Archive for October, 2011

THINK TWICE ABOUT ATTIC AND RAFTERS STORAGE!
October 30, 2011

A man in Michigan is suing his in-laws because he fell through their attic helping them retrieve Christmas decorations.  So we are using this opportunity to remind everyone most attics are built for one purpose – to hold up the roof.  The rafters and trusses are designed to support the weight of the roofing material.  They are not normally engineered for the weight of stored items.  Stressing the trusses, rafters, and joints beyond the structural integrity they were designed for can cause damage and ultimately failure of the roofing system.

Unfortunately, many people think that the attic and the rafters in the garage are great places to store stuff.   They often lay wood flooring in the attic and will install a ladder to create permanent storage space unconcerned with the weight of the items they store.  We have seen boxes of books and paper records, furniture and more stuffed into these spaces.

To compound the problem, homeowners often wish to promote an attic storage area as a feature of the house when they list it for sale. They don’t understand the potential future liability of promoting this illegal storage space in the event that the trusses are structurally compromised later by the unwitting buyer.

We recommend homeowners not to utilize their attics for storage; and when selling their home, never advertise it for that use.

Rich and Jan McMillen
www.TOHomes.com
 

WHEN IS A WIRE TRANSFER NOT A WIRE TRANSFER?
October 13, 2011

This was one of the easiest short sales we have handled until today

Last Monday our clients signed their loan docs so escrow could close Friday.  All they had to do was wire the rest of their down payment and closing costs to the title company.  Before leaving the office, the buyers were given the wiring instructions to give to their bank.

Being a techie and doing most of his banking online, he was used to sending wire transfers to family through the Bank of America website.  So as soon as he got to his computer, he completed the online form and felt comfortable that he had completed the task.  Unfortunately, what he actually sent was an ACH (Automated Clearing House) payment which is commonly called a wire transfer though that is not correct.

Though both ACH payment and the wire transfer are performed through the Federal Reserve Bank System, each is handled by different departments at a bank.  Also, a wire transfer is the movement of funds in real time.  Escrow usually has these “good funds” in a matter of hours so the transaction can proceed immediately.

The ACH payment is a batch-process; it is stored and forwarded for future settlement.  In other words, it takes longer (in this case three days) and they are not “good funds” as required by the title company.  Therefore, their wire was rejected today by the title company and sent back to Bank of America.

Our clients were told by a bank clerk that it could take up to a week for the funds to be put back into their account and then properly wired.  Unfortunately, that runs afoul of the deadline for closing as set by the conditions of approval for the short sale by the seller’s mortgage holder.

Following our advice, our clients went to their Bank of America branch and talked with the manager this time.  They were there for two hours as the manager not only talked to her ACH department, but the one at Union Bank (the title company’s bank).  She verified that the latter had received an authorization to return the funds which are to be transferred back tonight.  Once received, the funds will still need to be cleared through the electronic fraud department and reviewed, but there is now an escalation process in place.

The manager will be monitoring the situation tomorrow, and will execute the correct wiring instructions as soon as the funds are available.  At worse, this will push the closing until Tuesday, but we will still be on this side of the deadline date.

Rich and Jan McMillen
www.TOHomes.com