Do you understand drone registrations and laws regarding security deposits?

Jeff Baker and Betsy Urbance

Among the issues discussed during the Dec. 17 IAR Legal Webinar, “Out With (Review) the Old and In With the New,” were federal requirements for drone registrations as well as an amendment to the Illinois Security Deposit Interest Act that affects some renters’ security deposits.

Drone registration today

Bigstock Photo

Bigstock Photo

The commercial use of drones is prohibited by federal law unless a certificate (also known as a Section 333 Waiver) has been granted by the Federal Aviation Administration, said IAR Transaction Helpline Attorney Jeff Baker, noting the process can be expensive and time intensive. REALTORS® who want to use a commercial drone, he said, should get a certificate or hire someone who has one.

Today, most drone pilots will have to register their drones online at www.faa.gov. Registration must be by credit card and will cost $5 but rebates will be issued to those who sign up during the first 30 days.

Registration includes providing the owner’s name, home address and email address. Each owner will receive a unique identification number for his or her aircraft and the number must be marked on the drone.

Security deposit interest law changes – for some

IAR Legal Hotline Attorney Betsy Urbance said that the Security Deposit Interest Act was amended, and starting Jan. 1, Illinois landlords aren’t required to pay interest on security deposits for qualifying rental property unless the annual interest is $5 or more. If the amount is less than $5, the landlord can credit the interest to the tenant and disburse at the end of the tenancy. However, it is important for landlords and property managers to know if they live in Chicago or in another home rule community, stricter requirements may apply.

For instance, Chicago’s Residential Landlord Tenant Ordinance requires annual interest payments on security deposits to be issued to tenants even if the amount is less than $5. Urbance says landlords and property managers need to be aware of local ordinances that may be stricter.

Other news

Urbance and Baker also recapped several court decisions and answered questions from Illinois REALTORS® who participated in the webinar, while providing some advice about the TILA RESPA Integrated Disclosure changes that took effect Oct. 3. While noting that some lending institutions are taking more time since the rules became effective, and some REALTORS® may be experiencing heartburn over delays in the closing process, they’ve not heard of anything “overly catastrophic.”

They also discussed other matters that are regulated by the Consumer Financial Protection Bureau (CFPB) under RESPA, concerning affiliated business arrangements. They warned members to be sure that they are making the required written disclosures when recommending their affiliated businesses to consumers. There are very specific requirements for those written disclosures, and CFPB seems to be actively enforcing these federal rules and the potential penalties are high.

For more information on the webinar, Illinois REALTORS® can login and download recordings of the one-hour presentation. Legal webinars are a members-only benefit.

Wrigley scoreboard legal decision featured in November legal case studies

DR Legal News masthead 459 by 81A new scoreboard looming over the Wrigley Field outfield resulted in a court battle as the owners of several neighboring buildings claimed its installation violated antitrust laws and was a breach of contract. (Member login required.)

This is one of six legal case studies analyzed by Christine Self of Sorling Northrup Attorneys in the November issue of DR Legal News.

In the Wrigley Field case, the building owners (Right Field Rooftops, LLC) filed complaints against the Cubs (Chicago Baseball Holdings, LLC) in federal district court stating that the video board and billboard blocked the view of the field and violated a license agreement between the two parties. The building owners wanted to halt stadium expansion that began in September 2014.

The court dismissed both claims. Find out why.

If you’d like to know about the other case studies, read these quick descriptions:

  • Difficulty setting a price does not extinguish an option to purchase.
  • A settlor who declares a trust naming herself as trustee is not required to separately transfer property into the trust.
  • Implied warranty of habitability is not applicable to architects and may be disclaimed by other parties.
  • Road relocation did not result in material impairment.
  • Tenants may recover reasonable attorney fees in successful counterclaims.

Login and read the entire DR Legal News now.

DR Legal News: Communication key to TRID-governed transactions

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Brokers need to communicate early and often with buyers and sellers and work closely with buyers’ lenders, especially when it comes to TRID-governed transactions, writes Jeffrey T. Baker, IAR Transaction Hotline Attorney, in the November edition of D.R. Legal News for managing brokers (log in required).

Baker describes these suggestions as “best practices” and says brokers play a key role in keeping their buyers and sellers informed of process and timeline changes that took effect on Oct. 3, as the TILA-RESPA Integrated Disclosure rule changes kicked in.

Bigstock Photo

Bigstock Photo

For example, he noted the overall timeline for transactions could range from 45 to 60 days, and by talking about this upfront with clients, brokers can help to manage client expectations.

Baker also encourages brokers to:

  • Encourage buyers to obtain financing pre-approval from a lender before they search for a new home;
  • Help clients understand the timing and arrival of the Loan Estimate and when buyers must indicate their intent to proceed with the loan (also double-check with lenders and buyer-clients to see if the lender has a specific form that must be used for the intent to proceed);
  • Help clients understand the timing of the Closing Disclosure forms;
  • Encourage buyers to conduct final walk-throughs as early as possible to avoid closing delays, and
  • Review office policies to ensure adequate protection of the buyer’s or seller’s personal information.

For more information on TRID best practices, six legal case studies and more, managing brokers can read the November D.R. Legal News.

DR Legal News masthead 459 by 81

Legal Services busts myths and shares facts in ‘TRID Revisited’

Golden scales of justice, gavel and books on brown background

Photo by Bigstock

REALTORS® are mistaken if they believe almost any circumstance will reset the three-day rule for giving Closing Disclosures to buyers before closings, says the IAR Legal Services Team.

In fact, during Thursday’s IAR Legal Webinar, “TRID Revisited,” IAR Hotline Attorney Betsy Urbance and IAR Transaction Helpline Attorney Jeff Baker noted only three reasons can be used to reset the three-day period:

  • A change to the loan’s annual percentage rate (APR) beyond the permitted tolerance,
  • A change to the loan product or
  • The addition of a pre-payment penalty.
Betsy Urbance and Jeffrey Baker

Betsy Urbance and Jeffrey Baker

“I hope that’s at least one myth we’ve busted in this webinar,” said Urbance.

In addition to dispelling myths, Urbance and Baker reviewed information they’d gathered from the Consumer Financial Protection Bureau and other key sources since TRID rule changes kicked in on Oct. 3.

Exceptions to the rule

They also cited four circumstances when TRID would NOT apply:

  • Home Equity Lines of Credit (HELOCs),
  • Reverse mortgages,
  • Loans secured by personal property, such as a mobile home or a dwelling not attached to real property and
  • All-cash transactions.

What about Saturdays?

Another important fact under the new TRID rules, Urbance and Baker said, is that Saturdays would always be considered business days with respect to Closing Disclosures, while they would only be considered business days for Loan Estimates when the specified lenders are open for business on Saturdays.

Get best practices through IAR

To find out more about what the Legal Services Team has gathered for IAR members, including several examples of best practices, login to the recorded version of “TRID Revisited” or listen to the audio only recording.

The next IAR Legal Webinar is tentatively scheduled for Dec. 17.

Login for TRID Legal Webinar today at 9:30 a.m.

Bigstock photo

Bigstock photo

Join in the next IAR Legal Webinar, “TRID Revisited,” at 9:30 a.m. today, with IAR Transaction Helpline Attorney Jeff Baker and IAR Legal Hotline Attorney Betsy Urbance.

Urbance and Baker will explore questions that have come up since the Truth-in-Lending/RESPA Integrated Disclosure Rule took effect on Oct. 3. If you have a question you’d like answered, please send it in advance to webinar@iar.org. Questions will be answered during the webinar, and priority will be given to those received in advance.

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Those who are unavailable to listen online will find it in the archives (www.illinoisrealtor.org/legal/webinars) within 48 hours of its completion. Remember member login is required.