Greater Seattle Real Estate News

March 21, 2017

File Your Taxes - Even If You Cannot Pay

McFerran Law, P.S.
Practicing Real Estate Law in Western Washington since 1986

March 20th, 2017

Bankruptcy Update:
4 Compelling Reasons to File Your Tax Return Even If You Cannot Pay

Although you are receiving this email from our bankruptcy department, it is not exclusively or strictly a bankruptcy matter. See last week’s email to see how it applies to bankruptcy.

Should you file the tax return if you can’t pay the tax?
You got to the bottom of your tax return and the amount you owe is bigger than your checkbook balance.
Scared of filing the return for fear of immediate collection action?
Scared of even calculating how much you owe?  think an extension of time to file looks good?
Fearful that you’ll be hanging a sign around your neck:  squeeze this guy?
Nope.  It doesn’t work that way.
The IRS does not start harassing nonpayers for money on April 16th.  Or even September 16th.  They haven’t even posted the returns that have been filed by then.
Relax, breathe deeply, and file the return.  There are far more advantages to getting the return on file than risks in admitting you owe money you can’t pay.

Easy tax payment plans available
If you can’t pay the full amount of the tax owed, send a partial payment with your return.  Reduce as much as you can your debt to the tax folks.
Nothing requires that you enter into an agreement for payment.  Simply send money regularly toward retiring the tax.
Put your name, social security number and the tax year you want the money credited to on the check.
If you feel the need for a formal payment agreement with the feds, you can set up a payment plan, online, if you owe less than $50,000. (https://www.irs.gov/individuals/online-payment-agreement-application).

Separate penalties for failure to file
If you fail to file a tax return and don’t get an extension, you expose yourself to a separate penalty for failure to file the return.
That’s on top of the penalty for failure to pay as required.
So, it’s expensive to try to drop out of sight.

Filing returns start clock ticking on escape options
Taxes don’t live forever. There’s a collection statute of limitations (generally 10 years with some exceptions) that makes taxes uncollectable.  Bankruptcy laws permit the discharge of taxes of a certain age.
But both escape routes for taxes you can’t pay start counting from the filing of your tax return.  (More precisely, the SOL starts from assessment, but filing the return is a self-assessment).

Last year’s figures drive this year’s withholding
The most important reason to prepare last year’s tax return now is to get your withholding right for the current year.
Extensions to file are seductive, but dangerous.  It puts off squaring up your withholding for the current year, so this doesn’t happen again.
If you put off calculating just how much you owe for last year until October, you have only a few months before next April to get this year’s taxes paid in.
Closing your eyes to an under withholding problem won’t make it go away.
Calculate what you owe, make a plan to pay it if possible, and fix your withholding or quarterly payments so you’re OK next year.

If you are facing significant financial strain and want to explore how bankruptcy could provide you relief, then we invite you to contact McFerran Law, P.S. Our legal team has accumulated more than thirty-five years of bankruptcy law experience and is ready to help you explore your financial options during this difficult time. Call us at 253-284-3838 to schedule a FREE one-hour bankruptcy consultation at any of our offices in Tacoma, Seattle, Everett, Kent or Silverdale.
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Posted in Uncategorized
March 10, 2017

Puget Sound Market Prices Up

Seattle and Eastside home prices, after brief slowdown, surge to record highs

Home prices in Seattle have nearly doubled over the last five years, as the number of local homes for sale hits its lowest point on record.

March 7, 2017

Seattle Times business reporter

Local home prices are surging back up again to record heights, signaling the end to the normal winter cool-down in the market.

King County’s median single-family home price was $560,000 in February, up 6.7 percent from January — the biggest one-month jump in home prices since early 2015, new data released Monday shows. The sharp increase comes after a recent trend of slowing home price growth that’s common in colder months.

The biggest price increases hit the suburbs, but the city of Seattle saw a healthy bump, as well.

Read more:

http://www.seattletimes.com/business/real-estate/seattle-and-eastside-home-prices-after-brief-slowdown-surge-to-record-highs/

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James Robert Deal, Broker and Attorney
Broker with Agency One Realty LLC
WSBA # 8103, DOL # 39666
425-774-6611, 888-999-2022
425-776-8081 fax
James at James Deal dot com

Posted in Home Prices
March 9, 2017

Questions To Ask Before You Buy A Home

Six Questions To Ask Before Buying A Home

Being armed with information will allow a potential buyer to come to an appropriate decision.

Before you make an offer on a house, it pays to ask a handful of questions. While the answers might scare you off or make you rethink your bid, they could make you feel more confident that you’re making the right move on the right house.

As you prepare to buy a home, here are seven questions to ask before you make the offer.

Click here to read more.

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James Robert Deal, Broker and Attorney
Broker with Agency One Realty LLC
WSBA # 8103, DOL # 39666
425-774-6611, 888-999-2022
425-776-8081 fax
James at James Deal dot com

jrd-suit-clean-full-576

March 9, 2017

Prince Did Not Have A Will - Do You?

Don’t do What Prince Did. Leave a will.

Columnist

At first, when I heard Prince didn’t have a will, I was sad.

After all, the iconic singer, whose full name was Prince Rogers Nelson, was ferociously protective of his music and his image. He once wrote “slave” on his face to protest a music deal that left him without ownership of his work. During the dispute, you’ll recall, we had to refer to him as “the Artist Formerly Known as Prince.” I came to respect the symbol that he used as his name for a while because he was fighting for his legacy.

Prince patrolled the Internet for unauthorized use of his music and some reports said he rejected offers to use his songs to sell products. He was all about control.

And now, following his death at age 57, the control he fought so hard for may be gone.

According to court documents filed by his sister, Prince left no instructions on how to handle his assets, including his published music and enough unpublished work that reportedly an album a year could be released for decades.

Click here to read more.

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James Robert Deal, Broker and Attorney
Broker with Agency One Realty LLC
WSBA # 8103, DOL # 39666
425-774-6611, 888-999-2022
425-776-8081 fax
James at James Deal dot com

Posted in Estate Planning
March 7, 2017

Winter Gardening in Lynnwood

James Robert Deal - Winter Gardening Report - March 6, 2017

Even with temperatures down to 20 degrees F. in December of 2016 and January of 2017, vegetables in my back yard survived and supplied a steady diet of healthy greens, including: Italian kale, curly kale, red Russian kale, leeks, chives, mustard, Swiss chard, and more.

If you have a shady yard, there are plants will grow there.

If you live in a condominium or apartment, you can still grow your own indoor garden by sprouting. I recommend lentils and mung beans. Just put them in water in a bowl. Change the water twice daily.

See the next video about how to cook kale: 

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James Robert Deal, Broker and Attorney
Broker with Agency One Realty LLC
WSBA # 8103, DOL # 39666
425-774-6611, 888-999-2022
425-776-8081 fax
James at James Deal dot com

James Robert Deal, Attorney & Broker James Robert Deal, Attorney & Broker
Posted in Health
March 2, 2017

The Foreclosure Train Rolls On

FORECLOSURES DESTROY HOMES

Mortgage modification was intended to be easy to qualify for. Anyone willing to pay up to 31% of family income should be allowed to stave off foreclosure, even if the 31% paid does not cover the actual mortgage payment. But mortgage modification was narrowly construed, like underwriting to get a new loan, and millions of homes have been foreclosed. Many of those foreclosed homes fell into ruin. Foreclosures destroy homes.

***

How Housing’s New Players Spiraled Into Banks’ Old Mistakes

When the housing crisis sent the American economy to the brink of disaster in 2008, millions of people lost their homes. The banking system had failed homeowners and their families.

New investors soon swept in — mainly private equity firms — promising to do better.

But some of these new investors are repeating the mistakes that banks committed throughout the housing crisis, an investigation by The New York Times has found. They are quickly foreclosing on homeowners. They are losing families’ mortgage paperwork, much as the banks did. And many of these practices were enabled by the federal government, which sold tens of thousands of discounted mortgages to private equity investors, while making few demands on how they treated struggling homeowners.

The rising importance of private equity in the housing market is one of the most consequential transformations of the post-crisis American financial landscape. A home, after all, is the single largest investment most families will ever make.

Private equity firms, and the mortgage companies they own, face less oversight than the banks. And yet they are the cleanup crew for the worst housing crisis since the Great Depression.

Out of the more than a dozen private equity firms operating in the housing industry, The Times examined three of the largest to assess their impact on homeowners and renters.

Lone Star Funds’ mortgage operation has aggressively pushed thousands of homeowners toward foreclosure, according to housing data, interviews with borrowers and records obtained through a Freedom of Information request. Lone Star ranks among the country’s biggest buyers of delinquent mortgages from the government and banks.

Nationstar Mortgage, which leaped over big banks to become the fourth-largest collector of mortgage bills, repeatedly lost loan files and failed to detect errors in other documents. These mistakes, according to confidential regulatory records from a 2014 examination, put “borrowers at significant risk of servicing and foreclosure abuses.”

Unlike the banks, Nationstar wears many hats at once: mortgage bill collector, auction house for foreclosed homes and lender to new borrowers. By working every angle, and collecting fees at each step, the company faces potential conflicts of interest that enable it to make money on what is otherwise a costly foreclosure process.

...

Caliber Home Loans, Lone Star’s mortgage servicing subsidiary, said that “modifying a nonperforming loan for a borrower is almost always the most profitable option for a lender, and Caliber is incentivized to pursue that outcome.”

Yet Lone Star and Caliber have foreclosed on more than 14 percent of the 17,000 loans the firm picked up at auction from the Department of Housing and Urban Development in 2014, according to an analysis of loan filings that RealtyTrac performed for The Times. Caliber is now moving toward foreclosing on at least another 3,200.

Read more. http://www.nytimes.com/2016/06/27/business/dealbook/private-equity-housing-missteps.html

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James Robert Deal, Broker and Attorney
Broker with Agency One Realty LLC
WSBA # 8103, DOL # 39666
425-774-6611, 888-999-2022
425-776-8081 fax
James at James Deal dot com

Posted in Foreclosure
Feb. 27, 2017

Dodd Frank and Seller Financing

If you sell your property on seller financing, you must comply with Dodd Frank restrictions on seller financing. These restrictions apply if the deal is a recorded wrap-around deal. Some experts say that a lease option is not a sale and that Dodd Frank does not apply. Other experts say it does.

If you sell to a buyer who is not going live in the property, Dodd Frank does not apply. This means the seller can require full payoff in fewer than five years and that the interest rate may be variable from the start. It means that the buyer need not consult with a mortgage broker and qualify financially.

However, if you sell to a buyer who will live in the property, Dodd Frank does apply. Seller financed sales come under three exclusions.

One Property Exclusion: If you sell only one property per year, and if the buyer will live in the property, the buyer is not required to qualify through a mortgage broker. But the interest rate for the first five years must be fixed. Thereafter the rate and payment may increase. No negative amortization loans are allowed. The law probably allows a five year balloon payment cash out, although the law does not state this explicitly. It is clear that the rate can go up after five years to a level which will compel the buyer to refinance. Only sellers who are individuals, trusts, or estates can take advantage of the one property exclusion. Corporations, LLC’s, and partnerships cannot rely on the one-property exclusion.

Three Property Exclusion: If you sell to a buyer who will live in the property, and if you sell up to three properties per year, the buyer must qualify through a mortgage broker. The interest rate for the first five years again must be fixed. Thereafter the rate and payment again may increase. No negative amortizaiotn loans are allowed. It is clear under the three property rule that the seller must give the buyer a 30 year mortgage, but it is also clear that the rate can go up after five years to a level which would compel the buyer to refinance. Sellers who are individuals, trusts, estates, corporations, LLCs, and partnerships can use the three property exclusion.

Dodd Frank treats the seller who is not an individual but is a builder differently. But the law does not make it clear what extra requirement falls on the builder who engages in seller financing. Dodd Frank says neither the one-property, nor the three-property exclusions may be used, although the law does not make it clear what additional limitations there are and under what terms a seller can offer seller financing. Presumably, the same restrictions used under the three-party rule would apply where the seller is a builder and not an individual. Or perhaps builders are forbidden to engage in seller financing. The Dodd Frank statute does not make this clear one way or the other.

Dodd Frank treats the seller who sells more than three properties in a year differently. But the law does not make it clear what extra requirement falls on the seller who sells more than three properties per year. builder Neither the one-property, nor the three-property exclusions may be used, although the law does not make it clear what additional limitations there are and under what terms a seller can offer seller financing. Presumably, the same restrictions used under the three-party rule would apply where the seller is a builder and not an individual. Or perhaps sellers who sell more than three properties in a year are forbidden to engage in seller financing. The Dodd Frank statute does not make this clear one way or the other.

To complicate matters further, there is the SAFE Act, which may overlap with with Dodd Frank. Read the Washington DFI explanation here. And you should also read this article by the DFI.

I repeat: Dodd Frank and the SAFE Act as they pertain to seller financing are poorly written. Consult an attorney and a mortgage broker if you are selling on seller financing and if the buyer is going to occupy the home. You should not rely on this overview for legal guidance since I have not completely figured out this conglomeration of semi-indecipherable provisions.

Read the Dodd Frank rules on seller financing:

http://www.consumerfinance.gov/eregulations/1026-36/2013-30108_20140118

Read the Washington regulations on seller financing:

http://www.dfi.wa.gov/documents/seller-financing/residential-seller-financing.pdf

Read the following items for more information. You will see there is quite a bit of divergent opinion as to how it applies to seller financing.

http://www.realtor.org/topics/seller-financing/the-safe-act

http://frascona.com/dodd-frank-consumer-financial-protection-owner-financing/

http://www.ksefocus.com/billdatabase/clientfiles/172/4/1720.pdf

https://www.biggerpockets.com/renewsblog/2014/01/17/dodd-frank-law-changes-seller-financing-investors/

http://www.legalwiz.com/owner-financing-dodd-frank-safe-act/

https://www.consumerfinance.gov/policy-compliance/rulemaking/final-rules/ability-repay-and-qualified-mortgage-standards-under-truth-lending-act-regulation-z/

http://files.consumerfinance.gov/f/201301_cfpb_final-rule_ability-to-repay-interpretations.pdf

https://www.youtube.com/watch?v=cijbTG9_VlA

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James Robert Deal, Broker and Attorney
Broker with Agency One Realty LLC
WSBA # 8103, DOL # 39666
425-774-6611, 888-999-2022
James at James Deal dot com

James Robert Deal, Attorney & Broker James Robert Deal, Attorney & Broker

 

Posted in Seller Financing
Sept. 27, 2016

Buy This Book - Chain of Title

Chain of Title

 

How Three Ordinary Americans Uncovered Wall Street’s Great Foreclosure Fraud

Available: April 2016

6 1/8 x 9 1/4 , 400 pages

ISBN: 978-1-62097-158-1
Also available as an e-book

David Dayen

David Dayen - Photo: John Florance

David Dayen is a contributing writer toSalon and a weekly columnist for theFiscal Times. He also writes for publications including the New Republic, the American Prospect, The Guardian,...

Chain of Title

How Three Ordinary Americans Uncovered Wall Street’s Great Foreclosure Fraud

The dramatic true story of how a nurse, a car dealership worker, and a forensic expert took on the nation’s largest banks—and then shook them to their core

“It had been a long day. Lynn just wanted to get back to West Palm Beach and relax. Just before her flight took off, she reached forward to get the in-flight magazine. The stranger sitting next to her leaned forward and said, ‘You know what happens to people who sue banks?’

‘What?’

‘They end up dead.’”

—from Chain of Title

Winner of the Ida and Studs Terkel Prize

In the depths of the Great Recession, a cancer nurse, a car dealership worker, and an insurance fraud specialist helped uncover the largest consumer crime in American history—a scandal that implicated dozens of major executives on Wall Street. They called it foreclosure fraud: millions of families were kicked out of their homes based on false evidence by mortgage companies that had no legal right to foreclose.

Lisa Epstein, Michael Redman, and Lynn Szymoniak did not work in government or law enforcement. They had no history of anticorporate activism. Instead they were all foreclosure victims, and while struggling with their shame and isolation they committed a revolutionary act: closely reading their mortgage documents, discovering the deceit behind them, and building a movement to expose it.

Fiscal Times columnist David Dayen recounts how these ordinary Floridians challenged the most powerful institutions in America armed only with the truth—and for a brief moment brought the corrupt financial industry to its knees.

Topics:

“David Dayen first wrote about foreclosures as a scruffy blogger and consistently beat almost every established financial reporter to the story. Now he has written the best history of that shameful period. The mortgage industry spent untold millions to spread the story they created from whole cloth after the crisis hit: families who lost their homes were mostly undeserving spendthrifts trying to shirk just debts. Chain of Title tells the real story and the real story should offend the sense of justice of every American with a conscience.”
—Former congressman Brad Miller (D-NC), original co-author of the section of the Dodd-Frank Act that created the Consumer Financial Protection Bureau
“Gripping. . . . The homeowners’ stories are emotional roller coasters, which Dayen meticulously reports.”
The New York Times Book Review
“This is the story, one of its characters tells us, of an unlikely ‘crime scene’: the real estate courts of Florida, where professional fraudsters greased the skids to kick people out of their houses in order to prop up Wall Street’s profits, while judges looked the other way. And, it is the story of a prairie fire—began by ordinary Americans who brilliantly and courageously fought back when our leaders refused to do so. All in all, it is one of the best books about the law and American life that I ever have read.”
—Rick Perlstein, author of Nixonland and The Invisible Bridge
Chain of Title is a sweeping work of investigative journalism that traces the arc of a criminally underreported story in America, the collapse of the rule of law in the home mortgage industry. By following three victims of illegal foreclosure practices, Dayen humanizes and brilliantly illuminates a vast scam unseen by the public because it’s been indecipherable to everyone but a few industrious housing lawyers—as he shows, even judges don’t understand it. The nightmare scavenger-hunt pursued by homeowners like Lisa Epstein leads to a horror-ending: behind the dream of home ownership lies a lawless jungle, owned and operated by banks, where there are no rules to protect families and their property.”
—Matt Taibbi, author of The Divide
“An inspiring, well-rendered, deeply reported, and often infuriating account.”
Kirkus Reviews
“Dayen elevates a muckraking exposé of fraudulent foreclosures to Hitchcockian levels of suspense. . . . Meticulously researched, enthralling, and educational, this addition to the literature of the Great Recession calls out for its own big-screen adaptation.”
Publishers Weekly
“In the wake of the devastating 2008 financial crisis, David Dayen has become one of the nation’s most knowledgeable, astute and important voices in identifying the culprits and documenting the efforts to protect them. His new book is one of the most important yet written on the causes of that crisis, the abject failures of the political class to punish the wrongdoers, and the dangerous refusal on the part of the nation’s elite to safeguard against future and even worse meltdowns.”
—Glenn Greenwald

News and Reviews

Dissent Magazine

Mike Konczal reviews Chain of Title in Dissent Magazine.

The Philadelphia Inquirer

Jake Blumgart reviews Chain of Title in The Philadelphia Inquirer.

The Week

The Week calls Chain of Title "excellent and absolutely infuriating"

The New York Times

The New York Times reviews Chain of Title.

July 26, 2016

Jarjour Listing

The Northwest Multiple Listing Association listing number for this property is 1003544.

The address is 13817 NE 40th St Bellevue WA 98005.

See everything about this beautiful home at this link, including video:

https://app.box.com/v/jarjour

But ...

Remember that this home has had moisture damage from a roof which leaks and exterior wall system which has failed. We have a bid from two years ago which estimates that the cost of repair will exceed $800,000.

Two years ago, the sellers spent around $5,000 on an engineering report which describes the repairs needed. To give you a head start, we are sharing this engineering report with potential buyers.

The buyer of this home should consult with a structural engineer. The buyer might consider hiring the same engineer which did the seller's inspection.

Click here to view the title report, engineering report, and other items at this link.

The buyer should share the engineering report with a contractor who will estimate what it will cost to repair the property. The buyer should estimate what the property will be worth after it is repaired, subtract the estimated cost of repair plus an allowance for possible over-runs, and then make an offer.

Contact me if you have questons.

James Robert Deal, Listing Broker and Seller's Attorney

425-771-1110

James@JamesDeal.com

jrd-suit-clean

Posted in Real Estate Broker
July 23, 2016

You Need A Lawyer When Doing A Modification

You Need A Lawyer When Doing A Modification

Most of my modification clients tried to apply on their own and got turned down. Modification involves underwriting, and underwriters are very particular.

Modification is a big deal. If you don't get that modification, you might be foreclosed. Or you may be stuck with a high interest rate, which impact the quality of your life.

There is a lot of money involved here. If your mortgage balance is $400,000, for example, a rate reduction of 2.0% per year is worth $8,000 per year or $666 per month.

I have talked with people who have gotten 4.0% modifications, which I could possibly gotten them a 2.0% modification. Lenders give better modifications when the borrower is represented by an attorney.

Attorney Adam Deutsch says:

The CFPB uncovered many instances of loan servicers refusing to convert trial loan modifications to permanent modifications, despite borrowers having successfully completed the trial loan modification terms. ...

Loan modification denial notices continue to fail to state the correct reason(s) for denying a trial or permanent loan modification option as required.”

Moreover, many servicers are failing to advise borrowers that they have the right to appeal the loan modification denial, a failure which often results in major consequences since under RESPA borrowers only have a limited time to appeal their denial.·

Servicers failed to honor the terms of in-place trial modifications after transfer. Some borrowers who completed trial payments with the new servicer nevertheless encountered substantial delays before receiving a permanent loan modification.” This is among the biggest complaints voiced by homeowners. Repeatedly I have encountered situations where a borrower has honored a trial loan modification for six months, and then immediately following the final payment the borrower’s loan is transferred to a different servicer. And, lo and behold, that servicer announces that they will not honor the trial modification.

The borrower will have to go through the modification procedure over again. We have had several modifications where a servicer transferred servicing during the modification, forcing us to redo our work for the new servicer.

http://thehill.com/blogs/congress-blog/economy-budget/288804-once-again-cfpb-finds-loan-servicers-routinely-violate

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James Robert Deal, Broker and Attorney
Broker with Agency One Realty LLC
WSBA # 8103, DOL # 39666
425-774-6611, 888-999-2022
425-776-8081 fax
James at James Deal dot com