In a sale of real estate, generally, a chattel is property that is not permanently attached to the land or building, and can be moved. Conversely, a fixture is property that is attached to the land or building in such a way that its removal would damage or harm the land or building.
The way many Agreements of Purchase and Sale are worded is to force the parties to specifically identity those chattels that are to be included as part of the purchase, and those fixtures that are to be specifically excluded from the purchase. All other chattels not specifically listed are assumed to not be included, and all other fixtures not specifically listed are assumed to be included.
A problem arises in some cases with respect to classification of property as a chattel or fixture. A microwave oven sitting on a counter-top is a chattel. However, once that microwave becomes affixed to or forms an integral part of a kitchen cabinet system, it can become a fixture.
From the perspective of buyers and sellers and their agents, if you are not sure which category an item falls within, you should make your intentions clear in the Agreement of Purchase and Sale by specifically identifying the property in question.
With interest rates at historic lows, many homeowners have been thinking of refinancing their mortgages in order to take advantage of lower rates. However, if you are currently locked into a closed, fixed rate mortgage, you should be aware of a potentially large charge imposed by some lending institutions for prepaying a mortgage loan before the end of its term. This charge is often referred to as the Interest Rate Differential (“IRD”). Read the rest of this entry »
When a property owner dies, unless she held title to the property jointly with someone else, the Estate of the deceased would pay probate taxes based on the value of the property at the time of death. As a means of avoiding payment of these probate taxes, a property owner may consider adding an adult son and/or daughter to title as joint tenants with the property owner while she is alive. Upon the death of a joint tenant, the survivor becomes the sole owner of the property.
There are risks involved with holding title to property in this manner. Read the rest of this entry »
Many purchasers submit offers that are conditional upon things such as securing adequate financing, or the receipt of a satisfactory home inspection report. These types of conditions are often structured such that unless the purchaser gives notice in writing of a waiver or fulfillment of the condition, before the deadline for expiry of the condition, the offer becomes null and void and the deposit is returned to the purchaser.
From a purchaser’s perspective, there are two important points to keep in mind with these types of conditions: Read the rest of this entry »
With the cost of buying a house these days, it is not uncommon for parents to assist their children in the purchase of a home. Historically, such loans are secured by mortgages which call for no interest payments and for the principal to be payable on demand. In many cases, it is the intention of the parents to ultimately forgive the loan but the mortgage is registered to protect the child in the event of separation, divorce, or adverse financial circumstances.
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