Sunday, December 9, 2012

Getting a Land Loan, The Positive and Negatives of a Land Contract for Buyers and Sellers

A Land Contract which is also known as “contract for deed”, or “land installment sale”. The buyer makes payments in order to pay down the purchase price. Under this type of arrangement, the seller keeps title to the property and the buyers make monthly payments. When they were able to pay off the balance owed then the seller would then give them the deed to the property, which would then be recorded in their name In can be interpreted like a rent to own agreement. In one example a seller lost out when the buyer stopped making payments and gave the property back to the seller. Properties values had dropped so the buyers decided to move on. The seller finds out later that the buyers applied for a mortgage loan to buy a home. In this case the buyer would lose out on all of their prior payments, but the seller has no recourse, since he held title and keeps the buyers payments. The seller has to find a new buyer. The seller was complaining because the property values decreased, but he would not be complaining if the property values increased. In this case the seller should have taken a mortgage An example where a buyer loses would be when they make monthly payments for years, and If they can’t make any further payments then they are essentially “out of contract” and will lose all their payments and have no claim on the property. Land contacts are similar to an owner will carry (OWC) as the seller is acting as the mortgage holder instead of a bank. The essential difference with a land contract and an owner will carry type loan is the seller keeps title in a land contract but the buyer has title in an OWC. If the buyer fails to pay on an OWC then the seller can foreclose on the buyer for lack of payments. Land Contacts “land installment sale” are not used as much these day, but can be a viable option as banks are less likely to loan for vacant land. It is also a good option in a decreasing real estate market as our example above shows. Also for home buyers who don’t have the down payment a land contract helps them buy a home over time directly from the seller avoiding banks and mortgage companies.

Saturday, December 1, 2012

AV Solar Ranch One’s Progess and Delays

In July of this year the Antelope Valley Solar Ranch One was vandalized by an unknown source. The incident was reported in their monthly meetings to the local community. The damage costs are estimated to be $100,000. The vandal actually cut a transmission line and a water pipe about 2.5 miles from the solar project site. A report was filed with the local Los Angeles County Sheriff’s Department, and a reward of $25000 has been posted by First Solar for information that leads to the prosecution of the vandal. They now have 24 hour security at the site. AV Solar Ranch One (AVSR1) is owned by embattled First Solar, whose stock was over $200 and dropped below $12 but has recovered a little. The project will move on for this 230-Megawatt photovoltaic solar power plant. There were also rumors of a verbal dispute involving the Los Angeles County Inspector and First Solar employees which led to a shutdown for two months. There are 3.7 million cadmium telluride thin film panels that First Solar was preparing to install at the Exelon facility but they are not Underwriters Laboratory-approved. State of California building and safety codes require UL approval of electrical connectors, but it is not the case in other States where First Solar Inc. operates. The issue has since been resolved. There have also been disputes with the local community over debris left by workers, 18 hour work shifts. There are also several individual communities in the area. At one of the community meetings, it was reported that Antelope Acres, some twelve miles from the Solar Ranch One location, was granted $100,000 for its town council, $10,000 for its 4H Club and $10,000 for a community center, among other considerations. First Solar also donated mitigation lands to Antelope Acres’ chosen desert conservancy, yet Fairmont Town Council whose residents live within 500 feet of the site, has been granted nothing. The company indicated that they considered Fairmount to be within the Antelope Acres Community. Well the Fairmont council members didn’t like that either. Also, many local residents complain that the solar panels are an “eye soar” to the landscape among the poppy fields and the distance mountains. The project is approved and it is moving forward despite the small issues for a project of this size. Californians say they want alternative power and jobs and progress yet they do not want them in their own back yard. If the State wants Solar and Wind projects then they have to be built somewhere, and Antelope Valley is a prime location for these projects.