Avoiding Buyer’s Remorse

Online real estate company, Trulia, performed a study indicating roughly 44% of Americans have buyer’s remorse after buying a home. The biggest purchase you will ever make is most likely buying a home. Due to the magnitude of this investment, what steps should be taken to keep you from becoming one of the 44% after closing?

Create a Realistic Budget: Establish a budget that encompasses all hidden significant costs, including mortgage payments, property taxes, and maintenance costs. Doing this will give you a complete view of your financial commitment and prevent overspending. There’s more to homeownership than paying the basic principal and interest

Create a Wants and Needs List: Sit down and put together a list of must-haves and nice-to-haves for your ideal home, like location, size, and amenities. This list will keep you centered on what truly matters during the home search, helping to avoid hasty decisions. An example – If you have children and are planning on having more, buying a home in a good school system is a need.

Learn the Neighborhood: It’s critical when buying a home that you always consider the location of the home. What is the proximity to highways, parks, schools, and railroad tracks? Is this a forever home or a transition home? If you’ll be moving again, you’ll want to be in an area where the market is projected to go up over the next few years.  Visit the home at different times of the day and under various weather conditions. This will help you to really see the neighborhood, traffic patterns, and overall environment.

Be Patient: Avoid rushing into a decision simply to secure a property. Take your time when searching for a home and making an offer. Patience will help you wait for the right opportunity to present itself, minimizing the risk of future regret. Know that the entire home-buying process may come with various unexpected challenges and setbacks. Be flexible and adapt so you are able to navigate any hurdles.

The Bottom Line: Always trust your gut during the search for a home. Rushing into a home that just does not feel right will never be a good decision. Don’t be rattled by what is going on around you, how many offers a home has, or the fear that you may lose out on a home. If you are in a situation where you’ll be without housing soon, you may have to make sacrifices. If that is not the case and you are in a home, absolutely listen to your gut and pass on homes that give you a bad feeling, are too pricey, or just aren’t giving you enthusiasm. Your home should be your refuge, not a place full of regret.

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True Story: You Need Title Insurance

MYTH: You don’t need title insurance

Everyone needs title insurance. You may think you know the entire history of the house you’re purchasing, but it’s impossible to know everything. Title insurance protects your right to the property in the event that a previously unknown heir claims ownership of the property if it is later revealed that the “sellers” were not the rightful owners, or if liens against the property resurface. If you have an owner’s title insurance policy, you will not be responsible for paying any of the fees associated with protecting your right to the property, should these types of issues arise.

MYTH: New construction homes don’t need title insurance

Your home could be brand new, but the land on which the house is built isn’t. Chances are, the land had several previous owners before construction began. Buying property on such land opens you up to certain risks tied to ownership issues from previous owners.

Disputed wills, easements, and property liens are just a few of the issues common to land ownership. You could get caught in the mess and end up losing your resources or, worse still, your new property as well. Title insurance is crucial even for a new home and should be on your list of priorities during the closing process.

MYTH: If no one challenges ownership, then the title policy is a waste

At the closing, when you purchase a title insurance policy, the closing company does the bulk of the work behind the scenes. The title company goes through many steps to make sure that everything is in place by that time, including conducting a comprehensive title search and identifying any potential issues. The team investigates the entire history of the property to ensure that you, the buyer, will be aware of any problems that will need to be addressed before closing. By the time the closing comes around, the title company has completed a great deal of research and legwork for you.

MYTHTitle insurance offers only minimal protection

When you purchase a home, you receive the “title” to the property. This title is your legal right to own it. Early in the home-buying process, a title search is conducted to review the history of the property and uncover any issues that could limit your right to ownership. Even after the most meticulous search of public records, there can be hidden title defects, such as tax liens, forged signatures, claims by ex-spouses, and recording errors. These title defects can remain undiscovered for months or even years after you purchase the home.

MYTH: Title insurance is the same thing as homeowner’s insurance

Homeowners insurance protects you so you have the resources to pay for any damage that might occur to your property. Title insurance protects you from anyone else claiming your home is theirs or for some prior owner’s back taxes or encumbrances or any other real property dispute

Title First Agency: Dedicated to innovation and passionate about service, Title First Agency is your comprehensive, nationwide resource for title and real estate settlement services. Headquartered in Columbus, Ohio, Title First has branch offices throughout the Midwest and a robust virtual partner network throughout the country. Title First got its start in 1956 as an affiliate of a local law firm and has since emerged as one of the largest independent title agencies in the nation. Proudly servicing Realtorslendersbuildersdevelopers, law firms, buyers and sellers, Title First is equipped to serve your residential and commercial title and settlement needs.

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Some Warning Signs You Might Be Making a Bad Real Estate Investment

Real estate investing comes with plenty of pros and cons to consider. It’s especially important to evaluate the situation and the property that you are attempting to put an offer on and eventually buy. How do you identify if there are any signs that you might be jumping into a bad investment?

It’s important to know that when a realtor shows excitement in selling you a property, it is literally their job to do so. However, if they seem overly avid or even pushy, there might be some details about the property that could make it hard to sell which is making the realtor a bit extra aggressive to sell it. Listen to your instincts and, if necessary, investigate as much as you need to ensure you are making a good investment. Have the property fully inspected before agreeing to sign anything. Realtors should be truthful and upfront, offering their professional guidance on the best course of action, even if it’s not what you were expecting or hoping to hear.

One of the most important factors that determine if a property is worth investing in is the location. Even if the property is in a perfect state, if it’s poorly located, chances are you will be losing money. Some of the factors that determine a location are the local economic health, the levels of vandalism and crime, the school district, etc. Before coming to a final decision, make sure you do a thorough investigation of the location. Choose areas, for instance, that have great schools, fun attractions, quality transportation options, high walkability, and great retail spots. Proceed with caution—no matter how the numbers look on paper.

If a property has been on the market for six months or longer, other investors have probably checked it out. There’s a reason it’s not selling. It could be a bad neighborhood, or too many issues to fix, whatever the reason…a property that has been for sale for months and hasn’t sold might be too much trouble than it’s worth. Dig deep into why it has been for sale for far too long to find out why exactly. While it’s possible for a property to simply evade the attention of other prospective buyers and investors, this isn’t the most likely explanation for a listing that’s been up for a long time. If it seems like there’s no interest in a given property, it’s a red flag that there isn’t sufficient market demand for that type of investment.

A property can look good on paper and still be a bad investment. If a house has structural damage, foundation issues, or other problems that will require a long inventory cycle or cost so much that it will eat into your profits, then your best bet is to walk away. Considering renting out the home? If the plumbing, electricity, and other infrastructure will need constant and frequent repairs, it could be a bigger headache than it’s worth.

Thinking to the future not only on the property you are interested in but to its surroundings as well. Learning of the current and potential growth in an area can greatly benefit any investor. Visiting the municipal planning department can yield information on developments and project plans that have already been zoned into the area. 

One important consideration is the amount of new construction in the area. Lots of new planned projects and those still in development typically represent an area of substantial growth. If you will be renting out the property that would mean new tenants with the growth of the area.

The Bottom Line:  These are just a few signs on how to spot a bad investment. Nobody wants to deal with the fallout after a bad real estate investment, so you must do everything you can to minimize your risk and do a lot of investigating on each property. Arm yourself with a good realtor, access to information, and patience.

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Closing Time

Closing on a house is the most rewarding part of the home-buying experience. This is a time to celebrate this important milestone in your life! And it’s the last step in buying your new home. The actual closing and paperwork can be tedious and sometimes a little overwhelming. What should you expect once the seller accepts your offer? The behind-the-scenes work begins and then you can expect closing to happen within 30 to 90 days.

  1. Select a Closing Agent: If you are working with a realtor, with your permission, he or she may place an order with a closing agent as soon as your sales contract is accepted. The closing agent can be a title company, an escrow company, or a settlement company. Most homebuyers rely on their real estate agents to select a closing agent – someone they work with regularly and know to be professional, reliable, and efficient. The closing agent will oversee the closing process and make sure everything happens in the right order and on time, without unnecessary delays or glitches.
  2. Draw up an Escrow Agreement: First, a contract or escrow agreement is drafted, which the closing agent reviews for completeness and accuracy. The agent will also put your deposit into an escrow account, where the funds will remain until closing.
  3. Title Search is Conducted: Once the title order is placed, the title company conducts a search of the public records. This should identify any issues with the title such as liens against the property, utility easements, and so on. If a problem is discovered, most often the title professional will take care of it without you even knowing about it. After the title search is complete, the title company can provide a title insurance policy.
  4. Shop for Title Insurance: There are two kinds of title insurance coverage: a Lender’s policy, which covers the lender for the amount of the mortgage loan; and an Owner’s policy, which covers the homebuyer for the amount of the purchase price. If you are obtaining a loan, the bank or lender will typically require that you purchase a Lender’s policy. However, it only protects the lender. It is always recommended that you obtain an Owner’s policy to protect your investment. The party that pays for the Owner’s policy varies from state to state, so ask your settlement agent for guidance. before closing.
  5. Obtain a Closing Disclosure: Your lender must provide a Closing Disclosure to you at least three days prior to closing. Your lender may also have a closing agent provide the Closing Disclosure to you three days before you close your transaction. If your lender makes certain significant changes between the time the Closing Disclosure form is given to you and the closing, you must be provided a new form and an additional three-business-day waiting period after the receipt of the new form. This applies if the creditor: 1: Makes changes to the APR above 1/8 of a percent for most loans (and 1/4 of a percent for loans with irregular payments or periods) 2. Changes the loan product 3. Adds a prepayment penalty to the loan. If the changes are less significant, they can be disclosed on a revised Closing Disclosure form provided to you at or before closing, without delaying the closing.
  6. The Finish Line: Prepare for Closing: As closing day approaches, the closing agent orders any updated information that may be required. Once the closing agent confirms with the lender and the seller, he or she will set a final date, time, and location of the closing. On closing day, all of the behind-the-scenes work is complete. While you’ve been busy packing, ordering utilities, and coordinating the movers, your closing agent has been managing the closing process so that you can rest assured, knowing all the paperwork is in order.

The Bottom Line: This long process can seem daunting at times, but if you are teamed up with the best realtor and title agency you will be well prepared. When you finally reach the closing date and are holding the keys to the property, plan a celebration!

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