** Happy Chinese New Year (Feb. 3rd)!!! **
** Happy Valentine’s Day (Feb. 14th)!!! **
** Not So Happy Property Tax Day **
(2nd half property taxes now due (Feb. 1), delinquent by April 10)
RE-SIGN? WHY? For the past few years we have been seeing more and more important legal documents signed by way of DocuSigns software. From what I understand, the software allows a “signature” with just a click on your computer. What comes out is a box with your name or initial in your chosen script font on the signature line. Using this type of digital and electronic media signature seems like a newfangled “improved” way to do business and you know how we all are about “fads” – I-pod, I-pad, I-phone. However, even though the Federal and State governments have passed electronic transaction acts, we in the settlement industry and Lenders are still very leery of accepting these types of signatures as final.
When I receive documents signed with DocuSign I do make the client re-sign in their own handwriting. This is not done to make life complicated, but to protect all parties involved, including the Real Estate agents as well as us Escrow Holder. When the file is smooth and easy, everyone is happy and go on their merry way. But should it turn ugly and disagreements arise that requires legal counsel, then I want to err on the side that “more is better than less” and the signatures on my documents were actually executed by the client by in his own handwriting.
I have one file right now in which the underwriting of Buyer’s new FHA program has specifically advised us that they will not take a contract signed by DocuSign. Get it re-signed, they said! I am not arguing with them.
Have you noticed how attorneys may fax you their letter but always follow through with a hard copy? Questions have already arisen on accepting fax signatures. Do I want to be the one whose transaction the courts will test the viability of accepting these digital signatures? Absolutely not! Until such time, I will make my clients re-sign, and that is why!
REVERSE MORTGAGES: No matter what the economists say, the economy is not getting better, at least for certain parts of the population. I am worried about those senior citizens with limited income who are caught in a major crunch as government tries to cut spending, the standard of living inexorably rises and Social Security benefits stay static. Those seniors are finding it harder and harder to pay for their basic necessities, much less have anything left over for amenities. This is why the government has backed Reverse Mortgages as it is perhaps the only way those seniors can tap into the only asset that they may have. I have touched on this subject before, but to refresh our memories here are some of the most important parameters:
- Borrower must be at least 62 years “young”
- The loan must be secured as a First Trust Deed loan on the principal residence
- No repayment needed until the home is no longer the principal residence
- No income, employment or credit requirements
- Loan proceeds are tax free and does not affect Social Security of Medicare benefits
This article from CNN Money answers some of the basic questions. Under the Home Equity Conversion Mortgage they draw on it when necessary, and there are no monthly payments to worry about. Could this be the answer for senior citizens under strained circumstances? Contact a Reverse Mortgage Loan Officer to find out!
FILING OF TAXES EXTENSION: Yay! Finally Washington D.C. is doing something that will benefit all of us outside of the Beltway. Tax day is extended until April 18th for this year to file without penalty. Why? Washington D.C. recognizes Emancipation Day as a holiday, which falls on April 16th and will be celebrated on Friday, April 15th . Consequently, we taxpayers throughout the nation will get until midnight of the following Monday to make our annual trip to that nearest post office that postmarks up to 11:59 p.m. Taxpayers who request the automatic six month extension will have until October 17. Sounds like for once D.C. is doing something right!
TAX REFUNDS: While we are on the subject of filing income taxes, here is an amusing article which, after you read it, makes a whole lot of sense. Why overpay on your income taxes through the year? Oh, right, because we are doing our civic duty and trying to help the federal government through a budget pinch. Sure, let them use our money first. After all, we don’t need it!
2010 SCAM LIST: Now that 2010 is finally done we can go back and do the Best or Worst of the year. Deserving of specific mention is the Consumer Affairs 2010 Top Scam list. Whether it is foreclosures, credit card (debt) or gold, the scammers are out there trying to make a buck off of an unsuspecting victim, of which there are many. Here are the Top 10 and for further information, here is the article.
- Foreclosures – you know the drill, pay upfront then disappear
- Charities – is it really for the homeless or needy children?
- Phony debt collectors – it’s all a masquerade
- Work-At-Home – the desperately unemployed are very susceptible to this one
- Facebook – ripe for scammers because this media can reach so many, in particular the young
- Gold purchase – are you really getting your money’s worth for that gold jewelry that your mom hoarded?
- Debt settlement – big upfront bucks, little follow up service (see “foreclosures”)
- Ponzi schemes – if we are still falling for this one, then it’s our own greed talking
- Unauthorized credit card charges – it’s all in the fine, unreadable print
- Timeshare sales – boy, that is so ‘80s
NEW CALIFORNIA LAWS THAT MAY AFFECT YOU: New year, new laws, new ways of making our lives miserable. Here is a short list:
- Short Sale Deficiencies – are out if it is a first loan on a 1-4 residential unit
- MLO licensing kicks in – acting as a mortgage loan originator without the license will see you 6 months behind bars and a hefty $20,000 fine
- Real Estate Fraud protections – protections against unscrupulous foreclosure consultants; against real estate solicitation mail made to look like government agency communication; and increases in punishment and fines for renting homes without owners consent.
- Burbank retrofit requirements – requires water saving devices, with compliance to be signed and delivered to escrow
- Transfer Tax Affidavits declarations required by Riverside, Santa Barbara, San Francisco – don’t want to pay Transfer Tax? Why? Fill out the affidavit. By the way, San Francisco’s Transfer Tax is now 2% for sales $5M and up and 2.5% for $10M or more. No kidding!!!!
ANTI-FLIPPING RULE AND FHA: As posted on my Linked In and FaceBook account, FHA has just advised us they are extending their temporary waiver of their “anti-flipping rule”. Originally this ruling stated that FHA would not lend on properties purchased by the Seller/Investor less than 90 days before the resale to the Buyer. This rule severely limited the sale of affordable housing and constrained the resale market in many areas, leaving many properties vacant and subject to vandalism. With the waiver, which is extended through 2011 instead of ending on Jan 31, 2011, FHA is hoping to boost the market and allow more people to purchase affordable homes that were rehabilitated.
The waiver can be found at: http://www.hud.gov/offices/hsg/sfh/currentwaiver.pdf
On the calendar February is one of those “Red” months as we circle many dates in that color. We have Chinese New Year, Valentine’s Day, Lincoln’s Birthday, President’s/Washington’s Birth Day. And it’s a short month! That means you blink, and it will be the Ides of March. So make every day of this month count as it will soon be gone forever!
“Winning isn’t getting ahead of others. It’s getting ahead of yourself.”
~Roger Staubach, Football Player~
Best Regards!
Juliana Tu, CSEO, CEO, CBSS, CEI
Escrow Manager
