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This book is a pragmatic and creative approach to legal and asset protection issues faced by investors in Texas real estate, particularly investors in residential and smaller commercial properties

Sujets

Property law

Informations

Publié par	First Edition Design Publishing
Date de parution	15 avril 2014
Nombre de lectures	0
EAN13	9781622874583
Langue	English

Informations légales : prix de location à la page 0,0600€. Cette information est donnée uniquement à titre indicatif conformément à la législation en vigueur.

Extrait

Real Estate Law & Asset Protection For Texas Real Estate Investors, Second Edition
David J. Willis, J.D., LL.M.

First Edition Design Publishing
R EAL E STATE L AW
&
A SSET P ROTECTION
For Texas Real Estate Investors

Second Edition

By David J. Willis, J.D., LL.M.

First Edition Design Publishing
Sarasota, Florida
Real Estate Law & Asset Protection
For Texas Real Estate Investors
Second Edition
Copyright ©2014 David J. Willis

ISBN 978-1622874-57-6 PRINT
ISBN 978-1622-874-58-3 EBOOK

LCCN 20133949130

March 2014

Published and Distributed by
First Edition Design Publishing, Inc.
P.O. Box 20217, Sarasota, FL 34276-3217
www.firsteditiondesignpublishing.com

ALL R I G H T S R E S E R V E D. No p a r t o f t h i s b oo k pub li ca t i o n m a y b e r e p r o du ce d, s t o r e d i n a r e t r i e v a l s y s t e m , o r t r a n s mit t e d i n a ny f o r m o r by a ny m e a ns ─ e l e c t r o n i c , m e c h a n i c a l , p h o t o - c o p y , r ec o r d i n g, or a ny o t h e r ─ e x ce pt b r i e f qu ot a t i o n i n r e v i e w s , w i t h o ut t h e p r i o r p e r mi ss i on o f t h e a u t h o r or publisher .
CONTRACTS & CLOSINGS
Chapter 1
RESIDENTIAL SALES CONTRACTS
Chapter 2
SELLER DISCLOSURE
Chapter 3
TITLE INSURANCE
Chapter 4
EARNEST MONEY DISPUTES IN RESIDENTIAL TRANSACTIONS
Chapter 5
AFFIDAVITS OF HEIRSHIP
Chapter 6
LIS PENDENS
OWNERSHIP & TRANSFER OF TEXAS REAL ESTATE
Chapter 7
CO-OWNERSHIP OF PROPERTY
Chapter 8
DEEDS IN TEXAS
Chapter 9
DEEDING PROPERTY TO AN LLC
Chapter 10
DEEDING PROPERTY TO THE LENDER
NOTEWORTHY STATE & FEDERAL LAW
Chapter 11
EXECUTORY CONTRACTS IN TEXAS REAL ESTATE
Chapter 12
THE STATUTE OF FRAUDS
Chapter 13
MORTGAGE LOAN FRAUD
Chapter 14
SAFE ACT AND DODD-FRANK
Chapter 15
HIGHER-PRICED MORTGAGE LOANS
CREATIVE TRANSACTIONS
Chapter 16
LEASE-OPTIONS, LEASE-PURCHASES, AND RIGHTS OF FIRST REFUSAL
Chapter 17
WRAPAROUND TRANSACTIONS
Chapter 18
“SUBJECT TO” TRANSACTIONS
Chapter 19
ASSUMPTIONS
Chapter 20
DUE-ON-SALE
Chapter 21
LAND TRUSTS
Chapter 22
LIVING TRUSTS FOR THE HOMESTEAD
Chapter 23
ADVERSE POSSESSION
ASSET PROTECTION STRUCTURING
Chapter 24
LLC FORMATION
Chapter 25
LLC GOVERNING DOCUMENTS
Chapter 26
THE SERIES LLC
Chapter 27
LLCs: A BRIEF TAX INTRODUCTION
Chapter 28
PIERCING THE VEIL OF AN LLC
Chapter 29
JOINT VENTURES
Chapter 30
BUYING OR SELLING YOUR LLC
ASSET PROTECTION STRATEGIES
Chapter 31
ASSET PROTECTION IN TEXAS
Chapter 32
ANONYMITY IN TEXAS REAL ESTATE
Chapter 33
ASSUMED NAMES
Chapter 34
HOMESTEAD PROTECTIONS IN TEXAS
Chapter 35
LIEN REMOVAL
Chapter 36
EQUITY STRIPPING FOR ASSET PROTECTION
Chapter 37
FRAUDULENT TRANSFERS
EVICTIONS, FORECLOSURE, & LITIGATION
Chapter 38
EVICTIONS
Chapter 39
FORECLOSURES
Chapter 40
TEXAS LITIGATION
Chapter 41
MEDIATION
Chapter 42
JUDGMENTS IN TEXAS
Chapter 43
CHARGING ORDERS
OTHER ISSUES OF INTEREST TO INVESTORS
Chapter 44
REDEMPTION ISSUES FOR INVESTORS
Chapter 45
SECURITY DEPOSITS IN TEXAS RESIDENTIAL LEASES
PREFACE

This book is a pragmatic and creative approach to legal and asset protection issues faced by investors in Texas real estate, particularly investors in residential and smaller commercial properties. If you are a real estate investor who owns (or aspires to own) 10, 20, or 50 or more properties, then you should consider reading this book. If you use creative methods such as wraparounds and “subject to” transactions then you may find this volume very useful indeed. If, however, your goal is to assemble an international consortium to purchase Rockefeller Center or Trump Tower, then this is probably not the book for you.
It is not my intention to offer a textbook or comprehensive academic treatise. Rather, this volume contains practical perspectives and techniques developed over the years in the course of advising and representing investors, both in transactions and in the courtroom. Since there are usually as many opinions as there are lawyers in a room, it should be no surprise if other lawyers disagree with at least some of my conclusions. In response, I would point out that there is nothing theoretical presented here. Every strategy I describe has been tried and has succeeded in the real world. Having said that, readers should consult an attorney prior to implementing any of my suggestions in order to insure compatibility with individual circumstances. Business plans vary and so do investments and asset protection strategies. Note also that the law changes and evolves, often rapidly. While cases and statutes are cited in this book, the reader should do independent research to ascertain the current status of the law before relying on any of these citations. I do not offer legal guidance to any particular person with regard to any particular case.
As you consult this book, I suggest that you make sure you have the latest edition. You can check on this by going to our website, www.LoneStarLandLaw.com.
All real estate investors should form the habit of doing thorough due diligence prior to investing in real estate. This includes consulting attorneys, accountants, insurance advisors, and other qualified professionals on overall methods and goals as well as specific transactions. Every investor should have a team of seasoned professionals available to answer questions, offer input, and provide customized services. A professional investor will also acquire a basic

level of competence in searching and obtaining information and copies from real property and appraisal district records.

On the subject of transactional documentation, I urge readers to avoid most standard forms, especially those obtained from the Internet, except for contracts and addenda promulgated by the Texas Real Estate Commission and the Texas Association of Realtors. Consider others suspect.
There are many resources for investors, not the least of which is the Texas Property Code. I suggest that every investor have a paperback copy of the Code on his or her desk and refer to it regularly (go to www.JonesMcClure.com). There are also a number of quality educational opportunities in the marketplace, including real estate schools and mentorship programs, enough so that there is no excuse for an investor not to master the trade.
Lastly, it has been my experience that good ethics make for good business. Avoid any transaction that even hints of fraud or deception. If it appears too good to be true it probably is.
I welcome comments and criticism. I can most easily be reached by email at LoneStarLandLaw@aol.com.
David J.Willis
CONTRACTS & CLOSINGS
Chapter 1
RESIDENTIAL SALES CONTRACTS
The TREC One to Four Family Residential Contract

The most commonly used residential sales contract in Texas is the One to Four Family Residential Contract (Resale) promulgated by the Texas Real Estate Commission as form number 20-11. The blank form is available at www.trec.state.tx.us. I will refer to it as the “TREC 1-4 contract.” All licensed brokers and agents are required to use this contract and other TREC promulgated forms when representing clients in the purchase and sale of real property. Non-licensees and attorneys may use any format they wish.
Real estate investors will find that they are almost always better off using the TREC 1-4 contract with appropriate addenda rather than anything simpler that is supposedly designed or streamlined for investor use. This is true even though TREC forms are generally intended to be neutral one-size-fits-all documents. Accordingly, an experienced investor will become familiar with the various options and boxes to be checked in TREC forms and learn how to tailor a contract to his or her advantage.
The truth is, even when amicably conducted, the sale and purchase of real estate is by definition an adversarial transaction. From a lawyer’s perspective, producing a contract and closing documents that advance the client’s best interests is the whole point of the exercise.

Strike-Outs versus an Addendum
How should revision of the TREC 1-4 contract be accomplished? One way is to make changes on the form itself—strike, insert, and initial with pen. This is legally valid although it can get messy if there are lots of alterations. It is often cleaner to attach a special provisions addendum that supersedes any printed form provisions that may conflict. Only items to be altered are mentioned in the addendum. This method of modifying the contract has an obvious advantage in negotiations: It is immediately apparent to everyone which terms are being changed and which are not.
Another advantage to the addendum method is that brokers and agents are more comfortable with it, since the actual body of their familiar TREC contract has not been changed. Custom, non-standard contracts tend to push licensees out of their comfort zone, at least in the residential arena. Custom contracts are much more common in commercial transactions.
If your choice is to add a special provisions addendum, the wording “See Special Provisions Addendum attached hereto and incorporated herein” should be inserted in paragraph 11 (Special Provisions) of the TREC 1-4 contract. Also, in paragraph 22 (Agreement of Parties), the box “other” should be checked and “Special Provisions Addendum” inserted in the line that follows.
A further note as to paragraph 11 (Special Provisions): it is a blank space available for inserting extra comments, but its permitted use by brokers and agents is limited to “factual statements and business details applicable to the sale”—i.e., not modification of text or addition of provisions that are primarily legal in nature. It is therefore not the appropriate place to insert provisions that have legal implications, nor is it an acceptable substitute for a special provisions ad