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Last Updated: May 14th, 2012 - 22:24:01 |
Thousands of buyers of investment properties have rebutted two threats by Investment Property Developers and builders. Yes two threats by them are looming each time that you enter a home loan for a contract with them to build you a house or business.
1. “I have the power to stop you from selling your unit previous to you receiving transfer of it.” They may threaten.
2. “This contract is my voetstoots agreement thus it prevents me from being liable for any property defects – patent or latent.” Rebut either of these two threats. Your real estate investment and any accompanying investment loans are too precious to jeopardize.
To begin with, the first threat to our investment real estate can come because a developer has their right to thwart you reselling your investment property just before you actually begin to take transfer.
Say, for example, you purchase an investment property in some major development. Before that first brick is ever laid, even twelve to eighteen months in advance of that time, you will likely be required to go ahead and put down your deposit of at a minimum, 10 percent of that mortgage investment’s value. You will also need to make compulsory payments of greater value if you have not submitted an application for a bond and have not supplied a bank guarantee, maybe as high as 30 percent. (Normally, you will receive market-related interest comparable to mortgage rates on your deposit, nevertheless that is not relevant to their threat.)
Also, If you still get into monetary troubles and you still need the money; or later if someone else requests purchase of the investment property from you for considerably more than what you paid for it, you may discover that your new building contract and even some home improvement contracts give these developer the exactly what they need to refuse your immediate sale to any one else. Why would your developer hinder your resale of investment property that you have already paid a mortgage loan on? For this reason, each developer desires all prospective buyers to buy their units from him. That is why, your sale may possibly deprive him the highest future chances to sell more additional units. Rebut all possible developer threats by reading the details of any contract before you sign it. If it contains this “NO RESALE” clause in it. Cross it out and have the developer initial where you crossed it out. You initial it also. Safeguard your investment cash and your investment home loans by never giving up your rights.
Secondly, if a real estate franchise developer tries getting you to sign a voetstoots agreement saying that they will not be held legally responsible for any defects, patent or latent, cross that part of the contract out also, and force the initialing of the change.
But does a developer or a commercial real estate brokerage, legally have the right to have you sign away all safety guarantees that they otherwise would owe you under Federal Law?
Yes, you could be liable for all home remodeling costs. Why? Because a voetstoots clause does in an offer you have signed to purchase, exclude liability for most patent defects and also for latent defects. (Note that a latent defect is the unknown defect, i.e. one that does not show, patent to your naked eye.)
Once again, be forewarned and Guard yourself. Because. when that offer to purchase contains a voetstoots clause, well then, you the buyer have no way out against the seller. Don’t even fool with those developments if they refuse to change the contract.
Ask your local commercial real estate brokerage about these contract clauses/ In deed, when a seller seriously fails to disclose any and all defects to you, and instead tries to hide their liability behind this voetstoots clause, they are, in fact, committing fraudulent misrepresentation because the law prohibits non-disclosure.
If you already signed an offer to purchase that contains a voetstoots clause, ask your real estate lawyer for advice. You still may be able to either scratch out this clause or else reword it so that you are now afforded more protection. GUARD that investment home.
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