Dear Michael: We are buying a home which we are told is Fee Simple. What does “Fee Simple” mean?
Answer: Fee Simple is a legal form of ownership. This is the most common form of real estate title. In a fee simple ownership, you have “absolute ownership” subject to basic government rights such as taxation and subject to deed restrictions. The most common restrictions, easements, and / or encumbrances include public utility easements, neighborhood restrictions such as building set-back lines, and water / wastewater easements. The vast majority of homes are held “Fee Simple.” If you obtain financing to purchase a home, the lender will probably require a title policy. These should describe any of these restrictions and rights of way. Adverse easements and violations should also be disclosed by a seller when a property is sold if the seller is aware of such.
Dear Michael: I am in escrow on a short sale property. The bank has approved the sale. Can we still negotiate the price after the bank has agreed to our price?
Answer: Short sales (for the most part) are usually sold at a reduced price and therefore have very little room for negotiation. A BPO agent (Brokers price opinion) who is hired by the short sale lender has to physically evaluate his opinion on the accepted price between buyer and seller. The file is then transferred to a bank negotiator for price approval. Unless you can show a considerable drop in prices in the area you are buying, once the bank negotiator sets the selling price for a property it becomes very difficult to re-negotiate that price. If you plan on challenging the approved price you will need to make sure you have a few comparable properties to sustain your argument. A short sale purchase contract between a seller and a buyer is not a definite set price until the bank approves it. Sometimes the short sale bank will reject the accepted price and set a higher price if they feel that the property is being sold to low in retrospective to the comparable homes in the area.
Dear Michael: I sold my home without a Realtor about one year ago. At the time of the sale my plumber checked the plumbing and everything was fine. The buyer then agreed to purchase the home as is. The buyer is now asking for a refund of $1,500 for plumbing repairs relating to water pressure. No forms were use to keep track of acknowledgements when the transaction was done.
Answer: Although your situation does not seem very threatening at this time, it can possibly have a domino effect that could lead to lawsuits. This is one of the many reasons why a Realtor should be used when selling a home. To answer your questions, if your plumber checked the water pressure and everything was fine, then your invoice may or may not save you. The buyer never did sign an acknowledgement and therefore may say that they never saw the invoice and where not told that the plumbing was working fine. If this is the case it would be your word against the buyer. A physical inspection should always be done and a “request for repairs” should have been submitted in writing from the buyer requesting specific repairs. Signatures would have served as proof that the matter was resolved and accepted by both parties. For all real estate transaction, one rule of thumb: everything must always be done in writing!
Michael Kayem is a Realtor with Re/max /Execs serving Culver City and the Westside since 2001. You can contact Michael with your questions at 310-390-3337 or email them to him at: homes@agentmichael.com
