Selling Your House? Working From Home May Impact Buyer Preferences

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Appealing to work-from-home buyers can boost your home’s profile. How much? To get an idea of the value placed on the work-from-home economy today, note that Apple, in September 2020, introduced its holiday subscription sets of TV shows, games, news, music and home workouts — all designed to cater to the work-at-home set.

The office has shifted, and the work-from-home life is here to stay. With that in mind, let’s look at what work-from-home buyers are seeking in a home itself, and how a seller can use this knowledge advantageously.

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Co-Owning Property With a Non-U.S. Citizen? Keep These Points in Mind

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Whether you plan to co-own property with a United States citizen or a non-U.S. citizen, the rules of the game aren’t too different. Noncitizens can inherit property. They may be named as beneficiaries on financial and insurance accounts, just as citizens may. And whether you own jointly with citizen or resident, you’ll each qualify for the current annual gift tax exclusion.

You’ll also qualify for the current estate tax exemption if you’re under the cap. Specifically, there is no estate tax on the wealth of people who pass away with (as of 2020) less than $11.58 million (twice that amount per couple). The non-U.S. citizen spouse can inherit up to the annual cap without owing federal estate tax. (This attractively high estate tax exemption could expire within the next few years.)

Now, those basics aside, here are a few special property ownership rules and tax provisions worthy of note. 

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Notaries Had Enough Trouble in 2020. Then Indiana Botched a Notary Law Update.

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What happened July 1, 2020, when the Indiana Senate tweaked Indiana Code § 32-21-2-3?

Previously, that provision of Indiana law said any conveyance, mortgage or other document to be recorded must simply have the signer acknowledge the document with a notary. Or the document could be proved with a notary and an additional witness. The key term is or — you needed either one or the other. Now, that section of the code has the word and instead of or.

Little words, big problems.

It was “an unintentional drafting error,” wrote Bill Anderson, Government Affairs VP for the National Notary Association, “with potential consequences for notaries in every U.S. jurisdiction.”

So, two different notarizations — an acknowledgement and a proof with a witness — must accompany any paper or electronic instrument submitted for recording. You can see samples of both notarial formats here.

As Indiana senators will henceforth never forget, the tiniest word change in a law’s language matters. The statute is slated to be amended and corrected when Indiana’s General Assembly reconvenes in 2021.

Meanwhile…

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LGBT+ and Real Estate Ownership

Navigating Mortgages, Titles and Deeds

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Co-buying a home as a couple signifies a serious commitment on multiple levels. If you have spoken with your real estate lawyer and financial expert, and decided to buy property together as a couple, congrats! You’ll want to make informed decisions about financing and titling your property together. You’ll be forging an estate plan as you go — because the way ownership is vested on the title tells the world what should happen with your property ownership even beyond your life.

It’s good to know that the language of the chain of title can co-exist with respect for the homeowners’ sexual identity. Even so, certain things will be on LGBTIQ home buyers’ radar. Here, we outline some frequently noted issues, to help orient your conversations with your financial and legal advisers, and your mortgage and title professionals.

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The Tax Lien Cometh

Back Taxes Can Impact Your Real Estate Title. Here’s How to Deal With Them.

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What happens when a taxpayer doesn’t pay tax? If the Internal Revenue Service is slighted, it follows its age-old tradition and imposes a tax lien on the person’s property. Boats, financial accounts, the house — an IRS lien attaches to everything. And federal tax liens are resilient; they can even stay on the title through a homeowner’s bankruptcy, if they were imposed before the bankruptcy was filed.

With the lien, the government isn’t actually taking the property. But if the homeowner wants to sell the property, the government will take its cut from the sale proceeds.

Concerned you might have a lien? You can check with the recorder of deeds in the county where your home is, or review your debt records on the IRS website. If you find yourself dealing with back taxes, find a way to make good on the tax bill, or get the relief you need.

Here, we delve into the most frequently asked questions about the impact of a lien on a taxpayer’s home title, and steps the homeowner can take to keep that title clean.

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Natural (and Other) Disasters: How Emergencies Impact Titles & Mortgages

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As a general rule, real estate values have risen through the decades. Today, a force is challenging that rule, and we all need to know about it before heading for the closing table. It involves the risk of weather damage and disasters.  

Emergencies are affecting more real estate as the years go on. Whether a catastrophe is defined as natural, human-driven, or both — as with today’s storm surges and floods — it can lead to default on mortgages or deeds of trust. Here, we look at the risks, industry responses, and how homeowners can protect the value of their titles.

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Ready for Sole Homeownership? What Single Buyers Need to Know

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Married couples still make up the bulk of U.S. home buyers. Yet single buyers make up a good portion, too. Some are going solo on account of divorce or a loss of a former life partner. Some, happily independent, are making a commitment to a place for years into the future. And some just want to put apartment living in the rear-view mirror.   

Solo buying can be thrilling and daunting at the same time. The first goal is confidence in the loan approval process. Some solo home shoppers wonder if they’re ever going to succeed in bidding, given the buying power of dual-income couples looking in the same area. For many, the burning question is: What if I’m mentally ready to buy, but maybe not making the kind of money today’s mortgage lenders expect?

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HELOC: How Home Equity Lines of Credit Impact a Home’s Title

Image of a tipped over glass jar of coins captioned: How Home Equity Lines of Credit Impact a Home's Title

Home buying is a wealth-building strategy, as well as a way to own a living space. As a homeowner pays off the mortgage over the years, the home becomes a store of value. That equity can be useful for making renovations or pursuing new business investments.

A home equity line of credit, abbreviated as HELOC, enables homeowners to reach and use the value they’ve accumulated in their homes. An owner might tap into their home equity to increase the value of the home still further. The interest on a HELOC can be a tax deduction, if the reason for taking out the loan is to improve the real estate’s value.

The owner pays a small annual fee, say $50, in exchange for this ability to borrow against the equity. The percentage of equity the lender might approve for the account could be as much as 85% of the home’s value — minus the current mortgage debt.

So, just like an original mortgage, a HELOC allows the homeowner borrow against the value of the real estate asset. Given that the HELOC collateral is the home, the homeowner will want to steer clear of any activity that could make it more of a stretch to repay the loan, raising the risk of losing the house to the lender.

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Is the Recovery Real? Real Estate in the Summer of Covid-19

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In early March, the pandemic placed U.S. real estate transactions on hold. A few weeks later, Realtor.com created its weekly Housing Recovery Index, to track changes since Covid-19 gained a foothold. The name of the index itself suggests confidence in the market’s rebound.

According to the recovery index, home sales took a turn upward in May. Traditionally, we’d expect a May home sales boost for real estate markets across the United States — the time when homes sell more quickly than in any other month, and command the highest prices. What about June? The buyer interest continued, as noted in a widely cited, upbeat report from the U.S. Commerce Department that focused on a rally in new home sales. Still, it wasn’t a normal June. The rally has included an unusual kind of impetus: a desire for migration from cities to suburbs, as people seek shelter from the virus.

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