Naperville real estate lawyersThe real estate investment industry can be lucrative for the financially savvy, but it can also ruin investors that refuse to do their homework. Furthermore, there are several potential pitfalls that one must avoid when first entering the industry. Learn how to avoid them, and discover how an experienced real estate lawyer can assist with the transaction on your next investment home purchase.

Condition of the Property

While some investment properties may have little to no damage, others may have serious issues. These properties, which are often referred to as distressed properties, can give you more return on your investment (ROI), but only if you are realistic about the time and money it will take to make the necessary repairs. It is also critical that you consider what repairs must be made before anyone moves in since you will not be collecting rent at that time.

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Posted on in Foreclosure

short sale, avoiding foreclosure, Naperville real estate attorneyWhen a homeowner falls behind on his or her mortgage payments, the situation can seem very dire. Foreclosure becomes a real possibility, and the uncertainty regarding the future may cause significant stress and concern for the family. Despite their best efforts, many homeowners may find it impossible to catch up on missed payments, leaving them searching for workable solutions. For some, a short sale may provide the opportunity to minimize the impact on an individual's financial well-being and future.

A short sale occurs when a lender agrees to accept a payoff amount less than the amount owned by the homeowner, so that the property may be sold. By agreeing to accept less, the lending institution forgives the remaining balance on the mortgage, but often results in significant damage to the homeowner's credit rating.

While finding a buyer for a short sale may be relatively easy, since the price of the property is likely to be lower than comparable property in a similar neighborhood, convincing the lender to agree to the sale is often much more difficult. A seller must be prepared to provide the lender with appropriate justification for the sale and doing so includes several components.

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Posted on in Foreclosure
Condos Not Included in Positive Real Estate Growth

Most housing news coming out of the Chicago area has been positive as of late, and the Chicago area housing market has indeed experienced a healthy recovery process since the economic downturn of 2008. Yet according to the Chicago Tribune, as reported by a Cook County home price index developed by DePaul University, the housing recovery process varies greatly “depending on property type and when it was purchased.” The index reports that while prices for larger multi-family buildings in Cook County have jumped “nearly 31 percent year-over-year for the quarter that ended in June,” there has been no such growth rate for condos, single-family homes, and two-to-four apartment buildings.

Condominiums in the Chicago area have experienced the lowest rate of growth during the housing recovery, down a whopping 11 percent, to put them on par with pre-1997 pricing levels. Single-family homes were actually down 2.6 percent compared with June 2011. Cook County Housing Institute Executive Director Geoff Smith told the Tribune that the data reveals that, “a person who bought their condo or single-family home in 2007 at the peak of the market, they are likely underwater.” The data could also reveal that many people who are buying are investors looking to rent out multi-family homes, not young families taking advantage of the low market and the First Time Homebuyer Credit.

Two-to-four unit buildings, many of which are owner-occupied, according to the Tribune, and many of which are located in low-income neighborhoods that were hit heavily by foreclosures, aren’t showing positive growth signs yet either, but the most stagnant segment of the market are condos. Zeke Morris, president of the Chicago Association of Realtors, “attributes the poor showing for condos to buildings with defaults or restrictive policies that are hampering owner's abilities to sell their units.” And economists aren’t predicting a fast recovery any time soon.

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Homes for Sale

The month of October saw a record-breaking amount of houses being sold in Chicago. The last time as many houses were sold was back in October of 2006. Many professionals, such as University of Illinois economist Geoffrey J.D. Hewings, claim that this is due to low interest rates. Others have sensed that consumers have found that the real estate market has begun to stabilize. The effect of the old inventory of houses being taken off the market is that the prices for existing houses will rise.

The Illinois Association of Realtors reported that 8,326 single-family homes and condominiums were sold last month. The area that was surveyed includes nine counties around the city of Chicago. This was an 11% increase from the monthly sales in September. Even more remarkable, the recent sales in October were 44% higher than the same month last year.

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Distressed Homes

As the national economy is trying to bounce back, there are factors which make the real estate market in Chicago move at a slower pace. One of the factors was reported in a Chicago Tribune article about the sale of distressed homes and the subsequent effects. A distressed home is a property which is owned by the mortgagee and is being sold as a foreclosure for a much lower price than market value. This drags the prices of local property lower because one of the influences of market value is pricing in your neighborhood.

According to data provider CoreLogic, said that Chicago saw a decrease in home value of 2.5% in August from prices a year ago. To compare, the prices in July only fell 1.7% from the previous year. Overall the state of is not much better, seeing home price decreases of 2.3%. This amount ranks Illinois in the top 2 for home price depreciation across the United States. Rhode Island saw the highest decrease at 2.6%, while the closest three other states to Illinois were New Jersey, down 1.4%; Alabama, down 0.7%; and Connecticut, down 0.5%.

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From our offices in Naperville and Oak Brook, Lindell & Tessitore P.C. represents clients throughout Illinois including the areas of Plainfield, Oswego, Aurora, Lisle, Winfield, Wheaton, St. Charles, Geneva, Oakbrook Terrace, Elmhurst, Hinsdale, Burr Ridge, Batavia, Yorkville, Downers Grove, Warrenville, Woodridge, Lemont, Romeoville, Joliet, Bolingbrook, Mokena, New Lenox, Frankfort, Channahon, DuPage County, Will County, Lake County, Kendall County, Kane County, Cook County, and the greater Chicagoland area.