FAQ
FREQUENTLY ASKED QUESTIONS
We surveyed our real estate professional friends on Facebook and developed a list of frequently asked questions. These questions were provided by area Realtors, loan officers, and attorneys. Click on a question to see our answers and additional input and contact information for everyone who participated.
Dan Richton, Realtor
Dan Richton
"Closing costs generally run anywhere from $5,000 to $10,000 depending upon the price of the home and tax schedule for the city or town it is located in. Qualifying Buyers can also take advantage of a number of incentive programs provided by local municipalities and even their place of employment. Closings scheduled towards the end of the month can sometimes help buyers save a hundreds of dollars in upfront costs."
Dan Richton
Teamwork Realty Group
Call or Text: 413.374.3955
Dan@Teamworkrealtygroup.com
https://www.facebook.com/TeamworkRealtyGroup/
Teamwork Realty
Carlene Shannon, Lender, Branch Manager
"There are several reasons to start the process by getting your pre-qualification first:
- To make sure your credit and income are sufficient
- To see what products and programs are available to you
- Sellers DO NOT want someone who is not actually qualified to purchase a home, going through their home.
- Knowledge is power so you know what price range you should look in
- Be ready to put in the offer which cannot happen without a valid pre-qualification – don’t miss out
- Make sure you are being offered all options – not all lenders offer all products"
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Christine Libardi, Realtor
"You bet need a Buyer’s Agent!
To go see a property that is listed on the market, you HAVE to call a real estate agent to get you in the door. There is no way you can view the property alone. Also, navigating a real estate purchase is tricky business. The web has made it possible to do a lot of the legwork yourself, but there’s no substitute for an experienced professional. A crack negotiator who knows the market can save you time and money by helping you make the right offer—playing hardball when necessary—and staying on top of the process.
But don’t just call the agent on a listing to see the property!!! That agent is working for the seller, who (naturally) is trying to get you to pay top dollar for their home. You need a “buyer’s agent,” who represents you exclusively. In return for that exclusivity, you’ll likely have to sign a contract saying that you won’t work with any other broker for a specified period of time. Normally, you do not pay the Realtor a fee to have them represent you, they get paid out of the transaction by the Seller’s proceeds of the sale. That fee is already set up when the listing has been taken, that fee has to be paid to a buyer’s agent or the list agent can be a dual agent and get both sides but that agent has no loyalty to either side in that case and has to disclose that to all parties.
Even if a home is being sold by the owner with no Agent, a Buyer’s Agent can help you! Buyer’s Agents can still work with you on the transaction and help you negotiate the BEST DEAL! Most For sale by owners will pay a buyer’s agent fee!"
Christine Libardi, Team Leader
The Libardi Team
Keller Williams Realty
413-537-000
https://www.facebook.com/christine.libardi
Nora MacKay, Producing Sale Manager, Embrace Home Loans
"Okay. Short answer is, 'No.' Longer answer is a store card like that can only be used in that store."
1233 Westfield Street, Ste 2,
West Springfield, MA 01089
800.333.3004
https://www.embracehomeloans.com/location/massachusetts/west-springfield/nora-mackay
Timeline for Real Estate Closing
A conventional residential closing will take approximately 45 days to complete from the date that contracts are signed. For a more detailed review of all of the steps and timeline of a traditional residential closing click here.
Home Loan Application for Buying Real Estate
Most Buyers will start the home buying process by going to their lender to determine how much they qualify to borrow.
Closing Costs
Typical closing costs for a residential closings range from $5,000 to $7,000 depending upon the price of the home and many other factors. These costs include: 1) the lender origination, appraisal, processing and monitoring fees; 2) attorney due diligence fees including title examination, mortgage plot plan, tax review, title insurance and recording fees; 3) and escrows and adjustments.
As to who must pay the closing costs; it depends on what was negotiated between the parties. Typically it is the Buyer who must pay their closing costs (Sellers have their own series of usual closing costs). That said, it is common for the Buyer to negotiate the purchase price of a home and also request that he Seller pay up to $5,000- $7,000 in Buyer's closing costs, prepaid items and escrows.
It is important for first time home buyers to budget for the above referenced closing costs and some additional fees that they are responsible for outside of the "closing costs". These fees include inspection fees which can range from several hundred to over a thousand dollars depending upon the requirements of the home. For example, while most homes require only a structural and termite inspection fees, there are circumstances such as the existence of significant damage requiring an engineer, water tests for well water quality and septic system review (even if the Seller provides a passing report), suspicion of radon in the area, and evidence of asbestos or abandoned underground fuel storage tanks. Under these circumstances a battery of addition inspections would be warranted.
Immediately after inspections are resolved, the Buyer's lender will wish to order an appraisal. This charge is usually several hundred dollars. A Buyer should not authorize the appraisal to be ordered until inspections are completed and negotiated to their satisfaction. Otherwise the Buyer may end up paying for an appraisal for a home that they do not intend to purchase.
Finally, most lenders will require that he Buyer pay for one year of home owner's insurance up front. This cost can range from $600+! It is important that first time home buyers carefully review all o these costs and the timeline that they are typically paid in a purchase transaction.
John Wynne - Manager/Partner
Teamwork Realty"The most common question I get asked us who is the best attorney in Western Mass and I always say there’s only one, Nyles Courchesne"
- This is our favorite answer! - PCA LAW
Teamwork Realty
The "legal fees" are generally not fees that you pay over and above the "closing costs". The legal fees are actually included in the closing costs quoted by your lender. Following is a breakdown of common legal fees with a short explanation of each fee:
Attorney Fee: In a residential real estate transaction this fee can range from $650 - $950. This is the fee paid directly to the attorney for his or her services. These services include contract review, ordering and reviewing the title examination, tax report and mortgage plot plan (survey) - these items are described below. The attorney will coordinate the closing figures with your lender and the Seller and will calculate all the adjustment so that you can complete the closing by bringing one bank check to the Buyers and explain all of the closing documents. After the closing, the attorney will meet with the Seller's attorney to exchange documents. The attorney will then record the deed and additional recording documents. After the closing documents are recorded and the remaining bank documents will be forwarded to the Buyer's lender. The attorney will also write the title insurance policies and send the original deed, title insurance and other documents to the Buyer after the closing and address any post closing issues.
Title Exam: In Massachusetts the title must be examined for a period of 50 years. This examination includes a review of every owner for the past 50 years to see what mortgages or liens were placed on the property and how the liens were paid and the property transferred. It is the attorney's job to review this examination carefully to ensure that title will pass to the new owner without any issues. This examination costs approximately $250.
Municipal Lien Certificate: This is a certificate that the attorney will order from the City of own which shows the current tax status of a property. This certificate costs $50 in most cities and towns.
Plot Plan: A mortgage plot plan is a limited survey that the attorney orders to determine if there are any encroachment,l easements or rights of way that effect the buyer's use of the property. This plan costs approximately $250.
Recording Fees: These fess are usually $400 and include the cost of recording the municipal lien certificate, deed, mortgage, and declaration of homestead.
Title Insurance: The cost of a simultaneously issued Buyers' and Lender's title insurance policy is $4.00 per $1,000 of the purchase price plus $175. Discounts are available for first time home buyers. The lender;s policy is mandatory. It is insurance that the title is clear and the property is free from tax liens and physical encumbrances. It is highly recommended that the Buyer purchase an owner's policy at the time of closing to protect their interest in the property.
You can move in as soon as the deed is recorded unless you have made other arrangements in writing with the seller to move in before the deed had been recorded. In Massachusetts the traditional tell estate closing will involve an hour long signing session with the buyer's attorney. A few conditions must then be Merry before the buyer's attorney can record the deed:
- The buyer's attorney must obtain the deed. The buyers attorney will exchange the closing money for the deed in a separate meeting after he or she signs documents with the buyer.
- The buyer's lender must "fund" the loan. This is usually done by an electronic wire. However, wires take 2 hours to clear and are not instantaneous.
- The buyer's attorney must run the title one last time to ensure that no liens have been recorded.
Once all of these conditions have been met, the buyer's attorney will call the parties to let them know that the deed had been recorded and they can move in!
Inspection
There is no law that requires a buyer to pay for a home inspection before they purchase a home. However, obtaining a detailed home inspection from a licensed home inspector prior to closing is highly recommended. Further, certain loan products require the buyer to have inspections on order to qualify for the loan.
Buying a home is an emotional experience. Even professionals make mistakes when purchasing their own home.When a person is buying their home, even if they are a licensed contractor, they should consider having the home inspected by a licenced 3rd party.
Buyers will normally schedule both a termite inspection and a structural inspection. These inspections typically take place during the first ten days of the contract. The contract usually provides that if the buyer is not satisfied with the results of the inspection they can notify the seller of their dissatisfaction within the inspection period, terminate the contract and receive their deposit back.
If the property had certain features or the area is known for certain environmental conditions, a buyer may wish to schedule radon, well, asbestos, and soil testing. Once a buyer takers title to the property it is very difficult to obtain compensation for bad conditions that they later discover at the property. The time to learn about any defects with the property is before the closing. Buyer beware.
Dora Courchesne - Realtor
According to Dora Courchesne, Realtor with Real Living Realty Professionals: "When a home doesn’t appraise you can:
- Request that the appraiser look at other comps they may have missed (unlikely);
- Request that the seller reduce the purchase price to reflect the appraised value;
- Buyer can make up the difference with their ow cash (depending on their loan requirements) ; or
- Buyer may terminate the contract with all deposits returned to the buyer."
- Dora Courchesne - Realtor
- Phone: 413-218-7222
- Email: doracourchesne@gmail.com
- Web: https://www.wmasshomes.com/dora-courchesne/
Real Living Realty Professionals – Wilbraham
2040 Boston Road Suite 18 Wilbraham, MA 01095
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Terrae pontus scythiam obstabatque. Effervescere quicquam tepescunt tegi agitabilis mentes mutatas. Origo aliis nisi frigore tepescunt austro numero gentes ab. Ripis pluvialibus os. Coeperunt dicere inposuit litora illi. Aquae reparabat unus aer umentia mortales praeter flamina plagae! Terrenae recens moderantum auroram totidemque feras.
The Homestead Act in Massachusetts is a law that protects an individual or married couple's primary residence from the claims of most creditors in order to avoid a forced sale. The Act is codified in Massachusetts General Laws (MGL) Chapter 188. In residential real estate transactions, homeowners are encouraged to "get the homestead" which means, to have your attorney file the homestead declaration page with their deed at the registry of deeds at time of closing. The most beneficial way to take advantage of the homestead act is to pay the $35 it costs to record the homestead declaration page. Most Massachusetts lawyers will include this in the closing costs automatically. The homestead recording protects homes owned by individuals for up to $250,000 in equity from claims of third parties and protects homes of married couples for $500,000 in equity from claims of third parties. Elderly persons, age 62 or older and disabled persons may declare a Homestead under Section 2 of the Homestead Act. If the property is held in Trust, A Homestead Declaration under Section 3 must be filed by trustee for the benefit of the beneficiaries of the Trust who reside at the property.
Ask your attorney if you have any questions regarding the homestead! All real estate purchases are provided
with a homestead if closed by Attorney Nyles Courchesne at no additional cost.