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Worcester Real Estate Law Blog

Unlikely Boston entity enters into commercial lease agreement

Although it may not be a typical commercial real estate player, the Roman Catholic Archdiocese of Boston has reportedly entered into a commercial lease.

The church property, a parking lot, is located in Boston's South End. The leaseholder has plans to transform the lot into a rental apartment building, complete with an underground garage and retail spaces on the ground floor. Best of all, the church will reportedly be assigned 70 spaces in the underground garage.

Buying a home? Consult with an attorney to for ease of mind

A recent homebuyer’s guide recommended consulting with an attorney before closing on a real estate deal. That advice should be heeded for several reasons.

An attorney can review a purchase agreement for potential legal consequences. Often, a seller and/or the seller’s agent might use a standardized form with fine print. Yet boilerplate language may fail to address unique issues that may arise when a buyer has plans to renovate the property, or a home inspection reveals hidden defects. Most importantly, an attorney can review the agreement’s provisions to ensure that it is subject to a buyer’s ability to obtain financing. 

Are closing costs unavoidable?

Closing costs for a mortgage or refinance loan are sometimes offered as an incentive in real estate transactions, but could they make or break a deal?

Admittedly, closing costs can add up. Homebuyers might pay between two and five percent of a home'€™s purchase price in closing costs, if not more. Such costs may include fees for third-party services such as appraisals and credit reports, or simply fees charged by the lenders themselves.

Owners who were foreclosed upon pass the seven-year itch

It may seem hard to believe, but it has been seven years since the financial crisis of 2007. The repercussions from that crisis were felt in various industries, including the housing market, and long-lasting. Indeed, the economic recovery has been years in the coming.

Nevertheless, the seven-year marker is significant because many homeowners who lost their properties to foreclosure are now able to start repairing their credit. Specifically, data collected by a real estate analyst firm indicates that almost a half million Americans are now past the seven-year waiting period for new mortgage applications that is imposed after an individual goes through a foreclosure. 

Is a higher mortgage rate worth the extra liquidity?

When purchasing real estate, there are several financing approaches a buyer might take. 

For someone interested in a long-term commitment, it may make sense to make a sizable down payment in order to qualify for the lowest interest rates on a 20-year or even 30-year mortgage. 

Buy a house based on due diligence, not emotion

Although making an “as-is” purchase may be a calculated risk in certain situations, an attorney that focuses on real estate law might caution against applying this approach when buying real estate. In the parlance of real estate law, such “as-is” language might be termed inspection and mortgage contingencies.

Of course, this advice might be easier said than followed, especially in a seller’s market and/or when a buyer has fallen in love with a prospective new property. Fortunately, an attorney can help a buyer avoid making such emotion-based decisions in the heat of the moment. An inspection can reveal serious flaws, such as areas requiring plumbing or electrical work, a roof in need of repairs, or termite damage.

Is real estate permitting easier with a renewable project?

When a real estate developer is applying for real estate permits, getting approval from a federal agency is certainly a positive sign. However, it’s not necessarily a guarantee of smooth sailing in the realm of real estate law.

For example, two Massachusetts electric utility companies had expressed interest in a proposed wind turbine project on Cape Cod. The project, if completed, would have been the first offshore wind farm in the United States. However, the companies backed out of the project before construction of the 130-turbine wind project ever began.

Is obtaining a real estate permit approval ever easy?

Information about the various permits and approvals needed to move forward with a commercial development project is provided on the websites maintained by many municipal governments in Massachusetts. For example, the Boston Redevelopment authority maintains a website where information about zoning and planning can be found.

However, a real estate attorney would caution that ease of accessibility should not lull prospective real estate investors or developers into a false sense of security. The process of obtaining permits and zoning approvals is often not as easy as the municipal websites would suggest. In addition, zoning disputes might arise even after a project has started, forcing construction to a halt until the applicable zoning authority has once again granted approval. Such delays can be costly.

Municipal program offers mortgage assistance to Boston buyers

Readers may not have known about an incentive home buying program offered by the city of Boston.

Specifically, prospective buyers who have completed two classes offered by the Boston Department of Neighborhood Development may qualify for financial assistance toward the purchase of a family home or condo. In fact, buyers may receive up to $20,000 toward their down payment and closing costs. Assistance may also be available for the purchase and repair of a foreclosed property, with up to $10,000 applied in each category. 

Do foreclosures present an investment opportunity?

In recent years, lenders may have allowed a grace period for homeowners struggling with delinquent mortgage payments. However, that safety net has apparently been removed, considering that foreclosure filings in Massachusetts have increased by 91 percent from October 2013. In fact, foreclosures have been on the rise for eight consecutive months in the state.

A real estate attorney knows that foreclosure filings can also present a potential purchase opportunity for home hunters. In fact, some investors specialize in buying distressed properties, fixing them up and then selling them at a profit. However, the disclosure rules in a foreclosure proceeding are different than the ordinary real estate transaction. That can lead to a nasty surprise when hidden defects come to light. 

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