All posts by Katie McCartney

Title Company – What Do They Do?

Title Companies are what I consider unsung players in this whole transaction. Title Companies are the ones that tie all the loose ends in place. They check the title work to make sure there is a clean title for the buyer (liens against the property, encroachments, etc.) so that everything will go through clearly.

Title Companies work with the buyer’s mortgage company to transfer the money from the loan to the seller’s mortgage company for their pay off. They provide a HUD or settlement statement to the buyer and the seller so everyone understands who pays for what services and fees.

Also, Title Companies are the places where the closings are handled. However if there is any reason that you cannot physically make the closing, they will send the documents early to sign.

Remember, if you just sign documents without the money being transferred from the buyer’s bank to the seller’s bank, this is called a signing and not a closing. Everything closes when the money is transferred, not any sooner and not any later.

Even though Title Companies are silent partners in this whole process, they tie everything neatly in a nice package and complete the deal.

Thanks Debbie King from Northwest Title Select for your input on this post!

What You Need to Understand about the Loan Commitment Process

 

As I stated in Laymans Understanding of The Residential Purchase Contract that I am NOT a Real Estate Lawyer, I am also going to state in this portion on t that I am NOT a Mortgage Loan Officer.  However, I know enough of a typical loan commitment process to give you the low down on what happens during this stage of the Purchase Contract. 

*There are several factors that will lead to Title work not being ordered:

  1. The buyer is not truthful about his/her financial situation.  Misleading information is given by the buyer, or all of the truthful facts needed by the lender are not provided.   This can cause the underwriter to reject the application. 
  2. The appraisal does not come in above, or at the purchase price.  If the appraisal comes in lower ($126k) than the purchase price ($128k) then the buyer must either ask for another appraisal or face the possibility of having to put down more money on the home.  Sellers this is a lesson to you too.  Price your home well so financing is obtainable.

A personal thank you to Natalie Moore from First Place Bank for reviewing this blog.  I really appreciate the consultation.

Importance of Home Inspections

Home Inspections provide the single most important and invaluable piece of information for the buyer.  For years, Home Inspections were not even considered as being a part of the contract.  That was when Purchase Contracts were geared more for sellers’ rights and the buyer had a more caveat emptor (buyer beware) approach to the sale of homes.  Due to the rise of buyer agents, this language has been tempered.  Now, you will find the Central Ohio Purchase Contract being  a little less one sided.

The largest change in the Central Ohio Purchase Contract came when Home Inspections were included within the text as a contingency that needed to be met before closing day.  This gives the buyer the right to have a third party, unbiased inspection done for their knowledge of the condition of the home.  Now, Central Ohio’s Purchase Contract allows for the buyer to request a remedy from the seller to fix the unsatisfactory conditions found on the premises.  However, a buyer cannot “…TERMINATE THIS AGREEMENT FOR COSMETIC OR NON-MATERIAL CONDITIONS…”  Basically, there needs to be a structural or health issue that the buyer feels that they are not willing to deal with in order to terminate the contract.  The remedy needs to address those conditions.  This is where you watch for the cues that the inspector gives you on what is IMPORTANT.

Interviewing Home Inspectors should be a top priority because you want to know their process and understand the length of time that they will be on the premises.  Also, you need to be aware of the cost.   Having an inspector who includes pictures with their report is an important benefit to consider.    Pictures  are worth a thousand words and are documented evidence of the conditions that your home inspector sees.  It is always good to be cautious about believing other peoples’ words.  Proof, documentation and facts will back up the words and provide the tangible evidence needed to make your case to the seller of the remediation that is needed for the home.

Remember, without a home inspection, you are buying at your own risk.  Only if you are confident in your handyman abilities, going to level the property, or have extremely deep pockets should you ever consider buying a non-inspected property.  This  is one consumer protection that you need to add to your budget when buying a home.