Just got this update from DW on the deed saga...
"I have good news and bad news on this file.
The good news.....the last seller received the deed, signed it, and returned it to Attorney X's Office. :-) This was the deed with all signatures including the one from China.
The bad news......the last seller is a notary and notarized her own signature! Ooops....can't do that. Attorney X's office has sent her a new deed (her signature only) with instructions to get it notarized. Hopefully she will do it right this time and get it back in a timely manner! The deed went out on Friday, 2/16.
I'll keep you posted!"
Wednesday, February 21, 2007
Thursday, February 15, 2007
still not closed.....
Just an update on a previous post, "The property has been in the family for decades."
One family member can't be found. They were circulating two deeds. The deed sent to this unresponsive family member is now lost along with all the signatures including one from China. The seller has agreed to allow us to escrow $10,000.00 while they pursue a quiet title on the unresponsive family member, but we can't close until they get the deed re-signed by everyone else.
The buyer is hanging in there. The seller has been buying rate lock extensions.
One family member can't be found. They were circulating two deeds. The deed sent to this unresponsive family member is now lost along with all the signatures including one from China. The seller has agreed to allow us to escrow $10,000.00 while they pursue a quiet title on the unresponsive family member, but we can't close until they get the deed re-signed by everyone else.
The buyer is hanging in there. The seller has been buying rate lock extensions.
Tuesday, February 13, 2007
HUD-1 Settlement Statement one day before closing?
Boy, we wish we could provide the final figures for review even 3 days before closing. That would be terrific. In fact, we have a bonus program here at TCS. If a member of our HUD Team produces a HUD two or more days before closing we pay a $10 bonus, split between the HUD preparer and our scheduler. We want to incent the "right" way to do business and assist buyers and borrowers who prefer time for review.
Hmmmmmm, you may be saying. How come we don't get our HUD-1 forms ahead of time on all transactions and aren't title agents required to provide it?
"Although real estate agents and consumers may believe that federal rules guarantee them the right to see the final closing numbers a day ahead of settlement, that's not completely accurate. Washington lawyer Phillip L. Schulman of Kirkpatrick & Lockhart Nicholson Graham LLP, an expert on federal real estate regulations, said in an interview that the law requires a closing agent to provide a borrower the HUD-1 figures one business day in advance only "if the borrower requests" such a review. Equally important, said Schulman, the closing agent is only required to "provide whatever figures [the agent] actually has received up until that time" from other parties involved in the transaction."
The article by Ken Harney, published in the Washington Post, offers a good explanation.
You see, as title agents, we don't control all of the data required to complete the final settlement statement. We do the best we can. In the end, we always have to play the hand we're dealt. Until we figure out how to bend time and alter reality, well, you catch my drift..... ;)
Hmmmmmm, you may be saying. How come we don't get our HUD-1 forms ahead of time on all transactions and aren't title agents required to provide it?
"Although real estate agents and consumers may believe that federal rules guarantee them the right to see the final closing numbers a day ahead of settlement, that's not completely accurate. Washington lawyer Phillip L. Schulman of Kirkpatrick & Lockhart Nicholson Graham LLP, an expert on federal real estate regulations, said in an interview that the law requires a closing agent to provide a borrower the HUD-1 figures one business day in advance only "if the borrower requests" such a review. Equally important, said Schulman, the closing agent is only required to "provide whatever figures [the agent] actually has received up until that time" from other parties involved in the transaction."
The article by Ken Harney, published in the Washington Post, offers a good explanation.
You see, as title agents, we don't control all of the data required to complete the final settlement statement. We do the best we can. In the end, we always have to play the hand we're dealt. Until we figure out how to bend time and alter reality, well, you catch my drift..... ;)
Thursday, February 08, 2007
Pre-approved and ready to go?
WHEN YOU FIND THE PERFECT HOUSE, a sales agreement will be prepared and an offer made to the seller. If you want the property inspected for any reason, this is the time to speak up. Do take the time to read the sales agreement. Most agreements are written in plain English so consumers will find them easy to understand. Make sure you understand the terms. If you are confused, ask your real estate agent or consult an attorney. (By the way, it's customary to deposit hand money as a good faith gesture. Be prepared to give your real estate agent a check.)
Monday, February 05, 2007
Refinancing Tips from a Closing Perspective
PREPARING FOR A REFINANCE
Refinancing is what you do when you put a mortgage on a piece of real estate you already own.
Mortgage lenders call it a refinance even if you own the real estate free and clear.
Understand the process and avoid common pitfalls. We've had lots of experience closing refinance transactions. We’d like to help you be an educated consumer.
1. ORDER A PAYOFF LETTER
If you have an existing mortgage, the very first step is to ask your mortgage lender for a payoff letter. All of the calculations you and your new lender figure will be based on how much you owe. Do NOT skip this step. There may be a small fee to get the letter, but it’s worth it.
Don’t just check your current principal balance, it’s not the same as a payoff. Why? Well, mortgage interest is paid in arrears. That means that your September payment actually paid the interest for August, so you are always one month behind in interest. When you payoff your mortgage, the lender will play catch up and add the remaining interest to bring you current. AVOID THE MOST COMMON REFINANCE PITFALL by getting a payoff letter up front.
2. THE HIDDEN AFFECT OF PROPERTY TAXES AND HOMEOWNERS INSURANCE
Timing and pre-planning a refinance will help you AVOID THE SECOND MOST COMMON REFINANCE PITFALL – getting caught in a cash crunch because your money is tied up in an escrow account at the time of closing.
If your existing mortgage lender has money set aside in an escrow account, look closely at the payoff letter to determine how they will handle these funds. Some mortgage lenders will give you an immediate credit for the escrow balance and this reduces the amount of the payoff. That’s great, but most lenders will simply mail you a refund check 2 to 3 weeks after the mortgage has been paid off.
If it looks like you’ll be getting a refund check, it is very likely that you will have to bridge the gap and come up with cash at closing to set up your new escrow account for the new mortgage lender. Here’s a tip – most mortgage loan officers don’t really understand this scenario, so YOU really need to plan ahead yourself.
Timing again is the key to AVOIDING THE THIRD MOST COMMON REFINANCE
PITFALL - a cash squeeze related to property taxes. If you are closing your refinance transaction at the same time the property taxes are due, you could get caught in a title guarantee “Catch 22”.
Here’s how it works. Let’s say the county property tax is due at discount on March 31st. You are planning to close on March 20th. The tax collector is reporting the tax as unpaid. Your existing mortgage lender has debited your escrow account to pay for the tax and may or may not have actually mailed the check to the tax collector. Since the tax has NOT been officially paid, the title agent has to collect the tax from you at closing to guarantee payment for your new mortgage lender. It’s a real “Catch 22” and the only way to avoid it is to plan the closing date around the payment of the tax.
Closing would need to either take place before your existing lender debits your account OR closing should be delayed until the tax payment has been posted by the tax collector. This is often easier said than done because you may be up against a rate lock expiration with your new mortgage lender and can’t delay closing.
The good news is that in either case, when you have to ante up cash at closing to cover tax or insurance related payments, you will always eventually be made whole. Refunds are processed as the payments are made and posted. If you have the cash available to ride through the refund process, that’s okay, but if you don’t, this information will help you to plan to avoid this kind of a last minute snag.
3. THINK ABOUT YOUR NEW MORTGAGE PAYMENTS AND WHEN THEY WILL START.
Refinancing often gives you a one or two month break from having to pay a mortgage payment. For instance, let’s say you are closing on February 5th and haven’t yet made a mortgage payment for February. Well, your existing mortgage will be paid off before the end of a typical 15 day grace period and it’s likely that your new mortgage payments won’t start until April 1st. Make a note to discuss this with your new lender and keep any possible cash flow benefit in mind just in case you need to come up with unexpected cash to close due to tax or insurance related payments.
4. WHAT IS THE PURPOSE OF THE REFINANCE?
Your new mortgage lender will want to know. Are you just reducing the rate/term or do you actually need to pull cash equity out of the property? Each mortgage loan program has specific guidelines relating to the length of time you have owned the property, how much cash you can pull out, etc. Be prepared to estimate the value of your property and discuss why you want to refinance. This will help your new mortgage lender find a program that’s right for you. An appraisal ordered by the new mortgage lender will ultimately set the current market value, but you have to consider possible options should the value come in lower or higher than expected, later on you and your lender can adjust the loan amount accordingly.
BOTTOM LINE – DO SOME HOMEWORK TO AVOID EXTRA STRESS, THEN REAP THE
BENEFITS OF REFINANCING.
Refinancing is what you do when you put a mortgage on a piece of real estate you already own.
Mortgage lenders call it a refinance even if you own the real estate free and clear.
Understand the process and avoid common pitfalls. We've had lots of experience closing refinance transactions. We’d like to help you be an educated consumer.
1. ORDER A PAYOFF LETTER
If you have an existing mortgage, the very first step is to ask your mortgage lender for a payoff letter. All of the calculations you and your new lender figure will be based on how much you owe. Do NOT skip this step. There may be a small fee to get the letter, but it’s worth it.
Don’t just check your current principal balance, it’s not the same as a payoff. Why? Well, mortgage interest is paid in arrears. That means that your September payment actually paid the interest for August, so you are always one month behind in interest. When you payoff your mortgage, the lender will play catch up and add the remaining interest to bring you current. AVOID THE MOST COMMON REFINANCE PITFALL by getting a payoff letter up front.
2. THE HIDDEN AFFECT OF PROPERTY TAXES AND HOMEOWNERS INSURANCE
Timing and pre-planning a refinance will help you AVOID THE SECOND MOST COMMON REFINANCE PITFALL – getting caught in a cash crunch because your money is tied up in an escrow account at the time of closing.
If your existing mortgage lender has money set aside in an escrow account, look closely at the payoff letter to determine how they will handle these funds. Some mortgage lenders will give you an immediate credit for the escrow balance and this reduces the amount of the payoff. That’s great, but most lenders will simply mail you a refund check 2 to 3 weeks after the mortgage has been paid off.
If it looks like you’ll be getting a refund check, it is very likely that you will have to bridge the gap and come up with cash at closing to set up your new escrow account for the new mortgage lender. Here’s a tip – most mortgage loan officers don’t really understand this scenario, so YOU really need to plan ahead yourself.
Timing again is the key to AVOIDING THE THIRD MOST COMMON REFINANCE
PITFALL - a cash squeeze related to property taxes. If you are closing your refinance transaction at the same time the property taxes are due, you could get caught in a title guarantee “Catch 22”.
Here’s how it works. Let’s say the county property tax is due at discount on March 31st. You are planning to close on March 20th. The tax collector is reporting the tax as unpaid. Your existing mortgage lender has debited your escrow account to pay for the tax and may or may not have actually mailed the check to the tax collector. Since the tax has NOT been officially paid, the title agent has to collect the tax from you at closing to guarantee payment for your new mortgage lender. It’s a real “Catch 22” and the only way to avoid it is to plan the closing date around the payment of the tax.
Closing would need to either take place before your existing lender debits your account OR closing should be delayed until the tax payment has been posted by the tax collector. This is often easier said than done because you may be up against a rate lock expiration with your new mortgage lender and can’t delay closing.
The good news is that in either case, when you have to ante up cash at closing to cover tax or insurance related payments, you will always eventually be made whole. Refunds are processed as the payments are made and posted. If you have the cash available to ride through the refund process, that’s okay, but if you don’t, this information will help you to plan to avoid this kind of a last minute snag.
3. THINK ABOUT YOUR NEW MORTGAGE PAYMENTS AND WHEN THEY WILL START.
Refinancing often gives you a one or two month break from having to pay a mortgage payment. For instance, let’s say you are closing on February 5th and haven’t yet made a mortgage payment for February. Well, your existing mortgage will be paid off before the end of a typical 15 day grace period and it’s likely that your new mortgage payments won’t start until April 1st. Make a note to discuss this with your new lender and keep any possible cash flow benefit in mind just in case you need to come up with unexpected cash to close due to tax or insurance related payments.
4. WHAT IS THE PURPOSE OF THE REFINANCE?
Your new mortgage lender will want to know. Are you just reducing the rate/term or do you actually need to pull cash equity out of the property? Each mortgage loan program has specific guidelines relating to the length of time you have owned the property, how much cash you can pull out, etc. Be prepared to estimate the value of your property and discuss why you want to refinance. This will help your new mortgage lender find a program that’s right for you. An appraisal ordered by the new mortgage lender will ultimately set the current market value, but you have to consider possible options should the value come in lower or higher than expected, later on you and your lender can adjust the loan amount accordingly.
BOTTOM LINE – DO SOME HOMEWORK TO AVOID EXTRA STRESS, THEN REAP THE
BENEFITS OF REFINANCING.
Thursday, February 01, 2007
COMPARE INTEREST RATES AND "GOOD FAITH ESTIMATES"
There's more to shopping for the best deal than just comparing interest rates. Each lender provides a "Good Faith Estimate" disclosing costs associated with the transaction. Ask for this disclosure before choosing your lender. You need it to make a fair comparison.
The costs disclosed on the "Good Faith Estimate" are basically divided into 3 categories:
Actual lender fees - controlled by the lender - Use this section to carefully compare lender charges.
Fees for required services - Estimated fees for services being performed by third parties. The lender does not control these fees; so consider the quote merely an estimate. (The Closing Specialists® fees fall into this category. Call or e-mail us directly for fee quote plus use our PA Title Rate calculator.)
Interim interest, escrows for taxes and insurance, and proration of taxes. Commonly referred to as "prepaid items," this section of the "Good Faith Estimate" should not be relied upon when comparing costs.
Here's how these figures are determined:
Interim interest - The maximum interest you could be charged at closing is 31 days. The loan officer can make the estimate look high or low by adjusting the number of days quoted. The true amount you will pay at closing is determined by the actual date of closing. If you prepare for 31 days, you're working with a good conservative number.
Escrows for taxes and insurance - If your lender is going to escrow for taxes and/or insurance, the loan officer will give you a rough idea of what to expect. The estimate can be made to look high or low based on the number of months the loan officer uses. Do not rely on these figures when comparing costs. Basically all lenders who escrow will use roughly the same figures at closing. All lenders adjust the final numbers based upon actual tax bills and the date of closing. We suggest you always use at least 10 or 12 months of escrows to keep your expectations conservative.
Proration of taxes - At closing, there will be an adjustment between seller and buyer for taxes already paid or due later in the year. Lenders typically do not include prorations in the "Good Faith Estimate".
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