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Century 21 serving the Metroplex
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Vikki York 817-996-9091 |
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Figuring
your closing cost is sometimes confusing. I can give you a figure that is real close. Buyers should talk to there lender because
some fee’s may vary. Always get a good faith estimate from your lender. Links to print closing cost |
Christi D Bahr Escrow Officer Fidelity National Title 2800 S Hulen Street, Suite 115 Fort Worth, Texas 76109 817.546.4900 817.698.9401 fax |
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When
figuring your closing cost you should click on the link above and print the forms you need. Sellers need to print Title Insurance
and Selers closing cost. Buyers will see Title Insurance but will only need the Buyers closing cost scroll down and print. 1)
Buyers-Most of the time the Survey (some sellers have a Survey) and Appraisal or paid up front to the lender .Termite inspection
are paid up front to your Inspector. These are figures you can back out of the price. These are called closing cost. To figure
your pre-paid amount you need to add 1-Years insurance and 4-months of taxes. A Buyers closing cost consists of closing cost
and pre-paid amount. Print the Buyers closing cost sheet only. This is a way to get an idea of your cost. Always check
with your lender to get a good faith estimate. If you need to get a loan and you want the seller to pay your closing
cost and pre-paid be sure to let me and your lender know so we can adjust the offer. 2) Sellers -To get your closing
cost you will need to add Owners Title Policy, Real Estate Commission ,Tax Prorating From Jan 1st till day of closing.
You will need to print Sellers closing cost and Title Insurance forms so you will know the amount on the Title Policy. If
you have any questions contact your Lender, Title Company or me |
Here is
a list of things that you may or may not know about! There are a few things that can be done in times of |
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Questions and Answers on Real Estate Closings In
the typical residential real estate transaction, a buyer offers to purchase property from a seller. After negotiating the
price and terms, the buyer and seller sign an offer to purchase and contract, and the buyer gives the seller (or the seller’s
agent) an earnest money deposit to show good faith in the transaction. A real estate “closing” is the final step
in the transaction. At closing, the buyer pays the purchase price to the seller (usually with the proceeds from a loan), and
the seller gives the buyer a deed transferring title to the property to the buyer. Also, funds are paid to other service providers,
and to pay off banks or others who may have claims against the property. This document focuses on questions frequently
asked about residential real estate closings. The questions raised are of special concern to real estate purchasers. Consequently,
they are posed from the standpoint of the purchaser. Q: Does a “loan commitment letter” guarantee
that I have a loan to buy the property? A: No. The standard form Offer to Purchase and Contract requires you
to use your best efforts to obtain a loan before a specified date. If the seller requests it, you must give the seller a copy
of your loan commitment letter . A loan commitment letter does not guarantee that the lender will make the loan. It simply
means that, based upon an initial review, your credit appears sufficient to qualify you for the necessary loan amount. After
issuing the letter, the lender may refuse to approve your loan if there are any changes in your employment, creditworthiness,
or other changes which might affect your ability to repay the loan. The lender reserves this right until the deed is recorded
transferring title and the loan proceeds are actually disbursed at closing. Q: What kind of inspections do I
really need to have to find out about the condition of the property? A: A number of inspections are highly
recommended. They should be provided for in the purchase contract, even if they are not required by the lender. Remember,
the standard Offer to Purchase and Contract states that “closing shall constitute acceptance of the property in its
then existing condition unless provision is otherwise made in writing.” In other words, once closing is completed, you
may be found to have accepted the property in its existing condition. The most important inspections are: •
Home Inspection A home inspector typically examines the condition of the property, including the plumbing,
heating, cooling, and electrical systems, and the structural components. Professional home inspectors must be licensed. Read
the home inspection report carefully, and be sure to ask the seller to complete all repairs permitted in the purchase contract.
Not having a home inspection may save you money “up front”, but it could be very costly if you find after closing
there is a major defect in the property. You may also need additional inspections performed by a specialist, such as an electrician,
heating and air conditioning contractor, or a structural engineer. • Wood-Destroying Insect Inspection Have
a licensed pest control operator perform a pest inspection prior to closing. It should reveal evidence of wood-destroying
insects, if any, that could adversely affect the structure. • Survey A survey provides accurate
measurements of the property; its precise total area; the location of buildings and other improvements to the property; and
any encroachments, easements and possible setback violations. You are typically responsible for paying for the survey. Examine
the survey prior to closing to make sure the acreage and other conditions of the property match what you were told by the
seller or real estate agents and what is shown in the purchase contract. You should also be aware that the title insurance
company may exclude from coverage problems shown on the survey which are not resolved before closing. •
Appraisal Virtually all lenders will require you to pay for an appraisal of the property to determine if its
market value meets or exceeds the purchase price. Review the appraisal report prior to closing to make sure the value of the
property, its square footage and features match what you were told by the seller or real estate agents and what is shown in
the purchase contract. • Wells and Sewage Disposal Systems If you are buying a property
served by either a well or a septic system (not city water or sewer), you should have them inspected prior to closing. A well
inspection and separate water test should be done to determine whether there is an adequate amount of water and water pressure
for the property and if there are any harmful contaminants in the water. An examination of the septic system should determine
if it is adequate to support the property and is properly performing. Repairs to these systems can be very expensive. Q:
What is title insurance? A: The Title Company will require you the (seller/buyer) to purchase title
insurance to protect its interests from potential title problems. Before issuing a title insurance policy, the title company
will require the closing attorney to perform a title search to discover any problems with the title to the property. Problems
found during the title search (such as unpaid judgments, taxes, mortgages, etc. on the property) must be corrected before
closing. For a few dollars more you can also purchase your own title insurance policy to cover you from title problems with
the property which may not have been discovered prior to closing. If a problem covered by your policy is discovered after
closing, the title insurance company will help clear up the problem or compensate you for any losses you have sustained. Like
any insurance policy, there may be exceptions in your coverage, so it is critical that you carefully read your policy and
refer any questions to the closing attorney. Q: What if the seller wants to give me a nonwarranty, or quitclaim
deed? A: The deed transfers the seller’s interest in the property to you. There are many different types
of deeds. The best one — the general warranty deed — contains the seller’s warranty that good title is being
conveyed to you. A quitclaim (or non-warranty) deed contains no warranties at all; therefore, you accept title from the seller
“as is.” A special warranty deed contains limited warranties from the seller. If you are given anything other
than a full or general warranty deed, immediately consult with your attorney. Q: What is a “homeowner’s
association”? A: If you buy in a residential subdivision or planned community, it is likely you will
be joining a homeowner’s association. A homeowner’s association is a group of property owners that acts like a
private local government, providing services or benefits to its members such as a clubhouse, pool or trails. Members pay for
these benefits in accordance with the association’s bylaws. Homeowner’s associations may also regulate the use
of common areas, paint colors, fences, outbuildings, etc. By exercising their voting rights, members have input into decision-making.
If you are purchasing property in a subdivision or planned community, prior to closing you should obtain documentation as
to any dues, assessments, covenants, rules, restrictions, and services provided. If the real estate agent(s) or closing attorneys
do not give you relevant documentation prior to closing, ask them for the most current copy and review it before you close. Q:
What happens if the property is damaged or destroyed after I sign the purchase contract but before closing? A:
Typically, the purchase contract requires that the property be in substantially the same or better condition at closing as
on the date you contracted to buy it (normal wear and tear excepted). If the property is damaged or destroyed by fire or other
casualty prior to closing, the risk of loss is on the seller. The buyer has the option to wait for the seller to repair or
reconstruct the property or to terminate the contract and recover any earnest money deposit. Q: Who closes the
transaction? A: A real estate closing is completed when the seller conveys the title to you by deed, you give
the purchase money to the seller, and the appropriate documents are recorded with the Register of Deeds office in the county
where the property is located. The closing will probably be handled by a Title Company/Attorney chosen by the seller.
In many transactions, the attorney may also represent the lender and the seller. The seller may hire his or her own attorney
or pay your attorney to prepare the deed to give to you. Make sure you know “up front” who the attorney is representing.
Prior to closing, the seller should give the closing attorney a copy of the deed to the property. Also, if there is an outstanding
mortgage on the property, the seller should give the attorney any personal information needed to obtain a loan payoff figure
so any existing loan(s) can be paid off in full at closing. As the buyer, you will need to give the closing attorney a copy
of your contract and contact information about your lender . Since closing involves several complex phases (examination of
the title, completion and explanation of legal documents, and resolution of any possible title problems). Also, read each
closing document so you fully understand each step of your real estate transaction. If a non-attorney is handling your closing,
that person may render only administrative services related to the transaction — not give you legal advice. Q:
What is a closing statement or “HUD-1”? A: A closing statement is a document that summarizes all
funds received by you and the seller at closing, and all funds paid by you and the seller for various expenses of the
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transaction
(real estate agent commissions, loan payoffs, fees for inspections, property taxes, etc.). For all closings involving federally
insured loans, the Real Estate Settlement Procedures Act (RESPA) requires that this information be reported on a form from
the federal Department of Housing and Urban Development (HUD) — a HUD-1 form. Typically, you must pay a portion
of the property taxes, the cost of all inspections, and all costs associated with the loan. These costs include the appraisal
fee, survey, pest inspection, lender fees, fees to establish an escrow balance for homeowner’s insurance, taxes and
any required private mortgage insurance, attorney fees, and recording fees. The seller normally pays the balance due on any
existing loans, his portion of the taxes, commissions to real estate agents,title insurance (policy) fees for deed preparation,
cancellation of existing liens. In most transactions, payment of these fees is negotiable between the parties. However, if
you are getting a VA or FHA loan, the lender may require the seller to pay particular closing costs, such as the pest inspection. Q:
I am being asked to put something on the HUD-1 that is different than what I agreed to. Is that ok? A: Probably
not. The HUD-1 should reflect the agreement between the parties and match the terms set out in the purchase contract. You
may be committing loan fraud if you make a false representation to a lender on the HUD-1, the loan application, or elsewhere
in order to obtain a larger loan amount or a loan on more favorable terms than you are otherwise qualified for under the lender’s
guidelines. Loan fraud is a federal crime punishable by up to 30 years in prison and $1 million in fines. If you are asked
to do any of the following, refuse and immediately contact the Texas Real Estate Commission: Create
a false gift letter for down payment funds. Make it appear you made a deposit when, in fact, you did not. Give
the seller a secret or even false or “forgivable” second mortgage. Make payments outside of closing which
are not disclosed on the HUD-1, such as additional fees paid to service providers, to the seller, or third parties. Make
a false statement that you will occupy the property. Give false personal information about yourself to the lender.
Q: What is “prorating”? A: Certain items (real estate taxes, occasionally
special Assessments, etc.) are prorated at closing. “Prorating” occurs when you and the seller are each responsible
for a portion of an expense. For example, property taxes are assessed as of January 1 but not normally payable until the end
of the year. The seller is responsible for his share of the property taxes from January 1 through the closing date. You will
be responsible for the remainder of the year. Review the contract carefully to be sure you know what items, if any, will be
prorated at closing. Q: If I’m a seller, when should I get my proceeds from the sale of my property? A:
The closing attorney may disburse funds immediately after closing has been completed, the title has been updated, and the
documents have been recorded. Often, time may not permit the closing attorney to record the documents, update title, and disburse
funds, or the lender may not be able to wire the loan proceeds, all in the same day. When this happens, a “dry closing”
is sometimes held with the funds being disbursed the next business day. If you are a seller, you should discuss the timing
of disbursements with the closing attorney in advance so you can be aware of any possible delays. If you are a buyer, be aware
that the seller may not be willing to give you possession of the property until he receives his proceeds from the sale. Q:
What if I can’t close by the time stated on the contract? A: If your purchase contract states that “time
is of the essence” as to the closing date and you fail to close on that date (regardless of the reason), you will probably
be considered in breach of the contract. Consequently, if your lender fails to provide the closing package in time for closing,
you may unintentionally lose your chance to purchase the property. Likewise, if the seller cannot complete a major required
repair prior to the stated closing date, the seller may lose the sale. |