About Real Estate: Buyers have legal options when a seller misleads
A surprisingly large number of home-sale transactions are canceled each year because the seller didn#146;t have the right to peddle the property.Q. I agreed to purchase a home from a man, made a $7,500 good-faith deposit and paid $450 for a home inspection. Shortly after we opened escrow, the man#146;s brother (who neither I or my agent knew about) apparently found out about the pending sale, produced documents that shows he owns a half-interest in the property and canceled the deal because he never signed the listing agreement or purchase offer. What can I do now? Do I have the right to force the sale to be completed or at least sue the seller or his agent because neither one disclosed that the property was 50 percent owned by someone else?
A. Believe it or not, this type of problem is fairly common. It#146;s usually caused when one of a divorcing couple tries to sell a jointly-owned property behind the other#146;s back, but also can be triggered when one co-owning sibling or investor wants to sell but the other one doesn#146;t.
The brother who suddenly #147;came out of the blue#148; never signed a listing or sales agreement, so a judge would never order that the transaction be completed. But you certainly have the right to get your good-faith deposit returned and demand to be reimbursed for all expenses that you have incurred.
You also have at least one good legal argument to sue the prospective seller#146;s agent. One of the first things that a competent agent who takes a listing does is to order a #147;property profile,#148; which should identify everyone who has a partial ownership in the home.
The agent apparently failed to get such a report, or received it but somehow overlooked the fact that the prospective seller#146;s brother has a half-interest in the house. Contact a local real estate attorney for more information.
A. I loved (singer) Michael Jackson and have been watching the trial about his death. Who now owns the home at 100 N. Carolwood Dr. in Los Angeles, where he died?
A. Jackson didn#146;t own the seven bedroom, 13-bath estate designed like a classic French Chateau in the swanky Holmby Hills area of Los Angeles, where he died on June 25, 2009. He rented it for an estimated $125,000 a month from fashion executive Hubert Guez and his wife, Roxanne.
The owners reportedly are trying to rent it again or sell it for about $20 million. You can see an aerial view of the property by visiting www.realtor.com and typing in the address.
Q. Is it true that the term #147;mortgage#148; actually comes from the word #147;mortuary#148; because the borrower will be dead before the loan will be paid off?
A. No, but that#146;s a common misconception.
Webster#146;s New World Dictionary says the word mortgage stems from a French term, morgage or mort gage. Its literal English translation is #147;dead pledge.#148;
To be sure, #147;dead pledge#148; sounds kind of morbid. But look at it this way: A mortgage is simply a document that shows that you have borrowed money and have pledged your home as collateral for the loan. When you finally make the last monthly payment, your debt will be satisfied and your pledge to repay will be legally #147;dead.#148;
Q. My daughter lost her job last spring, and I paid her mortgage for four months to prevent her bank from foreclosing. She got a new job in September and is paying her own bills again, but I am wondering: Can I deduct the interest portion of those payments I made on my own tax return, even though I didn#146;t co-sign for her loan?
A. Sorry, but no. Although I#146;m sure your daughter appreciates your generosity, the Internal Revenue Service won#146;t let you take a deduction for the payments you made because you weren#146;t legally obligated to make them. If you instead had originally co-signed the loan, the IRS would allow you to take your kid#146;s write-offs.
Ironically, your daughter can#146;t take any deductions for the mortgage-interest payments you made for her either. That#146;s because the money didn#146;t come out of her own purse. She#146;s the one who is solely liable for the loan, so she#146;s the only one who would be eligible to claim the write-off.
I#146;m glad that your daughter has found a new job and can pay her bills again. But if she ever needs your mortgage help again, simply give her (or loan her) the money and have her write the checks herself. That way, she#146;ll get to deduct all of the bank#146;s mortgage-interest charges at the end of the year.
Ÿ For the booklet #147;Straight Talk About Living Trusts,#148; send $4 and a self-addressed, stamped envelope to David Myers/Trust, P.O. Box 2960, Culver City, CA 90231-2960
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