Feb 1, 2019

Getting a Texas Homestead Exemption

A reader writes: “I bought a home in 2018 and my taxes are escrowed by my mortgage company. How do I get a homestead exemption to get a discount on my taxes? Do I need to repeat the process every year? How much does it save me?” 
You most definitely want to know how to file for a homestead exemption for your 2019 property taxes. To get a homestead exemption, you must own and live in the property as your principal residence as of Jan. 1 of that tax year. So, if you purchased in 2018, you may apply for that exemption after Jan. 1, 2019. 
A homestead exemption removes part of your home’s value from taxation, so it lowers your taxes. I don’t know the details about your home to tell you how much a homestead exemption can save on your property taxes, but it is generally about 20 percent. Given the property tax rates in Texas, it is worth the few minutes it takes. 
To qualify, your home must also be owned by you as an individual (or individuals). A corporation or other business entity doesn’t qualify for this exemption. Do not pay someone else to do this for you. It is free and you can do it online in a few minutes. 
Here is a step-by-step guide for how to apply for a homestead exemption in the DFW area: 
  • First you need to change the address on your driver’s license to your new home address. You may do that online as well for a fee. You’re going to need to submit a copy of your driver’s license or Texas ID card that shows the same address as the homestead property. Take a photo of it or scan it to upload with your online homestead application. 
  • Go to the appraisal district web site for your county appraisal district. Property tax sites for the DFW area include: Dallas County Appraisal District, Tarrant Appraisal District, Collin County Appraisal District, Denton County Appraisal District and Rockwall County Appraisal District. 
  • Find your property on the appraisal district site and open that page to show your account. There should be a choice for forms or exemptions. Just find the link and click on it. 
  • Follow the directions for filing your exemption and fill out the online form. You’ll need to upload that copy of your driver’s license. Without it, the application will be denied. But it is quick and easy. 
You will only need to do this one time for the property you are currently occupying. Once you receive the exemption, you don’t need to apply again unless for some odd reason the tax assessor asks you to repeat the application. 
The deadline to apply is April 30. But don’t procrastinate — do it now. 
The homestead exemption is only good for a property that you own and occupy as your principal residence. If you own more than one property, the tax folks will only allow you the one exemption. 
Look for your property tax notice in May. Your property taxes are determined by (1) how much the appraisal district says it is worth, and (2) the tax rate that your local government entities set. Those entities include the county, city and school district. 
If the assessed value is more than what you paid, you may want to protest the value. Instructions for protesting are included with your tax notice. 
The opinions expressed are of the individual author for informational purposes only and not for the purpose of providing legal advice. Contact an attorney to obtain advice for any particular issue or problem. [where: 75230]

Jan 25, 2019

6 Steps to Choosing a Title Company

It’s easy to make the general statement that all title companies are the same. They all offer the same services, and in Texas, they all charge the same for title insurance. However, it’s like saying that all Realtors are the same, or all home inspectors or insurance companies are the same. 
A closer look will reveal that there is usually a difference in the level and quality of service between companies. Working with a reliable, experienced, and caring professional can make the difference between an easy, positive transaction and a nightmare experience. 
Which title company you get into bed with can be like a marriage. Regardless of how it goes, you’re stuck with them for the duration of the time you own your home. 
The title company is referred to as a title agency or agent. The escrow officer is the person who handles your transaction and works for the title agency. Here are my recommended steps for choosing a good title agency and escrow officer: 
  1. Get a recommendation from a trusted source. Integrity, efficiency and reliability are the important factors you should look for. Many real estate agents develop preferences and avoidances for particular title companies based on their experiences. Bear in mind that escrow officers within a company can vary just like real estate agents in a brokerage operate differently. It helps to know who the particular escrow officer is that will handle your deal. Will you be working with that officer or be passed along to someone else?
  2. Verify they are in good standing with the Texas Dept. of Insurance (TDI). TDI regulates all title agents in Texas and conducts regular audits of these agencies. The most recent list of DFW area title companies with no fines or penalties for breaking the rules is in this article from July 2018. Keep in mind that lots of agencies have similar names. Look for the exact agency or you can review the complete report is see how they stack up here
  3. Confirm they are a member of TLTA, the Texas Land and Title Association. More than 90 percent of title insurance agencies licensed to do business in Texas are members of TLTA. It’s equivalent to a real estate agent being a member of the Texas Association of Realtors or the local MLS. TLTA provides continuing education, industry news and updates to members. Search the TLTA membership byeither individual escrow officer or ‘agents’ — which are title agencies. 
  4. Check their calendar for the week you plan to close. You want an efficient but thorough closing that is also convenient for your schedule.
  5. What are their affiliations? They should be a neutral party with no loyalty to either side in the transaction. Most title companies are not affiliated with a bank or real estate brokerage. However, if they are, it is something that you should be told.
  6. Ask a few more questions. Do they have attorneys on staff that you can speak with if necessary at no charge? If so, that’s plus. Do they own their own title plant? That’s another big plus. How many underwriters do they use to shop coverage? Two or three is ideal. 
There are hundreds of title agencies and thousands of escrow officers in Texas. Because our industry is so highly regulated, finding a really good one is pretty easy. 
The opinions expressed are of the individual author for informational purposes only and not for the purpose of providing legal advice. Contact an attorney to obtain advice for any particular issue or problem. [where: 75230]

Jan 18, 2019

Background Checks on You & Your Home

When buying or selling a home, get ready to reveal some private details through background checks. We’re going to pry, inspect, confirm, clarify, authenticate, and document a lot about you, your finances, and the property. Some of the surprises we unearth would shock your mother, but maybe not your banker.

Just how deep do the folks involved in your transaction probe? Well, there isn’t any kind of testing that involves getting ink on your fingers or peeing in a cup. Nor do we care about your driving record, your education level, your health, or your résumé.

But we will start with requiring your Social Security number and date of birth. We’ll also need to know your past and present marital status, and where you plan to reside after the sale.

As a seller, we’ll run a search of both your name and the property. When something unexpected pops up, like an Abstract of Judgement, a tax debt, or a couple of child support liens, we’ll tell you. This would be the time to ensure your spouse is aware of it as well.

I’m never sure if the “Oh, that” response means “I forgot about that” or “I didn’t think that would come up.” Sometimes, the response is “That isn’t me.” If it’s a common name, it may be true. But we will need to do more research. If the Social Security number or date of birth match those on a lien, I don’t want to call anyone a liar. But that smoke we smell is your pants on fire.

For the title company to close the transaction and issue title insurance, all debts and liens that affect the property must be cured. In other words, they must be paid off at or before closing. We’d rather see the closing date moved back or a sale terminated than to close a transaction without clear title.

The title company also runs the names of anyone purchasing or selling a property through the Patriot Act Name Search. This is a search of names published by the Office of Foreign Assets Control of the U.S. Department of Treasury. It consists of the “Specially Designated Nationals and Blocked Persons,” the “Foreign Sanctions Evaders,” and the comprehensive “Consolidated List.”

All title companies must comply with economic sanctions programs against countries and groups of individuals, such as terrorists and narcotics traffickers. If you’re on the no-fly list, you could also be on the no-buy list.

Your run-of-the-mill criminal usually isn’t prohibited from buying or selling a home. Even if you don’t qualify to buy a gun, you can still buy a house. But you might need to pay with cash.

For homebuyers, most of the vetting process is done by their mortgage company, who looks at income, credit scores, existing debt, etc.

Lenders may often run a background check on a potential borrower before issuing a mortgage on a property. A lender or home insurance company may deny a loan or insurance because of a criminal record if they desire. Especially if it involves a financial criminal act like theft or fraud. However, most only need enough financial documentation to show financial ability to repay the loan. They don’t want to risk giving money to someone who might not pay it back.
[where: 75230]