What to Expect at a Real Estate Closing

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Real Estate Closing

You’ve made an offer on your first home and it’s been accepted. You’ve started planning your move and your agent has given you a date for “closing.” What does that mean and what should you expect at that meeting?

What Is a Real Estate Closing?

Real estate transactions are, by their nature, highly complex and document-driven. In addition to the buy-sell agreement, which sets forth the obligations of both parties, you’ll have a mortgage (unless you pay cash), a note, title documents, a deed and perhaps an easement or restrictive covenant. The closing brings all the parties together at the same time, so that all contingencies can be immediately addressed and resolved. There’s a simultaneous exchange of documents, so that all parties’ interests are protected.

The closing will typically take place at either a title office or at the office of one of the real estate agents involved in the transaction. All documents required to complete the transaction will be part of the closing package and the parties will sign those documents in the presence of a notary. The seller will receive a check for the purchase price less any amount still owed on a mortgage, as well as any other obligations the seller has agreed to pay. The buyer will receive the deed to the property, though the buyer’s lender may have a lien on that deed.

As a general rule, a closing or settlement statement is prepared in advance, identifying what funds will be exchanged and who will receive what. You should have the opportunity to review the closing statement in advance, so that any discrepancies can be resolved before the closing.

Contact Our Office

At Barnard, Mezzanotte, Pinnie, Seelaus & Kraft LLP, we have provided thorough and effective legal counsel to clients throughout Delaware County in Pennsylvania since 1980. We offer a free initial consultation. To schedule an appointment, call us at 610-565-4055 or 302-594-4535 or contact us online.

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Should You Set Up a Trust?

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Set Up a Trust

If you’ve started to plan for the orderly distribution of your estate in the event of your death, you’ve probably wondered about whether or not a trust is right for you. This blog helps you understand what a trust is, why it can benefit you, and its advantages and disadvantages.

To understand the benefits of a trust, you need to have a basic understanding of the probate process. The probate process seeks to ensure the orderly distribution of property that you own upon your death. There are two primary ways that you can have the use of property, but not own it at the time of your death—through re-titling assets and through a trust. If you change the legal title to property, such that you own it jointly with anyone else, the property automatically passes to the joint owners at the instant of your death, and any property interest you had is extinguished.

A trust works a little differently. In essence, a trust is a separate legal entity, into which you can transfer property. When you transfer property into a trust, you relinquish ownership of the property, but have use and enjoyment of it as set forth in the terms of the trust. Typically, you’ll have what is known as an “inter vivos” trust, one that becomes effective while you are still living. Any property that you put in the trust during your lifetime stays in the trust when you die—accordingly, there’s no need to address the ownership or distribution of the property when you die, as you don’t own it.

The obvious advantage to putting property in trust is that you avoid the probate process, which can be expensive and time-consuming. As a general rule, you’ll pay a bit more up front for the preparation and execution of the trust, but it’s usually far less than the estate would pay if the property went through probate.

Contact Our Office

At Barnard, Mezzanotte, Pinnie, Seelaus & Kraft LLP, we have protected the rights of individuals throughout Delaware County since 1980. We offer a free initial consultation. To schedule an appointment, call us at 610-565-4055 or 302-594-4535 or contact us online.

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The Dangers of Elder Financial Abuse

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Though studies show that the rates at which elder Americans have been victims of financial abuse has dropped since 2010, seniors still remain vulnerable to fraudulent acts, from investment advisors, family and complete strangers. A report from the Investor Protection Trust found that 17% of individuals over the age of 65 admitted that they had been victims of some financial abuse.

In one of the most high-profile instances of senior financial abuse, prosecutors charged Michael Donnelly, former president of Coastal Investment Advisors, Inc., with bilking seniors and others out of more than $2 million. They say that he instructed clients to make checks payable to Donnelly Advisors Group, then cashed the checks and used them for his own personal expenses, including the private tuition for his children. He also fabricated investment reports, statements and trade documentation.

Donnelly settled the civil lawsuit related to the fraudulent behavior last fall, agreeing to pay $1.99 million in restitution. Earlier this year, he pled guilty to securities and wire fraud. A federal court in Philadelphia sentenced him to spend more than eight years in prison, to be followed by three years of supervised release.

Nearly 10 years ago, Anthony Marshall, the son of former New York socialite Brooke Astor, was convicted of stealing tens of millions of dollars from his elderly mother during her latter years. Marshall’s son, Philip, who testified against his father in a six-month criminal trial, said that his grandmother was only one of many seniors who are taken advantage of by children, financial advisors and others. Philip Marshall now travels the country speaking as an advocate for reforms that would provide better protection for seniors in financial affairs.

Contact Our Office

At Barnard, Mezzanotte, Pinnie, Seelaus & Kraft LLP, we have protected the rights of individuals throughout Delaware County since 1980. We offer a free initial consultation. To schedule an appointment, call us at 610-565-4055 or 302-594-4535 or contact us online

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Restrictive Covenants in Real Estate

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Covenants in Real Estate

In recent years, it’s become a practice for many real estate agreements to contain restrictive covenants—provisions that place limits on the future use of the property. Often, these limitations involve aesthetic matters, such as choice of color for the exterior of a home or the erection of a fence. If the covenant is included in the deed to the property, it may be enforceable against future buyer/owners as what is known as a “covenant running with the land.” Are all restrictive covenants enforceable? What legal prohibitions may be applied to restrictive covenants?

As a general rule, covenants related to real estate are enforceable unless they are what are known as “exclusionary” covenants, designed to prevent people from purchasing real estate because they belong to some protected class—women, minorities, the disabled, etc. Exclusionary covenants were common in the United States in the early 20th century, but were banned by the U.S. Supreme Court in 1949.

In order to be enforceable against subsequent owners of property, a restrictive real estate covenant must meet a number of tests:

  • The covenant must comply with the statute of frauds, which identifies what contracts must be in writing to be enforceable
  • The parties to the original transaction must have intended that all future owners be limited by the covenant
  • The covenant must involve the use or enjoyment of the physical property and cannot relate to any characteristic of the owner
  • Anyone purchasing the property must have been notified of the covenant at the time of purchase

Covenants may prohibit owners from engaging in some action related to the land, such as installing a hot tub, or they may require that property owners take certain actions, including keeping lawn and grounds manicured.

Contact Our Office

At Barnard, Mezzanotte, Pinnie, Seelaus & Kraft LLP, we have provided thorough and effective legal counsel to clients throughout Delaware County in Pennsylvania since 1980. We offer a free initial consultation. To schedule an appointment, call us at 610-565-4055 or 302-594-4535 or contact us online

Personal Service | Dedicated Advocacy | Cutting Edge Technology