Aggressive Debt Collectors
This article seems to suggest that they are. Although this is bad news for borrowers, the law, fortunately, protects borrowers from overly aggressive debt collectors. Debt collectors that harass borrowers, contact borrowers at odd hours, or contact borrowers’ employers may be violating the Fair Debt Collection Act. If so, those debt collectors may be forced to pay borrowers $1,000 in damages. Additionally, without proper documentation, the debt may be discharged.
If you believe that you have been harassed by aggressive debt collectors, the Law Firm of Vaughn, Weber & Prakope, PLLC is here to help! Call (516) 858-2620 for a free consultation.
Seller Can Continue to Show House
Is it correct that the seller can continue to show house, after the buyer signs the real estate sales contract?
Yes!
This question comes up rather often. Typically, the scenario plays out like this: the buyer signs the contract first and returns it to the seller for his/her signature. The seller holds the contract, does not sign it, and continues to show the property. There really isn’t much the buyer can do to prohibit the showings. The buyer can threaten to revoke the offer to purchase if the seller does not sign the contract in a timely manner. Of course, a “fully executed” (signed by buyer and seller) contract gives the buyer some recourse. However, a seller continuing to show their home after signing a sales contract may not be considered breach or anticipatory breach of contract. But the buyer may want to take some action to enforce the real estate sales contract. Your attorney will be in the best position to advise you in this situation.
Long Island Real Estate Attorneys
If you need legal representation or have any questions about this or other legal issues, feel free to call the Law Firm of Vaughn, Weber & Prakope, PLLC at 516-858-2620 today to speak to an Attorney.
Fannie Mae and Freddie Mac Short Sale Guidelines
Fannie Mae and Freddie Mac Short Sale Guidelines
Yesterday, the Federal Housing Finance Agency (FHFA) announced new short sale guidelines for Fannie Mae and Freddie Mac loans. The new guidelines go into effect Nov. 1, 2012. We like most of the new guidelines. The new guidelines “will permit a homeowner with a Fannie Mae or Freddie Mac mortgage to sell their home in a short sale even if they are current on their mortgage if they have an eligible hardship.” We believe that being able to short sale a home while being current on that home’s mortgage is important. We have had many cases where a short sale was deemed not possible, as per the mortgage servicer, because the homeowner was current on his/her mortgage. We also like that “Fannie Mae and Freddie Mac will offer up to $6,000 to second lien holders to expedite a short sale.” At times, it can be nearly impossible to complete a short sale when the second lien holder is different from the first. Hopefully, this new guideline creates an incentive for second lien holders to expeditiously approve short sales.
There is one new guideline that may be an issue for some distressed homeowners looking to complete a short sale: “Fannie Mae and Freddie Mac will waive the right to pursue deficiency judgments in exchange for a financial contribution when a borrower has sufficient income or assets to make cash contributions or sign promissory notes: Servicers will evaluate borrowers for additional capacity to cover the shortfall between the outstanding loan balance and the property sales price as part of approving the short sale.” We have seen this done in the past. For some it might make sense to make a financial contribution, but for others it will not make sense to sign a 30 year promissory note or raid their 401k to complete a short sale.
At any rate, this appears to be a move in the right direction. Here are the guidelines ( from the FHFA News Release):
The new guidelines:
- Offer a streamlined short sale approach for borrowers most in need: To move short sales forward expeditiously for those borrowers who have missed several mortgage payments, have low credit scores, and serious financial hardships the documentation required to demonstrate need has been reduced or eliminated.
- Enable servicers to quickly and easily qualify certain borrowers who are current on their mortgages for short sales: Common reasons for borrower hardship are death, divorce, disability, and distant employment transfer or relocation. With the program changes, servicers will be permitted to process short sales for borrowers with these hardships without any additional approval from Fannie Mae or Freddie Mac, even if the borrowers are current on their mortgage payments. Borrowers will now qualify for a short sale if they need to relocate more than 50 miles from their home for a job transfer or new employment opportunity.
- Fannie Mae and Freddie Mac will waive the right to pursue deficiency judgments in exchange for a financial contribution when a borrower has sufficient income or assets to make cash contributions or sign promissory notes: Servicers will evaluate borrowers for additional capacity to cover the shortfall between the outstanding loan balance and the property sales price as part of approving the short sale.
- Offer special treatment for military personnel with Permanent Change of Station (PCS) orders: Service members who are being relocated will be automatically eligible for short sales, even if they are current on their existing mortgages, and will be under no obligation to contribute funds to cover the shortfall between the outstanding loan balance and the sales price on their homes.
- Consolidate existing short sales programs into a single uniform program: Servicers will have more clear and consistent guidelines making it easier to process and execute short sales.
- Provide servicers and borrowers clarity on processing a short sale when a foreclosure sale is pending: The new guidance will clarify when a borrower must submit their application and a sales offer to be considered for a short sale, so that last minute communications and negotiations are handled in a uniform and fair manner.
- Fannie Mae and Freddie Mac will offer up to $6,000 to second lien holders to expedite a short sale. Previously, second lien holders could slow down the short sale process by negotiating for higher amounts.
Long Island Foreclosure Attorneys
If you have any questions about this or other legal issues, feel free to call the Law Firm of Vaughn, Weber & Prakope, PLLC at 516-858-2620 today to speak to an Attorney.
Reasons to Form a Nonprofit
Reasons to Form a Nonprofit
Even though unincorporated associations can qualify for tax exemption, many people may assume that the only reason to incorporate as a nonprofit is to acquire 501(c)(3) status. This is not the case.
With regard to tax exemption, 501(c)(3) may be the most well-known type of tax exemption – and perhaps the most sought after, since it allows donors to write off contributions. Nevertheless, there are many types of tax exempt categories in the Internal Revenue Code. Political Action Committees, for example, are tax exempt under section 501(c)(4) of the Code. There are additional categories for everything from Cemetery Corporations to Black Lung Trusts. Each type of tax exempt category places different restrictions on corporations, but the point is that there are many opportunities to avoid tax liability as a nonprofit.
But there are perfectly good reasons for incorporating as a nonprofit that have nothing to do with taxes. Practically speaking, business corporations are formed for one purpose – to profit the shareholders. If a group of people would like to achieve any other purpose, it should consider nonprofit incorporation. After all, business decision-makers may be bound to pursue any opportunity that would benefit corporate shareholders. This could involve a corporation in activities totally unrelated to its original purpose. But nonprofit corporations are formed for the purposes listed in the certificate of incorporation. Any nonprofit corporate action that strays too far from that purpose may be challenged in court. Once assets are placed in the hands of the corporation, they cannot be used for any other purpose. Therefore, nonprofit incorporation allows individuals to avoid personal liability, while also avoiding the risk that the corporation and its assets are “hijacked” by the largest shareholders.
Chances are, most nonprofit corporations will fall under one of the many tax exempt categories. But even if that weren’t the case, groups that are committed to achieving any particular purpose other than the financial gain of shareholders should consider using the nonprofit corporation as a means to that end.
Corporate Counsel
If you have any questions about this or other legal issues, feel free to call the Law Firm of Vaughn, Weber & Prakope, PLLC at 516-858-2620 today to schedule a free consultation.
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