“ Practical examples, explanations of legal principles, and useful tips ” LIBRARY JOURNAL N O L O 8th Edition OVER 50,000 IN PRINT 50,000 50,000 IN PRINTIN PRINT Nolo’s Encyclopedia of Everyday Law Shae Irving, J.D. & the editors of Nolo Answers to Your Most Frequently Asked Legal Questions Free Legal Updates at Nolo.com ® e Story Dear friends, Founded in 1971, and based in an old clock factory in Berkeley, California, Nolo has always strived to off er clear legal information and solutions. Today we are proud to off er a full range of plain-English law books, legal forms, software and an award-winning website. Everything we publish is relentlessly researched and tested by a dedicated group of in-house legal editors, who together have more than 150 years’ experience. And when legal changes occur after publication, we promptly post free updates at Nolo.com. Tens of millions of Americans have looked to Nolo to help solve their legal and business problems. 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Nolo’s encyclopedia of everyday law : answers to your most frequently asked legal questions / by Shae Irving & Nolo editors. 8th ed. p. cm. Includes index. ISBN-13: 978-1-4133-1321-5 (pbk.) ISBN-10: 1-4133-1321-3 (pbk.) ISBN-13: 978-1-4133-1347-5 (e-book) ISBN-10: 1-4133-1347-7 (e-book) 1. Law United States Popular works. 2. Law United States Miscellanea. I. Irving, Shae. II. Nolo (Firm) III. Title: Encyclopedia of everyday law. KF387.N65 2010 349.73 dc22 2010031328 Copyright © 1996, 1999, 2002, 2003, 2005, 2008, and 2011 by Nolo. All rights reserved. The NOLO trademark is registered in the U.S. Patent and Trademark Offi ce. Printed in the U.S.A. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise without prior written permission. Reproduction prohibitions do not apply to the forms contained in this product when reproduced for personal use. For information on bulk purchases or corporate premium sales, please contact the Special Sales Department. Call 800-955-4775 or write to Nolo, 950 Parker Street, Berkeley, California 94710. Please note We believe accurate, plain-English legal information should help you solve many of your own legal problems. But this text is not a substitute for personalized advice from a knowledgeable lawyer. If you want the help of a trained professional—and we’ll always point out situations in which we think that’s a good idea—consult an attorney licensed to practice in your state. Dedication For Edward F. Dolan Acknowledgments Thanks to Jake Warner for inspiring and supporting this project. And thanks to all the Nolo editors and hardworking production folks who keep the book on track. We’re also grateful to every Nolo author whose fine work has shaped these pages. You’ll find many of these talented individuals listed in the Contributors section on the following page. But we want to give special thanks to: Paul Bergman and Sara Berman-Barrett, authors of Represent Yourself in Court and The Criminal Law Handbook David W. Brown, author of Beat Your Ticket: Go to Court & Win! Denis Clifford, author of many Nolo titles, including The Quick & Legal Will Book, Nolo’s Simple Will Book, and Make Your Own Living Trust, and coauthor of Plan Your Estate and A Legal Guide for Lesbian & Gay Couples Frederick W. Daily, author of Stand Up to the IRS and Tax Savvy for Small Business. Stephen R. Elias, author of numerous Nolo books, including The New Bankruptcy: Will It Work for You?, Special Needs Trusts: Protect Your Child’s Financial Future, How to File for Chapter 7 Bankruptcy, and Legal Research: How to Find & Understand the Law Cora Jordan, author of Neighbor Law: Fences, Trees, Boundaries & Noise and coauthor (with Denis Clifford) of Plan Your Estate Mimi Lyster Zemmelman, author of Building a Parenting Agreement That Works: Child Custody Agreements Step by Step. Anthony Mancuso, author of Incorporate Your Business, How to Form a Nonprofit Corporation (national and California editions), Form Your Own Limited Liability Company, The Corporate Records Handbook, and LLC or Corporation? Joseph Matthews, author of How to Win Your Personal Injury Claim and Long-Term Care: How to Plan & Pay for It, and coauthor (with Dorothy Matthews Berman) of Social Security, Medicare & Government Pensions Fred S. Steingold, author of The Legal Guide for Starting & Running a Small Business and The Employer’s Legal Handbook Contributors Ilona Bray Ilona’s legal background includes solo practice as well as experience in the nonprofit and corporate worlds. She has written or coauthored several Nolo titles, including Effective Fundraising for Nonprofits, Becoming a U.S. Citizen, and Nolo’s Essential Guide to Buying Your First Home. Catherine Caputo Before joining Nolo, Cathy was an attorney in private practice assisting start-up and small business clients with a wide range of legal needs. She edits small business books and software and also focuses on issues affecting seniors, such as Social Security benefits and retirement. Cathy received her law degree, with honors, from the University of San Francisco School of Law. Amy DelPo Amy has been an editor at Nolo since January 2000. She specializes in workers’ rights, sexual harassment law, employment law, criminal law, and civil litigation. She brings more than six years of criminal and civil litigation experience to her work at Nolo, having litigated cases in all levels of state and federal courts, including the California Supreme Court and the United States Supreme Court. Amy received her law degree, with honors, from the University of North Carolina at Chapel Hill. Emily Doskow Emily is a Nolo author and editor, and a mediator and attorney in private practice in Berkeley, California, specializing in adoption and family law, especially for same-sex couples. She is the coauthor of several Nolo books, including Nolo’s Essential Guide to Divorce, The Sharing Solution, A Legal Guide for Lesbian & Gay Couples, and How to Change Your Name in California. Diana Fitzpatrick Diana worked on municipal finance issues at the San Francisco City Attorney’s office before joining Nolo. She also worked at a law firm in New York for several years before moving to the Bay Area. Diana is a graduate of New York University School of Law and Barnard College. Lisa Guerin During her years as a law student at Boalt Hall School of Law at the University of California at Berkeley, Lisa worked for Nolo as a research and editorial assistant. After a stint as a staff attorney at the U.S. Court of Appeals for the Ninth Circuit, Lisa has worked primarily in the field of employment law, in both government and private practice. Lisa rejoined Nolo in 2000 and is the coauthor of several employment titles, including Create Your Own Employee Handbook and Dealing With Problem Employees. Shae Irving Shae graduated from Boalt Hall School of Law at the University of California at Berkeley in 1993 and began working for Nolo in 1994. She has written extensively on durable powers of attorney, health care directives, and other estate planning issues. She is the managing editor for Nolo’s Quicken WillMaker Plus software. Bethany K. Laurence Beth graduated from Hastings College of the Law at the University of California in 1993. She spent several years working for a corporate legal publisher before coming to Nolo. She joined Nolo’s editorial staff in 1997 and has never been happier. Beth is the coauthor of Nolo’s Business Buyout Agreements and the editor of many of Nolo’s small business books. Janet Portman Janet received under graduate and graduate degrees from Stanford University and a law degree from the University of Santa Clara. She was a public defender before coming to Nolo. Janet is Nolo’s managing editor, the author of Every Landlord’s Guide to Finding Great Tenants, and the coauthor of many Nolo titles, including Every Landlord’s Legal Guide, Every Tenant’s Legal Guide, Renters’ Rights, and Negotiating the Best Lease for Your Business. Mary Randolph Mary has been editing and writing Nolo books and software for more than a decade. She earned her law degree from Boalt Hall School of Law at the University of California at Berkeley, and her undergraduate degree at the University of Illinois. She is the author of Deeds for California Real Estate, The Executor’s Guide, and other Nolo materials. Alayna Schroeder Alayna graduated from the University of California, Hastings College of the Law, and worked as an employment attorney before joining Nolo’s staff in 2005. In addition to editing employment and real estate titles, she is coauthor of Nolo’s Essential Guide to Buying Your First Home. Betsy Simmons-Hannibal Betsy is a Nolo editor specializing in estate planning books and software. She graduated with The Honors Lawyering Program from Golden Gate University School of Law where she was research editor of the law review. Prior to joining Nolo, she trained at two private law firms as well as the San Francisco Superior Court and the Federal District Court of Northern California. Marcia Stewart Marcia is an expert on landlord-tenant law, buying and selling houses, and other issues of interest to consumers. She is the coauthor of Nolo’s Every Landlord’s Legal Guide, Every Tenant’s Legal Guide, Renters’ Rights, and Leases & Rental Agreements, and editor of Nolo’s LeaseWriter software for landlords. Richard Stim Rich graduated from the University of San Francisco Law School and worked in private practice for 16 years until joining Nolo as an editor in 2000. He is the author of Profit From Your Idea, Getting Permission, and Music Law, and is the coauthor of Patent Pending in 24 Hours. Ralph Warner Ralph is a cofounder of Nolo. He is the author (or coauthor) of a number of Nolo books, including Every Landlord’s Legal Guide, Everybody’s Guide to Small Claims Court, Form a Partnership, and Get a Life: You Don’t Need a Million to Retire Well. Ralph is a lawyer who became fed up with the legal system and dedicated his professional life to making law more accessible and affordable to all Americans. ● [...]... 14 | Nolo’s Encyclopedia of everyday law house’s value A number of companies also offer detailed comparable sales prices online though the information isn’t always as recent as you might need See the list of recommended websites at the end of this chapter Public record offices, such as the county clerk or recorder’s office, may also have information on recent house sales The asking prices of houses still on... what’s most important is the substance of the deed: the description of the property being transferred and the names of the old and 18 | Nolo’s Encyclopedia of everyday law new owners Here’s a brief rundown of the most common types of deeds: A quitclaim deed transfers whatever ownership interest you have in the property It makes no guarantees about the extent of your interest Quitclaim deeds are commonly... collect their fee from the lender, not from you 6 | Nolo’s Encyclopedia of everyday law What are my other options for home loans? You may also be eligible for a governmentguaranteed loan, offered by: • the Federal Housing Administration (FHA), an agency of the Department of Housing and Urban Development (HUD) (see www.hud.gov) • the U.S Department of Veterans Affairs (see www.homeloans.va.gov), or • a... Prudential, and others offer home listings on their websites Virtually all online editions of newspapers offer a homes-for-sale classifieds section 8 | Nolo’s Encyclopedia of everyday law that works much like an online listing site On most newspaper sites, you can browse all the listings or customize your search by typing in your criteria, such as price range, location, and number of bedrooms and baths... author of The Complete Guide to Your Real Estate Closing (McGraw-Hill), offers 20 | Nolo’s Encyclopedia of everyday law FAQs and articles on this key part of the purchase process • www.homegain.com HomeGain is geared toward home sellers It provides an agentevaluator service to help you find a real estate agent, a home-valuation tool to help price your home, calculators for a wide variety of tasks,... hazards such as asbestos, mold, and lead 10 | Nolo’s Encyclopedia of everyday law In most states, these professional inspections are done after you and the seller have signed a purchase agreement (Your purchase should be contingent upon the house passing one or more inspections.) To avoid confusion and disputes, be sure you get a written report of each inspection If the house is in good shape, you... an in law unit to get rental income 8 Lease a house you can’t afford to buy now with an option to buy later 9 Buy a limited-equity house built by a nonprofit organization 10 Buy a house at a short sale (where the seller’s mortgage is higher than the value of the loan, and the lender agrees to accept a lower amount from a willing buyer) 11 Buy a house at an auction 12 | Nolo’s Encyclopedia of everyday. .. type of legal relationship you have with an agent or broker; typically, the seller pays the commission of his or her listing agent, who splits it with of the real estate salesperson who helps the buyer locate the seller’s house The total commission is a percentage (usually 5–6%) of the sales price of the house (so 2.5–3% per agent) What this means is that your agent or broker has a built-in conflict of. .. estimates Do I need to take the first offer that comes in? You’re under no obligation to accept the first or any other offer (except in a few states where you must accept a full price offer that has no contingencies) In fact, offers, even very attractive ones, are rarely accepted as written More typically, you will negotiate to accept some, maybe even most, of the offer terms, while also proposing certain... states, particularly in the eastern part of the country, attorneys have a more active role in all parts of the house transaction; they handle all the details of offer contracts and house closings Check with your state department of real estate or your real estate broker for advice ChaPter 1 | Houses | 17 I’m selling my house and buying another What are some of the most important tax considerations? . explanations of legal principles, and useful tips ” LIBRARY JOURNAL N O L O 8th Edition OVER 50,000 IN PRINT 50,000 50,000 IN PRINTIN PRINT Nolo’s Encyclopedia of Everyday Law Shae Irving,. University of San Francisco School of Law. Amy DelPo Amy has been an editor at Nolo since January 2000. She specializes in workers’ rights, sexual harassment law, employment law, criminal law, . and software for more than a decade. She earned her law degree from Boalt Hall School of Law at the University of California at Berkeley, and her undergraduate degree at the University of