ARTICLES & NEWS

REAL ESTATE TRANSACTIONS ARTICLES

Foreclosure auction

Foreclosure Proceeds After HOA Foreclosure

By Christopher Combs | September 6, 2020

Question: Thank you for your recent column on the right of an HOA to foreclose on a home for nonpayment of $3,000 in delinquent HOA dues. In your example the house was owned free and clear, and was valued at $185,000. My question is, after the foreclosure sale, would the HOA get the entire $185,000 foreclosure sale proceeds, or would the HOA only get the $3,000 delinquent HOA dues, and the homeowner would get the remaining $182,000? Answer: There are sophisticated investors who daily look at foreclosure notices that schedule foreclosures of homes. These investors then compare the value of…

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Mediator

Seller and Buyer Should Mediate Before They Litigate

By Christopher Combs | August 30, 2020

Question: We signed a purchase contract to buy an expensive home in Carefree. We deposited $25,000 earnest money. Because of the COVID-19 crisis, however, our financial situation significantly changed, and we no longer want to buy the home. We agreed with the seller to cancel the purchase contract, and we are willing to forfeit the $25,000 earnest money. The seller has refused, however, to accept the $25,000 earnest money. Instead, the seller claims that, since the purchase contract was signed and escrow was opened, the value of the home has diminished at least $100,000 due to the COVID-19 crisis. The…

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Real Estate License

Short-Term Rentals Don’t Require Real Estate License

By Christopher Combs | August 9, 2020

Question: We live in a neighborhood of high-end homes in south Chandler. One of our neighbors has done short-term rentals of her own home for the past two years. She has recently started doing short-term rentals for two other high-end homes in our neighborhood. She is collecting money, paying for repairs, and advertising the homes as short-term rentals. We own a property management company that manages more than 100 rental homes with mostly one-year or two-year leases. Our property management company is required to have a real estate license. We know that our neighbor does not have a real estate…

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homebuild and blueprint

Home Builders Require Mediation And Arbitration

By Christopher Combs | August 2, 2020

Question: We signed the builder’s purchase contract to buy a new home in the San Tan Valley. The builder’s sales agent made numerous false statements, especially in regard to the upgrades that were available in the home. The “bottom line” is that we canceled the purchase contract and demanded our $20,000 earnest money back. The builder refuses to give the $20,000 earnest money back to us. In addition, the builder demands reimbursement for the $28,000 cost of upgrades that the builder says are worthless to any new buyer of the home. Under the builder’s purchase contract we are required to…

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Mortgage repayment failure

Statute of Limitations for HELOCs

By Christopher Combs | July 26, 2020

Question: When we bought our Chandler home in 2006, we got a 30-year first mortgage with Bank of America, and a Wells Fargo $100,000 second mortgage home equity line of credit (“Wells Fargo HELOC”). We used this $100,000 for a swimming pool and for landscaping in our back yard. In 2011 we both lost our jobs and we had financial difficulties. Although we were able to keep our first Bank of America mortgage current, we stopped paying our Wells Fargo HELOC. Last week we received a letter from an attorney that our Wells Fargo HELOC balance is $160,000, and that…

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Text Message

Texts Between Seller and Buyer can be a Purchase Contract

By Christopher Combs | July 5, 2020

Question: We wanted to buy a beautiful home in Sedona. The problem during the negotiations for the purchase of this home was that we live in Phoenix and the seller lives in Texas. Neither of us were represented by brokers. Most of our negotiations with the seller were by texts between the seller and us. The major terms of the purchase contract were in these texts: the purchase price, the closing date, the name of the escrow company, and that there would be no financing. Each of the seller’s texts had the seller’s name and address at the bottom of…

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Garage

Confirm Not Only Permit Issued But Construction Completed

By Christopher Combs | June 21, 2020

Question: When we purchased our East Valley home, the Seller’s Property Disclosure Statement (“SPDS”), line 150, said that there was a permit from the City of Chandler for the construction of the 2,000-square-foot detached garage. The SPDS, line 155, said that the detached garage had been “completed.” We want to use this detached garage for our collector cars and for an art studio. We recently learned, however, that although a permit from the City of Chandler was granted to build the detached garage, there was never a certificate of completion for the detached garage from the City of Chandler. For…

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Baby room

Son Entitled to Appreciation in Home’s New Value

By Christopher Combs | May 3, 2020

Question: My son and his girlfriend bought a home in North Phoenix three years ago as tenants in common. They each contributed $15,000 for the down payment, and my understanding is that they have been splitting the monthly mortgage payments and other home expenses. Last year they had a baby, and they needed another bedroom. We loaned our son $20,000 to add on a bedroom. Although my son and his girlfriend are happy now, what happens if they break up and have to sell the home? Will my son get back from the proceeds the $20,000 cost of the bedroom…

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