Updated: Friday, September 21, 2018
The New District of Columbia TOPA Law
In July, the D.C. Council revised the law - exempting most single-family homes, including those with basement rentals also known as "accessory dwelling units." The council opted to exempt single-family homes based largely on a study showing that only 5 percent of renters ended up buying their homes under the previous law.
If youre a renter disappointed that you wont be able to buy the single-family house youre in, you might be interested to know that there are two exceptions - if the tenant is more than 62 or disabled and if they signed a lease before March 31 and moved in by April 15 they are entitled to a modified TOPA.
The law is a little complex, so lets take this example:
John owns a D.C. condo and Gale is his tenant. John has just listed the property for sale with a real estate company for 650,000. Gale does not qualify for the modified TOPA. Prior to July 3, John had to send a single-family TOPA form to his tenant. Now, he only has to send Gale a notice that he
intends to sell. A copy of the form referred to as "Form 1 must also be sent to the D.C. Office of Tenant Advocate as well as to the D.C. Department of Housing and Community Development DHCD. Since TOPA is not applicable in our example, John is free to sign a contract with anyone and ultimately go to closing. Of course, Gale still has all of the other rights available to tenants here in the District, and still has the right to buy if she submits an offer which is accepted.
But now lets change the facts: Gale is either over 62 or disabled and meets the calendar requirements spelled out above. She receives Form 1. By law, she must advise John within 20 days after receiving the form that she may be eligible for the new TOPA. Gale officially advises John by sending him Form 2 which explains her status. That form is called "Letter to Landlord."
Proving that Gale is over 62 is not difficult. All she needs is a passport, a drivers license or some other document reflecting her age. But proving disability is more difficult. Accordingly, Gale sends another form Form 4 called "Response Letter to DHCD" if claiming elderly or disabled status. To protect the privacy of the tenant, that form only goes to the District, which will determine if Gale qualifies.
If the city certifies her as eligible, John must then send her a form that either tells her he has or does not have a third party sales contract. Once Gale receives either form, she has 20 days to advise John of her interest in buying. She then has 25 days to negotiate a sale contract with John. If that is accomplished, Gale has an additional 45 days to go to settlement. That can be extended to 75 days if a lender indicates it needs a little more time.
The interesting question: Can Gale assign her TOPA rights to a third party? One of the main reasons TOPA was recently amende is that many tenants were assigning TOPA rights for lots of money, much to the disadvantage of the landlord. And often landlords were literally held hostage by tenants demanding money in order to >
Yes, Gale can assign her TOPA rights, but she cannot receive any financial payment for the assignment. The assignee can only give Gale is a 12-month extension of her lease after it expires and at the same rental rate.
Tenants living in houses with only two to four units or in buildings with five or more apartments remain under the old TOPA law.
The new law will clearly make it easier for single-family homeowners as well as owners of condos and co-ops to sell without having to go through a time-consuming process, and will discourage the efforts by tenants to stall the process in order to get more money. Since its inception many years ago, there have been numerous lawsuits in which plaintiffs often tenants were seeking guidance
on the impact of TOPA on a specific set of facts.
Only time will tell if the modified TOPA is judgment proof.
The new forms can be found here.nbsp;
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Construction and Permanent Loans Explained
A construction loan is one where funds are issued to build a new home. Some construction loans provide financing to build on someonersquo;s lot they already own while some construction loans provide funds for both the lot and the construction. Construction includes funds for both soft and hard costs. Soft costs are those for things such as permits, zoning and legal compliance while hard costs are for materials and labor, for example.
When someone builds a new home, theyrsquo;ll work with an architect to design the home. Sometimes they can also pick from a builderrsquo;s list of plans and choose a set of blueprints previously completed. The next step is to get a bid from a contractor who will break down the cost to build the home and how long it will take to complete the project. Next, the plans are delivered to the bank who will review the project and if it complies with the bankrsquo;s construction guidelines, the loan is approved.
But the construction loan isnrsquo;t issued in one lump sum. Instead, funds are issued in stages of completion as the home is being built. The first issuance of funds might be to clear and prepare the lot. Once the bank is alerted the lot has been prepared, an inspector will arrive at the property and confirm its completion. Then, the next stage is funded and so on until the home is finally finished. The bank will order out one last inspection to confirm the property is ready for occupancy. Now, the bank wants its money back.
Construction loans are short term in nature, only long enough to finish the project. This is where a permanent loan comes into play. While the home is being built, the buyers also obtain approval from a mortgage company that will issue a traditional mortgage, paying off the construction loan completely. There are a few programs out there that combine both the construction and permanent financing with just one loan, referred to as a ldquo;one time closerdquo; loan or something similar.
Yoursquo;ll want to talk to your mortgage loan officer about permanent financing and the construction process in general and get your various financing options. But with many, getting a construction loan first and then replacing it with a permanent loan is the less expensive path.
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HGTV Designer Leanne Ford Simplifies Finding the Perfect White Paint with PPG
ldquo;We all should feel empowered to create a space for ourselves that we love coming home to at the end of the day,rdquo; said Ford. ldquo;Color is such an impactful way to do this, so Irsquo;m thrilled to work with PPG, a leader in paint and color that is headquartered in my hometown of Pittsburgh, to bring the power of paint to life for homeowners. Itrsquo;s really about giving everyone the confidence to use paint and color fearlessly in their homes to create spaces that theyrsquo;re proud of. For me, this all starts with picking the perfect white paint.rdquo;
For Ford, the ldquo;perfect white paintrdquo; palette will be represented in three PPG tones: Pure White, a true white hue, Natural White with a warmer tone, and White On White as a cooler alternative.
Swatches of PPG Pure White, PPG Natural White, PPG White On White
How should homeowners choose the perfect white for their home? Ford simplifies the process by providing some design tips for each hue.
When using Pure White, Ford recommends pairing it with exposed brick, marble, or greenery to give spaces a more modern look, and also suggests Pure White in rooms that seek to enhance natural light.
Natural White is best matched for those homeowners seeking to create a ldquo;cozy retreat,rdquo; as this hue is the warmest of the bunch and is more likely to provide a sense of >
Finally, Ford suggests pairing PPGrsquo;s White On White with wood tones and mixed metals, and recommends using this hue in smaller rooms to make them feel more spacious.
The colors are available in the PPG Timelessreg; and PPG Diamondtrade; paint lines at The Home Depot locations across the U.S.
To read the full press >
Photos courtesy of PPG.
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