Wednesday, November 30, 2016
Helpful Pointers for First Time Home Buyers
9:16 am cst
Buying a home can be overwhelming. Sometimes you may feel like gathering paperwork and communicating
with your team is another full time job! Here are some tips to help make the process more stress-free.
1. Don't Make Large Purchases Before You Apply For Your Loan: This is a big one. Lenders look at your
credit score during the application process, and then again just before closing. Keep your credit profile clean. If you accumulate
a bunch of debt just before, or during the process, it can cause your loan to be denied. Don't make any large purchases before
your closing, either. Lenders will look at your score again just before closing, and it may cause issues.
2. Don't Worry About Whether It's The Right Time: Any time is the right time to buy a home. This time
of year, people shy away from buying because of the holiday season. Don't stress. You can't predict the housing market, and
you might miss out on a great opportunity.
3. Don't Focus Just On The Rate: There
are other costs involved with buying a home. Don't focus on the rate only. There are HOA fees, insurance, taxes, and closing
costs that need to be paid as well.
4. Hire A Home Inspector: Do NOT buy a home
without hiring a home inspector. This is NOT the area to be trying to save money. It will be the best $300-500 you spend.
A home inspector will give you the complete picture of the condition of the home, let you know what maintenance items to budget
for, and keep you from buying something you'll regret.
5. Hire A Real Estate Attorney:
Again, no skimping on this. Lawyers are important to the process (and I'm not just saying that because I am one). You'll
need someone to review title, deed and loan documents. You'll need an advocate for attorney review and home inspection items.
The $400-800 you spend on a lawyer is another great investment to ensure things are right at closing.
Scope Out the Neighborhood: Before you make a purchase, check out the neighborhood. How close is it to things you need
to get to? Do you need public transportation? Is it close to the grocery store? Your kids' school? Drive by the house at different
times of the day and evening. You may love a neighborhood during the day, but may hate it at night.
Relax: Home buying is stressful. But it's also supposed to be fun. Don't stress about the little things, and listen to the
people you've hired to help you - lender, Realtor, attorney, home inspector. We have done this thousands of times. We know
how things go. Take our advice.
Wednesday, November 2, 2016
How Should An Unmarried Couple Take Title?
11:03 am cdt
I have a lot of clients that purchase property together who are unmarried. They always ask me how
they should take title. There are two choices for this: Joint Tenancy with Rights of Survivorship, or Tenancy in Common.
When a couple takes property in Tenancy in Common, each person would have a divisible interest in the property.
Typically this is a 50-50 split, but it does not have to be, and can be expressed in the deed as a different percentage split.
Regardless, if one person passes away, the interest of the deceased would go to him or her estate and be distributed accordingly.
If a judgment creditor wants to collect money from the deceased, the property can be sold to satisfy the debt, but only the
deceased's half would be subject to the collection. The survivor may be required to sell the home, but he or she would get
his or her portion of the proceeds from the sale.
In joint tenancy, there is not divisible
interest. The party owns the entire property together, and if one of the owners passes away, the survivor would have ownership
of the entire property without probate. If you are taking property in joint tenancy, please make sure that the phrase "with
rights of survivorship" are always added, as every state's requirements for this language differ.
Some lawyers will recommend joint tenancy for couples, while others recommend joint tenancy. I make my recommendation
on a case-by-case basis. If you do purchase property without being married, please consider a partnership agreement which
would define what would happen to your property should your relationship end. And if you do get married, change the title
of your deed to tenancy by the entirety to protect your assets against individual liability.