Home Buyers Resources

The best thing about hiring a real-estate agent to help you buy a home is that it prevents you falling prey to the most common and most avoidable mistakes. Just as you would hire a lawyer to navigate the esoteric world of the legal system, it can be disastrous to try to take on the real estate world unassisted. REALTORS® are specialists who understand every nuance of the market; they know how to avoid the problems that commonly plague home-buyers.

Our Evergreen Home Team is ideal not only because we are respected REALTORS® with a reputation for integrity, but because we love and understand the world of Evergreen real estate. We're committed to finding the best Evergreen homes for sale, in order to associate ourselves and our clients with the best properties available.

Buying a home is probably the most important investment you'll make. Don't leave it to chance. Review our The Buying Process - 10 Steps to Buying a Home and then contact your Home Team for a better understanding of homes for sale in Evergreen, Colorado.

We've included some companion material with the 10-step guide. The Real Estate Contracts page links to copies of some of the important contracts you'll have to deal with in the home buying process. The Contract Dates Guide lists excerpts from all of the contracts, providing a rough checklist that you can use as a relative timeline of contract dates, so you'll be sure that you've completed all of the legal steps in time.

 

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10 Steps to Buying a Home

For most people, the process of buying a home is complex and intimidating. We've drafted an outline of the process, including what steps you need to be anticipating, complete with more involved advice.

1. Define Your Needs
2. Mortgage Pre-approval Pre-Qualify
3. Neighborhood Information
4. Search Listings
5. Making an Offer
6. Negotiate The Offer
7. Finding Vendors
8. Pre-Close Preparation
9. Closing on a Home
10. After Closing

1. Define Your Needs
Congratulations on your decision to purchase a new home! Your first step toward buying your new home will be to analyze your needs. Your real estate agent can assist in analyzing your needs so that you will be able to get a clear picture of exactly what you want your new home to look like and how it should function for you and your family.

First, you should write down why you are looking for a new home. For example, are you currently renting and would like to have a home where you can begin building equity? Maybe you recently married and have outgrown your current residence. Or, maybe you have just gotten a promotion, which requires you to move to a new city. These factors will all have a bearing on how you approach your home search.
Second, establish a time frame that you would like to stay within for buying your home. Depending on your reasons for wanting a new home and the current state of the market in the area you are looking to buy, you should be able to come up with a rough guideline, which you can finalize at a later time.

Last, you most likely have a mental picture of what you would like your house to look like and what features it should have. It's very important to write these ideas down to avoid any ambiguity later in your home search. You should make at least two lists: one should be a list describing your dream home and the other should list the features of the home that are an absolute must-have in order to buy it. In a perfect world, your new home would fulfill both lists 100 percent. It is more likely that you will end up blending the two lists into a schedule of prioritized items as you progress through the buying process. This is a natural and evolutionary process as you get more clear about what you want and what is available.

2. Mortgage Pre-approval / Pre-Qualify
Now that you have your list of features you want in your new home, you are ready to start looking! Well, not just yet. You are going to need to know in what price range to look. There are two ways to go about this. You can get pre-qualified or pre-approved for a Mortgage .

Either way, you will need to contact a Mortgage company. There are some key differences between prequalification and preapproval for a loan that you need to be aware of. Loan prequalification is a simple process. It takes into account very basic information regarding your financial status and gives you an amount for which you may qualify. This can be done strictly on a verbal level or electronically over the Internet. The pre-qualified amount is based solely on the information you provide. In most markets, pre-qualified buyers usually hold little clout compared to pre-approved buyers due to the fact that the information given during the prequalification process is not thoroughly investigated and therefore may be unreliable. Where a pre-approved buyer is actually approved for a loan of a certain amount, a pre-qualified buyer is only told that they might be approved for a certain amount.

Pre-approval is a much more involved process. The lender will take all pertinent information regarding your finances and perform an extensive check on your current financial status. This will ultimately give you the exact amount that you will be eligible for (depending on what type of loan you decide to go with). Being pre-approved lets the seller know that you have gone through an extensive financial background check and there should be no unexpected obstacles to buying the home. You can see how being pre-approved would be more attractive to a seller than just being pre-qualified.
In order to make an offer to buy a home, you must submit a personal check for about 1% of list price ($2,000 for a home selling for $200,000). This money will need to be in a checking account so it doesn't delay the process of making an offer.

3. Neighborhood Information
Now that you have your list of needs and wants and you know how much you can afford to spend, it's time to look at some houses! Not just yet. Step back for a moment and consider the larger picture. People don't just buy a house; they buy the neighborhood the house is in. Think about that...if you found the perfect house but it was in a neighborhood that wasn't to your liking, would you make an offer on it? Most likely the answer would be, "No."

So, you will need to make another list: What type of neighborhood do you want to live in? You will most likely want to consider things like how living in the neighborhood will affect your drive time to and from work, what amenities are offered (swimming pool, tennis courts, park, etc.), and, if you have children who are attending school or soon will be, what school district you will be in and how close the schools are. You may even want to make two lists, just as you did with your home criteria.

Your real estate agent can help you consolidate the information from your list of needs and wants for your home, your pre-approval, and your list of needs and wants for the neighborhood. You can incorporate this information into a broad search profile, which will then be narrowed down to specific areas dictated by the market you will be looking in. Your agent's experience in local markets will be an invaluable resource during this step.

4. Search Listings
At this point you will have a good idea of what you can afford and the type of area you will want to invest in. Taking that information into consideration, you are ready to embark on your property search. If you don't know much about the city you're moving to, you will most likely want to start your search by finding areas that meet your criteria and then narrowing your search to particular properties in the area.

There are a few ways to go about this. Possibly the most efficient way to find properties is to allow your real estate agent to keep you up-to-date on available properties that meet your criteria, and then allow your agent to screen these properties for you. When your agent presents you with a property that interests you, he or she can arrange for you to tour the property at your convenience.

You can also access local publications highlighting available real estate in the area; contact and visit the local Chamber of Commerce; look on the Internet; and even drive through areas that you feel would meet your needs. Driving around a particular area looking for properties for sale is good because you can actually see the property. However, it can be very time-consuming and it is a "hit or miss" process.

5. Making an Offer
Now that you and your real estate agent have found the home you would like to purchase, it's time to make an offer. Taking into account the recent sales of homes in that neighborhood which are similar in size, quality, conveniences, and amenities, what are you willing to pay for the home? Your real estate agent will consult with you and advise you on how to create an offer that will have the best chance of being accepted.

Your agent will ensure that you have everything down in written form... no verbal agreements. After consulting with you to put your offer in a written contract that meets all the legal requirements according to local and national guidelines, your agent will present the seller with a written document detailing what needs to be done by both parties to execute the transaction. The contract should protect the best interests of all parties involved and should be comprehensive. Your agent will also ensure your financial position as the buyer by including any necessary contingencies, which would protect you if a particular requirement was not met. Once the seller accepts it, it may be too late to make any changes.

The contract, though not limited to this list, should include the following:

• A legal description of the property
• The offering price
• The down payment
• Financing arrangements
• A list of fees and who will pay them
• Amount of the deposit
• Inspection rights and possible repair allowances
• The method of conveying the title and who will handle the closing
• A list of appliances and furnishings that will stay with the home
• The settlement date
• Any relevant contingencies

Remember that the legalities of this phase are very important. If you have any questions or concerns, they need to be addressed right away. After all, no one has ever said at their closing, "I wish I had asked fewer questions."

6. Negotiate The Offer
Once your offer is made, you and your real estate agent may need to enter some negotiation in order to reach an agreement. Keep in mind that almost everything is negotiable when you are buying a house. This can give you a great deal of leverage in the buying process -- that is, if you have adequate information and you use it in an appropriate manner. Your agent will have the market knowledge and negotiating expertise necessary to make sure that your offer is accepted at the best price and terms possible for you.

Some of the things that you may have to negotiate are:

• The price
• Financing
• Closing costs
• Repairs that need to be done
• Appliances and fixtures
• Landscaping
• Painting
• Occupancy time frame

The key to successful negotiating is keeping in mind that the end result must make both you, the buyer, and the seller happy. Otherwise, negative feelings will persist throughout the remainder of the process and someone may walk away feeling that they were not treated fairly.

7. Finding Vendors
After your offer has been accepted, your agent will supervise the coordination of all necessary vendors and serve as your advocate when working with each vendor. Your agent will make sure that the vendors have access to the property at the appropriate times to perform their procedures and oversee the execution of those procedures on your behalf.

For instance, the property will need a thorough examination. Working with your lender, you may need to have a formal appraisal and a survey done for the property designated in the contract. A property inspection, a foundation inspection, and an environmental inspection may also need to be completed to make sure that the property is up to the standards set forth in your written agreement. If there are issues or inconsistencies brought to light during this time, it may delay or even nullify the contract depending on the contingencies set forth in the contract.

Homeowner insurance is another very important item that will need to be taken care of at this point. Insurance experts recommend that you obtain insurance equal to the full replacement value of the home. Unless you have insurance coverage on the home, the closing can not proceed. Having these procedures done in a timely and professional manner is a must. Investigate each vendor to make sure that they are reputable and have a clean operational history.

Your agent's experience in this area will be invaluable in making sure that everything is completed on time and in a professional and legal manner.

8. Pre-Close Preparation
As the closing date draws near, your real estate agent will contact the escrow company or closing attorney and your lender to make sure that all the necessary documents are being prepared, and that they are complete, accurate, and delivered in a timely manner. Your agent will also need to confirm that the documents will be delivered to the correct location so they can be reviewed and that they will be ready for the appropriate closing date.

At this point, you and your agent should find out what form of payment you will need to bring to the closing for any unpaid fees. Make sure that your payment is made out to the appropriate party.

Ensuring that each closing document is ready and available will enable you to have a quick, easy closing.

9. Closing on a Home
"Closing" refers to the meeting where ownership of the property is legally transferred to the buyer. It is a formal meeting that is attended by most parties involved in the buying/selling process. Closing procedures are usually held at the title company's office or lawyer's office. Your closing officer coordinates the document signing and the collection and disbursement of funds. Your agent will be present at your closing to read the documents on your behalf, answer any questions, or help to resolve any last minute or unexpected details that may come up.

In order for the closing to go smoothly, each party involved should bring the necessary documentation and be prepared to pay any related fees (closing costs). There may be more than one form of acceptable payment for your closing costs, so ask the closing officer which form of payment will be required and to whom it should be made out. Closing costs will generally total an amount equal to 2 to 3 percent of the total loan value, not including down payment and the buyer's escrow account.
Sellers sometimes pay for a portion or all of the closing costs, depending on local market conditions, terms of the purchase contract, and the seller's cash and timing considerations. Any such concessions should be acknowledged in writing. Most lenders will allow a credit from the seller to the buyer for the non-recurring closing costs. However, they usually won't allow a credit that reduces the amount of the buyer's down payment or any of the buyer's recurring costs, such as expenses for fire insurance premiums, PMI, or property taxes.

10. After Closing
Congratulations on the purchase of your new home! Now that you have taken ownership of the property you will need to have your local services such as electricity, cable, and phone set up. Your real estate agent can help you coordinate the set-up of these local services. No doubt your agent already knows who the local vendors are for such services as water and electricity, as well as others, so he or she can help provide you with a list of contacts.
Also, you should already be aware of the expenses that are typically associated with owning a home. Neighborhood Association fees, landscaping costs, and annual taxes should be budgeted for throughout the year.

 

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Top 10 Mistakes

If you want to buy a home, now is the perfect time to prepare. The purchase of a home or townhouse is not just the acquisition of your own home, but probably your best investment ever. For most people, their home purchase is their largest lifetime investment, yet many home buyers make costly mistakes. Here is a list of the most common errors and how to avoid them:

Home buyer mistake # 1:   Never buying the first home. 
Many first-time buyers purchase a home because it is such an improvement over a renting situation yet many others never take the leap. Take all the time you need to view homes and make a sound home buying decision, but don't be afraid to commit to a new home purchase.  Cold feet are natural, but don't miss out on your dream home.

Home buyer mistake # 2: Choosing the wrong agent.
Don't make buying a home more difficult by choosing the wrong agent. You want a buyer's agent who works for you and understands your needs and financial limitations. Your agent should spend time with you and walk you through the process so it's important to choose someone who is both competent and enjoyable to work with.

Home buyer mistake # 3: Shopping for homes before shopping for a mortgage.
Buyers who look at homes before talking with a lender are shopping without a budget. When you talk to a mortgage broker you'll get a better idea of the loan options and the price ranges you can afford. After completing the pre-approval process, you will be a more educated consumer ready to buy a home. Asking for referrals to a few prospective mortgage companies can be a good way to find someone you can trust. Interview prospective loan officers and ask questions until you feel comfortable.

Home buyer mistake # 4: Skipping the inspection process.
Failure to have the property professionally inspected for structural, mechanical, safety, and environmental defects can lead to buying the wrong home. Inspections turn buyers into informed consumers. Knowing as much as possible about your home purchase will allow you to make an informed decision, so don't skip the inspection process.

Home buyer mistake # 5: Buying a home that won't sell.
Many first time buyers sell their home in just a few years.  Carefully consider all the negatives.  Get a neutral opinion from a friend or relative who is familiar with the area. There are many things to consider for resale and your agent is another good source for this type of information.

Home buyer mistake # 6: Buying the wrong size home.
View your home purchase in the long term.  Consider lifestyle changes and family dynamics when choosing your home.  Are a home based business or do you have kids in your future plans? There are costs associated with buying and selling a home and these costs quickly eat away at any equity so be sure to plan accordingly and buy the right size home.

Home buyer mistake # 7: Choosing a lender just because they have the lowest rate.
While the rate is important, consider the total cost of your loan including the APR, loan fees, discount and origination points. When receiving a quote from a lender or broker, insist that the discount points (charged by the lender to reduce the interest rate) be distinguished from origination points (charged for services rendered in originating the loan).

The cost of the mortgage, however, shouldn't be your only criterion. Be sure to do your homework so you can have confidence that the company you select is reputable and will deliver the loan with the terms and costs they promise. If, in the final hours of the transaction, you determine that the lender has suddenly increased their profit margin at your expense, you won't have time to start again with a different lender.

Also, sit down with your mortgage broker to get all the specifics on the mortgage you are considering.  There are many alternatives to the 30-year loan.  Choose the one which best suits your needs.

Home buyer mistake # 8: Buying a home with an incurable defect.
Whether you are considering a new build or an older home, no residence is perfect. Fortunately, most homes don't have incurable defects. These obvious problems include a bad floor plan, poor location (such as near a noisy freeway or adjacent to the city dump), heavy street traffic and lack of adequate parking. In most cases, these issues cannot be resolved by the buyer and will still be an issue when the home is sold at a later date. Be sure to avoid these types of defects or at least consider them when determining the price you'll pay for a home.

Home buyer mistake # 9: Buying the most expensive home on the block.
It's wonderful when you find your dream home, but if it's the most expensive home on the block you could have a problem. Quite simply, your neighbors' lower home values will dampen yours. Remember, people who buy a $500,000 home usually want to be surrounded by other $500,000 homes, not tiny $100,000 bungalows.

Home buyer mistake # 10: Not allowing for delays in the transaction.
In a perfect world, all real estate transactions close on time. In the world we live in, transactions are often delayed a week or more. Suppose you asked your landlord to terminate your lease the day your purchase transaction was scheduled to close. A day or two before your scheduled closing date, you discover your transaction is delayed a week. In a perfect world, no one is inconvenienced and your landlord is willing to work with you. More likely, however, your landlord is inconvenienced and angry. Will you be thrown out? Will you have to find interim housing for a week or more?

The eviction process takes a little time, so the Sheriff won't immediately remove you, but this type of stress-producing episode can be avoided. How? Terminate your lease one week after your real estate transaction is scheduled to close. That way, if there is a delay in closing your transaction, you have some leeway. This approach might cost a little more, then again, it might not.

This type of delay can present many problems, but planning for delays can alleviate the stress that these problems have on you and your life.

 

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Understanding Your Credit

Anyone who takes an interest in buying a home will need to consider the state of their credit. Whether or not you have good credit determines what kind of loan you will receive, or even whether you can get a loan at all. But how does one know about the state of their credit, and how is it calculated?

Your credit score is mathematically determined by a number of factors in your credit history. These include such things as how you pay your bills and what kind of debts you owe. Click here for more information about how credit scores work.

Even if your credit score is too low to allow you to get the kind of loan you're after, don't despair. It's possible to repair your credit through patience and an ongoing effort. For tips on how this is done, click here.

By order of a Congressional mandate in December of 2003, consumers are entitled to a free credit report from each of the three major credit agencies, once a year. And if you've expired your annual right, you can pay a fee to view the report. The three major agencies are: Equifax, Experian, and TransUnion.

Remember, if you are unsure about how your credit will relate to your real estate experience, The Reel Team would be happy to assist you. They have a professional understanding of credit scores as they relate to buying a home, and they can help you make the most of your situation.

 

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Real Estate Contracts

Buying or selling real estate can be very complicated and intimidating for someone who is unaccustomed to the process. In anticipation of the steps you'll need to take in order to buy or sell your home, we've included links to samples of contracts, agreements, and disclosures, so you can develop a familiarity with some of the vocabulary and factors involved. Take a few minutes to read the ones that apply to you.

Buyers and Sellers

Contract to Buy & Sell Real Estate (Residential) - This is the main agreement between the buyer and the seller for the purchase of a property.

Definitions of Working Relationships - This document describes the 3 different legal relationships between a Real Estate Agent and an individual buying or selling property.

Buyers Only

Brokerage Disclosure to Buyer - This is a form the buyer and broker sign to acknowledge receipt of the different types of Real Estate relationships. This is not a contract - signing just acknowledges receipt of the document.

Exclusive Right-to-Buy - This is the contract between the real estate agent and the buyer. The contract explains the duties and responsibilities of each party and is notice that the buyer intends to use only one real estate agent for the term of the contract.

Sellers Only

Exclusive Right-to-Sell - This is the contract between the real estate agent and the seller. The contract explains the duties and responsibilities of each party.

Seller's Property Disclosure (Residential) - This document is a disclosure form used to convey the condition of the house from seller to buyer.

 

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Contract Dates Guide

This article lists the dates and responsibilities involved in the buying and selling of a home. It includes information about when each event should reasonably be completed, so you can use it as a checklist to make sure you haven't missed an important legal step.

Acceptance Deadline Date & Time

Responsible Party: Seller

Date Range : Usually 1-3 days after offer submission

Contract Section: 27

Contract Language: “This proposal shall expire unless accepted in writing, by Buyer and Seller, as evidenced by their signatures below, and the offering party receives notice of acceptance pursuant to § 26 on or before Acceptance Deadline Date (§ 2c) and Acceptance Deadline Time (§ 2c). If accepted, this document shall become a contract between Seller and Buyer. A copy of this document may be executed by each party, separately, and when each party has executed a copy thereof, such copies taken together shall be deemed to be a full and complete contract between the parties.”

Explanation: The date & time in which an offer expires unless accepted in writing by the seller.

Sellers Property Disclosure Deadline

Responsible Party: Seller

Date Range: 1-2 Days After Acceptance

Contract Section: 10

Contract Language: “On or before Seller's Property Disclosure Deadline (§ 2c), Seller agrees to provide Buyer with a Seller's Property Disclosure form completed by Seller to the best of Seller's current actual knowledge.”

Explanation: The seller of a property has until this deadline to complete their property disclosure. This disclosure outlines the details about the condition of the home and any problems known by the seller.

Loan Application Deadline

Responsible Party: Buyer
Date Range : 2-4 Days after contract acceptance
Contract Section: 5a

Contract Language: “If Buyer is to pay all or part of the Purchase Price by obtaining a new loan, or if an existing loan is not to be released at Closing, Buyer, if required by such lender, shall make a verifiable application by Loan Application Deadline (§ 2c).”

Explanation : The buyer must apply for a loan by this date. I always recommend seeing a lender before the buying process begins so this date should be met before an offer is made.

Title Deadline

Responsible Party: Seller/Title Company
Date Range : 7-10 Days after acceptance
Contract Section: 7a

Contract Language: “On or before Title Deadline (§ 2c), Seller shall cause to be furnished to Buyer, at Seller's expense, a current commitment for owner's title insurance policy (Title Commitment) in an amount equal to the Purchase Price”

Explanation: Any information relating to the title of the property being sold must be obtained by this date.

Inspection & Cost Estimates

Responsible Party: Buyer
Date Range : 3-6 Days after acceptance
Contract Section: N/A

Contract Language: Not listed in contract. This date is implied by the Inspection Objection Deadline.

Explanation: The home inspection is not required but is highly recommended. This allows the buyer to evaluate the home for any problems. If any problems exist and the buyer is still interested in the home, cost estimates should be received to better evaluate the need for further negotiation.

• Home Inspection
• Plumbing Inspection
• Electrical Inspection
• Improvement Location Certificate

Document Request Deadline

Responsible Party: Seller
Date Range : 1-2 Days After Title Deadline
Contract Section: 7b

Contract Language: “(1) a copy of any plats, declarations, covenants, conditions and restrictions burdening the Property, and (2) if a title insurance commitment is required to be furnished. Seller shall have the obligation to furnish these documents pursuant to this subsection if requested by Buyer any time on or before Document Request Deadline (§ 2c). This requirement shall pertain only to documents as shown of record in the offices of the clerk and recorder. The abstract or title insurance commitment, together with any copies or summaries of such documents furnished pursuant to this section, constitute the title documents (Title Documents).”

Explanation: Based on the contents of the title documents, the buyer may request additional documents. This request must be made by this date and can only pertain to documents on record with the county clerk and recorders office.

Off-Record Matters Deadline

Responsible Party: Seller
Date Range : Same as Title Deadline
Contract Section: 8b

Contract Language: “Matters not Shown by the Public Records. Seller shall deliver to Buyer, on or before Off-Record Matters Deadline (§ 2c) true copies of all leases and surveys in Seller's possession pertaining to the Property and shall disclose to Buyer all easements, liens (including, without limitation, governmental improvements approved, but not yet installed) or other title matters (including, without limitation, rights of first refusal, and options) not shown by the public records of which Seller has actual knowledge. Buyer shall have the right to inspect the Property to determine if any third party has any right in the Property not shown by the public records (such as an unrecorded easement, unrecorded lease, or boundary line discrepancy).”

Explanation: Any documents or issues known by the seller but not in the public record must be disclosed by this date. An example of this would be any type of oral agreement between neighbors or friends to allow the use of land or property. If the agreements is not legally recorded it must be disclosed by the seller to the buyer by this date.

Property Insurance Objection Deadline

Responsible Party: Buyer
Date Range : 2-5 Days after acceptance
Contract Section: 10c

Contract Language: “This contract is conditioned upon Buyer's satisfaction, in Buyer's subjective discretion, with the availability, terms, conditions and premium for property insurance. This contract shall terminate upon Seller's receipt, on or before Property Insurance Objection Deadline (§ 2c) of Buyer's written notice that such insurance was not satisfactory to Buyer. If said notice is not timely received, Buyer shall have waived any right to terminate under this provision.”

Explanation: Before this date, the buyer should verify that their insurance company will insure the property as well as the buyers if they own the property. Certain circumstances my exist that would prevent an insurance company from covering a property and it is best to learn these issues right away.

Inspection Objection Deadline

Responsible Party : Buyer
Date Range : 7-10 Days after acceptance
Contract Section: 10a

Contract Language: “Buyer shall have the right to have inspections of the physical condition of the Property and Inclusions, at Buyer's expense. If the physical condition of the Property or Inclusions is unsatisfactory in Buyer's subjective discretion, Buyer shall, on or before Inspection Objection Deadline (§ 2c):

(1) notify Seller in writing that this contract is terminated, or
(2) provide Seller with a written description of any unsatisfactory physical condition which Buyer requires Seller to correct (Notice to Correct).

If written notice is not received by Seller on or before Inspection Objection Deadline (§ 2c), the physical condition of the Property and Inclusions shall be deemed to be satisfactory to Buyer.”

Explanation: If buyer chooses to have an inspection done on the property, the buyer must object to any unacceptable findings of the inspection on or before this date. An inspection may reveal issues with the property that are unsatisfactory to the buyer. These issues must be listed along with a proposed action for the seller to remedy. This is a negotiation and both parties will need to agree on a resolution by the Resolution deadline listed below or the contract will terminate.

Survey Deadline

Responsible Party: Buyer/Seller
Date Range : 5-7 Days Prior to closing
Contract Section: 7c

Contract Language: “On or before Survey Deadline (§ 2c) Seller or Buyer shall cause Buyer and the issuer of the Title Commitment or the provider of the opinion of title if an abstract, to receive a current Improvement Survey Plat or Improvement Location Certificate.”

Explanation: If an improvement location certificate or survey is required the cost will be split as stated in the contract and the seller agrees to provide the results to the buyer by this date.

Governing Documents & Title Objection Deadline

Responsible Party: Buyer
Date Range : 2-4 Days after Title Deadline
Contract Section: 7d

Contract Language: “Seller shall cause to be furnished to Buyer, at Seller's expense, on or before Title Deadline (§ 2c) a current copy of the owners' association declarations, bylaws, rules and regulations, party wall agreements, minutes of most recent annual owners' meeting and minutes of any directors' meetings during the 6 month period immediately preceding the Title Deadline, if any, most recent financial documents consisting of (a) annual balance sheet, (b) annual income and expenditures statement, and (c) annual budget, if any.”

Explanation: This date covers 2 different activities:

First, the Governing Documents deadline is the last date the Seller shall furnish to Buyer, at Seller's expense, a current copy of the owner's association declarations, bylaws, rules and regulations, party wall agreements and most recent financial documents, if any. If the buyer finds problems or concerns with the information in these documents, written notice of the unsatisfactory provision(s) must be presented to Seller on or before this date.

The second is the Title Objection Deadline. Buyer shall have the right to inspect the Title Documents. Written notice by Buyer of any unsatisfactory title condition shown by the Title Documents shall be signed by Buyer and given to Seller on or before this date. (Reference contract section 8-a)

Off-Record Matters Objection Deadline

Responsible Party: Buyer
Date Range : Same as Title Objection Deadline
Contract Section: 8d

Contract Language: “In the event the Property is located within a special taxing district and Buyer desires to terminate this contract as a result, if written notice is received by Seller on or before Off-Record Matters Objection Deadline (§ 2c), this contract shall then terminate. If Seller does not receive Buyer's notice by such date, Buyer accepts the effect of the Property's inclusion in such special taxing district and waives the right to terminate.”

Explanation : Written notice of any unsatisfactory condition(s) disclosed by Seller or revealed by Off-Record Matters Deadline shall be signed by Buyer and given to Seller on or before this date. If Seller does not receive Buyer's notice by this date, Buyer accepts title subject to such rights, if any, of third parties of which Buyer has actual knowledge. (Reference Contract section 8-b)

Resolution Deadline

Responsible Party: Buyer/Seller
Date Range : 2-3 Days after Inspection Objection Deadline
Contract Section: 10b

Contract Language: “If a Notice to Correct is received by Seller and if Buyer and Seller have not agreed in writing to a settlement thereof on or before Resolution Deadline (§ 2c), this contract shall terminate one calendar day following the Resolution Deadline (§ 2c), unless before such termination Seller receives Buyer's written withdrawal of the Notice to Correct.”

Explanation: See above: Inspection Objection Deadline. All inspection issues must be resolved by this date. The buyer may decide to back out of the contract or the buyer and seller may agree to have items fixed, lower the sales price or any combination of the two.

Survey Objection Deadline

Responsible Party: Buyer
Date Range : 5-7 Days Prior to closing
Contract Section: 8c

Contract Language: “Buyer shall have the right to inspect Survey. If written notice by or on behalf of Buyer of any unsatisfactory condition shown by Survey, notwithstanding § 8b or § 12, is received by Seller on or before Survey Objection Deadline (§ 2c) then such objection shall be deemed an unsatisfactory title condition. If Seller does not receive Buyer's notice by Survey Objection Deadline (§ 2c), Buyer accepts Survey as satisfactory.”

Explanation: If the buyer has any objections or issues with the property survey, the objection must be received by the seller on or before this date.

Appraisal Deadline

Responsible Party: Buyer/Lender
Date Range: 5-7 Days Prior to closing
Contract Section: 6a4

Contract Language: “Buyer shall have the sole option and election to terminate this contract if the Purchase Price exceeds the Property's valuation determined by an appraiser engaged by Buyer. The contract shall terminate by Buyer giving Seller written notice of termination and either a copy of such appraisal or written notice from lender that confirms the Property's valuation is less than the Purchase Price, received on or before Appraisal Deadline (§ 2c). If Seller does not receive such written notice of termination on or before Appraisal Deadline (§ 2c), Buyer waives any right to terminate under this subsection.”

Explanation: If box 6-a-4 is checked, Buyer shall have the option to terminate this contract if the Purchase Price exceeds the Property's valuation determined by an appraiser. Termination of this contract must be received in writing by the Appraisal Deadline.

Loan Commitment Deadline

Responsible Party: Buyer
Date Range : 3-5 days before closing
Contract Section: 5b

Contract Language: “If Buyer is to pay all or part of the Purchase Price by obtaining a new loan as specified in § 4b, this contract is conditional upon Buyer obtaining a written loan commitment. This condition shall be deemed waived unless Seller receives from Buyer, no later than Loan Commitment Deadline (§ 2c), written notice of Buyer's inability to obtain such loan commitment.”

Explanation: This is the date for final loan approval. This date is close to the closing date so the buyer can make every effort to obtain the proper financing.

Closing Date

Responsible Party: Buyer/Seller
Date Range : 30-45 days after acceptance
Contract Section: 11

Contract Language: “Delivery of deed from Seller to Buyer shall be at closing (Closing). Closing shall be on the date specified as Closing Date (§ 2c) or by mutual agreement at an earlier date.”

Explanation: Closing is the end result of the other dates up to this point. The deed is transferred and loan papers are signed. After closing, the transaction is complete and the buyer can take possession at the below date and time.

Possession Date & Time

Responsible Party: Buyer/Seller
Date Range >: Same day as closing, when possible
Contract Section: 16

Contract Language: “Possession of the Property shall be delivered to Buyer on Possession Date and Possession Time (§ 2c)”

Explanation: The date & time when the buyer may begin to take possession of the property.

 

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Mortgage Guide

 

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School Guide

 

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Title Insurance

When you purchase a home you'll be required to purchase and maintain many types of insurance. Title insurance is probably the least understood of these. So what is title insurance and why do you need it? We'll try to provide you with answers here.

When you purchase a home you're actually paying for title to the land; this means you acquire the right to occupy and use the space. Part of the price paid will be for the improvement, or the actual home, but the major cost of most property is the land itself. The title may be restricted by rights and claims of others; this could in turn limit your use and enjoyment of the property and even bring financial loss. Title insurance insures against these situations.

While other forms of insurance protect against future problems, title insurance protects against things which have already happened. Other forms of insurance also charge annual premiums while they insure. Due to the nature of protecting against problems from the past, on the other hand, title insurance is a one time premium.

A central aspect of title insurance is the elimination of risk prior to issuance of coverage. A claim or loss is a losing situation for all parties and every attempt is made to eliminate this possibility early on. The process of researching the history of a title begins with the public records. An agent for the title company investigates the title chain to determine if any “material objections” exist. These issues are normally the results of documents which did not transfer the title clearly. Examples of these documents would be:

• Deeds, wills and trusts that contain improper wording or incorrect names;
• Outstanding mortgages and judgments, or a lien against the property because the seller has not paid his taxes;
• Easements that allow construction of a road or utility line;
• Pending legal action against the property that could affect a purchaser; or
• Incorrect notary acknowledgements.

These matters are identified and corrected early in the process whenever possible. Despite all of the hard work and research that goes into a title search, there are undetectable problems which can surface later and cause financial hardship or even loss of the property. Some problems which are often undetectable include:

• A forged signature on the deed, which would mean no transfer of ownership;
• An unknown heir of a previous owner claiming ownership of the property;
• Instruments executed under an expired or a fabricated power of attorney; or
• Mistakes in the public records.

It's these types of situations where title insurance becomes the most valuable. The insurer has certified that the title is transferable and is responsible for defending against claims as they arise. This could involve perfecting the title or paying out for valid claims. These are often complicated and expensive legal proceedings; placing the onus of responsibility on the insurer will allow you to avoid the costs and stress involved.

If your home is important to you, don't overlook this important piece of insurance. If you have more questions, consult with an attorney or industry professional until you understand your rights and obligations.

Contact us today to learn more about title insurance or any other real estate matters!

 

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