Fire Starter

DEAR TOM: The exact answer depends on how your mother and your late father held title.

In most states, if they held title as joint tenants with right of survivorship, or as tenants by the entireties, it is usually quite simple to remove the deceased owner's name from the title. All that is required is to record a certified copy of the death certificate and an affidavit of survivorship.

But there might be some complication with your mother's title. For example, if title was held as tenants in common, then your late father's half of the property usually requires probate court proceedings according to the terms of his will.

The reason to remove a deceased co-owner's name from the title now is to simplify matters when your mother either sells the property or dies. Also, removing his name will establish your mother's stepped-up basis to market value for his half as of the date of his death.

If this is not done now while there is no urgency, the problem will still eventually have to be confronted.

DEAR BOB: We hold a mortgage note on a property we sold about 10 years ago. The final payment is due in a week. A few days ago, the borrower called to say he might be late with the final payment. He said his mortgage broker was moving very slowly, and he even went to someone else to get refinanced. Last January, the title company asked us to fill out the paperwork for full payoff of this mortgage. In August, they requested an updated payoff demand. What are my options? I think the borrower might be trying to combine a couple of mortgages on several properties he owns. I just want to be sure he doesn't take advantage of us. -- Linda L.

DEAR LINDA: You probably have nothing to worry about. However, if the due date passes and the borrower shows no sign of paying the balance soon -- after giving him an extra 30 days or so -- I would suggest beginning foreclosure.

Most institutional lenders now give only 30 to 45 days grace period. Once you begin foreclosure, the borrower must pay your expenses, such as attorney fees and filing costs.

I am concerned the borrower might file for bankruptcy, thus delaying your money. As a secured mortgage lender, you are well protected, but starting foreclosure soon shows the borrower you mean business. For details, consult a real estate lawyer who specializes in foreclosures.

DEAR BOB: Recently you said you prefer not to bid at foreclosure auctions but instead contact the foreclosing lender immediately after the auction if there were no bidders. I've been a real estate agent for about 15 years, and this is exactly what I did when I purchased my home. By contacting the lender after the auction, I was able to get the lender to pay to replace the furnace and erect a needed fence around the pool. I still paid about $6,000 less than if I had bid at the auction. -- Donald M.

DEAR DONALD: Buying REO (real estate owned) from the foreclosing lender is the best way, in my opinion, to acquire foreclosure property. Many foreclosing lenders also offer very attractive mortgage financing to buyers of their REO properties.

DEAR BOB: We put our home up for sale in early October. Within a week, we signed a sales contract with buyers. Eight days later, the buyers backed out, saying they changed their minds. We opted to keep their $2,500 earnest money deposit. But we discovered the next day that the real estate agent never received the $2,500 stated in the contract. We believe we are owed this money but have been advised to forget it. Who is at fault for not actually collecting the $2,500? Should we try to collect it? -- Joy C.

DEAR JOY: Shame on that real estate agent. Unless the real estate agent told you in advance that the $2,500 earnest money deposit stated in the sales contract had not been received from the buyers and deposited in the agent's trust account, that agent is clearly liable to you for the missing $2,500.

If she refuses to pay you the $2,500 promptly, take her to local small claims court to obtain a judgment against her. There is no valid excuse for a real estate agent ever bringing you a purchase offer to accept and not informing you she hasn't received the $2,500 earnest money deposit stated in the contract.

Real estate purchase contracts do not include a "free look" allowing the buyer to back out eight days after the seller accepts the offer.

Of course, if there is a valid contingency clause, cancellation could be legitimate. For instance, if there were a mortgage financing contingency clause, the buyers could cancel if they were rejected for a mortgage by several lenders. However, if they never applied for a mortgage, then that escape clause couldn't be used.

DEAR BOB: My husband and I sold our home in July 2005. The buyer requested additional time for inspections and multiple inspections were conducted. The buyer requested a credit back, which we granted. More than a year later, we have been contacted by the buyer's lawyer with a letter accusing us of nondisclosure and demanding $85,000. The items the buyer accuses us of withholding were not discovered by any of the inspections, and my husband and I knew nothing about them. We are now involved in mediation, which is costing us legal fees and time. Our lawyer says that usually all named parties (inspectors, real estate agents and us) contribute to the settlement. My husband and I are outraged by the process. We do not agree to any settlement. What prevents any buyer with remorse from accusing the seller of nondisclosure? -- Connie S.

DEAR CONNIE: The situation you describe is called a shakedown. You are the victims. Mediation is usually a simple one-day procedure and should not be expensive. If that doesn't result in an acceptable solution to the dispute, then the buyers can sue you.

After you win that lawsuit, then you can bring a "malicious prosecution lawsuit" against the buyers to recover your costs for suing you on a groundless claim.

DEAR BOB: Our kids want us to have an in-ground swimming pool built in the back yard. A few neighbors have them, but most nearby houses do not. It would cost at least $25,000, maybe more. Do you think a swimming pool would be a good investment? -- Janice P.

DEAR JANICE: No. You would be very fortunate if the swimming pool adds as much market value to your home as it costs. Unless you live in a hot climate where most homes have swimming pools, my best advice is tell your kids to make friends with someone who has a pool.

In fact, swimming pools can be a detriment when you decide to sell your home. Many families with small children refuse to consider buying a house with a swimming pool because of the drowning danger. Also, pools and their equipment can be very expensive to maintain.

Readers with questions should write Robert J. Bruss at 251 Park Rd., Burlingame, Calif. 94010, or contact him via his Web page, www.bobbruss.com.

© 2006, Inman News Service