Chapter 28: How To Buy a Home

I. Equity: the difference between the amount you owe and the market value.

Advantages of buying a home:

1. Equity (value)

2. Dwelling

3. Tax Deductions

4. Its yours- do what you want

5. Private Property

II. Steps in Buying a Home

1. Determine how much you can afford

–Mortgage Payment: 28%

–Monthly Debt: 36%

III. Factors that determine loan approval.

A. Income/Work Experience

B. Credit Score (750 excellent, 690- great, 650-fair, 600-high risk)

C. Source of the down payment

D. Value of the Property (Apparel)

4. Down payment- Required down payment is 20% without any need for mortgage insurance

IV. The Purchase Agreement.

-once a bid has been accepted, with all the terms listed (price, time to close, exclusion of property, down payment), both parties enter into a legal contract. “In Contract”

1. Mortgage costs (closing costs)

A. Application Fee 1%

B. Appraisal Fee 500

C. Credit Report 250-500

D. Engineer’s Report 800

E. Attorney’s Fees 2,000

F. Bank’s Attorney 600

G. Title Insurance 3,500

H. Survey Fee 2,000

I. Termite Inspection 200

J. Homeowner’s Insurance 2,500

K. Taxes Paid (6 months) 6,000

L. 1 Point 4,000

22,350+ Closing Fees

“Closing The Deal”

1. Final Walk Through:

Escrow: third party bank account.

5,000 to be held in Escrow

2. Taking Title

-Tenancy in Common

-Joint Tenancy

-Tenancy by Entirety- married, all ownership goes to surviving spouse

Deeds

VI. Special Types of Living

1. Mobile Home- no deed

2. Cooperative- apartment complex shared ownership 60/40%. Any decisions to change must be approved by the co-op board.

3. Condo- communities or development individually owned- shares in fees for common areas. HOA fees.

Bequest: to express the clear intention of the disposition of an estate to a beneficiary.

Beneficiary: anyone legally named in a will that will receive a benefit.

Heirs- anyone related by blood to the decedent.

II. Formal Requirements

1. Be in wiring

2. Be witnessed by at least 3 individuals who are not beneficiaries .

3. Oral? Yes: Nuncupative Will: in emergency situations (soldier at war) an oral will can be made distributing personal property only.

4. Handwriting: Yes, can be a holographic will. Transfers personal property only.

Chapter 27: Tenant and Landlord Relations

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Remedy Tenancy

Lease- contract made between tenant and landlord outlining all terms of the rental agreement.

Lessee- Tenant

Lessor- Landlord

Types of Tenancy

Tenancy- interest or the right to use real property.

Tenancy for Years- right to occupy property for a fixed period of time (1-99 years). Mostly used for business lease agreements.

Periodic Tenancy- rights to use real property that automatically renews itself after the agreed upon period of time has been established. Month to Month, Year to Year, Week to Week.

-Mostly used for consumer rental agreements where the agreement automatically renews itself at the end of the month.

Tenancy of Will- interest in real property for an indefinite period of time. (a relative stays at your home)

1. No written agreement

2. Termination of tenancy must follow each states statutes (eviction 90 days)

3. Must give proper 30 day notification

Tenancy at Sufferance- when a tenant wrongfully remains in possession of the premises after the agreed upon tenancy expires.

The Lease Agreement

Covenants of a Lease- promises or agreements made by landlord and tenant.

–General Covenants

–Decorations and Repairs- landlords not responsible for declaration responsible for repairs to make habitable (warranty of habitable-premise must have essential electric, water, heat..

–Assignment- remaining time of lease

–Subletting- a part of the terms of the lease

-Security Deposit

-Destruction by Fire

-Termination of the Lease- 30 day notice in writing

“Warranty of Habitability”

-premise must be essential

“Waste”- excessive damage to the property by the tenant. Security deposit may be held to pay for it.

Breach: Termination of lease by one party.

1. Failing to pay rent- tenant

2. Failing to provide services- landlord

Remedies

Eviction- the right to deprive a tenant of physical possession of the premises through a court order/ sheriff’s department.

-90 days to process eviction

-Disposition proceedings

-Summary proceedings

-Summary Ejection

Constructive Eviction- Remedy for the tenant- if the landlord deprives a tenant of the basic services such as water, electric, etc. and the premises become inhabitable, then constructive eviction can be filed by the tenant. The lease agreement will be terminate immediately and the tenant can leave with no monetary obligations to the landlord.

Habitability- purpose must be fit for human habitation. If the landlord  does not maintain the premises properly he/she could be sued for “Breach of Habitability”.

Rent Control- many communities are considered rent control areas. Rent is control under federal statutes and can not be increased over a certain amount each year.

Antidiscrimination Laws- can not refuse to lease to an individual due to the race, their religion, color, or nation of origin.

Tenants Responsibility- all dwelling space in the rental area.

Landlords Responsibility- Common areas, providing basic services, ensuring the dwelling is habitable.

Removal of Fixtures by Tenant

Fixtures- any type of personal property that changes to real property due to it be fixed in the dwelling. (light fixture, washer, stove) can not be removed unless replaced by similar fixture.

Chapter 26: Divorce

I. Annulment

-allowable age restrictions from each states

-intent to marry

-misrepresenting intent to have children

-concealing pregnancy other than from husband

-mental illness at time of marriage

-impotence

II. Divorce

A. No Fault Divorce “Dissolution”

*irretrievable breakdown

*irreconcilable difference

*irremediable breakdown

B. Adultery

C. Cruelty

D. Desertion

E. Alcoholism or Drug Addiction

F. Nonsupport

G. Conviction of Felony

III. Where can a person get a divorce?

1. Domicile

-Main place that you live and return to .

2. Residency

-Addresses that you maintain.

IV. Alimony

-Funds allocated by the courts for spousal support.

–spouses income

–length of marriage

–lifestyle

–health of the spouse

V. Property Distribution

1. Community Property Distribution:

-All marital property is divided equally. 50/50

2. Equitable Property Distribution:

-Judge determines the FAIR distribution of property based on the individuals.

VI. Child Custody / Child Support

1. Types of Custody

A. Sole Custody

-All decisions regarding children are made by the custodial parent. Noncustodial parents input is considered only.

B. Joint Custody

-Parent legally apportion the custody of the children. both parents have rights to make decisions. One parent must have residency of the children.

C. Shared Custody

-Parents equally share custody and residency.

2. Child Support

-The Non- custody parent must provide financial support for his/her children. NYS is 10% of gross pay per child.

Chapter 25: The Marriage Contract

-Lifelong Contract

-Bilateral Contract

Benefits or Rights: -Right to support -Right of inheritance -Right to property

-Right to compensation

-Right to joint tax returns

II. Written Agreements in Marriage Contract Prenuptial or Ante nuptial agreements are agreements made by the two spouses outlining conditions of the marriage regarding property or any intangible item of wealth. Item’s include:

-Rights to buy, sell, manage, and control real and personal property.

-The creation of a will.

-Ownership and benefits of life insurance policies.

-Rights and obligation of the parties to any property owned individually or by both.

-The disposition of real and personal property upon separation, divorce, or death.

-The change or elimination of support.

II. Marriage Formalities/Restrictions

Common Law Marriages allowed legal marriages without a ceremony/license. Only 13 states recognize these marriages as legal and not contrary to public policy.

-Parties must agree, by words in the present tense, that they are husband and wife.

-The parties must cohabit.

-Parties must hold themselves out to the world as husband and wife.

Divorce must be used to end a common-law marriage

-Age Requirements- Common Law stated that the “age of consent” for a male was 14 and a girl 12. Anyone under 7 was not allowed to marry. These contracts would be considered void.

-Modern Law- The 26th Amendment enacted in 1971 allowed individuals to marry without consent at the age of 18 (male and female).

II. Marriage Requirements

-Ceremonial Marriage- marriages must be solemnized by a religious or state authority.

-Marriage License- Under the Uniform Marriage and Divorce Act licenses must be applied for in order to legalize a marriage. (page 371)

-Waiting Period- in order to give time for anyone who opposes the marriage a waiting period exists after the marriage license is submitted. It varies from 24 hours to 7 days. Formally known as wedding banns.

-Blood Test/Physical Exam- in order to prevent the spreading of disease, some states require blood testing as a part of the marriage license.

-Proxy Marriage- anyone unable to attend the solemnization of his/her marriage can appoint another individual to represent them.

-Use of Maiden Name- only based on tradition, wife may choose to keep her maiden name or take on her spouses name.

Consanguinity: related by blood.

-Mother and Father

-Grandmother/Father

-Daughter or Son

-Grandson/Daughter

-Aunt or Uncle

-Sister or Brother

-Niece or Nephew

Affinity: related through marriage

-Stepmother or Father

-Stepgranmother/Father

-Mother/Father-in-law

-Daughter/Son-in-law

Chapter 23: Employment Law

“Off the books”- no taxes, cash, higher wage, more flexibility Disadvantages- injury, 401K, no benefits, Social Security, I. The Employment Relationship- A. Are Formed: 1. Oral Agreements. 2. Written Employment Contracts. -Specific negotiated contract between employee (professional) and employer. Legal agreement.

“Employment at Will”- can be terminated at any time by employer.

Exceptions- Prove “Unjust Dismissal”

1. Public Policy- dismissal based on discrimination or due to an individual who is obeying the law.

2. Implied Contract- A promise made by an employer that the employee relied upon. “Promissory Estopped”

–> Disclaimer – (in employee handbook)

“Promises made are not enforceable”

3. Implied Covenant- Implied promise that employees will be treated fairly- not abused or cheated.

Restrictive Employment Contracts

Trade Secrets

Employment Legislation From the 1900’s

1. National Labor Relations Act 1935

Wagner Act- 1st Collective Bargaining Agreement (Unions)

-Established National Labor Relations Board

2. Taft Hartley Act of 1947

-provided too much power to union

–60 day cooling off period- president could order union workers back to work during a strike

–Closed Shop- illegal

–Union Shop- providing an option to join the union

Feather bedding outlawed

When Union assigns more than a reasonable amount of workers to a task

3. Londrum Griffin Act of 1959

– Labor Management Reporting and Disclosure Act of 1959

-Made Uniona more accountable through the periodic regulation of all of their financial records

Judge Judy

Case: Two boys stole things out of a female’s wallet

Plaintiff: The boys took all the items out of her wallet and stole them. (ID’s, Giftcards, Earpiece, Calculator)

Defendant: There was no earpiece in there .

Decision: The boys were to pay 500 to the woman for stealing her items in her wallet.

Case: Whether defendant would have to pay 411.00 as expenses for a broken item during a bb gun demonstration

Plaintiff:The man authorized the shooting of a BB gun in his yard for demonstration, somebody demonstrated and broke an item after he gave permission so he should be liable.

Defendant: He didn’t break it, the guy who demonstrated did therefor he believes that he should pay

Decision: Defendant had to pay 411.00 to the plaintiff, judge judy saw it in the plaintiff’s favor.

Chapter 19: Personal Property and Bailments

Personal Property: Anything that can be owned, which can be moved= personal property.

1. Tangible PP- any property that can be touched

2. Intangible PP- Intellectual Personal Property -Thoughts, ideas, visions, imagination, creativity -Photographer, Author, Artist 1. COPYRIGHTS 2. PATENTS 3. TRADEMARKS

II. Possession of Personal Property A. Gift of Personal Property- can not be taken back

*Requirements of a gift: 1. Intent of the donor.

2. Must be delivered. 3. Donee must accept it.

B. Lost Property- Property that is found in a public or common place Finder has a legal responsibility to search out the owner.

Rewards for Lost Property- Only entitled to a posted reward when you had previous knowledge of the reward. C. Misplaced Personal Property- Property that is found in an establishment. “Lost and Found”- Must be held for a period of time (60-90 days minimum) before the ownership or possession can be transferred.

III. Intellectual Personal Property

A. Copyright- an original work that is fixed in a permanent medium of expression. (author, composer, photographer, artist, etc..) Copyright Infringement violating the exclusive rights to use and sales of an original work.

copyright infringement -violating the exclusive rights to use an sales of an original work

1. How Long Does Copyright Last?
2. – Life of the artist + 50 years.

– Copyrighted material may not be reproduced without written consent.

-US Copyright and Patent office to register your copyright. 2. When Is Copyright Infringement Allowed?

– Education – Charity (possibly) – Research (ex. medical research and scholarships) – News Reporting

Patents – The exclusive rights granted by the federal government to make, sell, or use an invention.

-Lasts from  17 years -New principle or idea -Purpose of function -Diagrams/Illustration/Prototype

Trademark- a mark, symbol, slogan that legally identifies a business.

Bailment- the possession and use of one’s own personal property for a specific purpose.

A. Bailee- party that takes possession of the bailor’s personal property

B. Bailor- party that gives up possession of personal property

1. Mutual Benefit Bailments

Bailment:

Service or Repair–Bailor- Owns the item to be serviced or repaired.–Bailee- Performs the repair or service work.

Storage or Parking–Bailor-Ons the item to be stored or parked.–Bailee-Is responsible for the storing or parking.

Security for a Loan–Bailor- Pledgor, debtor-borrows money.–Bailee-Pledges, creditor-lends money.

Renting or Leasing–Bailor- Rents an item to someone–Bailee-Pays to use an item.

Bailments by Necessity–Bailor- Gives up possession of property–Bailee- Accepts or protects the property

2. Bailment for the sole benefit of the bailor and bailee

II. Rights and Duties in a Bailment

Bailor’s Rights

-have property protected from harm.

-property must be returned when payment is made.

-property only used for contracted service.

B. Bailor’s Duties

-Pay for costs

-Warn the bailee of any danger associated with personal property.

-Pickup your property in a reasonable time frame

C. Bailee’s Duty’s

-Degrees of Care:

a. Great Care

b. Ordinary Care

c. Slight Care

language of he law and review chapter 16

LANGUAGE OF THE LAW AND QUESTIONS FOR REVIEW

1) Warranty of Title

2) Warranty

3) Express Warranty

4)Limited Warranty

5) Merchantable

6) Full Warranty

7) Implied Warranty

8) Warranty of Fitness for a Particular Purpose

9) Guarantee

10) Warranty of Merchantability

Questions for Review:

1. Express warranties is an oral or written guarantee and an implied warranty is the law.

2. Titling written titles as full or limited, stating terms and conditions of your written warranty, making warranties available prior to sale

3. Implied warranty of merchantibility, implied warranty of fitness,Implied warranties are provided by the fed, and they always apply unless excluded by the seller

4. a warranty of title gaurantees that there are no other owners of the item, and that the title is clean of any leans or previous ownership

5. Warranties may be excluded by the seller if they are expressly written and only if it conforms to the magnuson moss warranty act.

6. They must address the seller within a reasonable amount of time to either get a refund or get the product replaced with a new one.

7. exchanging the goods for conforming ones, returning the goods and recieving a refund, keeping the goods and claiming damages– the difference between tthe value of the goods retained and the value they would have had if they had been as warranted.

chapter 16 – warranties

CHAPTER 16: LAW OF WARRANTIES

THERE’S NO DIFFERENCE BETWEEN WARRANTY AND GARANTEE

A garantee by the seller or the manufacturer that a good or service id not defective.

Types of Warranties:

Implied: Ordered by the federal government. both merchants and non-merchants are bound by implied warranties

1)Warranty of fitness for a particular purpose

– buyer is relying on seller’s words that the product of service does what it’s intened to do.

2) Warranty of Merchantablility

– good must be what is in the description

-fit for ordinaray use

-must conform to statements or promises made on packaging

Recall

Express: An oral written garantee by a manufacturer or seller.

1)by a statement of fact or promise made by the seller

2) description of the goods

3) the sue of sample or model.

Full Warranty: A defective product will be fixed or replaced free within a reasonable time after the complaint has been made about it.

Limited Warranty: A warranty that provides restricted protection.

Warranty of Title:

– Assurance of the ownership of the good being sold.

Privity of Contract Not required:

– A seller’s warranty extends to the buyer and the buyer’s household and family.

Exclusion of Warranties:

-A seller can exclude warranties but it needs to be written and the buyer needs to be aware of this

Duty to Notify and Remedies for Breach:

-In order to recover money damages for breach of warranty, the buyer must notify the seller within a reasonable time after the defect is discovered.

-when a defect is found in the good the seller will usually:
1. arrange to repair the defect
2. exchange the good
3. refund the buyer

Chapter 17: Consumer Protection

Caveat Emptor (Latin) let the buyer beware “then ”

Caveat Venditor “Now” let vendor on the merchant, beware

FTC-federal trade commission was entered to develop and enforce consumer protection

UCC-uniform commercial code

1.Consumer protection

-laws created to protect consumers from faulty merchandise and dangerous merchandise, fraud, deception, faulty advertising, mail order fraud and the enforcement of warranties

2.Unfair and deceptive practices

1.Deceptive Pricing

2. Fraudulent Referral Schemes- special discounts money offers if you can refer a list of potential sales to the merchant

3. Deceptive Service Estimates- all costs associated with any service repair MUST be expressed and authorized by the customer.

4. Door to Door Sales- due to the pressure of door to door sales, the FTC under the UCC, states that the consumer has three business days to cancel the order.

-Salesperson MUST under FTC rules explain all of their rights including cancelation.

-Under FTC rules seller must be provided the following within 10 days:

1. Return any papers to the customer

2. Refund

3. To pickup any left products

4. Return any trade-ins

“Cooling Off Rule”

5. Fraudulent Misrepresentation

A. any false statements made by the seller that deceives the buyer.

-Durability/Construction

-Reliability

-Safety

-Strength

-Life Expectancy

IV. False Advertising

The FTC regulates all advertising on the national level. The FTC has the power and authority to issue a “cease and desist order” to anyone who misleads the public.

1. Advertising of Guarantees:

A. The product or service that is specifically guaranteed.

B. Time limit for the guarantee.

C. How to make a warranty claim.

D. How claims are settled.

E. Identification of who is making the warranty.

2. Advertising of Consumer Credit

“No money down” “no payments till 2016”

A. when a merchant advertises consumer credit offers they must disclose all information:

1. Interest rate.

2. Credit score needed.

3. Any additional financial requirements .

B. Open end credit: credit card.

C. Closed end credit: installment loan .

3. Bait and Switch Advertising

-Alluring but insincere invitation to customers to buy a product or a service that the seller had no intentions of selling

1. Refused to show product advertised.

2. Discouraging the purchase of a product.

3. Claims that product is out of stock.

VI. Product Liability Laws: Manufacturers are responsible for the safety of the products they put to market.

1. They are responsible even if:

A. The manufacturer was not negligent in the care or preparation of the product. (Strict Liability)

B. The person who bought it was not the injured party.

2. How to Prove Product Liability.

A. Was sold in a defective form.

B. Was reasonably dangerous to users.

C. Defect actually caused the injury.

D. User sustained injuries.

3. Mitigation of Damages- “remedy”

Safety Recall Notifications.

VII. Food, Drug and Cosmetic Act.

-FTC-Follow FTC Safety Regulations