Don’t Throw Away Your Release After You’ve Paid Off Your Mortgage

 

We received another question from a viewer this week: “I paid off my mortgage, but I received a document in the mail, is this document important?”

Yes, this document is very important. If you paid off your mortgage or somebody else paid off your mortgage through a refinance or a sale, then the document that you receive needs to be recorded with that County’s Registry of Deeds.

When you grant a mortgage to a lender the mortgage gets recorded with the Registry of Deeds. Granting a mortgage places a lien on your property. This lien needs to be released once it is paid in full. These liens can be called mortgage discharges, releases of mortgage, or satisfaction of mortgage. While there are many different names for this document, it will always be notarized and often have a raised seal.

Say for example, you have a home equity line of credit. If you paid this off and your lender sends you one of these documents back they will alert you that the document needs to be recorded or if it is just a duplicate copy.

If you receive the original copy, you should bring it to the Registry of Deeds to have it recorded. You are always welcome to bring it to our office, so we can verify that it is accurate and help you record it.

If you would like more information about releases of mortgage, contact Stiles Law at (781) 319-1900.

Copyright © 2019 Stiles Law, All rights reserved. Stiles Law is a Massachusetts licensed law firm and all content is based on Massachusetts law. The information presented above is meant to be used for general informational purposes and it should not be construed as legal advice or legal opinion on any specific facts.

Sellers are Recording Buyers at their Showings

 

Here’s a story about a conversation I had with a referral partner of ours. She was showing a property. After leaving, she received a phone call from the Seller who is her client. He asked her, “Why didn’t you tell them about the fireplace? Why were you so bearish on the pool? The pool is great!” The listing agent sat back and thought: how could the Seller possibly know about these conversations? “Were you taping us?”

In MA it is illegal to record the audio of people who do not know that you are recording them. So what should you do?

Sellers: We recommend against recording anyone at your open house, especially without disclosing the fact that you are recording to them. You may be committing a crime. Technically, video taping may be acceptable but it is probably bad faith. You are trying to gain a competitive advantage by recording prospective Buyers. Sellers should disclose that the property is subject to recording.

Professionals: if you are aware of recording, you need to disclose that fact. It should be disclosed on the MLS. It should also be disclosed to each person that is walking into the house. We recommend asking the Seller if they are recording. If so, you should tell them that you will have to disclose this to all prospective Buyers. Further, if a Seller is able to view a potential Buyer and use their appearance in deciding whether to sell to that particular buyer, there may be a potential fair housing violation.

Buyers: you should assume that any house you may be walking through has recording devices. Simply walk through without emotion, without conversation and discuss once you leave the house.

Copyright © 2019 Stiles Law, All rights reserved. Stiles Law is a Massachusetts licensed law firm and all content is based on Massachusetts law. The information presented above is meant to be used for general informational purposes and it should not be construed as legal advice or legal opinion on any specific facts.

Assessment vs Appraisal: What’s the Difference?

 

We received another question: “What is the right number, an appraised value or an assessed value?”

First, what’s the difference? An appraised value is a number that is determined by a licensed appraiser. Appraisers must take continuing education classes, they must go through licensing, and often use multiple factors to determine what a fair market value for the property may be. For instances, comparable properties that have recently sold, quality of finishes, or other improvements can impact the appraised value.

Assessed value is determined by the town through the assessor’s office. An appraised value is almost always closer to fair market value. Assessed value is less accurate and is used only to determine your tax obligations.

Appraisals cost money, so what should you do if you want to sell? We always recommend against relying on an assessment. Usually, spending money on an appraisal not necessary because a quality agent can generate an estimated value by doing a comparative market analysis. The agent will come up with a range of what the house may be worth.

Stiles Law, with offices located in Boston and Marshfield, Massachusetts, is a firm concentrating in real estate conveyancing and mortgage lending services, representing buyers, sellers, borrowers, banks, mortgage companies, investors, builders and developers in all of their real estate and mortgage transactions. Stiles Law serves all areas of eastern Massachusetts–the North Shore, Boston, and Cape Cod, in addition to the entire South Shore, including: Plymouth, Kingston, Duxbury, Hanover, Pembroke, Marshfield, Scituate, Norwell, Cohasset, Hull, Hingham, Weymouth, Braintree, and Quincy.

Copyright © 2019 Stiles Law, All rights reserved. Stiles Law is a Massachusetts licensed law firm and all content is based on Massachusetts law. The information presented above is meant to be used for general informational purposes and it should not be construed as legal advice or legal opinion on any specific facts.

Is a Handshake Good Enough?

 

We received this question from a referral partner: “if we agree verbally that we’ve accepted an offer, is that binding?” In short, no. To form a valid real estate contract in Massachusetts, the contract must be in writing.

Massachusetts Courts have upheld verbal contracts in other circumstances. There are certain types of contracts, like contracts for the sale of real estate, which must be in writing. Take a look at M.G.L. 259 § 1 if you are curious about the other types of contracts. We often see this become a sticking point in a situation where there are multiple bidders. When the high bidder is notified verbally that their offer has been “accepted,” the high bidder often think the contract is legally accepted. If it’s not in writing, it’s not technically accepted.

You may ask, what officially constitutes “writing?” Massachusetts courts have construed emails as acceptable writing. Be careful, texts may be sufficient to create a binding contract. If you are negotiating terms over text message, be mindful that a valid contract can be formed.

Stiles Law, with offices located in Boston and Marshfield, Massachusetts, is a firm concentrating in real estate conveyancing and mortgage lending services, representing buyers, sellers, borrowers, banks, mortgage companies, investors, builders and developers in all of their real estate and mortgage transactions. Stiles Law serves all areas of eastern Massachusetts–the North Shore, Boston, and Cape Cod, in addition to the entire South Shore, including: Plymouth, Kingston, Duxbury, Hanover, Pembroke, Marshfield, Scituate, Norwell, Cohasset, Hull, Hingham, Weymouth, Braintree, and Quincy.

Copyright © 2019 Stiles Law, All rights reserved. Stiles Law is a Massachusetts licensed law firm and all content is based on Massachusetts law. The information presented above is meant to be used for general informational purposes and it should not be construed as legal advice or legal opinion on any specific facts.

Ghosts, Suicides and Homicides: Do Sellers Need to Disclose?

 

We received another viewer’s question: I am listing a home and I have learned that the former owner committed suicide, do I need to disclose this to all of the potential Buyers? We often receive this and other similar questions like: there is a suspicion of a ghost in the house, someone has died due to a homicide, do I need to affirmatively disclose these facts?

In short, under M.G.L. 93A § 108, there is no need to affirmatively disclose these types of items. It is important to remember that if a Buyer asks a specific question the Seller cannot lie whether that lie is explicit or by omission. Misrepresentation is very different from a duty of affirmative disclosure. The Seller must be truthful and honest when specifically asked. The statute specifically states that if a property is psychologically impacted, that is not a material item that must be disclosed.

If you have a question about what needs to be disclosed in a MA real estate transaction, contact Stiles Law at (781) 319-1900 or stiles-law.com.

Stiles Law, with offices located in Boston and Marshfield, Massachusetts, is a firm concentrating in real estate conveyancing and mortgage lending services, representing buyers, sellers, borrowers, banks, mortgage companies, investors, builders and developers in all of their real estate and mortgage transactions. Stiles Law serves all areas of eastern Massachusetts–the North Shore, Boston, and Cape Cod, in addition to the entire South Shore, including: Plymouth, Kingston, Duxbury, Hanover, Pembroke, Marshfield, Scituate, Norwell, Cohasset, Hull, Hingham, Weymouth, Braintree, and Quincy. Copyright © 2019 Stiles Law, All rights reserved. Stiles Law is a Massachusetts licensed law firm and all content is based on Massachusetts law. The information presented above is meant to be used for general informational purposes and it should not be construed as legal advice or legal opinion on any specific facts.

What is a 1031 Exchange?

 

In the last few videos, we have discussed topics related to real estate investing. This week, we are discussing 1031 exchanges. Your natural question may be, what is a 1031 exchange? A 1031 allows a real estate investor to defer the payment of capital gains by allowing a “like-kind exchange.”

When a real estate investor sells, they may have to pay capital gains tax. If that real estate investor intends to sell their property but wants to acquire another investment property, they can utilize the services of a qualified intermediary to perform a like-kind exchange. A like-kind exchange simply means that the property that is sold and acquired is of the same kind, that is, investment property.

What will you need? First, you must use the services of a qualified intermediary. An ordinary CPA or real estate attorney will not suffice—though you should consult both before attempting to perform such an exchange. A qualified intermediary is certified by the IRS to handle the proceeds of the sale. The real estate investor never touches the proceeds.

What are the basic limitations? A 1031 exchange is only available for investment properties. The investor must identify three properties within forty-five (45) days of the sale. Finally, the second transaction must occur within six (6) months of the sale.

1031 exchanges can defer capital gains taxes and substantially increase the real estate investor’s purchasing power. If you have any questions about 1031 exchanges or would like a referral to a qualified intermediary or CPA, contact Stiles Law by calling (781) 319-1900

Stiles Law, with offices located in Boston and Marshfield, Massachusetts, is a firm concentrating in real estate conveyancing and mortgage lending services, representing buyers, sellers, borrowers, banks, mortgage companies, investors, builders and developers in all of their real estate and mortgage transactions. Stiles Law serves all areas of eastern Massachusetts–the North Shore, Boston, and Cape Cod, in addition to the entire South Shore, including: Plymouth, Kingston, Duxbury, Hanover, Pembroke, Marshfield, Scituate, Norwell, Cohasset, Hull, Hingham, Weymouth, Braintree, and Quincy.

Copyright © 2019 Stiles Law, All rights reserved. Stiles Law is a Massachusetts licensed law firm and all content is based on Massachusetts law. The information presented above is meant to be used for general informational purposes and it should not be construed as legal advice or legal opinion on any specific facts.