Legal Questions & Answers

The closing attorney for the sale of our Dedham home didn’t payoff FHA loan properly.

Additional Information:

The closing attorney for the sale of my home in Dedham, MA was aware of the necessity to payoff my FHA loan at a certain time to avoid additional fees. The payoff was rejected by my lender because it wasn’t a “certified check, cashier’s check, or bank wire”, as required by the lender’s Payoff Statement. After being contacted by the lender, he then sent a certified check which was received after the deadline and I was charged additional interest and fees. He admitted to ignoring the lender’s requirements, but refuses to reimburse me because he was not responsible for the payoff of my loan. What can I do?

ATTORNEY ANSWER:

You may have a cause of action against the closing attorney since he assumed the responsibility regarding the payoff of the FHA loan, including timeliness of correct payment. Having assumed the responsibility for payment of the payoff, he is now liable for any late fees or penalties that have resulted from his negligence or oversight. You should make a formal demand upon him for reimbursement.   If he fails to pay, you have a good cause of action against him and could seek multiple damages in court plus attorney fees and costs.  [Read more...]

The seller signed a P & S agreement to pay our closing costs of our Needham home.

Additional Information:

We are buying a home in Needham, MA. The seller signed a purchase and sale agreement to pay for our closing cost, but he says he did not know that what he signed was actually to do this. The sellers now understand that what they signed is seller’s concession towards buyers closing cost but the sellers never intended to pay the buyers closing costs and they don’t even have their own seller’s agent in an attempt to save money and not pay a realtor commission. My question is, are they liable to pay for our closing costs?

ATTORNEY ANSWER:

Yes, the seller will be liable to pay for your closing costs. The purchase and sale agreement is a legal contract.  However, the maximum amount the seller can pay may depend on the loan program, and, in some cases the amount you’re putting down to purchase the home.  For example, for FHA and USDA loans, sellers can contribute up to 6% of the purchase price towards closing costs. For FHA loans, seller concessions will soon be reduced to 3%.

The Lender may decide to disallow a specific expense on the “Closing Statement”. The Government approved closing statement is called a HUD-1, and the buyer and seller are given one to approve at the closing on the sale. The HUD-1 lists the details of all expenses and payments in the sale, and it is on this document that the lender may disapprove of an item.

Since lender approval of the HUD-1 is the final step standing in the way of completing the sale, buyers often accept the lenders terms, even though it is their loss. However, if you are lucky enough that the seller contracted to pay the buyers closing costs, then the seller is liable and he will be responsible for covering the closing costs he contracted to pay for. If he refuses to proceed with the closing, you can sue him to complete the transaction.  That is called a suit for specific performance.  The alternative is to re-open the negotiations, which can be a quicker approach.  [Read more...]

We are buying a house in Quincy, MA.

Additional Information:

We are buying a house in Quincy, MA and the seller didn’t provide the Property Transfer Lead Paint Notification form before signing the Purchase and Sale Agreement.  This is a clear violation of MA law and Federal law. Can this be used as a negotiating point to lower the sale price?

ATTORNEY ANSWER:

It depends upon whether or not the seller knowingly violated the law. If you are unable to prove that the seller knew of the lead paint and knowingly violated MA and federal law by not providing the Property Transfer Lead Paint Notification, then you will not have a cause of action as the seller must be aware of his violation to be found liable. However, on the other hand, if you are able to prove that the seller violated MA and federal law by having knowledge of the lead paint and not providing the Property Transfer Lead Paint Notification, then yes, you may use this as a negotiating point.

A seller who knowingly violates the law shall be jointly and severally liable to the buyer in an amount equal to 3 times the amount of damages incurred by the buyer under federal law. Also under federal law, a court may award court costs to the buyer, together with reasonable attorney fees and any expert witness fees, if the buyer prevails. Under MA state law, real estate agents, property managers and certain landlords and sellers, where applicable, may be subject to civil liability under the Consumer Protection Statute, M.G.L. c. 93A, which allows award of up to two or three times actual damages and attorneys fees. [Read more...]

I agreed to buy a house in Newton, MA.

Additional Information:

Now I’ve changed my mind. How do I get out of it?

ATTORNEY ANSWER:

Prospective homebuyers who want to escape a purchase contract should turn first to the agreement itself. Most states require that real estate contracts be in writing to be enforceable, and most real estate contracts include contingencies, or conditions, that must be met for the deal to close.

Contingencies offer various ways to cancel a contract up until the minute when the contingency is either met or its associated time period expires. Which contingencies are included in a contract depends on state law, local custom, and negotiations between the seller and buyer. Some examples of common contingencies include appraisals, home inspections, and an inability to get a mortgage and title. For instance, if the property isn’t appraised at the value that they agreed to, the bank isn’t going to give the buyer the money to buy the property, so that’s obviously a definite out. [Read more...]

Can I use my tenant’s security deposit for unpaid rent?

Additional Information: I am a landlord and own property in Brookline and Newton. A few of my tenants are behind in rent and I’d like to cover my costs by using their security deposit.

ATTORNEY ANSWER:

Yes you can but you must strictly comply with the Security Deposit Law and give the tenant a notice by certified mail within 30 days of them vacating that you are applying unpaid rent to the security deposit. [Read more...]

Can we collect damages for real estate misrepresentation in MA?

ADDITIONAL INFORMATION:
What are allowable damages for real estate misrepresentation under Massachusetts law? We signed a P & S with the sellers which had multiple items that were supposed to be completed by the seller prior to closing. They did not complete the work and now refuse to return our deposit money. What are my legal rights?

ATTORNEY ANSWER:
You can either sue to enforce the agreement which would be a breach of contract action for specific performance or simply sue to obtain a return of your deposit. You should check the provisions of the purchase and sale agreement closely to determine if these issues are addressed in the agreement. If the Seller is a business, you could have possible double or triple damages and attorney’s fees available to you. [Read more...]

How do I evict my tenant in Massachusetts?

ATTORNEY ANSWER:

You first must determine what type of relationship you have with your tenant. The rules of the game change with this determination. There are two main types of tenancies; one at will and one under a lease. Traditionally, tenancies at will were oral. This is no longer the case. In general, if a tenancy is oral or even if it is in writing, with the provision that either the landlord or tenant can terminate the relationship by giving a notice that is equal to the interval between the days of payment or thirty (30) days, whichever is longer, it is a tenancy at will. One can easily obtain this Notice to Quit from a legal stationery store, a constable, or a rental housing association. [Read more...]

What do I do when I receive a notice to quit?

ATTORNEY ANSWER:

Read the notice to quit to understand the reason. If the reason is for nonpayment of rent, you may be able to stop the eviction process by paying what is due by a specified time. The rules vary depending upon whether the tenant is one at will or whether one under a lease. If the tenancy is at will, the rule varies depending upon whether this is the first notice to quit received within the last twelve (12) months. After the notice to quit has run its course, you should expect to be served by a Constable or Sheriff with a Summary Process (eviction) Summons and Complaint form. You may well want to consult with an attorney. [Read more...]

Are Interrogatories and documents filed in the Housing Court?

ATTORNEY ANSWER:

They are filed in summary process (eviction) cases but in civil cases Standing Order 1-96 of the Housing Court states that discovery does not need to be filed with the Housing Court. [Read more...]