5 Ways to Protect Yourself as You Close on Your New Home

You’re so close to finally getting those keys. You’ve circled the closing date on your calendar and you’re headed toward the finish line. You feel ready. But ARE you?

Grab a pen and paper and get set to check off the final to-do list. (Be sure to check with your real estate agent and closing company for full details.) We’ve included some tips to protect you and your investment in the home stretch! (Get it? HOME stretch?)

 1. Clear your title

Your mortgage lender will require a title search, and you’ll need to purchase title insurance. This protects you from ownership claims by another party or any hazards on the property itself.

PRO TIP: Read our blog, “What exactly IS a clean title (and how do I get one?)” As always, we at Clean Title are here to help!

 2. Check-in with your loved ones

Buying a home is one of the biggest (and costliest) life decisions a family makes. It can be really challenging for a relationship. 

PRO TIP: Take a minute (and a deep breath!) and confirm you’re on the same page. You should both be feeling confident about the process. If not, check out our blog, “Can I back out of a home purchase before closing?

3. Check off that pesky paperwork 

When you entered due diligence after signing the contract, you got a whole list of things to do to move forward with the sale of the home. How’s that going? 

PRO TIP: Don’t be afraid to check often. Asking a lot of questions and being forceful with your requests can save you a lot of time if things look like they’re stalling out. Here’s just a smattering of what you need to verify:

  • Is the appraisal completed?
  • Is your financing and mortgage paperwork moving forward? 
  • Has your home been inspected and are repairs underway? 

Taking care of these contingencies also protects you from losing money in a home purchase. See our blog post “5 things to expect after your offer is accepted (and how to avoid pitfalls)” for more details. 

 4. Review the closing disclosure

This official document, also known as the settlement statement or HUD-1, states your exact mortgage payments, the loan’s terms and closing cost fees you’ll be expected to pay.

PRO TIP: Your lender gave you an estimate for your loan. Make sure to put the estimate side by side with the closing disclosures to look for any differences. This will let you know how much money to bring the closing and in what format (Certified check? Cashier’s check? Sometimes even a credit card!)

 5. Do a final walk through

The last thing to do, usually the day before closing, is to revisit your soon-to-be home. Verify the required repairs are completed and there hasn’t been any damage since your home inspection. Is everything the seller agreed to leave still in place?

PRO TiP: get all your paperwork together the night before closing. You’ll need:

  • Proof of homeowners insurance
  • A copy of your contract with the seller
  • Your home inspection reports
  • Any paperwork that the bank required in order to approve your loan
  • A government-issued photo ID
  • Your funding for closing costs

BONUS TIP

Three more things you’ll need at a closing: your real estate agent, your patience, and a strong hand. (You’ll be signing so many documents!) But since you’ve prepared carefully—thanks to your diligent research and a little advice from this blog—this part is a walk in the park. And right afterward, it’s a walk through your new front door. Congratulations!

 

At Clean Title, LLC, we’re researching the past to protect your future! We’re very proud of our track record and the recommendations our clients have shared. (Check out some of our reviews on our Facebook page.)

Check out our home buyers’ Clean Title FAQs and reach out at 985-277-5095 anytime with questions!

Disclaimer: This blog is not intended to give legal advice. Keep in mind that each state has different real estate laws and that throughout Louisiana, rules, and customs can vary among parishes and regions. If you’re buying or selling a home, please check with your local Real Estate professional or Real Estate Attorney on the specifics of all Real Estate matters.

Can I Back Out of a Home Purchase Before Closing? (Your Earnest Money Says Yes!)

This blog is a continuation of last month’s blog about due diligence but is not intended to give legal advice. Each state has different real estate laws and throughout Louisiana, rules and customs can vary among parishes and regions. If you’re thinking of buying or selling a home, please check with your local Real Estate professional or Real Estate Attorney on the specifics of all Real Estate matters.

There are dozens of reasons to back out of a home purchase. Stumbling across a better house. Realizing your commute to work is going to be brutal. Discovering from the foundation repair company that there’s more to the damage than meets the eye. Your wife’s mother gets ill and you need more space to move her in with you. Or, as the date of your closing looms, you just simply change your mind. 

Last month we talked about 5 things to expect after your offer is accepted <<link here>> and how to survive the waiting game we call the “Due Diligence” period. 

There’s a short time frame when due diligence is over, the title search is complete, inspections are in, repairs have been settled and all that’s left is your lender’s paperwork for closing. It’s a time when most people cross their fingers into the finish line. But for those who find themselves experiencing doubts or issues, it’s a time when earnest money can get you out of buying the home.

Some fast facts about earnest money

  • When you’re signing a contract to buy a home, you’re very likely going to negotiate a deposit called earnest money. 
  • Earnest money is also called a “good faith deposit” since it indicates you’re moving beyond home shopping and are truly interested in a valid home-buying contract.
  • The amount of earnest money is most often a percentage of the cost, usually between 1% and 2% of the selling price of the house. 
  • Deposits go into a trust until closing and get applied to your down payment on the home at that time. 
  • Earnest money isn’t meant to go directly to the seller. It’s safest when put in escrow with a third-party title company (like Clean Title, LLC).

Earnest money can seem like just another big expense during your home buying process. But it’s extremely important and often for your protection.

Here’s why:

  1. Proving to the seller that you’re serious about your offer
  2. It protects you if something is wrong with the property
  3. Protecting you if your life situation changes
  4. Also, it protects the seller if you simply want out of the deal 

So let’s say you decide this sale isn’t for you.

It could be any of the reasons above. Or any reason at all. You simply agree to sacrifice your earnest money (and the due diligence funds) and walk away free and clear.

That funding acts as a reimbursement to the homeowner for time and trouble spent taking the house off the market and walking through the contract process with you. Since they’re now starting over listing their home, it’s only fair to help soften that financial blow. 

You might feel horrible about losing such a large amount of money. But ask yourself one important question. Which makes more sense: to forfeit 2% of the cost of a home? Or to agree to take on 100% of the cost of a home you no longer want? 

When you look at it that way, earnest money is cheap insurance. 

At Clean Title, LLC, we’re happy to serve you during your home buying process and proud of our track record and the recommendations our clients have shared. (Check out some of our reviews on our Facebook page). Clean Title, LLC, is researching the past to protect your future!

Check out our home buyers’ Clean Title FAQs and reach out at 985-277-5095 anytime with questions!

Stay tuned next month where we talk about protecting yourself before closing and the all-important closing checklist on your new home!

5 Things to Expect after Your Offer is Accepted (and How to Avoid Pitfalls!)

So they accepted your offer! Now what?

And so begins a time for nail-biting and heavy hopefulness known as due diligence.

Here’s what to expect from there:

What in the world is due diligence?

Once a contract is signed, you’re officially in the “due diligence” phase. As a prospective buyer, you’ll pay a non-refundable fee–usually $500 to $2,000–within 24 hours. (This isn’t to be confused with earnest money which we’ll cover in next month’s blog.) In a way, a due diligence fee holds your place in line for buying a house. It gives the seller a little credit for taking their house off the market while you negotiate and gives them a small cushion should you decide to abandon the contract.

The due diligence fee is often negotiated by the buyer who wants the fee as low as possible. Buyers want the option to get out of the contract with the smallest loss if they decide not to buy the house. If it’s a particularly hot property, buyers may battle to offer the higher due diligence fee to prove their intentions. It’s typically non-refundable. 

Due diligence does not apply to new construction.

What happens during due diligence?

Most due diligence periods last between 15 and 30 days. That gives you as buyer time to set up a professional home inspection, HVAC inspection, and termite inspection completed. Buyers may also want other specialized inspections such as a pool, septic, or radon inspection. And if you’re buying an older home you may need additional inspections.

This time period is also used to authorize or undertake the loan process. 

Finally, and critically, due diligence is a great time to start the Clean Title search!

What happens after the inspection?

Things get really interesting with the inspection report. You have to make the tricky decision to ask the seller to fix any major repair items that turn up. 

One option is to simply have the seller agree to fix any issues, at their expense, prior to closing. Another common choice is to ask for a reduction of price or a repair allowance from the seller. Some buyers might even choose to help with closing costs instead. 

Sometimes, when an agreement can’t be reached, the buyer will cancel the contract and walk away from the sale.

Wait. Can I really get out of the contract for no clear reason?

Yep. That’s what the fee is for. If you decide, before the end of the due diligence period, not to move forward with the purchase of the home, you can walk away for any reason (or no reason at all). You’ll only lose your due diligence fee. If you ultimately decide to buy the home, the due diligence fee carries forward to the closing and gets credited towards the purchase price. 

The only instance in which the due diligence fee is refundable is if the seller breaches the contract.

So how do I avoid issues in the due diligence time period?

Your best bet is to follow the advice of a professional Real Estate agent and to talk to a reputable title company with exemplary service and care. A good team backing your efforts will keep you informed of what’s happening every step of the way. They’ll stay with you until that day you sign on the dotted line and make that house a home!

At Clean Title, LLC, we’re proud of our track record and the recommendations our clients have shared. (Check out some of our reviews on our Facebook page). Clean Title, LLC, is researching the past to protect your future!

Check out our home buyers’ Clean Title FAQs and reach out at 985-277-5095 anytime with questions!

Stay tuned next month where we talk about earnest money and a checklist for closing on your new home!

Disclaimer: This blog is not intended to give legal advice. Keep in mind that each state has different real estate laws and that throughout Louisiana, rules, and customs can vary among parishes and regions. If you’re thinking of buying or selling a home, please check with your local Real Estate professional or Real Estate Attorney on the specifics of all Real Estate matters.

When your Home is also your Office (and you can’t move!)

A Sign of the Times

A look at local home listings paints a sign of the times. For example, “Extra bedroom would make a great office!” Or “plenty of room for a desk … bonus room ideal for setting up work/study from home.” And here’s a classic, “backyard space perfect for adding an office outbuilding.” 

It used to be that most of us left home for work. Nowadays, a combination of better technology, the changing economy, and the pandemic means that many of us find our desks a whole lot closer to our beds than ever before. (Closer to the kitchen too, but that’s another blog for another day.)

 

We all need a little space to call our own. So what do you do if you’re struggling with living, working, and schooling out of your home, but you can’t or don’t want to purchase a new home

 

When You Just Don’t ‘Fit’ Anymore

You don’t necessarily need a new home. But you do need to be creative! Take a hard look at the space you have to work with. Make a list of your existing spaces then star any spots where you can carve out a nook or set up a station. 

 

Consider these: a guest bedroom, the laundry room, space under the stairs, a wide hallway, a walk-in closet. The barely-used formal dining room is becoming extremely popular with the work-from-home crowd. If your work requires phone and video calls, privacy (and maybe a locking door?) is likely to be your top concern. 

 

It Doesn’t Have to be a Huge Space

One mistake some people make is assuming you need an executive workstation. In fact, a comfortable chair, a small table with room for a cup of pens, a notebook and a laptop might do the trick. A catch-all basket can help keep you tidy. Think about keeping a file cabinet in a nearby closet for organizing overflow.

 

Nowhere to go But Up

You might find that more shelving in a den, more cabinets in a laundry room, or more overhead racks in a garage will open up the space you need. Can you remove a too-large piece of furniture? Add a space-saving, fold-up Murphy bed? Ask a friend for a second set of eyes to help you rearrange and find the space to set yourself up.

 

Don’t Skimp on the Details 

It doesn’t have to cost a mint, but be sure to pick one or two items that make the new space special. On your day off, add some fresh, light-colored, neutral paint. (White is best for small spaces.) Be sure to rearrange some art to your new office, too. Something to look at and take comfort in during all those Zoom meetings.

Picture a new work environment–or maybe just a sitting space to get away from it all. In this “new normal,” it might be all you need to improve your efficiency, productivity, and calm. 

 

When the timing is right and you do choose to buy, you’ll need a title on your new home. For professional assistance on the close on your sale, keep Clean Title, LLC, in mind. We’re researching the past to protect your future!

Don’t miss our popular Title FAQs for tips that will give you the peace of mind only a clean title can. See us on our Facebook page and check out details of our services on our website. Or call 985-277-5095 to speak to one of our title professionals today!

5 simple, Affordable Ways to Spruce up your House this Holiday Season

 

Shifting that unused vacation fund to tackle much-needed home repairs might be an easy choice this year. But if your income has seen an impact due to the pandemic, you don’t have to feel left out in the cold. You can still add some sparkle with your own low-cost home-improvement flair.

 

Want easy? Fast? And best of all, cheap? A little light landscaping and some fresh paint are your best bet. But here are a few more clever ways to upgrade your home without breaking the bank. Check out these five perfect projects for all that quality time at home during the 2020 holiday season!

 

Black Door Knobs

Tired of those ’70s gold plated knobs? Change out your hardware and there goes your repair budget. But check out a tube of black metallic wax ($8-$10) and now you’re in business. There are copper and silver tints as well. (First, be sure to check the finish on the inside of a backroom or on closet hinges to confirm you like it! If not, oil-rubbed bronze spray paint is your plan B.)

 

Carriage Doors on the Garage

A regal carriage door for your garage can really drive demand! While it looks great, it can certainly cost you your crown. Fear not, fair damsel in distress! Magnetic hinges and handles to the rescue. No drilling necessary! (Add faux windows for just $20 more.)  

 

Shiplap Wall Accent

Nothing makes a modern house look more classic than an accent wall. And it doesn’t take a master craftsman to build one. You can use the planks from pallets or trimmed plywood pieces. Stack them horizontally and attach them to your wall with anchored screws and construction adhesive. (Pinterest is the place for ideas and directions!)

 

“Vintage” Floor Tile 

You can spend the weekend (and empty your bank account) replacing your flooring. Orrrr… you can try some vinyl sticky tiles. It comes in amazing patterns and colors. Give a small, drab area a 10-minute makeover with a pop of bright, fun style!

 

Shower Curtain Pick-me-up

This one’s practically cheating. Treat yourself to a new shower curtain! You’ll love the look and your family will thank you. It’s the next best thing to a whole bathroom renovation. 

 

Make the most of this most wonderful time of the year with a few simple changes that go the distance and make your whole house shine for the holidays and into the future!

Don’t miss our popular Title FAQs for tips that will give you the peace of mind only a clean title can. See us on our Facebook page and check out details of our services on our website. Or call 985-277-5095 to speak to one of our title professionals today!

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