Sunrise Homes & Renovations, Inc.

Do You Need a Real Estate Attorney to Help Close Your Home Purchase? Let’s Take a Look

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Do You Need a Real Estate Attorney to Help Close Your Home Purchase? Let's Take a LookWhen buying a new home, you may have a close eye focused on your budget and expenses, and your goal may be to keep related expenses to a minimum. However, you may also be well aware that a real estate purchase is a legal transaction, and you may be wondering if you need to pay for legal services from a real estate attorney. With a closer look, you can make a better decision that is right for your home buying plans.

The Legal Forms Used With A Typical Transaction

The majority of real estate contracts will be written using standard legal forms. These are legally binding forms with clauses that protect buyers and sellers alike. While they are standard forms, you do want to read the forms in their entirety and understand your obligations before signing the contract. Keep in mind that you are not required to use these forms, and you can request an attorney to prepare a separate contract for you. However, these are commonly used forms that real estate agents typically will use.

The Services Of A Real Estate Agent

A real estate agent is not a legal professional, and your agent likely will not be licensed to practice law in the state. However, the agent can explain your obligations with a standard contract so that you have a better understanding about what you are committed to. Your real estate agent may refer you to a real estate attorney if you require a special contract to be drawn up or if you are not comfortable with different clauses in the standard forms.

When Special Situations Arise

The standard real estate contracts will typically be feasible for use with most transactions, but there are special situations that may arise from time to time. For example, you may only want to purchase a portion of a large estate. While the seller would need to subdivided, your attorney would need to review special documents to ensure the transaction is legal. Perhaps you want to purchase real estate in a corporation or under another entity, or you want to protect your rights when purchasing property with a partner who you are not legally married to.

While real estate agents are not legal professionals, they are able to prepare standard contract forms for you and explain them to you. Because of this, many people will not need to pay for additional legal services, but each situation is unique. When you speak with your trusted mortgage professional about your upcoming purchase, he or she can help you to learn more about services an attorney may provide that your real estate agent may not be able to.

Buying a Home? What to Do if Problems Are Found During the Final Home Inspection

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Buying a Home? What to Do if Problems Are Found During the Final Home InspectionAs a home buyer, you may go through a number of different steps to ensure that the property that you purchase is in great condition. For example, you may complete an initial walk-through or even several home tours before you make an offer. You may also order a property inspection and even negotiate for the seller to make some repairs on your behalf.

A day or two before your closing date, you may set up a final home inspection to ensure that the home is still in the same condition as the initial walk-through. In most cases, there will be no problems with the final inspection. However, in the event that there is a problem with the final inspection, you will need to know how to handle it.

Work With Your Real Estate Agent

As a first step, you should discuss the issues with your real estate agent. Your real estate agent may have some strategies or ideas that can be used to help you overcome the issue in the best possible way. Minor issues may be resolved with a last minute negotiation to the sales contract. More significant issues may need to be rectified prior to closing, and you may need to delay the closing by a few days or longer until any issues are resolved.

Consider Walking Away

It may be rare for a property to have issues during the final home inspection, and most issues that do arise at this late stage in the buying process may be resolved through negotiations between the buyer and seller. However, in the event that the seller plays hardball and refuses to work with you to resolve the matter, or in the event that the issue is so significant that you are not comfortable with it, it may be an option to walk away from the property.

In most sales contracts, wording is present that requires the property to be delivered to the buyer in the same condition as it was when the contract was signed less general wear and tear. Walking away may not be ideal, but it may be the best option in some cases.

Making a final home inspection is not a requirement, but it is advisable. It can ensure that the home your purchase is in the same condition as it was when you did the initial walk-through, and you can apply these tips if you discover that the home is not in the same condition.

Home Buying Horror Stories: How Buying a Home Can Go Wrong – and How to Avoid These Mistakes

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Home Buying Horror Stories: How Buying a Home Can Go Wrong - and How to Avoid These MistakesWhen you buy a home, you may have dreams of settling into a beautiful new space that meets your needs and that your family can feel comfortable in. While many will enjoy this vision of domestic tranquility after taking ownership of their dream home, others have had their dream turn into a veritable nightmare due to some simple mistakes or oversights on their part. By understanding these mistakes, you can avoid making them yourself.

Paying Too Much For The Property

One the surface, the main cost of buying a home relates to the sales price, and it is true that your monthly housing payment may be the primary related expense. However, other expenses such as homeowners insurance, property taxes, repair and maintenance costs, utilities and more will all need to be factored into the cost of home ownership. Some buyers believe that because an online calculator or a lending professional tells them that they can afford a high priced home that it is the case. You can review your budget and estimate all related home expenses to determine how affordable a specific property is for you.

Finding Out That The Location Is Undesirable

There are many things that can make a location undesirable, and you should take time to become comfortable with the location before making an offer. Consider, for example, if the neighbors like to throw loud parties on the weekend or if there is a teen driver that likes to speed down the street. If you are buying a property with open land or vacant buildings around it, consider researching zoning, and think about future uses for these properties that could influence value and desire.

Discovering That Your Property Is In Bad Condition

Some home buyers discover after purchasing a property that it is not in the best condition, and some even learn that their home needs tens of thousands of dollars of repair work or more. Even properties that appear to be in great condition on the surface may have hidden issues with the foundation, structure, roof, pipes or electrical work, to name a few. You can order a property inspection to learn more about the true condition of a property.

These are among the most common issues that can turn a dream home into a nightmare. When you work with a local real estate agent when buying a home, your agent can help you to avoid unpleasant and costly mistakes such as these.

The Three Essential Habits That Successful Home Buyers Must Embrace

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The Three Essential Habits That Successful Home Buyers Must EmbraceWhether you are preparing to purchase your first home or it has been many years since you last walked through the home buying process, you may be starting to feel overwhelmed at the thought of all of the work that lies in front of you. From concerns about finding the right home to the physical act of relocating all of your belongings after the closing, there is certainly a lot to think about. While each home buying transaction is unique, the most successful home buyers have typically adopted a few behaviors. You may keep these in mind to help you navigate through the process with success.

Keep An Eye On Your Budget

Financial stress when buying a home is common. You may have saved for years to afford your down payment, but there are various expenses that some may have not calculated or planned for. It is important to leave extra funds available for unexpected expenses, such as paying for the appraisal up-front on the home you have fallen in love with. Likewise, keep a close eye on your budget so that you are aware of your financial situation at all times.

Be Available And Flexible

It is imperative that you remain available and flexible as much as possible. Your real estate agent may call you at the last minute with a great new listing that has come on the market, and you may need to be flexible with your schedule to see this property before other buyers do. In addition, you may need to be flexible and accommodating with regards to contract negotiations, working with title company requests and more.

Seek Advice And Knowledge

Buying a home does not have to be stressful, but it also is not something that you do every day. There is a lot for even an experienced home buyer to learn, and you should be prepared to seek advice and to educate yourself along the way. Ask questions as necessary, and use the Internet for additional research.

Home buying is a process, and you may consider taking one day at a time as you proceed through the journey to reach your ultimate goal. A skilled real estate agent can guide you through the process and can help you to more successfully reach your goal. Reach out to a real estate agent today to begin looking for your new home.

Do You Need Mortgage Insurance Even If It’s Not Required By Your Lender? Let’s Take A Look

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Do You Need Mortgage Insurance Even if It's Not Required by Your Lender? Let's Take a LookFinding a proper mortgage loan and understanding the processing procedures behind the loan is the basis of good research. The down payment on a mortgage loan is typically significant when dealing with mortgage insurance.

Most loan applications with less than 20% down payment are required to include mortgage insurance with the loan. However, mortgage insurance may still be required even if it’s not typically required by your lender.

Underwriting Requirements

Most home mortgage applications undergo a strict set of standards for approval. These standards are known as underwriting and make up the bulk of time spent on a mortgage application. Unique situations in employment or credit history may require an additional down payment percentage to avoid PMI or private mortgage insurance.

Most underwriting requirements require adequate information on the borrower’s credit and employment history for complete application. Self-employed individuals or those with alternative forms of credit may need a few additional hoops to jump through when dealing with mortgage insurance requirements.

Lender-paid Mortgage Insurance

Lender-paid mortgage insurance is a popular option with potential homeowners that seek to avoid the cost of a PMI or FHA-backed insurance on a home loan. Most lenders incorporate payment of private mortgage insurance in exchange for a slightly higher interest rate.

This is one example of the points system on a mortgage application that eliminates the cost of PMI. The increase in interest rate may or may not warrant the need for a lender-paid mortgage insurance arrangement.

What’s Involved With Risk Assessment?

Strict lending requirements and banking policy now limit the number of mortgages with zero down payment options. Conventional mortgages and FHA both require private mortgage insurance if it is less than 20% down payment. However, FHA loans can be more flexible with the initial down payment requirements with adequate credit. FHA mortgage costs are now for the life of the loan. Lenders will look at mortgage insurance as risk protection.

The risk protection process may or may not require mortgage insurance in your home loan. For example, VA and USDA loans do not usually require mortgage insurance if the borrower’s credit and employment history are adequate.

Conventional loans have a reduction in risk once there is at least 20% equity in the home compared to the principal of the mortgage. Don’t hesitate to contact your trusted mortgage professional about potentially dropping mortgage insurance in the future to reduce overall loan costs.

Making The Offer: 4 Ways To Craft An Offer That Will Catch The Seller’s Attention

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Making the Offer: 4 Ways to Craft an Offer That Will Catch the Seller's AttentionIt can take a time and effort to find the perfect home to purchase. After you have found that home, you need to convince the seller that your offer is the one they want to choose. There may be multiple offers made at the same time, and you may be in a situation where you are competing for the home.

Even if your offer is the only one the seller receives, there is no requirement that they must accept the offer you make. Crafting an effective offer that will catch the seller’s attention is important, and you may be able to accomplish this by following a few tips.

Offer Close To The Asking Price

One of the first things most sellers will look at when they receive an offer is the price you are offering to pay. You may feel as though the seller is asking too much for the home, and your agent may advise you to offer a lower price. On the other hand, there may be multiple offers, and you may feel as though you need to offer a price higher than what is being requested. With your real estate agent’s advice in mind, consider that a seller will be more inclined to accept an offer if it is close to what they are asking. If your offer is too low, they may decline it without looking at the other merits to your offer.

Request A Quick Closing

When you prepare your offer, one of the factors that you will have control over is the requested closing date. Sellers generally want to close quickly, but this is not always the case. Each market is unique, but a general rule of thumb is to offer a closing date that is 21 to 28 days away, contingent on mortgage approval. You may work with your real estate agent and mortgage company to determine when a reasonable closing date is. However, offering a quick closing generally shows that you are a motivated buyer.

Choose A Shorter Option Period

A sales contract has an option period, which allows the buyer to back out of the deal for any reason. This may be a time when you get your third party reports, such as the property inspection, completed. A shorter option period may be preferred by sellers. This is because the buyer is generally locked into the contract contingent on mortgage approval after the option period has expired.

Offer A Higher Non-Refundable Good Faith Amount

When you make an offer, you will also give the seller a good faith or earnest money deposit. The amount of the deposit will be disclosed in the contract, and you will typically hand it off after the offer has been accepted. This is the amount of money that you stand to lose if you do not follow through on the terms of the contract. A higher good faith or earnest money amount shows that you are serious about buying the home.

There are many factors that a seller is thinking about when reviewing an offer. While the entire offer will be reviewed fully, the fact is that these factors are generally given significant weight in most seller decisions. You can work with your real estate agent to structure the best offer possible.