Dear Michael: My dad who has a tourist visa and is not a U.S citizen is interested in purchasing income property in the U.S. He understands as a foreigner that he will have to buy it out right “all cash”. Is it safe to buy something if you are not a citizen? And will he be able to put my mom on title in the future?
Answer: Is your dad a resident? Does he have a green card? If not, he will not be able to get a loan and therefore will indeed have to buy the property “all cash”. Your dad will need do a “Quit Claim Deed” if your mom wants to be added to title. She can do this without residency but will need her passport as identification. There are Co. that can help you with this, they charge about $200. You can find them online. You can also do it yourself but be careful; if you make any mistakes they will reject the application. Management co. are a good alternative if you are out of the country. They charge about 5 percent to 6 percent of your gross annual income. You can also manage yourself. It is my experience that a property is always best managed by the owner, and with today’s technology it is very easy to manage from abroad. You can just have your tenants pay the rent online banking and have a good handyman available for repairs when need be. If repairs are paid by the tenants then you can have the amount deducted from the rent. If you are going to take this route, make sure to ask your tenants for receipts.
Dear Michael: After looking for months, we finally found a home we could afford. Unfortunately, the home inspection revealed a number of defects that weren’t apparent at the time we agreed to buy the property. While we have the right to walk away without penalty, we prefer to work out a solution. What are some of our options?
Answer: Though sellers must disclose all known defects to buyers, there are certainly circumstances where the seller did not know of the defect or the defect wasn’t easily visible. Since you want to resolve this situation, your first step is to review your home inspection report, prioritizing the major repairs. Second step, is to solicit several bids from contractors on the cost of the repairs. Third step is to re-negotiate with the seller for a credit or require the seller to make the necessary repairs. As with the initial purchase negotiations, you may receive counter proposals from the seller. Whether the seller will agree to pay for the items may depend on the terms of the contract and the current market and price of the property. If you cannot come to an agreement with the seller, I suggest you just move on to another home or simply pay for the cost of the repairs. Keep in mind that repairs can be fixed over time.
Dear Michael: Our escrow Co. is telling me that they need to record title before we can claim ownership. What is recording Title all about?
Answer: When you purchase real property (home), you will receive a written document called “the deed” which transfers the ownership title of the property to you as the purchaser. The deed gives you formal title in exchange usually for a specified amount of money. The conveyance of real property is not complete until the deed is delivered to you or your authorized agent. When you get the deed, it is recorded with the county recorder in the county where the property is located. The purpose of recording the deed is to give notice that you now have an ownership interest in that particular piece of real property. Recording also tracks the chronological chain of title. Anyone who wants to know who owns a piece of real property can check the records of the county recorder for the county where the property is located. Before you purchase real property, you can follow the chain of sales and transfers of the property, from the original grant deed of the land, all the way to the current owner. When title insurance is purchased, the title insurer checks the change of title to determine whether any defects or liens occurred in prior conveyances and transfers, defects may then be pointed out and excluded from coverage.
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 e-mail them to him at: homes@agentmichael.com
