What Every Homeowner Should Know About Mortgage Fraud And Identity Theft

Identity theft professionals are becoming greedier and more proficient at their “game.” Identity theft is no longer limited to unpaid credit cards, small credit loans, but with the booming real estate market there is fast cash there for the conniving individual to make.

Mortgage fraud through identity theft is the second most common mortgage fraud scheme. The FTC reported in 2004 that $429 million dollars in damages for home mortgage fraud hoaxed and approximately $1.1 million dollars lost on commercial loans.

Mortgage fraud through identity theft occurs in several different ways. First a person may apply for a loan for a new home or for a home equity loan using your personal and financial information. The home equity loan is most often on the house that you are residing in, thus making this the easiest hoax to commit. Knowledge of an individual’s date of birth, social security number, as well as address makes it easy for victimization to occur.

Secondly, mortgage fraud may occur in a fake sale of your home. One thief will assume your identity and “sell” the property to another thief. With mortgage loan money in hand, both thieves get away and no real sale occurs. However, there have been instances where the homeowner’s identity was stolen and the home was sold to a legitimate buyer and the thief gets away with the money, the buyers have no new home and the original homeowner is left with the messy business of re-establishing his identity and his credit.

In most cases, the banks are the ones most damaged by these types of schemes. A legitimate homeowner did not take out the loan, so may not be held liable, but they don’t get off with out any damage at all. Many hours and much money may be required to correct the credit problems that are a result of identity theft, particularly when the theft results in large sums of money being stolen. Then there is the additional effort to protect their future credit and personal information.

Those most likely to be victims of mortgage fraud are the elderly, established homeowners, and those who have a great deal of equity in their homes. Equity information is readily available through an online title search and the use of tracking property values in the area.

Homeowners need to do the following to protect their homes and their credit.

– Monitor your credit report, receive regular updates, and stay informed;

– Immediately contact any lenders that provide information on your credit report when you discover pieces of information that are mistakes of fact or that you don’t know or recognize;

– Read your social security benefits statement when it comes in the mail to determine if anyone has already claimed your benefits.

– Be wary of communications regarding your home, real estate, personal or mortgage information including special “offers” to help you with your mortgage or interest rate.

– You may need to educate your parents or other elderly individuals with their credit protection plans.

– Install an anti virus and spyware software system on your computer to protect your personal and financial information.

Early detection and reporting of mortgage fraud schemes is important. With mortgage fraud, consumers may lose their property, their savings, and their credit rating. Secondly, lenders are affected by the loss of money, security, and assets in their company, not to mention the lack of trust resulting from these types of rackets.

If a victim of this type of crime, it should be reported to The Federal Bureau of Investigation (FBI) http://www.fbi.gov/ (202) 324-3000 – National FBI Financial Institution Fraud Unit. However, there are a possible 18 other government agencies, banking, consumer, and fraud reporting agencies as well as other consumer resources available to consumers depending on the type and method of mortgage fraud that occurred. For a complete list of resources, visit Mortgage News Daily http://www.mortgagenewsdaily.com/Mortgage_Fraud/National_Resources.asp

Consumers can try to stop identity theft before it happens by being forewarned and vigilant. If you are a victim of identity theft, in particular mortgage fraud you will have the information you need to correctly and quickly report the theft and take the steps necessary to begin to repair your credit.

Lisa Carey is a contributing author for Identity Theft Secrets: prevention and protection. You can get tips on Identity theft protection, software, and monitoring your credit as well as learn more about the secrets used by identity thieves at the Identity Theft Secrets blog

Building And Town Planning Permits

LAC Lawyers Pty Ltd is engaged in a substantial domestic building dispute in the Victorian Civil and Administrative Tribunal (“VCAT”) in Melbourne which involves a claim in excess of $1,800,000.00. Essentially, the case raises the inter-relationship between the issue of a building permit and the antecedent issue of a town planning permit in respect of Section 24 of the Building Act 1993 (Vic.).

That Section requires that a building surveyor must not issue a building permit unless a planning permit has been obtained and the building permit will be consistent with that planning permit.

Since the introduction of the Building Act 1993 (Vic.), the Victorian Building Commission has issued Ministerial Guidelines on behalf of the Minister for Planning.

In November 2000, the Building Commission issued a Minister’s Guideline numbered 00/001 entitled “Building Permit and Planning Permit Consistency”. Those guidelines required the building surveyor, in determining whether the building permit would be consistent with the planning permit, to take the following steps:

– Compare the plans lodged with the application for the building permit with those plans endorsed by the responsible authority as part of the planning permit and any documents referred to in the planning permit that have a direct bearing on the proposed building permit to ensure that they are consistent; and

– Confirm that all planning permit conditions relevant to the building permit that are required to be completed prior to commencement of the development, have been complied with.

The November 2000 Minister’s Guideline provided that the surveyor’s assessment of consistency between the building permit and the relevant planning permit should include (but not be limited to) consideration of:

– The height, area, form and configuration of the proposed building work or any part of the building work;

– The location of the proposed building on the land, including setbacks from boundaries;

– The location of windows, doors and privacy screens; and

– Any conditions of the planning permit that have specific construction requirements or that require specification construction details.

In October 2005, the Building Commission issued a further Minister’s Guideline entitled “Professional Standards – Building Surveyors” which stated that building surveyors performing their functions had to do so in a competent manner and to a professional standard.

This legislation and guidelines places a building surveyor under an obligation to identify discrepancies between the architectural drawings and town planning drawings on the one hand and working drawings and building contract on the other hand. Any such discrepancies should be referred back to the client/builder with a request that an explanation be provided. A building surveyor should not attempt to reconcile or resolve the discrepancies on his or her own.

Likewise, a builder has independent obligations to check documents approved as part of a building permit for any discrepancies before setting out building works and commencing construction.

Section 16 (1) of the Building Act 1993 (Vic.) requires that a person must not carry out building work unless a building permit in respect of the work has been issued and is in force and the work is carried out in accordance with the legislation and the building permit.

Accordingly, builders who do not identify discrepancies between architectural and town planning drawings on the one hand and working drawings and the building contract on the other hand before proceeding to excavate footings, poor slabs and erect frames may well be responsible for considerable damages for re-building, delay and consequential economic loss to developers if such matters as setbacks have been incorrectly calculated even where the setbacks are in accordance with the working drawings incorporated into the building permit but are contrary to the town planning permit conditions or endorsed town planning drawings.

Both building surveyors and registered builders have important responsibilities to ensure that commercial and domestic buildings are constructed in compliance with Victorian legislation and Victorian planning and building permits.

Of course, the fact that discrepancies exist between the endorsed town planning drawings and the building permit working drawings may also give rise to liabilities on the part of the building designers/architects responsible for either. If the town planning drawings drafter knows that a developer/builder has appointed someone else to complete working drawings, the town planning drafter may be under a duty of care to warn the developer/builder to ensure that the working drawings are consistent with the town planning permit conditions and the endorsed town planning plans. Likewise, where the working drawings drafter is aware that the developer/builder has appointed someone else to complete town planning drawings, the working drawings drafter may be under a duty of care to warn the developer/builder to check the working drawings when the town planning permit is issued to ensure that the working drawings are consistent with the later endorsed town planning drawings.

Modern building practice is for developers to shop around to obtain the most competitive price for town planning and drafting services. This sometimes leads to different design professionals being appointed for each function. Where this is so, the drafters have an obligation to ensure that plans continue to be checked even if this work is to be performed by another. Likewise, a developer may find that he or she is regarded by the courts as accepting a de facto duty to work as a project manager and ensure liaison between the town planning drafter and the working drawing drafter where these functions are split on the grounds of cost efficiency. This duty may be imposed even when the developer is not a professional builder or investor.

Michael Pickering is a solicitor employed at LAC Property Lawyers Melbourne. He has nearly 20 years experience as a lawyer.

Airspace Over Your Property – How Much Of It Do You Own?

CYA Disclaimer: The following is intended for reference purposes only and not as legal advice. The short answer is, “as much of it as you can use”. No, you cannot float a “No Trespassing” blimp and shoot down passing airliners for trespassing. But believe it or not, you can build a tall building on your property and the airlines can’t make you take it down even if it interferes with air traffic – unless you can find a law (such as building codes) that expressly prohibits you from doing so. By federal law, upper airspace is considered “navigable”, meaning the public has the right to use it. But what exactly is “upper airspace”? In the foregoing example, if you built a tall building on your land and the airline were overflying your property at altitudes lower than the height of your building (and in the same vicinity), it would be possible for you to sue them for trespassing.

It would also be possible for you to sue for nuisance even if the planes didn’t even overfly your airspace, if the planes were making enough noise to interfere with your “quiet enjoyment” of your property. Keep in mind, though, that if you live near an airport, the airport has probably already purchased the right to make as much noise as they want. If you don’t know about any such purchase, it’s probably because these rights were purchased from a previous owner of your property.

I’ve got some good news, though, if a new airport is being built near property you own – you might be able to make them pay for the right to pollute your airspace with noise, regardless of whether their planes will be overflying your property or not. If the airport is government-owned, you could claim that the noise constituted a “taking” of your property and although you couldn’t stop them from doing it, you could demand “just compensation” (note that the legalese is in quotation marks). If the airport is privately owned, you could file a claim under nuisance law and force them to choose between either continuous liability under nuisance law or settling with you in lump sum for the reduction in the value of your property.

Real Estate Law in Plain English explains real estate law without the legalese.

Community Property Law

Community property law is normally applicable only to two people who are legally married, although it is sometimes applied to couples who have lived together for a long time. Some states have not yet enacted community property laws, and the law varies considerably among the states that have enacted them. Nevertheless, the community property laws of various states share certain features in common.

Contrary to popular opinion, you can’t marry a millionaire in a Las Vegas Chapel ‘o Love drive-thru window, pull around and get a drive-thru divorce, and pull out of the parking lot a millionaire yourself. Community property applies to all the property gained during the marriage – so the longer the marriage lasts, the better chance the richer spouse has of getting fleeced. For most couples, wages and salaries are the biggest component of community property. Pensions are also included, as are assets (such as houses and cars) bought with these funds. So if one spouse is worth ten million and the other is worth fifty cents before walking into the church for the wedding, their respective wealth is probably going to be about the same when they walk out a few hours later.

In addition to “community property”, each spouse will normally have some “separate property”. Separate property includes each spouse’s property obtained before the marriage, along with income derived from this property, even if the income is earned after the marriage (in most cases). Gifts received by one spouse only are also considered separate property. In a few states, though, family residences are considered community property even if it was a gift to one spouse and the title is in that spouse’s name only. In addition, separate property can be converted into community property by having one spouse donate his or her separate property to the couple’s community property..

The foregoing is a very simplified explanation of community property law. Keep in mind that significant differences exist among states, and that there are a lot of rules involved. This article was written to give you a rough idea of what does and does not belong to you.

DISCLAIMER: The following in intended for reference only and not as legal advice.
Real Estate Law in Plain English explains real estate law without the legalese.


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Real Estate Options to Purchase

What is an Option? “An option is a contract by which the owner of property invests another with the exclusive right to purchase said property at a stipulated sum within a limited or reasonable time in the future.” Nattress & Associates v. Cidco (1986) 184 Cal.App.3d 55, 66. Donald Trump used an option to purchase the Hotel Commodore at Grand Central Terminal, his ground breaking first deal at 27 years old. More commonly, options are used in leases in which the landlord gives the tenant an option to buy the property. For example, the AIR Option to Purchase form provides that the lessee must provide written notice within a certain time period (i.e., April 1, 2004 to April 30, 2006), with the option expiring at the end of the option period. The form also sets forth the price, the escrow agent, a time period in which to close the sale and other instructions. After exercising an option, the parties should then enter into a Purchase & Sale Agreement, which addresses in more detail all of the minutiae of the sale transaction.

An Option is Irrevocable. An option supported by consideration (even $1) is an irrevocable offer, open for a prescribed period. The acceptance must be in accordance with the terms of the option agreement and must be free of conditions which the optionor is not bound to perform. Riverside Fence Co. v. Novak (1969) 273 Cal.App.2d 656, 660. The exercise of an option is merely the communicated election of the optionee to accept the option. Id. at 661. It is important to recognize that, in terms of the formation of a contract, an option is a contract. Therefore, the “offer” (option) is truly irrevocable and merely awaits acceptance.

A Qualified or Conditional Acceptance. What is the effect of an acceptance which adds additional terms or is made conditional? “Any tender of performance is ineffective if it imposes conditions upon its acceptance which the offeror is not entitled to demand.” Riverside Fence Co., supra., at 662. However, the fact that a purported acceptance adds a qualification to the agreed-upon option does not in and of itself terminate the option. As long as the option period has not yet expired, a party may still exercise the option without qualification or condition (even though a prior [ineffective] acceptance may have added such qualifications). Again, the option is truly irrevocable.

The courts have explained that “if the person offering to perform is acting in good faith, and makes the mistake of demanding something to which he is not entitled, he ought to be given the same opportunity to recede from such demand that he is allowed for tendering the correct amount where he has tendered too little, or the right thing where he has tendered the wrong thing…” Nattress & Associates, supra., at 67.

Waiver of Conditions. In the event that a party imposes additional conditions on the exercise of an option, the offeree must specifically point out the alleged defects in the tender or he waives the right to object to the conditions. Civil Code §1501; Code Civ. Proc. §2076. The rationale of this requirement is that the offeror should be allowed to remedy any defects in his tender. Therefore, the offeree should not be allowed to remain quiet at the time of the tender and later surprise the offeror with hidden objections. Riverside Fence Co., supra., at 662.

In addition, an optionor may not do any act or omit to perform any duty calculated to cause the optionee to delay exercising the option within the specified period. A court will look at the good faith of the optionor. If he attempts to prevent the exercise of the option, his behavior may excuse a failure to perform and other conditions precedent to acceptance by the optionee. For example, in the Riverside Fence case, the optionor failed to sign the escrow instructions but would not explain why. The optionee offered to make corrections but the optionor refused to identify any defects in the exercise of the option. The court found that, although plaintiff had not performed, she had attempted in good faith to tender performance and that defendant’s evasive conduct was calculated to prevent timely performance. The court therefore precluded the optionor from asserting that there had not been a timely or proper exercise of the option.

Laine T. Wagenseller is the founder of Wagenseller Law Firm, a full service real estate litigation firm in downtown Los Angeles. The firm represents real estate developers, owners, and investors. For more information visit http://www.wagensellerlaw.com or contact Mr. Wagenseller at (213) 996-8338.

Basic Foreclosure Process/Timing in Indiana

Need a handle on how long it will take to liquidate your borrower’s collateral in Indiana? Since the foreclosure process officially starts with the filing of a complaint, my timelines start there. A complaint cannot be filed until there has been a default under the terms of the real estate mortgage or personal property security agreement. Needless to say, many weeks if not months might pass between the initial loan default and the decision to file suit. The timing of the foreclosure process largely depends upon whether and to what extent the borrower contests the proceeding:

Uncontested Foreclosure: 4½ – 6 months minimum. If a business debtor does not contest foreclosure (but will not agree to a deed in lieu), the process can move relatively quickly. Here are the major steps and applicable ranges of time:

1. Filing of the Complaint

2. Service of process on the debtor: occurs in 5-10 days unless service by publication

3. Application for default judgment: can be sought 21-24 days after service of process

4. Entry of default judgment and decree of foreclosure: should occur within approximately 30 days after the Application is filed

5. Praecipe for Sheriff’s sale, including notice of same: by statute, cannot be filed until 3 months after the Complaint

6. Sheriff’s sale: happens about 45-90 days from Praecipe, depending on the county

Contested Foreclosure: 6-9 months minimum. Given the vagaries of litigation, it’s virtually impossible to conclusively estimate how long a contested foreclosure case may last. Much depends upon how clear the default and the damages are. Perhaps the most significant factor relates to the time associated with workout negotiations. In that regard, each case is different. Here are the main steps of a fairly quick contested foreclosure:

1. Filing of the Complaint

2. Service of process on the debtor: occurs in 5-10 days unless service by publication

3. Appearance of debtor’s attorney and motion for one or more 30-day extensions of time to respond to the Complaint: filed 20-23 days after service of process

4. Answer to Complaint: filed 30 days after filing of Appearance and expiration of last motion for extension

5. Motion for summary judgment: can be filed immediately after the filing of the Answer 6. Objection to motion for summary judgment: due 30 days after the filing of the motion for summary judgment

7. Summary judgment hearing: usually held 75-120 days after the motion is filed

8. Entry of judgment and decree of foreclosure: occurs on day of hearing, or soon thereafter, unless the motion is vigorously contested with viable defenses

9. Praecipe for Sheriff’s sale: can be submitted immediately after the entry of judgment assuming more than 3 months have passed since the complaint was filed

10. Sheriff’s sale: takes place 45-90 days from Praecipe, depending on the county

Judicial sales. Indiana law requires a judicial sale in order to foreclose a mortgage. I.C. 32-29-7-4 (http://www.ai.org/legislative/ic/code/title32/ar29/ch7.html#IC32-29-7-4) is a nice option for creditors looking to expedite a sale. The statute permits, under certain limited circumstances, the sheriff’s sale to be conducted by a private auctioneer on the civil sheriff’s behalf. This may be advisable in counties without regularly-scheduled sheriff’s sales. (I should note that, as to personal property security interests, UCC/Article 9.1 and/or the terms of a security agreement may allow the creditor to repossess the collateral without a sheriff’s sale.)

Be prepared for delays. Although the basic procedure is the same throughout Indiana, the timing can be impacted dramatically by the dockets of the individual courts and/or the schedules of the individual civil Sheriffs’ offices. The periods described are the minimum time periods. The actual time usually is longer. This is especially true if there are multiple creditors named in the lawsuit. Further, in contested cases involving debtors represented by counsel, opposing attorneys can prolong the process in a variety of ways, including multiple motions for extensions of time, requests for discovery and vigorous challenges to a motion for summary judgment. In the event a trial must occur, a resolution of the case can be delayed several months if not years. In addition, a bankruptcy can be filed up until the time when the Sheriff’s sale begins, and that can delay the foreclosure process indefinitely.

Depending on the goals of the lender, the lawyer representing the lender can push the case aggressively toward a sale. Or, counsel can be more passive to give the parties time to assess whether a refinancing arrangement may be warranted. The parties can settle, or the debtor can redeem – real estate / I.C. § 2-29-7-7 (http://www.ai.org/legislative/ic/code/title32/ar29/ch7.html#IC32-29-7-7); personal property / I.C. § 26-1-9.1-623 (http://www.ai.org/legislative/ic/code/title26/ar1/ch9.1.html#IC26-1-9.1-623) – right up to the sale or disposition of the collateral. Debtors’ attorneys know this, so don’t be surprised if a borrower waits until the eve of sale either to file for bankruptcy protection, redeem or yield to the lender’s loan modification terms.

John D. Waller is a partner at the Indianapolis law firm of Wooden & McLaughlin LLP (www.woodmclaw.com). He publishes the blog Indiana Commercial Foreclosure Law at http://commercialforeclosureblog.typepad.com. John’s phone number is 317-639-6151, and his e-mail address is jwaller@woodmclaw.com.


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Filing Date is What Matters When Determining Parties to Name in Mortgage Foreclosure

When a lender makes the decision to foreclose on its borrower’s real estate collateral in Indiana, the lender must determine who, besides the borrower, claims an interest in the property. That’s why a title policy (foreclosure) commitment is ordered before the filing of the case. Clear title cannot be obtained upon a sheriff’s sale unless all lien holders are named as defendants in the suit (so that their interests can be foreclosed). Recently, the Indiana Court of Appeals reminded us of why and when pre-suit title work must be updated. The rule. In the December 8, 2006 opinion House v. First American Title Company, 2006 Ind. App. LEXIS 2472, the Court of Appeals addressed a dispute between the purchaser of residential real estate (after a sheriff’s sale) and his title insurance company. Although the issues in the opinion have no real bearing on commercial foreclosure law, a rule cited by the Court in its decision does: a foreclosure action’s filing date is the “only relevant date used to determine the proper parties to a mortgage foreclosure.” Third-parties who secure an interest in the mortgaged property after the filing of the foreclosure complaint need not be named in the suit. Note these comments from House:

Because the judgment of the Dearborn County Health Department did not attach until after the foreclosure action was commenced by the Bank of New York, any lien which arose as a result of the default judgment obtained by the health department was foreclosed by the foreclosure sale and therefore does not affect fee simple title to the real estate.

So, lenders need not continuously search title during the course of litigation and worry about adding new parties to their foreclosure complaint. “The only relevant date” is the foreclosure action’s commencement date – the day the lender filed the complaint.

Date down. Invariably, there will be a gap between the completion of the preliminary title search and the initiation of the suit. Conceivably, liens, etc. could arise during that time. To cover the gap, lenders must “date down” (update) their title policy commitment to the day of the filing of the complaint. House confirms that this is the only title update required, and I recommend that it be done shortly after the filing of the complaint. If any interests arise during that period, the new lienholders must be added to the case. Should the updated commitment uncover no new interests, the lender can be comfortable proceeding with the original cast of characters.

John D. Waller is a partner at the Indianapolis law firm of Wooden & McLaughlin LLP. He publishes the blog Indiana Commercial Foreclosure Law at http://commercialforeclosureblog.typepad.com. John’s phone number is 317-639-6151, and his e-mail address is jwaller@woodmclaw.com.

Texas Real Property Law for Commercial Landlords

I have found that landlords generally face the same set of issues and have the same set of questions pertaining to their rights, duties and obligations as landlords under Texas law. The answers to these questions depend on whether residential tenants or commercial tenants are involved. Although commercial and residential property ownership and operation have some similarities, the differences are numerous and diverse enough to justify separate treatment for each area. This article is intended to discuss issues related to commercial property with commercial tenants only. This article is my attempt to create a quick and very general reference guide on the rights, duties and obligations of commercial landlords and operators under the Texas Property Code. It is by no means complete, but hopefully is informative enough to assist the reader in asking informed questions of legal counsel and thus be more efficient and economical while consulting legal counsel.

You should not take this article as legal advice, and I strongly urge you to seek competent legal advice for your specific situation. The Texas legislature updates and passes new laws relating to landlord/tenant issues on a regular basis. In addition, Texas courts regularly interpret these laws. Thus, the laws discussed in this article are in effect as of December 2005. I have not assumed any duty or obligation to update this article beyond this date.

I. Duty to Mitigate

If a tenant abandons the leased premises in breach of the lease, the landlord has the duty to mitigate (lessen) the damages that the landlord would experience as a result of the abandonment. Thus, the landlord should not let the premises lie vacant in hopes of being able to recover lost rents from the tenant. This duty to mitigate damages may not be waived by the tenant, so any provision in the lease that tries to waive this duty or exempt the landlord from liability is void.

II. Security Deposit

A security deposit is any advance of money, other than a rental application deposit or an advance payment of rent, that is intended primarily to secure performance under a lease.

III. Retention of Security Deposit

Before returning the security deposit, the landlord may deduct from the deposit damages or charges for which the tenant is obligated under the lease or resulting from a breach of the lease. However, normal wear and tear (does not include deterioration that results from negligence, carelessness, accident or abuse) may not be withheld from the security deposit.

If the landlord retains any portion of the security deposit, the landlord must refund the balance of the security deposit and give the tenant a written description and itemized list of all deductions. However, this description and itemized list is not required if the tenant owes rent and no controversy exists concerning the amount of rent owed. The refund and written description and itemized list of all deductions is not required until the tenant gives the landlord a written statement of the tenant’s forwarding address for the purpose of refunding the security deposit. However, failure to provide a forwarding address does not cause the tenant to forfeit its right to receive a refund or a description of deductions.

IV. Refund of Security Deposit

A landlord must refund the security deposit not later than the 60th day after the date the tenant surrenders the premises and provides notice of the tenant’s forwarding address.

V. Change of Landlord/Owner and the Security Deposit

The new owner or landlord of the leased premises is liable for the return of the security deposit starting from the date title to the leased premises is acquired, except where the new owner acquired the premises by foreclosure through a real estate mortgage. However, the former landlord or owner remains liable for the security deposit received while the person was the owner or landlord until the new owner delivers to the tenant a signed statement acknowledging that the new owner has received and is responsible for the tenant’s security deposit and specifying the exact dollar amount of the deposit.

VI. Liability of Landlord for Security Deposit

A landlord who in bad faith retains a security deposit is liable for an amount equal to the sum of $100, three times the portion of the security deposit wrongfully withheld, and the tenant’s reasonable attorneys fees incurred in a suit to recover the deposit. It is presumed that a landlord who fails to return a security deposit or to provide a written description and itemized list of deductions on or before the 60th day after the date the tenant surrenders possession is acting in bad faith.

VII. Preventing Access to Leased Premises

A landlord may not intentionally prevent a tenant from entering the leased premises except with permission of the court unless such prevention results from (i) bona fide repairs, construction or an emergency, (ii) removing the contents of the leased premises abandoned by a tenant or (iii) changing the door locks of a tenant who is delinquent in paying at least a part of the rent. The lease may alter this provision.

VIII. Changing Lock Due to Delinquent Payments

If a landlord changes the door lock due to delinquent rent payments, the landlord must place a written notice on the tenant’s front door stating the name and address or telephone number of the individual or company from which the new key may be obtained. The new key is only required to be provided during the tenant’s regular business hours and only if the tenant pays the delinquent rent. The lease may alter this provision.

IX. Landlord’s Removal of Property After Abandonment by the Tenant

A landlord may remove and store any property of a tenant that remains after the premises has been abandoned. The landlord may also dispose of the stored property if the tenant does not claim the property within 60 days after the date the property is stored. The landlord must deliver by certified mail to the tenant at the tenant’s last known address a notice stating that the landlord may dispose of the tenant’s property if the tenant does not claim the property within 60 days after the date the property is stored. A lease may alter this provision.

X. Abandonment by the Tenant

A tenant is presumed to have abandoned the premises if goods, equipment or other property, in a substantial enough amount to indicate a probable intent to abandon the premises, is being or has been removed from the premises and the removal is not within the normal course of the tenant’s business. The lease may alter this provision.

XI. Interruption of Utilities

If the tenant pays for utility services directly to the utilities companies, the landlord may not interrupt or cause the interruption of such services unless the interruption results from bona fide repairs, construction or an emergency. A lease may alter this provision.

XII. Removal of Doors, Windows, Locks, Hinges, Etc.

A landlord may not remove a door, window, attic hatchway, lock, hinge, hinge pin, doorknob or other mechanism connected to a door, window or attic hatchway cover from the leased premises. Additionally, a landlord may not remove furniture, fixtures or appliances furnished by the landlord from the leased premises. However, the landlord may remove these items for a bona fide repair or replacement, which must be promptly performed. A lease may alter this provision.

XIII. Landlord May Terminate Lease Due to Public Indecency Conviction of Tenant

A landlord may terminate a lease signed or renewed after June 15, 1981 if the tenant or occupant uses the property for an activity for which the tenant, occupant or any of their agent or employee is convicted of public indecency (prostitution, promotion of prostitution, display or distribution of obscene materials, sexual acts with persons under the age of 18, etc.) and such person has exhausted or abandoned all avenues of direct appeal from the conviction. Notice of termination must be by written notice within six months after the right to terminate arises. The landlord obtains the right to possess the property on the 10th day after the date of notice is given.

XIV. Notice Requirement Prior to Eviction

The landlord must give a tenant who defaults or holds over beyond the end of the term at least three day’s written notice to vacate the premises before the landlord files a forcible detainer suit, unless the parties contracted for a shorter or longer period of time in a written lease or agreement.

The notice to vacate must be given in person or by mail at the premises in question. If notice is delivered in person, it may be by personal delivery to the tenant or any person residing at the premises who is 16 years of age or older or personal delivery to the premises and affixing the notice to the inside of the main entry door. Notice by mail may be by regular mail, by registered mail or by certified mail, return receipt requested, to the premises in question. The notice period starts from the day on which the notice is delivered.

Copyright 2005, Tri Nguyen

Tri Nguyen practices primarily business, corporate and real estate law in Houston, Texas. He may be contacted by telephone at 713.513.4808 or e-mail at tri@trilawoffice.com.

Not certified by the Texas board of legal specialization.

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Tenant Law in California

Under California law landlords have to adhere to housing standards and must refrain from using self help. There are housing standards that if violated will deem the property untenantable, meaning it cannot be rented out.

The property is deemed untentantable, if it substantially lacks the following:

(1) Effective waterproofing and wether protection of the roof, walls, windows, and doors;

(2) gas facilities maintained in good working order;

(3) a water supply capable of producing hot and cold running water, and connected to a sewage disposal system;

(4) heating facilities maintained in good working order;

(5) Electrical lighting, maintained in good working order;

(6) the building, the grounds, appurtenances, and all areas under control of the landlord starting from the time of the commencement of the lease or rental agreement have to be kept clean, sanitary, free from all accumulations of debris, filth, rubbish, garbage, rodents, and vermin;

(7) an adequate number of appropriate receptacles for garbage and rubbish, in clean condition and good repair at the time of the commence of the lease or rental agreement, and the landlord is responsible for the clean condition and good repair of the receptacles under his or her control;

(8) floors, stairways maintained in good repair.

The landlord also has to be sure he complies with local ordinances and any remodeling has to comply with existing building codes.

A landlord of a dwelling cannot legally demand rent, collect rent, issue a notice of a rent increase, or issue a three day notice to pay rent or quit, if the property is untentable and:

(1) A public officer or employee who is responsible for the enforcement of any housing law, after inspecting the premises, has notified the landlord or the landlord’s agent in writing of his or her obligations to abate the nuisance or repair the substandard conditions;

(2) The conditions have existed and have not been removed 35 days after notice was received from a public officer and the delay is not for good cause;

(3) and the conditions were not caused by an act of the tenant or the tenants failure to act.

A landlord that demands rent, collects rent, or issues a notice of rent increase, or issues a three day notice to pay or quit and the four conditions are present then the landlord liable to the tenant for the actual damages, plus special damages of no less than $100 and not more than $5,000.00. The prevailing party is also entitle to reasonable attorney fees and costs.

This does not mean that the tenant can cause these conditions and it does not mean that
the landlord is liable if the tenant chooses to live in substandard conditions. The landlord has no duty to repair a dilapidation if the tenant is in substantial violation of the following affirmative obligations:

(1) The tenant is obligated to keep that part of the premises which he occupies and uses clean and sanitary as the condition the premises permit;

(2) The tenant is required to properly dispose for his dwelling unit all rubbish, garbage and other waste , in a clean and sanitary manner;

(3) The tenant is obligated to refrain from giving permission to any person on the premises to willfully destroy, deface, damage, impair or remove any part fo the structure and the tenant also must refrain from doing such things;

(4) The tenant is obligated to occupy the premises as his abode, utilizing portions for living, sleeping, cooking or dining purposes only as the dwelling was designed and intended to be used.

These are the most basic requirements, but the list of obligations and responsibilities is much broader and imposes even more responsibilities on the landlord. What is shocking, is that a landlord is allowed to legally harass a tenant, even when the landlord has no viable claim and is in violation of the preceding. A landlord can initiate eviction proceedings and even evict a tenant, even if the landlord is in violation of the aforementioned housing violations. If the tenant is able to obtain counsel to represent the tenant the landlord can litigate the lawsuit and then on the day of trial simply dismiss the lawsuit.

If the landlord alleges a contract violation as the basis of the lawsuit, the landlord can dismiss the lawsuit at the very last minute and not incur any attorney fees or costs, because if there is an attorney fee provisions in the lease agreement there is no winner when the landlord voluntarily dismisses the case. It is a loophole that essentially encourages frivolous lawsuits. Under California law the landlord could bring a frivolous lawsuit several times and dismiss them just before trial after the tenant has exhausted thousands defending the lawsuit. This is how a landlord can harass a tenant legally.

It is not right, it is not fair, and certainly not just, but it is the result that was created by the State Legislature.

Arnold Hernandez, represents clients primarily in San Marcos, Escondido, Vista, Oceanside, and throughout the Counties of San Diego, Imperial, Riverside, Los Angeles, and Orange in overtime clams, car accidents, dog bites, and truck accidents http://www.arnoldhernandez.com

What to Know Before Signing a Home Improvement Contract

It is important to be a very careful consumer when it comes to home improvement contractors. For instance, I had a case where my client, an elderly and blind woman, signed a contract and paid $30,000.00 to a home improvement company that disappeared with all of her money! Unfortunately, the company was a scam operation, my client lost her life’s savings and it will take some time in court before my client may ever see her money again however, her mistake will be a lesson to all of you because this article explains how to protect yourself from home improvement fraud.

Before signing any contract with a home improvement company, first ask that company for its license number and check it out with your State or County Consumer Affairs’ Business License Division. Find the License Division on the web or call information and get their number. You want to find out (1) the name and address of the company associated with the license number given to you, (2) if the company is currently licensed and the license expiration date and (3) whether any complaints have been made against that company. The answers to those questions will help you determine if you want to proceed with signing a contract. Make sure both the contractor and the company he works for are licensed to work in your State.

If your going to sign the contract then make sure certain things are included pursuant to your understanding and as required by your State’s Home Improvement Business Law. The contracting company’s name, address and phone number should be printed on the contract. Also, it is important that the contracting company’s home improvement license number is printed on the contract and that it is not different from the number you called and inquired about with Consumer Affairs. Lastly, make sure that all of the work to be performed is listed in the contract and that the approximate start and end dates of work are included. You should put a penalty clause in the contract regarding the contractor’s failure to timely complete the work because contractors are notorious for starting jobs and then leaving for a few days or weeks to do other jobs while you sit and wait in your dismantled kitchen for him to return. Once the contract terms are satisfactory then the contract should be signed by both you and the company’s representative.

An example of a consumer protection law is New York’s General Business Law §771 (“GBL”) requiring all home improvement contracts shall be in writing and contain certain terms of payment, fees for services and materials and start and completion dates, among other terms. GBL §771 is a consumer protection statute to prevent the misunderstandings between contractor had consumer and to protect the consumer from overreaching of the contractor, such as charging for work that was not agreed upon. GBL §771 limits the contractor who disregards its written contract requirements to satisfactorily proving to a court each and every item of work he did and the reasonable value of each item by detailed invoices, timesheets and proof of hourly rates, among other proofs. So, if the contractor who failed to put your home improvement work in writing attempts to collect $20,000.00 from you, he has to prove the value of his services in detail before scaring you into paying an amount you had no idea about. New Jersey’s Consumer Fraud Act and the Home Improvement Act protect the consumer even more by denying the contractor from recovering any monies if he violates any of the consumer laws AND he will pay three times the amount of damages (called treble damages) to the consumer for his failing to obtain proper permits or licenses or any other violation of those laws.

Lastly, protect yourself by not paying 100% upfront. Most contracting companies ask for a deposit upon your signing the contract. I suggest that you put down as little as possible and arrange a payment schedule with the company where you will pay a certain amount as certain work is completed. Of course, always get a receipt, signed by the company and stating the date and amount of any monies paid to the company if you pay anything in cash.

This article is certainly not all inclusive and is intended only as a brief explanation of the legal issue presented. Not all cases are alike and it is strongly recommended that you consult an attorney if you have any questions with respect to any legal matters.

Any questions and/or comments with respect to this topic or any other topic, contact:


Law Offices of Susan Chana Lask
853 Broadway, Suite 1516
New York, NY 10003
(212) 358-5762

Susan Chana Lask, Esq. c 2004

Susan Chana Lask is named in the media as New York’s “high powered attorney”. She practices sucessfully all civil, criminal & appeals cases in State & Federal courts nationwide. http://www.appellate-brief.com