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Showing posts with label Eye on Real Estate. Show all posts
Showing posts with label Eye on Real Estate. Show all posts

Monday, January 20, 2020

Eye on Real Estate Q&A: Co-op Disapproval of Sale and Suing the Board

On this week's episode of Eye on Real Estate, January 18, 2020, we were asked about suing a cooperative board for refusing a sale by creating an absolute floor price, which unit owners had to obtain in order to sell units to third-party purchasers.

Initially, we discussed the business judgment rule, which generally protects boards from lawsuits as long as the board acted in good faith and in accordance with it's power. 

However, there can be a case against the board where the board created an absolute floor price in bad faith or if the board created the absolute floor price beyond its powers as set forth in the bylaws. 

As the courts explain, the test is whether the board's floor is "a provision merely postponing sale during the option period," which is permissible or, if it is, instead, "an effective prohibition against transferability itself," which is impermissible. 

So, if you are being blocked on price, consider a lawsuit after you obtain and review the bylaws. 

For a great explanation of this issue, see Oakley v. Longview Owners, Inc.


Eye on Real Estate Q&A: Rent Control Succession Rights

On this week's episode of Eye on Real Estate, January 18, 2020, we were asked about succession rights of a niece on rent controlled property.

NYC's Rent Guidelines Board actually answers this question as follows:

A rent controlled tenant cannot grant the right to live in the apartment through a will. Nor can someone succeed a rent controlled apartment by paying the rent with personal checks. There are specific rules about who may succeed a rent controlled apartment.In general, for rent controlled apartments throughout New York State, any "family member" of the tenant may have the right to protection from eviction when the tenant dies or permanently leaves the apartment.The family member's right to protection from eviction is dependent upon such family member having resided with the tenant as a primary resident in the apartment for two years immediately prior to the death of, or permanent leaving of, the apartment by the tenant (one year for family members who are senior citizens or disabled persons).The family member may also have the right to protection from eviction if he/she resided with the tenant from the inception of the tenancy or from the commencement of the relationship.If all the requirements for succession are met, the new tenant's rent would be the same as it was when your aunt was the primary tenant, until the next increase, which can occur once a year in rent controlled apartments. 
For definitions of family members, disabled persons and more information, see HCR Fact Sheet #30: Succession Rights.
Or, you may wish to contact NYS Homes and Community Renewal (HCR), the state agency which administers the rent laws.---
It's noted that a niece is not a listed family member for succession rights at 9 NYCRR 2204.6(d)(3) and therefore must prove emotional and financial commitment and interdependence between such person(s) and the tenant to have succession rights on top of the 2 year requirement.

So, as we suggested on the radio, please consult with an attorney rather than just going it alone when seeking these valuable succession rights through a succession application to DHCR. The alternative is an eviction proceeding being brought against you.

Listen to the podcast here. 


Friday, January 10, 2020

New Law: Mortgage Forgiveness Debt Relief Act Extended to 1/1/2021

On December 20, 2019, Public Law No: 116-94 extended 26 USC 108(a)(1)(E) to 1/1/2021. 

According to the IRS, this law "allows taxpayers to exclude income from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualify for this relief."

Short sales, modifications with debt forgiveness, and deeds in lieu of foreclosure are now viable options for many more distressed homeowners for the remainder of 2020.

Monday, January 06, 2020

New Law: Nuisance Call Act - RE Brokers Be Warned - Telemarketers Must Give a Warning to Avoid Heavy Fines

On December 6, 2019, S4777, the Nuisance Call Act, became law and telemarketers must now give specific information to customers starting on March 5, 2020, the effective date of the law, or face heavy fines.

Under the Nuisance Call Act, General Business Law section 399-z now requires that a "telemarketer or seller [] inform[s] the customer that he or she may request that his or her telephone number be added to the seller's entity specific do-not-call list" where the telemarketer must immediately end the call if the customer so elects.

This is serious - fines can be up to $11,000 per violation if you fail to give this information.

Real Estate Brokers must advise all of their associated Real Estate Salespersons immediately and train their teams. In fact, a defense to a fine includes that "the person has trained his or her personnel in the requirements of this section."

Get your training today at Lieb Compliance, LLC.

Tuesday, December 24, 2019

New Law: Foreclosure Standing Never Waived - Renew Your Case Today

On December 23, 2019, S5160 was enacted and "the defense, in a mortgage foreclosure action, of the plaintiff's lack of standing is not waived because of the defendant's failure to raise such defense in his or her responsive pleading."

A standing defense is utilized to argue that the plaintiff is not the right party to sue in that it's not the owner of the mortgage or debt and has not been appointed the power by such owner to pursue the lawsuit. This is one of the most significant changes to the foreclosure litigation practice since the Great Recession and will impact litigation for years to come.

Real Property Actions and Proceedings Law section 1302-a is an early Christmas present to defendants in ongoing litigation as it took effect immediately and appears to apply up until sale even if a Judgment of Foreclosure has already been ordered. Specifically, the new section states that "[a] defendant may not raise an objection or defense of lack of standing following a foreclosure sale." As such, it appears the defense of standing can be raised at any time before the sale.

If you are defending a case that is post-Judgment of Foreclosure and Sale and pre-auction sale, you may want to consider bringing an Order to Show Cause with a Motion to Renew pursuant to Civil Practice Law & Rules Rule 2221-e immediately.