[WSBAPT] Garn-St. Germain Act

Tue May 20 17:47:51 PDT 2014

Maureen:

I agree that the regs are replete with notations that the act is to be
applied only to owner-occupied situations.

What my point is is that my reading of the statute shows no such
distinction (although I have invited anyone who can steer me to statutory
– not regulatory – language that aims us to the concept of owner-occupied,
I would appreciate seeing that).

Thanks to all who have made comment on this matter.  The horse is about
dead after undergoing a dreadful beating.

Best Regards,

Doug Bratt

Douglas J. Bratt

Lawyer

Office: (360) 213-2040 

 Fax: (360) 213-2030

CONFIDENTIALITY NOTICE:  This email message may contain confidential or
privileged information.  If you have received this message by mistake,
please do not review, disclose, copy, or distribute the email. Instead,
please notify us immediately by replying to this message or telephoning
us.  Thank you.

NOTE:  I do not use encrypted email.  Messages sent to or from my office
via email are not secure and may not be protected by attorney-client
privilege.  This email address is not monitored at all times.  If your
matter is urgent, please phone my office during regular business hours.

TAX ADVICE NOTICE: IRS Circular 230 requires us to advise you that, if
this communication or any attachment contains any tax advice, the advice
is not intended to be used, and cannot be used, for the purpose of
avoiding federal tax penalties. A taxpayer may rely on professional advice
to avoid federal tax penalties only if the advice is reflected in a
comprehensive tax opinion that conforms to stringent requirements. Please
contact us if you have any questions about Circular 230 or would like to
discuss our preparation of an opinion that conforms to these IRS rules.

From: wsbapt-owner at lists.wsbarppt.com
[mailto:wsbapt-owner at lists.wsbarppt.com] On Behalf Of Wickert Law Office
Sent: Tuesday, May 20, 2014 4:05 PM
To: wsbapt at lists.wsbarppt.com
Subject: RE: [WSBAPT] Garn-St. Germain Act [text][auto-ip]

You may want to look at the beginning of 12 CFR 591.5(b)….

“(b) Specific limitations. With respect to any loan on the security of a
home occupied or to be occupied by the borrower,”

Very truly yours,

Maureen A. Wickert, Attorney at Law

14900 Interurban Avenue South

        Suite 271 - PMB 66

        Tukwila, WA 98168

       Phone: 206-931-6307

         Fax: 206-206-9005

     www.wickertlawoffice.com <http://www.wickertlawoffice.com/> 

       wickertlaw at comcast.net

This electronic message contains information which may be confidential
and/or legally privileged. The information is intended for the use of the
individual or entity named above. If you are not the intended recipient,
be aware that any disclosure, copying, distribution or use of the contents
of this transmission is prohibited. If you have received this electronic
transmission in error, please notify me by telephone or by email
immediately.

IRS Circular 230 Disclaimer: To ensure compliance with requirements
imposed by the IRS, we inform you that to the extent this communication
contains advice relating to a Federal tax issue, it is not intended or
written to be used, and it may not be used, for (i) the purpose of
avoiding any penalties that may be imposed on you or any other person or
entity under the Internal Revenue Code or (ii) promoting or marketing to
another party any transaction or matter addressed herein.

From: wsbapt-owner at lists.wsbarppt.com
[mailto:wsbapt-owner at lists.wsbarppt.com] On Behalf Of Douglas Bratt
Sent: Tuesday, May 20, 2014 3:07 PM
To: wsbapt at lists.wsbarppt.com
Subject: RE: [WSBAPT] Garn-St. Germain Act

John:

Thanks for the clarification provided in the regulations.  When one reads
the statute itself, there seems to be no mention that it has to be
owner-occupied to be protected against a due-on-sale clause by Garn-St.
Germain.  (Or, have I missed something?)  

Clearly, a distinction can be drawn between “residential” and
“commercial,” such that a relative of a Decedent could not automatically
get the benefits of a loan on a commercial building.  But, the word
“residential” in the statute does not naturally lead to the conclusion
that it has to be owner-occupied.  

On the other hand, I can see where it would not be fair for a bunch of
lenders, who extended loans to a now-deceased person who owns 30 separate
rental homes, to all be forced to allow for an assumption to take place
simply on the basis that the rental homes were all “residential.”

So, again, I am wondering why there is not clearer language in the act
tying things to an “owner-occupied” situation only.  Or, is it there
someplace else in the Act?

Regards,

Doug 

Douglas J. Bratt

Lawyer

Office: (360) 213-2040 

 Fax: (360) 213-2030

CONFIDENTIALITY NOTICE:  This email message may contain confidential or
privileged information.  If you have received this message by mistake,
please do not review, disclose, copy, or distribute the email. Instead,
please notify us immediately by replying to this message or telephoning
us.  Thank you.

NOTE:  I do not use encrypted email.  Messages sent to or from my office
via email are not secure and may not be protected by attorney-client
privilege.  This email address is not monitored at all times.  If your
matter is urgent, please phone my office during regular business hours.

TAX ADVICE NOTICE: IRS Circular 230 requires us to advise you that, if
this communication or any attachment contains any tax advice, the advice
is not intended to be used, and cannot be used, for the purpose of
avoiding federal tax penalties. A taxpayer may rely on professional advice
to avoid federal tax penalties only if the advice is reflected in a
comprehensive tax opinion that conforms to stringent requirements. Please
contact us if you have any questions about Circular 230 or would like to
discuss our preparation of an opinion that conforms to these IRS rules.

From: wsbapt-owner at lists.wsbarppt.com
[mailto:wsbapt-owner at lists.wsbarppt.com] On Behalf Of sullaw at comcast.net
Sent: Tuesday, May 20, 2014 2:12 PM
To: wsbapt at lists.wsbarppt.com
Subject: Re: [WSBAPT] Garn-St. Germain Act [text]

Douglas:

The "residential" aspect of the defined term requires the property to be
owner occupied to fall within the exemption. There is no prohibition
against exercising a due on sale clause on a non-decedent occupied rental
property that passes to the surviving spouse. This is clearer in the
regulations than in the statute itself.

http://www.law.cornell.edu/cfr/text/12/591.5

Best regards, 
JOHN J. SULLIVAN, 
ATTORNEY

LYONS | SULLIVAN
1111 THIRD AVENUE, SUITE 2890
SEATTLE, WASHINGTON 98101
206•623•6440 - WWW.DLJSLAW.COM

Confidentiality Notice

This email transmission is intended only for the addressee named above. It
contains information that is privileged, confidential, or otherwise
protected from use and disclosure. If you are not the intended recipient,
you are hereby notified that any review, disclosure, copying, or
dissemination of this transmission or the taking of any action in reliance
on its contents or other use is strictly prohibited. If you have received
this transmission in error, please destroy the original and notify us by
telephone immediately. Thank you for your cooperation.

IRS Circular 230 Disclosure

To ensure compliance with requirements imposed by the IRS, we hereby
inform you that any U. S. tax advice contained in this communication
(including attachments, if any) is not intended or written to be used, and
cannot be used, for the purpose of (i) avoiding penalties under the
Internal Revenue Code or (ii) promoting, marketing or recommending to
another party any matter addressed herein. 

  _____  

From: "Douglas Bratt" <djbratt at mbavancouverlaw.com>
To: wsbapt at lists.wsbarppt.com
Sent: Tuesday, May 20, 2014 12:50:49 PM
Subject: [WSBAPT]  Garn-St. Germain Act

Listmates:

Please confirm my understanding of Garn-St. Germain, viz-a-viz the bar on
enforcement of due-on-sale clauses in certain real property loans.

The act states that the bar on enforcement of due-on-sale clauses extends
to “a real property loan secured by a lien on residential real property
containing less than five dwelling units.”

My understanding has been that this applies to both a owner-occupied
residence AND to rental property (with less than five units) owned by the
Decedent.

A major US national bank has made noises about trying to get paid off on a
loan on residential rental property, owned in the sole name of the
Decedent  (the surviving spouse is not mentioned on title).  The bank
filed a Creditor’s Claim in the Decedent’s Probate case, and was even nice
enough to provide a “Payoff Statement,” with a figure good through June
13, 2014.

Have any of you had any situations where banks try to enforce due-on-sale
clauses on rental property with similar tactics, within a probate
proceeding?

Insofar as a response, I am inclined to prepare and file a Denial of
Creditor’s Claim, stating that the debt will be assumed by the Decedent’s
wife, with the real property to remain the security for the loan, and
mention Garn-St.Germain, along with a statutory citation.  Any other
suggestions, legal, practical or otherwise?  

Best Regards,

Doug Bratt

Douglas J. Bratt

Lawyer

Office: (360) 213-2040 

 Fax: (360) 213-2030

CONFIDENTIALITY NOTICE:  This email message may contain confidential or
privileged information.  If you have received this message by mistake,
please do not review, disclose, copy, or distribute the email. Instead,
please notify us immediately by replying to this message or telephoning
us.  Thank you.

NOTE:  I do not use encrypted email.  Messages sent to or from my office
via email are not secure and may not be protected by attorney-client
privilege.  This email address is not monitored at all times.  If your
matter is urgent, please phone my office during regular business hours.

TAX ADVICE NOTICE: IRS Circular 230 requires us to advise you that, if
this communication or any attachment contains any tax advice, the advice
is not intended to be used, and cannot be used, for the purpose of
avoiding federal tax penalties. A taxpayer may rely on professional advice
to avoid federal tax penalties only if the advice is reflected in a
comprehensive tax opinion that conforms to stringent requirements. Please
contact us if you have any questions about Circular 230 or would like to
discuss our preparation of an opinion that conforms to these IRS rules.

=======================

- To contact the list administrator, send a message to:
webmaster at wsbarppt.com

- To unsubscribe, send a new email addressed to: imail at lists.wsbarppt.com,
with the following in the body of the message: unsubscribe wsbapt - OR -
send a message to webmaster at wsbarppt.com asking that you be removed from
the wsbapt list.

Information provided on this list should not be considered legal advice.
As with all lists - let the reader beware! No warranties or
representations are made as to the accuracy of any information provided.
All opinions and comments in this message represent the views of the
author and do not necessarily have the endorsement of the Washington State
Bar Association nor its officers or agents. 

=======================

- To contact the list administrator, send a message to:
webmaster at wsbarppt.com

- To unsubscribe, send a new email addressed to: imail at lists.wsbarppt.com,
with the following in the body of the message: unsubscribe wsbapt - OR -
send a message to webmaster at wsbarppt.com asking that you be removed from
the wsbapt list.

Information provided on this list should not be considered legal advice.
As with all lists - let the reader beware! No warranties or
representations are made as to the accuracy of any information provided.
All opinions and comments in this message represent the views of the
author and do not necessarily have the endorsement of the Washington State
Bar Association nor its officers or agents. 

=======================

- To contact the list administrator, send a message to:
webmaster at wsbarppt.com

- To unsubscribe, send a new email addressed to: imail at lists.wsbarppt.com,
with the following in the body of the message: unsubscribe wsbapt - OR -
send a message to webmaster at wsbarppt.com asking that you be removed from
the wsbapt list.

Information provided on this list should not be considered legal advice.
As with all lists - let the reader beware! No warranties or
representations are made as to the accuracy of any information provided.
All opinions and comments in this message represent the views of the
author and do not necessarily have the endorsement of the Washington State
Bar Association nor its officers or agents. 

=======================

- To contact the list administrator, send a message to:
webmaster at wsbarppt.com

- To unsubscribe, send a new email addressed to: imail at lists.wsbarppt.com,
with the following in the body of the message: unsubscribe wsbapt - OR -
send a message to webmaster at wsbarppt.com asking that you be removed from
the wsbapt list.

Information provided on this list should not be considered legal advice.
As with all lists - let the reader beware! No warranties or
representations are made as to the accuracy of any information provided.
All opinions and comments in this message represent the views of the
author and do not necessarily have the endorsement of the Washington State
Bar Association nor its officers or agents. 

=======================

- To contact the list administrator, send a message to:
webmaster at wsbarppt.com

- To unsubscribe, send a new email addressed to: imail at lists.wsbarppt.com,
with the following in the body of the message: unsubscribe wsbapt - OR -
send a message to webmaster at wsbarppt.com asking that you be removed from
the wsbapt list.

Information provided on this list should not be considered legal advice.
As with all lists - let the reader beware! No warranties or
representations are made as to the accuracy of any information provided.
All opinions and comments in this message represent the views of the
author and do not necessarily have the endorsement of the Washington State
Bar Association nor its officers or agents. 

-------------- next part --------------
A non-text attachment was scrubbed...
Name: winmail.dat
Type: application/ms-tnef
Size: 56942 bytes
Desc: not available
URL: <http://mailman.fsr.com/pipermail/wsbapt/attachments/20140520/e91ab5f4/winmail.dat>