All Forum Posts by: Bryan Zuetel

@Karl B., the standard/customary purchase agreement used for residential properties in California provides you an inspection period for you to bring in an inspector.  This can be waived in the contract, but it's there.  Yes, you should pay the $400-500 for an inspector, so you know what you're getting in to.

No, no, no.  Referral fees are not per se illegal in California.  It depends on a few factors.  Is it a finder's fee, a referral fee, or a commission split?  Did the receiving party do nothing more than introduce the buyer and seller?  Is the payor of the fee a licensed broker?  Is there a RESPA regulated loan?

@Josef Roberge, local business license laws differ immensely.  Some might require that the business operates regularly within the jurisdiction or have a physical presence there or have employees there.  You need to review the specifics of the business license law.  

@Zach Riegler, the previous comment is generally correct but should be qualified that it assumes that this is a residential lease and that your lease agreement does not have any further terms modifying the statute.

@Cat R., Sorry to be a naysayer, but we live in tenant-friendly California.  Good luck with your extermination clause for rentals in California.  California generally makes pest/vermin control the landlord's responsibility, unless you can prove that the pests/vermin were caused or invited by the tenant.  See Civil Code section 1941.1 here.

@David Stuart, I'm a California real estate attorney and broker and have dealt with this issue multiple times. Generally, yes, you want to contact the HOA regarding the leak and mold problem. Whether the leak and mold is the HOA's or seller's responsibility depends on a few factors and documents, most specifically the CC&R's, but the CC&R's are difficult to read and understand for most agents and non-attorneys. In addition, it is suspicious and unusual that the seller brought in his own inspector during escrow for a condo unit. The inspector is usually retained and working on behalf of the buyer.

So, contact the HOA, see what the HOA is willing to do, see what the seller is willing to do to remedy the situation, and decide whether you want to proceed with the transaction.

@Karen Montague, the answer to your question really depends where you're licensed and working. I'm a California real estate attorney and broker. If I represent the buyers in a residential transaction that is listed on the MLS, the seller typically pays my commission through the listing agent because we agree to that in the purchase agreement and in our agreement with the local Realtor association and MLS. Commercial and off market transactions operate differently and are generally subject to what is negotiated and agreed upon in a contract. You can also request that the buyers sign a buyer agency agreement specifying who pays the commission.

@Paul Martinez, I'm a real estate attorney and broker.  I grew up in the San Gabriel Valley and know most of the areas.  An 81 unit apartment complex will be a significant undertaking but potentially profitable.  If you want to PM me the address, I can do a search for the owner through my title service and we can discuss further.

The following are examples straight from the California Franchise Tax Board, FTB 3556 LLC Memo (publicly available with a simple Google search), as to what California will deem is "doing business" in California, thus subjecting you to the $800 minimum tax. I would suggest that you think long and hard about how your corporate and LLC setup falls in these examples. As you'll see, it doesn't take much for you and your corporation or LLC to be deemed "doing business" in California.

Example 1

Paul is a California resident and a member of a Nevada LLC. The Nevada LLC owns property in Nevada. The LLC hires a Nevada management company to collect rents and provide maintenance. Paul has the right to hire and fire the management company. He occasionally has telephone discussions with the management company regarding the property. He is ultimately responsible for the property and oversees the management company. Paul conducts business in California on behalf of the LLC. The LLC must file Form 568.

Example 2

Rachel is a California resident and member of an Oregon LLC. The Oregon LLC has a retail store in Oregon. Rachel uses a California address for the LLC's tax filings and a California accountant to prepare the LLC's tax returns. Rachel conducts business in California on behalf of the LLC. The LLC must file Form 568.

Example 3

Sara is a California resident and a member of a Texas LLC. The Texas LLC receives royalties from Texas oil wells. Sara maintains a California business bank account and secures financing in California for the LLC's Texas investments. Sara conducts business in California on behalf of the LLC. The LLC must file Form 568.

@James Hsia, in California, you will have pretty limited options as to what you can do.  Some of the ideas mentioned above in other states are simply not available or permitted in California.  You might be able to keep some of the security deposit, but this depends on your lease agreement and other important factors and deadlines.  The California Court system has a pretty good summary here: http://www.courts.ca.gov/1049.htm.

@Bryan Cork, if it's an issue with family members who are also business partners, then you will certainly need to involve a real estate attorney.  I am a real estate attorney and willing to have a preliminary discussion with you or your in-laws if you want to PM me.