HELPFUL INFORMATION

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HOW DOES A PURCHASE WORK ? (FOR BUYERS)

In a typical purchase, we can prepare the closing contract, or review a contract prepared by your realtor.  An attorney is available to explain the contract to you, as well as the closing process.  Once the contract is signed, we may act as escrow agent.  If you are shopping for a mortgage lender, we can help you to understand and compare good faith estimate(s) provided by the lenders. If we are acting as your closing agent, we will commence lien and title searches, and work closely with your mortgage lender in providing a title insurance commitment and other information needed for a mortgage loan.  We can order your survey and provide you with resources, if requested, for obtaining a home inspection and homeowners (hazard/flood) insurance.  Our goal is to assist you throughout the transaction with any questions or issues that may arise.  We can prepare your documents for closing, schedule the closing date at a convenient time and location, and assist you in understanding the documents you sign at closing.  If we are acting as your closing agent, we will record the deed, mortgage, if applicable, and other closing instruments and issue your Owners Title Insurance Policy. Our prices are reasonable and competitive with other closing and title agents.

HOW DOES A SALE WORK? (FOR SELLERS)

In a typical sale, we can prepare the closing contract, or review a contract prepared by your realtor. An attorney is available to explain the terms of the contract to you, as well as explain the entire closing process. Once the contract is signed, our office can act as escrow agent. We can provide you with legal guidance and representation throughout the closing process.  There may be issues related to  inspection, or questions regarding the status of  title to the property, such as unsatisfied mortgages, errors in your chain of title that have gone undetected, until now. Our goal is to provide answers and do our best to assist in resolving problems. We can prepare your closing documents, or review the documents prepared by the Buyer's title or closing agent. Sometimes, there can be hidden items in closing documents which you are not required, nor should you sign, which is why you should have an attorney representing your interest. If you are located in Palm Beach County, or north of Palm Beach County, you may be responsible to provide an Owners Title Insurance Policy to the Buyer. In those instances we can act as closing and title agent and prepare and issue the title commitment and policy. Our prices are reasonable and competitive with other title and closing agents.

WHAT IS TITLE INSURANCE?

Title Insurance is an insurance policy which protects you against loss related to title defects. If a claim is made, your title insurance underwriter, in accordance with the terms of the policy, will undertake to cure the defect, at its expense. If it cannot cure the defect, you are reimbursed for your actual loss up to the face amount of the title policy. The face amount of the policy is, typically, the amount in which you paid at purchase. The cost is a one time premium that is paid at closing. The title insurance coverage is effective for as long as you own the property. Our underwriter is Old Republic National Title Insurance Company.

WHAT IS A TITLE SEARCH?

To issue title insurance, your closing/title agent must perform a title search . A title search is a detailed examination of the historical records of a property. It involves an examination of deeds, mortgages, judgments, recorded liens, unpaid taxes , and other encumbrances that can effect your title. Matters such as divorces, bankruptcies, death of prior owners, homestead rights, deed restrictions, can also effect title. If the title search uncovers a title problem, it must be resolved prior to closing, in order for a title insurance policy to be issued without exception for defects.

WHAT ARE CLOSING COSTS?

Closing costs are the expenses required for the completion of a real estate transaction. If you are purchasing or selling real property, usually the contract for purchase and sale will state the expenses that will be attributed to Buyer or Seller. Closing cost can include the owners title insurance policy, closing fee, title search, survey fees, and mortgage loan costs. There are also prorations of costs such as taxes and homeowners association fees, as may be applicable. We are glad to provide an estimate of closing costs. If you are obtaining a mortgage loan, your lender will provide you with a Good Faith Estimate of closing costs. We can review the Good Faith Estimate with you. We provide closing and title services at competitive rates.

HOW DOES A REFINANCE WORK?

When you are refinancing a mortgage on your property, your lender will require you to purchase a lenders title insurance policy. You may also select the title insurance/closing agent. We typically perform the title search, issue the title insurance policy, prepare closing documents, settlement statement, and act as the Closing Agent. We will do our best to provide closing and title services at competitive rates. Your lender will provide you with a Good Faith Estimate of closing costs. We can review this estimate with you. We are interested in protecting your interests.  We are available to answer questions and explain documents so that you understand what you are signing.  We are also familiar with the local requirements for document preparation, title and recordation of instruments. We believe that the closing process is often easier for you when you are using a local title and closing agent familiar with local procedure; this is particularly true if you are using an out of state mortgage lender. In this circumstance you should consider using our closing and title services rather than the lender's out of state closing servicer whom may not be as familiar with local custom and practice.

SHORT SALES:

We are experienced in Short Sale transactions.  A Short Sale is a type of purchase and sale transaction where the purchase price is less than the amount of mortgage debt owed by a Seller to his or her mortgage lender(s), Short sales are more complicated and time consuming than an average real estate sale, making it important to retain an experienced real estate attorney to oversee the transaction.

The Seller's lender must approve the contract and acceptance of an amount less than the mortgage amount in order to release the lien on the property.  The short sale lenders may take 90 to 120 days,  to respond to a request for short sale acceptance. The short sale lender will request an application to be completed, as well as personal financial information from the Seller.  Our office can guide the Seller though the short sale process and act as a negotiator, if requested. Often a Seller's realtor may take an active role in the short sale negotiation process. Fees associated with this service are transaction specific, so please call us to discuss.

Typical Documentation Request by Lender for a Short Sale

Authorization to Release Information
This is a letter that permits the Lender and its agents to communicate with our law office and the realtor.

A Preliminary HUD-1 Settlement Statement
An estimated closing statement that shows the sale price, and amount to be paid to short sale lender after deduction of closing costs, real estate commissions and other expenses of closing.

Hardship Letter
A letter explaining the personal and financial circumstances that lead to your difficult financial situation, and a request to the lender to accept less than full payment.

Statement of Assets
Lenders will want a truthful and accurate statement of assets (such as savings accounts, money market accounts, stocks or bonds, negotiable instruments, cash, real estate or anything of tangible value.)  The short sale lender is more willing to negotiate if you have little or no ability to pay the mortgage debt, than if you have other assets or some ability to pay. In circumstances of where you may have other assets, the lender may still accept a short sale, but may want you to contribute money, sign a promissory note, or use the other assets to pay all or some portion of the remaining debt after short sale.

Proof of Income
Lenders may require:

• Two months of the most recent bank statements
• Last two most recent pay stubs 
• Current W-2 
• Last two years of  Tax Returns 
• Most recent 401K statement (if applicable) 
• If self-employed, a Personal Financial Statement showing income each month and expenses paid, (such as food, child care, auto payments, electric, mortgage payments, insurance, etc.)

Comparables/Comparative Market Analysis
If your property value has declined in value and this is part of the reason that you are selling your home, your real estate agent can prepare a Comparative Market Analysis, which will show prices of similar homes that are actively on the market, or have sales pending, or have recently closed. This will substantiate your claim as to the decline in property value.

Purchase Agreement and Listing Agreement
The Lender will require a copy of the signed offer contract, and a copy of your listing agreement with your realtor.

Buyer's Pre-approval Letter or proof of funds
If they Buyer is obtaining financing in order to purchase your property, the short sale lender may want a copy of the Buyer's prequalification letter from his or her lender. If the Buyer intends to pay cash, the lender may ask Buyer for proof of sufficient funds to complete the purchase, such as bank statements.

Consult with Certified Public Accountant
You should consult with an Certified Public Accountant regarding your short sale to determine if the amount forgiven by your short sale lender, if any, may have tax consequences.

Helpful Hints
Make sure that the loan number is written on each and every document submitted to the Lender.
Remember to explain any unusual activity in your account bank statement, or deposits, that the Lender should consider as a continuing source of income.