Inventories have been falling amid stronger demand from home buyers, which are helping to firm up prices. The decline in inventory has frustrated home buyers who are not able to bid down prices for the first time in a long time.  This inventory decline is helping sellers who are now moving their houses at a slighter faster pace. 

Additionally the Census Bureau said that housing starts rose a remarkable 15 percent in September, to their highest rate since July 2008. Analysts had forecast a 2.7 percent gain. The number of housing permits also rose at a double-digit rate, 11.6 percent, compared with the 1.1 percent forecasters were predicting.

This latest news has prompted more and more economists to state that the housing industry has finally bounced off the bottom and that the market is indeed rebounding.

U.S. home prices have dropped by a third from the start of 2007 to the start of 2012.  Forecasters are predicting that the average pricing for housing will increase 3.7% a year for the next five years. At that forecasted growth rate, the national average high from 2007 would not be hit again until 2023

And for some areas like the metro Dalton area it could take even longer.

Of course the decrease in for sale inventory is the driving factor in this equation according to the panel of economists reported on in the Journal.  With the number of vacant homes is at its lowest point since 2006 the housing market has finally turned north.

However just because we have hit “bottom” there is still a long way to go for a full recovery. In particular, more than one in every four home owners with mortgages are still underwater. Also the shadow inventory of unsold homes and foreclosures still threaten the momentum of the recovery as well.

But this news of hitting bottom does mean that from this point on the United States housing market is unlikely to drag the U.S. economy down further.

Recently the FHA’s rules have become overly strict. Barely 25 percent of all condo projects that are potentially eligible for FHA financing are now approved.

The largest restrictions imposed by FHA include non-owner occupancy rules requiring 50% of the units in a project or building be non-owner-occupied, and the FHA rule that requires that 85% of the units be current on their dues. FHA also sets a cap of 25 percent of the total floor space in a project for commercial use and has a very controversial rule which creates severe legal liabilities for condo board officers including personal liability and criminal responsibility.

FHA is expected to clarify the personal liability language and make other modifications in its forthcoming rules.  Time will tell if the rules will encourage condominium boards to apply for approval by FHA.

Of course regional variations in how quickly servicers can clear the backlog of nonperforming loans are primarily due to differences in foreclosure procedures.  Georgia and Tennessee are non-judicial foreclosure states, meaning that a foreclosure can occur without the lender filing suit against the debtor.  Most experts think it takes two and a half times as long to foreclose property in a judicial foreclosure state.

The shadow inventory includes all outstanding properties on which the mortgage payments are 90 or more day’s delinquent, properties in foreclosure, and properties that are already owned by the banks.  The shadow inventory as calculated by S&P also includes 70 percent of the loans that became current, or “cured,” from 90-day delinquency within the past 12 months because S&P says these loans are more likely to re-default.

The U.S. Court of Appeals for the District of Columbia issued an injunction last week preventing the rule from taking effect.  The Court ruled that a legal question needed to be resolved before the rule could take effect: does the NLRB have the authority to require employers to post such a notice?  Last week, a federal judge in South Carolina determined that the NLRB exceeded its authority when it approved the poster requirement.

For now, employers do not have to purchase the NLRB poster and those that have can leave them in the closet on April 30^th – but do not throw them away – this battle is far from over!  Check back here for updates on the NLRB poster rule and other important developments in employment law.

Generally speaking, retaliation claims are easier to prove than discrimination claims; a point not lost on the Plaintiffs’ bar.  Additionally, over the past few years court decisions have opened the door for even more retaliation charges to be filed.

Two 2011 decisions by the U.S. Supreme Court continued this trend.  In Thompson v. North American Stainless, LP, the Supreme Court held that it was impermissible retaliation for an employer to terminate the fiancée of a complaining employee, opening the door for third-parties to assert charges of retaliation.

In Kasten v. Saint-Gobain Performance Plastics Corp., the Supreme Court held that an employee’s oral complaint of a wage and hour violation was afforded the same protection as a written complaint.  This decision means employers must now also be mindful – and should keep records of – any oral complaints by employees that could lead to retaliation claims.

For more information on handling and preventing retaliation claims, please contact Theo Lu at (706) 259-2586 or click on the email link on his bio page.

1. Does the FMLA apply to my company?
   Answer:  The FMLA only applies to employers with 50 or more employees.
2. Which employees are eligible for unpaid leave under the FMLA?
   Answer:  Employees who have been employed with the company for a total of 12-months, worked a minimum of 1,250 hours within the last 12-months, and work at a location with 50 or more employees within a 75 mile radius are eligible for FMLA leave.
3. How much leave unpaid FMLA leave are eligible employees entitled to?
   Answer:  Eligible employees are entitled to 12 weeks of unpaid, job-protected leave during a 12-month period.
4. When can an employee take FMLA leave?
   Answer:  Generally, there are three reasons (1) The birth or care of a newborn, and the placement of a child for adoption or foster care (both men and women are eligible); (2) the employee’s own “serious health condition” that makes the employee unable to perform their job; (3) to care for a spouse, child or parent with a “serious health condition”.
5. What is considered a “serious health condition”?
   Answer:  The FMLA defines a “serious health condition” as “"illness, injury, impairment or any physical or mental condition that requires inpatient medical care or continuing treatment by a health care provider.”  While this definition is vague and open for interpretation, employers do have the right to request that the employee provide medical certification from a doctor when the employee requests FMLA leave for his or her own serious health condition, or the serious health condition of his or her parent, spouse or child.    
6. What does the FMLA require or prohibit an employer from doing?
   Answer:  When an eligible employee returns from FMLA leave, the employer must return them to the same position, or an equivalent position, with equal pay, benefits and perks.  An equivalent position must involve the same or substantially similar duties, responsibilities and authorities.  Covered employers cannot: (1) prevent eligible employees from taking FMLA leave; (2) consider FMLA leave as a negative factor in any employment action (hiring, firing, promotion or discipline); or (3) retaliate against  employees who request FMLA leave or complain about a violation of the FMLA.

Bonus Question – Are there special provisions for military families?
Answer:  YES!  The spouse, child, parent or next of kin of a “covered active duty” service member can take leave for a “qualifying exigency”.  A “qualifying exigency” is a specific activity arising out of the fact that a covered military member is on active duty, including issues related to short notice deployment, making financial and legal arrangements, arranging childcare, attending counseling, and post-deployment activities.

            Under the military caregiver provision, the spouse, child, parent or next of kin of a covered service member, including the National Guard or Reserves, can take leave to care for the service member who incurred a serious injury or illness in the line of duty.

            Employees taking leave under these provisions are entitled to a total of 26 weeks of unpaid, job-protected leave (including regular FMLA leave) during 12-month period.

This quiz is just a starting point.  There’s a lot more to the FMLA and compliance can be tricky.  So if you had trouble answering any of these questions or you’d like some additional guidance, please contact Theo Lu at (706) 259-2586 or click on the email link on his bio page. 

A recent study showed that there is mass confusion over what the role of an executor actually entails.  Start your decision making process by considering the fiduciary nature of the position and its duties.  These include: having the Will probated (proven), gathering and inventorying  the assets of the estate, determining the valid debts and liabilities of the Estate, filing tax returns, paying the estate’s taxes and valid obligations, settling business interests, filing (unless waived) an accounting with the probate court, distributing property to intended beneficiaries, including making decisions as to what and how to distribute (e.g. distribute an asset with equal value to all equal beneficiaries, or distribute ownership of all or some of the assets to all equal beneficiaries).

There are three general types of people to choose as your executor:  (1) a family member or close friend (2) a professional, or (3) a hybrid of the two.  What to consider in selecting the best option for your situation?

(1)    Individuals (Family Member or Friend)

You can name any person you want to as your executor as long as they are over age 18 and are mentally competent.  The individual is generally your spouse, a sibling, an adult child, or a friend.  They technically need not have any special training but there is some preferred knowledge and character traits that should be considered.

You should choose someone who is responsible, trustworthy, and is comfortable working with professionals such as lawyers and accountants.  The person shouldn’t be a procrastinator.  You want somebody who will do the work and not get mixed up with the emotional aspects.

Remember that the executor’s position is a job and the executor is entitled to reasonable compensation.  Sometimes, if an attorney is assisting, a family member who acts as executor will forego payment or be paid hourly by the estate for his or her work.

Talk with your potential individual executors.  It’s not the best practice to just surprise someone with the job title after your death.

You can name two or more executors (i.e. co-executors) but selecting multiple non-professionals to serve as co-executors may bring more challenges than you intend.  Be aware that each will have to sign court filings and other important documents throughout the entire process (which can be anywhere from several months to several years).  They will also have to make unanimous decisions on all issues.  There is nothing worse than a deadlock.

Do you reasonably feel that your co-executors can collaborate together and still meet the necessary deadlines?  They may be on good terms today, but what about in the future?

If you have dysfunction in your family (and who doesn’t?), naming multiple individuals who can’t get along today as your co-executors will not inspire a sense of togetherness.  Given the way family dynamics work and the complexity of your estate, if you want co-executors, it may be best to select a professional to serve as co-executor with an individual.

To Be Continued – Part 2 will cover the pros and cons of a Professional Executor and Hybrid Executors.

This is the latest news in the continuing saga of what role the mortgage giants Fannie Mae and Freddie Mac will play in this country’s residential housing future, and is the latest news in the fight over how many defaulted mortgages Bank of America will have to buy back from Fannie Mae because the original loans had not conformed to proper underwriting standards.

In mortgage circles this is huge news.  Bank of America was Fannie Mae’s third-largest provider last year and the bank originated $156.1 billion in mortgages last year of which $37.7 billion were sold to Fannie Mae.

Meanwhile, Fannie and Freddie face questions over what role they will play in the housing market.  On February 21st the Treasury Department’s new housing reform report was issued, and the report concluded that Fannie Mae and Freddie Mac must be eliminated - period.

Of course if Fannie Mae and Freddie Mac are eliminated most economists expect that average interests would increase and that it would be harder to obtain a traditional 30 year fixed rate mortgage.