Closing Expectations

Your offer was accepted, the inspection is over, and anything that needed to be resolved has been. The only thing standing between you and moving into your new home is the closing table.  What should you expect?

PREPARING FOR THE CLOSING DATE:

Depending on how condensed your contract period is, you may receive the final settlement and HUD-1 statements with enough time to review them with your lender and real estate broker.  It isn’t uncommon, with the volume of new mortgages and refinances, to receive these documents just hours before closing.  Either way, you will have time at the closing table to have all your questions answered about the details and account for every penny of the transaction.

Prior to your closing, you will do a final walk-through of your new home with your broker to inspect its condition.  This is your opportunity to ensure all agreed-upon inspection items have been completed, the condition of the home hasn’t changed from when you went under contract, and all contractual items are in the home.  The final walk-through is not an opportunity to re-inspect the home.

WHAT TO BRING TO CLOSING

Make sure to bring a form of government-issued identification for the closing agent to verify you are, in fact, you.

You must bring funds that are immediately available for withdrawal, which includes wire transfers, cashier’s checks, or teller’s checks.  Title companies vary slightly as to what they will accept as good funds, so ask your Realtor before you gather documents. The actual dollar amount you will be required to bring to closing will be derived from the settlement statement prepared by the title company.

AT THE CLOSING TABLE

The closing is usually held at a title company location that is convenient to both parties of the transaction.  Most closings will include the seller and seller’s agent, buyer and buyer’s agent, lender, and the closing agent.  With more complex transactions there may be attorneys present for one or both sides.

There are three parts of the closing, the first two parts pertain to transferring the real estate from the seller to the buyer.  This includes all the documentation and accounting for the transfer.  If you are borrowing money, you will need to complete the third and final part, paying for the home.  This portion will contain the majority of documents and disclosures required by your lender.  Your lender should be present to answer any questions you may have during this section.

THE KEYS!!

Once all the documents have been successfully signed and all money dispersed, you are now the proud new owner of the home!  This will also be a good opportunity to ask the seller any additional questions you may have about your new property.  It is also a good idea to exchange contact information in case questions arise during the move-in process.

THE BOTTOM LINE

Though it may seem like the closing process is a lot of complex work, it’s worth the time and effort to get things right instead of hurrying up and signing a deal you don’t understand. Be wary of any pressure to close the deal fast. Real estate agents and other entities helping you will want their cut, but they won’t be around to care about the problems you could face in the long run from a bad deal.

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Title Insurance Myths

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 between 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 among 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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Should You Be Present During a Home Inspection as the Buyer?

Yes. The home buyer and the Realtor should attend the home inspection. A home inspection is a critical part of any home sale, and there are many misconceptions and often some confusion surrounding it. This is the best time for questions to ask and clarify items that will be included in the final report.

Buyers make an offer to purchase a home based on a few walk-throughs with their realtor. The inspector they hire will spend several hours thoroughly examining the house. If the buyer is not present, a golden opportunity is gone to see the home they intend to purchase through the eyes of an expert.

More often than not, the report will come back with a list of dozens of defects. Some can be quite expensive. There is no such thing as a perfect home, especially if the property is a few decades old. Don’t worry too much about the length of the list of problems; instead, pay attention to the severity of the problems. Many issues, such as loose doorknobs or cracks in the paved driveway, will be so minor you won’t bother fixing them right away, even though you know they’re there.

The following issues can be deal-breakers:

Faulty Electrical Wiring:
The electrical system is an important, and potentially hazardous, part of a home, which is why it is included in every thorough home inspection Newer homes have more supply of power and electrical outlets. Older homes do not. A good inspector should check the outlets throughout the home as well as check the interior of the electrical breaker/fuse box assuring that there are no “double taps” – two electrical circuits attached to a single breaker – as it is a fire hazard. The wires, conduits, and boxes should be securely fixed to the building. There should be no visible signs of damage or deterioration. There should be at least one ground rod or other approved grounding means present at the service.

Plumbing:
Some of these issues are obvious. Skilled inspectors are trained to find obvious, like a clogged toilet as well as the not so obvious, like illegal pipes that could result in being cited for plumbing violations. He will look around the entire home for signs of mildew, fungus, or mold related to water leaking from broken pipes and cracks in the ceiling or floor.    

Grading Toward the Home:
Water in the basement, damp or wet crawlspaces, foundation movement, cracking and settlement may all be caused by grading. Water in the foundation could lead to rot in the walls, framing members, and mold. Some indications of foundation movement include windows that are out of square; interior doors that have large, uneven gaps at the top when the door is closed; or floors visibly out of level. Some of the most experienced home inspectors believe that the most common issue they find during inspections is the lack of grading (improperly sloped soil) away from the home. 

Roofing:
A roof usually lasts about 30 years, so you will need to find out when it was installed. A home inspector will look at the quality of the shingles and know if any are curled, broken, or even missing which are signs that you might need a new roof soon.

The Bottom Line: A home inspection is the buyer’s last opportunity to discover problems with the house before purchasing. And it’s a chance for the seller to address those problems and negotiate pricing with the buyer.  If the buyer is present for the home inspection, the inspector can review his findings with the buyer directly and answer questions about the repair’s location and severity.

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Get Your Offer Accepted

After searching online real estate sites, visiting open houses, and going on tours with your Realtor, you’ve finally found your dream home. If you’re willing to pay the asking price, the process should be simple, efficient, and worry-free. But often it is not. In a seller’s market, there are more home buyers than there are homes on the market. Your full-price offer will probably have some competition, so how what are some ways you can craft it so that it lands the perfect home?

A qualified and knowledgable Realtor is important. He will be your right-hand man, especially when it comes to finding the perfect home, making an offer, and negotiating the sale. For the buyer, this is a very emotional, stressful process so it is important to let the Realtor guide and advise you. If you have researched and hired the best Realtor, he will have plenty of years of experience and plenty of deals under his belt, thus being your primary source when you make that offer.

Get your pre-approval letter that will show readiness to buy a home. Not only does it solidify how much house you can afford to buy, but it also helps you determine if you should buy a house for the total amount you’ve qualified for. Plus, when you can supply a preapproval letter with your offer, the seller knows you are a serious candidate and are ready to get the deal done. In competitive real estate markets, it’s basically guaranteed that you need a preapproval letter to have a chance at catching the seller’s eye. 

Limit the contingencies. Contingent offers are common because they protect the buyer from the conditions of unexpected repairs, insufficient value, and title defects. If any of the conditions aren’t met, either party can consider the contract null and void. Contingencies typically benefit the buyer, and you can’t expect a seller to get multiple offers to accept unnecessary contingencies. With multiple offers on the table, they have more leverage. 

Your Realtor should let you know, however, that there are contingencies you absolutely do not want to remove such as a home inspection. After all, the last thing you want is to purchase a home that you can’t afford the repairs for. Limiting contingencies can make your offer more appealing, but make sure you don’t give up too much. Again, your Realtor will be your guide on strategy and approach.

Offer earnest money, also known as a good faith deposit, to put down prior to closing. Not always required but a good idea to offer it to show the seller you’re serious. When a buyer and seller enter a purchase agreement, the seller takes their home off the market. If the buyer backs out and the seller needs to relist their home, it can be very costly and they might have missed out on more serious buyers. 

Earnest money protects the seller in case the buyer backs out of the agreement. Typically, it’s around one to three percent of the sale price and is held in an escrow account until the deal is finalized. If the deal goes through, the earnest money is then applied to the buyers’ closing costs or down payment. 

The Bottom Line: Over the past couple of years, the real estate market has been so hot that it’s not unusual for homes to go off-market in days. We are even seeing homes that need serious work breaking price records. It’s easy to feel pessimistic if you are a buyer. Don’t give up. Make sure you have the best Realtor as your wingman and know that the key to getting your offer accepted in a heated market is to present the easiest, stress-free scenario for a seller.

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Buy the Least Expensive Home in the Best Neighborhood

Imagine finding the home of your dreams for sale and it’s the most expensive home on the street. And, it’s in your price range. Are you about to score!? Be careful. Making an offer on the best house in the neighborhood may not be economical.

Why should you not be the one with the best house? It makes a lot more sense—financially, anyway—to buy one of the lesser homes in the neighborhood. Every improvement you make will add to its value and increase your equity—and you’ll have a pretty high ceiling here, figuratively speaking. When you buy the lesser home in the neighborhood, it becomes much easier for you to increase the value of your real estate investment.

Not every single home that is purchased will result in a profit – real estate, like any other investment, is a gamble. Buying a home is often the biggest investment you’ll ever make. So, regardless of everything, you still should look at it as that: an investment. Resale value should always stay top of mind. 

If you have the least expensive home in the neighborhood, the other homes will actually drive your home value up. But the opposite is also true. If you have the most expensive house, the other homes will drive your home value down. This is another reason why mid-range homes tend to have a higher price per square foot than the fancier homes down the street. 

If the market shifts, and it does about every 7 years, you may be stuck at the top of the market in your area. When times are tough, buyers will opt for a less expensive home in hopes of getting a better deal. 

Having a knowledgeable Realtor is so important.  They understand the importance of resale value while you search for your home. They have all the market information you need to make a good decision. If there aren’t any comps to support the high price tag it will be harder to get a bank loan (unless you have cash!) Your Realtor, if you have found a great one, will ask the listing agent where he or she based the listing price. Normally listing agents will list homes based on past sales in the immediate market area unless the sellers themselves set the list price.

The Bottom Line: Why let lesser valued homes in the neighborhood drag yours down? Buy the smallest house in the best neighborhood and let the neighbors’ values bring yours up. A low-end house can be upgraded to your own specifications to increase the value to the average of the area.

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A Few of the Worst Home Selling Mistakes

Bad Photos: It all begins online today. Buyers are looking for their future homes on the web before they go see it in person. Do some homework and investigate – find the best Realtor to hire that is competent with their internet marketing strategy. Beautiful photos fall on your real estate agent. But! You should know that bad photos can be an impediment to the sale of your home. Thus, as a seller, it’s imperative that you must demand great photographs of your home. Most potential buyers in your market will be exposed to your home the first day it hits the market. Avoid “photos coming soon” and if you have to – wait a day or two for the perfect photographs.

Overpricing: The most common mistake sellers make. The Realtor you hire will suggest a price at which to list your home based on comparable homes that have already sold in the market. Overpricing a home just to see if you can score big is not a strategy for anyone really serious about selling. Overpricing a home will lead to missed opportunities with buyers that looking in the range at which your home should be listed.

The first 30 days your home is on the market is when there are the most eyeballs looking and you have the most leverage as a seller. If your home is overpriced during this timeline to “see what kind of offer you can get” you will lose traffic and attention during the critical 30-day window.

Too Much Clutter: If you have hired the best Realtor, he/she will have absolutely walked through your home with you and directed on what and how to declutter. People feel space more than anything.  That’s why ten-foot ceilings make houses feel bigger than eight-foot ceilings, even though the square footage is the same.

Decluttering has the same impact.  It increases the perceived size of your home.  Whether it’s removing pictures from hallways, kitchen appliances from the counter, or removing the bathroom hairdryer, all of these things consume the perceived space in your home.  The phrase “less is more” is really true when it comes to showing your home.  It makes a difference in your buyers’ perception of how big your house feels.

Emotional Attachment: You love your house. You have a million memories stored. However, it’s time to emotionally detach let a new family take over your house when you’re selling. Do your best not to be offended by a hopeful buyer’s demands. Be willing to adjust in reasonable ways you might not want to in order to make the sale. Don’t ruin a selling opportunity because you refuse to leave a light fixture behind that the buyer really wants because you’re attached to it.

Making “Thrifty” Repairs: Even small defects can turn buyers off. If they walk through your home and find loose doorknobs, leaky faucets, or wall dings, they’ll wonder if you’ve been neglecting bigger issues in the home as well. Some sellers ignore major repairs in hopes of closing the sale before anyone notices. However, if the home inspector catches detrimental damage, it will likely halt the sale until repairs or an agreement can be made.

Hiring the Wrong Realtor: When listing a home much of the success lies with the real estate agent you choose. Don’t hire the first one you meet. Search their online presence. If friends are giving you names to get in touch with ask, “why?”. Why are they the best? What have they done that was impressive? Many sellers will hire an agent based solely on the list price given by the agent, only to be thoroughly frustrated and disappointed down the road. 

Look for an agent that is compatible and communicates effectively who backs up what they say with data and finally who has a strong marketing plan. Experience matters.

The Bottom Line: There will be challenges and obstacles along the way as you list your home for sale. With the right guidance, you can avoid these common home selling mistakes. Your decision on a Realtor will have a major impact on the results you get and how much money you walk away with.

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Enhance Your Home’s Value Quickly and Inexpensively

If you are ready to sell, there are plenty of ways of increasing your home’s value that doesn’t require an extensive renovation project or a ton of money.

Your ultimate goal is to gain the maximum return on investment in the least amount of time. DIY projects can help to accomplish the look you want while staying within your budget. Whatever your circumstances are for renovating, here are a few cost-effective home improvement tips to increase the value of your home. 

1. PAINT

One of the most simple, cost-effective improvements of all is paint! Paint makes the walls in your home look brand new! It’s easy, affordable, and incredibly valuable. By painting over all the scuffs and nail holes on your walls, you’re going to make your entire house feel cleaner and newer instantly.

To maximize value, choose a light, neutral color. By going with a light color, you help the home appear larger. And by sticking with neutral tones, you help the home appeal to as many buyers as possible.  

2. REPLACE FIXTURES

Outdating lighting and plumbing fixtures can drag down the entire vibe of a home. But by replacing the old fixtures with either timeless or trendy ones, you breathe fresh life into the space. 

If you’re planning to sell in the very near future, trendy fixtures will probably get you the best bang for your buck. But if it will be a little while before you sell, and you don’t want to have to replace the fixtures again before listing your home, it’s probably best to stick with timeless fixtures that won’t instantly date themselves. 

Make sure your fixtures match the property in both style and quality. HIgh-end homes require more expensive lighting fixtures while mid-range homes can be updated with less expensive fixtures.

3. GET SMART

Smart home technology has become increasingly accessible over the past decade and is in high demand by buyers. Smart locks, security cameras, thermostats, and lighting all make your home more valuable, especially to tech-savvy buyers.

These systems can usually be installed without hiring a technician, so you won’t need to wait weeks for an installer to come out. Instead, you can boost your home’s value this weekend by installing these smart systems yourself. 

4. BOOST CURB APPEAL

In a world where first impressions are everything, the entrance to your home is a big deal. Not only is this how people will perceive your home when arriving in person, but it also sets the tone for your listing photos when buyers view your home online. 

Cleaning the front entrance, adding a fresh coat of paint to the front door, and sprucing up the landscaping in the front of the home all enhance your home’s perceived value without much time, money, or effort.

5. INCREASE ENERGY-EFFICIENCY

Buyers love energy-efficient homes. Many buyers are environmentally conscious and appreciate homes that work to conserve energy. And buyers are also aware of the cost savings that accompany energy-efficient homes. Buyers are usually willing to pay a little more for a home when they know they can save money on their utility bills month after month.

The Bottom Line: If you are considering increasing your home’s value so you can sell for top dollar in the near future, reach out to the best Realtor in your neighborhood.

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Title Problems Revisited

Every property has a history of owners.  That history is called an ownership chain, or more often, a title chain.  When a link in the chain has a problem, it’s called a title defect, or a cloud on title.

When purchasing a home, you may view title insurance as an unnecessary cost.  However, title insurance provides protection for both the seller and the buyer against title defects. Title insurance, as the name implies, insures against property title defects or ownership defects.  Some title problems may not become apparent for years. Others can hinder the sale of your home, and may even limit who you can sell your home to.

Here are some common issues that a title search mighty uncover:

PUBLIC RECORDS: Mistakes and errors happen but you do not want it affecting your home. The errors can be disastrous and cause you an undue financial burden to resolve. Simple clerical or filing errors could affect the deed or survey of your property.

UNKNOWN LIENS: Prior owners of your property may have left unpaid bills. And, even though the former debt is not your own, banks or other financing companies can place liens on your property for unpaid debts even after you have closed on the sale. This is an especially worrisome issue with distressed properties.

ILLEGAL DEEDS: While the chain of title on your property may appear perfectly sound, it’s possible that a prior deed was made by an undocumented immigrant, a minor, a person of unsound mind, or one who is reported single but in actuality married. These instances may affect the enforceability of prior deeds, affecting prior (and possibly present) ownership.

MISSING HEIRS: When a person dies, the ownership of their home may fall to their heirs or those named within their will. However, those heirs are sometimes missing or unknown at the time of death. Other times, family members may contest the will for their own property rights. These scenarios – which can happen long after you have purchased the property – may affect your rights to the property.

FORGERIES: Unfortunately, we don’t live in a completely honest world. Sometimes forged or fabricated documents that affect property ownership are filed within public records, obscuring the rightful ownership of the property. Once these forgeries come to light, your rights to your home may be in jeopardy.

UNDISCOVERED ENCUMBRANCES:  At the time that you purchase your home, you may not know that a third party holds a claim to all or part of your property – due to a former mortgage or lien, or non-financial claims, like restrictions or covenants limiting the use of your property.

UNKNOWN EASEMENTS: You may own your new home and its surrounding land, but an unknown easement may prohibit you from using it as you’d like or could allow government agencies, businesses, or other parties access to all or portions of your property. While usually non-financial issues, easements can still affect your right to enjoy your property.

BOUNDARY/SURVEY DISPUTES: You may have seen several surveys of your property prior to purchasing, however, other surveys may exist that show differing boundaries. Therefore, a neighbor or other party may be able to claim ownership of a portion of your property.

UNDISCOVERED WILL: When a property owner dies with no apparent will or heir, the state may sell his or her assets, including the home. When you purchase such a home, you assume your rights as the owner. However, even years later, the deceased owner’s will may come to light and your rights to the property may be seriously jeopardized.

The Bottom Line: The experts at Title First oversee and perform thousands of closings each year. When using Title First, you can sign confidently on the dotted line knowing that all details of your title transfer and closing are in proper order. We are here to answer any questions you may have about buying or selling a home, and our team will guide you through the entire process.

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Emotionally Detaching From Your Home to Sell

According to the National Association of Realtors, the average number of years people stay in their homes is anywhere from 10-20 years. Owners and their families end up having great and often life-changing events and memories that happen under their roof. Their home is the biggest investment made and they become attached emotionally.

Having buyers come in and walk through their home, opening closets, cabinets, and drawers, walking through the bedrooms, looking behind furniture, and then criticizing (!!!) their beloved home can be soul-crushing.

Thus, the first hurdle to overcome after having made the decision to sell is to let go emotionally. Time to start looking at it as a positive financial opportunity and become distant from all the aspects of the property where memories were created. It’s hard pulling hearts away from recalling the moments; the paint colors, the perfect carpeting picked, a child’s first bedroom, or a dining room that held so many family dinners. The secret is to acknowledge that selling the home is going to be stressful and emotional upfront and hopefully that will enable good decisions going forward.

Once personal items like pictures, knick-knacks, etc. are removed to begin staging which it won’t feel as much like “home”. A good Realtor will give great recommendations to help make the home more neutral – maybe painting or pulling carpet – all of which will make the home seem more like a product that needs to sell and help to remove emotion.

It’s common for a seller to overprice their home when they are emotionally attached. The price of the home should be based on the market and the comparable properties, not the value the owner, someone with memories, puts on the home. An experienced Realtor will establish the price.

If a low offer should come in, it’s best to look at it as good news! Someone loves the home enough to even make an offer. The Realtor will negotiate and learn what the seller likes and dislikes keeping the owner out of that process while simultaneously keeping emotions out of the equation.

The Bottom Line: Make sure you are truly ready to sell your home. Make a list of the pros and cons of why you want to move and evaluate. Have an experienced Realtor help you once you have made the decision and realize that sentimental value does not translate to monetary value so you will need help pricing your home accordingly. Keep your emotions in check, make a clean break, and put your energy and time into making your new house the home of your dreams!

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How To Stage Your Home for Sale

A well-staged home can make people feel comfortable and at home, which is likely to increase the sale price.

Staging your home well allows buyers to see themselves in that space, which can help them become attached to it. This makes it harder to walk away without feeling a loss. The more attached to the space they feel, the more likely they are to make an offer.

Clean and Open Up the Space

Before showing off your space, take time to clean and declutter. This includes putting away unnecessary furniture, throw blankets and pillows. If you have too much stuff, put some of it in storage. Make the space minimal, and then add a few touches to make it feel like someone’s home. The space should look livable, but not lived-in.

Don’t Make It Too Personal

When inviting people into your home, it can be tempting to show off your style. This is your space, and chances are you have worked hard to make it comfortable and appealing to you and your friends and loved ones.

Remember, you want to appeal to as many buyers as possible. More interest from buyers means more bidding, and that usually means a higher sale price.

If you want to appeal to more potential buyers, it’s better to play it safe with décor. Consider putting away personal and unnecessary knick-knacks. Think clean lines and safe colors. If you decorate with books or art, try to keep the selections relatively neutral.

Consider Hiring a Professional

While staging on your own can keep costs down in the short term, hiring a professional may be worth the cost when the home sells. We tend to become attached to our spaces and design choices. An outside party who has worked with a wide variety of audiences as a professional will have an eye trained for mass appeal. Hiring a designer may even pay for itself if it increases the sale price.

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