1. Contract Matters: Working Together to Negotiate Complex Transactions
Presented by:
Steven Ebert, Esq., Managing Member, Ebert Lontok, LLC (“EL”)
110 East 30th Street, 5th Floor
New York, NY 10016
Telephone:
Ebert Lontok
Attorneys-at-Law

2. Table of Contents
What are the Consequences of Default Under the Contract?
Pitfalls for Clients in the “Standard Form” Contract
Mortgage Contingency
Board Approval
Property Violations
Representing and Managing Investor Clients
Representing and Managing Foreign National Clients

3. The Contract Deposit & Default
How much for the Contract Deposit?
Customary
Minimum vs. Maximum
Risks to Purchaser
Risks to Seller
Consequential Damages
Specific Performance
Notice of Pendency

4. Mortgage Contingency-I
“The obligation of Purchaser to purchase under this contract is conditioned upon issuance…of a written commitment from an Institutional Lender pursuant to which such Institutional Lender agrees to make a first mortgage loan, [with certain terms] at the prevailing fixed or adjustable rate of interest and on other customary commitment terms.”

5. Mortgage Contingency-II
“To the extent a Commitment is conditioned on the sale of Purchaser’s current home, payment of any outstanding debt, no material adverse change in Purchaser’s financial condition or any other customary conditions, Purchaser accepts the risk that such conditions may not be met…”

6. Mortgage Contingency-III
Controlled Purchaser Risks:
Mortgage and HELOC
Sale of a Property
Credit Scores
Assets (Risk of Market Fluctuations)
Income
Uncontrolled Purchaser Risks:
Unilateral Bank Changes/Guideline Issues
Commitment Expirations
Bank Funding Failure
Last Minute Surprises

7. Mortgage Contingency-IV
Gaps of the Mortgage Contingency
Document Expiration
Project Approval Expiration
Interest Rate Lock Expiration (Concerns in a rising rate market)
Is a Funding Contingency Possible Solution?

8. Mortgage Contingency -- V
“Know Before You Owe” – CFPB 10/3/15 – New Concerns under the new mortgage laws (aka TRID)

9. Board Approvals Consent (Co-op) Right of First Refusal (Condo)
Who Submits the Application?
When is the Application Due? (Defined Days)
Approval vs. Unconditional Consent
How Much Time Must the Parties Wait for the Co-op to Act?
Right of First Refusal (Condo)
Who Submits the Application?
When is the Application Due? (Reasonable Time)
Waiver by the Condominium Board
What if the Condominium Board does not Act?

10. Property Violations
“Seller shall comply with all notes or notices of violations of law or municipal ordinances, orders or requirements noted or issued as of the date hereof by any governmental department having authority as to lands, housing, buildings, fire, health, environmental and labor conditions affecting the Premises.”

11. Investor Clients-I Choice of Entity Factors to Consider Liability
Individual
Partnership (General vs. Limited)
Corporation
Limited Liability Company (LLC)
Liability
Control
Taxation

12. Investor Clients-II Financing Taxation Mortgages Equity Partners
Income Tax of Rental Income
Deductions
1031 Like-Kind Exchanges
Primary Residence v. Second Home v. Investment Property (Status Conversions)

13. Investor Clients-III Rent Paid in Advance v. Security Deposit
Is there a Limit on the Amount of the Security Deposit or the Amount of Advance Rent a Landlord can Collect?
Security Deposits in Leases
Escrow Accounts
Who Keeps the Interest Earned?

14. Investor Clients-IV Property Type Specific Issues:
Condominium
1 to 4 Family
Rental Fees and Speed of Approvals
Ownership Concentration in the Project
Sponsor Competition
Property Management
Rehabilitation Projects
Should an Investor Ever Buy in a Co-op?

15. Foreign National Purchasers-I
Who is a “US Person”?
Are there any Legal Restrictions on Purchases of US Real Estate?
Funding the Purchase
Money Transfers
Mortgages

16. Foreign National Purchasers-II
Applying for an ITIN (Individual Taxpayer Identification Number)
Tax Status and Income Tax Payments
Property Management
Escrow Account

17. Foreign National Purchasers-III
Should a Foreign National Buy a Co-op?
What building rules should be checked.
Can a Foreign National be “Turned Down” on a Condo Purchase?

18. Foreign National Sellers
What do you Need to Know Before you List the Property?
FIRPTA – Foreign Investment in Real Property Tax
1031 Like-Kind Exchanges
ITIN (Individual Taxpayer Identification Number)

19. Contact Details
Steven R. Ebert, Esq Ebert Lontok, LLC East 30th Street, 5th Floor New York, NY Telephone: , ext Mobile: Facsimile: Website:

20. Personal Biography & Firm Profile
Steven Ebert has significant experience in real estate, finance and general business transactions and has received the Super Lawyers Magazine Award of Excellence in Practice in 2015 and He received his Juris Doctor from the University of Pennsylvania Law School, and also attained a Masters in Governmental Administration and a Bachelor of Arts, cum laude, both from the University of Pennsylvania as well. Mr. Ebert has represented purchasers, sellers, landlords and tenants in the acquisition and leasing of residential and commercial real estate. He has represented commercial and investment banks, credit enhancers, loan sellers and government agencies in the securitization of more than $5 billion worth of mortgage backed and other asset backed securities. Mr. Ebert has also participated in a variety of legal matters that included the formation of business entities, corporate governance matters and M&A transactions.
Prior to founding Ebert Lontok, Steven Ebert was an attorney with the law firms of Cadwalader, Wickersham & Taft and Arent Fox. Before Mr. Ebert started his legal career, he served as a consultant to the Director of Commerce of the City of Philadelphia and worked on economic development programs, real estate tax abatement programs and analyzed business competitiveness factors between major municipalities across the United States. Mr. Ebert has lectured at numerous academic centers, real estate broker continuing education programs and private industry forums, including events hosted by financial institutions and real estate companies, on matters of real estate, business law and taxation.
Firm Profile:
Ebert Lontok maintains a strong team of attorneys and paralegals to handle your real estate needs. We regularly represent purchasers, sellers and financial institutions at closings in New York City, Westchester County, Putnam County, Long Island and other areas, and have the business, taxation and litigation expertise to address more complex matters.