Real Estate
Buying and Selling Real Estate
Landlord-Tenant
Buying and Selling Real Estate
If you use a real estate broker to sell your property, you will likely enter into a written contract called a listing agreement. A real estate broker may negotiate with you on some of the terms such as the amount of commission to be received, the length of time during which the broker may sell the property and receive a commission, and just what he or she will do for you to sell your property. An exclusive right to sell listing entitles a broker to a commission regardless of who sells the property. The listing agreement may provide that the broker will receive a commission even after the listing agreement has expired if the property is sold to a prospect produced during the term of the listing agreement.
An earnest money agreement sets out the steps necessary to conclude the sale. Once a buyer and seller sign this agreement, they are legally bound to purchase and sell the property according to the terms in the agreement. It is essential that both parties understand the terms and consequences of the earnest money agreement. The earnest money agreement lists the parties, describes the property, the kind of deed, the price, the earnest money deposit amount, the terms of payment, and many other conditions. The earnest money agreement may provide that the buyer will lose his or her deposit by backing out of the deal. A preliminary title report is often obtained after the earnest money agreement is signed and before the title insurance policy is issued. The preliminary title report will show limitations on the use of the property and any indebtedness against the
property.
A policy of title insurance is issued by a title insurance company at the time of closing. A number of serious risks exist that a title insurance policy may not cover, such as claims for labor and materials not shown by the courthouse records, unrecorded easements, rights of parties actually in possession of the property - such as renters, and limitations on the use of the property, such as zoning restrictions.
State law requires sellers to complete and give a disclosure statement in statutory form to each individual who makes a written offer to purchase real estate in Oregon. A buyer who receives a completed disclosure statement has five business days in which to revoke the offer to purchase the property by delivering a signed, written statement of revocation. If the seller refuses to provide a completed disclosure statement in statutory form, the buyer may terminate at any time up until closing.
The exchange of money (or properties, in an exchange transaction) and documents in the closing of a real estate transaction usually will be handled by an escrow agent selected by the parties. An escrow agent is a neutral third party. A deed transfers ownership of property from the seller to the buyer. There are several types of deeds, such as statutory warranty deed, special warranty deed, bargain and sale deed and quitclaim deed. The type of deed affects the buyers rights against the seller and all former owners.
Typically, a homeowner gives a lien on his or her house to the bank as collateral for payment of a loan to the bank. There are four common types of liens on real property. Those are (1) a trust deed; (2) a mortgage; (3) a land sale contract; and (4) an involuntary lien. A trust deed is a special type of mortgage given by the owner of the real property to a third party, called a trustee, who holds a power of sale for the property for the benefit of a creditor (such as a lender) until the debt is repaid. Banks and other lenders typically use a trust deed. A mortgage is similar to a trust deed but does not involve a third party trustee. With a mortgage, the owner gives a lien on the property as collateral for the debt.
A land sale contract is an agreement between the seller and the buyer stating the purchase price and how it is to be paid as well as all other rights and duties of both the parties regarding the payment of the purchase price. The buyer does not usually receive a deed to the property until all payments required by the contract have been made. The final category of liens is those that are placed against the property without the owner's consent. Those can include liens filed by workmen on the property, liens filed for unpaid taxes and liens filed by creditors holding judgments against the owner.
The Oregon Residential Landlord-Tenant Act (ORLTA) is found in Oregon Revised Statutes Chapter 90 (ORS 90). With a few exceptions (dorms, fraternities, residential managers), it applies to all residential tenancies. A waiver of the tenant’s rights under the Act would be a violation of the law under ORS 90.245. A landlord cannot rent “as is” - a rental unit must meet habitability standards set forth in ORS 90.320 and ORS 90.100 (9)(a). These minimum standards include plumbing systems, heating systems, water and weather proofing, electrical system, sanitation, working locks and keys, and garbage receptacles. If the lack of an essential service poses an imminent and serious threat to the tenant’s health, safety or property, the tenant may either terminate the lease on 48 hours written notice or have repairs performed by a licensed contractor and deduct up to $1000 from the rent. If the lack of essential services does not pose an imminent and serious threat, the tenant may terminate the lease on seven days written notice or deduct up to $500 in repairs. Any other repairs that may be necessary, but not essential, must be made by the landlord within thirty days. A tenant may also file a counterclaim in an eviction action alleging that the landlord failed to maintain habitability standards and claim the diminished value of the premises. If a landlord forces a tenant out of the premises by refusing to provide essential services, the landlord may be subject to damages for constructive eviction in the amount of the tenant’s actual loss, or twice the amount of the monthly rent, whichever is greater.
Late fees may not be assessed until after the fourth day of a weekly or monthly rental period. Late fees may not exceed a “reasonable” amount. Simple interest may be charged on a late fee. However, the landlord may not deduct unpaid late fees from rent payments, thereby making any subsequent rent payment late. A landlord must account for charges withheld from the security deposit. in writing within thirty one days after the termination of the tenancy.
ORS 90.315 requires that the rental agreement or a separate notice must inform the tenant if a tenant is required to pay for any shared utility service that benefits the landlord or another tenant. Landlords must disclose the presence of any known lead-based paint and or lead based paint hazard in any house built prior to 1978 except studio apartments, dormitories, and individual rental rooms. Civil penalties can range up to $10,000 for each violation.
The landlord, except in emergencies, must give a tenant 24 hour notice to inspect the premises, to make necessary repairs, or to show the premise to prospective tenants. A landlord cannot take retaliatory action against a tenant for complaints about the landlord’s failure to comply with the law, failure to make required disclosures, testifying against a landlord in a hearing, filing or threatening to file a government complaint, or violating premises habitability standards. If a landlord tries to enforce any prohibited provisions in a rental agreement, such as waiver of liability for willful or negligent misconduct, the tenant may recover actual damages, three months’ rent, and attorney’s fees.
A landlord may generally serve the tenant a 72- hour notice terminating the rental agreement for failure to pay rent on time. A landlord may serve a 24- hour notice if a tenant, or a tenant’s pet threatens personal injury or inflicts substantial personal injury upon the landlord or other tenants or commits outrageous acts, such as the manufacture of controlled substances, prostitution, intimidation or burglary.
ORS 90.425 provides that a landlord may remove and dispose of a tenant’s personal property if a tenancy is terminated and the landlord reasonably believes that the tenant has no intention of asserting a claim to the property. The landlord must remove the abandoned personal property from the premises to a safe storage location and provide the tenant notice of the landlord’s intent to dispose of the property. If the landlord keeps the property for personal use, the tenant may recover up to twice the amount of the tenant’s damages.
