Category Archives: Uncategorized

Real Estate Advice: Tips for a Fast Closing

Sandy Gadow

Now more than ever, buyers (and often sellers) want a speedy escrow closing. The standard escrow period takes 30 to 60 days to complete. The process can be slow and tedious, with lender approval, building inspections, title issues and “contingencies” written into the sales agreement.

Buyers and sellers get frustrated with the back and forth of providing documentation, signing off on inspections, negotiating who pays for what when defects in the property are found, and clearing up title defects such as old liens or easements that restrict the use of a portion of the property.

Let’s assume you have found the property you would like to buy, it is within your budget and it ticks all the boxes in terms of location, size and condition. You have started to prepare your existing home for sale — meeting with a Realtor to give you an idea of what will be needed to attract as many buyers as possible, such as correct pricing and doing necessary repair work.

Your Realtor may make a suggestion that your house be “staged,” or decorated and painted in a style that is currently appealing to the majority of buyers in the area. It is wise to listen to your Realtor’s suggestions and trust his or her expertise.

Once you have found a house you would like to buy, that purchase likely will be reliant on the sale of your existing house. With the current lack of inventory and high demand in housing, the ability to close quickly may make the difference between getting exactly the property you want and settling for a property that is less desirable.

How can you bypass a standard 30- to 60-day close of escrow and take the fast track to closing?

Seller tips

  1. Choose a Realtor who is well-versed in your neighborhood and has a proven track record of sales in the area.
  2. Tell your Realtor upfront that you want a fast closing.
  3. Consider offering your Realtor a higher commission than normal. If the standard for your area is 5 percent of the sales price, offer 5½ percent. If the standard is 6 percent, offer to pay 6½. This increase benefits your Realtor and the Realtor who represents the buyer.
  4. Get inspections done before you list your property for sale.
  5. You want to be able to sell your property “as is.” To do that, get inspections you feel might be pertinent to the structural integrity of the home for the roof, plumbing, foundation and other structural components, such as electrical, water, sewer, heating and other mechanical systems. Have information on environmental hazards such as lead, asbestos, mold and radon. If selling a condominium, provide a copy of the homeowners association bylaws and the association’s application for approval for new buyers.
         Your goal is to sell your property to prospective buyers and do the legwork for them. Anticipate questions that may be asked and have answers in hand, with backup documentation if necessary. Be prepared to answer questions about things such as break-ins in your neighborhood or in your home.
  6. Check the title report you received when you bought the property and verify there are no outstanding title issues or easements that could be of concern to a buyer.Newsletter

Buyer tips

  1. Contact the listing agent for the property you are interested in purchasing and say you would like him or her to represent you in buying the new property and would use the agent to sell your existing property. This gives the Realtor the potential of earning double commission — one on the purchase side and another on the sale side. “Dual agents” are bound by confidentiality, loyalty and full disclosure. Dual agency representation is legal in all states except Alaska, Colorado, Florida, Kansas, Maryland, Oklahoma, Texas and Vermont.
  2. Be upfront with your Realtor that you want a fast closing, such as seven to 10 days.
  3. Ask your Realtor which escrow and title company he or she recommends and which company has a record of handling fast closings. A closing company that your Realtor has worked with before can be helpful. He or she may have a good working relationship with that escrow officer and know what is required to help the closing move forward rapidly.
         Not all escrow closing companies are the same, and you want a company that can provide fast title reports and is experienced in dealing with problems if they arise in the escrow process. Ask how busy the company is and ask for the senior escrow officer to handle your closing.
  4. You can do your own research of escrow companies by calling around about your specific needs and finding ones that state they can handle what you require within your time limit.
  5. Offer an all-cash, no financing contingency purchase.
  6. Offer to waive any contingencies, inspections or other specific clauses that would require further negotiation with the seller — or keep your contingencies to as few as you feel is justified. Do your best to keep your offer free of possible holdups that could make the seller less likely to accept your offer over others.
  7. Offer a larger down payment than typically required. Rather than 20 percent down, offer 25 percent.
  8. Stay in touch with your Realtor and closing officer daily. Most real estate documents can be signed digitally via a platform such as DocuSign. Anyone can sign and manage documents anytime, anywhere, on any device, eliminating the need to show up in person at the escrow or title company.
         Some states require that the deed and loan documents be signed in front of a notary public. In those cases, the escrow company or lender will send the papers to you and you can hire a mobile notary to come to you to acknowledge your signatures at your convenience and choice of location.
  9. Ask the escrow officer for wiring instructions for you to send in your closing funds. Then notify your banking institution that you will be transferring a large sum to that company’s account. Ask for the time lag — if any — to wire the funds to be sure they arrive before or on the day of closing.

These tips are reliant on your advance research to find the property that fits your needs. You can gather information yourself online and in person, and/or contact a Realtor who has a record of sales in your area.

An expert Realtor can save you valuable time by providing documentation and statistics on the area you want, the pros and cons of that location, the trending appreciation in the area, if applicable, the proximity to schools, medical facilities and shopping, and workplace commute time.

Give your Realtor a wish list of the most important criteria you have. When you find the right property, you will be ready to act swiftly and close in record time.

What Home Buyers Need to Know about Seller Disclosures

Sandy Gadow

It’s all too easy for property buyers to be lulled into a false sense of security by the seller’s reported disclosures about potential issues with the house you’re considering buying.

Although all states require some form of property disclosure statement, the extent of what must be revealed can vary from state to state, county to county and even city to city.

Federal law requires certain disclosures, such as the existence of asbestos or lead-based paint in the home or other known health or safety risks. But the enforcement of other disclosures (such as reporting certain environmental conditions pertinent to the area, or the existence of Megan’s Law offenders) will be determined by local ordinance or law.

The typical seller disclosure form is several pages long, and it asks the seller to report known defects in the home. This will include the appliances, as well as information about electrical, heating, sewer, water or other mechanical systems. The roof, foundation and other structural elements will be included in the report, as well as latent or hidden defects that are not apparent from a visual inspection, such as: the presence of mold, a crack in the foundation or a prior flooding problem.

Anything that is known — and that could pose a possible threat to the health or safety of the buyer — must be disclosed. If the seller is not aware of these problems, however, he is not obligated to hire an independent investigator unless that is stipulated in the purchase contract. Natural hazard risks, such as earthquake fault, fire or flood zones, should also be disclosed.

But just how detailed must the seller be? In most states, sellers are required to disclose only what they already know. They are not held responsible if they answer “no” or “unknown” to one or more disclosure questions. The disclosure paperwork defines the scope of liability for the seller, who “is not liable for any error, inaccuracy, or omission for information that is not within the scope of [his or her] actual knowledge.”

In other words, a seller could legitimately be unaware of serious problems — like a cracked foundation, termites deep in the walls or a roof on the verge of leaking. Under those circumstances, in most cases, the seller wouldn’t be held responsible.

Some states allow the seller to sign a waiver or disclaimer statement rather than require a full disclosure of all known defects. In Maryland, for example, if the seller opts to sign the Residential Disclaimer Statement and sell the property in its “as is” condition, he is required to report only latent defects. That means those that are not clearly apparent by visible inspection but pose a threat to the health or safety of the buyer or future occupant. Latent defects include the presence of mold behind the walls or a crack in the foundation.

You might assume that a newly built house would not have hidden problems, such as mold or an unstable foundation, but every buyer should still insist upon a full seller disclosure from the builder. Recently, a buyer purchased a new house, and before moving in removed a portion of the living room baseboard to install a built-in cabinet.

Behind the brand-new baseboard, he found black mold. Apparently, halfway through the construction phase the house had sat empty, and because of damp weather conditions the mold had established itself. Fortunately, after the building contractor was notified of the problem, a mold specialist was called, the floors and walls were treated, and all the damaged wood was replaced — at the seller’s expense.

In Virginia, sellers must disclose if their property is in any locality that includes a military air installation. While in the District, homeowners must report historical designation of their homes before selling.

Here’s how to complete your own disclosures:

  • Go to your state’s Department of Real Estate and review the Seller Disclosure Statement requirements.
  • Get a copy of the neighborhood crime report to track petty theft or home break-in trends. The local police station can tell you if there has been a change — whether in a good or bad way — in the area.
  • Ask the local municipality water and sewer management district if there are major road works or water main upgrades planned.
  • If you are concerned about radon or hazardous materials, you can go to the Environmental Protection Agency’s Web site www.epa.gov. Click on “Where You Live,” which lists the presence of radon by state and county and local area. Its Web site also provides air and water quality as well as other environmental information.
  • The city planning department can provide information on local ordinances, water, and street lighting or planned city works.
  • Contact the local fire department for smoke detector regulations. Depending on when the home was built, in some areas the seller must provide devices throughout the house before the property can be sold.

Being as proactive as possible at the beginning of your purchase will help ensure that you enjoy the property and avoid unwelcome surprises, repairs or major problems associated with your new house.