House Passes Dodd-Frank Reform Act

The U.S. House of Representatives has announced the passage of the Financial CHOICE Act (Creating Hope and Opportunity for Investors, Consumers and Entrepreneurs), legislation to overhaul and replace the Dodd-Frank Act.

“Every promise of Dodd-Frank has been broken,” said House Financial Services Committee Chairman Jeb Hensarling (R-TX). “Fortunately there is a better, smarter way. It’s called the Financial CHOICE Act. It stands for economic growth for all, but bank bailouts for none. We will end bank bailouts once and for all. We will replace bailouts with bankruptcy. We will replace economic stagnation with a growing, healthy economy.”

For More Details: utm_source=MadMimi&utm_medium=email&utm_content=BREAKING%3A+House+Passes+Dodd-Frank+Reform+Act&utm_campaign=20170608_m139736346_BREAKING%3A+House+Passes+Dodd-Frank+Reform+Act&utm_term=MORE+DETAILS+HERE+___

Posted in Uncategorized | Leave a comment

Changes to the NJ Recording Act

You will recall that the NJ Recording Act was revised back in May of 2012.  As part of that revision, the law implemented an optional cover sheet for all documents to be submitted for recordation (NJSA 46:26A-5(b)).  If a document is not accompanied by such a cover sheet, the county shall charge an additional $20.00 for indexing of the document (NJSA 46:26A-5(c)).  The law contained a 5 year “phase in” period during which the use of cover sheets or the payment of the additional fee was discretionary.  That 5 year period expires next month – May of 2017.

The cover sheet being used in each county is required by law to be posted on that county’s website.  While the law specifies exactly what information must be included on the Cover Sheet, the format may vary by county.  Thus, it should not be assumed that a Cover Sheet which applies in one county may be used in another.


Posted in Uncategorized | Leave a comment

NOTICE: Increase in Nassau County Verification Fee

We have just been advised by the New York State Land Title Association that the Nassau County Legislature has approved an increase in the tax map verification letter (TMVL) fee, despite the opposition of the county clerk and the no votes of a minority of Legislators.

The fee required by the Department of Assessment for issuing a TMVL will be $355 as of January 1, 2017. The TMVL fee is paid to the county assessor. The county clerk does not collect the fee but requires the TMVL for recording.

Posted in Uncategorized | Leave a comment

Suffolk County Mortgage Verification Fee Increase

      Pursuant to an act of the Suffolk County Legislature, effective January 1, 2017, the Suffolk County Clerk’s office will begin to assess a Mortgage Verification fee on all mortgage related documents submitted for recording. The assessment will be charged at a rate of $300 per document and will affect documents such as, but not limited to Mortgages, Assignments, CEMAs and Satisfaction of Mortgages.

The present expectation is that this fee will be treated the same as in years past. As long as the document is in Real Property by 12/31/2016 the new fee will not apply. Documents presented in Real Property on 01/01/2017 and after will be assessed the fee. The thirty-day rule will still apply, so if the documents were verified prior to 01/01/2017 they would still have to be recorded within the 30 day period, otherwise the new fee will apply.

Posted in Uncategorized | Leave a comment

Big Changes for New Jersey Estate Tax

 R.I.P. New Jersey Estate Tax: 1934 – 2017

You may have seen various news stories concerning the State’s recent dilemma with funding the Transportation Trust Fund. The Legislature has passed, and the Governor has signed, two laws that provide a funding mechanism for the Transportation Trust Fund by increasing the gasoline tax, while reducing various other taxes, such as the Sales and Use Tax.

Of importance to us are provisions in one law (P.L. 2016 c. 57) that alter the New Jersey Estate Tax. Effective on January 1, 2017 and for the remainder of the 2017 calendar year (i.e., for decedents dying between January 1, 2017 and December 31, 2017, inclusive of these dates), the rate of the New Jersey Estate Tax is reduced, and the threshold for estates subject to the tax is increased from $675,000.00 to the 2017 threshold of $2,000,000.00. Thus, for decedents dying in calendar year 2017, although a Tax Waiver will still be required, fewer estates will be required to file a New Jersey Estate Tax Return, and those that do will have to pay less in New Jersey Estate Taxes.

Effective on January 1, 2018 (i.e., for decedents dying on or after this date), there will be no New Jersey Estate Tax. The legislation eliminates the Estate Tax entirely for decedents dying on or after that date.

Note that the legislation does not alter any aspect of the New Jersey Inheritance Tax, which will continue to apply in its current form. Also, although the tax itself will be eliminated, there will be no effect on existing liens for New Jersey Estate Tax, which will persist after December 31, 2017. In sum:

Date of Death New Jersey Estate Tax (NJET) Ramifications
Prior to January 1, 2002 Unpaid NJET does not constitute a lien.
January 1, 2002 – December 31, 2016 Estates valued at $675,000 or more are subject to the NJET; the lien for unpaid tax persists until paid.
January 1, 2017 – December 31, 2017 Estates valued at $2,000,000 or more are subject to the NJET; the lien for unpaid tax persists until paid.
On or after January 1, 2018 NJET is repealed.

Before the end of the year, we anticipate that the New Jersey Division of Taxation will amend the L-9 form (Affidavit of Resident Decedent Requesting Real Property Tax Waiver(s)) to reflect the new threshold of $2,000,000, as well as the IT-Estate (the New Jersey Estate Tax Return), to account for the threshold increase and the reduced rate of taxation. Just as before, even for 2017 estates that are alleged to be valued below $2,000,000 and thus exempt, an L-9 must be completed to obtain a Tax Waiver, which must be filed in the county land records.

Posted in Uncategorized | Leave a comment

In The News – June 2011


            The Real Estate Settlement Procedures Act (RESPA) is a federal consumer protection law that regulates the real estate settlement process, including the servicing of loans and the assignment of those loans. RESPA places a number of duties on lenders and loan servicers, including requirements that borrowers be given notice by both a transferor and a transferee when their loan is transferred to a new lender or servicer, and that loan servicers respond promptly to borrowers’ written requests for information.

            It takes a qualified written request to trigger the loan servicer’s duties under RESPA to acknowledge and respond. RESPA defines a “qualified written request” as written correspondence from the borrower or his or her agent that requests information or states reasons for the borrower’s belief that the account is in error. To qualify, the written request must also include the name and account number of the borrower or must enable the servicer to identify the borrower.

            Within 60 days after receiving a qualified written request, the servicer must take one of three actions: (1) make appropriate corrections to the borrower’s account and notify the borrower in writing of the corrections; (2) investigate the borrower’s account and provide the borrower with a written clarification as to why the servicer believes the borrower’s account to be correct; or (3) investigate the borrower’s account and provide either the requested information or an explanation as to why the requested information is unavailable.

            In any event, the servicer must provide a name and telephone number of a representative of the servicer who can assist the borrower. During the 60‑day period, a servicer may not provide information regarding any overdue payment, owed by such borrower and relating to such period or qualified written request, to any consumer reporting agency.

            In the culmination of what the court described as “maddening troubles” that two borrowers, a husband and wife, encountered with two mortgage companies, a federal appellate court ruled that the borrowers’ claims under RESPA for damages could proceed to a trial on the merits. Two of the five different letters sent by the borrowers were ruled to be qualified written requests. As to both letters, the borrowers contended that one of the mortgage servicers violated RESPA by reporting their account as delinquent to credit bureaus within the 60‑day window after the letters were received. As to one of the letters, the servicer also was alleged to have failed to investigate properly or to take corrective action.

            The borrowers withstood an argument by the mortgage servicers that the borrowers had not done enough to raise triable issues on actual damages allegedly sustained as a result of the RESPA violations. It was for a jury to decide if they had, in fact, suffered the compensable losses they claimed, stemming from being denied home equity lines of credit and a small business loan, and from suffering emotional distress from the whole affair.


            Having a net worth of $1 million, or maybe even $2 million, does not give you entry into such a small exceptional group as used to be the case. By some estimates, between 5 and 6 million American households have a net worth of at least $2 million. This means that currently there are considerably more people who should consider how best to shield their money from the IRS and pass it on to their heirs, assuming that is their wish. One such strategy that just became more attractive, due to new federal legislation, is the making of gifts during one’s lifetime.

            Among the significant pieces of the new federal tax law that was passed in December 2010 were very substantial, albeit temporary, increases in the lifetime gift tax exemptions for individuals and couples. For 2011 and 2012, these exemptions have increased five‑fold, from $1 million to $5 million for individuals, and from $2 million to $10 million for couples. There will be no gift tax imposed on gifts that do not exceed those totals. The same law reduces the tax rate for gifts above the exemptions to 35% from a scheduled rate of 55%, thus benefiting individuals wealthy enough to make gifts that exceed the exemption levels.

            Last year, Congress also raised the exemption for federal estate taxes to $5 million, and lowered the estate tax rate to 35%, also for a two‑year period, so that, taken together, the new federal estate and gift tax rates are more favorable for taxpayers than they have been for approximately 80 years.

            This is an area of the law for which sophisticated professional help is especially appropriate, but there are some general considerations to bear in mind when devising a plan for gift‑giving. For example, making a gift now, tax‑free, makes good sense, especially for assets that are appreciating rapidly, so that future appreciation can be shielded from taxes. It is conceivable that Congress in the future could “claw back” gifts that are greater than the exemption at the time the donor dies, but, even in that event, any income or appreciation occurring after the gift date should be tax-exempt.

            Other considerations for giving are more emotional than legal. Financial considerations aside, it may be a high priority for you to make sure that assets with sentimental value are preserved for future descendants, such as by putting them into a trust. Or gift‑giving decisions may entail weighing some remorse over parting with assets that took so long to acquire against the desire to improve the lot of those receiving the gifts. Of course, a contrarian view might see large gifts as mainly abdicating control and risking having everything squandered. In any case, if these considerations are all reconciled in favor of making major gifts, now may well be the time to take the plunge.

Posted in News Letters | Leave a comment



            On December 17, 2010, the president signed into law an $858 billion federal tax package. The main elements of the legislation are a two‑year extension of the reductions of income, capital gains, and dividend taxes enacted during the Bush Administration and a one‑year extension on unemployment insurance benefits that had ended as of December 1. Although many parts of the package are of relatively short duration, below are some highlights of the new tax law:

 Your Paycheck

            Beginning in January 2011, a 2% drop in an employee’s share of the Social Security portion of the FICA tax, from 6.2% to 4.2%, will increase take‑home pay for most workers. For example, this means an additional $1,600 in 2011 for someone making $80,000 a year.

            There will be a two‑year extension of the 2001 and 2003 income tax cuts from the Bush era. This means that, at least through 2012, the tax rates will remain at the current levels, based on income: 10%, 15%, 25%, 28%, 33%, and 35%.

            The extension of certain tax benefits also means that for those making less than $90,000 a year ($180,000 for married couples), there will continue to be a $2,500 tax credit to help pay for college tuition. This American Opportunity Tax Credit had been scheduled to expire at the end of 2010. The Child Tax Credit, which had been set at $500, has been hiked to $1,000.

            The new law also lifts the exemption levels for the alternative minimum tax (AMT), sparing millions of middle‑income taxpayers from being subjected to the AMT.

 Your Investments

            Without action by Congress, 2011 tax rates on the profits of assets sold after more than a year would have increased to 20% and dividends would have reverted to being taxed at ordinary income rates. Instead, rates on long‑term capital gains and for dividends on certain stocks held longer than 60 days will stay at 15% through 2012. Maintaining the status quo also means that taxpayers in the two lowest income tax brackets will continue to have a 0% capital gains rate.

 Your Estate

            In 2009, there was a maximum estate tax rate of 45% and a $3.5 million exemption. The estate tax temporarily disappeared in 2010. Under the new law, for 2011 and 2012 the maximum rate will be 35%, with a $5 million personal exemption. Any unused exemption may be passed to a surviving spouse, so that a married couple can exempt up to $10 million. In keeping with the short‑lived nature of many parts of the new law, without further legislation there will be a 55% estate tax rate in 2013 and an exemption of just $1 million per person.

 Your Retirement

            The new tax law continues provisions that permit investors who are 70‑1/2 or older to make a qualified distribution of up to $100,000 from an IRA directly to a qualified charity for 2010 and 2011. However, the new law did not preserve what had been a suspension of minimum required distributions (MRDs). To avoid a stiff penalty, retirees generally must take MRDs from their retirement accounts for the year in which they turn 70‑1/2, and all years after that, no later than the last day of the calendar year.


Home Appraisal Fraud

            Joseph and Kimberli bought an unimproved lot in a subdivision and then engaged an architect and a contractor to design and build the home of their dreams on it. The lot and finished home together would cost them about $731,000. They borrowed most of the sales price from a bank, which sought and obtained an appraisal from an appraiser regularly used by the bank. Conveniently enough, the appraisal came in at about $731,000 when conducted under both a cost approach and a sales comparison approach.

            After the couple had been in their new house about a year, Kimberli lost her job and the couple went back to the bank to apply for a home equity line of credit. This required another appraisal from a new appraiser. To the shock and consternation of the homeowners, the property was appraised this time at only $510,000. To use a term which has come to describe so many, Joseph and Kimberli were “under water.” Denied the home equity loan and unable to pay the mortgage, they managed to sell the property for $660,000.

            When Joseph and Kimberli sued the first appraiser for intentional misrepresentation, the claim was upheld by a state supreme court, which ruled that the couple had presented enough evidence to warrant a jury trial. A plaintiff suing for intentional misrepresentation must prove that

1. The defendant made a false representation of an existing or past material fact;

2. The defendant made the representation recklessly, with knowledge that it was false or without belief that the representation was true; and

3. The plaintiff reasonably relied on the representation, causing him damage.

            The gist of the suit was that the appraiser, to please everyone involved at that moment, intentionally misrepresented the value of the property when he appraised it at a dollar amount substantially higher than its true value. The defendant appraiser contended that an appraisal is in one sense an opinion, rather than a simple statement of fact. However, for purposes of a claim for fraud, an appraisal can be regarded as a representation of fact.

            On the issue of recklessness, there was evidence for both sides, but the issue needed to be resolved by a jury. Favoring Joseph and Kimberli was evidence that the appraisal request from the bank was for a “Rush!” appraisal, and the appraisal value matched the sales price virtually down to the dollar. Joseph and Kimberli would get their chance in court to prove that, to their detriment, the appraiser was determined to come up with the “right” appraisal to make the deal happen, even if the truth of the property’s actual value was a casualty in the transaction.


Noncompliance with HUD

            When a home loan is insured by the U.S. Department of Housing and Urban Development (HUD), regulations impose some loan servicing responsibilities on the lender, while also granting certain forms of relief for borrowers facing the prospect of foreclosure. For example, under certain conditions, the lender must initiate face‑to‑face contact with the borrower before starting foreclosure proceedings. Before a borrower falls behind by four full monthly installments on a mortgage, the lender must evaluate all of the loss mitigation techniques provided for in the regulations.

            These regulations have an obvious bearing on the relationship between lenders on HUD‑insured loans and the federal government, but it is a closer question of law as to whether a borrower can raise a lender’s failure to comply with the regulations as a defense when the borrower defaults and the lender sues to foreclose on the mortgage.

            Recently, a state court agreed with a borrower who had defaulted on her HUD‑insured mortgage that a foreclosure action by her mortgage company could not go forward until it was shown that the mortgage company first had complied with the servicing responsibilities imposed by HUD.

            The main point of contention in the case concerned the face‑to‑face contact requirement. This regulation applies only if the mortgaged property is within 200 miles of the lender. The mortgage company in this case was established under the laws of a distant state that was more than 200 miles from the property, but the borrower countered that the company had an office within the 200‑mile range, in a neighboring state.

            The court ruled that the HUD loan servicing requirements had such importance that the failure to comply with them should be an affirmative defense for a defaulting borrower. Families who receive HUD‑insured mortgages generally do not qualify for conventional mortgages. It would make no sense to create a program to aid families for whom homeownership would otherwise be impossible without promulgating mandatory regulations for HUD‑approved mortgagees to ensure that the objectives of the HUD program are met. The goal of preventing foreclosure in HUD mortgages wherever possible cannot be attained if HUD’s involvement begins and ends with the purchase of the home and the receipt of a mortgage by a low‑income family.

Posted in Uncategorized | Leave a comment

News coming soon

Check back soon to keep up with the latest news

Posted in Uncategorized | Leave a comment

Coming Soon.

Newsletter will be coming soon

Posted in Uncategorized | 1 Comment