For Buyers
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Title Insurance >> How to Buy a Resale Home >> 10 Reasons to Buy a New Home
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Title Insurance
When you purchase a home, the purchase price includes title to the land and any improvements to the land (i.e., the physical structures). Title to the land on which your home is located can be encumbered or restricted by rights that could affect your use and enjoyment of the property. For example, the neighboring home may have built a fence that crosses onto your land or third parties may hold an easement (a right to use your land for a specific purpose) across your land. Title insurance provides a buyer with protection against encumbrances and restrictions that will affect the buyer’s use and enjoyment of the land on which the home is located.
While other forms of insurance protect against future problems, title insurance protects against problems that have already occurred. To obtain title insurance the buyer will pay a one time premium at the time the insured property is purchased. Generally, a title insurance policy will insure the property (with certain exceptions, as discussed below) as long as the buyer owns the property. There are, however, certain events which could cause a lapse of coverage in the title insurance (i.e., transferring the property to a family member, a legal entity, or certain types of trusts). You should consult with an attorney before you transfer the insured property.
When you desire to purchase title insurance for your property, the title company that you choose will conduct a search of public records to determine if there are any restrictions or encumbrances related to the insured property. Some examples of restrictions and encumbrances that the title company will look for include:
- Deeds, wills and trusts that contain improper wording or incorrect names;
- Outstanding mortgages, judgments, or liens against the property;
- Easements that allow construction of a road or utility line;
- Mineral rights held by third parties;
- Pending legal action against the property; or
- Incorrect notary acknowledgements.
Based on the public records search, the title insurance company will provide you with a Title Insurance Commitment that will outline the proposed insurance coverage for the property. It is very important to note that the Title Insurance Commitment will often include certain “restrictions” or items that will not be insured by the title company. We recommend obtaining the assistance of a qualified attorney to review your Title Insurance Commitment and advise you of any items related to the property that will not be insured by the title company.
At the time the property is purchased, the title insurance company will issue a Title Insurance Policy that will reflect the terms and conditions of the insurance coverage. Again, it is important to note that a title insurance policy will not cover every problem related to the property.
After you purchase your home, there are many issues that could arise that the title company could not determine through the public records search. Some problems which are often undetectable include:
- A forged signature on a deed;
- 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.
Depending on the terms and conditions of your title insurance policy, the cost to remedy these problems could be the responsibility of the title insurance company. However, the cost to remedy some of these problems may be excluded from your coverage and the cost to cure the remedy will be the responsibility of the owner. Having a qualified attorney review your Title Insurance Commitment could prevent or make you aware of these exclusions from your title insurance policy.
We are not licensed attorneys and this description of title insurance is not intended to provide any legal advice. If you have any further questions, please give us a call and we can try to answer your questions or recommend a qualified attorney.
How to Buy a Resale Home
Choosing A Good Real Estate Agent
You will want a real estate agent who is a professional, aggressive and top sales agent in their office. The large well funded real estate companies have high standards for business practices, ethics and customer satisfaction. Our professional team qualifies for all of these important criteria.
Be Sure To Get Your Credit Score Before You Shop For a House
Most lenders consider people with a score of over 650 to be prime borrowers, meaning they will most likely be approved at favorable rates.
Homes To Avoid
Backed up to a shopping center or land that is zoned for business.
Backed up to a street with lots of traffic. You will hear it at night.
The biggest, most expensive house on the block.
Avoid any home that you did not have a home inspection company view.
Remember, two bedroom two bath homes are harder to sell than 3 bedroom two bath homes.
Homes You Want To Buy
The least expensive house in an upscale neighborhood.
A house at the end of the block or a cul-de-sac. You’ll get less traffic.
Reasonably close to fire department and hospitals.
Reasonably close to the grocery store or work.
High ceilings, large kitchen, walk-in closets.
Newer home, upgraded appliances, higher efficiency AC, good insulation.
Location, location, location.
10 Reasons to Buy a New Home
When buyers visit new home site sales offices, it is important for their first visit to have their Realtor with them for optimal negotiating power and representation. Remember, the builder’s on site agents are representing the builder, NOT the buyer. The on site builder pays the buyer agent’s commission.
Top 10 Reasons For Buying a Brand New Home:
- It’s a Buyer’s Market: Being in the driver’s seat, buyer’s can get a great deal on a brand new home.
- More For Your Money: Builders are offering free upgrades, mortgage interest buy downs and other incentives.
- Tax Benefits: Uncle Sam knows home ownership benefits the nation and encourages it through deductions for mortgage interest and state and local property taxes.
- Great Selection: Ample inventory of new homes means more choices.
- Interest Rates: New historic lows.
- Equity: College expenses, consumer goods, retirement.
- Leveraging: Although down payments are small compared to the value of the house, over time, buyers benefit from increases in the total value of the property.
- Amenities: Gourmet kitchen, mini spa bathroom, home theater; builders work with buyers to make this their dream home.
- Energy And Resource Efficiency: New homes are energy efficient and constructed with resource-conserving materials and techniques to save money year round.
- More Space: Kids, pets, hobbies, in-laws.
Companies We Recommend
Cherry Landscape Inc.: www.cherrylandscape.com
Horizon Moving Systems: www.Horizonmoves.com
How to Optain a Mortgage
Please use the link on our webpage to use our preferred lenders. Of course, you may choose any lender, but be sure to read the following mortgage tips!
MORTGAGES: 3 Important Factors
When buying a home for the first time, obtaining a mortgage can seem like a difficult procedure that you don’t understand. Here is some basic mortgage terminology you need to know to make an informed decision, as well as choosing the right loan officer.
TERM: A mortgage term is the length of time you have to pay off your loan. It can be extended up to 50 years. Like any loan, the longer you have to pay off your mortgage, the lower the payment will be. An important mortgage tip – the shorter the term, the lower the interest rate.
RATE: The “rate” is the interest rate. The interest rate offered to you is dependent on your credit rating, how much you are able to put down, how much money you make and the value of the home you are buying. Rates change depending on the loan program.
COST: Costs typically refer to closing costs, which are a part of every mortgage. These usually include an appraisal, recording fees on documents paid to the title company, as well as additional fees outlined in your Good Faith Estimate, which you will receive from your lender.
Finding the right home may seem like the hard part of a real estate transaction, but in reality, getting the correct financing can be much harder. Your mortgage broker can prepare your options clearly with what you want in terms of loan term, ideal rate and targeted monthly payments. Your dream home is a click away!
Tips For First Time Home Buyers
Here’s what you can expect from your home shopping experience.Almost 80% of all home searches today begin on the Internet. With just a few clicks of the mouse, home buyers can search through hundreds of online listings, view virtual tours, and sort through dozens of photographs and aerial shots of neighborhoods and homes. You’ve probably defined your goals and have a pretty good idea of the type of home and neighborhood you want. By the time you reach your real estate agent’s office, you are halfway to home ownership.
Good real estate agents will listen to your wants and needs and arrange to show only those homes that fit your particular parameters. Your agent should preview homes before showing them to you as well.
How Many Homes Will You See?
Studies show that your memory dramatically improves after consumption of carbs and slows upon consuming sugar. So, lay off the soft drinks and have a hearty meal of carbs before venturing out to tour homes. The average number of homes that we show a buyer in one day is seven. Any more than that, and the brain is on overload. Therefore, don’t expect to see 20 or 30 homes; although it’s physically possible to do so, you probably will not remember specific details about any of them
How to Rate Inventory
Bring a digital camera and begin each series of photos with a close-up of the house number to identify where each group of home photos start and end.
- Take copious notes of unusual features, colors and design elements.
- Pay attention to the home’s surroundings. What is next door?�
- Do you like the location? Is it near a park or a power plant?
- Immediately after leaving, rate each home on a scale of 1 to 10.
View Top Choices a Second Time
After touring homes for a few days, you will probably instinctively know which one or two homes you would like to buy. Ask to see them again. You will see them with different eyes and notice elements that were overlooked the first go-around.
At this point, we would call the listing agents to find out more about the sellers’ motivation and to double-check that an offer hasn’t come in, making sure these homes are still available to purchase.
Both Fran and I have worked with many first time home buyers and we know the process very well. You can count on us to make the transaction smooth and fun!