[vc_row triangle_shape="no"][vc_column][vc_column_text]In California, contractors who perform work on real property can issue a mechanic’s lien against the property. If a contractor is not paid for the work they performed, they can issue a mechanic’s lien that allows them to collect payment by forcing a sale of the property where the work was done. Subcontractor, material suppliers, and equipment lenders can also issue mechanic’s liens.  However, there are strict procedures and deadlines that must be followed to ensure that the claim is valid. If these are not followed, a mechanic’s lien will not be valid and the right to enforce may...

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HOW TO PUT A LIS PENDENS ON PROPERTY IN CALIFORNIA

[vc_row triangle_shape="no"][vc_column][vc_column_text] A LIS PENDENS IS NOT A LAWSUIT [/vc_column_text][vc_empty_space][vc_column_text]A Lis Pendens is not a lawsuit—it is a document that notifies the world that there is an ongoing lawsuit.  The literal translation of Lis Pendens is “suit pending.” It is also sometimes referred to as a “Notice of Pendency of Action.”  As the name suggests, the purpose is to let others know that there is an active lawsuit. A Lis Pendens is filed with the County Recorder in the county where the piece of property that the law suit involves is located.  When any document is recorded with the County Recorder, it puts...

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DO I NEED A LITIGATION GUARANTEE IN LAWSUITS INVOLVING PROPERTY?

[vc_row triangle_shape="no"][vc_column][vc_column_text]At ANAND LAW, we are both real estate attorneys and real estate brokers.  Combining expertise, we add value, reduce overall cost, and maximize efficiency for our clients involved in real estate disputes.  These disputes often arise between co-owners, neighbors, and lenders.  When parties disagree as to the ownership of real property, quiet title, partition, and foreclosure actions can be used to force a resolution.  Examples of these types of disputes include disagreement as to who holds title or how much they hold, and disagreement as to the the priority of liens.  In any of these types of disputes, it is...

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DON’T GIVE AWAY YOUR IP UNLESS YOU MEAN TO – AVOIDING LICENSES WITHOUT AGREEMENTS : PUT IT IN WRITING.

[vc_row triangle_shape="no"][vc_column][vc_column_text]An implied license does not require any actual agreement—it arises solely from conduct and serves to allow others to use your intellectual property (“IP”).  There is no requirement that even a verbal understanding was reached.  Rather, an implied license is a legal concept that is created solely by the actions of parties and does not require any intention to allow such use. The implied license originated as a concept in patent law, and was then adopted in copyright cases.  It is now also applicable to the right of publicity. Generally, an implied license will be found where the following occurred: At...

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USURY LAW (LIMITATIONS ON INTEREST RATES CHARGED ON LOANS)

[vc_row triangle_shape="no"][vc_column][vc_column_text]The California Constitution prohibits loans that are made primarily for personal, family or household purposes from having interest rates above 10% per year.  This is California’s general usury law.  However, there are many exceptions. First, as implied from the above, loans made for business purposes are not capped at 10% interest (although there are other caps).[/vc_column_text][vc_empty_space][vc_column_text] HOME LOAN EXEMPTION [/vc_column_text][vc_empty_space][vc_column_text]Second, a loan that is taken out to be used primarily for buying a home (i.e. a mortgage) or improving a home (i.e. a construction loan) are not considered loans for personal, family or household purposes, and thus are not capped at 10%...

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REDUCING PRINCIPAL BALANCE & REMOVING MORTGAGES (FIRST AND JUNIOR) IN BANKRUPTCY

[vc_row triangle_shape="no"][vc_column][vc_column_text] CRAM DOWNS & LIEN STRIPPING (REMOVAL) [/vc_column_text][vc_empty_space][vc_column_text]‘Cramming down’ refers to reducing the amount of the lien to the market value — in other words, if a mortgage balance is greater than the market value of a property, the balance can be reduced down to the market value amount.  Cramming down of liens can be done through Chapter 11 on properties that are not a primary residence.  Liens that may be crammed down include mortgage, HELOC (home equity line of credit), HOA (Homeowners’ Association), and judgment. In a Chapter 11 bankruptcy, you can also remove fully unsecured liens from your rental properties (i.e....

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REAL PROPERTY VALUATIONS IN CHAPTER 11 AND 13 BANKRUPTCY PROCEEDINGS

[vc_row triangle_shape="no"][vc_column][vc_column_text] Real property valuations are used in Chapter 11 and Chapter 13 bankruptcy proceedings to determine if liens are unsecured or secured, and thus whether or not they can be removed.  Valuations are also used to determine if the debtor (the filing party) falls within the debt eligibility limits—if a lien is fully unsecured, it will go toward the unsecured debt limitation, and if it is fully secured or partially secured, it will go toward the secured debt limitation limit. Property values change constantly, making a critical question, when does the court value the property for the purposes stated above?  Unfortunately,...

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HOW WILL BANKRUPTCY AFFECT MY CREDIT SCORE?

[vc_row triangle_shape="no"][vc_column][vc_column_text]This depends on a variety of factors, including what your score currently is, what chapter you file for, and if you successfully complete your bankruptcy.  While filing for bankruptcy may lower a credit score, it will not necessarily do so. In fact, if you already have a low credit score, filing can actually increase your score, especially after successful completion of a Chapter 13 or Chapter 11 bankruptcy plan in which you pay off some of your debt. Chapter 7 bankruptcy can also, in certain instances, increase a low credit score, after successful discharge.  It is also important to...

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BANKRUPTCY : CHAPTER 13 DEBT ELIGIBILITY LIMITS

[vc_row triangle_shape="no"][vc_column][vc_column_text]As of April 2019, in order to be eligible to file for a Chapter 13 Bankruptcy (for individuals only), you must owe less than $1,257,850 in liquidated, noncontingent secured debts, and less than $419,275 in liquidated, noncontingent unsecured debts.  11 U.S.C. §109(e).  The debt limitations are adjusted every 3 years, with the next adjustment set to occur in 2022.  11 U.S.C. §104(b). Secured debts include home mortgages, judgment liens, and car loans.  Unsecured debts include credit card bills, medical bills, and personal loans (if a personal loan is secured by property, it will count towards the secured debt limitations). It is important to keep in mind that a Chapter...

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