All posts by James London

Texas residents fighting the government for Red River land

Real Estate Disputes

Land disputes can be complicated, but when you’re fighting the government, it might help to have some Washington politicians on your side. Texas land along the Red River has some Texas politicians concerned that a potential “land grab” may be in play from the Bureau of Land Management. Senator Ted Cruz, Governor Rick Perry and Attorney General Greg Abbott are trying to protect Texas citizens’ claims to 116 miles of land along the southern border of the Red River.

The BLM claims that the government has owned the land since the Louisiana purchase in 1803. A spokesperson for the agency also alleges that the U.S. Supreme Court confirmed their ownership of the land in the 1920’s. However, Texas citizens have allegedly been paying taxes on the land and developing it as their own for years.

The gray area in this real estate dispute is around the boundaries. Red River runs between the Oklahoma and Texas border, with the middle of the river designated as the state line, per the Supreme Court decision in the 1920’s. The land owned by the government was supposed to encompass anything “between” an area north of the invisible state line — in Oklahoma territory — to cut-out banks on the Texas side. However, with normal erosion and changes in the river over the years, the river’s location is altered, and it is now uncertain who owns what.

In 1986, a dispute between Oklahoma and Texas ranchers included one Texas man who had purchased 140 acres of land for $300,000. In his case, the government’s claim was upheld by the courts, and the man lost his land.

In regards to the Red River real estate, the BLM is in the process of planning use for the land. The planning process began last year. It is unclear whether any legal action will take place between the Texans and the BLM over the land at this point. A lot of complaints have been coming in according to an Oklahoma land office agent.

However, for a real estate dispute to take place, a citizen will have to file a legal action. Their attorney will need to be very thorough in researching and preparing their case. They will no doubt have to research the past documented land and river boundaries, as well as provide current boundaries and proof of ownership of the land.

Source:Dallas News, “Red River land dispute echoes Cliven Bundy fight in Nevada” Nick Swartsell, Apr. 30, 2014

Estate planning is important for all Texas residents

Estate Planning

Did you know the state of Texas puts a will in place upon a resident’s death if there is no other estate documentation on file? The state will may not match your desires when it comes to dividing assets or passing property on to heirs. Estate planning is the best way to ensure your wishes are followed and is important even if you aren’t considered wealthy.

Many people avoid creating wills, trusts or other estate documents because they don’t feel they have a great deal to pass on to others. In reality, everyone has something to pass on, and estate planning can cover items and assets such as tangible personal property, bank accounts, Social Security benefits and pension payments. From family heirlooms to mineral rights, it’s important to draft estate planning documents that clearly define your wishes for disbursement.

Some individuals consider a basic will to be all the estate planning they require. Experts say there are some important questions involved in the estate planning process that may lead you to create more than a simple will. For example, individuals with young children should consider who would take care of kids if one or both parents died suddenly.

Other questions to consider are about your own health and capability. It’s common to consider power of attorney and other options for later in life, but what if you’re involved in a car accident that leaves you unable to care for yourself and your finances? Estate planning ensures a trusted person is in line to handle your affairs.

Some individuals create estate documents to avoid complications and probate. A clear, legally solid document reduces the risk of contests and the expenses associated with disputes or probate court. Understanding the legal needs for each document help you establish the strongest chance your wishes will be followed.

Source:The Dallas Morning News, “Everyone needs an estate plan, regardless of wealth” Pamela Yip, May. 02, 2014

Reducing credit card debt in Texas can avoid future bankruptcy

Foreclosure

While the last ten years have proven to be an economic nightmare for homeowners and credit card users, the state of Texas, like most of the nation, is starting to spring forward in a slowly growing housing market. As the economy shows signs of recovery, many Americans are looking to invest in a home. There are many factors on the laundry list to consider, especially if children are in the picture. A good location, successful school district, the number of bedrooms one should have — these are all important. But one often-forgotten point involves debts incurred on credit cards.

According to a 2013 survey by the Consumer Federation of America, banks and lending institutions scrutinize credit scores when an applicant applies for a mortgage. It is not too soon to anticipate potential credit-score issues before you begin your housing-hunting adventure. There are ways to improve your credit.

The credit card reporting agencies are not infallible. They make mistakes. Request a copy of your credit score from all the agencies and go over it with a fine-tooth comb. Your lender may pull all three versions and study them.

Another common sense strategy is to reduce your credit card spending. Lenders will frown upon high debt-to-income ratios. Don’t spend more than you make. Especially during the loan application process, be prudent about posting charges to your cards. You can buy that boat after your house loan finalizes.

Another good tip is to stay well below your spending limit. Just because your Discover card has given you a $3,000 limit, you don’t have to use it. A guideline is to keep your amount under 30 percent of the allowed maximum.

Property is still affordable in Texas. A prospective homeowner should take the time to speak to someone who can explain what his or her scores really mean. Why they are low and what one can do to raise them may involve time and dedication. Legal and financial professionals can assist you as you contemplate entering a decision that will keep you on a steady path. It is a move that can affect the rest of your life.

For some, however, bankruptcy may be the best option, as it provides a fresh financial start. Many people have too much debt to overcome on their own, and bankruptcy may provide a needed solution.

Source:El Paso Online, “The do’s and don’ts, how to prime your credit score before you house hunt” No author given, May. 01, 2014

Know your rights: reverse mortgage, foreclosure, and inheritance

Foreclosure

Losing a parent can cause incredibly powerful, sometimes debilitating emotions. At the same time, you know that there are a lot of different things you have to take care of. Handling your parent’s estate is one of those things. Unfortunately, if your parent had a reverse mortgage, time might be working against you.

The reverse mortgage program allows people who are 62 and older to access the equity in their homes to make life easier for them as they age. Under the program, the person’s heirs are supposed to be able to settle the mortgage for a percentage of the current market value. Many heirs are discovering that not all reverse mortgage companies are adhering to that portion of the program. Others are discovering that the reverse mortgage is underwater.

Some heirs are reporting that reverse mortgage lenders are seeking a foreclosure on the home within weeks of the homeowner’s death. Sadly, not all heirs know their rights when it comes to reverse mortgages. In some cases, that lack of knowledge will lead to them losing the home their parent owned.

One important point for Texas residents to remember is that the reverse mortgage company has to give you up to 30 days to decide what you want to do with the home. If you want to keep it, you are allowed up to six months to find financing. Also, remember the 95 percent rule. Lenders have to allow you to buy the home back at 95 percent of the current market value. If you are dealing with a parent’s reverse mortgage and a potential foreclosure, getting answers to any questions you have and learning your rights might help you to keep the home.

Source:El Paso Southwest Senior, “Bitter inheritance” Jessica Silver-Greenberg, May. 01, 2014

Heirs have options with investing assets

Heirs & Beneficiaries

Texas residents whose spouses predecease them and leave them an individual retirement account may be confused about the best way to protect the asset from penalties. The key to deciding what to do with the money depends on the age of the deceased and that of the surviving spouse.

There are two basic decisions to be made — to shift the money into an inherited IRA and keep it as a tax shelter or to roll the funds into a separate individual IRA.

According to a technical consultant, when deciding what to do, consider age. If the survivor is younger than 59 1/2 and the deceased spouse died before making 70 1/2, and the money is needed, it is better to remain a named beneficiary. Rolling the money into his or her own IRA and making any withdrawals will incur 10 percent penalties until the age of 59 1/2. Remaining a named beneficiary will allow the survivor to make withdrawals as needed without penalty, but the IRA must be retitled as an inherited IRA.

The decision made can impact the next generation of heirs. When the surviving spouse rolls the IRA into his or her own, beneficiaries can factor in their own life expectancies when taking distributions as they, in turn, inherit the money. Beneficiaries are able to stretch out the distributions over the period of their remaining lives if it is kept as an inherited IRA.

A Georgia consultant stresses that the surviving spouse is “not locked into that option,” and may roll the funds into a separate account at a later date.

If the survivor is younger than 70½ with no pressing need to access the money, it’s generally a good idea to go ahead and make the IRA solely his or hers. The minimum distributions won’t begin until the minimum age requirement of 70½ is met.

If the original owner of the IRA died prior to having to take the minimum distributions, spouses who are named beneficiaries won’t have to begin taking disbursements until the time the late spouse would meet that age criteria had he or she lived. April 1 is the “required beginning date” in the year after the owner reaches the 70 1/2 milestone.

Don’t wait until the death of a spouse to sort this out. An estate administration attorney can explain your options to you at a time when you are not under stress and grieving.

Source:DailyFinance.com, “When a Spouse Inherits an IRA” Rachel L. Sheedy, Apr. 22, 2014

Texas elderly now providing end-of-life directives, wills

Will Execution

Recent events in the medical community indicate that people are beginning to view passing into the afterlife with considerably less distaste than in previous years. Such trends are evident in Texas as well as across the nation.

The number of elderly individuals who have drawn up a will in the last few years has almost doubled. These trends have not had an effect on hospitalization in the past.

Documentation regarding end-of-life care may be considered a way to allow that a person’s final wishes are respected. It also indicates an increasing desire for an individual to discuss his or her passing with family and loved ones.

One case that made headlines in Texas was the widely-discussed case of a pregnant woman who was brain-dead, but had to be kept on life support due to conflicting opinions over how to interpret state law. The court finally ruled to respect the family’s wishes to disconnect her from the ventilator.

While medical personnel is encouraged to discuss end-of-life directives with their patients, there continues to be little effect on the hospitalization of the patient or possibility they will die at their homes. On the other hand, many physicians are of the opinion that it is critical to consider family dynamics and cultural factors before having this type of discussion.

An advanced directive, as well as a living will, allows you to communicate your wishes as to how you envision your future medical care. In the event you cannot effectively manage your estate planning or your final wishes in the state of Texas, you may issue a physician directive, power of attorney, or other provisions that enable you to involve professional assistance in making your wishes known. It is to your advantage to consult with an entity that can walk you through the process of clearly communicating your final wishes, so as to make sure you pass to your final resting place with peace of mind.

Source:News Medical, “Study: A record number of elderly people are completing living wills to guide end-of-life medical treatments” No author given, Apr. 03, 2014

Protecting your family farm for the next generation

Will Execution

Texas farmers and ranchers often pass down their land and occupation to their children. This is their legacy. However, protecting the family legacy to ensure that you are making the most of it takes planning.

An economic development consultant says, “When it comes to planning versus no plan, it’s an easy decision.” He also points out that you have two choices: either you decide what happens to your children’s legacy or the court decides.

Divvying up farm or ranch property for your children is usually more complicated than just drafting a will. Sometimes there is one child who is more interested in working a farm and continuing the legacy than another child. You may want to gift some of the farm or assets to them while you are still alive. At some point, one generation may want to retire from maintaining the farm and start the next generation on another path.

One way of dividing up a farm or ranch business to pass it along to heirs while you are still living is to set up the family business as a legal entity like an LLC. This way, you can divide it up by shares. Whoever owns over 50 percent (51 percent or more) of the shares is in control of the entity, so if you want to remain the controller, limit the shares you portion out. Your shares can then be willed to whomever you want to take over after your death.

The economic development consultant also recommends good communication between family members and getting advice from outside trusted parties. You want to be as fair as possible to your heirs if you intend to keep harmony in the family. Discuss your estate planning and wills regularly with your legal and financial advisors to see if changes are in order. In addition, don’t neglect to determine the tax implications before embarking on any legacy estate planning decisions.

Source:Agri-View, “Legacy planning addresses family issues, even health care” No author given, Mar. 31, 2014

Disabled vet charity under fire in Texas

Estate Administration

A crime victim advocate and former prosecutor has requested that the Harris County District Attorney’s office look into a disabled veteran charity’s financial records after some veterans alleged shabby treatment by the organization and broken promises.

A blind veteran who died last year was living in a home that he had gotten with assistance from the charity and his own contribution of $50,000. The charity tried to take the home back after his death from cardiac arrest by using a buy-out option stating that if the vet died within 10 years of taking possession of the home, the charity could buy it back for the $50,000 veteran contribution cost.

However, the veteran’s family filed suit against the agency, saying that the buy-out option was invalid. The vet’s father held his son’s power of attorney but was not present when his son signed the papers. Due to his blindness, the former Army specialist was unable to read the provisions of the contract. The father also alleges that the reported $250,000 value of the home was inflated from the $170,00 listed on the contract. The agency had also promised to make the home accessible for the blind, yet failed to do so.

The family hired an investigator to review the charity’s financial records, but the administrators of the charity refused to allow him access. After being contacted by the Harris County District Attorney’s office, the charity administrators agreed to comply with Texas law that states the public may have access to their financial documents.

After the death of a loved one, relatives are saddened and often stunned and not thinking clearly. An estate attorney can review all documents pertaining to the estate of the deceased to insure that everything is in order and take the necessary steps to remedy any improprieties.

Source: Houston Chronicle, “Questions raised about Houston charity that builds homes for veterans” Cindy Horswell, Apr. 08, 2014

Texas buyer wants deposit back in real estate dispute

Real Estate Disputes

Real estate transactions have been tricky in many southern states since the economic slump of 2008. Texas has not been the only state to fall prey to real estate property disputes.

A real estate company previously affiliated with Prudential has filed a suit against Regions Banks of Alabama and a resident of Texas in the Orleans Parish District Civil Court. At issue is a $50,000 deposit and a buyer who changed her mind.

A Texas woman agreed to purchase a property on Prytania Street, New Orleans, for $1.6 million. She then signed an “Agreement and Counter Offer” transaction.

The suit claims the broker and listing agent came to an arrangement with the buyer and the $50,000 deposit was delivered by the buyer’s agent. The property closed on the predetermined date, but the broker was later informed that the buyer would not go through with the sale.

Since then both the bank and the buyer have requested the funds be released, but the real estate company considers the funds to be in dispute. The representative for the real estate company has requested that the court hold on to the funds, less the costs of filing, and has asked to be dismissed from the case.

The bank feels that the buyer reneged on her obligation to purchase the property, as per the real estate agreement and counter offer. They claimed the buyer agreed to make the purchase and was aware of the closing date. The bank states that the contract allows them 10 percent of the purchase price, or $160,000, and the right to retain the disputed funds.

Real estate transactions are complex in Texas, as in other states. There is a great deal at stake for the buyer and the seller, as well as the for lending institution. In the mountain of paperwork to be filed, sometimes a purchase dispute arises. It is advisable for all involved in real estate transactions to have the guidance and expertise of a seasoned individual or entity, that is well-versed in real estate law. It is in your best interest and will help protect your rights and your understanding of what you are signing.

Source:Louisiana Record, “Real estate company asks to be released from responsibility of $50K deposit dispute” Lizzy Fitzsousa, Apr. 02, 2014

Avoid ‘do it yourself’ estate planning in Texas

Estate Planning

El Paso readers, like most, like to save money by doing things themselves. But there are a few things that it might be worth spending money for a professional to handle instead of trying to do it yourself. Estate planning is one of those things.

Drafting estate planning documents is important, and there are too many mistakes that can be made if you are not well-versed in this type of law. Having a professional who knows the difference between wills and living trusts, guardianships and conservatorships, and other complicated estate planning issues can ensure that your will or trusts meet your needs and final wishes. Also, different states may have different laws that could affect how you plan asset distribution.

If you move to a new state, you should have your estate planning documents reviewed to ensure they meet the new state laws and, thus, will still be upheld. Some things that you may want to pay attention to when it comes to different state laws are: asset protection, state taxes on property and assets, and whether your state is a community property state like Texas or an equitable distribution state. These things could have an impact on how you draw up your wills and trusts. Existing documents may need revisions.

You should also know the difference between a will and a living trust, so you can decide which would be best for you. While either a will or a living trust can be used for assigning or transferring property or assets, if you need to assign a guardian to minor children or dependents, you will need to do this through a will. If you are concerned about your assets and want to have them managed while you are still alive, in the event you become disabled for instance, you can use a living trust.

Source:Forbes, “Moving To A New State: How To Put Down Financial Roots” Deborah L. Jacobs, Mar. 19, 2014