Category: Resources

DEEDS: DIFFERENT WAYS TO TRANSFER OR ACQUIRE REAL ESTATE.

DEEDS: DIFFERENT WAYS TO TRANSFER OR ACQUIRE REAL ESTATE.

If you are buying or selling a home, the Deed is one of the most important documents.  The Deed is the only document that actually transfers title to the property from you (as a seller), or to you (as a buyer).  Four of the more common types of Deeds that you may see are a 1) Quit Claim Deed, 2) Warranty Deed, 3) Special Warranty Deed, and 4) Deed in Trust/Trustee’s Deed.

A Quit Claim Deed merely removes an individual from a property’s title.  In other words, the individual that executes a Quit Claim Deed is simply disclaiming any interest in the property.  The individual obtaining the property via the Quit Claim Deed receives no assurances or warranties as to ownership, or whether the property is free of the interests of any third parties.

Quit Claim Deeds are not generally used in real estate transactions.  The contract between the buyer and seller often requires that the seller provide the buyer with “clear and marketable title.”  A Quit Claim Deed does not deliver clear and marketable title because it makes no warranties as to property ownership or any encumbrances on the property.

The Warranty Deed is a more common method of conveyance in a real estate transaction.  Under Illinois law, any deed that simply states that “seller warrants to buyer,” is guaranteeing the buyer that 1) the seller is the lawful owner of the property, 2) the property is free from encumbrances, 3) the buyer is entitled to possession of the property, and 4) the seller will defend the buyer in court against certain claims to the property.  If you are purchasing property, ensure that you are receiving a Warranty Deed.

Special Warranty Deeds are less common, but you may encounter one if you buy property from a bank that recently foreclosed on certain property.  The Special Warranty Deed only provides guarantees during the time that the bank owned the property.  It does not provide any warranties related to the time period when the previous owner, who lost his or her interest due to foreclosure, owned the property.

Finally, both buyers and sellers of property may see conveyances that are labeled as a Deed in Trust or a Trustee’s Deed.  A Deed in Trust is simply one that conveys the property into a certain trust.  A Trustee’s Deed is a conveyance from the trustee of a certain trust, to another individual or entity.  Both a Deed in Trust and a Trustee’s Deed can be either a Quit Claim Deed, or a Warranty Deed.  You can tell the form of the conveyance by whether the Deed in Trust or Trustee’s Deed states that “seller quitclaims to buyer” or that “seller warrants to buyer.”  Based on that language, the Deed in Trust or Trustee’s Deed will contain the same basic characteristics of a Quit Claim Deed or a Warranty Deed.

EJECTMENT LAWSUITS: OR, “GET OFF MY PROPERTY.”

EJECTMENT LAWSUITS: OR, “GET OFF MY PROPERTY.”

In Illinois, it is not unusual for two or more parties to fight over who is the rightful owner of real estate, and as the owner has the right to possession of that real estate.  When this happens, one party may file a lawsuit for “ejectment.”

An ejectment action asks a court to determine the property’s rightful owner.  If the party possessing the land is determined to not be the rightful owner, the court will “eject” that party from the property so that the rightful owner can take possession.

The party bringing the ejectment litigation is called the “Plaintiff.”  The Plaintiff must demonstrate to the court that he obtained title to the property and subsequently took possession of that property.  Then, that the other party, called the “Defendant” took possession of the land.  Finally, the Defendant continues to unfairly possess the property by occupying it.

The best way for a Plaintiff to show a court that he obtained lawful title to property is to produce a deed that conveys the property to the Plaintiff.  However, there may be other ways for the Plaintiff to establish that his right to possession of the property is “better” than that of the Defendant.  It is a good idea to consult an attorney if you believe you have right to possession of land that another party is occupying.

Keep in mind that the other party’s improper possession may not be total possession of your property, but only a portion of that property.  For example, if your neighbor were to build something on your property without your permission, an action for ejectment may be appropriate.  Your neighbor is possessing your whole property, but he is unlawfully possessing a portion of it.

Having a good attorney can help further understand if an ejectment lawsuit may be appropriate in a certain situation.

Local attorney Andrew Szocka is experienced in many real estate matters, including ejectment actions.  In addition, Andrew provides thorough and speedy estate planning, probate, and business organization help in the Chicagoland area.  To schedule a free initial consultation, visit the Law Office of Andrew Szocka, P.C. online or call the office at (815) 455-8430.

 

Do You Need a Will If You Already Have Life Insurance?

Do You Need a Will If You Already Have Life Insurance?

If you already have life insurance, you may wonder why people keep saying that you need to make a will. Life insurance sounds like it will help your family out if you are not around. There are many reasons to make a will in addition to paying for life insurance.

  1. Life Insurance Provides a One-Time Payout to One Person

Life insurance requires you to make premium payments to an insurance company over time. If you pass away while the policy is in effect, the insurer will pay a lump sum to your chosen beneficiary. You can choose one or maybe more beneficiaries, but they only receive one payment. Depending on the type of policy, your family may only receive enough money to replace your income or pay expenses for a year or two. After that, the insurance will no longer help them.

In contrast, you can use a will to make gifts to many people. You are not limited to one or a few beneficiaries. Further, you can even use a will to roll your assets over into a trust. The trust can make payments to your family over time, and the trust assets may even grow in value.

  1. No Premium Payments or Term Required for a Will

To maintain life insurance, you have to make premium payments on a regular basis. These payments may not seem expensive at first. But if you fall on hard times, you could lose the insurance. You do not need to make regular payments to “afford” a will. Once you and your witnesses sign it, it will remain in effect until you die or change the will.

Further, many younger people purchase term life insurance, which stays in effect only for a specified term (such as 10 years). After the term ends, you are no longer covered. Older people often buy policies that last longer but end up costing a lot of money in premiums. Again, a will stays in effect for as long as you want with no extra cost.

  1. Dispose of All Your Assets with a Will

Life insurance assures a payment from the insurance company to a beneficiary. It has no effect on distribution of your assets after you die. You may not think you have many assets to distribute. But if you have a house, own stock, have valuable jewelry, or own a car, you have assets. Further, you might want those assets to go to specific people after you are gone. A will can give you peace of mind that your wishes will be carried out.

Want to start planning your estate? Local attorney Andrew Szocka, Esq. provides thorough and speedy estate planning help in the Chicagoland area. To schedule a free initial consultation, visit the Law Office of Andrew Szocka, P.C. online or call the office at (815) 455-8430.

PURCHASING OR SELLING A HOME: HOW TITLE INSURANCE RELATES TO THE TRANSACTION

PURCHASING OR SELLING A HOME: HOW TITLE INSURANCE RELATES TO THE TRANSACTION

If you bought or sold a home, you almost certainly worked with a title insurance company.  But you may not fully understand the reason for the company’s involvement, or how the company protects both the buyer and seller in the transaction.

If you are the seller, a typical real estate sale contract requires you to provide your buyer with an “owner’s title insurance policy.”  This is an insurance policy that protects the buyer from any problems that exist related to the real estate’s title history.

Your attorney will work with the title company to study the real estate’s title history.  The title history for real estate property should be free of any liens, encroachments, or other issues that would delay the sale.  In that case, the sale may proceed without delay.  However, often times your attorney and title company may discover a “title defect.”

Title defects come in many forms.  As a seller, you may have paid off a previous mortgage on your home, but the bank that held the mortgage did not advise the local county government that the mortgage was satisfied and should be removed from the property’s title history.  Or perhaps you built a work shed, fence, or installed a swimming pool over a utility company easement that runs along your property.

Mortgages that you paid off can often be resolved by talking to the bank that held the mortgage but failed to contact the local government to have the mortgage removed from the property’s title.  A structure built on a utility easement may be more complicated.

Depending on the type of structure, the title insurance company may provide insurance to your buyer that covers any damages your buyer may incur as a result of the structure.  For example, if a cable company wanted to dig under a fence to repair wires, the insurance company would pay to remove and replace the fence.  An insurance company may not cover your buyer’s cost to remove and replace a more permanent structure, such as a swimming pool.  As a result, the insurance company would indicate on your buyer’s new owner’s insurance policy that the pool’s encroachment on the utility easement is “excepted,” or not insured, by the policy.

If you are purchasing a home or piece of property, you should be sure to review, and have your attorney review, the real estate’s title history.  The history will reveal any title defect, like a lien or encroachment.  If there are utility easements that run along the property, you should be aware not to build a fence or other structure that covers that easement.

As a buyer, you will almost always have the option to decline to purchase property based on a title defect that you find unacceptable and if the defect cannot be cured.

Having a good attorney can help further understand how the title insurance company works with that attorney to ensure you know the risks, if any, related to certain real estate.  This is true whether you are buying or selling.

Planning on buying or selling property?  Local attorney Andrew Szocka provides thorough and speedy real estate, estate planning, and business organization help in the Chicagoland area.  To schedule a free initial consultation, visit the Law Office of Andrew Szocka, P.C. online or call the office at (815) 455-8430.

 

CONDOMINIUM LIENS: WHAT EVERY CONDOMINIUM OWNER SHOULD KNOW

CONDOMINIUM LIENS: WHAT EVERY CONDOMINIUM OWNER SHOULD KNOW

If you are a member of a condominium association, or thinking about purchasing a condominium, it is important that you understand condominium assessments and liens.  Condominium associations typically have monthly assessments, which is a monthly payment that each member makes to the association.  Monthly assessments are used by the association to maintain common areas, which are areas in the association where all members share an ownership interest.  This could be a lobby, pool, or garden.

A condominium may also assess a special assessment.  This special assessment is usually a way for an association to pay for a large repair or improvement project, the cost of which the monthly assessments would not cover.

Associations provide themselves the power to collect monthly and special assessments when they are formed.  Condominium formation includes the drafting of a Declaration of Covenants, Conditions, and Restrictions (“Declaration”).  If you own a condominium, you should familiarize yourself with your association’s Declaration.  If you are planning to purchase a condominium unit, you will receive a copy of the association’s Declaration prior to the actual closing.

The Declaration will almost always allow the association to set monthly and special assessments that each member of the association must pay.  In addition, the Declaration will nearly certainly state that any individual that owns property included in the association is an association member, and responsible for payment of the monthly and special assessment.  Finally, the Declaration will provide processes that the association can use to collect unpaid monthly and special assessments from its members.

Although the Declaration provides for an association’s collection means, association collection of unpaid assessments is also supported by Illinois law.  The Illinois Condominium Property Act (765 ILCS 605/9(g)) states that any unpaid monthly or special assessments that are unpaid by a unit owner, shall be a lien on that unit owner’s property.  The amount of the lien includes interest, late charges, and attorney fees that the association spends in an effort to collect the unpaid assessments.

The association’s lien on your property is superior (prior in right) to any other liens recorded against your property, except 1) your first mortgage and 2) any unpaid local, state, or federal taxes.  If you have a second mortgage on the property, the association’s lien can obtain priority over that mortgage if it meets certain requirements within the Illinois Condominium Property Act.

If you have a condominium lien on your property, you will want to resolve it by paying the unpaid assessments.  Otherwise, you will not be able to sell your condominium, or the association may foreclose its lien and be entitled to even more interest, late charges, and attorney fees for which you will be responsible.

Planning on buying or selling a condominium?  Or concerned about a condominium lien on your property?  Local attorney Andrew Szocka provides thorough and speedy real estate and estate planning help in the Chicagoland area.  To schedule a free initial consultation, visit the Law Office of Andrew Szocka, P.C. online or call the office at (815) 455-8430.