What We Do:

Civil Justice, Inc has established the First Time Home Buyer Program in Maryland. The program will provide, at no cost, trained lawyers to assist first time home buyers in the complicated process of entering into a contract to purchase a home.

The only requirements are that:

• You are a First Time Home Buyer.
• The home is within Civil Justice's priority service area.
• The purchase price is $125,000 or less.
• You contact Civil Justice before completing the purchase, preferably before making an offer to purchase.
  

Why First TIME HOME BUYERS NEED A LAWYER

Flipping [1]:

“Flipping” schemes, Predatory Lending and mortgage fraud have destroyed the dream of homeownership for many Baltimoreans. Home buyers need Consumer Protection.

The “flipper” usually targets first time home buyers who believe they cannot afford a house or have bad credit. The “flipper” earns the trust of the buyer by using his knowledge and experience with the home buying process to make the deal seem easy. The “flipper” promises to arrange a loan, take care of all the paperwork, and may even let the buyer move right in before the sale.

What the buyer does not know is that the “flipper” bought the house cheap, made only cosmetic repairs, and is now selling it to them for a price that far exceeds its value. The buyer now has a mortgage loan for the inflated sales price. The “flipper” walks away from the deal with all the loan money, but the buyer winds up with a house that is not worth what she owes.

Worse still, the mortgage loan may have an inflated interest rate or hidden repayment clauses – AND the homes usually require expensive repairs which the new homeowner cannot afford. Too often, the buyer cannot pay and winds up in foreclosure or even bankruptcy. These bad deals turn your dream of homeownership into a nightmare.

Protect yourself:

Many First Time Home Buyers simply go through the purchase process without an advocate on their behalf –– but that can be a costly mistake.

Find out how much the house is really worth before you sign a contract.

Check out the Maryland State Department of Assessment and Taxation website which can instantly give you the State's assessment of the value of any property in Maryland. Although this may not be a true reflection of the market value of the property, it can give you a general idea. Also, you can check the name of the current owner, the last sale date and the last sales price. (Be aware, though, that many “flips” are transacted in the same day and may not appear on the site.)

Get independent advice before you sign a contract or agree to a mortgage.

There are many sources of advice and counseling available to First Time Home Buyers.

• Before you even decide on a particular house, you can talk to a Housing Counselor who can review your income, credit and housing needs and assist you in getting qualified for a home loan. For a referral to a counselor near you, you may wish to contact the statewide toll-free MCCD Housing Hotline at 1-888-949-6677.
• In addition, you may wish to get a buyer's real estate agent – one not affiliated with the seller or lender – who can represent you in finding a house you can afford at a fair price and in negotiating with the seller.
• Civil Justice's First Time Home Buyers Project will provide free legal advice and consumer protection counseling to home buyers in Baltimore who meet the eligibility requirement. We are happy to work with your Housing Counselor and Realtor as well.

Know the warning signs of "flipping".

These practices are not always illegal, but are warning signs that you should slow down, get the facts, and get independent advice:

• The seller tries to rush you into signing a contract and does not answer your questions about the price and condition of the house.
• The person with whom you are dealing is not the person who holds title to the property.
• The seller offers to let you move in right away, or offers you free rent.
• The house is in poor condition and the seller promises to make repairs, but the promises are not in writing.
• The seller says he can get you a loan even though you have bad credit.
• The seller wants to give you a "gift" or "grant" for the down payment or closing costs, but does not disclose the gift in the mortgage application.
• The seller wants to make all the arrangements for getting the loan, inspections, appraisals and title company.
• Information about your debts, income and employment are listed incorrectly on the mortgage application.

Take action.

Buying a home is probably the largest purchase you will ever make in your life. Take the time to make sure you:

• Have the house inspected by a qualified home inspector whom you choose. Look for an inspector who is a member of a state or national association that imposes a code of ethics on its members.
• Make sure that any promises the seller makes, such as repairs he is to perform, are written down in the contract. Consider making settlement contingent on the completion of the repairs, or fixing a dollar amount for repairs that the seller will be responsible for.
• Check the loan application and other documents to make sure that the seller or lender has not exaggerated your income, or hidden your debts. This could qualify you for a loan that is too expensive, or that you may not be able to afford.
• Call your local government's housing code section to find out if there are any code violations on the property.

[1] parts taken from the Office of the Attorney General, Consumer Protection Division brochure "Home Buyers: Beware of "Flipping Scams"