Is Your LLC or Corporation Current & Updated?
Posted on | April 5, 2010 | 1 Comment
Limited liability entities- such as corporations and limited liability companies- require basic maintenance. Yet, amazingly, a large percentage of Indiana corporations and Indiana LLC’s are not updated by management or owners. What they risk by failing to upkeep these entities is nothing less than having a court ignore the “corporate shield” by applying liability directly on the owners of the corporation or LLC.
It is not expensive or hard to maintain an Indiana corporation or Indiana LLC. The necessary tasks should begin with a visit to your business attorney, CPA and insurance agent. However, those are just the three most important tasks to complete. There are several others.
Here is a short list of important tasks to complete regularly-
- Visit yourIndiana business attorney to review the corporate records and status of the business.
- Visit your CPA for a review of the financial health of the company.
- Visit your insurance agent to contact a full insurance review.
- Hold an annual meeting of the owners- members in an LLC and shareholders in a corporation. Elect LLC-managers or corporate directors at these meetings.
- Hold an annual meeting of the directors in a corporation. Elect officers at this meeting.
- Create minutes of all annual meetings.
- File biennial reports with the Secretary of State.
- Update an assumed business names with appropriate filings with the Secretary of State and county recorder.
- Remind officers and key personnel on the appropriate operations of a limited liability entity.
- Review all contracts, processes and procedures that might lead to liabilities.
- Conduct a risk audit, which should include a physical inspection of your business facilities.
Of course, each business has unique needs, but this list generally applies to businesses of all types and sizes.
Avoid Collection Problems- How to Get Paid by Your Clients
Posted on | March 27, 2010 | 2 Comments
Businesses often experience difficulties in collecting monies owed to them by their customers and clients as soon as the business first begins offering its goods and services. Every business has experienced some difficulty in getting paid all it is owed, and many business plans are formed with the presumption that a certain percentage of the business’ accounts receivable will go uncollected. The problem of collecting accounts receivable is not usually the cause of a business’ failure, as more businesses fail from undercapitalization. However, collections problems can prevent a business from growing and will always negatively affect the business’ profitability.
There are things a business can do to minimize its risks that an account receivable will become uncollectible. And as is usually the case, preventing the problem from occurring is far less costly than curing the problem once a client or customer fails or refuses to pay you for your goods and services. Whether your business is the sale of pastries, providing rental housing or the construction of high-rise office buildings, the following suggestions, where applicable, should help you increase your collections and avoid much frustration and anguish in the process. Try following these basic collections rules.
Get It In Writing.
It may sound elementary, but it is so very important that you memorialize your agreements with customers, clients and other businesses. Any change, termination or other modification of an agreement should also be memorialized. For example, in a construction context, a “Change Order” form may often be used. To avoid a variety of legal and tax trappings, all written documents, including your regularly used forms, should be reviewed by your legal counsel and tax advisors.
Get Paid In Advance.
Easier said than done, but your goods and services are not free. You should require substantial deposits and down payments before you begin ordering parts or using materials. And you should require payment-in-full before you begin performing services or relinquish control of your property. Remember that until your customer has paid you for a good, the customer is not entitled to the fruits of your labor. This rule may best be exemplified by the landlord who demands rent to be paid on the first day of every month during which the tenant will occupy the leased premises. In essence, the tenant pays in advance. But when the tenant fails timely to make the rent payment, the tenant is essentially a trespasser and the landlord should immediately begin eviction proceedings.
If You Don’t Get Paid In Advance, Get Security.
Obviously, this rule does not apply to leasing agreements or the simple cash transaction such as the sale of a dozen doughnuts. In larger transactions, particular those involving the sale of moveable personal property and real estate, the seller should demand a security interest in something of value. A mortgage, a recorded land contract, a mechanic’s lien and a lien on personal property are familiar examples of security interests. But many people forget that a business can agree to provide services, such as structural repairs to a house, and in exchange receive a security interest in an entirely different property, such as an office building, delivery truck or car owned by the customer. Or alternatively, that same business could require a security interest in the house, office building, delivery truck and car, or some combination thereof. Having a security interest may also improve your chances of recovery in the event the customer files for bankruptcy protection.
If The Customer is Credit Risky, Demand A Co-Guarantee.
Many businesses extend credit to customers while fearing that the customer is a credit risk. In such circumstances, the customer should be made to provide the signature of a co-guarantor who promises to pay the customer’s debt to you in the event the customer does not. Remember, however, that the co-guarantee is only as good as the co-guarantor is creditworthy.
If Your Contract Does Not Allow For Collection Costs,
You Connot Get Them.
The “American Rule” is that litigants pay their own attorneys’ fees. So, if you must retain an attorney to collect a debt, you will pay the attorneys’ fees and most other collections costs. The exceptions to the American Rule are the existence of a written contract allowing the recovery of attorneys’ fees, a statute allowing such recovery; or the assertion of a frivolous, unreasonable or groundless claim or defense. The easy solution to the American Rule is to include a provision in your contracts allowing YOU to recover your attorneys’ fees, collections and court costs. Your customers should not have the same right to recover against you.
The Check Is Never Truly In The Mail.
The lesson here is to begin legal proceedings as soon as possible and not to delay in collecting your money or retrieving your property. Equally important, you should read your written agreements to determine whether you are required to provide any notices or demands to the customer before commencing a collections action against the customer. The longer you wait, the more likely the customer will be difficult to locate; the customer will have been hidden his/her assets; or your property will have been destroyed, devalued or transferred to third-parties.
As a final suggestion, consult your attorneys as soon as you suspect difficulty in collecting a debt. Often a stern letter from an attorney on a law firm’s letterhead can have a dramatic effect on a delinquent customer. You also should consider consulting your attorneys to review your entire billing and collections processes. Thrasher Buschmann Griffith & Voelkel, P.C. has often assisted businesses whose agreements, leases and other forms were outdated or lacking important provisions which would allow the business to pursue additional remedies against a delinquent customer. If we can help you or your business, please contact this author.
Businesses Must Protect Confidential Data
Posted on | March 17, 2010 | No Comments
In an effort to protect the privacy of consumer information and reduce the risk of fraud and identity theft, a federal rule requires businesses and landlords to take certain protective measures to dispose of sensitive information derived from consumer reports. Any business or individual who uses a “consumer report” for a business purpose is subject to the requirements of this Disposal Rule. The Rule requires the “proper” disposal of information in consumer reports and records to protect against unauthorized access to or use of the information. The Federal Trade Commission (FTC) has the responsibility to enforce the Disposal Rule.
In a property management context, a consumer report includes tenant credit and other such reports generated by consumer credit reporting agencies (CRA’s), such as tent screening agency. A consumer report does not include information gathered directly by business for use by the business. Below, I have included more information about what constitutes a consumer report.
The FTC has indicated that the standard for the proper disposal of information derived from a consumer report is flexible, and allows organizations and individuals covered by the Rule to determine what measures are reasonable based on the sensitivity of the information, the costs and benefits of different disposal methods, and changes in technology. Although the Disposal Rule applies to consumer reports and the information derived from consumer reports, the FTC and this author both encourage those who dispose of any records containing a consumer’s personal or financial information to take similar protective measures. In other words, treat all customer and client information as if they are subject to the Disposal Rule.
Who must comply?
The Disposal Rule applies to individuals, as well as large and small organizations, that use consumer reports. Among those who must comply with the Rule are:
• Consumer reporting companies
• Lenders
• Insurers
• Employers
• Landlords
• Government agencies
• Mortgage brokers
• Automobile dealers
• Attorneys or private investigators
• Debt collectors
• Individuals who obtain a credit report on prospective nannies, contractors, or tenants
• Entities that maintain information in consumer reports as part of their role as service providers to other organizations covered by the Rule.
What information does the Disposal Rule cover?
The Disposal Rule applies to consumer reports or information derived from consumer reports. The Fair Credit Reporting Act defines the term consumer report to include information obtained from a consumer reporting company that is used – or expected to be used – in establishing a consumer’s eligibility for credit, employment, or insurance, among other purposes. Credit reports and credit scores are consumer reports. So are reports that businesses or individuals receive with information relating to employment background, check writing history, insurance claims, residential or tenant history, or medical history.
What is ‘proper’ disposal?
The Disposal Rule requires disposal practices that are reasonable and appropriate to prevent the unauthorized access to – or use of – information in a consumer report. For example, reasonable measures for disposing of consumer report information could include establishing and complying with policies to:
• burn, pulverize, or shred papers containing consumer report information so that the information cannot be read or reconstructed;
• destroy or erase electronic files or media containing consumer report information so that the information cannot be read or reconstructed;
• conduct due diligence and hire a document destruction contractor to dispose of material specifically identified as consumer report information consistent with the Rule. Due diligence could include:
o reviewing an independent audit of a disposal company’s operations and/or its compliance with the Rule;
o obtaining information about the disposal company from several references;
o requiring that the disposal company be certified by a recognized trade association;
o reviewing and evaluating the disposal company’s information security policies or procedures.
The FTC says that financial institutions that are subject to both the Disposal Rule and the Gramm-Leach-Bliley (GLB) Safeguards Rule should incorporate practices dealing with the proper disposal of consumer information into the information security program that the Safeguards Rule requires (ftc.gov/privacy/privacyinitiatives/safeguards.html).
The Fair and Accurate Credit Transactions Act, which was enacted in 2003, directed the FTC, the Federal Reserve Board, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, the Office of Thrift Supervision, the National Credit Union Administration, and the Securities and Exchange Commission to adopt comparable and consistent rules regarding the disposal of sensitive consumer report information. The FTC’s Disposal Rule became effective June 1, 2005.
ONE OF THE BEST PEOPLE YOU’LL EVER MEET- MICKEY BROOKS
Posted on | March 16, 2010 | 1 Comment
Mickey Brooks is an Indianapolis-based mortgage consultant. He is probably the most knowledgeable mortgage broker I’ve ever met, and I am honored that he posts answers in my blog. What an asset on my team!
It is no wonder that the guy was named the 2009, Rainmaker of the Year by Rainmaker Marketing Group. The guy is a great businessman, and wonderful human being. It’s a joy knowing him.
I referred a client to Mickey recently, and he went out of his way to help this lady. Mickey’s advice, instructions and guidance will probably save this lady $1,000′s on her existing mortgage.
What will Mickey get out of it?
Nothing. Not a thing.
He worked himself out of a fee, because it was the right thing to do. He helped by sacrificing.
Will I continue to send Mickey business?
You better believe it. He makes me look great to my clients, because he over-delivers.
Mickey Brooks is the type of business person we should all seek and we should all emulate. He understands how to build success through good works, a caring approach and a focus on doing good and avoiding harm in all things business and personal.
Thank you Mickey Brooks. You’re some kind of Rainmaker!
To contact Mickey-
Mickey Brooks
Mortgage Planner
JLB Mortgage Group
11769 Whisper Bay Ct
Carmel, IN 46033
317.218.0283 (Office)
317.218.0291 (Fax)
888.249.4003 (Toll Free)
Judge Joven Speaks to Landlords
Posted on | March 12, 2010 | 2 Comments
At the March 9, 2010, meeting of the Central Indiana Real Estate Investors Association (“CIREIA”), the Honorable James Joven, Lawrence Township Small Claims Court Judge, spoke for more than an hour on a wide range of issues that impact landlords and the use of his court. It was one of the most informative meetings I have ever attended at CIREIA. I really regret that we did not video-record Judge Joven’s presentation, as it was excellent.
This is actually the second time that Judge Joven has been a speaker at a CIREIA meeting. Several years ago, the Judge spoke about securities laws and how they impact investors, particularly investors who use money from other people to purchase or otherwise invest in real estate. At that time, Judge Joven had just resigned as Indiana’s Securities Commissioner.
At the March 9 meeting, Judge Joven answered questions about the eviction process, court rules, emergency evictions, collections, proceeding supplemental, court procedures, evidentiary requirements and, the use of attorneys for landlords, property management companies, etc., etc., etc. There were several very interesting questions asked at the meeting, including one concerning the ability of a landlord to terminate the lease based on an infestation of “bed bugs” caused by a tenant. After the meeting, I received the following related question-
QUESTION-
Hello Matt,
I have been advised to “Ask Matt” about an issue I have. Unfortunately I was not able to make Tuesday’s Cireia meeting to ask, so this is the next best.
Had a tenant who somehow invested my house with bed bugs. The exterminator has (we believe) successfully removed them, there have been no signs of them remaining. The tenant vacated without notice, so now to re-lease.
My question is this, do I need to, or required to inform the tenant prospect of the bed bugs? Personally I feel morally I should, but I was advised to ask legally.
Thank you for your time,
Robert
MATT’S ANSWER- I do not believe that you are required, as a landlord, to inform a tenant about conditions to a property that no longer exist. So, if a prior tenant housed a dangerous pet, such as a pit bull dog, I do not believe the landlord is required to notify a prospective tenant that there once was but is no longer a dangerous dog in the house. Similarly, I don’t believe that a landlord has a duty to inform a tenant that the hot water heater in the house was once broken, as long as the water heater has been fixed and is working today.
Keep in mind that there are certain statutes that require notice from a landlord to attend up certain conditions related to a leased property. Probably the best example is the requirement that a landlord provide certain disclosures to a prospective tenant regarding lead.
An interesting question I asked Judge Joven was whether he believed a landlord must notify a tenant or prospective tenant that a sex offender or sexual predator, as those terms are defined by Indiana law, lives in the same apartment building or in the neighborhood. The Judge and I agree that a landlord would not ordinarily have a duty to inform a tenant of a sex offender or sexual predator living nearby, unless that sex offender or sexual predator had threatened tenants living in the building. I do believe that landlord might have a duty to warn tenants of known threats of this nature. Separate from the legal duty is the moral duty. In all fairness, a sex offender or sexual predator living next door might pose a risk that I would feel morally obligated to share with tenants. Whether I allowed the tenants to terminate their lease as a result of these conditions is another matter. But I think I would advise the tenants that a sex offender or sexual predator lives nearby.
What would you do if you were such a landlord?
___________________________________________________
DISCLAIMER: Judge Joven is a personal friend of mine. We were college classmates, and I have had a friendship with him for more than 20 years. He is a great judge, a good legal thinker, a community leader and a fantastic family man. I wholeheartedly support the Judge and hope sincerely that he is reelected.
Take your business to a new level in 2010
Posted on | March 11, 2010 | No Comments
Take your business to a new level in 2010 . Attend this amazing & free class sponsored by Xpedishon Coaching.
Xpedishon provides group coaching to solopreneurs and small business owners. Xpedishon was co-founded by Rainmakers CEO Tony Scelzo, Matthew Griffith, Ed Turi, and Jack Klemeyer. We are looking for 150 individuals who want to grow their business to over $500,000 per year in revenue. We have a proven system that has helped hundreds of individuals signficantly grow their business.
March 19th , 10:00 – 11:30 am
Details & Free Registration for the March Xcelleration Event.
- Are you willing to invest 90 minutes of your time to find out how to significantly grow your business in 2010?
- Are you done with this slow economy? Ready for better times?
- If you are frustrated with the challenges of running your business in this tough economy we would like to invite you to a free workshop to show you how you can double and even triple your business in 2010.
Matthew Grffiith, Tony Scelzo, Jack Klemeyer, and Ed Turi, the owners of Xpedishon Coaching, will lead an inspiring and dynamic presentation where you will learn-
- The three areas that you must focus on to grow your business.
- The top limiting beliefs that you must eliminate before you can ever succeed in business.
- How to structure your business to grow bigger than you ever thought possible.
People come to Xpedishon, because they are motivated and committed to growing their business despite the challenging economy. If you are committed to growing your business in 2010, then this free one-hour workshop is for you.
Ten Facts about Mortgage Debt Forgiveness
Posted on | March 9, 2010 | 1 Comment
My friend and mortgage consultant, Mickey Brooks, and I were talking this week about a client who needs to refinance her home. We got to talking about mortgage debt, tax sales and a variety of topics. Tax liability that can arise when a mortgage debt is forgiven came up briefly. Then, it came up in another conversation yesterday. And then a law partner sent me the following summary from the IRS. Clearly, this is an important topic, so I thought I’d share this excerpt from an IRS newsletter-
Ten Facts about Mortgage Debt Forgiveness
If your mortgage debt is partly or entirely forgiven during tax years 2007 through 2012, you may be able to claim special tax relief and exclude the debt forgiven from your income. Here are 10 facts the IRS wants you to know about Mortgage Debt Forgiveness.
- Normally, debt forgiveness results in taxable income. However, under the Mortgage Forgiveness Debt Relief Act of 2007, you may be able to exclude up to $2 million of debt forgiven on your principal residence.
- The limit is $1 million for a married person filing a separate return.
- You may exclude debt reduced through mortgage restructuring, as well as mortgage debt forgiven in a foreclosure.
- To qualify, the debt must have been used to buy, build or substantially improve your principal residence and be secured by that residence.
- Refinanced debt proceeds used for the purpose of substantially improving your principal residence also qualify for the exclusion.
- Proceeds of refinanced debt used for other purposes – for example, to pay off credit card debt – do not qualify for the exclusion.
- If you qualify, claim the special exclusion by filling out Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness, and attach it to your federal income tax return for the tax year in which the qualified debt was forgiven.
- Debt forgiven on second homes, rental property, business property, credit cards or car loans does not qualify for the tax relief provision. In some cases, however, other tax relief provisions – such as insolvency – may be applicable. IRS Form 982 provides more details about these provisions.
- If your debt is reduced or eliminated you normally will receive a year-end statement, Form 1099-C, Cancellation of Debt, from your lender. By law, this form must show the amount of debt forgiven and the fair market value of any property foreclosed.
- Examine the Form 1099-C carefully. Notify the lender immediately if any of the information shown is incorrect. You should pay particular attention to the amount of debt forgiven in Box 2 as well as the value listed for your home in Box 7.
For more information about the Mortgage Forgiveness Debt Relief Act of 2007, visit IRS.gov. A good resource is IRS Publication 4681, Canceled Debts, Foreclosures, Repossessions and Abandonments. Taxpayers may obtain a copy of this publication and Form 982 either by downloading them from IRS.gov or by calling 800-TAX-FORM (800-829-3676).
Setting Up An Indiana LLC
Posted on | March 7, 2010 | No Comments
Question: “We formed an LLC a few years ago, but haven’t done anything with it. We do own properties and a business, but nothing is titled in the name of the LLC. There are several family members involved and our tax returns are a mess. Any advice on what we should be doing?”
Matt’s Answer: “Yes, I advise you to gather all your deeds, financial records and company records, and sit down with your business or real estate attorney, your CPA and your insurance agent. I have reviewed your company records, and can see that you’ve done essentially no planning. We need to develop a plan for you. You need an asset protection plan that includes some training and education on how to operate your LLC. You need to get better insurance on your properties, your business and the LLC members. You need to fix your company record book, which includes the drafting and completion of an Operating Agreement. And, that Operating Agreement should contain buy-sell provisions to address what I call the “Big D’s-” death, disability, marital divorce, dissolution of the entity, and disinterest by one or more members. You also need to fix certain accounting and tax irregularities, which flow from your failure to devise a plan.
Your meeting with your attorney should last one hour to two hours, and should include training and instruction on how to operate this business. Yes, it is a business. “Real Estate Investing” is a misnomer. It should be called “Real Estate Management” or “Real Estate Business.” You should apply basic business principles to your real estate business. Although I cannot explain in great detail here everything you need to do to correct the shortcomings of your operation, I can assure you that it is a fairly routine matter for an experienced real estate and business attorney. This is not difficult to correct, but you need to consult with professionals and implement a plan. Do not believe everything you’ve read in a book, on the Internet or in a seminar manual. And do not expect your CPA or insurance agent to fix your legal matters, as each of these three professionals has his or her own expertise and field of licensed competency. Go see all three- an attorney, a CPA and an insurance agent- and get your house in order as soon as possible. Within thirty days, you should have your real estate business matters in order.”
Landlording 101- Indiana’s 45-Day Letter Rules
Posted on | March 4, 2010 | 2 Comments
Question: ”What is the 45-day letter?”
Matt’s Answer: ”Indiana law requires a landlord to give a tenant an itemized list of damages and the balance, if any, of the security deposit to a tenant within 45 days after the landlord regains possession.”
Question: ”Is is the 45-day letter required in every leasing situation?”
Matt’s Answer: ”This law applies to residential leases, in which the landlord has collected a security deposit. Be aware that “security deposit” is broadly defined. A security deposit includes any monies beyond the next month’s rent. So, if you collect the first month’s rent, the last month’s rent and a security deposit, all those monies, except the first month’s rent, are included in the security deposit.”
Question: ”Does the 45-day letter have to be in writing? Where do I send it?”
Matt’s Answer: ”You send the 45-day letter, in writing obviously, to the tenant’s forwarding address. Until the tenant provides the forwarding address, you need not send the letter. However, I think it is a bad idea to await the tenant’s forwarding address. Unless you have the address in writing, I recommend you send the 45-day letter to every address you have on the tenant, including the rental unit the tenant just vacated. More than once, I have been in court when a tenant has lied about giving the landlord the forwarding address verbally, or on the back of an envelope or scrap paper. Do not risk losing your case. Send the letter someplace, so you can prove to the court that you tried to comply with the law. And keep copies of the letter and even the envelopes you mail.”
Question: ”Is this all I need to know about the 45-dy letter?”
Matt’s Answer: ”No. I could write a small book on the topic. It has been the source of much litigation in Indiana over the years. This article is just an introduction to the topic.”
Indiana Attorney General Targets Real Estate Investors
Posted on | March 4, 2010 | 10 Comments
If you are engaging in any of these real estate transactions in Indiana, you should read this blog article-
- Buying on option & then selling (assigning) the option.
- Buying & reselling using a “double close”
- Buying “subject to” an existing mortgage
- Listing properties you do not own on your website, in fliers, in newspapers, etc.
- Using “bandit signs” or using the phrase “We buy homes” in your marketing materials.
In the past six months or so, I’ve had multiple conversations with Deputy Attorneys General, and other business and real estate attorneys about how the Indiana Attorney General is applying certain laws. Some of those conversations have been very long and very frustrating. In short, it is clear to me that the Attorney General has essentially declared war on certain small real estate investors who engage in “subject to” transactions with or with having a real estate license. In particular, there are two key statutes that the Attorney General is using to target small real estate investors-
- Indiana’s home mortgagor protection statute, effective July 1, 2007
- Real estate licensing statute.
The Attorney General views essentially every “subject to” transaction as unlawful. If you take title “subject to” an existing mortgage, you better have a bond, as the Indiana Code now requires. And, you better not be holding a Power of Attorney from the seller-owner. And even then, you better have a rock-solid contract with plenty of notices, warnings and disclaimers. And, if you satisfy these requirements, you might be in trouble if you do these deals often without a real estate license.
All of this is done in the name of protecting homeowners. The Attorney General sees this as consumer protection. I respectfully disagree. There are ethical, responsible real estate investors who save houses from foreclosure. The Attorney General’s approach diffrs from what I would do, in that his office seemingly attacks all investors doing deals “subject to.” I would favor an approach that distinguishes between good deals that help people and bad deals that hurt people.
Several months ago, the Attorney General conducted a statewide sweep. He gathered evidence on anyone with a website or bandit sign that read “We buy homes.” Seriously, that happened. The Attorney General started an investigation and issued document requests on 100′s, and maybe 1,000′s, of investors who used the phrase “we buy homes” in advertising messages. I think such tactics are unfair and uinwise.
I wish the Attorney General and the Indiana General Assembly understood the difference between legitimate “subject to” deals and the “get the deed at all costs” deals. Nor does the law they wrote distinguish between good deals and bad deals.
My advice? STAY AWAY FROM “SUBJECT TO” TRANSACTIONS IN INDIANA. Let the house go into foreclosure, buy it REO, and thank the state government for helping you drive down the price. Yes, that will hurt many homeowners, but let government officials explain the policy to homeowners who could have benefitted from a fair “subject to” deal.
Do you need a license to sell my own property?
One day, I had an hour-long argument with an investigator with the Attorney General’s Office who tried to convince me that you need a license to sell your own properties on your own website, if you sell more than a few at a time. I referred that investigator to the U.S. and Indiana constitutions. See “fundamental property rights.” I got a call back from a Deputy A.G. who apologized and retract the mistatements made by the investigator.
Here’s the deal. . . the Attorney General now takes the position that you cannot find a property, take an option on it, and then assign the option for a fee, without a real estate license. I assume that the Attorney General’s policy would extend to buying properties by contract, if the buyer merely marketed and assigned the land contract to another buyer.
The impact of these new policies, which are not law, are enormous on small investors-
- Bird Dogging is dead in Indiana.
- Even worse, most land speculation is dead in Indiana!
You might be wondering if the law changed recently? Did the Indiana General Assembly pass a law making options or landcontract assignments unlawful? No, there was no change in the law. The Attorney General simply decided that the licensing statute now applies to the assignment of options, and presumably to land contract assignments as well.
I should note that these new policies appear to extend only to residential homes. I doubt that commercial properties will be impacted, as there is no “consumer” to protect in a commercial deal.
Conclusion.
If the Attorney General can simply make a policy decision that has the effect of changing the law, I am not sure that you can safely rely on prior case law decisions and well-intend, well-established business practices. Now more than ever, you need to be very careful in such deal structures.
STOP TAKING LEGAL ADVICE FROM “LEGAL WITCH DOCTORS” AT A SEMINAR OR BOOTCAMP WHO JUST WANT TO SELL YOU A DVD OR FORMS ON CD! Those are things that are going to get you investigated or sued or prosecuted. There are no “get rich quick” real estate deals, and your legal documents and deal structures better be vetted by a knowledge real estate attorney. If not, you’re playing with fire. I hope none of you reading this get burned.
« go back — keep looking »Meet Matt
Expert Author
Categories
- Asset Protection (39)
- Business Attorney (24)
- Buy Sell Agreements (4)
- Cash Flow (11)
- Contracts (19)
- Insurance (10)
- knoMINGO.com (2)
- Law (55)
- Marketing (15)
- Property Management (2)
- Real Estate (45)
- Small Business (55)
- Taxes (3)
- Uncategorized (32)
- Videos (2)
