Closing Costs Explained Visually

 

Purchasing a home is exciting. Once escrow begins, the excitement can change to frustration, particularly if you are not ready for the closing costs that quickly accumulate.

Closing costs simply refer to the fees associated with various things associated with the escrow process in a real estate transaction. In the excitement of having an offer accepted for your dream home, you can easily lose track of the fact you are going to need to have some serious cash on hand to pay them. Many people make the mistake of only assuming they need the down payment money, and have to rush around town trying to come up with money for the closing fees.

Do yourself a favor, and discuss closing costs in advance with your real estate or mortgage person.  And watch this video to have a good mental picture of the costs that you’re likely to incur.

Suncoast One Title has locations in Punta Gorda, Port Charlotte and North Port Florida

 

What Are Real Estate Commissions?

 

Like the video says – real estate agents aren’t paid by the hour!They’re paid a percentage of the purchase price in a successful real estate transaction.

When one agent represents the sellers and another represents the buyers the commission is typically split between them.
In the US, real estate commissions are commonly 6% of the transaction usually 3%/3% when split.

No government or industry body sets commission rates.  Legally, commission rates ARE negotiable.  However, remember that agents only earn their commission on successful sales.

Consider the work you want them to do for you to evaluate the value you should put on the commission they earn.

Suncoast One Title has locations in Punta Gorda, Port Charlotte and North Port Florida

What Steps Need To Be Taken To Secure A Loan?

 

You’ll see some pictures in this video to help you remember later, but the first step in securing a loan is to complete a loan application.

To do so, you’ll need the following information.

  • Pay stubs for the past 2-3 months.
  • W-2 forms for the past 2 years.
  • Information on long-term debts.
  • Recent bank statements tax returns for the past 2 years.
  • Proof of any other income.
  • Address and description of the property you wish to buy.
  • A sales contract on the home you want to buy.

During the application process, the lender will order a report on your credit history and a professional appraisal of the property you want to purchase. The application process typically takes between 1-6 weeks.

Suncoast One Title has locations in Punta Gorda, Port Charlotte and North Port Florida

What Is An Escrow Account? Do I Need One?

 

As we show you in this video, an escrow account is an account, established by your lender, to set aside a portion of your monthly mortgage payment to cover annual charges for homeowner’s insurance mortgage insurance (if applicable), and property taxes.

Escrow accounts are a good idea because they assure money will always be available for these payments.

If you use an escrow account to pay property tax or homeowner’s insurance make sure you are not penalized for late payments since it is the lender’s responsibility to make those payments.

Suncoast One Title has locations in Punta Gorda, Port Charlotte and North Port Florida

What Are Discount Points?

 

Discount points allow you to lower your interest rate. While this video simplifies things to help you remember, “points” are essentially prepaid interest with each point equaling 1% of the total loan amount.

Generally, for each point paid on a 30-year mortgage the interest rate is reduced by 1/8 (or.125) of a percentage point.

When shopping for loans, ask lenders for an interest rate with 0 points and then see how much the rate decreases with each point paid.

Discount points are smart if you plan to stay in a home for some time since they can lower the monthly loan payment.

Points are tax deductible when you purchase a home and you may be able to negotiate for the seller to pay for some of them.

Suncoast One Title has locations in Punta Gorda, Port Charlotte and North Port Florida

What Should I Look Out For During The Final Walk-Through?

 

Well, as this story shows, this will likely be the first opportunity to examine the house without furniture giving you a clear view of everything.
Check the walls and ceilings carefully as well as any work the seller agreed to do in response to the inspection.
Any problems discovered previously that you find uncorrected should be brought up prior to closing. It is the seller’s responsibility to fix them.

Suncoast One Title has locations in Punta Gorda, Port Charlotte and North Port Florida

Title Insurance Explained Visually

 

What is title insurance and why should any buyer get it when purchasing a home (single family, townhouse, condo, apartment, or whatever format your home purchase takes)? Doesn’t the attorney or settlement company handling the closing see to it that you have a clear title? Isn’t this just another way for someone to siphon a few coins off a real estate transaction?

Title insurance prevents the property owner from suffering financial loss if, at any time during his ownership of the property, someone comes along who can show that they have full, or partial, ownership of the property instead.

A careful title search is done at the time property changes hands. On rare occasions mistakes are made anyway. Property can change hands in a number of ways including by deed, by will and by court action. Typically, these proceedings are recorded in different places. Searching the history of ownership to be sure nothing has fallen through the cracks is a tedious job that requires alertness, intelligence, and skill.

It is very likely that the value of your property will go up over the years. As time passes, these elements are likely to result in your home equity’s being your largest asset. Just how devastating would it be if you eventually discovered that someone else owned what you’d always thought was your home?

Do yourself a favor. When you buy a home, buy title insurance.  And watch the video to understand the essentials.

Suncoast One Title has locations in Punta Gorda, Port Charlotte and North Port Florida

How Should I Prepare For Internet Showing?

 

Today, your first “showing” will be on the Internet – you’re watching this on the Internet, right?

Your price, listing description and PHOTOS determine whether someone will visit in person.  Consider professional staging advice or help.

Prep for photos and video just as carefully as real visits.

Ask your realtor if they use a professional photographer

If they do look at prior photos and pick someone who understands the job.

Photos should make the most of your home’s features and give prospective buyers an emotional connection that invites them to visit in person.

Help them envision their lifestyle in the house not just the counters and walls.

If your realtor recommends video, just as with  photography stage it carefully and hire a professional it will pay off.

And look over your listing when it goes live on a computer AND a mobile device to make sure it’s accurate, pleasant and compels people to show up.

Remember – your first showing these days will be on a screen.

Suncoast One Title has locations in Punta Gorda, Port Charlotte and North Port Florida

How Should I Prepare The Outside For An Open House?

 

Professional “staging” may include the exterior, but if you’re doing it all yourself, try the five things outlined in this video.

1 – Landscape & lawn.

That’s the first impression; make it a good one.

Mow, prune, edge and get rid of junk!

2 – Paint And Clean!

You don’t have to do the whole house, but the front door and lintels should either be painted or cleaned.

3 – Leaks & Repairs

Small visible problems can become large mental objections and change how someone feels about your house.

Fix ‘em beforehand.

4 – Pets

Some people have allergies and concerns.

Time for Fido to visit a friend.

You weren’t including him with the house anyway.

5 – Get Fresh Eyes

Have your realtor or a friend who’s willing to be candid tell you what you missed. Or pay a staging professional for a report.

We don’t really see familiar things well – so let them be your

‘test buyer’ so you can present the best first impression to the real ones.

Suncoast One Title has locations in Punta Gorda, Port Charlotte and North Port Florida

Which Square Footage Figure Should I Use?

 

Home size is one of the key figures used in comparisons.

But you may have different measurements to choose from,  as you’ll learn in this video, including builder, appraiser, tax records and possibly owner records.

Which one is right, and which one is best?

The official figure is the one in tax records – typically, the county.

Any other figure must be documented by a builder’s floor plan

an appraisal or an official floor plan, prepared by a company for a fee.

If your house has been remodeled and you’re planning to sell

you may want to confirm that the official record matches your actual house – and update if required.

Most lenders will require an appraisal which will verify the figures you used. So be accurate and keep records to make the most of your sale.

Suncoast One Title has locations in Punta Gorda, Port Charlotte and North Port Florida