Real Estate News

I recently discovered the subject of a “Materialmen lien”. It is similar to a car “mechanics’ lien” and is a legal way of placing a claim against another person’s real estate for unpaid work/services performed by a contractor. It is used by general or other special contractors (remodeling, roofing, paving, plumbing, electrical, HVAC, and other services) to file claims against customers for which services and/or materials were performed/delivered, but never paid.

The “rip-off” to the service performer is two-fold:

(One) The fact that these liens have expiration periods (seriously – they do) and don’t remain in effect until paid or cancelled.

(Two) The fact that if they do expire while remaining unpaid, the damaged party may forget about the lien, may have to refile the lien, or may have to expend time and resources to file a lawsuit (that may require the services of an attorney) either in small claims court (generally for charges less than $10,000-15,000, depending on the jurisdiction) or another court to obtain a judgment that may never get paid. (Yes, some debts never get paid even if a legal judgment is awarded against a customer.)

Note: The Cobb County Magistrate Court is also referred to as small claims court. You can file a claim for which you are seeking $15,000.00 or less. If your claim exceeds $15,000.00 principal, the Magistrate Court does not have jurisdiction (the legal authority) to hear your case, and it must be filed in another court; such as, State Court or Superior Court.

I never knew a claim for unpaid services would ever expire – really?

Some liens are for hundreds of thousands of dollars. I’ve noticed many are against healthcare related facilities or operations.

Here’s what the current 2014 Official Code of Georgia (O.C.G.A.) says about these liens:

(a) The following persons shall each have a special lien on the real estate, factories, railroads, or other property for which they furnish labor, services, or materials:

(1) All mechanics of every sort who have taken no personal security for work done and material furnished in building, repairing, or improving any real estate of their employers;

(2) All contractors, all subcontractors and all materialmen furnishing material to subcontractors, and all laborers furnishing labor to subcontractors, materialmen, and persons furnishing material for the improvement of real estate;

(3) All registered architects furnishing plans, drawings, designs, or other architectural services on or with respect to any real estate;

(4) All registered foresters performing or furnishing services on or with respect to any real estate;

(5) All registered land surveyors and registered professional engineers performing or furnishing services on or with respect to any real estate;

(6) All contractors, all subcontractors and materialmen furnishing material to subcontractors, and all laborers furnishing labor for subcontractors for building factories, furnishing material for factories, or furnishing machinery for factories;

(7) All machinists and manufacturers of machinery, including corporations engaged in such business, who may furnish or put up any mill or other machinery in any county or who may repair the same;

(8) All contractors to build railroads; and

(9) All suppliers furnishing rental tools, appliances, machinery, or equipment for the improvement of real estate.

(b) Each special lien specified in subsection (a) of this Code section may attach to the real estate of the owner for which the labor, services, or materials are furnished if they are furnished at the instance of the owner, contractor, or some other person acting for the owner or contractor and shall include the value of work done and materials furnished in any easement or public right of way adjoining said real estate if the work done or materials furnished in the easement or public right of way is for the benefit of said real estate and is within the scope of the owner’s contract for improvements to said real estate.

(c) Each special lien specified in subsection (a) of this Code section shall include the amount due and owing the lien claimant under the terms of its express or implied contract, subcontract, or purchase order subject to subsection (e) of Code Section 44-14-361.1.

(d) Each special lien specified in subsection (a) of this Code section shall include interest on the principal amount due in accordance with Code Section 7-4-2 or 7-4-16.

Another source of information.

References to products and services are not a specific endorsement, but the user must perform their due diligence and investigate whether the product or service is right for them. I welcome any or all comments that would help others.

If you know how, please tell your average real estate agent. We need good, reliable, and fair contractors.

It seems that most, if not all, contractors – general or special – perform at variable levels – sometimes good and sometimes terrible…and everywhere in between.

A contractor may perform exceptionally for one client, and fail to show up for another. Or a contractor who messes up for one client will cut the bill to satisfy the customer with a lower price….and those contractors eventually go out of business…and then we’re left with all the variable performers and those others who charge alot and do a good job, but at a premium.

So here’s a few tips to review and choose a good contractor:

• How long have they been ion business and under what names? )Many go under one name until the reputation is tarnished, then they start a business under another name.)
• How long has your crew been with you? (Are they people who you just pick up as day laborers at the local stops?)
• What will be handled by you, your staff, and any subcontractors?
• Worker’s Compensation and liability insurance – tell me your insurance agent’s name & contact info so I can get an insurance certificate before I hire you.
• License – Georgia requires general contractors be licensed.
• What other projects will you work on besides mine, where are they, and what is the projected time to start and finish the project?
• List of references from clients with similar projects?
• How many projects like mine have you completed in the past 12 months?

As you probably already guessed, there is an association of remodeling professionals. National Association of the Remodeling Industry (NARI) is a trade organization of high-quality remodeling professionals including contractors, builders, architects, suppliers, and more. Its members are committed to integrity, high standards, professional education, ethics and market recognition.

Oh, and like I mentioned at the beginning..if you know any good, decent, reliable contractors in the Atlanta metro area – please let me know…I’ve been looking for 20+ years!

Update note 3-28-2015: Calgary put a contractor list together, but will it be maintained up to date, screen consumer feedback, record reviews on contractors, or just list the licensed contractors? And just because a contractor is licensed, it doesn’t mean they do a good job.

References to products and services are not a specific endorsement, but the user must perform their due diligence and investigate whether the product or service is right for them. I welcome any or all comments that would help others.

The State of Georgia, specifically Gov. Nathan Deal, are asking for a magical $1.5 Billion for Transportation…

In fact there is Georgia House Bill #170 on the floor of this year’s legislative session…but what is the money for? Is it just maintaining roads, bridges and existing infrastructure? How much of it is really necessary and how much is to study a rail system that’s never financially sound?

Whether you are buying, selling, or just living in your house, you should take a look at what’s supporting your house….your foundation. And you should have at least one home inspection performed on your property by a professional inspector to identify any foundation issues on your home and if necessary, consult with a structural engineer or other professional qualified to detemine level of concern and develop a solution, and still another contractor to perform a solution.

Slab:

• Look for separation or cracks on the floor to see whether insects or water is entering property. If you are covered by a termite protection system with a company, you can ask them to perform a service inside the home where there are natural openings or cracks discovered in your slab floor. If there is water coming through the floor, then consult a water foundation solution inspector to reveal where water is coming from and develop a solution.
  

• Look under kitchen and bathroom sinks on main floor. I once found a 6″ mound of dirt (i.e., termites) coming through the floor up through the lower under sink cabinet…If you find termites, call your pest control company.
  
  Some comments about slab foundations

Crawl Space:

• If there are vents in your crawlspace, make sure they have screens on them to prevent rodents or insects from accessing the crawlspace.
• Previous rule of thumb was 1 square foot of vent per 150 square feet in crawl space.
• Most inspectors recommend that there be a vent within 3 feet of the corner of the crawl space.
• Vapor Barrier: Usually sections of plastic sheeting material (overlapped by 6-12 inches) laying on top of exposed dirt floor of crawl space blocking moisture from the ground eating away and damaging supports and floor joists under the main floor of the home.
• Insulation installed properly (paper facing toward conditioned space) against your floor between the floor joists to reduce heating/cooling costs. Be sure that if insulation is installed, that it is checked regularly that it remains attached and doesn’t fall away from the flowing and hang or fall to ground.
• Footings under the outside walls or under the center or strategic concrete block or other types of columnar support structures may be sinking, cracked, leaning, mortar eroded, made of wood materials (which can rot or be infested with termites and lose structural integrity) or otherwise unsafe.

Source of water leaks:

Normally, pipes inside the home don’t leak, but you still need to check them. If water is seen inside the home after hard rains, then check area immediately surrounding the perimeter of the home after the rain. It could be as simple as cleaning out your gutters since waterfalls can develop after leaves block flow of water. Normally I have seen splash guards pointed back to the foundation and were never properly turned around to displace water from downspouts away from the home.

• Landscaping the grade of the yard to slope water away from foundation.
  

• Place black corrugated drain tubes to the down spouts to divert water away from the foundation and let water flow somewhere else.

Word for today is – efflorescence: a glistening/reflective growth on interior crawl or basement walls indicating moisture penetration.

Cracks: A few words about cracks…there will be no concrete floor/wall anywhere that will not have cracks…most are relatively minor in nature and due to normal expansion and contraction; shrinkage; settlement; the appropriate mixture of materials (water, cement, gravel, etc…); or normal curing cycle/time of concrete itself. But if the cause can’t be explained by a simple reason, then a professional may need to be consulted.

Abnormal cracks, those identified by a qualified professional inspector, usually reflect the movement or shift of masonry.

Brick mortar: Mortar is the “glue” holding the bricks together. Mortar can disintegrate over time and will require reapplication (repointing) by a masonry professional.

Walls: If you see a wall leaning or cracked and displaced (one section sits further out from wall than the other), then you should call in a foundation expert to discuss solutions.

Floor joists can be over spanned (longer than load can handle) and can bow and cause dip in flooring; or can be split/drilled/cut or notched to compromise structural integrity of the support. Good news is that splicing pieces or replacing the joist itself can be performed.

References to products and services are not a specific endorsement, but the user must perform their due diligence and investigate whether the product or service is right for them. I welcome any or all comments that would help others.

Jobs for Americans and legal immigrants can help strengthen our country and our real estate markets.

Both the Georgia Senate Bill 160 (SB 160) & House Bill 87 (HB 87) passed and were signed into law by Governor Nathan Deal effective 2013. Better known as the Georgia E-Verify law, it requires employers (conveniently excluding small landscaping companies and small housing contractor subcontractors) with 10 or more employees (including any employee working at least 35 hours a week) to use the federal E-Verify system (verifies employees’ work authorization through both the Department of Homeland Security and Social Security Administration databases) not only for services of any kind (except for attorneys) or any sized contractor/subcontractor on any public project. This expands the E-Verify requirement to small businesses contracted to perform labor or services in excess of $2,499.99, ranging from public construction to information technology and accounting services.

The federal E-Verify program is an electronic online system that allows employers to confirm whether their new hires are legally authorized to work in the U.S and was phased in over 3 years to eventually cover small employers.

The new law prohibits any company from working or bidding on public contracts if it does not enroll in E-Verify. Local governments will not grant or renew a business license or permit for a business until it submits an affidavit certifying its enrollment in the E-Verify program or claiming legitimate exemption

References to products and services are not a specific endorsement, but the user must perform their due diligence and investigate whether the product or service is right for them. I welcome any or all comments that would help others.

If anyone claims there are not enough programs out there applicable to low income home buyers, then these options present good information to counter that argument.

If you wish to prevent foreclosure or need assistance with foreclosure regarding housing, please visit HUD approved housing counselors.

References to products and services are not a specific endorsement, but the user must perform their due diligence and investigate whether the product or service is right for them. I welcome any or all comments that would help others.

Just as the title suggests, you pay only the interest, insurance, property taxes, and pmi but no portion of loan principal (i.e., equity) on the mortgage.

Originally used immediately before the GREAT DEPRESSION, these loans were marketed, and still are, toward the people who get large bonuses or someone who wants a real low payment now, a sophisticated investor and jet setter that wants to divert their money that would have gone toward loan principal to investments and other purposes.

Interest-only mortgages also work well for people who plan to stay in their home for only a short period of time, are very disciplined with money, would like to get into a bigger home and impress someone, or anticipate a large annual bonus, or work mostly on commission or otherwise have uneven streams of personal income.

Most interest only loans cover a total period of 30 years. The borrower agrees to a lower interest rate for a specific time period (for example, the first 5 to 15 years). At the end of the specific time period, the loan converts to a conventional loan in which the remainder of the loan is paid off over the rest of the loan term (thereby catching up on principal/equity payments) in addition to the interest, insurance and taxes you were already paying. This usually means a much higher payment.

Other features of Interest Only Loans:

• The interest rate should remain fixed until the loan is required to be paid back.
• There should be no prepayment penalty.
• The interest rate may be higher than the typical 30 year conventional fixed rate.
• The only equity you build is from market appreciation (if there is any).
• The longer you stay in the home, the higher the monthly mortgage payments.
• When you refinance your home, will the interest rate at that time be lower when the initial interest only time period expires?

Questions to ask lender

1. Does the interest rate remain fixed or will it vary with any index, margin or other factor?
2. Is there any prepayment penalty?
3. Will the interest rate be lower when the initial interest only time period expires?
4. How will the principal balance and mortgage payments be affected if I make random contributions toward my principal loan balance during the interest only period?
5. Can I pay my own homeowner’s insurance and property taxes during the loan?

How Interest Only Loans Work

Mold has existed since time began and will continue to live beyond mankind’s extermination.

There – with that said – don’t freak out if you see a little green or black growth around your home.

The Environmental Protection Agency (EPA) says “If the moldy area is less than about 10 square feet (less than roughly a 3 ft. by 3 ft. patch), in most cases, you can handle the job yourself”. Or if you don’t want to or there’s more than 10 square feet of mold growth, you can consult with a professional mold remediation company in your area certified through the Indoor Air Quality Association.

I have consulted knowledgeable authorities and the response is confusing…it’s even confusing to the EPA since they don’t recommend using anything to clean mold but detergent and water – in their EPA clean-up guidelines. Some others advise using bleach, but bleach (so I’ve been told) spreads the mold spores around more…some advise the most effective way to cleaning up any small elements of mold with hydrogen peroxide (not bleach)…and others recommend a vinegar/water mixture…confusing isn’t it? But most experts advise eliminating the source of moisture as an effective remedy for mold control.

After researching several websites, I realized that there were no good instructions or methods to effectively clean small amounts of mold in your home (unless you want to use the teh EPA’s advice and sue the Federal Government if it doesn’t work – good luck with that), because nobody wants to get sued for advising you what to do.

References to products and services are not a specific endorsement, but the user must perform their due diligence and investigate whether the product or service is right for them. I welcome any or all comments that would help others.

Consumer Finance Protection Bureau

Financial Fraud Enforcement Task Force

The FTC protects consumers by stopping unfair, deceptive or fraudulent practices in the marketplace in financial transactions including purchasing homes and getting a mortgage.The FTC conducts investigations and sues companies and people that violate the law.

Wasn’t this supposed to be more simple and less confusing?

What we did was to seemingly replace the FTC and CFPB with the CFPB and FFETF…more alphabet soup…but the FTC is still involved! W-T-F (Wednesday-Thursday-Friday)!

Who is responsible for preventing or reducing mortgage fraud in the United States?

How Crowdfunding Could Help You Invest in Property… Basically, with real estate crowdfunding, you invest your money in a project or real estate portfolio, and you receive earnings in proportion to your stake.

6 Crowdfunding Pitfalls to Avoid

7-15-2015: Real estate crowdfunding trend presents new challenges, opportunities for financial advisers

7-3-2015: http://www.huffingtonpost.com/young-entrepreneur-council/the-promising-future-of-r_b_7657834.html”>The Promising Future of Real Estate Crowdfunding

6-23-2015: Is Real Estate Crowdfunding Right for You?

5-24-2015: Benworth Capital Partners announced a new real estate crowdfunding platform called Fundrageous.

5-21-2015: Crowdfunding Comes to Real Estate: Interview with Patch of Land CEO Jason Fritton.

5-7-2015: Crowdfunding poised to grow real estate investments…to more than $2.5 Billion?

5-6-2015: Real estate crowdfunding company launches at eMerge in efforts tpo raise $50 million

4-29-2015: Home flippers launching entire real estate funds through crowdfunders.

3-18-2015: Crowdfunding picks up for real estate investments. Crowdfunding has been growing – estimated $2.1 billion in 2012.. about $5 billion in 2013…and about $10 billion in 2014…and 2015…expected to double.

3-3-2015: Real Estate Crowdfunding Seen Topping $2.5 Billion in 2015 from about $1 Billion in 2014…real estate industry has >80 active crowdfunding platforms (Realty Mogul, Fundrise LLC, many private businesses/investors, and others)…

2-17-2015: MassVenture (new start-up firm) starts real estate crowdfunding in Texas.

2-13-2015: Crowdfunding continues to grow with RenRen and Fubndrise

1-25-2015: There will be a 2-day Real Estate Crowdfunding Conference during the Real Estate Investors Expo (REI Expo) at the Hilton Anatole, 2201 North Stemmons Freeway in Dallas, Texas on January 24th and 25th.

Crowdfunding is an investment opportunity what allows you to invest small amounts of your money for a return on that investment, but at some level of risk.

There are sites designed to ask friends and strangers for personal financing for vacations, pet operations, personal tragedies or projects like Indiegogo, GoFundMe, Kickstarter, tilt, and others.

But are there any for mortgage loans? Yes and no…

iFunding is a real estate crowdfunding platform connecting investors with developers. iFunding offers two investment options: lending money for a real estate project at a specific interest rate paid by the project’s developer, or purchasing equity in the real estate projects.

California-based Real Estate Crowdfunding Platform, DiversyFund, Commences Major Back-End Development on Platform. DiversyFund connects accredited investors to high-quality pre-vetted real estate investment opportunities.

iFunding, Real Estate Crowdfunding Platform, Raises $1 million for The Bruckal Group to Expand Residential Community

Fundrise is another real estate crowdfunding platform for investors.

Source for some material in this post: https://www.djc.com/news/re/12072682.html

References to products and services are not a specific endorsement, but the user must perform their due diligence and investigate whether the product or service is right for them. I welcome any or all comments that would help others.