Few things are more frustrating than finding that your home was built with some type of defect. These defects may not be discovered for many years down—long after explicit warranties have expired. In most cases, even your homeowners insurance will not help you recoup the costs to fix the construction defect.

Your Insurance Might Not Cover You for Construction Defects

The typical homeowners insurance policy is intended to protect homeowners from specifics types of losses. Such a policy will generally cover the structure of the home, as well as other buildings on the owner’s property, such as a detached garage or tool shed. The policy will also usually cover replacement costs for personal property that is stolen or destroyed by a covered risk, such as a fire. Most homeowners policies also include a level of liability protection in the event that another person is injured while visiting the property.

However, homeowners insurance usually does not cover construction defects or poor workmanship. In fact, most policies contain language that specifically excludes any type of “faulty workmanship.” This leaves many owners of defective homes unable to collect from their insurance for the defects. Sometimes, their only option is to sue the general contractor or subcontractor.

Falling behind on your mortgage payments can lead to serious trouble. If you are far enough behind that you are in default, the lender could initiate foreclosure and eventually seize your home. During the foreclosure process, however, you as the borrower have certain rights, even though you are in default on your loan. One of these rights is the right to negotiate a reinstatement of your mortgage, which will stop the foreclosure proceedings.

Initiating Foreclosure

A single missed mortgage payment is probably not going to be a serious problem. Your lender will more than likely work with you to get your missed payment caught up, even if it means paying a little extra on each of the next few payments. Likewise, two missed payments can usually be taken care of in a similar manner. Once you reach a third missed payment, however, and venture into the period of 60 to 120 days late, your lender is likely to notify you that your mortgage is in default. The lender will also send you a notice of intent to foreclose.

After you have passed the point of being 120 days late, you will probably be served with a summons and a copy of the civil complaint indicating that your lender has initiated foreclosure proceedings. In most cases, you will be served personally, but avoiding process servers or sheriff’s deputies will not stop the case from moving forward. If you cannot be served in person, your lender can file a public notice in the newspaper to serves as your formal notice. Once you have been notified, you have 30 days to respond. You also have 90 days during which you have the right to reinstate your loan.

If you are the owner of property that you lease to commercial tenants, you will almost certainly have to deal with lessees who fail to pay their rent on time. While you might offer grace periods or other ways to help your tenants, eventually, one or more of your tenants will probably reach a point where you start to wonder if they have stopped paying altogether. As a commercial landlord, there are a few things to consider and certain steps that you must take before you can begin the process of evicting a commercial tenant.

Reach Out and Talk

As with any human interaction, commercial leasing issues can often be resolved through open and honest communication. Maintaining open communication can catch small issues before they grow into major problems. If your tenant’s payment for the month is late, consider reaching out to find out what is happening. You could make a quick phone call, stop by the business, or even send a friendly text message asking if everything is ok, especially if your tenant has never had trouble paying on time before.

In your communication, ask if your renter’s financial situation has changed substantially. If your tenant has legitimate concerns about being able to afford the obligations of the lease, you might consider offering a modification to the agreement. Depending on the circumstances, you might even offer to let your tenant out of the lease. If you go this route, make it clear that your tenant only has a few days to consider your offer. You could be surprised at how fast he or she finds rent money.

If you are a homeowner, there is a good chance that you bought your home with a mortgage loan and that you make payments on your mortgage every month. If you are a renter, you make rental payments each month, but instead of making payments to a bank or lending institution, your rent goes directly to your landlord. Presumably, your landlord is using your payments to make payments of his or her own on the mortgage for the property in which you live.

You are most likely aware that failing to make your mortgage payments on a home that you own could result in foreclosure, with the bank seizing your home. Similarly, you know that failing to make your rental payments could result in eviction, with the landlord taking possession of his or her property. So, what happens when you make your rental payments each month but your landlord does not make his or her mortgage payments?

Continue to Make Payments

While it might be concerning to live in a building that is being foreclosed on, Illinois and federal statues provide protection for renters in such a situation. It is unlikely that your landlord will be forthcoming about his or her finances, so by the time you discover that he or she is facing foreclosure, the process could be well underway. Once you learn about the situation, however, your best options will probably be to continue making your rental payments in accordance with your lease.

When a person is looking to sell his or her home, he or she will usually enlist the help of a real estate broker to manage the deal. In some cases, however, a homeowner will forgo a broker and try to sell the home in a “for sale by owner” transaction, or a FSBO—pronounced “fizz-bo”—deal. If you are considering buying a FSBO property, you may be able to get great value for your money, but there are some risks that you should take into account.

Sharing the Workload

Real estate brokers are trained—and hired—to do much of the legwork involved in residential real estate transaction. In a FSBO situation, however, the owner will almost certainly not have the same level of experience or knowledge of the real estate world. This means that he or she might not provide you with all of the relevant information regarding the deal. While the oversight might be unintentional, you should be aware of it and be ready to take on some additional responsibilities in exchange for the lower price that is typically part of a FBSO purchase.

Likewise, paperwork might also be delayed. Be prepared for things to take longer than you originally expected. It is also a good idea to have a qualified attorney on your side who can help you research prior insurance claims on the home, title concerns, and other considerations that could affect your willingness to purchase the property.