Homeowner Info

Published On: April 19, 2009

Here's some general homeowner info for your information...

Environmental Issues
When purchasing a piece of property, it is important to be aware of any
environmental liabilities associated with it. For example, you should find out if there
are any registered underground tanks within several miles of the property, any
known contaminated properties in the neighborhood, or any property owners who
have been fined by the government for failing to meet environmental safety
standards.

Before, it took a costly site investigation for the information, but now there are
online environmental databases available at a fraction of the cost. Anyone can
access reports on otherwise hard to detect environmental issues. With these
databases, it is possible to obtain a listing of hazards near a property, or spills and
violations attributed to businesses nearby.

Some reputable databases include VISTA Information Systems, located in San
Diego, California, which allows you to register and search the data bank for free,
and E Data Resources, which is located in Southport, Connecticut. These services
are all relatively inexpensive, but can provide you with priceless information that is
useful before you make a purchase.

Lead Poisoning
Lead poisoning is a serious problem which can lead to adverse health problems. In
children, high levels of lead can cause damage to the brain and nervous system,
behavioral and learning problems, slow growth, and hearing problems. In adults,
lead poisoning can cause reproductive problems, high blood pressure, digestive
problems, nerve disorder, memory and concentration problems, and muscle and
joint pain.

Lead poisoning is especially a problem in cities with older buildings. Typically, lead
is present in the paint from older buildings, in the water supply, and in the
environment from cars and buses. Preventing lead poisoning in large cities, where
there is so much possibility for exposure is both difficult and expensive. Federal
programs have attempted to address this problem.

For buyers and sellers, lead poisoning is also an issue. Houses that were built
before 1978 probably have paint that contains lead. Federal law requires that
sellers disclose known information on lead-base paint hazards before selling a
house. Sales contracts must include a federal form about lead-based paint in the
building. Buyers will have up to 10 days to check for lead hazards and are likely to
stipulate corrections.

Radon
Radon is a colorless and odorless radioactive gas that has been estimated to
cause 5,000 to 20,000 lung cancer deaths yearly. It is second only to smoking as a
cause of lung cancer. It has been estimated that nearly 1 out of every 15 homes in
the US has elevated radon levels.

Understanding Foreclosures
It is an unfortunate commentary, but when economic activity declines and housing
activity decreases more real property enter the foreclosure process. High interest rates and creative financing arrangements also are contributing factors.
When prices are rapidly accelerating during a real estate "bonanza", many people
go to any lengths available to get into the market through investments in vacation
homes, rental housing and "trading up" to more expensive properties. In some
cases, this results in the taking on of high interest rate payments and second, third
and even fourth deeds of trust. Many buyers anticipate that interest rates will drop
and home prices will continue to escalate. Neither may occur, and borrowers may
be faced with large "balloon" payments becoming due. When payments cannot be
met, the foreclosure process looms on the horizon.

In the foreclosure process, one thing should be kept in mind: as a general rule, a
lender would rather receive payments than receive a home due to a foreclosure.
Lenders are not in the business of selling real estate and will often try to
accommodate property owners who are having payment problems. The best plan
is to contact the lender before payment problems arise. If monthly payments are too hefty, it may be that a lender will be able to make some alternative payment arrangements until the owner's financial situation improves.

Let's say, however, that a property owner has missed payments and has not made
any alternate arrangements with the lender. In this case, the lender may decide to
begin the foreclosure process. Under such circumstances, the lender, whether a
bank, savings and loan or private party, will request that the trustee, often a title
company, file a notice of default with the county recorder's office. A copy of the
notice is mailed to the property owner.

If the default is due to a balloon payment not being made when due, the lender can
require full payment on the entire outstanding loan as the only way to cure the
default. If the default is not cured, the lender may direct the trustee to sell the
property at a public sale.

In cases of a public sale, a notice of sale must be published in a local newspaper
and posted in a public place, usually the courthouse, for three consecutive weeks.
Once the notice of sale has been recorded, the property owner has until 5 days
prior to the published sale date to bring the loan current. If the owner cures the
default by making up the payments, the deed of trust will be reinstated and regular
monthly payments will continue as before.

After this time, it may still be possible for the property owner to work out a
postponement on the sale with the lender. However, if no postponement is reached, the property goes "on the block". At the sale, buyers must pay the amount
of their bid in cash, cashier's check or other instrument acceptable to the trustee. A
lender may "credit bid" up to the amount of the obligation being foreclosed upon.
With the recent attention given to foreclosure, there also has been corresponding interest in buying foreclosed properties. However, caveat emptor: buyer beware.
Foreclosed properties are very likely to be burdened with overdue taxes, liens and
clouded titles. A buyer should do his homework and ask a local title company for
information concerning these outstanding liens and encumbrances. Title insurance
may or may not be available following a foreclosure sale and various exceptions may be included in any title insurance policy issued to a buyer of a foreclosed property.

Your local title company will be happy to provide additional information.