We are excited to announce that effective August 9, 2021, our name has changed to Thompson, O’Brien, Kappler & Nasuti, P.C. We adopted this new name to recognize the evolution of our firm. We are proud to highlight the service and expertise that makes our firm distinctive by refreshing our brand. What hasn’t changed is our commitment to our clients, who remain our top priority, and our commitment to deliver on our promise of providing direct access to experienced hands-on lawyers. Rest assured, while we have updated our name, TOKN remains the same.
We are very proud to welcome Mike Williams as Of Counsel to our firm. Mike joins us with over twenty years of combined legal and public policy experience, concentrated on municipal and local government law, public finance, and U.S. Congressional staff work.
We are excited to move to our new location at 2 Sun Court, Suite 400, Peachtree Corners, Georgia 30092.
Get to Know Barry Smith
Barry Smith is a vital member of our team. In fact, he is a valuable asset to every core practice group within TOKN. Barry has been with TOKN since December of 2012. He is well known for his positive attitude, easy laugh, and reputation for going above and beyond. Furthermore, his work ethic, customer service, and patience are remarkable. Barry fulfills a lot of roles for the firm from support of the legal staff to assisting with office events among others. No matter how small or large the task at hand, he completes each one quickly with a smile on his face.
“Barry is always upbeat, professional, and polite. He fills many roles within the firm and accepts every task with a smile!” – Diane Beams, Firm Administrator
Team Member Spotlight Q&A:
Q: What are three random facts people might not know about you?
A: I like to travel (so far I have traveled to 10 states and 7 countries), binge watch my favorite shows, and play basketball.
Q: Where are you from?
A: I’m from a small town in South Georgia called Alapaha.
Q: What do you like most about your job?
A: Interacting with everyone.
If you are considering adding your adult child to your home deed then consider these factors first.
Often, I receive questions from clients asking if they should add their adult child or children to their home deed. While this question is complex, it really depends on the motives and circumstances on a case by case basis. However, below are a few important factors for all parents in this scenario to carefully consider while weighing their options.
What is the purpose?
First and foremost, you should ask yourself, “why do I want to add my child(ren) to my home deed?” The two main answers I typically receive to this question are: (1) I want to make sure my child(ren) has ownership in real estate; and (2) I want to make sure that my child(ren) receives my property upon my death.
For Ownership in Real Estate
Once a child is added to a home deed, the child becomes an owner of the property. Importantly, this means that in order for a parent to sell or refinance the property down the road, the child must also consent. However, the type of interest that the child owns is based upon the matter in which he or she holds title.
The two ways in which a person can hold title are tenants in common and joint tenants with rights of survivorship. Tenants in common means that each grantee owns a divided interest in the property and can individually convey their interest to another party. Additionally, in the event one of the title holders dies, the deceased’s interest is conveyed in accordance with the terms of the deceased’s will. However, if the deceased title holder did not have a will, then the interest is conveyed according to law. In contrast, joint tenants with rights of survivorship means that each grantee owns an undivided interest in the property. Unlike tenants in common, in the event one of the title holders dies, the deceased’s interest in the property will automatically pass to the other title holder(s).
Transferring Property Upon the Parents’ Death
If the purpose of adding your child to your home deed is only to ensure that he or she receives the property upon your death, then it is best to explore other avenues of doing so. For example, you could devise the property through a will. A will is an ideal option for parents who do not wish to have their child be an owner at the time of purchase but would like to successfully transfer their interest to their child upon the parents’ death.
There are significant risks associated with adding a child to your home deed. These risks include, but are not limited to:
- Violating the terms of your security deed;
- The potential of your child’s finances negatively affecting your own ownership and title; and
- Negatively affecting your child’s chances of obtaining student loans.
While these examples are some of the most common, this is not an exhaustive list. The various risks associated with adding a child to a deed depend on your specific circumstances.
Security Deed Violation
Adding an additional party to the deed often violates the terms of the security deed. Furthermore, it can invoke the due on sale clause enabling the lender to accelerate payment of the loan. This would make the full loan payment immediately due. In order to avoid this, you should inform the lender of your desire to add your child to the deed and receive the lender’s approval.
Potential for Liens
Secondly, your home ownership interest can be negatively affected by your child’s finances. Specifically, certain claims, judgments, and liens against your child could attach to your child’s interest in the home. Furthermore, if your child falls on hard times and declares bankruptcy, this act could attach to your home as a lien and potentially affect your own ownership interest in the property.
Student Loan Eligibility
Lastly, being added to the deed could potentially affect your child’s student loan eligibility. Certain schools use a system that accounts for your child’s assets. In applying for financial aid, your child would have to report their ownership interest in the home as one of their assets. Having such an asset could be a factor that negatively affects the amount or total eligibility for student loans.
There are several factors to consider when adding your adult child to a deed. Ultimately, the decision should be made after careful consideration of the risks and benefits.
Audra Frimpong is a new addition to the TOKN family and has already proven to be a valuable asset to out Real Estate team. To learn more about Audra, visit her profile here.
We are very excited to announce the opening of our new Savannah, Georgia office!
Our Savannah, Georgia address is:
2 E. Bryan Street, Suite 442
Savannah, Georgia 31401
You may reach us by phone at 912-348-1776.
We look forward to better serving our coastal Georgia clients!
To find out more about our practice areas, click here.
While optional in Georgia, purchasing owner’s title insurance is always a good idea and always recommended when acquiring real property. After all, why wouldn’t you want to protect your most valuable asset(s)?
What is Title Insurance?
As you probably guessed, title insurance protects the insured owner and/or lender from title defects. These defects can include, but are not limited to, issues affecting the chain of ownership of the property, adverse claims of third parties, and fraud or forgery. As a result of these potential defects, the owner and/or lender can suffer significant financial loss and potentially the complete loss of the property.
Most buyers know that title insurance is available for purchase when acquiring real property. However, buyers are often unaware that they have the option between a standard policy or an enhanced policy.
While there are many differences between the two policies, below are a few of the key differences to consider when deciding which policy option is best for you:
A standard policy insures against title defects that exist at the time a purchaser acquires the property. Put another way, a standard title insurance policy insures against adverse circumstances affecting the title that occurred at or prior to closing, including:
- Forged deeds, mortgages, satisfactions or releases of mortgages, and other instruments;
- Impersonation of the true owners of the land by fraudulent persons;
- Fraud, duress, or coercion in securing essential signatures;
- Mistakes in recording legal documents; and
- Unpaid recorded liens.
An enhanced policy provides the same coverage as a standard policy but also includes some additional protections against title defects that can occur after closing. For example, some of those additional protections include:
- Encroachments of structures on your property or of your improvements on a neighbor’s property;
- Subdivision violations;
- Certain zoning requirements;
- Lack of access to the property;
- Supplemental tax assessments;
- Post policy forgery, encroachments, adverse possession, prescriptive easements, and other clouds on title;
- Automatic increased coverage accounting for increasing property values; and
- Removal of the survey exception contained in the standard title policy.
An enhanced policy is generally about 10% more expensive than a standard policy. However, it also provides much better value for the cost. Ultimately, buyers should be aware of all options in order to make an informed decision they are satisfied with.
Brian Klein is an experienced associate with TOKN’s Real Estate team. If you would like to learn more about Brian and how he can help with your commercial and residential real estate matters, then please visit his profile here. Additionally, Brian is available by phone and email at the number and address listed above.
This summer saw the passage of new federal statutes that amend the Bankruptcy Code. Specifically, On August 23, 2019, President Donald Trump signed into law the Family Farmer Relief Act of 2019 (the “FFRA”), and the Small Business Reorganization Act of 2019 (the “SBRA”).
Family Farmer Relief Act of 2019
The FFRA is perhaps the most significant change to the Bankruptcy Code in that it increased the debt eligibility limit applicable to agribusinesses. Previously, the debt limit for a family farmer to be eligible for Chapter 12 relief was approximately $4.4 million. Due to the FFRA, the debt limit increased to $10 million. Chapter 12 of the Bankruptcy Code is designed to provide debt relief to family farmers with regular income. The goal of the increased debt limit is to make Chapter 12 relief available to more family farmers who would have otherwise had to seek bankruptcy relief under the more onerous and expensive Chapter 11.
Small Business Reorganization Act of 2019
Unlike the FFRA, the SBRA did not go into effect immediately. Rather, the SBRA will take effect in February, 2020. The SBRA will create a new subchapter within Chapter 11 of the Bankruptcy Code for small business debtors. While provisions for small business debtors within the other subchapters of Chapter 11 remain, a small business debtor may elect to proceed under the new subchapter instead. Furthermore, the debt limit for a small business debtor under either option remains the same (approximately $2.5 million). However, the SBRA amends the definition of a small business debtor. The new definition requires that not less than 50% of the debtor’s debts arose from the debtor’s commercial or business activities.
The New Chapter 11
This new subchapter includes significant changes to a small business debtor’s Chapter 11 case and streamlines the requirements for the plan proposal and confirmation processes. Specifically:
- The most substantial structural changes under the SBRA to a small business debtor’s Chapter 11 case are that no committees are to be appointed absent cause and a trustee will be appointed in each small business debtor’s case as a matter of course to perform certain administrative and supervisory duties. For example, the trustee duties will include:
- appearing and being heard regarding the value of property subject to a lien, confirmation or modification of the plan, or sale of property of the estate;
- facilitating the development of a consensual plan;
- ensuring the debtor commences making timely payments required by a plan;
- examining and potentially objecting to proofs of claim; and
- opposing the debtor’s discharge, if advisable.
Plan Filing Deadline
- Under current Chapter 11, a small business debtor has the exclusive right to file a plan during the first 180 days of the case and must file a plan within the first 300 days of the case to avoid dismissal. After filing the plan, the debtor has 45 days to obtain confirmation of the plan, unless extended by court order. Under the SBRA, the debtor will have the exclusive right to file a plan, though it must be filed within the first 90 days of the case. Additionally, there will no longer be a fixed deadline to obtain confirmation.
- The confirmation requirements are changing. Specifically, the SBRA contains two key differences for cramdown plans. First, small business debtors are no longer required to have an accepting impaired class to confirm a cramdown plan. Instead, the plan need only not discriminate unfairly and be fair and equitable with respect to classes of impaired claims and interest. Second, the absolute priority rule is absent from the SBRA. As a result, equity holders can retain interests under the plan without paying higher-priority classes in full.
Preference Litigation and the SBRA
The SBRA also includes two provisions that specifically pertain to preference litigation. Historically, it has been the plaintiff’s burden to prove the elements of a preference under § 547(b), and the defendant’s burden to prove affirmative defenses under § 547(c). Moving forward, the SBRA amends § 547(b) to provide that the trustee or debtor-in-possession:
“may, based on reasonable due diligence in the circumstances of the case and taking into account a party’s known or reasonably knowable affirmative defenses under subsection (c), avoid any transfer of an interest of the debtor in property.”
The transfer still must meet the enumerated elements of a preferential transfer. In other words, the SBRA requires a trustee to take into account a target defendant’s potential affirmative defenses when determining whether to exercise the authority to commence an action to recover a preference.
The second provision addresses the venue where such preferential transfer actions might be commenced. The current law requires a preference action to be commenced in the district where the defendant resides if the amount sought to be recovered was less than $13,650. The SBRA increases the monetary threshold to $25,000.
Michael Pugh is an experienced associate with TOKN’s Bankruptcy, Business Law, and Litigation teams. To learn more about Michael, please visit his profile here. To contact Michael, please see his email above.
April Phillips is a valuable member of our team. Her ability to provide exceptional customer service through every situation is remarkable. Her smile is the first and last thing you see when visiting us and she is often the first voice you hear when contacting us.
April Phillips began as TOKN’s receptionist in November 2016. Her positivity, optimism, and ability to laugh make her a joy to work with for both employees and clients of TOKN. Additionally, April constantly goes above and beyond. She is quick to assist anyone in need of help, no matter what the task.
Team Member Spotlight Q&A:
Q: What are three random facts people might not know about you?
A: I like to go camping. I am ALWAYS up for a road trip, ALWAYS. Also, I am a Bananagram junkie.
Q: Where are you from?
A: I was born in Rochester, NY, but I was raised in Knoxville, TN. I am a Southerner.
Q: What do you like most about your job?
A: I like to assist others when they need help. Such as, helping with the deposit, entering payment, proof-reading, data entry, etc. I also really like to say hello to so many people!