Nov 20, 2020

Covid & Real Estate Closings

What do the coronavirus and real estate closings have in common? Hopefully not that much. But now that I think about it, there are some dynamics that both a pandemic and a real estate transaction share. 

Regardless of how much or you plan or what precautions you take, unpleasant things can happen. Just like your chances of catching the coronavirus, it is not likely that you will have problems if you are doing what you are supposed to do. Nevertheless, you may be that small percentage of unlucky people who have to deal with problems. While closing setbacks won’t literally kill you, they can be frustrating, and both emotionally and financially draining. 

Plan, plan, plan … and then be prepared to adjust your plans. Look to your title company and lender for advice and indications that everything is on track for a smooth closing. I like to hope for the best but have back up plans for the worst-case scenario.

Be wary of scammers and fake news. Criminals and swindlers have not taken a break during this pandemic. They are active and continue to target homebuyers and sellers. Be wary of wire fraud, email hacking, and scams.

Avoid the crowds. Schedule your closing when title companies and lenders are not as busy. You will have more choices for a closing appointment, get more attention and experience better service. Fridays are typically the busiest days of the week. The last day of the month is usually the busiest time as well.

The odds are in your favor that everything will work out and be fine. It takes cooperation from all parties. It may not be fun. There may be challenges. However, if we work together, we can overcome them.  We share a common goal of getting your transaction smoothly across the finish line with minimal issues for everyone. You are not alone in this.

However, unlike the coronavirus, closings can be happy events. We hope you are either getting keys to a home or money from a sale. Or maybe you are getting a better interest rate on your mortgage. While you are staying safe and sanitized in your everyday life, remember to stay cooperative and committed to your closings.

[where: 75230]

May 2, 2020

Closing Costs in Texas - A Comparison

Recently released national closing cost data showed that in 2019 average closing costs remained flat despite an increase in home prices. The average closing costs in Texas was $3,744 with an average sales price of $274,163.

The average closing costs in Texas was 1.75 percent of the sales price. That put Texas ranked 28th in the country for closing costs based on percentage of sales price.

The closing cost data, announced by ClosingCorp, calculated the cost of title insurance, appraisals, settlement fees, recording fees, surveys and transfer taxes. We don’t have transfer taxes in Texas. If we exclude those transfer taxes, Texas still ranks 28th in the country.

The states with the highest average closing costs, excluding taxes, were Washington DC, New York, Hawaii, and California. That is a reflection of both closing costs and average sales prices being high. If you look at the highest closing by state based solely on percentage of sales price, the highest states were Pennsylvania, Delaware, Washington DC, and Maryland. Their percentage averaged more than double the closing costs in Texas.

In most states, consumers can shop around and compare closing costs like they would a mortgage loan or homeowner insurance. Title insurance rates often vary based on several factors such as the purchaser’s credit scores or amount of their down payment. The escrow, legal, and closing fees can even vary from county to county within a state.

In Texas, the cost of title insurance is set and regulated by the state. All Texas title companies are required to charge the same for a title policy. The debate comes up every few years that Texas title insurance should be unregulated. The argument is usually that the free market and more competition would help reduce the cost to the consumer. The Texas Department of Insurance actually lowered title insurance rates in September 2019. For now, the system seems to be working well for our state. 
[where: 75230]

Mar 30, 2020

How title companies pay home sellers

When selling a property, everyone wants to collect a big check. Well, maybe not an actual paper check, but lots of money. If you’re getting funds from the sale of your house, there are a couple of ways to collect your money from the title company when it closes. Just a couple.

Would you like a check or a wire? Those are your basic choices. Title companies can also transfer the funds to another transaction if you are purchasing another property. But we’re not going to pay you in real paper cash, foreign currency, with PayPal, Venmo, Bitcoin or anything else.

If you want your funds as a paper check, keep in mind that your bank is likely to put a hold on the funds, thus keeping you from accessing the money immediately. How long a bank may hold a check depends on the check amount, how long you’ve had your account and the status of your bank account.

Your check deposit will have an automatic hold between one and 10 days business days before you can withdraw the money. You read that right. Up to 10 business days = two weeks. Check with your bank for details on held checks.

Most sellers prefer to receive their funds via wire transfer to their bank account. It’s pretty quick and simple. The title company will need your bank information, including account number, routing number, bank name and how your name appears on the account. All of that information is on a check. We know, no one writes checks anymore. So, dig one out of your desk drawer and bring it to closing. Or just look up your account information on your bank web site.

Don’t fret that sharing this information is risky. We’re all about protecting your financial data. This bank information is like a roach motel (where bugs check in but they don’t check out). We can send money into your account, but we can’t draw it out.

Typically, title companies don’t need your wiring information days in advance. I prefer to get the information at the closing table, directly from the sellers. Then there isn’t a risk of email hacking regarding their funds.

Banks have different wiring deadlines, which is why title companies like to schedule closings for earlier in the day. The deadlines for processing wires often range from 2 until 4:30 in the afternoon depending on which time zone the bank is located.

Before your funds can be wired there are several steps that must take place. Both buyers and sellers must sign all documents before they are scanned and sent to the buyer’s lender for review and approval. After the lender gives funding approval and all funds to close are at the title company, proceeds can be disbursed. That can take anywhere from 15 minutes to two or three hours.

Title companies are here to ensure sellers get their money. Help me, help you – and we’ll show you the money quickly.
[where: 75230]