Commercial Real Estate Blog by Madison
Tag Archives: mortgagee

Title Insurance in the U.S. vs. Abroad

As a British subject, once in a while I find myself in the company of ex-compatriots – old neighbours and friends that might be here in the US on holiday or business. I try hard to control myself from visibly rolling my eyes and taking a deep breath when the discussion invariably turns to my line of business. Blimey! Do I really have to explain what I do for a living? I learned years ago that the concept of an industry specifically dedicated to insuring real estate title was — for the most part — foreign to those blokes on the other side of the pond (as well as in most of the world) until quite recently. Even now, their version of title insurance doesn’t resemble ours in the U.S. Continue reading

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Even the Air in New York City is Expensive.

The real reason why the neighbor is having lunch with you is because he wants to build a bigger building on his property, but is not able to because he has used up all his development rights, which is referred to as floor area ratio or FAR for short, under the applicable zoning. Thus, he is coming to you so that the excess FAR on your property may be purchased and “transferred” to his property. To be clear, he is not asking to build on top of your property, but rather, merely wants to use the excess FAR on your property so that he can build on top of his existing 10-story building. You are about to retire and you never really had plans to build anything higher so you negotiate and agree to sell the excess FAR to your good neighbor for $5,000,000! This is not a bad deal for the neighbor since transferrable development rights may sell for close to or in excess of the value of the vacant land itself. Now, how do you get this deal done? Continue reading

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New York State Mortgage Tax

The State of New York levies a tax on mortgages that are secured by real property. The tax is a percentage based on the mortgage amount which varies by county and city. The two cities being Yonkers and the five boroughs that make up New York City. When a mortgage is made on real property, it must be recorded in the county where the property is located and the proper mortgage tax must be collected and paid to the county at that time. This process is handled by the title company insuring the lender’s mortgage. The tax is onerous and buyers go to great lengths to lessen the pain of this tax. Continue reading

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