This usually goes unnoticed until there is a default under the CEMA and the foreclosure search shows that the mortgage that was assigned (and is now part of the consolidation) has since been fulfilled. Since, at least in New York, defective gratuities cannot be corrected by a subsequent « corrective » instrument, this error then requires a silent title action to undo the erroneous satisfaction. The investigator reports that this is a securities agency that wants to promote and recommend a mortgage tax product to potential refinancing clients in New York, what the agency calls a « mortgage tax guarantee. » Specifically, the product would ensure that a homeowner who refinances their home loan, but is not eligible for a consolidation, modification or renewal of that loan, would only pay mortgage tax on any additional mortgage amount borrowed from a lender. The plaintiff cites the following example: 1 For the purposes of this investigation, the Office of the Advocate General is not required to deal with the type of insurance, if any, that would constitute the security under section 1113 of the Insurance Act, which is the section that defines the types of authorized insurance that may be purchased in that state. CEMA stands for « Consolidation, Extension, & Modification Agreement » and is an agreement between two lenders on an existing mortgage. Think of it as taking over the seller`s existing mortgage. While you`re getting your own mortgage at current interest rates, avoid « capturing » a new mortgage with New York State and New York, which means you`re also avoiding the mortgage registration tax on that principal. All of this is a matter of jurisprudence, but a somewhat new decision, Bank of New York Mellon Trust Company, N.A. v. Claypoole, 150 A.D.3d 505, 55 N.Y.S.3d 19 (1st Dept. 2017), usefully confirms that satisfaction is false and can be erased. Although the applicant initially refers to his proposal as a « guarantee », in reality the product is a guarantee.
A warranty refers in any way to the nature or efficacy of a particular product sold and does not cover any risk that has nothing to do with the manufacture or quality of that product. A guarantee, on the other hand, is the obligation that the amount to be paid in the contract will be paid or that the guaranteed services will be provided. A guarantee directly concerns the content and purpose of the transaction. Ollendorff Uhr Co.c. Pink, 279 N.Y. 32 (1938). The applicant`s client, a securities agent, would like to promote a « mortgage tax guarantee » that guarantees that a borrower would only pay mortgage tax on new or additional debt, even if, for any reason (including the existing lender`s refusal to consolidate the loan), the borrower would not be eligible for the CMAA. An LMA is a document that modifies the terms of an existing mortgage and merges it with a new mortgage for the same property.
Old and new mortgages become a single mortgage through a CEMA. Since the tax on mortgage files has already been paid under the previous mortgage, you do not have to pay it again. Depending on your existing lender`s fee to receive a CEMA, the average fee ~ $2,000. If the amount of tax savings significantly exceeds the cost of CETA fees, it may be a good idea to pursue a GAC. Tony Guerra served in the U.S. Navy for over 20 years. He also spent seven years as Director of Flight Operations. Guerra is a former real estate broker, salesperson, associate broker and real estate educator. He holds a Master`s degree in Management and a Bachelor`s degree in Interdisciplinary Studies.
From a business perspective, your CEMA should start with the original offering. If you discover that the seller has a large enough mortgage and is willing to cooperate, you must include the seller`s participation in your offer. If you take it back after signing the contract, the seller may demand a significant portion of the savings or not cooperate because they want to conclude quickly. By attaching a CEMA to your bid (or at least an attempt), everything is transparent from the start. .