Posts Tagged ‘buyer’
The new TILA-RESPA Integrated Disclosure (TRID) Rule went into effect October 1, 2015 and is already delaying residential real estate closings. TRID requires loan documentation consisting of two new forms: the Loan Estimate and the Closing Disclosure to ensure compliance. These new forms consolidate the TILA-RESPA forms and are meant to give consumers more time to review the total costs of their mortgage.
The Loan Estimate is due to consumers three days after they apply for a loan, and the Closing Disclosure is due to them three days before closing. However, the three day rule is only applicable if the disclosure is delivered personally. If the disclosure is delivered any other way, the Rule “deems” the disclosure was made three business days later, making the disclosure period six or more days before the closing.
Because there are huge potential penalties to mortgage lenders if they do not make the required disclosures on a timely basis, mortgage lenders are interpreting the new rules very conservatively and are adding additional days for the disclosures as a cushion. Thus, rather than using three days before closing as a cutoff, the cutoff for a particular transaction might be 7 – 10 days or more.
Feel free to contact an Illinois attorney experienced in handling all aspects of real estate closings for both buyers and sellers at Logan Law if you have questions about sale of your Chicago area real estate or any other area of the laws governing the purchase or sale of real estate.
When a real estate seller is willing to finance his buyer’s purchase of the property being sold with a relatively small down payment, it is common for the transaction to proceed by what is called a contract sale or an installment contract for deed. Under that form of transaction, the seller does not execute and record a deed when the transaction closes and possession of the property is transferred to the buyer. Instead, the parties execute a document under which the buyer agrees to make payments and to insure and maintain the property and the seller agrees when the seller has been paid as agreed, a deed will eventually be delivered.
When a buyer defaults under the contract, the seller is faced with the problem of how to terminate the contract and get his property back. The contract sale document will provide that after default and upon notice, the contract may be terminated and all prior payments forfeited. However, that does not put the contract seller back into possession of the property.
Restoration of possession requires the use of the Illinois Forcible Entry and Detainer Act, which is contained in the Illinois Code of Civil Procedure (“CCP”). Section 5/9-104.1 of the CCP requires that a demand be served on the buyer giving at least 30 days to satisfy the demand before suit may be filed. The case then proceeds like any other eviction, except that in entry of the eviction judgment, the court may stay the enforcement of the judgment for up to 60 days where more than 75% of the original purchase price remains unpaid but in cases where less than 75% remains unpaid, the Court is required to stay enforcement of the order for 180 days. The court may grant a shorter stay even where than 75% of the original purchase price remains unpaid, if the plaintiff can show that plaintiff had granted previous extensions of the time to pay or for other good cause shown.
Feel free to contact an Illinois attorney experienced in handling all aspects of real estate transactions and litigation at Logan Law if you have questions about sale of your Chicago area real estate or any other area of the laws governing real estate.
The Consumer Financial Protection Bureau (“CFPB”), a new federal agency created in 2010, is imposing new financial disclosure rules for residential mortgage loans applied for on and after August 1, 2015. The new rules will eliminate the HUD-1 settlement statement which has been part of residential closings for many years and replace it with new forms, one of which, the Closing Disclosure, must be sent to the borrower/buyer a fixed number of days in advance of closing. Because large fines of as much as $1,000,000 per day can be imposed on lenders for violating the new rules, it is expected that lenders will err on the side of caution in following the new rules.
Under the new rules the Closing Disclosure, which contains all of the financial information about the closing must be received by the buyer/borrower at least three days before closing. Since it is expected that most lenders will mail the disclosure and because of the time periods for receipt of mailings imposed by the new rules, the Closing Disclosure will have to be mailed more than a week before a closing can occur. Adding to that period, the additional time to be imposed by national lenders for preparation and processing of the form, many lenders are likely to require final closing figures as much as 12 to 14 days in advance of closing.
Thus, for a real estate deal which today could be closed a day or two after final “clear to close” loan approval, the new rules will likely push off that same closing for two weeks after final loan approval.
Feel free to contact an Illinois attorney experienced in handling all aspects of real estate closings for both buyers and sellers at Logan Law if you have questions about the sale of your Chicago area real estate or any other area of the laws governing the purchase or sale of real estate.
Sellers of Illinois properties improved with one to four residential dwelling units are required to disclose to buyers any knowledge they have of building defects. The Illinois Real Property Disclosure Act requires sellers to complete, execute and deliver a residential Real Property Disclosure Report before any contract to sell real estate is executed.
The Disclosure Report requires Illinois real estate sellers to disclose any knowledge they have of any building defects, including but not limited to flooding, recurring leakage, defects in basements roofs, foundations, plumbing or electrical problems as well as defects in the heating, ventilation or air conditioning systems. If prior to closing the real estate, the seller becomes aware that the Disclosure Report is in any respect inaccurate, the seller has a duty to supplement the Report in writing.
An Illinois real estate seller is not liable for errors, omissions or inaccuracies in the real estate Disclosure Report if the seller had no knowledge of the inaccuracy, reasonably believed the defect had been corrected or if the inaccuracy was based upon information furnished by a public agency, licensed professional or by a competent contractor which relied upon by the seller.
Feel free to contact an Illinois attorney experienced in handling all aspects of representing real estate sellers in Chicago area real estate closings at Logan Law, if you have questions about sale of your Chicago area real estate or any other area of the laws governing the purchase or sale of real estate.