The DRE's significance is underlined by its historical foundation, marking the enactment of the nation's first real estate license law in 1917. The establishment of the first real estate license law in Read more...
The DRE's significance is underlined by its historical foundation, marking the enactment of the nation's first real estate license law in 1917. The establishment of the first real estate license law in 1917 by the DRE was indeed a landmark event in the United States. This was a pivotal move because it signified the first step toward formal regulation in the real estate industry, which involves high-value transactions and constitutes a significant portion of the economy.
Before this point, the real estate industry lacked standardized practices, potentially leading to fraudulent activities, misinformation, and inconsistencies that could harm consumers and destabilize the property market. The introduction of licensing laws brought a level of oversight, accountability, and professionalism that needed to be included. It meant that practitioners must adhere to professional standards, ensuring they had a requisite level of knowledge.
Furthermore, this historical foundation is not just about regulating individuals involved in the buying and selling real estate; it also sets a precedent for real estate law and regulation nationwide. This action back in 1917 underscores the DRE's long-standing role as a pioneer in shaping the landscape of the real estate industry. This fact might surprise those unfamiliar with the historical depth of formal real estate regulation in the United States.
This landmark regulation set the stage for the department's reputation as a nationwide influencer, standardizing practices in real estate and ensuring that buying and selling properties is conducted under at least some oversight.
The DRE serves a critical role within the realm of property transactions. As real estate is one of the most significant sectors in the financial market, the DRE is fundamental in ensuring the legitimacy, fairness, and legality of real estate transactions. These transactions, complex and multilayered, require stringent regulation for the protection of all parties involved, ultimately safeguarding the dynamics of buying, selling, and managing real estate.
At its core, the DRE is committed to safeguarding and promoting public interests. This is achieved through various methods, including the rigorous process of licensure that ensures only qualified individuals can hold a real estate license and regulatory practices that maintain legal and ethical standards in the industry. Furthermore, through educational programs and enforcement actions, the DRE works to uphold integrity and protect consumer rights and investments.
The DRE can also advocate for consumers, ensuring that industry practices adhere to legal and ethical standards. Advancing its role as a protector, the DRE embraces technology for service enhancement, ensuring secure information handling and improved accessibility, aiding consumers in making informed decisions. The department is a leader in adapting to evolving real estate landscapes, providing consumer protection, and promoting outreach programs that educate and empower public decision-making.
Funded primarily through the revenue obtained from licenses and permits, the DRE boasts a comprehensive operational structure with a significant geographical presence. This system allows it to effectively monitor real estate transactions and enforce regulatory compliance, ensuring the integrity of the real estate market.
The Real Estate Commissioner an appointed position, carries substantial responsibility and authority in enforcing the Real Estate and Subdivided Lands Laws. This role is pivotal in upholding consumer protection, exercising impartial judgment, and ensuring that every real estate transaction adheres to established legal and ethical standards.
The DRE is dedicated to protecting public interest and enhancing consumer awareness, consistently working to elevate industry standards and ethics. This dual focus ensures that consumers receive fair treatment and that professionals within real estate maintain the highest level of integrity and competence.
Today, obtaining a real estate license ensures only qualified individuals engage in the practice. It involves meeting specific educational criteria, passing the real estate exam and complying with established standards of practice and experience. The DRE also mandates regular license renewal and continuing education, ensuring that real estate professionals are current with evolving industry trends and regulations.
The DRE is firmly committed to enforcing legal standards and conducting thorough investigations based on public complaints. Violations of regulatory compliance have significant consequences, underlining the department's dedication to maintaining ethical practice and consumer trust in the real estate market.
The Consumer Recovery Account is another vital DRE feature, providing financial protection to consumers who have incurred losses in real estate transactions due to a licensee's unethical or illegal actions. This provision underscores the DRE's commitment to maintaining fairness and trust within the real estate sector.
Subdivision laws protect property buyers, ensuring they receive accurate, transparent information before purchasing subdivided lands. Compliance requirements for subdividers and the role of public reports are fundamental in this process, safeguarding buyer interests and investments.
In overseeing mortgage loan activities, the DRE ensures that real estate licensees comply with legal standards, further protecting consumer interests. This oversight extends to certain mortgage brokers, emphasizing the DRE's comprehensive approach to regulation and compliance within real estate transactions.
Through its various publications, including the Real Estate Bulletin and other educational resources, the DRE informs stakeholders about regulatory changes, trends, and important information affecting the real estate market. These resources further demonstrate the department's commitment to transparency and education in real estate practices.
The Department of Real Estate plays a critical role in regulating the real estate industry, providing mechanisms for public protection, and ensuring ethical practices in real estate transactions. Through its ongoing commitment to service, education, and transparency, the DRE continues to uphold its mission, adapting to the needs of consumers, professionals, and stakeholders in the ever-changing real estate landscape.
In its century-long journey since pioneering the nation's first real estate license law, the Department of Real Estate (DRE) has emerged as an indispensable guardian of ethical integrity, legal compliance, and consumer protection in the property market. By meticulously regulating licensure—underscored by the necessity of the real estate exam—and steadfastly enforcing standards, the DRE fortifies public trust and fairness in complex property transactions. This commitment extends from the vigilant oversight of market practices by the Real Estate Commissioner to the security offered by initiatives like the Consumer Recovery Account. Furthermore, the DRE harnesses technology and comprehensive educational outreach, ensuring transparency, informed decision-making, and responsiveness to the evolving dynamics of real estate. Ultimately, the department serves as a guiding entity, providing direction to all stakeholders through its consistent focus on service, accountability, and safeguarding interests in the fluctuating environment of real estate transactions.
Love,
Kartik
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Selling real estate is as much about understanding the buyer as knowing the property. One must delve into the buyer's psychology to excel in sales negotiation. No matter how good your marketing may be, Read more...
Selling real estate is as much about understanding the buyer as knowing the property. One must delve into the buyer's psychology to excel in sales negotiation. No matter how good your marketing may be, the best real estate agents can recognize the buyer's motivations, anticipate and understand the objections they might raise, and master persuasive communication techniques. By doing so, real estate professionals can tailor their approach to align with the buyer's mindset and needs.
Sell the dream, not just the house.
Innovative real estate marketing is about selling a lifestyle, a dream, not just the square footage. It's about crafting compelling narratives that resonate with the buyer's deepest aspirations. More than just being a real estate agent who knows square footage and property values is required. To truly excel, you need to be a mind reader. Unmasking the desires and anxieties of your buyers is the key to unlocking lucrative deals.
Dive into their heads:
Why are they buying? Is it a starter home for a growing family, a retirement haven, or a strategic investment? Knowing their motivations is like holding a treasure map to their deepest needs.
What scares them? Is it tight finances, a bad neighborhood, or hidden repairs? Anticipating and addressing their objections builds trust and shows you're genuinely invested in their well-being.
Speak their language, not yours. Ditch the technical jargon and master persuasive communication. Paint a vivid picture of their future in that house, highlighting how it solves their problems and fulfills their dreams.
Remember, it's not about you; it's about them. By tailoring your approach to their unique mindset, you become more than a salesperson – a trusted advisor, a confidante, someone who guides them towards their real estate happily ever after.
In short, Become a master of buyer psychology and watch your sales soar!
Active Listening and Empathy: The Foundation of Rapport
Building rapport is essential in real estate negotiations. This starts with active listening and empathy. By actively listening, agents can uncover their clients' hidden needs and desires, which might not be immediately apparent. Empathy allows agents to connect with buyers personally, fostering trust and understanding. This trust is crucial for establishing a positive negotiation environment where both parties feel heard and valued.
Mastering the Art of Rapport in Real Estate Negotiations
Building rapport isn't just a feel-good tactic in real estate negotiations – it's a power move. It's like having a secret decoder ring for your client's hidden needs and desires. Here's how to turn active listening and empathy into negotiation superpowers:
1. Go beyond surface-level listening: Actively engage, ask open-ended questions, and truly hear what's beneath the words. Is the buyer hesitant about the commute? Maybe it's not just time, but the thought of leaving their aging parents behind. Uncover those deeper concerns, and you'll strike gold.
2. Become a chameleon of empathy: Mirror their emotions, use validating phrases like "I understand," and show genuine interest in their perspective. When they feel seen and heard, trust blossoms, opening the door to productive negotiation.
3. Anticipate and address anxieties: Don't wait for objections to erupt. Preemptively acknowledge their concerns, like financing worries or neighborhood jitters. By showcasing your understanding, you build confidence and demonstrate your role as their advocate.
4. Speak their language, not yours: Ditch the real estate jargon and technical terms. Translate features into benefits, paint a picture of their future in that home, and focus on how it solves their problems and fulfills their dreams.
5. Remember, it's a two-way street: Share relevant details about yourself, build a personal connection, and show you're not just a robot in a suit. A touch of humanness goes a long way in fostering trust and rapport.
By mastering these tactics, you become more than an agent – a trusted advisor, a confidante, and a champion for your real estate dreams. When negotiations hit a snag, your unwavering empathy and understanding will be your secret weapon, paving the way to a win-win solution for everyone.
So, ditch the transactional approach and embrace the power of rapport. You'll close more deals, build lasting relationships, and leave your clients feeling heard, valued, and ready to sing your praises from the rooftops.
Preparing for Negotiation: Knowledge is Power
A successful negotiation in real estate is often the result of thorough preparation. This includes researching the property's value, understanding current market trends, and identifying potential concessions that could be made. By being well-prepared, agents can articulate a compelling value proposition that highlights how the features and benefits of a property align with the buyer's desires and needs.
Preparation: The Secret Weapon of Real Estate Negotiation Ninjas Imagine entering a negotiation with an arsenal of facts, figures, and insights, ready to dismantle any counterpoint like a ninja dissecting tofu.That's the power of preparation in real estate negotiations.
Here's how to transform from a negotiator to a negotiation domineer:
1. Become a data alchemist: Research the property inside and out! Comparable sales, local zoning regulations, and inspection reports – turn them into gold by understanding their implications for value and potential concessions.
2. Channel your inner economist: Master current market trends! Interest rates, inventory levels, buyer demographics – knowing the landscape lets you anticipate your opponent's moves and craft winning strategies.
3. Think like a poker player: Identify your "chips" – potential concessions like closing cost credits, appliance upgrades, or extended warranties. Know what you can offer without jeopardizing your client's best interests.
4. Forge the ultimate weapon: The Value Proposition: This isn't just about square footage and granite countertops. It's about how the property solves the buyer's problems and fulfills their dreams. Translate features into benefits, paint a picture of their future in that home, and showcase how it ticks all their boxes.
5. Practice makes perfect: Role-play potential scenarios with colleagues or mentors. Hone your articulation, anticipate objections, and refine your responses. Confidence breeds success, and preparation fuels confidence.
Remember, thorough preparation is like kryptonite to buyer hesitation. When you walk into that negotiation armed with knowledge, flexibility, and a compelling value proposition, you're no longer just an agent – a trusted advisor, a champion for their needs, and a master of the deal.
So, sharpen your research skills, study the market, and practice your pitch. With the proper preparation, you'll close deals and leave buyers feeling like they just won the real estate lottery.
Reaching Mutually Beneficial Agreements
The ultimate goal of any negotiation is to reach an agreement that benefits both parties. This involves closing the deal with clear terms, proper documentation, and a plan for post-sale follow-up. Ensuring all parties are satisfied with the outcome is essential for building long-term relationships and a strong reputation in the real estate market.
From Handshake to Happy Ever After Securing Win-Win Real Estate Deals
Negotiation isn't just about crossing the finish line – crafting a path to mutual satisfaction that lasts beyond the closing bell. Here's how to secure a win-win deal that cultivates loyal clients and builds a stellar reputation:
1. Seal the deal with clarity and care: Don't let excitement overshadow precision. Draft clear and concise contracts, address all contingencies, and ensure every detail is crystal clear. A solid foundation of paperwork prevents future headaches for everyone.
2. Documentation is your dance partner: Every promise, concession, and agreement needs to tango with the official documents. Thorough paperwork protects both parties and fosters trust, ensuring your happy ending isn't just a hopeful dream.
3. Don't disappear after the confetti falls: Follow-up is the secret sauce of client satisfaction. Check-in, answer questions, and offer support during closing and beyond. Showing you care even after the sale fosters loyalty and turns fleeting clients into raving fans.
4. Remember, it's about relationships, not just transactions: Treat your clients as partners, not just paychecks. Celebrate their success, build genuine connections, and go the extra mile. Happy clients become loyal advocates, praising you and fueling your future success.
5. Win-win is the ultimate trophy: By ensuring both parties feel heard, valued, and satisfied, you build a reputation for fairness and expertise. Word-of-mouth marketing beats any billboard, and happy clients attract even happier clients.
Remember, a successful negotiation isn't just about closing the deal – crafting a symphony of mutual satisfaction. By prioritizing clarity, documentation, follow-up, and lasting relationships, you transform yourself from a mere agent into a trusted advisor, a confidante, and a builder of real estate dreams. So, shake hands with confidence, knowing that you've secured a deal and laid the foundation for long-term success and a thriving reputation.
Mastering the Art of Real Estate Alchemy
Selling a house isn't just about matching square footage to shoe size. It's about transforming dreams into brick and mortar, anxieties into confidence, and negotiations into win-win symphonies. By mastering the art of real estate alchemy, you wield potent elements - buyer psychology, rapport, and preparation - to forge deals that shimmer with mutual satisfaction.
Remember, you're not just an agent; you're a:
Mind reader: Unearthing motivations, anticipating objections, and speaking the language of dreams.
Rapport alchemist: Building trust through active listening, empathy, and shared humanity.
Negotiation ninja: Armed with data, market trends, and a value proposition sharper than a shuriken.
Win-win architect: Crafting agreements that leave both parties singing from the rooftops (figuratively).
So, go forth and conquer the world of real estate, not with a briefcase but with a treasure map to your buyers' hearts and minds. Remember, the greatest deals are forged not just in steel and concrete but in the crucible of understanding, trust, and mutual dreams.
Embrace the art of real estate alchemy, and make it happen!
Love,
Kartik
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Top 5 Mistakes New Real Estate Agents Make After Getting Licensed (And How to Avoid Them)
Starting a career in real estate is exciting and has many opportunities. However, like any job, it has Read more...
Top 5 Mistakes New Real Estate Agents Make After Getting Licensed (And How to Avoid Them)
Starting a career in real estate is exciting and has many opportunities. However, like any job, it has its challenges. New agents might initially find it complicated, even after completing real estate school and getting their licenses. While getting a license is an important step, it's just the beginning. Challenges arise when handling property sales, building client relationships, and understanding market changes. I wanted to write an article to highlight common mistakes made by new agents and give advice on how to avoid them for a more rewarding real estate career.
Mistake 1: Not Building a Marketing Strategy
One of the most common pitfalls for newer real estate agents is the belief that clientele will magically gravitate toward them with little proactive outreach. This misconception can be detrimental to an agent's budding career. Today's real estate market is saturated, and standing out requires more than obtaining a license and setting up a desk in an office. Successful agents understand that a consistent and well-thought-out marketing strategy is at the heart of their business.
A robust marketing strategy is a combination of both online and offline efforts. In the digital age, online methods such as social media campaigns, targeted ads, email newsletters, and a professional website are indispensable. These tools increase an agent's visibility and help build credibility and trust among potential clients. On the other hand, offline methods like networking events, open houses, and local advertising play a vital role in community engagement and personal brand building. Together, these strategies form a comprehensive approach to reaching and attracting clients. For a new real estate agent, investing time and resources into a marketing strategy from the outset can make all the difference between a thriving career and one that never quite takes off.
Mistake 2: Neglecting Continuous Learning
Starting a real estate career usually begins with training, like what ADHI Schools offers. We prepare students for the licensing exam and give our students a basic understanding of the industry. But this initial knowledge is just the beginning. The real estate world constantly changes—new market trends, shifting property values, and updated regulations exist. So, while the foundation from schools like ADHI is important, agents shouldn't stop there.
To succeed, agents must keep learning. Regular training, workshops, and staying updated on the market are crucial. This continuous education helps agents stay ahead and better serve their clients. Simply put, the most successful agents know their learning never stops, even after formal schooling.
Mistake 3: Undervaluing Networking
The Power of Networking in the Real Estate Industry
For many newer real estate agents, passing the real estate exam marks a significant milestone in their budding careers. It's an achievement that opens the door to the vast world of property sales, acquisitions, and negotiations. However, a crucial aspect that can sometimes be overlooked in the initial stages is the immense value of networking.
While acing the real estate exam is a testament to one's foundational knowledge, the journey ahead requires more than just theoretical understanding; it demands connections, collaborations, and mentorships.
Failing to build a robust professional network can leave agents isolated in an industry where relationships often drive success. Engaging with local real estate groups, for instance, not only offers insights into regional market trends but also provides opportunities for collaborations and referrals. Likewise, attending industry events can introduce agents to seasoned professionals, potential clients, and even future mentors. These interactions often lead to partnerships, joint ventures, and other collaborative efforts that can bolster an agent's market presence and portfolio.
Furthermore, seeking mentorships can be a game-changer. A mentor can provide guidance, share experiences, and offer valuable advice on navigating the industry's complexities. They can be instrumental in avoiding common pitfalls and capitalizing on hidden opportunities.
So while passing the real estate exam is essential to establishing oneself in the industry,
the relationships built afterward often dictate the trajectory of success. Undervaluing networking can be a significant oversight, but with proactive effort, newer agents can weave a network that supports and propels their career forward.
Mistake 4: Not Setting Clear Goals and Milestones
In the bustling world of real estate, momentum and direction are paramount. One of the pitfalls that newer agents can sometimes fall into is navigating the industry without clear goals and milestones. Just as a ship without a compass can drift aimlessly, a real estate agent without set objectives may find themselves working hard but not necessarily smart. A lack of direction can significantly hamper growth, leading to missed opportunities and inefficient use of time and resources.
Setting both short-term and long-term goals is essential for charting a clear path forward. Short-term goals offer immediate targets, ensuring agents remain focused and motivated in their daily endeavors. These can range from acquiring a set number of new clients in a month to closing specific property deals. On the other hand, long-term goals provide a broader vision, guiding agents towards larger aspirations like becoming a top agent in their region or expanding into luxury or other high-end markets.
Other examples of short-term goals can be to tour several homes for sale in your target area each week to understand pricing and features. Another example might be to familiarize yourself with local market trends, neighborhood specifics, and school zones by a certain date.
Long-term goals as a real estate agent include achieving a specific income or commission amount by the end of 12 months or becoming one of the top agents in your office or area based on sales volume or closed deals. Other areas of long term growth might be to grow your team by hiring an assistant, a buyer's agent, or other supporting roles.
However, setting goals is only half the battle. Regular reviews are vital to assess progress and ensure alignment with these objectives. The real estate market is dynamic, and strategies that work today might need tweaking tomorrow. Agents can adjust their strategies by periodically evaluating their progress, ensuring they remain on the path to success.
In essence, while the real estate landscape offers vast opportunities, the agents with clear goals and the diligence to review and adapt find themselves at the forefront of success.
Mistake 5: Poor Time Management
The Pitfalls of Mismanaging Time in Real Estate
In the bustling world of real estate, time is of the essence. New agents are quickly introduced to a whirlwind of tasks, from back-to-back client meetings to endless property showings and the necessary (albeit boring) set of administrative duties. With effective time management, they can avoid drowning in these responsibilities, missing golden opportunities, and feeling unnecessary stress. Moreover, the work-life balance—vital for mental well-being and long-term productivity—crumbles when business tasks consume every waking moment.
The key to taming the time management beast is leveraging the right tools. Thankfully, today's technology offers many solutions tailored for real estate professionals. Whether it's an online calendar that nudges with timely reminders or a comprehensive CRM system that optimizes client interactions, there's a tool for every need. By incorporating these into their daily routines, agents can ensure they're not just busy, but productive. A structured schedule also earmarks moments for relaxation and personal time—because a burnt-out agent benefits no one.
The unpredictability of real estate demands discipline in time management. For new agents, knowing these challenges and being ready for them can lead to real success in the long run. Everyone makes mistakes, but being prepared and knowing how to handle common problems can help a lot. If new agents focus on good marketing, keep learning, build strong connections, set clear goals, and manage their time well, they can avoid many common mistakes.
Love,
Kartik
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Since its inception, Redfin has carved a unique niche in the hyper-competitive real estate landscape. Unlike its contemporaries—Keller Williams, Coldwell Banker, Compass, and others—Redfin bucked traditional Read more...
Since its inception, Redfin has carved a unique niche in the hyper-competitive real estate landscape. Unlike its contemporaries—Keller Williams, Coldwell Banker, Compass, and others—Redfin bucked traditional industry norms by offering its agents a salaried position. This model, a significant departure from the commission-based income structures prevalent in real estate brokerages, was one of Redfin's signature moves, ensuring a steady income for its agents and ostensibly fostering a client-first service where agents might feel less pressure to close deals merely for the sake of their earnings.
However, on January 1, Redfin is introducing a new commission-based program called Redfin Max, initially to be rolled out in Los Angeles and San Francisco. Despite the market slowdown due to rising mortgage rates, Redfin is not presenting this shift as a cost-cutting measure but as strategic planning for growth.
The thought is that this change, aimed primarily at attracting and retaining high-performing agents, can earn up to a 75% commission split without incurring business expenses, a significant shift from their fixed salary system. This new strategy is particularly appealing to agents who have recently passed their real estate test and are looking for lucrative commission structures, a route often taught as advantageous in real estate school.
The initiative responds to feedback from agents who want more earning potential, especially those with substantial client bases who could bring in more business. Despite this change, Redfin agents will remain full-time employees with benefits, maintaining their W2 status, which is rare in an industry where many agents work as independent contractors.
Jason Aleem, Redfin's vice president of real estate operations, sees this move as a way to compete for top talent, noting that salary limitations previously deterred some leading agents. The change aims to attract new agents, particularly those fresh from real estate school and eager to pass the real estate exam, and increase the earnings of current top performers, potentially pushing their compensation to $1 million. This approach aligns with the company's view that rewarding high performers will increase profitability.
The company anticipates positive outcomes from this change, though it's also a departure from its traditional model, signaling a new era for its operations and compensation structure. If successful in California, Redfin might consider expanding this model, prioritizing its growth and market share aspirations.
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Navigating the complexities of real estate and passing the real estate exam often requires a way to remember concepts, and acronyms can help. I wanted to write an article to share a few acronyms to Read more...
Navigating the complexities of real estate and passing the real estate exam often requires a way to remember concepts, and acronyms can help. I wanted to write an article to share a few acronyms to aid real estate license examinees to understand and recall critical concepts for the exam. I wanted to review terms like the "bundle of rights", factors determining property value, criteria to determine whether or not something is a fixture, the specifics of joint tenancy, the fiduciary responsibilities of agents, and the government's powers concerning property to help you pass the real estate exam.
Each one of these acronyms, from TEEUP to PETE, offers a snapshot of a broader principle. By familiarizing yourself with these, you'll better grasp concepts and be prepared for the California real estate exam. Let's break down these acronyms and highlight their significance in real estate.
Bundle of Rights
The "bundle of rights" is a foundational concept in real estate that refers to the rights associated with property ownership. When someone owns a property, they don't just own the physical land and buildings; they possess legal rights that can be separated and individually sold, transferred, or leased. These rights encompass various ways an owner can use, enjoy, or dispose of the property.
TEEUP: This represents a buyer's bundle of rights, which are:
Transfer: Lawfully transferring ownership.
Encumber: Borrowing against the property.
Enjoy: Peaceful enjoyment without disturbances.
Use: The lawful use of the property.
Possess: Exclusive possession rights.
Factors That Influence Value
Understanding the underlying factors that drive property value is essential. These are commonly represented by the acronym 'DUST' and are intertwined and play a critical role in the valuation process.
DUST: The pillars of property value:
Demand: How many qualified buyers are interested in the property.
Utility: Its usefulness.
Scarcity: Availability in the market and how many other properties are competing with the property in question.
Transferability: Ease of changing ownership.
Determining Whether or Not Something Is a Fixture
In real estate, distinguishing between personal property and fixtures can often lead to intricate debates and discussions. The line between an item considered a movable personal possession and a permanent property fixture is not always clear. Think about kitchen appliances, pool equipment, or even home theater components. To demystify this gray area and provide clarity, professionals often rely on a set of criteria aptly summarized by the acronym 'MARIA.' Let's unpack each of these criteria to understand better what makes an item a fixture in real estate.
MARIA: Criteria to determine if an item is a fixture:
Method of Attachment - The degree of permanence is based on the means of attachment.
Adaptability - Can the item be used elsewhere.
Relationship of parties - Between buyer and seller, the law tends to favor the buyer.
Intention during attachment - Was the intent of the owner to make the item a permanent part of the structure?
Agreement between parties - What did the purchase contract say about the item?
Unities to a Joint Tenancy Holding
Real estate ownership can be complex, especially when multiple parties are involved. Joint tenancy, a common form of co-ownership, allows multiple individuals to hold a shared interest in a property. However, specific conditions must be met for a joint tenancy to be established. These conditions ensure that each tenant's rights are protected and clearly defined. Summarized by the acronym 'TTIP,' these factors are crucial in defining and understanding the nuances of joint tenancy. Let's delve into each of these factors for a clearer perspective.
TTIP: Factors determining joint tenancy:
Time: Acquiring at the same time - All joint tenants must take title to the property at the same time.
Title: Acquiring via the same document - All joint tenants names must be listed on the same deed.
Interest: Equal stake in the property - All joint tenants must own an equal share of the property, regardless of capital contribution.
Possession: Equal possession rights - All joint tenants have the right to touch, use and occupy the entire property and cannot be physically divided.
Fiduciary Duties
Agents play a pivotal role in guiding, assisting, and representing clients. Yet, with this role comes a set of profound responsibilities. An agent's commitment isn't just about facilitating transactions - it’s anchored in a deep-rooted sense of trust and duty to their clients. These obligations, often termed fiduciary responsibilities, are essential in preserving the integrity of the agent-client relationship. Represented by the acronym 'OLDCAR,' these duties underscore the essence of being a trusted real estate professional. Let's explore each of these responsibilities in detail.
OLD CAR - Agent's fiduciary responsibilities:
Obedience - The agent must obey the lawful instructions of the principal.
Loyalty - The agent must be loyal to the client.
Disclosure - The agent must disclose all known material facts to the client.
Confidentiality - The agent must keep the client data confidential.
Accounting - The agent must account for the client funds.
Reasonable care/diligence - The agent must use reasonable care when dealing with the client.
Government Power Over Property
While property ownership bestows certain rights and privileges upon individuals, it's essential to recognize that these rights exist within a framework governed by higher authorities. Every government maintains inherent powers over properties within its jurisdiction, ensuring societal order, public interest, and the equitable use of land. Summarized by the acronym 'PETE,' these powers reflect the delicate balance between individual rights and the collective good. This section will delve into the government's four primary powers over property and their implications for owners.
PETE: The government's powers over property:
Police Power: Regulating for the health, safety and general welfare of the public.
Eminent Domain: Acquiring property for public use.
Taxation: Levying property taxes.
Escheat: Claiming property when an owner dies intestate (without a will).
TLDR
In a Nutshell: Acronyms are invaluable tools when studying for the California real estate exam aiding in efficiently recalling vital concepts. Commit these to memory to ensure a successful exam outcome. Remember, these aren't just random letters; they encapsulate essential real estate principles. Best of luck with your studies and the exam!
Love,
Kartik
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In real estate school, you learn that contracts are the backbone of all real estate deals. But there's more to contracts than meets the eye, especially when they go sideways. In this article, we'll demystify Read more...
In real estate school, you learn that contracts are the backbone of all real estate deals. But there's more to contracts than meets the eye, especially when they go sideways. In this article, we'll demystify the difference between two confusing terms: 'void' and 'voidable' as it relates to contracts.
Contracts 101
A contract is a promise that the law will enforce. It comprises a few parts: an offer, acceptance of the offer, and something valuable being exchanged by capable parties.
Void Contracts in Real Estate
A void contract is a promise that the law won't enforce. Imagine a person who isn't the actual owner of a property trying to sell a property they don't own. If someone tries to sell a house they don't own, that's likely an example of a void contract. In these cases, the law assumes that the contract never existed.
Another example of a void contract would be a contract to sell someone illegal drugs. The legality of the contract is a fundamental requirement for it to be valid. This means an agreement has to be for something legal. If it's not, the law won't recognize or enforce it
Therefore a contract to sell illegal drugs is void because selling illicit drugs is against the law. Since it's illegal, a contract to sell illegal drugs doesn't fulfill the requirement of legality.
In other words, you can't have a contract to do something illegal. That's why a contract like this is void - it's invalid from the start. So, if someone made a contract to sell illegal drugs and broke that contract, the other person couldn't take them to court. The court would say that the contract was void. The contract couldn't be enforced because it was to do something illegal.
Voidable Contracts in Real Estate
A voidable contract, on the other hand, is a contract that could work, but one person involved has the choice not to follow through with it. In these situations, the contract could become voidable.
A voidable contract is different from a void contract - It's a valid contract, but one party can agree or say no. Only one party is truly bound to the contract. The other party, who isn't bound, can say they don't want the contract anymore, and at that point, it becomes void or non-existent.
There are several reasons a contract might be voidable. These can include someone being forced or tricked into the contract, not understanding what they're agreeing to because of mental issues, being drunk, or lying about something important. Contracts made by minors (people under 18) are usually voidable, but they can only say no to the contract while they're still a minor and for a short time after they become an adult.
If a contract is made without the true agreement of one of the parties, it's considered a voidable contract. The law says a voidable contract can be enforced if one or more parties want it but not if the other parties don't want it to be. A voidable contract can become valid if the party who was wronged doesn't say they want to cancel it within a reasonable time.
Key Differences Between Void and Voidable Contracts
Although 'void' and 'voidable' may sound similar, they are distinct regarding contracts. Here's a breakdown of the major differences between them:
Validity: Void contracts are invalid from the outset. They lack legal standing from the moment they're created because they're based on an illegal act or lack a critical element necessary for a contract to be legally binding. On the other hand, voidable contracts are initially valid and legally enforceable. However, they may become void if the party having the right decides to nullify or reject the contract.
Option to Cancel: Void contracts do not offer the option to affirm or reject the contract. They are null from the start. In contrast, voidable contracts give one party the option to either continue or reject the contract, thereby making it void.
Enforcement: Void contracts cannot be enforced by any party or law because they are fundamentally flawed. But voidable contracts can be enforced, especially if the party with the right to reject the contract decides not to do so and proceeds with the agreement.
Participation: In a void contract, the parties involved can only be legally obligated to fulfill the terms if the contract is valid. All parties may be obliged to fulfill the contract terms for voidable contracts until the aggrieved party decides to reject the contract.
Examples of void contracts include contracts for illegal activities or contracts with impossible terms. Voidable contracts, however, often involve situations where one party was coerced, under undue influence, or somehow tricked into entering the contract.
Understanding these differences is crucial when dealing with real estate contracts. Carefully examining all terms and conditions can save you from unknowingly entering into void or voidable contracts, thus avoiding potential legal disputes or financial losses. Always consult a legal professional if you need clarification on a contract's terms or legality.
One other way to look at void and voidable
When you hear "void" about contracts, it means it's "nonexistent." It's like a rule that never counted from the start because it breaks some important laws or needs to include something required to make it a real contract.
Then there's "voidable," which suggests it could be void but not yet. The contract can still work, but there's a choice. One person in the contract can say it's void or let it stay as it is.
A void or "nonexistent" contract doesn't give any choices - it's just void. But a voidable or "potentially void" contract lets one person decide if it becomes void. That should help you tell the difference between the two.
Understanding the difference between void and voidable contracts is vital in real estate. It's as crucial as knowing when to when to walk away from a listing or the importance of a home inspection. Always remember to get professional help and check all contracts carefully.
As your online real estate school, we're here to help you understand these complex topics. We'd love to hear from you if you have any questions and remember, if you need more clarification, always ask a professional for help.
Love,
Kartik
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In real estate, few situations can be as challenging as facing foreclosure. Foreclosure happens when someone borrows money and uses their property as a guarantee but then stops making payments. The lender, Read more...
In real estate, few situations can be as challenging as facing foreclosure. Foreclosure happens when someone borrows money and uses their property as a guarantee but then stops making payments. The lender, who gave the money, tries to get their money back by selling the borrower's property.
In the context of homeownership, this means the possibility of losing one's home.
Understanding the California foreclosure process is not just crucial for those living in the Golden State, but also for students in real estate license school who are preparing to assist clients facing foreclosure or those interested in purchasing foreclosed properties. I wanted to write an article to delve into California's non-judicial (common) and judicial (super-rare) foreclosure processes, offering insights into what homeowners and real estate agents can anticipate during each step.
While this article can’t possibly cover every edge case or scenario, it serves as a starting point to help you learn about these concepts. This applies whether you're trying to avoid foreclosure, thinking about buying a foreclosed property or guiding a client through this challenging time.
Legal Framework for Foreclosure in California
Understanding the foreclosure process in California necessitates a look into its legal framework. The state's foreclosure proceedings are primarily governed by the California Civil Code 2924, which outlines the procedures lenders must follow when borrowers default on their mortgage payments.
The California foreclosure process falls into two categories: non-judicial and judicial foreclosures. Non-judicial foreclosures (as the name implies) occur outside of court, the most common type in California. The lender can initiate this process if the promissory note and deed of trust include a "power of sale" clause, permitting them to sell the property to recoup the outstanding loan balance following a default.
On the other hand, judicial foreclosures, though less common, involve a court proceeding. In this case, the lender files a lawsuit against the borrower to recover the unpaid mortgage balance. Understanding these two types of foreclosure processes is not only crucial for managing foreclosure situations effectively, but it also forms a critical part of the real estate exam that aspiring professionals must pass. In the following sections, I will delve into each process separately, providing a step-by-step overview of what homeowners and real estate professionals can expect.
III. Non-Judicial Foreclosure Process
Non-judicial foreclosure is the most common type of foreclosure in California, and it doesn't involve court action. This process is usually used when a power of sale clause exists in a mortgage or deed of trust. Here's a brief overview of the steps involved:
Notice of Default: If a borrower fails to make payments for a certain period, the lender may record a Notice of Default at the County Recorder's Office. The borrower is then sent a copy within ten days, initiating the non-judicial foreclosure process.
Notice of Trustee's Sale: If the borrower does not pay the default amount or negotiate a resolution within about three months, a Notice of Trustee's Sale is recorded. The borrower has 21 days before the home can be sold.
Trustee's Sale: If the borrower still hasn't remedied the default, the property is auctioned to the highest bidder, who must pay in cash.
Eviction: If the property is sold, the new owner obtains the right of possession and can begin eviction proceedings if the borrower does not vacate voluntarily.
Remember, the non-judicial foreclosure process has no right of redemption following the trustee’s sale and the sale is final.
IV. Judicial Foreclosure Process
While less common in California, a judicial foreclosure process comes into play when a mortgage does not include a 'power of sale' clause. It involves court proceedings and provides the borrower with a statutory right of redemption. Here are the main steps:
Filing of Lawsuit: The lender initiates the judicial foreclosure process by filing a lawsuit against the borrower in a California court. The borrower is served with a summons and complaint, and they have the opportunity to respond.
Court Judgment: If the borrower does not respond or loses the case, the court issues a judgment in favor of the lender, including the total amount owed and permission for the lender to sell the property.
Sale of the Property: The property is then sold at a public auction. The highest bidder takes ownership, often needing to pay in cash on the spot.
Right of Redemption: In a judicial foreclosure, the borrower has a statutory right of redemption, allowing them to reclaim their property within a certain period post-sale by paying the total sale price plus additional costs.
Eviction: If the property is sold and the previous owner does not exercise their right of redemption, the new owner can start eviction proceedings to remove the former owner from the property.
Understanding the judicial foreclosure process helps homeowners and real estate professionals to navigate these complex proceedings better.
V. Foreclosure Timeline in California
In California, the foreclosure timeline can vary greatly depending on whether it's a non-judicial or judicial foreclosure. I’m going to break down each process to provide an estimated timeline.
Non-Judicial Foreclosure Timeline: The non-judicial foreclosure process can take approximately 120 days. It begins with a Notice of Default, recorded after a borrower defaults on their mortgage payment. The borrower has roughly three months (90 days) to pay the overdue amount. If the borrower cannot rectify the situation within these 90 days, the lender will record a Notice of Trustee's Sale. The property can be auctioned 21 days after the Notice of Trustee's Sale is recorded. However, remember that many lenders delay the process, and it could take several months to a year or longer from the initial default.
Judicial Foreclosure Timeline: A judicial foreclosure is typically much longer than a non-judicial foreclosure, often taking more than a year. The process begins with the lender filing a lawsuit, and the timeline then depends on court schedules and the length of time it takes to serve the borrower. If the court rules in favor of the lender, the property is sold at a public auction. Following the sale, the borrower has a right of redemption that may last one year, during which they can pay the total amount owed to reclaim their property.
Factors Affecting the Foreclosure Timeline: Several factors can lengthen the foreclosure timeline, including:
Legal Challenges: If a borrower contests the foreclosure, the process can be delayed significantly, particularly in the case of a judicial foreclosure.
Lender's Discretion: Lenders often have a backlog of foreclosures and might wait to immediately file a Notice of Default after a borrower misses several payments.
Loan Modification or Short Sale: If the borrower works with the lender to modify the loan or sell the property via a short sale, the lender may delay the foreclosure process.
Understanding the typical timelines and potential delays can assist homeowners and real estate professionals to navigate and plan accordingly during a foreclosure.
VI. Borrower's Rights and Protections
In California, borrowers have several rights and protections when facing foreclosure. Importantly, they have the right to be notified appropriately at every step of the foreclosure process, ensuring ample time to react or challenge the process. Additionally, they can attend and participate in the foreclosure sale. If a judicial foreclosure process is followed, borrowers have a statutory 'right of redemption,' allowing them to reclaim their property after the foreclosure sale.
Facing foreclosure is a challenging ordeal, but there are alternatives to explore:
Loan Modifications: Borrowers can negotiate with their lender to modify their loan terms, possibly reducing the monthly payments to a more manageable amount.
Short Sales: If the home's market value is less than the outstanding mortgage balance, borrowers can work with the lender to sell the house at a price lower than the balance due and forgive the remaining debt.
Deeds in lieu of foreclosure: As a last resort, borrowers can voluntarily transfer property ownership to the lender to satisfy the loan and avoid foreclosure.
Exercising these rights and options can help homeowners navigate the tricky waters of foreclosure, potentially avoiding it altogether. Knowledge is power; knowing your rights and options can make a significant difference when dealing with a possible foreclosure.
VII. Impact of Foreclosure
A foreclosure can have long-lasting impacts on a homeowner's financial situation and the community. For the homeowner, foreclosure negatively affects their credit score, making it more challenging to secure loans in the future. The foreclosure remains on the credit report for seven years and could lower the score by 85 to 160 points, according to Equifax. Furthermore, the ability to purchase a new home is affected; generally, a borrower must wait a while after a foreclosure to qualify for a new conventional mortgage.
The impacts extend beyond individual homeowners to the community and real estate market. Foreclosures can lead to decreased property values in the surrounding area, mainly if multiple foreclosures exist in the same neighborhood. The property often sits vacant for a time, potentially leading to neglect and disrepair. These circumstances can destabilize communities and reduce the area's appeal to potential buyers.
While the impacts of foreclosure are severe, awareness of these consequences can motivate homeowners to seek help early in the foreclosure process and explore options to avoid it.
Navigating the choppy waters of foreclosure can be overwhelming, but having a comprehensive understanding of the process can make the journey more manageable. I’ve discussed the California foreclosure process, explaining both non-judicial and judicial foreclosures and highlighting the vital legal framework in California that guides these processes. You also know about the typical timelines and potential delays and the rights and protections available to borrowers, including alternatives such as loan modifications, short sales, and deeds in lieu of foreclosure.
Remember, foreclosure can significantly impact a homeowner's credit, future homeownership opportunities, and the broader community and real estate market. Thus, it's essential to explore all options to mitigate these impacts.
Facing foreclosure is a complex process filled with legal intricacies, and every situation is unique. That's why seeking professional advice is essential when dealing with a potential foreclosure. Real estate professionals, credit counselors, and legal advisors can provide invaluable assistance, helping homeowners understand their options and make informed decisions.
Foreclosure is a challenging road, but with knowledge and the right support, homeowners can navigate this process more confidently, potentially finding alternatives to alleviate the situation.
As always, if you are interested in getting your real estate license, visit www.adhischools.com or call us at 888-768-5285.
Love,
Kartik
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Entering the world of real estate can feel like learning a new language. As in any industry, real estate comes with its unique terminology, which can be daunting for those new to the field. But fear Read more...
Entering the world of real estate can feel like learning a new language. As in any industry, real estate comes with its unique terminology, which can be daunting for those new to the field. But fear not; mastering this language is not only possible but also a critical component of becoming a..
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Entering the world of real estate as a professional can be both exciting and daunting. The dynamic landscape offers numerous possibilities, but the thought of choosing a broker can be daunting. There Read more...
Entering the world of real estate as a professional can be both exciting and daunting. The dynamic landscape offers numerous possibilities, but the thought of choosing a broker can be daunting. There are so many choices out there ranging from a team structure, to an independent company or even a national franchise - there are no shortage of options.
When it comes to commission splits, the 100% commission model stands out for its distinct structure and potential benefits among the available options. This model promises an attractive deal: the agent takes home their entire commission, hence the name '100% commission'. But like any other model, there are pros and cons.
As many of our readers are either enrolled in real estate license school or considering enrolling in license school I wanted to explore the nuances of 100% commission brokerages and assess whether it's the right choice for new professionals aiming to make their mark in our great real estate business.
In theory, a 100% commission brokerage allows agents to keep all their commission from a transaction. In other words, when an agent working under this model closes a deal, they retain the entire commission, hence the term '100% commission'. It’s important to read the fine print before joining such a company, however as sometimes “100%” isn’t really “100%”. Although some brokers may brand their compensation plans “100%” they can involve a nominal flat fee per transaction or a monthly or annual fee that the agent pays the brokerage rather than a commission percentage.
This starkly contrasts the traditional brokerage model, where an agent's commission is split between the agent and the brokerage. In a traditional model, the split is often a fixed percentage. It may range from a 50/50 split to a 90/10 split, depending on the agent's experience level, the brokerage's policies, and market standards. In a traditional brokerage model, the agent could take home anywhere from 50% to 90% of the commission from a transaction.
A simple example can illustrate the difference. If an agent closes a deal that generates a gross commission income (GCI) of $20,000 in a 100% commission model, the agent could keep the entire $20,000 (minus any flat fees or other costs associated with the brokerage). However, in a traditional 70/30 split model, the agent might take home let’s say $14,000, with the remaining $6,000 going to the brokerage.
This might seem like a no-brainer for the agent, but like anything there are pros and cons for the real estate professional in an environment like this.
The Downside of 100% Commission Brokerages
While 100% commission brokerages have gained traction for their potential benefits, they're not without their pitfalls. It's crucial to weigh these cons against the pros when deciding whether this model is right for you. Here, we'll explore some potential downsides of working with a 100% commission brokerage.
1. Lack of Support
One common criticism of 100% commission brokerages is the perceived lack of support. In traditional brokerages, part of the commission split often goes toward administrative support, training, and office resources. These brokerages might provide agents with access to a physical office, marketing materials, continued education, and more. In contrast, 100% commission brokerages typically operate on a leaner model, and you might find yourself largely on your own.
2. Hidden Costs
While keeping 100% of your commission can sound appealing, it's crucial to remember that this figure might only account for some costs. Some 100% commission brokerages charge a transaction fee per sale or even recurring monthly or annual fees. You should also account for costs related to errors and omissions insurance, marketing materials, and other business-related expenses. Therefore, it's essential to factor these into your calculations when determining potential earnings.
3. Less Structured Environment
The increased autonomy that comes with a 100% commission brokerage can be a double-edged sword. For some, this independence is liberating; for others, a less structured environment might lead to reduced motivation and productivity. Some agents may need the structure and community of a traditional office setting to stay focused and motivated.
4. Not Ideal for Newer Agents
Although the flat-fee model can be attractive to new agents from a financial perspective, the lack of support and guidance can make it a challenging environment for those just starting out. New agents often benefit from mentorship, training, and hands-on support to help them navigate the industry's complexities after they pass the real estate exam. With these resources, newer agents may find it easier to succeed.
5. Misleading "100% Commission" Terminology
Finally, it's worth noting that the term "100% commission" can be somewhat misleading. As noted earlier, this model's various fees and costs mean that agents rarely take home the full 100% of their commission. Understanding this can help manage expectations and make a more informed decision about whether this model is the right fit.
While the 100% commission model can offer significant benefits, it's essential to consider its potential downsides. Whether you're a seasoned pro or a newcomer to the industry, understanding these cons will help you decide and choose a brokerage model that aligns with your career goals and working style.
The Upside of 100% Commission Brokerages
In the fast-evolving real estate landscape, alternative brokerage models have begun to challenge traditional business methods. Let's talk about the promising upside of this model, as it holds potential to revolutionize an agent's income and autonomy in their real estate journey.
1. Greater Income Potential
The most obvious advantage of the 100% commission model is the potential for higher income. Agents can maximize their earnings from every transaction by keeping the entire commission minus a nominal flat fee. This approach can be incredibly lucrative for high-performing agents who complete many transactions.
2. Predictability and Transparency
One of the often-overlooked benefits of the 100% commission model is its simplicity. With a fixed fee structure, agents know upfront what their expenses will be, making it easier to budget and plan for the future. This clear-cut approach provides a sense of predictability and transparency that can be comforting in an industry often characterized by uncertainty.
3. Flexibility and Control
100% commission brokerages give agents more autonomy and control over their business. This independence allows agents to be more innovative with their marketing strategies and business plans, adjusting as they see fit without additional brokerage interference. This flexibility can lead to more effective personal branding and, consequently, better business growth.
4. Competitive Service Offering
Lastly, the 100% commission model allows agents to offer their clients competitive pricing in a crowded marketplace, possibly attracting more clients and driving more business.
Is the 100% Commission Model Right for a Newer Real Estate Agent?
Navigating the world of real estate can be complex for a novice agent, fresh from our real estate school. For new real estate professionals, the 100% commission model might seem appealing on the surface, but it's essential to understand what this model entails and if it truly aligns with your needs and career goals.
As mentioned earlier, 100% commission brokerages offer the allure of significant earning potential, allowing agents to retain the majority, if not all, of their commission. This can be especially enticing for those who are just starting and are keen on maximizing their income.
However, the primary challenge for newer agents under this model is more support and mentorship. Traditional brokerages often provide comprehensive training and resources that are beneficial for agents building their skills after passing the real estate exam. These resources can include hands-on training, marketing assistance, and access to experienced agents who can provide guidance and advice. The absence of these support structures in many 100% commission brokerages can make the initial stages of a real estate career more challenging for newer agents.
Furthermore, while the potential to earn 100% commission can be attractive, new agents need to remember that various expenses, such as transaction fees, marketing costs, and insurance often offset this. These expenses can add up and put financial pressure on agents, particularly those who are still trying to establish themselves in the industry and secure consistent transactions.
There is also the aspect of self-discipline and motivation. The high level of autonomy in a 100% commission model requires a substantial amount of self-direction. With the structured environment provided by traditional brokerages, some new agents might be able to maintain their momentum, especially during challenging periods.
So while the 100% commission model can offer greater income potential, it comes with challenges that may prove difficult for newer agents to navigate. It's vital for new agents to consider these factors and seek out a mentor or network of experienced agents for guidance. As with any career decision, it's all about finding the right fit for your goals, working style, and needs.
Becoming a real estate professional is filled with many decisions, and choosing the right brokerage model is an important decision. It's critical to remember that there is no one-size-fits-all solution - each model has its own unique characteristics and considerations. The 100% commission model, with its allure of potentially higher earnings and autonomy, is no exception.
It offers numerous advantages, including greater income potential, predictable and transparent fee structures, and more control over one's business. These benefits can be particularly appealing for seasoned agents with a solid client base and comfortable navigating the industry independently. For them, this model can be a financially rewarding alternative to the traditional commission split model.
As discussed, this model also has its challenges. The often-overlooked costs and the absence of supportive resources can pose hurdles, particularly for newer agents just starting their journey after real estate school. The lack of structured environment poses a challenge to maintaining motivation and discipline, crucial components for success in this industry.
Moreover, the decision should not be based solely on financial considerations. Agents, particularly those new to the industry, should also consider the level of support, mentorship, and resources they may need as they build their skills and client base. In this aspect, the traditional brokerage model with its training programs and support structures can often be more suitable for newly minted agents aiming to make their mark in the industry.
Ultimately, whether the 100% commission model is the right fit will depend on the individual agent's career goals, personal work style, and needs. It's critical to weigh the potential income benefits against the need for support, training, and resources. Agents considering this model should fully understand what it entails, assess their own needs and abilities, and seek advice from experienced professionals in the industry.
This decision marks one of the many milestones in the exciting journey of becoming a real estate professional. Choose wisely, as the right brokerage can pave the way for a rewarding and successful career in real estate - or not.
As always, if you are considering taking real estate license courses with us, visit www.adhischools.com or call us at 888-768-5285.
Love,
Kartik
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A foreclosed home is a property repossessed by a lender, typically a bank, due to the homeowner's inability to meet their mortgage obligations. When a borrower fails to make timely mortgage payments, Read more...
A foreclosed home is a property repossessed by a lender, typically a bank, due to the homeowner's inability to meet their mortgage obligations. When a borrower fails to make timely mortgage payments, the le
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