Attorneys practicing in and around the Chicagoland area. Experienced in the practice areas of Real Estate Law, Mortgage Foreclosure Defense Litigation, Social Security Disability, Business Law, & Estate Law.

 - Attorneys practicing in and around the Chicagoland area. Experienced in the practice areas of Real Estate Law, Mortgage Foreclosure Defense Litigation, Social Security Disability, Business Law, & Estate Law.

New ID Rules at the Airport Are Pushed Back to 2020

O'Hare International Airport

In this post, we discuss the new ID rules for domestic air travel and how their enforcement has been pushed back to October 2020.

Good news for air travelers!

U.S. domestic air travelers were granted a reprieve on meeting new flight rules.

All 50 states have met the January 22, 2019 deadline to become compliant with Real ID or were granted an extension to do.

This means that passengers can continue to use their driver’s licenses at airport security checks for domestic flights.

Your current Illinois driver’s license or ID card (DL/ID) will be accepted at airports, military bases, and secure federal facilities until Oct. 1, 2020.

 

The new ID rules for domestic flights

The Real ID Act was passed by Congress in 2005, in the wake of 9/11, to raise security standards nationally for all state-issued driver’s licenses.

Illinois Real ID Drivers License

Driver’s License photo from Illinois Secretary of State

Is your license compliant?

Take a quick look at your driver’s license. Does it have a star in the upper right corner?

The new REAL ID compliant driver’s licenses have stars in the upper right corner to show that they meet current security standards.

 

Sources and more information
About RealID – Office of the Illinois Secretary of State
New ID rules at the airport are pushed back to 2020 – CNBC
TSA Check: Does Your Driver’s License Have a Star On It? – Forbes
Illinois begins issuing driver’s licenses that comply with federal Real ID law – Chicago Tribune

O’Hare International Airport photo is licensed under the Creative Commons Attribution 2.0 Generic license. Original photo by Nicola has been cropped and signage was altered to remove logo.

 


* Advertising Material: To the extent that the information in this post is interpreted as attorney advertising in accordance with the Illinois Rules of Professional Conduct or within the meaning of state bar rules from all other localities, this statement is made pursuant to those rules.

Specialties: Specialization claims are prohibited by Illinois Supreme Court Rules and we do not claim to be specialists. The content of this e-mail is organized and presented for the sole purpose of general information. None of the included content should be construed as legal advice. Viewing this e-mail or e-mailing the account holder does not create an attorney-client relationship. NOTICE: This page may be considered advertising material.


 

The Law Offices of Lora Fausett P.C. provides real estate law services including loan modificationsbuying and selling assistanceshort sales and deeds in lieumortgage foreclosure defense, and more.

Located in Glen Ellyn, Illinois and serving clients in DuPageCookKane, Will, and Kendall Counties.

For Information Call 630-858-0090


 

Lawyers Who Took on Big Tobacco Are Aiming at Realtors and Their 6% Fee

Illinois home with tax lien

A new class-action lawsuit takes aim at real estate agents and the tools they use to do business, and housing industry watchers say it could revolutionize the way Americans buy and sell the biggest asset they’ll ever own.

The suit was filed in Chicago on behalf of anyone who sold a home through one of 20 of the largest listing services in the country over the past five years.

It charges that the mighty Washington-based lobby National Association of Realtors, as well as the four largest national real estate brokerages, and the Multiple Listing Services they use, have conspired to require anyone selling a home to pay the commission of the broker representing their buyer “at an inflated amount,” in violation of federal antitrust law.

Homeowners who are ready to sell their properties usually hire a real-estate agent to represent them by staging the home, photographing it, adding it to the MLS, marketing it, and showing it to prospective buyers.

Sellers agree to pay that person a commission on the selling price of the home. That commission has traditionally been known as the “6%,” but it’s a little more complicated than that.

Home for saleSellers can really only negotiate with the agent they’ve hired, while agents representing buyers are generally assured of a standard 3% commission. That means that a seller’s agent who’s willing to negotiate, or one that works for a discount brokerage like Redfin RDFN, +0.71% , will be paid less than a buyer’s agent.

Buyers can choose to be represented by an agent, or to go without one – but in any case, all commission money for both sides of the deal is always paid by the seller, thanks to a 1996 NAR rule known as the “Buyer Broker Commission Rule.”

In order to list a property on one of the many regional databases known as Multiple Listing Services, agents must abide by the Buyer Broker Rule.

Listing on the MLS is essential for making a sale, and most MLSs are controlled by local NAR associations.

“The conspiracy has saddled home sellers with a cost that would be borne by the buyer in a competitive market,” the lawsuit says. “Moreover, because most buyer brokers will not show homes to their clients where the seller is offering a lower buyer broker commission, or will show homes with higher commission offers first, sellers are incentivized when making the required blanket, non-negotiable offer to procure the buyer brokers’ cooperation by offering a high commission.”

As MarketWatch has previously reported, many housing observers call Realtors a “cartel” for the way they purposely steer clients to transactions in which traditional ways of doing business are observed.

Rob Hahn is the founder and managing partner of 7DS Associates, a real estate consultancy. In a blog posted shortly after the lawsuit was filed, Hahn called it a potential “nuclear bomb on the industry.” And in an interview with MarketWatch, he said that he’s taking it “very seriously.”

Property Tax Assessment - CalculatorIn large part, that’s because of the heft of the law firms behind the suit. Both Cohen Milstein Sellers & Toll, and Hagens Berman Sobol Shapiro have a long history of prevailing over weighty entities like Volkswagen, for its emissions scandal, Apple, for its e-book collusion, and Exxon , after the Valdez spill.

In response to a request for comment, NAR said, “The complaint is baseless and contains an abundance of false claims. The U.S. Courts have routinely found that Multiple Listing Services are pro-competitive and benefit consumers by creating great efficiencies in the home-buying and selling process. NAR looks forward to obtaining a similar precedent regarding this filing.”

Still, as Hahn put it, past lawsuits have mostly been filed by what he calls “ambulance-chasers,” not the firms behind some of the biggest civil settlements in American history.

That view is shared by Cohen Milstein partner Daniel Small, who called the way Realtors do business “a longstanding problem.” What’s different now, Small told MarketWatch, is that deep-pocketed law firms had done a “substantial investigation” that convinced them that there was merit to the case.

Small declined to elaborate on what had prompted the investigation in the first place.

Photo by Max Pixel

It’s worth noting, however, that the suit was filed roughly four months after the expiration of a Department of Justice consent decree against the National Association of Realtors. That settlement was struck in 2008 after the federal government spent several years unsuccessfully trying to rein in what it called anti-competitive behavior from NAR, which felt under attack from internet upstarts.

Hahn thinks it’s ironic that an innovation that tried to protect buyers, by providing them with representation in a complex and deeply emotional transaction, has soured the market so badly.

Many housing watchers have long argued that real estate services should be paid for a la carte, or in a sliding-scale fee structure, rather than a flat commission, whether that’s 6% or 1%. But, Hahn said, “there’s no chance whatsoever that the industry goes that way voluntarily.”

What’s more likely, he thinks, is that the American system will come to resemble real estate markets in Australia or England, where sellers and buyers each pay their own broker – or don’t. After all, buyers are usually “cash-strapped,” Hahn noted: saving every nickel for a down payment, closing costs and moving expenses. While the entrenched interests in the American real estate industry will argue that’s not consumer-friendly, Hahn says he’s “never seen a study that says buyers get screwed” without representation.

A former lawyer himself, Hahn isn’t sure how to handicap this case. But if it prevails, he thinks enormous changes are in store for the industry. The ranks of buyers’ brokers will likely be decimated, and the infrastructure behind the MLSs and the local associations will wither away too.

A spokesperson for Realogy RLGY, +1.10% said, “We believe this case has no merit and will not be commenting further.”

A spokesperson for Keller Williams said, “It’s not our policy to comment on pending litigation.” A spokesperson for RE/MAX Holdings RMAX, +1.32% declined to comment, and a request for comment by Berkshire Hathaway-held BRK.B, +0.21% HomeServices of America, Inc. was not returned.

“This is an important case for many reasons,” Daniel Small said. “Among them is that this is the biggest transactions of most peoples’ lives. There is a lot at stake.”

This story originally appeared in MarketWatch and was written by Andrea Riquier.


 

Law Offices of Lora Matthews Fausett, P.C.

If you require a real estate attorney in DuPage, Kane, Will, Kendall, or Cook County to represent you with any issues related to real estate, the Law Offices of Lora Matthews Fausett, P.C. are well trained to handle matters relating to buying and selling, short salescommercial leases, as well as foreclosure defense and many others.

 

For Information Call 630-858-0090


* Advertising Material: To the extent that the information in this post is interpreted as attorney advertising in accordance with the Illinois Rules of Professional Conduct or within the meaning of state bar rules from all other localities, this statement is made pursuant to those rules.

Specialties: Specialization claims are prohibited by Illinois Supreme Court Rules and we do not claim to be specialists. The content of this e-mail is organized and presented for the sole purpose of general information. None of the included content should be construed as legal advice. Viewing this e-mail or e-mailing the account holder does not create an attorney-client relationship. NOTICE: This page may be considered advertising material.


MLS Lawsuit Could Change the Real Estate Industry

MLS Lawsuit - Class Action Suit

In this post, we discuss a potentially “game-changing” lawsuit that could change the entire real estate market.

The real estate market could be facing big changes depending on the outcome of a class action lawsuit against the National Association of Realtors and the four biggest nationwide realtors.

 

About the Lawsuit

The defendants are being accused of violating federal antitrust law in a conspiracy to overcharge home sellers by requiring them to pay broker’s commissions to the agents who represent the buyers of their home.

The class action lawsuit is against RE/MAX, Keller Williams, Realogy, HomeServices of America, and the National Association of Realtors.

The suit has been filed in federal district court in Chicago and focuses on a rule it says has been imposed by the National Association of Realtors.

The rule requires brokers who list sellers’ properties on local MLS to include a “non-negotiable offer” of compensation to the buyer agents. That is, once a home seller agrees in a listing to a specific split of the commission, the buyers cannot later negotiate their agents’ split to a lower rate.

Home For SaleThe suit alleges that this requirement “saddle(s) home sellers with a cost that would be borne by the buyer in a competitive market,” where buyers pay directly for the services rendered by their agents.

In overseas markets where there is not a mandatory compensation rule for buyer agents, total commission costs tend to be lower.

On average, commission costs average 1%-3% percent lower in the United Kingdom, as opposed to the 5-6% that is commonplace in the United States.

 

The Allegation

The class action suit alleges that if home buyers in the United States could negotiate fees directly with the agents they choose to represent them, that fees would be more competitive and the costs lower.

Many U.S. home buyers are unaware of their agent’s commission split. The sellers will typically know what the percentage is because they agreed to it in their listing contract.

Real Estate red tape

Photo by Max Pixel

However, they may wonder: Why am I required to pay the fee of the buyer’s agent, who may be negotiating against my interests in the transaction?

Also, at a time when buyers often search for and find the house they want to buy online, shouldn’t compensation for a buyer’s agents be decreasing, rather than remain at the 2.5%-3% percent range?

The lawsuit states “Because most buyer brokers will not show homes to their clients where the seller is offering a lower buyer broker commission, or will show homes with higher commission offers first, sellers are incentivized when making the required blanket, non-negotiable offer to procure the buyer brokers’ cooperation by offering a high commission. Absent this rule, buyer brokers would be paid by their clients and would compete to be retained by offering a lower commission.”

 

About the Defendants

The National Association of Realtors is the largest trade group in real estate with 1.3 million members.

The four realty companies named as defendants are RE/MAX Holdings Inc., Keller Williams Realty Inc., HomeServices of America Inc. and Realogy Holdings Corp.

Model Home TaxKeller Williams has approximately 180,000 agents in the U.S. and Canada. RE/MAX has 120,000 agents. Realogy includes among its brands Better Homes and Gardens, Century 21, Coldwell Banker Real Estate and ERA; HomeServices of America is a Berkshire Hathaway affiliate and includes Long and Foster Real Estate and Edina Realty.

NAR Vice President Mantill Williams called the suit “baseless” and said it “contains an abundance of false claims.”

“The U.S. Courts have routinely found that Multiple Listing Services are pro-competitive and benefit consumers by creating great efficiencies in the home buying and selling process,” said Williams. “NAR looks forward to obtaining a similar precedent regarding this filing.”

Representatives of the four realty companies declined to comment.

Many Realtors say the suit could dismantle the compensation system as it now exists.

Anthony Lamacchia, broker-owner of Lamacchia Realty in Waltham, Massachusetts, says if the suit is successful “it would basically destroy buyer agency, which would not be in the best interests of buyers or sellers.”

He argues that even in an era where buyers find their homes online, the buyer agent still has important duties in handling contract negotiations, providing strategic advice and guiding clients through the process of closing.

Other brokers challenged allegations in the suit. Alexis Eldorrado, the managing broker of Eldorrado Chicago Real Estate, responded in regards to buyer agents refusing to show homes with low commission splits.

“In reality, if the buyers have found the place they want and are interested in seeing it, NAR’s code of ethics requires the agent to show it,” said Eldorrado.

 

About the Plaintiff

GavelThe plaintiff in the case is Christopher Moehrl.

He sold a home in 2017 using a RE/MAX broker to list the property while the buyer was represented by Keller Williams.

Moehrl paid a total commission of 6 percent. Almost half of that, 2.7 percent, went to the buyer’s agent.

If the case is certified as a class action, the potential number of sellers affected would be massive.

It would include sellers who have paid a broker commission during the past four years in connection with a home listed by an MLS in these metropolitan areas: Washington D.C.; Baltimore; Cleveland; Dallas; Denver; Detroit; Houston; Las Vegas; Miami; Philadelphia; Phoenix; Salt Lake City; Richmond, Virginia; Tampa, Orlando, Sarasota and Ft. Myers, Florida; Charlotte and Raleigh, North Carolina; Austin and San Antonio, Texas; Columbus, Ohio; and Colorado Springs, Colorado.

 

The entire real estate industry will have an interest in the outcome of this case.

 

Sources:

Class action suit could change real-estate commissions – Chicago Tribune

A new class action lawsuit could upend the real estate business as we know it – The Real Deal

What the bombshell buyer-side lawsuit means for Realtors – Inman

 

Law Offices of Lora Matthews Fausett, P.C.

If you require a real estate attorney in Naperville to represent you with any issues related to buying a home or property there, the Law Offices of Lora Matthews Fausett, P.C. are well trained to handle matters relating to buying and selling, short salescommercial leases, as well as foreclosure defense and many others.

 

For Information Call 630-858-0090


* Advertising Material: To the extent that the information in this post is interpreted as attorney advertising in accordance with the Illinois Rules of Professional Conduct or within the meaning of state bar rules from all other localities, this statement is made pursuant to those rules.

Specialties: Specialization claims are prohibited by Illinois Supreme Court Rules and we do not claim to be specialists. The content of this e-mail is organized and presented for the sole purpose of general information. None of the included content should be construed as legal advice. Viewing this e-mail or e-mailing the account holder does not create an attorney-client relationship. NOTICE: This page may be considered advertising material.


Is Tax Code Uncertainty Affecting the Illinois Real Estate Market?

Home For Sale

In this post, we discuss theories offered by real estate agents as to why homes in Illinois are taking longer to sell in 2019 than last year. 

Homes in Illinois are taking longer to sell in 2019. Some real estate agents are offering possible reasons as to why this is.

 

Why are Illinois homes taking longer to sell?

Some real estate agents have a theory as to why it’s taken longer for homes to sell over the winter and spring.

Many agenst are saying the real estate slowdown is a response to buyer uncertainty about how recent tax code changes will affect what people can afford.

“There were huge changes, and people aren’t sure what it means for them until they file this year,” said Greer Haseman, an @properties agent based out of Oak Park, Illinois.

The slowdown has been noticable in Oak Park. In the first months of 2018, Oak Park homse sold in 92 days on average. In the same months of 2019 that average has jumped to 120 days.

Buyers “don’t want to plan what to spend until they know all the implications (of the revisions) on their family’s finances,” Haseman said.

 

Uncertainty is slowing the Illinois real estate market

Open House signThis question over tax code changes has added another uncertainty to the housing market in the Chicagoland region.

Another major factor is property taxes. Illinois already has the second highest property taxes in the nation. With the state economy facing serious debt and cities and counties facing budget shortfalls, fears about increased property taxes are definitely a concern.

Many economists are also concerned about the possibility of another recession. Some are projecting it could happen and that is probably keeping some buyers on the sidelines.

The uncertainty over how the new tax code will alter home budgets, “is limited to this winter,” said Jordan Chalmers, a Baird & Warner agent based out of Lincoln Park. “But it’s uncertainty, and any market dislikes uncertainty.”

 

The people most unlikely to hold off on buying a new home because of market uncertainty are upper income buyers. They are the most likely buyers to be impacted by the recent $10,000 limit on state and local taxes that can be claimed for a deduction.

 

Affects of uncertaintly not the same in all areas

Home for saleIn Lake County, Will County, and the city of Chicago, the average time a home is on the market has been longer in the first two months of 2019 than during the same period in 2018.

Only in DuPage County has the average time on market actually been shorter than last year.

The increases in market times may not always be huge, but the housing market in the Chicago area has not been as strong in other parts of the country. There is less room in this delicate market than in other places, and any swing in sale times or prices is felt more strongly here.

Recent increases in the number of homes for sale in some areas have left less-competitive houses to remain on the market longer.

Nobody likes to blame the weather but a long, tough winter definitely didn’t help things either.

Hopefully anyone who was waiting for better weather will start their house hunting soon.

 

Law Offices of Lora Matthews Fausett, P.C.

If you require a real estate attorney in Naperville to represent you with any issues related to buying a home or property there, the Law Offices of Lora Matthews Fausett, P.C. are well trained to handle matters relating to buying and selling, short salescommercial leases, as well as foreclosure defense and many others.

 

For Information Call 630-858-0090


* Advertising Material: To the extent that the information in this post is interpreted as attorney advertising in accordance with the Illinois Rules of Professional Conduct or within the meaning of state bar rules from all other localities, this statement is made pursuant to those rules.

Specialties: Specialization claims are prohibited by Illinois Supreme Court Rules and we do not claim to be specialists. The content of this e-mail is organized and presented for the sole purpose of general information. None of the included content should be construed as legal advice. Viewing this e-mail or e-mailing the account holder does not create an attorney-client relationship. NOTICE: This page may be considered advertising material.


Naperville Named Best Place to Raise Family and Best Public Schools

In this post, we discuss Naperville being named the Best City to Raise a Family in America and ranked as City With the Best Public Schools in America.

Naperville has been a booming community for decades and a very popular community to live.

One of the top reasons people have been choosing to live in Naperville is because of its highly rated schools make it a great place to raise a family.

This month another organization has awarded Naperville two top rankings in it’s annual “2019 Best Places List“.

Naperville was named the Best City to Raise a Family in America, and also designated City with the Best Public Schools.

 

2019 Best Places to Raise a Family

  1. Kane County Property TaxesNaperville, IL
  2. The Woodlands, TX
  3. Arlington, VA
  4. Ann Arbor, MI
  5. Columbia, MD
  6. Overland Park, KS
  7. Plano, TX
  8. Bellevue, WA
  9. Cambridge, MA
  10. Irvine, CA

According to Niche.com, the 2019 Best Places to Raise a Family list ranks cities using a “comprehensive assessment of key factors that are meaningful for families”.

The ratings take into account factors such as the quality of local schools, crime rates, safety, affordability, housing, walkability, and access to family amenities, in an attempt to measure the appeal of an area for families.

Read the full report

 

2019 Cities with the Best Public Schools in America

  1. Naperville, ILReal Estate Home Buying Myths
  2. Ann Arbor, MI
  3. Bellevue, WA
  4. Overland Park, KS
  5. Irvine, CA
  6. The Woodlands, TX
  7. Carlsbad, CA
  8. Plano, TX
  9. Thousand Oaks, CA
  10. Arlington, VA

For rating the best public schools, the cities were rated on “state test scores, graduation rates, SAT/ACT scores, teacher quality, and student and parent reviews”.

Read the full report

 

Other Highlights

Naperville led the way in the public schools category with an A-plus rating. The city also got an A-plus for the health and fitness category, an A-minus for diversity, and an A-minus for jobs.

Naperville didn’t rank so well in every single category. Niche rated Naperville with a B-minus for crime and safety and a C-plus for weather and cost of living.

They also took personal ratings by residents into consideration. The city had hundreds of excellent reviews and very few poor ones. Some of the resident’s reviews said things such as “great town to grow up in” and a “good place to raise kids.”

 

We agree that Naperville is a great place to raise your family and are happy to see the city recognized.

Law Offices of Lora Matthews Fausett, P.C.

If you require a real estate attorney in Naperville to represent you with any issues related to buying a home or property there, the Law Offices of Lora Matthews Fausett, P.C. are well trained to handle matters relating to buying and selling, short sales, commercial leases, as well as foreclosure defense and many others.

 

For Information Call 630-858-0090


* Advertising Material: To the extent that the information in this post is interpreted as attorney advertising in accordance with the Illinois Rules of Professional Conduct or within the meaning of state bar rules from all other localities, this statement is made pursuant to those rules.

Specialties: Specialization claims are prohibited by Illinois Supreme Court Rules and we do not claim to be specialists. The content of this e-mail is organized and presented for the sole purpose of general information. None of the included content should be construed as legal advice. Viewing this e-mail or e-mailing the account holder does not create an attorney-client relationship. NOTICE: This page may be considered advertising material.