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Hidden Hazards: The Thomases’ Battle with Unpermitted Structures and Past Violations.

July 12, 2024 | By

Imagine purchasing your dream property only to be blindsided by fines and legal battles over issues you didn’t create. This is the reality for the Thomases in Humboldt County, California. After buying a property unknowingly used for illegal cannabis cultivation by previous owners, they now face at least $1 million in fines due to an unpermitted structure. This case underscores the critical importance of thorough property investigations before buying, as hidden violations can lead to significant financial and legal consequences for new homeowners.

Background

In 2019, Humboldt County’s code enforcement department raided the property in Miranda, an unincorporated community, and shut down an illegal cannabis operation. The then-owners were cited for unlicensed cultivation and having an unpermitted structure, leading to an administrative penalty of $12,000 over 90 days.

Six days …

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Posted In: Blog, Real Estate

Court Strikes Down Excessive Default Interest Penalties: What Borrowers Need to Know

July 8, 2024 | By

In a landmark decision that has significant implications for borrowers, the California Court of Appeal in Honchariw v. FJM Private Mortgage Fund, LLC ruled that excessive default interest and late fees in non-consumer loans can be deemed unenforceable penalties. This ruling serves as a critical reminder for borrowers to be vigilant about the terms of their loan agreements and offers a pathway to challenge unfair penalty provisions.

Case Background

Nicholas and Sharon Honchariw borrowed $5.6 million from FJM Private Mortgage Fund, LLC, secured by commercial real estate. Their loan agreement included an interest rate of 8.5% per annum, a 10% late fee on missed payments, and a default interest rate that increased to 18.49% upon any default. When the Honchariws missed a payment of $39,667 on September 1, 2019, these …

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Posted In: Blog, Real Estate

Correcting Identity Errors in Real Estate Deeds: Ensuring a Clear Chain of Title

July 4, 2024 | By
Correcting Identity Errors in Real Estate Deeds

In the complex world of real estate, the accuracy of deed documentation is crucial for maintaining a clear chain of title. Errors in the names of grantees or grantors can lead to significant legal and financial complications. Understanding the process of correcting these errors is essential for property owners, real estate professionals, and attorneys. This blog delves into the methods and legal considerations for correcting identity errors in deeds, drawing insights from Miller & Starr’s authoritative guide on California real estate law.

The Importance of Correcting Deed Errors

When a deed contains a misnomer or a slight difference in the spelling of a name, it can create ambiguity about the identity of the property owner. Such discrepancies can disrupt the chain of title, making it difficult to establish clear …

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Posted In: Blog, Real Estate

Buyer Beware: Court Upholds Broker’s Commission Claim in Real Estate Dispute

July 1, 2024 | By
Court Upholds Broker's Commission Claim in Real Estate Dispute

In Chan v. Tsang, the California Court of Appeal examined whether a buyer’s broker can recover a commission from a buyer who unjustifiably refuses to complete a real estate transaction. The court determined that the buyer was responsible for paying the broker $100,000, the commission that would have been earned from the seller if the buyer had fulfilled the purchase agreement.

Tsang (the Buyer) expressed interest to Chan (the Broker) in purchasing commercial property. The Broker introduced the Buyer to a property owned by Mountain View Center Associates (the Seller). The Seller accepted the Buyer’s offer of $4 million, with the Broker’s commission set at $100,000.

However, the Buyer later backed out of the deal without any valid reason. This led to lawsuits between the Seller, the …

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Posted In: Blog, Real Estate Transactions

Understanding Seller Financing: Key Questions and Legal Considerations

June 22, 2024 | By
Understanding Seller Financing: Key Questions and Legal Considerations

Seller financing, also known as a seller “carry back,” is when a property seller extends credit to a buyer to assist with the purchase. This approach can simplify transactions but requires compliance with various state and federal regulations. Here’s an overview of crucial points and common questions regarding seller financing.

Key Questions to Consider in Seller Financing

  1. Specific Disclosures:

    • California law mandates specific disclosures for certain seller financing transactions. For instance, the Seller Financing Addendum and Disclosure (C.A.R. form SFA) is necessary for 1-4 unit residential properties when an arranger of credit is involved.
  2. Arranger of Credit:

    • Typically, the buyer’s real estate agent acts as the arranger of credit. This role can be played by anyone who is not a party to the sale and who is involved
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Demand Letters vs. Litigation: Understanding Your Dispute Resolution Options

June 19, 2024 | By
Demand Letters vs. Litigation: Understanding Your Dispute Resolution Options

When faced with a dispute, deciding between starting with a demand letter or jumping straight into litigation can significantly impact the outcome and efficiency of the resolution process. Each approach has its advantages and should be chosen based on the specific circumstances of your case. Here, we’ll explore the pros and cons of each method to help you make an informed decision.

Starting with a Demand Letter

A demand letter is often the first step in dispute resolution. It is a formal letter sent to the opposing party outlining the facts of the dispute, the legal grounds of your claim, and the specific actions you are requesting to resolve the matter. Here are some key benefits of starting with a demand letter:

Pros of a Demand Letter:

  1. Cost-Effective:

    • Demand
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Zoning Laws and Land Use Disputes: Legal Insights and Solutions

June 14, 2024 | By

Zoning laws and land use regulations are crucial in shaping the development and organization of communities. They dictate how land can be used, what structures can be built, and ensure that property use aligns with community goals and standards.

However, these regulations can also lead to disputes, often requiring legal intervention to resolve. In this article, we will explore the intricacies of zoning laws, common land use disputes, and how a real estate litigation lawyer can provide effective solutions.

Understanding the Zoning Laws in California

Zoning laws are local regulations that govern how land can be used within specific areas or “zones” of a municipality. These zones can include residential, commercial, industrial, agricultural, and mixed-use areas, each with distinct rules and restrictions.

The primary objectives of zoning laws are to:…

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Posted In: Blog, Real Estate Litigation, Real Estate Transactions

Understanding Partition Actions in California: A Guide for Co-Tenants

May 30, 2024 | By

In California, partition actions are a common legal remedy for co-owners who want to end their shared ownership of a property. This process can lead to either the sale of the property and division of the proceeds, or the physical division of the property into separate parcels.

This article will guide you through what a partition action entails, especially focusing on how co-owners can manage improvements and repairs to the property. We’ll delve into the rights and responsibilities of co-tenants, how to claim reimbursement for property enhancements, and the intricacies of handling these situations in court.

The Partition Action

In California, a partition action is a civil procedure used by a co-owner to end joint ownership of a property. This can result in either the sale of the property and …

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Posted In: Blog, Real Estate Litigation, Real Estate Transactions

Common Liens and Judgments

May 23, 2024 | By

Property liens are legal claims that are placed on a piece of real estate (Real Property). They are usually the result of debts that the property owner owes. For example, if a homeowner fails to pay their property tax, the government can put a tax lien on the homeowner’s property.

When a property has a lien,  it means that there is a barrier to selling the property.

The homeowner cannot sell their home unless the lien is removed. In some cases, property liens can even lead to foreclosure. For instance, if a homeowner fails to pay their mortgage, the lender can take possession of the house and sell it to pay off the debt.

There are different types of property liens. They can be either general or specific, and voluntary

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Posted In: Blog, Real Estate Transactions

Understanding Foreclosure: A HANDY REFERENCE GUIDE

May 21, 2024 | By

What is Foreclosure?

When a homeowner fails to make the payments due on their home loan, the mortgage company can ‘foreclose’. This means that the lender can force a sale of the home to pay for the outstanding balance of the loan.

Timeline of a Foreclosure

Day 1 You are in default two days after your payment is due.
Day 32 You have now missed two monthly payments.
 

Day 32-90

Sometime during this period you will receive a letter stating that the Notice of Default (NOD) has been recorded. The speed with which lenders send NOD depends on the policy of each individual lender.
 

NOD Recorded

From this day, the next 90 days is a silent period. You have this time to pay all back payments, fees, and other charges
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Posted In: Blog, Real Estate Transactions