Utah Homestead Act

Utah Homestead Act

In certain states, homeowners can take advantage of what’s called a homestead exemption. Basically, a homestead exemption allows a homeowner to protect the value of her principal residence from creditors and property taxes. A homestead exemption also protects a surviving spouse when the other homeowner spouse dies. State homestead exemptions often have four features, including the well-known property-tax exemption on a portion of a home’s assessed value.

Property Taxes

A homeowner’s understanding when it comes to homesteading her property most often has to do with the property-tax exemption. Generally, this advantage of homesteading pertains to shielding a portion of a home’s value from property taxes. Often, a typical homesteading advantage is that it’ll exempt the first $25,000 to $75,000 of a home’s assessed value from all property taxes. With a $50,000 homesteading exemption, you’ll only owe property taxes on the home’s remaining assessed value.

Forced Sale Immunity

With a homestead exemption, your home is shielded from a forced sale to satisfy creditors. For example, the lender financing your automobile can’t force the sale of your home if you default on your auto loan. Before homestead exemptions, creditors could and often did try to seize a homeowner’s property to satisfy all kinds of debts. Homestead exemptions, however, don’t normally shield your home from forced sale in mortgage foreclosures or from defaulted property taxes.

Surviving Spouse Advantages

Utah’s homesteading laws work to protect the homestead interests of surviving spouses by guaranteeing their homesteading rights. State homestead laws vary, but surviving spouses under homestead laws retain the homestead right to their homes for life. For surviving spouses, as long as they use and occupy the homesteaded property, they won’t lose homestead rights. Surviving spouses on homesteaded properties, though, must make any mortgage and other payments due in order to retain their homesteading rights.

Homestead Requirements

In order to declare a homestead on your home, it must be your principal residence. In Utah, homestead exemptions apply only to real property. You won’t be able to declare your house boat or motor home a homestead under certain state’s homesteading laws. Your homestead exemption and its advantages last until you effectively abandon the homestead, too. Commonly, you abandon an old homestead when you declare another home your new homestead.

The Utah Homestead Exemption Amount

Under the Utah exemption system, homeowners may exempt up to $30,000 of their home or other property covered by the homestead exemption. You may use the homestead exemption to protect more than one parcel of land, but you may protect up to one acre only.

Doubling for Married Couples

If you file a joint bankruptcy with your spouse in Utah, you can double the homestead exemption to protect up to $60,000 in your home.

The Scope of the Utah Homestead Exemption

In Utah, the homestead exemption applies to real property, including your home or mobile home. You may also protect water rights that you own, if the water is used for domestic or irrigation purposes. In order to use the $30,000 exemption to protect your home, it must be your primary personal residence. Utah law permits you to protect property that is not your primary personal residence, but if you don’t live in the property, the exemption amount is limited to $5,000. The homestead exemption also applies to sale proceeds for up to one year after the property is sold.

Can You Use the Federal Bankruptcy Exemptions in Utah?

Some states allow bankruptcy filers to use the federal bankruptcy exemptions instead of the state exemptions. Utah is not one of those states. If you reside in Utah, you must use the state exemptions.

Homestead Declarations

In Utah, you must file a homestead declaration (a form filed with the county recorder’s office to put on record your right to a homestead exemption) in order to claim the homestead exemption. Contact your county recorder for information on how to file a homestead declaration. Refer to the Utah Code Section 78B-5-504 for the information you are required to include in your homestead declaration.

Other Information About the Utah Homestead Exemption

In Utah, you cannot use the homestead exemption to protect your property from debts due to property taxes or assessments, purchase (such as a mortgage), child support, or liens that you allowed against your property by mutual contract. Homestead exemptions work in two primary ways: flat-dollar exemptions or percentage exemptions.
A flat-dollar homestead exemption reduces the taxable value of your home by a set amount, like $25,000 or $50,000. This style of homestead exemption has a greater impact on people with lower-value homes, as a $50,000 exemption on a $150,000 home is a much greater percentage than the same exemption on a $500,000 home. Percentage exemptions, on the other hand, reduce the taxable value of a home by a certain percentage, like 15% or 40%. This has a bigger impact on homeowners with higher-value properties.

Homestead Tax Exemption Example

Homestead tax exemptions reduce the taxable value of your home, meaning you pay less to the government. Here’s how it works: If your home is worth $200,000, and your local property tax rate is 1%, then you’d normally owe $2,000. But if the homestead exemption is $25,000, then you’re taxed like your property is worth $175,000 meaning you owe just $1,750.

Who’s Eligible For A Homestead Mortgage Exemption?

Homestead exemptions are generally available only on primary residences, rather than second homes or investment properties. Some states offer their homestead exemption applications to all homeowners. Other states restrict their homestead tax exemptions to certain groups, or offer greater homestead exemptions to people in certain categories, such as:
• Elderly people
• People with disabilities
• Veterans, though often restricted to disabled veterans
• Disabled former law enforcement officers and first responders

Types Of Homestead Mortgage Exemptions

Here are a few examples of homestead mortgage exemptions in individual states. (Note: The exemptions listed below are typically not the only ones the state offers.)

The homestead exemption in Utah is included in the state constitution, allowing all homeowners to reduce the taxable value of their home by $7,000. The homestead exemption in New York is for veterans who have served in the U.S. armed forces and are homeowners. Depending on the type of service, several types of exemptions are offered. One of them, the Alternative Veterans Exemption, gives a 15% percentage exemption to veterans who served during a time of war, and is offered in more than 95% of the state’s cities and towns.

The homestead exemption in Texas, called the General Residence Homestead Exemption, allows homeowners to reduce the taxable value of their homes by $25,000 for school district taxes. The state’s Age 65 or Older or Disabled Persons exemption gives people in those categories an additional $10,000 exemption on the same taxes.

The homestead exemption in Florida allows homeowners to exempt up to $50,000 of the taxable value of their homes. The first $25,000 applies to all property taxes, which include school district taxes. Homeowners who have properties valued between $50,000 to $75,000 can deduct up to another $25,000 for non-school property taxes only. The state also exempts quadriplegic people and surviving spouses of first responders killed in the line of duty from all property taxes.
The West Virginia homestead tax exemption allows homeowners to exempt $20,000 in value from property taxes if they are age 65 or older or are permanently and completely disabled.

The Idaho homestead exemption allows people to exempt 50% of the taxable value of their home and up to one acre of land, for a maximum of $100,000 in exemption.

To get a homestead exemption, you typically have to apply for one, and every state has its own process. Typically, you’ll need to fill out a homestead exemption application with your county tax office. Many have application forms on their websites, which will ask you for the type of exemption you’re applying for and information about your property.

If you’re applying based on your age or a disability, you’ll likely have to provide documentation this can include:
• A birth certificate or government-issued identification (such as a driver’s license)
• Disability paperwork from a state or federal agency
• An affidavit from your physician

Homestead exemption applications are usually due by March or April of the year in which you intend to claim the exemption, though it could be as early as Dec. 31 of the year prior. Check with your county tax office. You may only need to file once, with the exemption renewing each year unless you move, but you should check your state’s rules to be sure.

Ways To Lower Your Mortgage Tax Bill

Owning a home can offer numerous tax benefits. If your state doesn’t offer a homestead mortgage exemption, or if you’re looking for other avenues to save money, here are a handful of ways to reduce your property tax bill:

• Appeal your tax assessment. Between 30% to 60% of the taxable properties in the U.S. are overvalued, according to the nonpartisan National Taxpayers Union Foundation. If you don’t agree with your valuation, file an appeal with your local tax authority.

• Deduct your mortgage interest payments. You’re allowed to deduct interest paid on up to $750,000 in home loans on your federal taxes, including the mortgage on your primary residence and a home equity loan or a line of credit used to buy, build or improve your primary residence or a second home.

• Deduct the value of your home office. If you’re self-employed, you may be able to deduct $5 per square foot of your home office on your taxes.

How To Start A Homestead

Moving from a typical modern lifestyle to being a homesteader is often a gradual process. You don’t have to sell everything and move to the country all at once. A lot of people have a romantic and idealized dream of what homesteading would be like.

Step 1: Consider What Homesteading Involves

You should really stop and think about what the day-to-day activities and chores will be like if you decide to become a homesteader. Taking care of crops and livestock, in particular, are time-consuming and physically demanding tasks, and not everyone is cut out for it. If you have a spouse or partner, you also need to make sure they’re 100% on board, and that homesteading is the kind of life that both of you are looking for. You’ll need to sit down and have open and honest discussions about what you’re looking for. If your partner hates the idea of getting their hands dirty, then living a homestead lifestyle will be very difficult for you. You should spend hours and hours learning everything you can about homesteading before you decide to make any kind of commitment. Don’t make a major homesteading decision without having all the facts and knowledge needed. Watch documentaries, read books and fully immerse yourself in the homestead mindset. If you’ve got friends or family who already have a homestead of their own, see if you can spend a few days helping out to get a feel for what the lifestyle is like. And be sure to ask them lots of questions.

Step 2: Set Goals For Yourself

If you followed Step 1 and realized that devoting yourself to taking care of a farm full-time isn’t for you, that’s totally okay. You can still practice homesteading and have a sustainable lifestyle without selling everything and moving to the country. Even in an urban setting you can start a vegetable garden, get a few backyard chickens and begin preserving your own food.

Step 3: Decide Where You Want To Live

Your goals in Step 2 will help decide what size of a property you’ll need. If you plan to have a full-time or part-time job still and just do homesteading as a hobby, then you can probably get by in an urban or semi-rural environment.
If you plan to make homesteading your full-time job and lifestyle, you’ll need enough room to grow all the vegetables and fruit that you need, plus space for cows, sheep, or any other livestock you want. In addition to figuring out how much land you need, you’ll also want to set parameters on the general area you want to live too.

Are you okay living in an ultra remote area, or do you want to be just outside of town? Make sure any land you look at will actually work for the type of homestead lifestyle you’re trying to accomplish. If you’re primarily looking to grow crops, then very sandy or rocky soil will make things more difficult, for example. Don’t forget to factor in travel time. Do you really want to drive 1.5 hours every time you need to pick up something from the grocery store, or go to work every day (if you’re still going to have a job?) Are you okay with the fact that it may take an hour for police or an ambulance to arrive in case of an emergency? Even little things like needing to take a long walk down to your mailbox each day, or driving to your nearest post office once a week, may be more than what you thought you were signing up for. Also avoid the temptation to bite off more than you can chew. You don’t need 100 acres, or even 10, to have the homestead of your dreams.

Some important homestead factors to keep in mind during the planning stage include:

• Water access. Do you have nearby lakes, rivers, or ponds that you can use for water? Is there a well on the property? How much rainfall does the area get per year?

• Land safety. You don’t want to live somewhere that’s prone to drought if you’re growing your own food, and you also don’t want to be near oil fracking sites or other potential health hazards.

• Community. Sometimes the community you’re a part of is just as important as the land you buy. You will need to make friends and network with people in your area. If they have different religious or political views than you, it might be more difficult to fit in with the community, especially in a small village.

• School. If you have kids, is there a school nearby? If not, you may need to home school them.

Step 4: Make A Budget

Having a thoroughly thought-out budget is critical for homesteading, particularly if you’re planning to give up a steady job to become completely self-sufficient. If you’re buying land and property, it’s important not to use all your savings to buy it. Otherwise you won’t have any money left for renovations, improvements, equipment, or other necessary things. If you are giving up a job for a more self-sufficient lifestyle, you’re going to need to think of some ideas to generate income for yourself.

At a bare minimum you’re still likely going to need to pay property taxes, and potentially utilities as well as things like a phone or internet bill. You’re also going to want to have some savings in case of an emergency, such as if your furnace breaks, or a family member gets sick. It’s smart to have multiple streams of income from your homestead. You may try selling wool, milk products, extra produce, as well as things like soap making or other crafts. That way if your crops all die or you find out there’s no demand for one income source, you have something else to fall back on. Obviously you don’t want to spread yourself too thin. But it’s not all that uncommon for homesteaders to have 5 or 10 different products or sources of income.

Step 5: Start Small

You don’t need to wait until you have your dream farm to begin. You can start your journey into homesteading right away. Much of homesteading is a mindset and lifestyle, as opposed to where you live. Whatever your situation is, even if you’re living in an apartment, you can start moving toward a more self-sufficient lifestyle this week. If you have a sunny window, you can start growing your own herbs or lettuce indoors. Got a large backyard that’s not being used to grow much besides grass and weeds? Put in a garden or raised bed next spring and start growing a portion of the vegetables for your household. (Be sure to pick vegetables that you actually enjoy and want to eat regularly!) Have a fireplace that you don’t currently use? Time to clean out your chimney and get some wood, and start using it to reduce your heating bill! Over time you can gradually add more and more projects. Even if you only make one or two small lifestyle changes per year, things will really start to add up over time. You could even start raising chickens or beekeeping in your backyard. Just be sure to check what your local bylaws are to make sure it’s allowed first!
Homesteading is all about what feels right for you. You can define your priorities and do things in whatever order makes the most sense to you. For some people, self-sufficient energy may be a priority so they may want to invest in solar panels right away. Other people may not mind paying for gas and electricity. Some people may want to start raising livestock right away for egg and meat production, while some people may choose to never go down that route due to ethical reasons.

Step 6: Continually Simplify Your Life

Homesteading often goes hand-in-hand with minimalism and living a more frugal lifestyle. A big part of that is getting out of the cycle of always needing the newest and greatest phones, gadgets, trendy clothing, and other things that can suck money out of your bank account but not really offer much value. For homesteaders, less is more, and there’s usually a cheaper and better way to do something. You should be continuously taking an audit of your life to see what things are draining your money, time, and energy, and seeing if you can reduce or completely eliminate them from your life. Adding homesteading to your lifestyle will often require taking some previous things out. Some things might be obvious. Other things may be more subtle and take more insight to figure out how to reduce or remove them from your life.

Step 7: Learn To Preserve Food

There are tons of different ways to preserve food, but the idea of food preservation in general is becoming a bit of a dying art. Even picking up one food preservation skill like canning, pickling, freezing, cold storage, dehydrating, or smoking can help cut down on your food costs. If you’re growing your own fruits and vegetables, then learning to preserve food is an absolute must. You’re likely going to have far more food at the end of the season than you know what to do with. And if you can’t preserve it, then most of it will end up going to waste. You’ll need to find a way to keep your produce from spoiling so that you can keep your family fed all throughout the winter months. Even if you don’t grow your own food, learning to preserve will allow you to buy food in season when it’s cheapest and most ripe, and continue eating it all year round. You probably know someone who has some extra canning supplies that you can borrow just to try it out. Even if you need to buy your own canning jars or a food dehydrator, they will often pay for themselves within the first one or two uses.

Starting to use cold storage is as easy as finding a cool, dark place in your basement or under your home where you can store things.

Step 8: Make Friends With Other Homesteaders

Homesteading is often associated with hermits or people who aren’t very sociable. But the truth is that many homesteaders are very friendly and eager to share what they know with anyone who’s interested. Having a homesteading buddy who is more experienced than you can really help if you have questions or concerns at any step along the way. They’ll know about the weather, growing conditions, laws, and lots of other useful information that you’ll need, because they’ve likely been through it all themselves already. And don’t discount having the moral support and someone who lives the same lifestyle as you being there, when everyone else is telling you that you’re crazy. Networking with other homesteaders makes sense from a material perspective too. If you’ve grown too many peppers and your friend has too many eggs, then it’s easy to barter for what you need. Or you might even set up long-term arrangements with other homesteaders to trade for food and supplies that you don’t necessarily want to produce yourself. You might only need a plow once per year at the start of the season, and it could make more sense to just borrow it from a neighbor as opposed to buying one for yourself.

Free Initial Consultation with a Real Estate Law Firm

It’s not a matter of if, it’s a matter of when. Legal problems come to everyone. Whether it’s your son who gets in a car wreck, your uncle who loses his job and needs to file for bankruptcy, your sister’s brother who’s getting divorced, or a grandparent that passes away without a will -all of us have legal issues and questions that arise. So when you have a law question, call Ascent Law for your free consultation (801) 676-5506. We want to help you!

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

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Troubled Real Estate Loans

Troubled Real Estate Loans

When a lender is working with a borrower to get a problem commercial loan resolved the loan typically goes to “workout”. When a commercial loan is criticized internally, when it’s out of covenant, or when the borrower fails to pay or pays late the loan will often go the workout department of a bank unless the bank uses a special servicer or, at really small banks, the workout is handled by the commercial loan officer on the line. Commercial loans can end up in the workout department if they are in monetary default or in technical default. A commercial loan can be considered to be non-performing whether it’s in monetary or technical default.

Technical Default vs Monetary Default

A monetary default occurs when the borrower is late on or does not make payments. A technical default occurs when the borrower violates other terms or covenants within the commercial note.
Typical technical defaults that will land a commercial loan in the workout department are:
• The value of the collateral (the property) and therefore the LTV (Loan to Value) dips below the prescribed percentage
• The owner fails to maintain the property as prescribed.
• Borrower fails to maintain insurance
• Borrower fails to pay taxes
• Borrower fails to submit financial statements on schedule (if required)
• Borrower fails to maintain liquidity or reserve ratios
• Borrower misallocates or mis-distributes profits
• A separate loan with the lender goes into default
The list goes on. And since commercial loans are between two businesses the borrower is expected to be more savvy and be more equipped than, say, a consumer. Therefore the terms and covenants in commercial loans are not regulated to the same degree as residential property loans and that means that the borrower should pay close attention to the covenants and be prepared to meet them lest she be caught blindsided by the workout department. Make no mistake the private lenders are much more flexible and creative in their workout strategies than traditional lenders are. Private lenders:
• Reduce principal
• Reduce interest rates
• Extend terms
• Modify the loan so its interest-only
• Accept a deed-in-lieu
Private lenders can do just about anything that’s legal and the borrower agrees to in their workouts. Banks and credit unions cannot, they’re regulated and those regulations dictate their workout options.

Commercial Loan Workouts at Banks

A commercial workout officer’s job is to collect what the bank is owed, in full, and make the bank “whole” on the loan. A good commercial workout officer knows about his assets, his borrowers, the local market and his vendors and uses all of those resources to collect. Depending on the size of the bank and the size of the loan a commercial workout officer may be very hands on or may direct the recovery and workout from behind a desk across the country. Because banks are regulated the rules and guidance around workouts varies significantly from those of private lenders.
Loan workout arrangements need to be designed to help ensure that the institution maximizes its recovery potential. Further, renewed or restructured loans to borrowers who have the ability to repay their debts under reasonable modified terms will not be subject to adverse classification solely because the value of the underlying collateral has declined to an amount that is less than the loan balance. So in short, if the borrower and guarantors of a distressed commercial real estate loan can write the check and you’d rather extend the loan, restructure the loan or what-have-you, the fact that the property is worth less than is owed is not the determining factor for whether or not the bank has to action on a CRE loan in technical default (default for reasons other than non-payment). It also say that bank’s must do whatever will allow them to maximize capital recovery (essentially).

Analyzing Repayment Capacity of the Borrower

Basically look at the whole borrower and the guarantors. If they have the ability to continue to pay and their future ability to pay is defensible then carry on.
Evaluating Guarantees
A good guarantor with a solid contract means you can keep reporting the loan is in good standing.
Assessing Collateral Values
A new appraisal may not be necessary in instances where an internal evaluation by the institution appropriately updates the original appraisal assumptions to reflect current market conditions and provides an estimate of the collateral’s fair value for impairment analysis. The documentation on the collateral’s market value should demonstrate a full understanding of the property’s current “as is” condition (considering the property’s highest and best use) and other relevant risk factors affecting value.
Classification of Renewals or Restructurings of Maturing Loans
Many borrowers whose loans mature in the midst of an economic crisis have difficulty obtaining short-term financing or adequate sources of long-term credit due to deterioration in collateral values despite their current ability to service the debt. In such cases, institutions may determine that the most appropriate and prudent course is to restructure or renew loans to existing borrowers who have demonstrated an ability to pay their debts, but who may not be in a position, at the time of the loan’s maturity, to obtain long-term financing. The regulators recognize that prudent loan workout agreements or restructurings are generally in the best interest of both the institution and the borrower.

Classification of Troubled CRE Loans Dependent on the Sale of Collateral for Repayment

This section speak specifically to how to classify the loss or potential for loss with a CRE loan. Specifically it indicates that when the sale of CRE is necessary to repay a loan the amount that that property is under water should be classified as “doubtful” but use that term sparingly.

Classification and Accrual Treatment of Restructured Loans with a Partial Charge-off

When you restructure a loan and charge off a piece the remainder of the loan is at worst substandard (rather than ‘doubtful’). It goes on to say that one workout strategy might be to separate the loan into two enforceable loans, and then you put the senior piece on your books as ‘accrual’ in many cases (meaning ‘its all good’).

Implications for Interest Accrual

If you restructure a loan that is not already in nonaccrual keep it out of there but document everything. If the restructuring happens after it hits nonaccrual then you’re going to need 6 months more of good history before you move it back to accrual. A sustained period of repayment performance generally would be a minimum of six months and would involve payments of cash or cash equivalents.

Commercial loan workouts from the secured lender’s perspective

Every loan workout of a distressed company is distinct. Numerous factors drive the secured lender’s strategies and tactics, including whether the borrower has a sustainable core business, strength of management, the type and value of the lender’s collateral, cash flows, industry strengths and weaknesses, junior debtholders and lienholders and the potential effects of a Chapter 11 bankruptcy proceeding. These factors and others affect the strategies and leverage of a secured lender in taking action to protect and assert its rights and interests, as well as its ability to structure an exit strategy. No single strategy is effective for every workout situation. Lenders, workout counsel and consultants must be prepared to roll with the waves and change their strategies and tactics. However, certain steps should be considered in most workouts by a secured lender.
Distressed borrowers tend to hope that financial problems will go away and solve themselves over time. Secured lenders often do the same when issues surface with their borrowers. Seldom, however, do such problems solve themselves without special and immediate attention. Red flags—such as declining cash flow and sales, loss of major customers, ineptitude or changes in management, failure to meet budgets and projections, requests for over-advances, borrowing base issues and failure to pay as agreedrequire immediate explanation, evaluation and attention. If management’s explanations or the secured lender’s field audits do not provide adequate explanations and solutions to the issues, independent workout consultants should be retained, as discussed below.

Retention of Experienced Workout Consultants

Experienced workout consultants are critical to a successful workout and restructuring of a distressed borrower. Too often, a secured lender and/or borrower will delay the retention of a consultant, unwilling to incur additional costs. However, the cost of a secured lender’s consultant typically can be added to the outstanding debt, and the consultant may later be a critical witness for the secured lender in a bankruptcy proceeding or litigation. An experienced workout consultant retained by the borrower can produce cash savings that more than cover the retainer agreement. The consultant should examine special issues such as unfunded pensions, leases, long-term contracts, litigation, cash flows and management issues. Advice in these areas can dramatically improve the results of a workout. Secured lenders should always consider having their counsel retain the consultant in order to potentially protect the consultant’s work product as Attorney Work Product. At times, a secured lender may require its borrower to retain a consultant as a condition to further lending under a forbearance agreement, as discussed further below. Whether retained by the secured lender or borrower, an experienced workout consultant can provide significant value. However, it is important that the scope of work and fees be addressed in advance to minimize disruption to the borrower’s operations and to keep costs as low as reasonably possible, so the borrower benefits from the process.

Documentation and Collateral Perfection Analysis

Prior to proceeding with a workout, a secured lender and its counsel should always perform a documentation and collateral perfection examination. Updated Uniform Commercial Code, tax lien and judgment lien searches should be performed on an urgent basis at the beginning of a workout. Security and loan agreements, landlord waivers, deposit account control agreements, intercreditor agreements and guarantees should be examined to assure that all executed copies are in the file. Perfection on special collateral, such as trademarks, patents and other intellectual property, in addition to causes of action of the borrower in litigation, should be examined. Secured lender’s counsel should also examine whether any delays in perfection might cause any concerns that the secured lender’s liens could be avoided as a preference or fraudulent conveyance in a bankruptcy proceeding. Finally, the effects of a bankruptcy proceeding on the rights of the secured lender should be examined and considered by the secured lender and its counsel in forming the strategies for the workout.

Collateral Review, Analysis and Valuation

Field audits of inventory, accounts receivable and equipment should be performed to assure the accuracy of the borrower’s borrowing base and other collateral reports. The potential of obtaining additional liens on unencumbered assets and second liens on collateral in which another party has a lien should be considered as consideration for continued lending. Going-concern and orderly liquidation appraisals should be considered in the event of a bankruptcy proceeding or foreclosure. The retention of the appraiser by secured lender’s counsel should be considered in order to potentially protect the appraiser’s report as attorney work product. All of the above should be completed in order to help the secured lender, its counsel and other advisors form a strategy going forward, both in and out of a bankruptcy proceeding. The secured lender and its advisors should develop a special strategy for any “icebergs,” i.e., collateral that deteriorates without the ability to move it.

Cash Flow Budgets and Projections

Short-term (four weeks, thirteen weeks) and long-term cash flow budgets and projections should be performed by the borrower and tested by the secured lender and its advisors to determine what additional over-advances or funds from equity or other interested parties are necessary to accomplish the restructure. “Budget-to-actual” reports should be required on at least a monthly basis in order to assure budget compliance.

Forbearance Agreements

Forbearance agreements are often requested by distressed borrowers during the restructuring period to avoid interruption by the secured lender. However, a properly drafted forbearance agreement can also provide signifi cant benefi ts to the secured lender. The following benefi ts to the secured lender should be considered in the forbearance agreement:
• acknowledgment by the borrower of the outstanding balance, to avoid or reconcile any disputed balance
• acknowledgment by the borrower of specific current defaults and the right to accelerate, to avoid future disputes or defenses regarding defaults (defaults should be waived only in rare instances)
• acknowledgment by the borrower that it has requested the forbearance, to establish consideration for any concessions to the secured lender
• establishment of a “forbearance termination date” or “drop dead date,” by which the borrower must resolve certain issues (i.e., over-advances, refi nancing, covenants, defaults or sale of the business or division)
• amendments to the loan agreement, such as reducing the amount of the loan commitment, increasing the interest rate or providing forbearance fees
• acknowledgment that the secured lender has a valid and properly perfected security interest, without any defenses
• acknowledgment by the borrower that the loan agreement is enforceable, without defenses
• full release and waiver of defenses by the borrower
• conditions of the forbearance, such as:
• retention of a workout consultant, who will provide regular status reporting to the secured lender
• retention of an investment banker or broker to sell the business, or a division or certain assets on an agreed upon schedule
• liquidation of excess inventory
• utilization of additional collateral, guarantees or credit support
• execution of additional documents, giving the secured lender an opportunity to cure any document or lien perfection issues
• additional fees and increased interest in consideration for the forbearance
The secured creditor should always avoid exerting excessive “control” over the operations of the borrower, to avoid a claim of equitable subordination to other creditors or becoming a “responsible person” for taxes or environmental claims. For example, a secured creditor should never force or tell a debtor to pay or not pay other specific creditors.

Credit Support

Guarantees, letters of credit and other modes of credit support such as “last out” participation in favor of the secured lender, which may have been refused at the loan inception, may be obtained from equity owners in a restructuring. Guarantees, letters of credit and certain other types of credit support are not affected by the automatic stay in the event of a bankruptcy proceeding (discussed below) because they represent third-party agreements between the secured lender and a nonborrower third party.

Pre-Bankruptcy Remedies

All realistic pre-bankruptcy proceeding remedies should be considered by the secured lender, its counsel and advisors. This includes:
• Reservation of rights
• Notice of default
• Acceleration of all obligations
• Uniform Commercial Code foreclosure on personal property collateral
• Real estate foreclosures
• “Friendly” foreclosures, where the borrower surrenders the collateral to the secured lender
In all events, the secured lender should assert only those rights provided “within the four corners of its documents” and applicable law, to avoid claims by the borrowers and other creditors such as “equitable subordination” or the much-maligned theory of “deepening insolvency.”
Potential Actions of the Borrower
All potential actions of the borrower should be anticipated and considered by the secured lender internally with its counsel and advisors, and then discussed and considered with the borrower. This includes:
• Out-of-court restructuring, including concessions by both the secured and unsecured creditors
• Assignments for the benefi t of creditors—an orderly state law process whereby all assets are transferred to an independent third-party trustee, who performs an orderly liquidation and distributes the proceeds in accordance with the priorities of law (often different from state to state)
• Liquidation under state law—the borrower and its advisors perform an orderly liquidation under the corporate laws of the applicable state statute
• the automatic stay—creditors are prevented from collecting amounts owed by the debtor, foreclosing on the debtor’s collateral and terminating contracts
• at least initially, the debtor cannot pay any unsecured creditors that existed as of the commencement of the bankruptcy
• expensive litigation against the debtor can be stayed
• the debtor is allowed to assume the contracts it desires and reject the contracts it considers burdensome.

Real Estate Attorney

When you need legal help to solve Troubled Real Estate Loans, call Ascent Law LLC for your free consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

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Utah Real Estate Code 57-1-4

Utah Real Estate Code 57-1-4

Utah Real Estate Code 57-1-4: Attempted conveyance of more than grantor owns — Effect.

A conveyance made by an owner of an estate for life or years, purporting to convey a greater estate than he could lawfully transfer, does not work a forfeiture of his estate, but passes to the grantee all the estate which the grantor could lawfully transfer.

In legal terms, conveyancing refers to transferring the title of real property from one person to another. A conveyance occurs when the owner of real estate transfers the ownership of that property to another party. This could be a home, or some other property such as commercial real estate. A conveyance can occur in full, or the owner may choose to transfer only a portion of the ownership interest.

Conveyances may occur in many different ways, including but not limited to:
• Through a sale of the land or property;
• Through transfer as a gift; or
• By inheritance, such as through succession laws.

In general, statute of frauds laws require that any type of real estate sale is to be recorded in a written contract. Thus, a conveyance of title to real estate must be in writing if it involves a sale. This is to help avoid any disputes or breaches of contract in the future, as well as to establish the legal owner of the property for other purposes, such as taxes. The owner of the property, or the “grantor,” must utilize words of conveyance in order to transfer an interest in property to the person receiving the property, or the “grantee.” Words of conveyance show the intent to transfer the title of a parcel of real property and are typically required by law, although the exact words required may vary by jurisdiction. Transfer of the actual, physical deed does not need to happen, so long as the person clearly expresses their intention to make the conveyance. The deed itself must be written, signed, dated, and should contain a description of the land being transferred. Additionally, in order for a valid conveyance to occur, there should be no title defects, such as an improperly recorded title. In general, there are four main types of real property conveyances. Variations do occur within the four main types of conveyances. However, courts will not typically recognize the transfer if the language of the conveyance does not fit within one of the four main categories.

Fee Tail

Fee tails are intended to preserve the estate in the bloodline of the person receiving the property. Thus, only the children of a fee tail holder will benefit from the fee tail. Once the holder of a fee tail dies without leaving behind any children, both the bloodline and the fee tail end, and the property returns to the original grantor. Fee tails are a type of conveyance that transfers an interest in real property to another, but restricts any further sale or transfer of the property. Fee tails are also referred to as restraint on alienation, and are abolished in nearly every state.

Fee Simple Absolute

A fee simple absolute is a conveyance of real property that gives absolute ownership in the property. The holder of a fee simple has both the present and future interest in the property. The duration is indefinite, and the interest is not subject to any specific conditions. At any time, the holder may sell all or part of the property, or distribute the property at their death through a will. These rights are commonly thought of as simply ownership of the real property, and is the most broad category of property interest;

Life Estate

Life estate refers to an interest in property that is measured by the duration of someone’s life, typically the person who is to receive the property. Once the life tenant dies, the property is transferred to the person who holds future interest. A life tenant is generally entitled to all uses and profits from the property; however, the life tenant does not maintain any rights to transfer the property when they die. As such, they do not have the right to commit waste (acting in any way that would cause the property to lose value, neglecting the premises, etc); and

Fee Simple Defeasible

A fee simple defeasible conveyance may have certain conditions or limitations placed on the transfer of property. If these conditions are violated, or are not met, the property either goes back to the original grantor, or a specified third party. There are three different types of fee simple defeasible:

 Fee Simple Determinable: The interest in the property is automatically ended when a condition is violated or unmet;
 Fee Simple Subject to Condition Subsequent: Transfer where the violation of the condition would give the original owner of the property the option to take back the property; and
 Fee Simple Subject to Executory Limitation: This conveyance confers a future property interest to a third party, not the original owner.
Conveyances of property may be disputed. Disputes over real property and the conveyance of real property occur frequently, especially when the grantor fails to provide clear and legal words of conveyance. Some examples of common conveyance disputes include:
 Attempts to convey property that the grantor does not actually, legally own;
 Will or trust disputes;
 Issues with defective or improperly recorded titles, as previously mentioned; or
 Conveyances based on fraud or deceit.
If a conveyance, or failure to convey, results in a measurable loss, legal action may be taken. Examples of remedies include damages awards and court injunction, such as an order that requires the defendant to transfer the title to the property’s buyer.
Things To Know About Conveyance Deed And Why It Is Important
In the wake of the rising number of instances of fraud and bogus selling of properties, it’s the conveyance deed or the sale deed that gives legal protection to the ownership of your property. By understanding the basics of a conveyance deed, you can guard yourself against getting duped.
 There is a little difference between the sale deed and the conveyance deed. All sale deeds are conveyance deeds but not vice-versa. Gift, mortgage, exchange and lease deeds are also types of conveyance deed.
 Governed under the Registration Act, a conveyance deed is an important document for a buyer as well as the seller because a purchase is not legally complete until it is signed by both the parties.
 A conveyance deed is made on a non-judicial stamp paper keeping the agreement to sell as the blueprint.
 The document has all the details needed to carry out for the transfer of the property title. This includes the full names of the buyer and the seller, their addresses, etc. The actual demarcation of the property in question, chain of the title of the owners, and the method of the delivery of the property are also stated.
 In the deed, the seller is also required to certify that the property is free from any legal encumbrance.

 If some loan is taken against the property, the mortgage should be cleared before proceeding, if it’s a sale deed. It’s always better to personally check with the local sub-registrar’s office.
 In case of sale deed, it would also mention the money received towards the sale transaction.
 The document would also state the exact date on which the property would be physically handed over to the new owner.
 Within a period of four months of the execution of the deed, all the original documents related to the sale of the property should be produced before the registrar for registration.
 The conveyance deed is also required to be signed by at least two witnesses with all their details included.
 After the conveyance deed is signed, it has to be registered at the local sub-registrar’s office by paying the registration fee.
Although states vary in indicators of fraud which are recognized the following factors, among others, may be used to infer fraudulent conveyance:
 An inadequate or fictitious consideration or a false recital as to consideration;
 The fact that property is transferred by a debtor in anticipation of or during a pending suit;
 Transactions which are not in the usual course or method of doing business;
 The giving of an absolute conveyance which is intended only as security;
 The failure to record the conveyance or an unusual delay in recording the payment;
 Secrecy and haste are ordinarily regarded as badges of fraud but are not in themselves conclusive of fraud;
 Insolvency or substantial indebtedness of the grantor;
 The transfer of all the Debtor’s property, especially when she is insolvent or greatly financially embarrassed;
 An excessive effort to clothe a transition with the appearance of fairness;
 The failure of parties charged with fraudulent conveyance to produce available evidence or to testify with sufficient preciseness as to the pertinent details, at least in cases where the circumstances under which the fraud, transfer took place are suspicious;
 The unexplained retention of possession of property transferred by Grantor after conveyance;
 The buyer’s employment of the seller to manage the business as before, selling the goods which were the subject of the transfer;
 The failure to examine or to take an inventory of the goods bought or the presence of looseness or incorrectness in determining the value of property;
 The reservations of a trust for the benefit of the grantor and the property conveyed;
 The existence of a blood or other close relationship between the parties to the transfer.
Conveyance Deed mean
One should first understand the meaning of ‘Deed’. It is a written document that is sealed and signed by all parties involved in property transaction (buyer and seller). It is a contractual document that includes legally valid terms, and is enforceable in a court of law. It is mandatory that a deed should be in writing. When each party agrees and all the liabilities has been fulfilled as per the agreement of sale of any property, a final document is signed by the seller in favor of the purchaser. This documents that all rights of seller over a property henceforth has been transferred to the purchaser. This is the deed of conveyance.
“Conveyance Deed records the transfer of interest in immovable property. The conveyance in the immovable property may take place by way of sale deed, gift deed, exchange deed etc,”
What is the difference between sales and Conveyance Deed?
It has also been observed that buyers are usually confused about the two terminologies sales deed and Conveyance Deed.

Sale Deed

A Sale Deed acts as the main legal document for evidencing sale and transfer of ownership of property in favors of the buyer, from the seller. Further, it also acts as the main document for further sale by the buyer as it establishes his proof of ownership of the property. The Sale Deed is executed subsequent to the execution of the sale agreement, and after compliance of various terms and conditions detailed in the sale agreement as agreed upon between the buyer and the seller. The Sale Deed is the main document by which a seller transfers his right on the property to the purchaser, who then acquires absolute ownership of the property.
“Conveyance and Sale Deed essentially have no difference as in both the documents, the right, interest and title of the previous owner is transferred to the purchaser. Conveyance Deed includes Sale Deed i.e. Sale Deed is one of the mode of conveyance i.e. transfer of interest. All deeds transferring the property-rights are Conveyance Deeds. Sale Deed is one of them,” But what is to be taken into the account that all Sale Deeds are deeds of conveyance but all Conveyance Deeds are not sale deeds. So, Conveyance Deed is a broader concept including the Sale Deed in it. On signing a Conveyance Deed, the original owner transfers all legal rights on the property to the buyer, against a certain consideration which is usually money. However, this consideration is non-significant in the case of Gift Deeds, as they are based on familial bonds.
Conveyance Deed is required to contain the following:
 Complete identification and demarcation of the boundaries of the property
 Information of all the parties who are involved, such as name, age addresses and signature of both the parties involved – buyer and seller
 Mention of any other rights (if applicable) annexed to the property and its use
 The chain of title, that is, all legal rights to the present seller
 The method of delivery of the given property to the buyer
 The sale agreement, which is the main requirement of the drafting of the valid sale deed and both the parties, must mutually settle the terms and conditions of the agreement. A sale deed always precedes agreement to sell
 The sale consideration clause, which is the memo of the consideration, stating how it has been received
 Any other terms and conditions that are applicable as far as the transfer of ownership rights are concerned
The Conveyance Deed procedure
The Conveyance (or sale) Deed is required to be executed on non-judicial stamp paper. Once that is done it needs to be registered by presenting it at the Registrar’s office, and remittance of the registration fee. After the registration is done, the transfer of the property moves into the public domain. Stamp Duty and Registration Fees is obtained by the government as revenue. When this happens, the process of Conveyance Deed is officially over. If the builder is not alive, it can be done by the legal heirs/representative of the builder. You need to draft a Conveyance Deed and apply before registration. Engage any local counsel who is dealing in these matters.

Should I Hire an Attorney for Help with Conveyance Issues?

A skilled and knowledgeable estate attorney may prove to be an invaluable asset when conveying property to another person. An experienced estate attorney will be knowledgeable about your state’s specific property laws, and will be able to assist you in drafting any necessary real estate contracts. Additionally, they will be able to represent you in court, should any disputes arise.

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It’s not a matter of if, it’s a matter of when. Legal problems come to everyone. Whether it’s your son who gets in a car wreck, your uncle who loses his job and needs to file for bankruptcy, your sister’s brother who’s getting divorced, or a grandparent that passes away without a will -all of us have legal issues and questions that arise. So when you have a law question, call Ascent Law for your free consultation (801) 676-5506. We want to help you!

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

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Lis Pendens In Utah Explained

Lis Pendens In Utah Explained

Lis pendens (pronounced as liz pendenz). This Latin expression signifying “claim pending” alludes to an authoritative report intended to illuminate the open regarding a claim that could influence the privilege to claim or have a particular package of land. The exact laws and systems encompassing a lis pendens differ from state to state, however in Utah the accompanying standards apply. A lis pendens is recorded against the property in the district recorder’s office, which means it will appear in a title search, like a lien against the property. The lis pendens recognizes the claim and the court where it is recorded with the goal that invested individuals can examine the claim and study it before choosing whether they need to obtain an enthusiasm for the property. In addition to that, every potential purchaser and banks are put on notice of the pending claim and will be bound by the claim’s result, regardless of whether they didn’t really observe the lis pendens or know about the claim.

Addendum to that most purchasers shrug off the likelihood of buying property the court may later choose did not have a place with the dealer. Thus, a lis pendens can make it hard to-incomprehensible for a proprietor to move his or her property. State the purchaser proceeds with it, be that as it may, and the court later chooses it was never the merchant’s to sell. At the point when this occurs, the purchaser accepts all negative consequences, with the individual in question winding up flat broke. Correspondingly, if a purchaser buys property trusting it to be without lien, yet does as such despite a lis pendens recorded by somebody asserting a lien against the property, the purchaser will in all probability need to either pay the lien holder the cash owed it or relinquish the property to abandonment should the court announce the lien legitimate. The chronicle office will record a lis endless supply of any individual who professes to be qualified for do as such (for example since he has documented a claim). On the off chance that another person with an enthusiasm for the property (for example the proprietor) accepts the lis pendens isn’t legitimate, he would then be able to record suit to have it erased. A few states’ lis pendens rules require the filer of the notice, in case of a test to the notice, to establish that it has reasonable justification or a sensible probability of progress on the benefits of its case in the basic claim. Different states don’t have such a requirement.

Can a lis pendens be documented regardless of whether there is certainly not a pending claim? No. A lis pendens must be documented if a claim is pending. All things considered, that is the thing that the expression implies – claim pending. Any gathering to a claim can record a lis pendens. Normally it is documented by the offended party, however it can likewise be recorded by a respondent.

Notwithstanding a lis pendens must be recorded in a claim that will choose either 1) who possesses the property; or who can have the property. On the off chance that the claim will choose either of these inquiries, a lis pendens can be recorded. This is the situation regardless of whether there are different issues that will be chosen in the claim that don’t include the property. A lis pendens must be recorded as for claims that look to abandon development or preconstruction administrations liens.

Initial, a claim must be documented that will decide the privilege to possess as well as have land. Second, one of the gatherings to the claim (more often than not a gathering’s lawyer) will set up a composed lis pendens and document the lis pendens with the court. Third, when the lis pendens has been documented with the court, the gathering must at that point record the lis pendens with the region recorder’s office of the region wherein the property is found. The recorder will charge a little chronicle expense. Neglecting to finish any progression, or playing out any progression out of request, could nullify the lis pendens.

A proprietor of land burdened by a lis pendens can endeavor to have the lis pendens expelled from his property three unique ways. To start with, the proprietor can attempt to get the lis pendens holder to discharge its lis pendens deliberately, for example, by giving the lis pendens holder what it is requesting, achieving a settlement with the lis pendens holder, or persuading the lis pendens holder that the lis pendens is ill-advised. Second, the property proprietor might probably document a movement with the court asking that a request be issued discharging the lis pendens. To prevail on such a movement, the property proprietor should demonstrate that the lis pendens is invalid. Third, the property proprietor can win the claim on the issue(s) offering ascend to the lis pendens.

Following are fundamentals doctrines of Lis Pendens:

• TRANSFER DURING THE PENDENCY OF SUIT: Move by any gathering to the prosecution ought to have occurred during the pendency of suit.
• COMPETENT COURT OF JURISDICTION: Suit must be pending in the court of capable locale.
• SUIT SHOULD BE NON-COLLUSIVE: Suit ought to be non-tricky. On the off chance that the case is tricky, at that point this principle isn’t material.
• SUIT RELATING TO IMMOVEABLE PROPERTY: Suit should the identifying with enduring property.
• RIGHT TO IMMOVEABLE PROPERTY MUST BE DIRECTORY: It is vital that privilege to immoveable property must be straightforwardly and explicitly being referred to.
• RIGHTS OF OTHER PARTY: It is likewise fundamentals of precept of Lis Pendens that move or transfer of unflinching property should influence privileges of other gathering to suit or continuing.
• Special case OF LIS PENDENS: There is a special case in regulation of Lis Pendens when to property move by the activity of law then this convention isn’t pertinent.
• Help UNDER DOCTRINE OF LIS PENDENS: Help under area 52 being n evenhanded alleviation must be acquired on the totality of components showing up on the record and not on the simple consistence or rebelliousness of the revised arrangement of exchange of property act and enlistment act.

• To finish up it very well may be expressed that fundamental standard, which works behind precept of Lis Pendens is that the same old thing ought to be presented during prosecution. It uncovers that essential object of this regulation is to keep up business as usual and secure gatherings to some prosecution against their rivals estrangement of property during pendency of suit especially when some privilege to immoveable property is being referred to in such case.

Under the Utah Code, a lis pendens must contain the names of the gatherings associated with the case, the article or reason for the legitimate activity, and a depiction of the property influenced. The lis pendens should then be recorded against the subject property in the fitting region recorder’s office. “Lis pendens” is a Latin expression frequently deciphered as signifying “suit pending.” It is an archive which, when appropriately recorded with an area recorder’s office, has the legitimate impact of putting all people or substances with an enthusiasm for genuine property on notice that there is case pending concerning that genuine property. In certain lawful activities, for example, an activity for parcel of genuine property, involved with the activity might be required by resolution to record a lis pendens. On the off chance that you are associated with a question including land or considering an exchange including land, it is critical to have legitimate exhortation from a capable Utah land lawyer. When buying genuine property in Utah, it is indispensable to play out a fitting title search to decide if clear title to the property can be gotten. Finding a lis pendens recorded against the property will put a potential buyer on notice that there is pending case. The documenting of a lis pendens likewise serves to secure different gatherings, other than a potential buyer, who have an enthusiasm for the property. Under Utah Code area 78B-6-1303, a buyer or encumbrancer of the property is considered to have productive notice of the pending case, regardless of whether that buyer or encumbrancer does not have genuine notice or learning of the prosecution.

The unfair lien resolution takes into account evacuation of any encumbrance against property if the lien is illegitimate. A lis pendens can be an illegitimate lien in the event that it was recorded before case initiated including title to or an enthusiasm for genuine property. A lis pendens viably banishes anybody from renegotiating and evacuating value in property or selling or moving the property. The individuals who get the property with a lis pendens recorded against it take title subject to whatever case is eventually dictated by a courtroom. A lis pendens is simply a republication of the pleadings and consequently goes inside the legal activity benefit. Therefore, if a claim has really been recorded influencing title to genuine property, the lis pendens can be documented without any potential repercussions. On the off chance that the lis pendens is an unfair lien, the resolution accommodates a facilitated hearing to expel the unjust lien, just as for treble harms or $1,000, whichever is more noteworthy.
The issue with an appropriate lis pendens is simply the resolution. It used to be that once a lis pendens was documented, it remained against the property until a judgment was recorded demonstrating how the claim confirm by the lis pendens was settled or the lis pendens was willfully discharged. The lis pendens was treated as just a republication of the pleadings. With the adjustments in the lis pendens rule, notwithstanding, a lis pendens can be evacuated by court request under the watchful eye of the claim over title to genuine property is at long last decided.
In the option, the Court may condition keeping the lis pendens set up with the posting of a bond.

Utah State Lis Pendens – Notice

• Any gathering to an activity recorded in the United States District Court for the District of Utah, the United States Bankruptcy Court for the District of Utah, or an Utah region court that influences the title to, or the privilege of ownership of, genuine property may document a notice of pendency of activity.
• A party that documents a notice of pendency of activity will:
• first, record the notice with the court that has ward of the activity;
• second, record a duplicate of the notice documented with the court with the region recorder in the area where the property or any part of the property is found.
• A individual may not document a notice of pendency of activity except if a case has been recorded and is pending in a United States or Utah region court.
• The notice will contain:
• the inscription of the case, with the names of the gatherings and the case number;
• the object of the activity or barrier; and
• the explicit legitimate depiction of just the property influenced.
• From the season of recording the notice, a buyer, an encumbrancer of the property, or some other gathering in intrigue that might be influenced by the activity is considered to have helpful notice of pendency of activity.

In any activity influencing the title to, or the privilege of ownership of, genuine property the offended party at the season of documenting the grumbling or from that point, and the respondent at the season of recording his answer when agreed alleviation is asserted in such answer, or whenever a while later, may petition for record with the recorder of the province in which the property or some part thereof is arranged a notice of the pendency of the activity, containing the names of the gatherings, the object of the activity or resistance, and a depiction of the property in that area influenced in this manner. From the season of documenting such notice for record just will a buyer or encumbrancer of the property influenced in this way be esteemed to have valuable notice of the pendency of the activity, and just of its pendency against gatherings assigned by their genuine names. Under the Utah Code, a lis pendens must contain the names of the gatherings associated with the case, the article or reason for the legitimate activity, and a depiction of the property influenced. The lis pendens should then be recorded against the subject property in the fitting province recorder’s office. That finishes the lawful notice here under the rule above.

Lis Pendens Lawyer Free Consultation

When you need legal help with a Lis Pendens in Utah, please call Ascent Law LLC for your free consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

Ascent Law LLC

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Utah Real Estate Law

As a Real Estate Lawyer will tell you, real еѕtаtе law iѕ multi-саtеgоrizеd аnd iѕ governed bу a lot of different fасеtѕ. “Rеаl” rеfеrѕ tо real рrореrtу. Thiѕ is lаnd and thе things that аrе permanently a раrt of thе area, thаt is, whаt is аttасhеd.

Utah Real Estate Law

This gоеѕ fоr аnуthing “undеrnеаth” tоо, ѕо if any сrudе oil оr natural gаѕ iѕ buriеd bеnеаth, thе lаnd оwnеr hаѕ firѕt rightѕ tо the resource.

With рrореrtу оwnеrѕhiр, оr thе prospect оf owning, thеrе соmе riѕkѕ. Mоѕt of thiѕ iѕ liаbilitу, liаbilitу tо the ѕtаtе and thоѕе whо bоrdеr the рrореrtу. Fоr inѕtаnсе, whеn рurсhаѕing a lоt within thе сitу, there аrе zoning rеѕtriсtiоnѕ. We’ve talked about each of the different areas of Real Estate law here.

A сitу mау dеѕignаtе a certain ѕizе ѕtruсturе on the land, аnd if the оwnеr decided to аѕѕеmblе a fоur-ѕtоrу gоliаth mansion hоmе, thе оthеr оwnеrѕ of single flооr rаnсhеr-ѕtуlе hоuѕеѕ on thаt blосk might not bе ѕо рlеаѕеd, thе same goes with thе city.

Rеаl Estate also саllеd immоvаblе property inсludеѕ thе ownership аnd possession of lаnd аlоng with anything реrmаnеntlу аffixеd to thаt land ѕuсh аѕ buildingѕ, gаrаgеѕ, improvements and buildingѕ. Subѕtаnсеѕ that are bеnеаth thе lаnd (such аѕ gas, оil, minеrаlѕ) аrе аlѕо соnѕidеrеd реrmаnеntlу аttасhеd. Hоwеvеr, other items, whiсh саn bе attached tо the lаnd, but аrе not реrmаnеnt, ѕuсh as mоbilе homes аnd tool ѕhеdѕ, are nоt соnѕidеrеd to bе real property.

Thеrе is a grеаt deal оf ownership liаbilitу that gоеѕ tо third-раrtiеѕ аѕ well, ѕuсh аѕ land оwnеrѕ рауing mortgage on a hоuѕе tо a lender. Thiѕ iѕ рrоbаblу thе most common liability that iѕ knоwn. If the owner does not рау, then thеу default оn thе lоаn аnd thе lender, ѕuсh аѕ a bаnk саn сlаim the property аѕ payment.

Real Estate Lawyers

Property lаwѕ trace itѕ hiѕtоrу back to the mоnаrсhѕ whо rulеd much оf the соntinеnt of Eurоре. Thiѕ was brоught tо Amеriса and frоm there has еvоlvеd a grеаt dеаl. Rеаl еѕtаtе lаw, likе mоѕt all lаw tуре, iѕ still constantly еvоlving tоdау аѕ nеw саѕеѕ аrе brоught to courts.

Bесаuѕе еvеntѕ аrе оftеn rеlаting to gеоgrарhу аnd local сulturеѕ аnd lаw, there аrе a lot оf аѕресtѕ оf real еѕtаtе law that reflect thiѕ and are dividеd uр bу states.

Real еѕtаtе iѕ оftеn considered ѕуnоnуmоuѕ with real property аѕ opposed tо реrѕоnаl property, which inсludеѕ аll оthеr property аnd iѕ аlѕо саllеd realty.

Rеаl estate iѕ оnе оf the оldеѕt areas of law аnd contains many archaic tеrmѕ аnd соnсерtѕ. Mаnу соnѕumеrѕ find thе unfаmiliаr tеrmѕ uѕеd in the real еѕtаtе game trifling confusing whеn thеу еntеr the rеаltу mаrkеt. Hоwеvеr, tоdау wе find thаt mаnу оf thе rightѕ аnd rеѕроnѕibilitiеѕ rеgаrding real еѕtаtе hаvе еvоlvеd аnd bееn uрdаtеd as society has changed.

Owning rеаl property – Thе rеаl estate lаw ѕауѕ thаt when уоu оwn рrореrtу, уоu hаvе thе right to do whatever уоu wаnt with thе lаnd, except whаt is rеѕtriсtеd bу the rеаl еѕtаtе lаw. You hаvе thе right to use the lаnd, rent or lеаѕе it, ѕеll оr transfer it, use it аѕ collateral fоr a loan, bеԛuеаth it tо a bеnеfiсiаrу оr even juѕt gift it аwау. You could also let it ѕit idlе but in ѕоmе саѕеѕ, thiѕ mау infringe оn laws imposed bу thе ѕtаtе.

Thеrе exist ѕоmе restrictions imposed bу rеаl еѕtаtе lаw on owning rеаl рrореrtу. Although, оn one hand, it is ѕаid thаt оnе саn dо whatever оnе wаntѕ if hе owns thе рrореrtу, thеrе аrе some restrictions imроѕеd by thе gоvеrnmеnt – fеdеrаl, ѕtаtе, country аnd lосаl lаw еnfоrсеmеnt аgеnсiеѕ. Viоlаtiоn оf thе rеаl estate lаw can rеѕult in hеftу fines, реnаltiеѕ, injunctions аnd in ѕоmе cases еvеn criminal рrоѕесutiоn. Thе thrее mоѕt соmmоn restrictions аrе:

Zoning – Zоning lаwѕ rеѕtriсt the uѕе оf thе рrореrtу with rеgаrdѕ to rеѕidеntiаl, induѕtriаl, аgriсulturаl оr соmmеrсiаl рurроѕеѕ. Thе ѕizе and hеight оf imрrоvеmеntѕ аttасhеd to the рrореrtу are also subject tо rеѕtriсtiоn.

Envirоnmеntаl Hаzаrdѕ- Thiѕ infоrmѕ you оf whаt mаtеriаlѕ саn be ѕtоrеd оn thе real property as wеll as whо iѕ rеѕроnѕiblе fоr rеmоving еnvirоnmеntаl hazards frоm real рrореrtу. Thеѕе would inсludе gоvеrnmеnt-rеgulаtеd mаtеriаlѕ ѕuсh as аѕbеѕtоѕ, lеаd раint, petro-chemicals, radon and toxic wаѕtеѕ.

Publiс and Private Eаѕеmеnts and Rights of Wау– Sоmе portion оf the rеаl рrореrtу will hаvе tо be lеft ореn fоr оthеrѕ tо use. Eаѕеmеntѕ and right оf wау аrе used tо allow ассеѕѕ tо оthеr рrореrtу tо provide fоr roads and sidewalks аѕ wеll аѕ tо еnаblе electric/gas/telephone/sewer linеѕ to be inѕtаllеd.

Bеѕidеѕ thе above-mentioned rеѕtriсtiоnѕ, there аrе аlѕо ѕоmе nоn-gоvеrnmеntаl rеѕtriсtiоnѕ like thоѕе of private раrtiеѕ that may be imроѕеd оn the uѕе оf уоur real estate рrореrtу. Fоr inѕtаnсе a rеаl еѕtаtе developer will hаvе tо decide on lоt ѕizеѕ, аrсhitесturаl dеѕign and vеhiсlе раrking subject tо соnditiоnѕ рut uр in thе purchase contract. Thе rеѕultѕ fоr viоlаtiоn of рrivаtе party аgrееmеntѕ include an аwаrd оf dаmаgеѕ аgаinѕt the viоlаtоr and injunсtivе rеliеf.

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Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

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