This week Texas House Speaker Joe Straus released the 81st Legislature's Interim Committee Charges pertaining to Texas House of Representatives Committees. The charges are varied, and few are unexpected. Interim charges represent the "task assignments" delegated by the Speaker to various House committees which are to be completed during the period between Legislative Sessions.
Of particular importance to real estate interests and real estate attorneys in Texas are the Charges made to the House Committee on Land and Resource Management. That Committee is chaired by Rep. Dennis Bonnen.
The folllowing assignments are contained within Speaker Straus' charges:
1. Evaluate the appropriateness of creating pedestrian-only areas on the public
beaches of the state.
2. Examine unresolved issues relating to eminent domain legislation introduced
during the 81st Legislative Session. Monitor any pending litigation.
3. Examine the granting of easements on state-owned lands, including lands
managed by institutions of higher education and the General Land Office.
4. Study the causes of coastal erosion along the Texas coast. Evaluate current and
alternate funding sources. Review federal programs and their relationship to the
state program.
5. Monitor the agencies and programs under the committee's jurisdiction.
Attorney Trey Wilson - RL Wilson Law
Showing posts with label San Antonio real Estate Lawyer. Show all posts
Showing posts with label San Antonio real Estate Lawyer. Show all posts
16 November 2009
In Texas, persons repairing vehicles and equipment may place workers' liens and even repossess
As a San Antonio lawyer with active real estate and construction law practices, liens are a daily part of my business. When representing landowners or buyers/sellers of real estate, ensuring clear title -- free of liens and encumberances -- is of the utmost concern. Likewise, my general contractor and sub-contractor clients regularly trust me to place or remove mechanics' liens to secure payment for work performed or materials supplied on contruction projects.
Every so often, hoewever, I get a call from an equipment repair facility, automotive mechanic or other service provider inquiring about their lien rights when customers refuse to pay for their services.
In Texas, liens are available to a variety of persons rendering goods and services, including those who perform repairs on vehicles, motorboats, vessels and/or outboard motors. Persons performing such repairs are referred to as "workers," and their lien rights are set-forth in Section 70.001 of the Texas Property Code.
That section not only entitles the repair person to place a lien on the article that was repaired, but also entitles such "worker" to retain POSSESSION of the article until payment is received. Here's the text of the statutue:
Sec. 70.001. WORKER'S LIEN. (a) A worker in this state who by labor repairs an article, including a vehicle, motorboat, vessel, or outboard motor, may retain possession of the article until:
(1) the amount due under the contract for the repairs is paid; or
(2) if no amount is specified by contract, the reasonable and usual compensation is paid.
Many times, people pay for repairs through check or credit card transactions. In these instances, the article that was repaired is released to the owner prior to the repair person actually receiving the funds associated with a purported payment. Nefarious customers might then stop payment, close their account, or simply have their check returned for NSF. In such instances, the statute, again, seeks to protect the rights of the repair person, and even authorizes repossession in certain circumstances:
(b) If a worker relinquishes possession of a motor vehicle, motorboat, vessel, or outboard motor in return for a check, money order, or a credit card transaction on which payment is stopped, has been dishonored because of insufficient funds, no funds or because the drawer or maker of the order or the credit card holder has no account or the account upon which it was drawn or the credit card account has been closed, the lien provided by this section continues to exist and the worker is entitled to possession of the vehicle, motorboat, vessel, or outboard motor until the amount due is paid, unless the vehicle, motorboat, vessel, or outboard motor is possessed by a person who became a bona fide purchaser of the vehicle after a stop payment order was made. A person entitled to possession of property under this subsection is entitled to take possession thereof in accordance with the provisions of Section 9.609, Business & Commerce Code.
But a repair person should be very careful before asserting any right of repossession. This is because repossession is only available under a limited set of circumstanes:
(c) A worker may take possession of an article under Subsection (b) only if the person obligated under the repair contract has signed a notice stating that the article may be subject to repossession under this section. A notice under this subsection must be:
(1) separate from the written repair contract; or
(2) printed on the written repair contract, credit agreement, or other document in type that is boldfaced, capitalized, underlined, or otherwise set out from surrounding written material so as to be conspicuous with a separate signature line.
A repair person who properly asserts a right to repossession may require the owner of the repossessed article to pay for repossession costs, including towing:
(d) A worker who takes possession of an article under Subsection (b) may require a person obligated under the repair contract to pay the costs of repossession as a condition of reclaiming the article only to the extent of the reasonable fair market value of the services required to take possession of the article. For the purpose of this subsection, charges represent the fair market value of the services required to take possession of an article if the charges represent the actual cost incurred by the worker in taking possession of the article.
Again, repossession is available only in limited circumstances. Under certain conditions -- such as when a worker transfers to the repo company a returned check -- the worker may find himself in trouble for attempting repossession.
For that reason, all repair facilities and persons should consult with an experienced attorney PRIOR TO attempting a repossession upon a workers' lien. In addition, the prudent garage or mechanic should have a lawyer who is familiar with liens review their service contract or agreement to ensure that the repair document properly provides notice and authorization for repossession of the article to be repaired.
28 December 2008
11 Face Justice in Mortgage Fraud Scheme -- San Antonio Real Estate Investment Fraud
On a one-block street in Northwest San Antonio, five properties all fell into foreclosure in 2003. When federal investigators began poking around, they tied the properties on Meadow Field near Grissom Road to an Austin-based house-flipping ring.
Eleven members of that 16-person ring -- which includes three real estate agents, an attorney, a mortgage broker and a former Wells Fargo bank officer -- are set to be sentenced today in U.S. District Court in Austin after being found guilty of wire fraud, money laundering and falsifying information on loan documents as part of this scam that hit Austin and that San Antonio neighborhood.
The Austin ring is part of a swelling wave of mortgage fraud that isn't expected to crest until late next year. Texas is among the top 10 states for mortgage abuses, and San Antonio is involved in three such scams so far this year, the Austin case and two San Antonio-based rings under investigation by the Federal Bureau of Investigation. The San Antonio rings used more than 50 people to inflate prices in Stone Oak, Spring Branch and Dallas.
FBI special agents investigating the cases have said that arrests would happen soon this summer. “Typically what happens is incidents are not identified until months after the loans were originated, so many (federal) agencies are just closing cases from 2000 and 2001,” said Tom Chmielewski, vice president of products and strategy at ChoicePoint which owns the Mortgage Asset Research Institute. “I expect the fraud to be at elevated levels for the next couple of years.”
The increased fraud activity has its roots in the housing boom and the popularity of no-documentation loans -- loans where information entered about the background and finances of buyers were not verified. “A lot of it popped up in the last four to five years particularly with no-doc, low-doc loans because nobody was verifying anything,” said Jim Gaines, a research economist at the Real Estate Center at Texas A&M University.
Nationwide, financial institutions reported 46,717 cases of suspicious activity in mortgage lending in fiscal 2007, according to the FBI. That's a 31 percent increase from fiscal 2006, when lenders began to loosen lending guidelines, and a 574 percent increase since fiscal 2003, when the housing boom started to take off. Most of the cases are in Texas, California, Colorado, Florida, Georgia, Illinois, Michigan, Minnesota, New York and Ohio, according to the FBI's 2008 mortgage fraud report. One study by mortgage insurer Radian Group found that 10.5 percent of all mortgages it had insured in Texas in 2007 showed signs of “misrepresentation,” according to Rick Gillespie, Radian senior vice president.
The cases typically feature an appraiser who agrees to provide inflated appraisals for a kickback, and “straw buyers” -- people who rent out their personal information to another person for the purchase of a house with the understanding that home will be sold in a quick flip to another buyer after a few months.
According to the indictment in the case of the Austin-based fraud ring, Austin resident Cornelius Robinson created a company named Billionaires Boys Club Investments Inc. (BBC) and then recruited his wife and former real estate agent Silvia Seelig, Austin lawyer George H. Watson, former Wells Fargo personal banker Doris Ann Hill, and Robinson's uncle and friends to help buy 25 properties using fraudulent practices.
The team falsified addresses and telephone numbers for straw buyers, as well as rental histories, employment histories and bank deposits, according to the indictment. In San Antonio, BBC bought five fourplexes on Meadow Field on Aug. 14, 2001, for $100,000 each and then sold them during the same month to an “unindicted co-conspirator” for $157,000 each. The second buyer sold four of the properties about eight months later to another “unindicted co-conspirator” for $167,000. At some point, the mortgage payments no longer were being paid and lenders foreclosed on all five properties in 2003, according to the court record.
When so many foreclosures happen close together, it can hurt home prices.
Within San Antonio's Great Northwest area, where the Meadow Field properties are located, the median price dropped 2.4 percent in 2004, the year after the five properties were foreclosed, according to the San Antonio Board of Realtors.
In January 2008, 16 people were indicted for having participated in BBC's mortgage scams. Seelig, Watson, Hill and eight other defendants pleaded guilty to charges related to wire fraud, money laundering and making false statements on loans and will be sentenced today.
Robinson went to trial and was convicted of five counts of wire fraud, seven counts of money laundering and nine counts of making false statements on loans, according to the U.S. Attorney's Office. His case is set for sentencing on June 20.
In the two ongoing local investigations, FBI special agent David Rawlings who is leading the investigation, says 54 people committed mortgage fraud to buy 112 houses in Stone Oak, Spring Branch and Dallas.
Because the investigation is ongoing, Rawlings would not give many details about the cases. But he did say that in some instances, the straw buyers bought and flipped homes with the help of two San Antonio-based mortgage brokers. In other cases, a buyer purchased a new home at a discount, but got the builder to falsify the mortgage documents by saying the house was sold for a higher price than it was. After the inflated loan closed, the buyer paid the builder a kickback.
Rawlings explained that in San Antonio, several of the cases involved new construction. San Antonio overbuilt homes in 2006 and 2007, and for the past two years, builders have started fewer houses in an effort to sell off their existing inventory. Such scenarios can create a climate ripe for fraud, Rawlings said. “Where there's newer construction, you have a lot of desperate sellers and builders,” Rawlings said. “The losses have been up to $400,000 and $500,000 on some million-dollar homes.”
Such fraud techniques are not exclusive to Texas. One of the largest publicized cases this year happened in Chicago, where lenders lost an estimated $25 million on more than 150 properties after loan officers, processors, a CPA, a real estate agent and developers falsified employment, assets and rental history for straw buyers.
Real estate and foreclosure experts say the frenzy of the housing boom created the atmosphere where such widespread fraud could flourish. The fraud mushroomed as lenders faced rising pressure to increase sales. “I've talked with loan officers who routinely said they'd deny a loan and their bosses would come back and say, ‘Approve it,'” said Rick Sharga, vice president of marketing at RealtyTrac Inc. that monitors foreclosure activity. “When the loan officer said, ‘The loan doesn't fit our lending standards,' (then) the supervisor would say, ‘That's OK. Somebody will buy it.'”
From the SA Express News.
San Antonio Attorney Trey Wilson handles real estate fraud lawsuits, including suits involving real estate investors. As reported by Scene in SA Magazine, Wilson was recently voted by his peers as one of San Antonio's Best Real Estate Litigation Attorneys. He handles a variety of real estate claims and lawsuits, including fraud claims related to residential and commercial properties. As a licensed real estate Agent, Trey Wilson is a San Antonio lawyer who is uniquely attuned to real estate transactions and the duties of the parties to such transactions. He routinely represents Out-of-State investors who have invested in texas real estate. Trey Wilson is the principal of R L Wilson, P.C. Law Firm. he may be reached at 210-223-4100 or www.sa-law.com
Eleven members of that 16-person ring -- which includes three real estate agents, an attorney, a mortgage broker and a former Wells Fargo bank officer -- are set to be sentenced today in U.S. District Court in Austin after being found guilty of wire fraud, money laundering and falsifying information on loan documents as part of this scam that hit Austin and that San Antonio neighborhood.
The Austin ring is part of a swelling wave of mortgage fraud that isn't expected to crest until late next year. Texas is among the top 10 states for mortgage abuses, and San Antonio is involved in three such scams so far this year, the Austin case and two San Antonio-based rings under investigation by the Federal Bureau of Investigation. The San Antonio rings used more than 50 people to inflate prices in Stone Oak, Spring Branch and Dallas.
FBI special agents investigating the cases have said that arrests would happen soon this summer. “Typically what happens is incidents are not identified until months after the loans were originated, so many (federal) agencies are just closing cases from 2000 and 2001,” said Tom Chmielewski, vice president of products and strategy at ChoicePoint which owns the Mortgage Asset Research Institute. “I expect the fraud to be at elevated levels for the next couple of years.”
The increased fraud activity has its roots in the housing boom and the popularity of no-documentation loans -- loans where information entered about the background and finances of buyers were not verified. “A lot of it popped up in the last four to five years particularly with no-doc, low-doc loans because nobody was verifying anything,” said Jim Gaines, a research economist at the Real Estate Center at Texas A&M University.
Nationwide, financial institutions reported 46,717 cases of suspicious activity in mortgage lending in fiscal 2007, according to the FBI. That's a 31 percent increase from fiscal 2006, when lenders began to loosen lending guidelines, and a 574 percent increase since fiscal 2003, when the housing boom started to take off. Most of the cases are in Texas, California, Colorado, Florida, Georgia, Illinois, Michigan, Minnesota, New York and Ohio, according to the FBI's 2008 mortgage fraud report. One study by mortgage insurer Radian Group found that 10.5 percent of all mortgages it had insured in Texas in 2007 showed signs of “misrepresentation,” according to Rick Gillespie, Radian senior vice president.
The cases typically feature an appraiser who agrees to provide inflated appraisals for a kickback, and “straw buyers” -- people who rent out their personal information to another person for the purchase of a house with the understanding that home will be sold in a quick flip to another buyer after a few months.
According to the indictment in the case of the Austin-based fraud ring, Austin resident Cornelius Robinson created a company named Billionaires Boys Club Investments Inc. (BBC) and then recruited his wife and former real estate agent Silvia Seelig, Austin lawyer George H. Watson, former Wells Fargo personal banker Doris Ann Hill, and Robinson's uncle and friends to help buy 25 properties using fraudulent practices.
The team falsified addresses and telephone numbers for straw buyers, as well as rental histories, employment histories and bank deposits, according to the indictment. In San Antonio, BBC bought five fourplexes on Meadow Field on Aug. 14, 2001, for $100,000 each and then sold them during the same month to an “unindicted co-conspirator” for $157,000 each. The second buyer sold four of the properties about eight months later to another “unindicted co-conspirator” for $167,000. At some point, the mortgage payments no longer were being paid and lenders foreclosed on all five properties in 2003, according to the court record.
When so many foreclosures happen close together, it can hurt home prices.
Within San Antonio's Great Northwest area, where the Meadow Field properties are located, the median price dropped 2.4 percent in 2004, the year after the five properties were foreclosed, according to the San Antonio Board of Realtors.
In January 2008, 16 people were indicted for having participated in BBC's mortgage scams. Seelig, Watson, Hill and eight other defendants pleaded guilty to charges related to wire fraud, money laundering and making false statements on loans and will be sentenced today.
Robinson went to trial and was convicted of five counts of wire fraud, seven counts of money laundering and nine counts of making false statements on loans, according to the U.S. Attorney's Office. His case is set for sentencing on June 20.
In the two ongoing local investigations, FBI special agent David Rawlings who is leading the investigation, says 54 people committed mortgage fraud to buy 112 houses in Stone Oak, Spring Branch and Dallas.
Because the investigation is ongoing, Rawlings would not give many details about the cases. But he did say that in some instances, the straw buyers bought and flipped homes with the help of two San Antonio-based mortgage brokers. In other cases, a buyer purchased a new home at a discount, but got the builder to falsify the mortgage documents by saying the house was sold for a higher price than it was. After the inflated loan closed, the buyer paid the builder a kickback.
Rawlings explained that in San Antonio, several of the cases involved new construction. San Antonio overbuilt homes in 2006 and 2007, and for the past two years, builders have started fewer houses in an effort to sell off their existing inventory. Such scenarios can create a climate ripe for fraud, Rawlings said. “Where there's newer construction, you have a lot of desperate sellers and builders,” Rawlings said. “The losses have been up to $400,000 and $500,000 on some million-dollar homes.”
Such fraud techniques are not exclusive to Texas. One of the largest publicized cases this year happened in Chicago, where lenders lost an estimated $25 million on more than 150 properties after loan officers, processors, a CPA, a real estate agent and developers falsified employment, assets and rental history for straw buyers.
Real estate and foreclosure experts say the frenzy of the housing boom created the atmosphere where such widespread fraud could flourish. The fraud mushroomed as lenders faced rising pressure to increase sales. “I've talked with loan officers who routinely said they'd deny a loan and their bosses would come back and say, ‘Approve it,'” said Rick Sharga, vice president of marketing at RealtyTrac Inc. that monitors foreclosure activity. “When the loan officer said, ‘The loan doesn't fit our lending standards,' (then) the supervisor would say, ‘That's OK. Somebody will buy it.'”
From the SA Express News.
San Antonio Attorney Trey Wilson handles real estate fraud lawsuits, including suits involving real estate investors. As reported by Scene in SA Magazine, Wilson was recently voted by his peers as one of San Antonio's Best Real Estate Litigation Attorneys. He handles a variety of real estate claims and lawsuits, including fraud claims related to residential and commercial properties. As a licensed real estate Agent, Trey Wilson is a San Antonio lawyer who is uniquely attuned to real estate transactions and the duties of the parties to such transactions. He routinely represents Out-of-State investors who have invested in texas real estate. Trey Wilson is the principal of R L Wilson, P.C. Law Firm. he may be reached at 210-223-4100 or www.sa-law.com
10 October 2008
Buying Real Estate During The Economic Crisis
Given the current economic crisis -- which appears to be growing global in scope -- has made buying real estate more difficult. Credit is tough to come by, and these days you need a job to buy a house. That is, unless you are in a significant cash position, which doesn't describe most Texans. Most of us need credit, and are having diffculty obtaining it.
The credit crisis continues to grow, and uncertainty looms large. Third quarter 401(k), 457, 403(b) and IRAs have dropped. Savings rates have dropped. Gas prices remain high, and wages low.
With the central banks around the world working in concert to lower interest rates, crashing stock markets in the U.S., Europe & Asia, rising unemployment, a dwindling Peso and a hotly-contested and increasingly-ugly U.S. presidential election, even the most optimistic real estate agents and mortgage brokers are getting nervous.
They say that all real estate (like all politics) is local. So...how does the national/global crisis effect San Antonio homeowners or home buyers? As the U.S. economy falls into a recession, jobless numbers have increased and more than 750,000 American jobs have been lost this year. According to the US Dept. of Labor (Bureau of Labor Statistics) as of the end of September 2008, the national unemployment rate was officially 6.1 percent. The number of unemployed persons is 9.5 million, and over the past 12 months, the number of unemployed persons has increased by 2.2 mil-
lion and the unemployment rate has risen by 1.4 percentage points. Some unemployment experts have sugggested that the true rate of unemployment in the U.S.-- if you factor in those making less money than they were two years ago or working at part-time jobs rather than full-time jobs because they can't find the right situation, those who are underemployed, and those who have just given up looking for a job and have fallen off the rolls -- is approaching 10 percent.
There is a strong nexus between rising unemployment and a faltering real estate market because most lenders will not issue a mortgage loan, unless the borrower can demostrate sufficient incme to make the payments. These days, the income won't come from the stock market or from "flipping." As such, jobs are virtually essential for obtaining a mortgage loan.
In Texas, almost 600,000 people, or 5.0% of the workforce was unemployed in August. This was up from 4.7% in July and 4.1% in April. In San Antonio -- which many claim has been insulated from the housing crisis -- new and existing homes sales have dropped. San Antonio builders started construction on 33 percent fewer homes this (3rd) quarter than they did during the same period last year. Sales of new homes in San Antonio are down 36 percent from last year.
The credit squeeze has reminded banks and mortgage lenders that, while credit scores are perhaps decent indicators of whether a borrower has financial stability, they don't make the mortgage payments. Similarly, FICO scores don't take into account whether someone has substantial savings or cash on hand.
On the other hand, if you have a steady job, demonstrable income, and a good credit score, you may want to talk to your lender about refinancing. Just this morning, Freddie Mac announced that interest rates on 30 year mortgages have dropped to below 6% (5.94% to be exact). So there is some good news. Here's some more:
If you have an adjustable rate mortgages (ARM) tied to United States Treasuries, your interest rate may adjust downward -- maybe even to the 4.5 percent range. How could this happen? If the one year Treasury Bill Index is at 1.5 percent, and you have a 3 percent margin attached to your ARM loan, that adds up to a 4.5 percent interest rate.
If you have an ARM tied to the London Interbank Offered Rate (LIBOR) or some form of interest-only loan, certain lenders will lock-in adjustable rates for a small fee (around $250). Find out when and at what interest rate your loan will adjust to. The cost of converting your ARM to a fixed-rate loan may be well worth the savings to be realized long-term. Plus, any financial certainity you can obtain in today's climate is probably a good thing.
While we all have plenty of reasons to worry, smart home buyers with demonstrable income and good credit can find great deals. If you can whether the storm and stay on top of your mortgage payments, a good buy today could result in a terrific sale once the storm has passed.
As always, prior to obtaining a mortgage loan or entering into a real estate sale/purchase contract, you should consult with an experienced real estate lawyer. San Antonio lawyer Trey Wilson of R L Wilson, P.C. Law Firm has a diverse practice related to real estate, residential, construction, mortgage, landlord-tenant, homeowners association and general litigation. In September 2008, Trey Wilson was named by Scene in SA magazine as one of San Antonio's best real estate litigation attorneys. He can be reached at 210/223-4100 or www.sa-law.com.
The credit crisis continues to grow, and uncertainty looms large. Third quarter 401(k), 457, 403(b) and IRAs have dropped. Savings rates have dropped. Gas prices remain high, and wages low.
With the central banks around the world working in concert to lower interest rates, crashing stock markets in the U.S., Europe & Asia, rising unemployment, a dwindling Peso and a hotly-contested and increasingly-ugly U.S. presidential election, even the most optimistic real estate agents and mortgage brokers are getting nervous.
They say that all real estate (like all politics) is local. So...how does the national/global crisis effect San Antonio homeowners or home buyers? As the U.S. economy falls into a recession, jobless numbers have increased and more than 750,000 American jobs have been lost this year. According to the US Dept. of Labor (Bureau of Labor Statistics) as of the end of September 2008, the national unemployment rate was officially 6.1 percent. The number of unemployed persons is 9.5 million, and over the past 12 months, the number of unemployed persons has increased by 2.2 mil-
lion and the unemployment rate has risen by 1.4 percentage points. Some unemployment experts have sugggested that the true rate of unemployment in the U.S.-- if you factor in those making less money than they were two years ago or working at part-time jobs rather than full-time jobs because they can't find the right situation, those who are underemployed, and those who have just given up looking for a job and have fallen off the rolls -- is approaching 10 percent.
There is a strong nexus between rising unemployment and a faltering real estate market because most lenders will not issue a mortgage loan, unless the borrower can demostrate sufficient incme to make the payments. These days, the income won't come from the stock market or from "flipping." As such, jobs are virtually essential for obtaining a mortgage loan.
In Texas, almost 600,000 people, or 5.0% of the workforce was unemployed in August. This was up from 4.7% in July and 4.1% in April. In San Antonio -- which many claim has been insulated from the housing crisis -- new and existing homes sales have dropped. San Antonio builders started construction on 33 percent fewer homes this (3rd) quarter than they did during the same period last year. Sales of new homes in San Antonio are down 36 percent from last year.
The credit squeeze has reminded banks and mortgage lenders that, while credit scores are perhaps decent indicators of whether a borrower has financial stability, they don't make the mortgage payments. Similarly, FICO scores don't take into account whether someone has substantial savings or cash on hand.
On the other hand, if you have a steady job, demonstrable income, and a good credit score, you may want to talk to your lender about refinancing. Just this morning, Freddie Mac announced that interest rates on 30 year mortgages have dropped to below 6% (5.94% to be exact). So there is some good news. Here's some more:
If you have an adjustable rate mortgages (ARM) tied to United States Treasuries, your interest rate may adjust downward -- maybe even to the 4.5 percent range. How could this happen? If the one year Treasury Bill Index is at 1.5 percent, and you have a 3 percent margin attached to your ARM loan, that adds up to a 4.5 percent interest rate.
If you have an ARM tied to the London Interbank Offered Rate (LIBOR) or some form of interest-only loan, certain lenders will lock-in adjustable rates for a small fee (around $250). Find out when and at what interest rate your loan will adjust to. The cost of converting your ARM to a fixed-rate loan may be well worth the savings to be realized long-term. Plus, any financial certainity you can obtain in today's climate is probably a good thing.
While we all have plenty of reasons to worry, smart home buyers with demonstrable income and good credit can find great deals. If you can whether the storm and stay on top of your mortgage payments, a good buy today could result in a terrific sale once the storm has passed.
As always, prior to obtaining a mortgage loan or entering into a real estate sale/purchase contract, you should consult with an experienced real estate lawyer. San Antonio lawyer Trey Wilson of R L Wilson, P.C. Law Firm has a diverse practice related to real estate, residential, construction, mortgage, landlord-tenant, homeowners association and general litigation. In September 2008, Trey Wilson was named by Scene in SA magazine as one of San Antonio's best real estate litigation attorneys. He can be reached at 210/223-4100 or www.sa-law.com.
07 October 2008
WHAT EXACTLY IS TITLE INSURANCE?
In Texas, the two most common types of title policies are “mortgagee policy of title insurance,” which protects lenders, and “owner policy of title insurance,” which protects property buyers. Title insurance protects you and your lender if someone challenges or encumbers your title to real property because of title defects that were unknown when you bought the policy.
Most lending institutions will not loan money to purchase a residence or other property unless you buy a "mortgagee" title policy. A Mortagee policy protects the lender´s investment if a title defect voids your title. This policy covers up to the amount of the principal on your loan and will repay the balance of your mortgage if a claim against your property voids your title. Mortgagee policies remain in effect until the loan is repaid. Most lenders will require you to buy a new mortgagee title policy if you refinance your home. When the new loan pays off the existing loan, the old mortgagee policy expires. You are entitled to a premium discount on a new mortgagee policy if you refinance within seven years.
When you buy a house, the title company also issues an owner´s policy, unless you reject it in writing. The owner´s title policy protects you, as the purchaser, against the covered risks and the specific kinds of claims listed in the policy. When you buy a house and purchase a mortgagee policy, a title company will automatically issue an owner policy unless you specifically reject it in writing. An owner policy only covers you up to the value of the property at the time you purchased the policy. It does not cover any increase in value, unless you purchase a special “increased value endorsement.” An owner policy of title insurance remains in effect as long as you or your heirs own the property or are liable for any title warranties made when you sell the property. You should keep your owner policy, even if you transfer your title or sell the property.
In Texas, title policy forms are standardized. This means the policy language is the same, regardless of the company. It’s important that you read your policy carefully because different companies may describe their coverage exceptions differently. Pay special attention to Schedule B of the policy, which explains any limitations, exclusions, exceptions, and special conditions.
Whenever you are planning to close on the purchase of real estate in Texas, you should consult with a lawyer experienced in reading and undertanding title insurance policies, expections, surveys and earnest money contracts. San Antonio Attorney Trey Wilson is experienced in real estate law, including how to file a title insurance claim, understanding title insurance coverage and exclusions / exceptions. He may be contacted at R L Wilson, P.C. Law Firm by calling 210/223-4100 or online at www.sa-law.com
Most lending institutions will not loan money to purchase a residence or other property unless you buy a "mortgagee" title policy. A Mortagee policy protects the lender´s investment if a title defect voids your title. This policy covers up to the amount of the principal on your loan and will repay the balance of your mortgage if a claim against your property voids your title. Mortgagee policies remain in effect until the loan is repaid. Most lenders will require you to buy a new mortgagee title policy if you refinance your home. When the new loan pays off the existing loan, the old mortgagee policy expires. You are entitled to a premium discount on a new mortgagee policy if you refinance within seven years.
When you buy a house, the title company also issues an owner´s policy, unless you reject it in writing. The owner´s title policy protects you, as the purchaser, against the covered risks and the specific kinds of claims listed in the policy. When you buy a house and purchase a mortgagee policy, a title company will automatically issue an owner policy unless you specifically reject it in writing. An owner policy only covers you up to the value of the property at the time you purchased the policy. It does not cover any increase in value, unless you purchase a special “increased value endorsement.” An owner policy of title insurance remains in effect as long as you or your heirs own the property or are liable for any title warranties made when you sell the property. You should keep your owner policy, even if you transfer your title or sell the property.
In Texas, title policy forms are standardized. This means the policy language is the same, regardless of the company. It’s important that you read your policy carefully because different companies may describe their coverage exceptions differently. Pay special attention to Schedule B of the policy, which explains any limitations, exclusions, exceptions, and special conditions.
Whenever you are planning to close on the purchase of real estate in Texas, you should consult with a lawyer experienced in reading and undertanding title insurance policies, expections, surveys and earnest money contracts. San Antonio Attorney Trey Wilson is experienced in real estate law, including how to file a title insurance claim, understanding title insurance coverage and exclusions / exceptions. He may be contacted at R L Wilson, P.C. Law Firm by calling 210/223-4100 or online at www.sa-law.com
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Trey Wilson --Named By Scene in SA Magazine As One of San Antonio's Best Real Estate Litigation Attorneys -- September 2008 -- As voted on by peers