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Longaberger Basket Building On Edge Of Foreclosure

Longaberger Basket Building On Edge Of Foreclosure

The iconic Longaberger basket building is reportedly behind on property taxes and facing foreclosure. If the company does not pay back about 600,000 dollars in property taxes during the upcoming weeks, officials have indicated that the old headquarters in Newark, Ohio will be referred to tax foreclosure.

The Longaberger company specializes in handcrafted baskets and was founded by Dave Longaberger in 1973. Since opening, the company has also distributed a wide variety of home items and lifestyle amenities. The Longaberger basket building was built in 1997 and is still a worldly recognized building due to its architecture and shape. Around the beginning of 2015, the company decide to relocate and combine all employees at another corporate location.

The basket building has been on the sales market for at least a year and a half now since all the employees were relocated. The building is over 175,000 square feet and has dropped its price over two million dollars since starting the sale with a 7.5 million dollar price tag. The inside is a luxurious and modern office space that does not resemble a basket, but buyers still seemed turned away to make a purchase.

The company’s tax issues began in late 2014. If taxes are not paid soon, the county can foreclose on the property and submit it to a foreclosure auction. The property might even become a sheriff sale. The basket building could end up selling at auction for a fraction of what a normal sale would bring.

 

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Short Sale Risks – Be Careful!

Short Sale Risks – Be Careful!

If you are in financial trouble, beware agreeing to a short sale with your lender if that means you will be contractually obligated on any deficiency between the loan and the sale price. That is, if the property sells for $80,000 and you owe $100,000, be cautious about agreeing to the sale if it means you will still need to pay the bank $20,000 (versus having it forgiven). Why?

In Ohio, if the property goes into foreclosure and is sold at auction for a $20,000 loss, the bank has two years to recoup that money from you. That is because Ohio has a two year statute of limitations on deficiency judgments. However, if you sign an agreement with the bank to pay back $20,000, the statute of limitations for contracts is 8-20 years. That means the bank will have turned a two year collection period into a much longer year one! Be careful and talk to knowledgeable counsel before entering into a short sale.

If you live in Ohio and are concerned about going forward with a short sale, call our law firm for help. Here are other things you want to do to protect yourself from longer-term liability from a short sale:

1. Make sure the contract with your selling real estate agent indicates that paying the agent a commission is not only contingent upon the short sale’s approval, but also contingent upon an approval with a “waiver of deficiency.” A waiver will enable you to avoid paying the bank back the $20,000 after the short sale is complete. Without a contingency in your agent’s agreement, you may be liable for their fees if you walk from the short sale because a waiver isn’t accepted.

2. Constantly remind your bank that going through with the short sale is contingent upon a waiver of deficiency. This will decrease the possibility that your lender will “forget” to add in a waiver when they send over the final paperwork. (However, if you think foreclosure is likely, talk to counsel about this, as insisting on a waiver may eliminate your ability to use mitigation of damages as a defense).

3. Don’t expect the short sale process to be over soon, and if you are managing it yourself, it may be wise to contact the bank every other day while you wait for your approval. In today’s short sale and banking world, the squeaky wheel gets the grease.

4. Have an attorney review the final closing documents before the short sale closing, to ensure you are protected from long-term liability. Paying an attorney $600 is a lot cheaper than being on the hook for $20,000 or more.

If you need help with your Ohio short sale, call Doucet & Associates, Inc. at (614) 944-5219.

 

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