All Forum Posts by: Tom Gimer

I'm with @Wayne Brooks... never let the seller do the work. 

There is no incentive for a seller to do anything other than the bare minimum necessary to satisfy the terms of the agreement. They will do so at the cheapest possible price and the shoddy work will become apparent after the excitement of the purchase wears off.

Our company is very much involved with the MD investor market from Baltimore to DC suburbs to the Eastern Shore, so anybody looking to talk contracts/terms, networking, JVing with other investors, and now it sounds like more attempted anti-investor legislation... feel free to connect.

Quote from @Shafi Noss:

Quote from @Hemal Adani:

Quote from @Shafi Noss:

Challenge is if you check records the afternoon before, a lien could slip in during those few days. I would do this with a partner on the phone who checks the records like Chris mentioned and makes sure there's no slippage.  

@Shafi Noss are saying a new lien can slip in between auction and issuing sheriff's deed?

I was saying that if you do your title search one day before the auction, there is a one day window where a new lien could slip in without you knowing. Especially if it's a lien immune to foreclosure, that can cost you. Things tend to happen around a foreclosure so it's not impossible. The way I would prevent that is by having a partner on the phone checking the records while I'm literally sitting at the auction to avoid that slippage. 

As for a lien between auction and issuing the deed, I know less about how that works, but I think it's a risk. A contractor has time to record a mechanics lien, what if they did not sign lien waivers and then file after the foreclosure. 

Like I said some liens are superior to foreclosure, like utility liens, some government liens, and in 22 states HOA liens as well. I'm not sure how it works if those are attempted to be recorded between the auction and deed issuance.

Every state is different. I’m not aware of any state that allows what would be a junior lien and would be extinguished in the foreclosure sale to game the system and record the lien in the gap between notice of the sale and the actual sale.

There are ways to legally address such “liens” when they do arise in the middle of a foreclosure… such as redemption or surplus or even a QT action. 

Also many states have a cut-off date (in relation to some filing or event) where notices to junior lien holders are no longer required, if actual notice was even required to begin with. 

Quote from @Hemal Adani:

Quote from @Shafi Noss:

Challenge is if you check records the afternoon before, a lien could slip in during those few days. I would do this with a partner on the phone who checks the records like Chris mentioned and makes sure there's no slippage.  

@Shafi Noss are saying a new lien can slip in between auction and issuing sheriff's deed?

This is a very particular area of law. You are going to need to research local law on mortgage/deed of trust foreclosures vs. sheriff sales (levies to satisfy judgments). There is often a difference between the two with respect to what interest of the debtor the auction purchaser acquires -- that at the time of the recording of the mortgage (foreclosure) vs. that at the time the judgment was entered (sheriff). I'm trying to simplify this but it's hardly simple.

I generally agree with @Russell Brazil and @Chris Seveney about written agreements, but there certainly are a growing number of cases (thanks to text messaging, etc.) where the signed writing requirement has been satisfied by conduct other than a signature on the _______________ line at the end of the agreement.

Whether there was a binding contract formed in this instance would require an in depth review of the "contract" and all of the relevant communications surrounding it. I am not surprised that an attorney would be willing to take the case and start billing for their time. However the question is how much I am willing to invest in that attorney's bank account to possibly secure the property. If my plans were to flip it for a modest profit no way would I invest many thousands of dollars in attorneys fees just to possibly achieve that goal.

Quote from @Russell Brazil:

Quote from @Tom Gimer:

@Russell Brazil I don't think that will be the end result... or that MD considers agents wholesaling to be illegal.

I think REALTORs have changed their focus to defending their commissions and cannot afford to fight this battle right now.

From what I understand, Maryland is going to move to a disclosure requirement (I'm going to assign this contract; here's where you can find the assessed value of your property; etc.), with parties having the ability to cancel a contract and potentially keep the EMD when the required disclosures are not made by the wholesaler.

 Im involved in the negotiations of the bill and having meetings in Annapolis this week on it. As well as meetings on the new agency bill. 

I don't doubt that. But from what I've seen MD may go the way of AZ and some other states:

https://azre.gov/news/arizonas-new-wholesaling-disclosure-re...

I've seen the proposed amendments to current MD law and to me the proposed framework to protect the public makes more sense than trying to require people get licensed just so they can engage in conduct that you suggest the state considers illegal to begin with.

@Jack Seiden There is no fiduciary relationship established because the licensee is not acting as anybody's agent when they are buying and selling on their own account. 

No duty = no breach.

@Russell Brazil I don't think that will be the end result... or that MD considers agents wholesaling to be illegal.

I think REALTORs have changed their focus to defending their commissions and cannot afford to fight this battle right now.

From what I understand, Maryland is going to move to a disclosure requirement (I'm going to assign this contract; here's where you can find the assessed value of your property; etc.), with parties having the ability to cancel a contract and potentially keep the EMD when the required disclosures are not made by the wholesaler.

@Jack B. A non-exclusive easement granted to a utility company, including reference to ingress and egress, doesn’t grant anyone other than the utility company any property rights. Period. 

Hire a surveyor and a real estate attorney (if necessary) to iron this out. Everything may be resolved with a drawing and a discussion. If not, a single letter from your attorney would help in several ways including preventing and defending a future QT action. 

Quote from @Crystal Smith:

I didn't provide advice... I provided the current state of US law regarding EMDs. EMD as a legal requirement for a valid real estate contract is a myth.

Try this in a search engine: "is earnest money required in [state]" and the result will be page after page, state after state, of attorneys, real estate commissions, brokers, all confirming that it's not. 

Should a seller contract with someone who has zero incentive to close, nothing to lose if they default? Of course not.