New Orleans sales last week. High of $1.

New Orleans sales last week. High of $1.53 million to a low of $26,000. Real estate remains hot in New Orleans. http://ow.ly/HOZT300uMPm

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Former HUD secretaries: America’s elder

Former HUD secretaries: America’s elderly desperately need more affordable housing http://ow.ly/ZoY8300uc0d

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Interesting article regarding the financ

Interesting article regarding the financial backing and subsequent operations of Fannie and Freddie Mac

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Closings remain at 44 days for second mo

Closings remain at 44 days for second month. http://ow.ly/LaNW300pMSs

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New FHA proposal puts reverse mortgages

New FHA proposal puts reverse mortgages above HOA super liens http://ow.ly/flGT300mW0i

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Gulf Coast Bank to expand to Dallas. htt

Gulf Coast Bank to expand to Dallas. http://ow.ly/hL2o300lWkv

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Mortgage Brokers Association (MBA) Presi

Mortgage Brokers Association (MBA) President calls for reform of Government Sponsored Entities (GSE) administration to ensure the secondary market is standardized and efficient. http://ow.ly/GKwN300kAND

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TRID has resulted in more homebuyers rep

TRID has resulted in more homebuyers reporting that they are reviewing the mortgage documents. The involvement of homebuyers is the process is resulting in smarter homebuyers. http://ow.ly/7kNC300kzW4

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Locally owned grocery store completes up

Locally owned grocery store completes update to facade for the first time in 31 years. http://ow.ly/vaQS300iMyP

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The Three Approaches Generally Used By Attorneys When Drafting Sub-Leases

There are countless reasons why an individual or a business entity would enter into a sub-lease of a property. Whether one is moving-in or moving-out, there are numerous legal implications that must be addressed prior to signing a sub-lease agreement. In general, attorneys use three approaches in drafting and reviewing sub-leases namely: the All-Inclusive Approach, Incorporation by Reference, or the Haphazard Approach.

The All-Inclusive approach is when an attorney will build an entirely new lease but utilizes the prime lease as a reference. Meaning, in drafting the new lease, the attorney is addressing all the rights and obligations of the three parties involved (original lessor, original lessee now the sub-lessor, and the sub-lessee).

The Incorporation by Reference approach is when the attorney incorporates the entire original lease into the sub-lease. Meaning, the original or prime lease is used as the basis of agreement except for any provisions or terms that are expressly excluded or qualified by the sub-lessor and sub-lessee. This approach assumes the validity of the original or prime lease but also qualifies what obligations remain with which party.

The Haphazard approach is when an attorney changes the lease form to say sub-lessor and sub-lessee and inserts terms such as prohibiting each party from causing default under the primary lease. Largely, the parties are left wondering what the consequences or even the agreement really is in this approach.

Although these three approaches laid out above seem to be rudimentary and easy for anyone to apply, they assume an attorney level education and experience that one cannot take for granted. If one were to only look at the terms of a lease, one can see the legalese runs rampant and making the consequences widely unknown for breaches to the ordinary person. Thus, an individual must not take any provisions of a lease lightly as the legal consequences can vary in such capacities up to and including permanent harm to the individual or business entity.

Therefore, the three approaches generally used by attorneys in sub-leases drafting and review may seem basic and unsophisticated but in fact are quite the opposite. Be sure to consult a qualified attorney for your lease and sub-lease issues prior to signing the document. It is wise to always remember that person who negotiates more of the relationship upfront will be the one who spends less when a breach has occurred and often is in control of the outcome.

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