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It's been a while since I updated this blog, and mostly before the holidays, it was just due to sheer volume of closings that were happening. In January, I was planning on getting back into updating the blog, and I even had some great articles planned with my outlook for the year. Unfortunately, some personal matters have arisen and I need to attend to them. As a result, I don't know when I'll get back to posting articles here.
People who know me have stood by me over the past few weeks and I want to thank them for their support. I recognize that there are a lot worse problems out there, but at the same time, I cannot ignore or try to escape from what I need to address. I have decided to not only take some time away from updating, but I will also be away from the office a little more in the next while. It is not that I am giving up on writing on my blog, but rather, refocusing my efforts onto something else that needs my attention.
If anybody is actually reading this and is interested in reading my writing, I can be found on Twitter at http://twitter.com/TOLegal.
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| Posted by Brian Kwan at | | | |
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| According to the blog, my last post was 57 days ago, or almost two months ago. It's not the longest stretch I've gone without an update, but something new is certainly warranted. I've got plenty to rant about anyway.
This summer, I've been pretty busy. Unfortunately, many of my clients were from a different generation and believe that calling is the best way to communicate with me. While it is efficient if there requires a significant amount of discussion. It starts becoming a hindrance when people begin calling on administrative matters and call every 10 minutes to see if ... |
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| Posted by Brian Kwan at | | | |
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I was out with a group of friends and some of them had been considering buying their first home. I recommended the use of real estate agents for their purchase since the vendor will typically pay all of the commissions to their agent, so there isn't a direct cost. They made an interesting point by suggesting that there may be collusion between the agents to keep the price high so that they can collect higher commissions.
I've written before about how many parties involved in a real estate transaction may not be looking out for your interests and are driven by other motivations, usually in collecting commissions. Why is it that lawyers are required to avoid having a financial interest in transactions (i.e. commissions), but agents are not? Can they really be looking out for you if they are paid this way?
An interesting point was made that vendors are also affected by this alleged "collusion". If an agent sells for $10,000 less than market value, it only results in around $500 of lowered commission for them. A small sum considering the thousands of dollars they'll be collecting from commission, but quite a large sum the vendor is out.
This isn't to say that real estate agents are greedy or evil, but simply that there is something inherently wrong with the system. Real estate agents need to be renumberated by other means, rather than the actual selling price. Whether this is done through an hourly pay scale or a flat agreed upon amount in advance (e.g. 5% of the listing price) is something for discussion another day.
In the end, I'd still recommend using an agent, but always be cautious of who you choose. It's like interviewing someone for a job.
On a side note, I've recently heard ads on the radio about how using an agent will prevent purchasers from being left with "only a lightbulb", so it would appear that real estate agents are now taking responsibility for the condition of the property after closing. So if something is missing from your home purchase, ask the agent to fix it.
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| Posted by Brian Kwan at | | | |
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Many recent publications that I've received have addressed the issue of mortgage fraud, but it keeps bringing me back to the same question: Why are lawyers continually held responsible and mortgage agents and brokers are given a pass?
If you think about it, mortgage brokers present banks and lenders with all relevant information to determine risk, along with current identification. The mortgage broker will have met with the borrower before any pre-approval is given by the lender, and mortgage brokers are often privy to much more information about the borrower than the lawyer. However, when a mortgage goes into default, it is always the lawyer that is examined first and the broker a non-factor. Lawyers may be held liable in some situations, but the broker is given a pass, despite their very heavy involvement in the deal.
If banks and lenders care about protecting themselves from fraud, why are they not stopping it at the earliest possible stage, the mortgage brokers? The answer is really more political than practical.
I had a conversation with a colleague about how there should be some rule that if a mortgage falls into default in the first year that brokers should be forced to return their commissions. However, if one bank did that, all brokers would pull their business from that bank, leading to a lower quality and quantity of borrowers dealing with that particular bank.
The system isn't fair, but life isn't either, and it's clear where our society places it's priority; in making sales no matter what the cost.
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| Posted by Brian Kwan at | | | |
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In the mail today came another complimentary copy of Precedent magazine, a publication that's supposed to be targeted to lawyers, but really, it's only for lawyers working on Bay Street. I've never really liked their style, but I feel bad about throwing out their work as soon as I get it, so I usually browse through it for a few minutes, looking at the pictures, before declaring that people need to realize that not every lawyer works on for a big firm in downtown Toronto.
Anyway, a brief article caught my eye regarding articling requirements for foreign trained lawyers. The Law Society is now allowing foreign trained lawyers who had work experience elsewhere to be exempted from articling. On the upside, this frees up available articling positions for Canadian law school graduates, since those are in short supply.
The downside, and this is really a negative, is that foreign trained lawyers can immediately open up shop and provide legal services, despite never having worked a day in Ontario. So the next lawyer offerring low prices may be someone who has absolutely no idea how things work in Ontario. Sure, they might have sat through a class and learned the basics, but it's not a real substitute for work experience.
In my view, it also creates a double standard: Canadian law graduates, with a proven standard, are forced to jump through hoops, whereas a foreign trained lawyer from a diploma mill university who worked as a tea server at a law firm under the guise of a junior lawyer can now skip articling completely.
Members of the Law Society, lawyers and paralegals alike, should be bordering on a revolt by now. But I guess unlike me, most lawyers actually throw out Precedent magazine without looking at it.
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| Posted by Brian Kwan at | | | |
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Sometimes people aren't looking out for you not due to personal greed, but due to their own lack of knowledge.
This post comes from a Tweet I had sent regarding why some real estate agents insist on attempting to provide their clients with legal advice. While many times, it helps clients understand, it can often do more harm than good. Many times, the agent will provide incorrect advice to a client, which he or she may rely on, and then proceed with a deal, only for the lawyer to tell them that the agent was wrong. It's not due to any ill-will of the agent, but rather from her over-reaching in her role. The agent's intent is to be commended, but she really would be better served deferring to a lawyer.
The worst part of these scenarios is when the client finally makes it to the lawyer and the lawyer tells them what the law is, the typical response is, "That's not what my agent told me." The result, for me at least, is a lengthy explanation of the law followed by a reminder that real estate agents shouldn't be giving legal advice.
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| Posted by Brian Kwan at | | | |
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| I completed a transaction recently that wasn't without controversy. My client had obtained a mortgage that he wasn't comfortable with and asked me if it was a good deal. As all two of my regular readers would know, it's something I can't answer. I told him to speak to his mortgage broker, but he didn't trust her. I gave him the name of another broker and said to seek a second opinion from him. He did so and realized that the mortgage his first broker had set up was not right for his situation and decided to go in another ... |
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| Posted by Brian Kwan at | | | |
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While driving home from the office today, I was thinking about what I should blog about. After hitting the 401 and seeing the many supporters of our troops, I actually wanted to give my support by Twitter, but realized it wasn't the best thing to do while driving. That made it clear to me that blogging wasn't the way to go for me.
Often, I'll want to share a link or just a random comment from wherever. With Twitter, I can do it easily and right away. For my blog, I need to use a computer and log in before I can ... |
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| Posted by Brian Kwan at | | | |
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With the drop in local home sales, many condo developers have been pushing their projects into final closing recently, leading to a spike in real estate closings for me lately. Unfortunately, many of these developers do things on such short time frames that I am often rushed to get everything done. This rush is really created because they can't get their figures together in time or they don't advise solicitors of the closing dates, thus forcing us to rely upon our client's memory.
As a result, I've had to close several condos with only a few days notice. The mortgage is often ... |
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| Posted by Brian Kwan at | | | |
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