The Essentials of Real Estate Law

Views:
 
     
 

Presentation Description

No description available.

Comments

Presentation Transcript

California Real Estate Law Principles : 

American Advantage Law Group3848 Campus Dr. Suite #206Newport Beach, CA 92660 P - 949-863-1888 F - 949-863-1888 California Real Estate Law Principles

Disclaimer : 

Disclaimer The materials available at this web site are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between American Advantage Law Group and the user or browser. The opinions expressed at or through this site are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney.

Who regulates conduct of real estate agents? : 

Who regulates conduct of real estate agents? In California: The Real Estate Law Court Decisions Department of Real Estate Regulations of the Real Estate Commissioner

The Real Estate Law : 

The Real Estate Law Division 4, Business and Professions Code Part 1 covers licensing Part 2 covers transactions and includes Subdivided Lands Law Regulations of the Real Estate Commissioner clarify and interpret the Real Estate Law

Slide 5: 

Real Estate Commissioner appointed by the Governor Real Estate Advisory Commission appointed by the Commissioner Six members--licensed California real estate brokers Four members--nonlicensed members of the public Department of Real Estate

Real estate brokerage : 

Real estate brokerage Business in which real estate license-related activities are performed under supervision of a licensed real estate broker Corporate brokerage must have designated broker-officer

Broker/Salesperson relationship : 

Broker/Salesperson relationship Under the Real Estate Law, the salesperson is always considered the employee of the broker Salesperson can do business only as an employee of a broker

Who doesn’t need a real estate license? : 

Who doesn’t need a real estate license? Person dealing with their own property Corporation acting through regular officers Licensed securities broker or dealer in sale, lease or exchange of business opportunity Holder of power of attorney from property owner Attorney at law acting as an attorney Receiver, bankruptcy trustee or person under court order Trustee selling under deed of trust Employees of lending institutions, pension trusts, credit unions or insurance companies, in connection with loans secured by real property or a business Escrow agents collecting funds in connection with loans secured by liens on real property, when funds are deposited in escrow agent’s trust account

Real estate broker : 

Real estate broker At least 18 years old Honest and truthful Completed eight college-level courses Fulfilled experience requirement Passed broker’s licensing exam Sent in required fee Completed 45 hours CE every four years Obeys applicable laws and regulations

Real estate salesperson : 

Real estate salesperson At least 18 years old Honest and truthful Passed course in Real Estate Principles Passed salesperson’s licensing exam Employed by real estate broker Paid required license fee Must complete two more courses within 18 months Must complete 45 hours of CE every four years Obeys applicable laws and regulations

Major real estate trade associations : 

Major real estate trade associations California Association of Realtors® California Association of Real Estate Brokers California Mortgage Association California Association of Mortgage Brokers California Association of Business Brokers California Mortgage Bankers Association California Building Industry Association California Association of Community Managers

Historical perspective : 

Historical perspective Native Americans Balboa and conquistadores—1513 Missions Presidios Pueblos Mexican independence—1822 California possession of Mexico Treaty of Guadalupe Hidalgo—1848 California possession of U.S. California becomes a state—1850

California today : 

California today Land ownership Federal 45% State 2% Local 2% Private 51% Population more than 33 million, with 97% in metropolitan areas

Real property : 

Real property Bundle of Rights: Right of Possession Right to control property’s use Right to exclude others Right to dispose of the property Real estate can be explored, willed, mortgaged, encumbered, leased, traded, exchanged, given away

Definition of real estate : 

Definition of real estate In California, “real estate” is the same as “real property” and includes: Land Fixtures to land Anything incidental or appurtenant to land Anything immovable by law

Fixtures : 

Fixtures A fixture is anything attached (“affixed”) to land Tests for a fixture: Method of attachment Adaptability Relationship of parties Intent in placing on land Agreement of parties

Land description : 

Land description To avoid confusion in describing a parcel of land, use: Legal description APN—assessor’s parcel number and Street address

Methods of legal description of land : 

Methods of legal description of land Lot and block system also called subdivision system Rectangular survey system also called section and township system U.S. government survey system Metes and bounds

Survey system in California : 

Survey system in California Principal base lines and meridians: Humboldt Mt. Diablo San Bernardino Township = 36 sections Section = 1 sq. mile = 640 acres Acre = 43,560 sq. ft.

Townships : 

Townships 36 square miles Townships run north  in tiers (think wedding south cake tiers) east  west in ranges

Estates in Land : 

Estates in Land Fee simple estate Fee simple absolute Fee simple qualified Life estate Reversion returns property to original owner when life estate ends Estate in remainder transfers property to someone else when the life estate ends

Taking title to real estate : 

Taking title to real estate Grantor conveys title by grant deed to grantee, who is identified as one of these: Single (never married) Married Unmarried (divorced) Widow Widower

Forms of ownership : 

Forms of ownership Ownership in severalty is ownership by one person. It is also called... Separate ownership Sole ownership

Concurrent ownership : 

Concurrent ownership Ownership by more than one person can be: Tenancy in common Unity of possession Joint tenancy Unity of time Unity of title Unity of interest Unity of possession

Concurrent ownership (cont.) : 

Concurrent ownership (cont.) Community property Quasi-community property is property acquired by an out-of-state married person (or California real estate acquired in exchange for real or personal property located anywhere) that would be community property if acquired by a California resident Tenancy in partnership

Business ownershipof real estate : 

Business ownershipof real estate Sole proprietorship Corporation For-profit is owned by shareholders Nonprofit is owned by members Domestic if incorporated in California Foreign if incorporated elsewhere S corporation offers tax advantages A corporation can limit liability of officers, directors and shareholders

Business ownership (cont.) : 

Business ownership (cont.) Trust—Title is conveyed by trustor to trustee for benefit of beneficiary Real Estate Investment Trust (REIT): Regulated by Commissioner of Corporations Must comply with federal and state tax law Must be owned by at least 100 different investors Cannot have five investors own more than 50% of trust Must receive at least 95% of income from investments Must receive at least 75% of investment income from real estate Living trust

Business ownership (cont.) : 

Business ownership (cont.) Limited partnership Real estate syndicate REIT, corporation, general partnership or other entity Limited liability company (LLC)

Information on the Web : 

Information on the Web Secretary of State Business Service Center www.ss.ca.gov/business/business/htm

How real estatemay be acquired : 

How real estatemay be acquired By succession or will dying with a will = testate dying without a will = intestate By accession improvements accretion reliction By occupancy adverse possession prescription By transfer public or private grant or other means

California Law ofIntestate Succession : 

California Law ofIntestate Succession Community property If spouse survives: ½ already belongs to surviving spouse Remaining ½ goes to surviving spouse Separate property To surviving spouse, children (if any), and other next of kin as provided by California law If no heirs are located, property escheats to state

Acquisition by accession : 

Acquisition by accession Improvements may increase property Land adjacent to flowing body of water can be increased by accretion New soil is called alluvion or alluvium Soil may be lost by avulsion Reliction occurs when soil is uncovered as waters recede

Acquisition by occupancy : 

Acquisition by occupancy Adverse possession requires use to be: Open Notorious Continuous Hostile Adverse to interests of real owner Adverse user must pay property taxes for at least five years of the possession

Acquisition by transfer : 

Acquisition by transfer Private grant Public grant Public dedication Common law Statutory Operation of law or by a court Action to quiet title Partition action Power of sale Judicial foreclosure action Action for declaratory relief

Acquisition by transfer (cont.) : 

Acquisition by transfer (cont.) Execution sale Forfeiture Bankruptcy Marriage Escheat Eminent domain Equitable Estoppel

Elements of a valid deed : 

Elements of a valid deed In writing Description of parties Grantor legally capable Description of property Granting clause Signed by grantor(s) Delivered to grantee and accepted by grantee

Acknowledgment and recording : 

Acknowledgment and recording Document is executed when signed. Acknowledgment is a declaration that execution is declarant’s own act. California-licensed notary public may take acknowledgment anywhere in the state. Recording must be done in the county where the property is located. Chain of title contains all instruments in property’s recorded history.

Types of deeds : 

Types of deeds Grant deed—implied warranties Gift deed Quitclaim deed Warranty deed Trust deed Reconveyance deed Sheriff’s deed Tax deed

Encumbrances : 

Encumbrances An encumbrance is anything that affects or limits the fee simple title to real estate or affects the property’s condition or use. Marketable title may be defeated by a cloud on the title.

Liens : 

Liens Voluntary = Agreed to by owner Involuntary = Imposed without owner’s consent Specific = On named property only General = On all nonexempt property owned Mechanic’s lien is available to any of the following employed by owner or owner’s agent: mechanics, material suppliers, contractors, subcontractors, equipment lessors, artisans, builders, architects, registered engineers, licensed land surveyors, machinists, teamsters, laborers, and union trust fund

Mechanic’s lien : 

Mechanic’s lien Preliminary notice should be made within 20 days from the time work begins Starting time of work determines priority of lien claimants Completion time occurs when: work stops and owner (or agent) occupies or uses improvement; owner (or agent) accepts work; work has stopped for 60 continuous days; or owner files notice of cessation and work has stopped for 30 continuous days.

Mechanic’s lien (cont.) : 

Mechanic’s lien (cont.) Notice of completion may be filed by owner within 10 days after completion of improvement. Filing time for mechanic’s lien: by original contractor of all or part of job, within 60 days after filing of notice of completion; by any other claimant, within 30 days after filing of notice of completion; or within 90 days after completion, if a notice of completion was not filed.

Mechanic’s lien (cont.) : 

Mechanic’s lien (cont.) If a mechanic terminates a lien voluntarily, a release of lien should be filed. Lien release bond allows owner or other party to stop foreclosure of lien if validity is disputed. Notice of nonresponsibility must be posted within 10 days of owner’s knowledge of unauthorized work.

Legal process : 

Legal process Attachment allows the court to take possession of defendant’s assets. Judgment of court is its determination of rights of parties. Final judgment becomes a lien on the property of the judgment debtor after recording of the abstract of judgment. Writ of execution from the court directs the sheriff to sell nonexempt property of debtor to pay judgment debt. Discharge follows satisfaction of debt. Notice of satisfaction should be filed.

Bankruptcy : 

Bankruptcy Federal court proceeding Trustee in bankruptcy holds title to debtor’s assets liquidates assets if necessary to pay creditors.

Easement : 

Easement Easement is the right to use the land of another. Dominant tenement benefits from easement. Servient tenement is land over which easement lies. Easement appurtenant runs with the land Easement in gross belongs to an individual.

Creation of Easement : 

Creation of Easement By contract By express grant from owner of easement property By reserving an easement over land that is transferred By implication of law By long use By condemnation By prescription

Termination of easement : 

Termination of easement Express agreement of parties Lawsuit Abandonment (nonuse) of prescriptive easement Estoppel Merger of dominant and servient tenements Destruction of servient tenement Adverse possession Excessive use

Restrictions : 

Restrictions CC&Rs Conditions, Covenants and Restrictions Usually found in declaration of restrictions filed by subdivision developer Covenant is a promise to do or not do something Condition may be precedent or subsequent Restriction is prohibition against a use A condition cannot impose a restraint on alienation—something that would prohibit the property from being transferred to a new owner.

Restrictions (cont.) : 

Restrictions (cont.) CC&Rs are terminated by: Expiration of terms Voluntary cancellation Merger of ownership Governmental act Change in condition that warrants court action to remove the restriction

Other limitations on property use : 

Other limitations on property use Zoning—act of city or county Encroachment—part of an improvement extends over a boundary line Homestead—exemption from creditor claims Homeowner $ 50,000 Homeowner/family unit 75,000 Homeowner/spouse 65 125,000 Homeowner/spouse disabled and unemployable 125,000 Homeowner 55, low income 125,000

American Advantage Law Group : 

American Advantage Law Group 3848 Campus Dr. Suite #206Newport Beach, CA 92660 949-863-1888 (phone) 949-863-1888 (fax) americanlawfirm411@gmail.com Real estate seminars held 1 PM PST every Wednesday

Disclaimer : 

Disclaimer The materials available at this web site are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between American Advantage Law Group and the user or browser. The opinions expressed at or through this site are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney.

authorStream Live Help