Philadelphia Real Estate Law – Consumer protections
Whether you are buying, selling, renting or leasing a home, the government has placed certain protections in the laws that protect you from being scammed out of your hard earned money. Understanding these will help you stand up for your rights and avoid potential scams.
PROTECTION IN THE HOME BUYING PROCESS IN PHILADELPHIA REAL ESTATE LAW
One of the biggest struggles homebuyers face is unethical lending practices from mortgage providers. In 2009, Pennsylvania passed a law to provide protections for homebuyers in the mortgage industry. Under these new laws, all salespeople working for mortgage companies must be state licensed. Also, mortgage providers must use a clear disclosure form to help buyers understand their mortgages, and they must go through the proper steps to ensure borrowers can afford the products they sell to them. These laws apply to both new purchase mortgages and refinance products.
The Pennsylvania Home Inspection Law also protects buyers. This law requires all homes to be inspected by a certified, licensed home inspector. This prevents buyers from purchasing a home with a serious, but hidden, flaw.
Philadelphia real estate law does not just protect buyers. It also has protections in place for sellers. For example, in a home sale, the seller’s agent and the buyer’s agent must disclose any conflicts of interest, such as buying and selling agents who work for the same firm. Sellers then have the right to decide to change agents if they wish.
Protections in the Rental Process in Philadelphia Real Estate Law
Investing in property in Philadelphia can be quite lucrative, but there are also risks involved. One of the dangers investors face is the risk of tenants who do not pay their rent or take care of the property. The security deposit helps protect against this. Under current state laws, landlords can ask for two months of rent upfront for the first year of a lease. In the second year, this drops to one month of rent. If the tenant remains in the property for a third year, investors must place the security deposit in an interest bearing account, with the interest paid to the renter at the end of the lease agreement. We suggest using a Philadelphia Management company or at minimum Philadelphia rental agents to ensure that requirements are complied with.
If the renter damages the property or fails to pay the rent, then that security deposit becomes the property of the landlord, but only after a written list of complaints is presented. That list must be presented within 30 days of the violation. Otherwise, the money is returned to the renter at the end of the lease agreement, with interest if applicable.
In each of these situations, the law offers protection for consumers against unethical practices of others involved in the real estate process. If everyone understands and adheres to these laws, the real estate process, whether buying or leasing, will be much smoother.