ARTICLES & NEWS

REAL ESTATE CONTRACTS ARTICLES

homebuild and blueprint

Home Builders Require Mediation And Arbitration

By Christopher Combs | August 2, 2020

Question: We signed the builder’s purchase contract to buy a new home in the San Tan Valley. The builder’s sales agent made numerous false statements, especially in regard to the upgrades that were available in the home. The “bottom line” is that we canceled the purchase contract and demanded our $20,000 earnest money back. The builder refuses to give the $20,000 earnest money back to us. In addition, the builder demands reimbursement for the $28,000 cost of upgrades that the builder says are worthless to any new buyer of the home. Under the builder’s purchase contract we are required to…

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Mortgage repayment failure

Statute of Limitations for HELOCs

By Christopher Combs | July 26, 2020

Question: When we bought our Chandler home in 2006, we got a 30-year first mortgage with Bank of America, and a Wells Fargo $100,000 second mortgage home equity line of credit (“Wells Fargo HELOC”). We used this $100,000 for a swimming pool and for landscaping in our back yard. In 2011 we both lost our jobs and we had financial difficulties. Although we were able to keep our first Bank of America mortgage current, we stopped paying our Wells Fargo HELOC. Last week we received a letter from an attorney that our Wells Fargo HELOC balance is $160,000, and that…

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Text Message

Texts Between Seller and Buyer can be a Purchase Contract

By Christopher Combs | July 5, 2020

Question: We wanted to buy a beautiful home in Sedona. The problem during the negotiations for the purchase of this home was that we live in Phoenix and the seller lives in Texas. Neither of us were represented by brokers. Most of our negotiations with the seller were by texts between the seller and us. The major terms of the purchase contract were in these texts: the purchase price, the closing date, the name of the escrow company, and that there would be no financing. Each of the seller’s texts had the seller’s name and address at the bottom of…

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For Rent

Six-Month Lease with Right to Cancel After One Week is a Short-Term Rental

By Christopher Combs | June 28, 2020

Question: Our Chandler HOA has a CC&R that prohibits short-term rentals of a home for less than six months. The six-month lease that our lawyer drafted included a provision that allowed the tenant to cancel the lease and move out with one week’s notice. Our tenant signed this six-month lease, and at the same time gave us the one-week notice to move out. After our tenant moved out one week later, a neighbor complained to the HOA that this six-month lease was actually a short-term rental of one week. The HOA agreed with the neighbor, and fined us $500 per…

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Garage

Confirm Not Only Permit Issued But Construction Completed

By Christopher Combs | June 21, 2020

Question: When we purchased our East Valley home, the Seller’s Property Disclosure Statement (“SPDS”), line 150, said that there was a permit from the City of Chandler for the construction of the 2,000-square-foot detached garage. The SPDS, line 155, said that the detached garage had been “completed.” We want to use this detached garage for our collector cars and for an art studio. We recently learned, however, that although a permit from the City of Chandler was granted to build the detached garage, there was never a certificate of completion for the detached garage from the City of Chandler. For…

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cabin

Short-Term Rentals Continue To Cause Confusion

By Christopher Combs | June 14, 2020

Question One: In a recent column you said that a short-term rental in Scottsdale is getting “up to $20,000 per month.” That seems irresponsible to say the least. I take exception to you promoting the success of short-term rentals because these short-term rentals are such a problem here in Sedona, and I have never, nor will I ever, manage them. Our local community is suffering because of the recent state law SB 1350 prohibiting Sedona and other local communities from regulating short-term rentals. Answer: Thank you for your comments. Other readers, however, think that I am opposed to short-term rentals.…

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Morgage transfer

Will My Children Owe Mortgage Balance In Full When I Die?

By Christopher Combs | May 31, 2020

Question: I own three rental properties in Surprise. Each one has a bank mortgage with a “due on sale” clause, i.e., the mortgage must be paid in full upon any transfer of the rental property. My revocable living trust states that my three children become the owners of these three rental properties upon my death. Will the “due on sale” clause in each of these mortgages require my children to pay the entire mortgage balances on these rental homes when I die? Answer: No. Under a 1982 federal law there are exceptions to the enforcement by mortgage lenders of standard…

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hillside view

Deed Restriction to Protect Hillside View

By Christopher Combs | May 10, 2020

Question: Our Estrella Mountain home was one of the first homes sold in our development. The lot behind us has still not sold. If a home is built on this lot, our beautiful hillside view will be spoiled.  Our thought is that we would contact the developer for an agreement to limit to one-story any home built on this lot. Can we pay the developer some amount of money to limit this lot to one-story homes? How long could the time period be? Answer: You could pay the developer for a recorded deed restriction to get a view easement over…

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