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Mortgage Lawyers in Orlando, Florida
If you are a private lender issuing mortgages, Legal Counsel, PA employs an Orlando, Florida mortgage lawyer who can assist you with your mortgage agreement. Private lenders can include small lenders, friends or family members lending to relatives to help loved ones or friends purchase a home, or small businesses issuing a private mortgage for business property or real estate. When dealing with private mortgage transactions, it is important to put emotions aside and protect your legal rights. Whether you are issuing a mortgage in a real estate deal or are a friend or family member who wants to help a loved one buy a house, Legal Counsel, PA employs a mortgage lawyer in Orlando, Florida who can help you draft a sound contract that will protect your rights as a lender.
If you are purchasing a home in Orlando, Florida, your mortgage will probably be the biggest loan you will ever have in your life time. Before signing on the dotted line, it is important to protect your rights. Legal Counsel, PA employs a mortgage lawyer in Orlando, Florida who can read over your mortgage agreement, help you understand the legal terminology, and help you understand your rights and responsibilities. When dealing with a private lender, the private lender may be using their own mortgage agreement, and borrowers should assume that this contract is designed to protect the rights of the lender. Borrowers can protect their rights by having a mortgage lawyer in Orlando, Florida review their mortgage agreement before signing it. Have questions? We have answers. Contact Legal Counsel, PA at 407.982.4321.
What is a Mortgage?
A mortgage is a legally binding agreement between a lender (creditor) and an individual or entity where in exchange for the creditor lending money to the debtor, the debtor agrees to give a mortgage lien on the debtor’s property to secure payment of the debt. A mortgage loan is a specific type of loan that finances the purchase of a home. With a mortgage, the collateral is the home being purchased. Different mortgages may have different terms. The length of time a borrower has to pay the mortgage back can vary, though many mortgages average 15 to 30 years. Some mortgages may be made without a down payment and other mortgages may be made with a 20% down payment or other down payment amount. The interest rate amounts may vary. Some mortgages come with fixed interest rates and others come with variable interest rates.
As more consumers turn to private lenders to buy their first homes, private mortgages are becoming more popular. They offer an alternative for buyers who may not qualify for a mortgage from a traditional lender. Private mortgages can sometimes offer borrowers more competitive interest rates than traditional loans. However, if you are a friend or family member thinking of providing a loved one with a private mortgage, you may need to take steps to protect your rights. For example, not offering a competitive interest rate could lead to additional tax burdens for the lender. The interest rate may need to be competitive with market rates in order for the IRS to consider the mortgage a legitimate loan.
Real estate investors may also turn to private lenders to fund their real estate deals. Private lenders may be able to offer more competitive terms or they may be willing to invest in cases where large banks consider a venture too risky. If you are considering lending to a real estate investor, it is important that your mortgage contract be thorough and include all provisions to protect your rights should the borrower default. Legal Counsel, PA employs a mortgage lawyer in Orlando, Florida who can help you with your legal needs.
If you are signing a mortgage or issuing a mortgage, it is important that you are clear about the terms of the mortgage and understand your rights and obligations. Legal Counsel, PA employs a mortgage lawyer in Orlando, Florida who an assist you with drafting a mortgage contract or read over your mortgage before you sign it. Contact our firm today to learn more about how we can help you. Have questions? We have answers. Contact Legal Counsel, PA at 407.982.4321.
How a Mortgage Lawyer Can Help You Mitigate the Risks of a Private Mortgage
A private mortgage can carry higher risks for a lender. Borrowers may seek private mortgages when they don’t qualify for a traditional mortgage. Real estate investors may turn to private lenders when banks don’t extend mortgage loans. When lending money to friends or family, it is also important to keep your emotions out of it. Legal Counsel, PA employs a mortgage lawyer in Orlando, Florida who can help you understand your risks and write contracts to best protect your rights.
What are some risks of private mortgages? If you have a family or friendship relationship with the borrower, it is important to make sure that the loan is documented in writing and that it is clear that the loan is not a gift. Having a sound mortgage agreement in place also protects you because you can always foreclose should the borrower fail to repay the debt. When it comes to issuing a private mortgage, there are also steps you may need to take to ensure that the property’s replacement value is secure should the property suffer certain types of losses. Banks take steps by requiring lenders to have homeowner’s insurance and by requiring borrowers to put their tax payments in escrow. Another way banks protect their investments is by performing title searches on the property being mortgaged to ensure that there are no other liens or claims. Legal Counsel, PA employs a mortgage lawyer in Orlando, Florida who can help you with not only your mortgage agreement, but with other steps a lender should take to protect their rights. Have questions? We have answers. Contact Legal Counsel, PA at 407.982.4321.
For example, a title search can tell you:
- If there are liens against the property.
- What the liens are for and for how much.
- If anyone other than who you assume is the owner has any rights to the property.
- What type of title the property has.
- All recorded matters effecting title to the property (ie: easements, restrictive covenants, etc.)
Why is doing a thorough title search so important?
If you were to purchase a property without doing a title search, you could get stuck paying liens or debts against the property that the previous owner acquired. You may have to contend with another person trying to collect mineral rights on the property. Additionally, you may have someone else claiming legal title to the property (other than the seller). It’s crucial that you have a qualified attorney thoroughly vet a home’s title before you sign on the dotted line so you can protect your interests. For a lender, a thorough title search and title insurance protects your claim to the title of the property should an issue with the title arise. Have questions? We have answers. Contact Legal Counsel, PA at 407.982.4321.
Why is a lender’s title insurance policy important?
Title insurance covers events relating to the title that has taken place prior to the date and time of the recording of the mortgage. For example, if there is a lien for taxes against the property that the previous owner didn’t pay, then those taxes typically would be covered under a lender’s title insurance policy. Although it’s important to do a title search on a property, sometimes things can arise after a search takes place. Title insurance is issued to protect you from unforeseen issues with a property’s title.
What else can title insurance policies protect against?
- Incorrect names on the title.
- Outstanding mortgages
- Judgments on the property
- Tax Liens
- Incorrect notary acknowledgments.
Legal Counsel, PA employs a mortgage lawyer in Orlando, Florida who can assist you with a range of issues that can arise when issuing a mortgage, from performing a title search, to drafting a mortgage contract, and helping you with promissory notes and other instruments. Contact our firm today to learn more about your options and rights under the law. We can help you draft sound contracts. Have questions? We have answers. Contact Legal Counsel, PA at 407.982.4321.
What Should be Included in a Mortgage?
If you are a private lender issuing a mortgage, what should be included in the mortgage agreement? When banks lend money, they use contracts that they have carefully vetted through lawyers and may have teams of lawyers reviewing their mortgage agreements. Smaller private mortgage lenders should also consider getting legal counsel as well. Legal Counsel, PA employs a mortgage lawyer in Orlando, Florida who can review your mortgage agreements to ensure that it has the minimal essentials, like:
- The names of both parties—the lender and the borrower.
- The principal amount being borrowed.
- The interest rate. There are different types of structures. For example, will your loan be a variable interest rate loan or a fixed interest rate loan? How will interest be calculated and applied?
- Monthly payment amounts.
- Payment methods.
- Consequences of late payments and foreclosure.
- Prepayment penalties, if any.
These are just some details that should be included in a valid mortgage agreement. While it might be tempting to use a template from the internet, it is important to remember that issuing a mortgage comes with serious obligations. Consider seeking the advice of a mortgage lawyer in Orlando, Florida before lending money to friends, family, or business associates. Have questions? We have answers. Contact Legal Counsel, PA at 407.982.4321.