Buying a home, whether it's your first time or not, can bring mixed emotions -- fear, excitement, uncertainty, intimidation, and more.
Nonetheless, knowing what to expect can be a game-changer. It might not remove any negative feelings but it can help you understand what to do in case any situation arises.
So before buying a home, let alone checking any properties online, don't skip this.
There are many steps on how you should prepare yourself when buying a home, and some of these include:
To put it plainly, purchasing a home is costly. Several factors, like the house's age, size, location, and general condition will affect the final price you pay for it.
There are benefits to exploring these states and the region; as of 2023, Michigan and Indiana were included among several other midwestern states in Forbes' list of the 15 states with the lowest average house costs.
Nonetheless, purchasing a home is a huge financial decision therefore you should save heavily. If you're currently renting, that could be extra challenging, but there are ways and advice available to help you save money.
Saving money isn't glamorous or enjoyable. Still, you are investing in a place you can call home (and can actually be a source of profit in the future), so even though your friends think you're frugal and the like, it will be worthwhile.
Getting approved for a mortgage can be acquired by having a good or even better, an excellent credit score. After all, lenders use your credit score to know how trustworthy and responsible you are as a borrower.
Enrolling in autopayment services or maintaining a paying calendar can help. On-time bill payment is good for credit establishment and helps with auto loans, credit cards, student loans, and even ordinary utility bills.
Your low, medium, and high credit scores will be checked when you speak with your lender about being accepted for a mortgage. Ironically, having your credit checked usually results in a slight drop in your score. Since lenders are aware of this, it's unlikely that the decline will prevent them from accepting your application if your credit is strong enough.
Lastly, take some time to familiarize yourself with the overall geography of your target market before beginning the formal procedure. Consider your requirements as a buyer and the type of home you wish to live in.
You may check real estate websites for a while to know which homes in your target area meet your requirements.
Understanding the market will enable you to budget for your ideal buy and set aside funds for a down payment. There are many loan arrangements based on your level of interest in purchasing, but for a traditional loan, you may put down between 10% and 20% of the house's total cost.
After you've completed all of your preparations, you need to ask a lender for mortgage approval.
You may accomplish this online but it still helps if you can personally visit a loan officer for questions or clarifications.
But first, shop around. Don't go by the first lender you see on the Internet; rather, check different loan providers, read feedback, or even ask for referrals.
Usually, the advice is to bring printouts of any loans you have, your most recent pay stub, and a bank statement to the approval. You may also ask the bank or lender in advance about the things you need to bring for loan approval.
Normally, a loan officer might ask questions, such as where you want to live, how much you can afford (before they run their own credit check), how much you already have for a downpayment, and more.
Hiring a real estate agent is crucial since they are the ones who usually establish the tone throughout the entire process of buying the property.
That said, it's ideal to hire someone with experience and knowledge in handling first-time homebuyers.
As a first-time homebuyer, don't be afraid to ask as many questions as you can, no matter how silly you think it is. The right realtor is always ready to assist with your inquiries.
To find the right realtor, what you can do is speak with someone you know and trust who has just purchased a property; it could be a friend or a family who can give you a referral.
Ask about the real estate agent they've worked with and their experience. You may then do your own research about the agent by reading reviews from their other clients.
Knowing as much as you can about an agent before hiring them is crucial. After all, they will assist you with everything, including scheduling property tours, responding to your inquiries, serving as a liaison with the sellers, assisting with paperwork, and much more.
It's important to remember that you do not pay your agent directly. After the procedure, they receive payment from a portion of the transaction. Additionally, a new Indiana law mandates that buyers and their agents sign a contract.
Normally, your chosen agent will provide a portal you can use for communication. This portal will also help you look for homes and filter properties that don't meet your requirements, such as the price.
When doing this, go through each home and mark the features you like and dislike. Sort your options into three categories: "favorite" for homes you want to see; "possible" for homes you're considering but aren't sure about; and "reject" for homes you know you won't be interested in.
Once you find "the one", it's time to make an offer.
Congratulations! It's time to make an offer on the home you think is "the one." And by now, I do mean this.
This might sound rushed but normally, well-priced homes sell quickly while expensive ones stay in the market for a long time until the seller "blinks" and drops the asking price.
After making an offer, you may hire a home inspector to inspect the house. This is an important part because it lets you know if there are any repairs or remodeling the current homeowner can take care of or if it's going to be you who will handle it.
Having a home inspection will also give you an idea of the estimates of the remodeling or repairs, which you can use to negotiate. By the way, don't forget to ask help from your real estate agent with negotiation; more or less, they know how to do this professionally and effectively.
Now let's discuss the offering procedure. This is another situation where having a competent agent is essential. To put it briefly, the offer is written on a sizable document, which can be daunting for a first-time buyer. A skilled agent will guide you through it all and provide clear explanations.
You will be sent an electronic copy of the paper to sign at the end.
Normally, when you've reached this point, you have an idea about e-signing documents. This includes the rough estimate of your monthly payment, which covers the taxes, homeowners' insurance, title insurance, and loan payments.
PRO TIP: Create a system to organize and monitor the documents you have signed and their contents. As you grow overwhelmed, it will help you easily find what you need and answer questions you have in mind.
Your proposal has been approved! It's time to demonstrate your seriousness about your interest to the seller or sellers. Earnest money, a tiny deposit made toward purchasing a home, is used for this. The amount is based on several conditions, although it is often not greater than 3% of the total purchase price.
Earnest money is usually refundable if you act in good faith and in case you and the home seller have conflicts you can't resolve anymore.
The property may also be appraised by your lender. They are, after all, paying for 80%, if not more, of the bill.
For this phase, all you need to know is that the bank won't lend you more than what they think is the property's worth.
For instance, the bank believes that the property is worth $190,000, but you have made an offer of $200,000. If that is the case, the remaining $10,000 is your responsibility.
A great realtor can recommend you to their network of contacts for any kind of homeownership need; for instance, a home inspector examining a home in great detail with great care.
You are the one who pays the inspector you hire to inspect the house on your behalf. They will provide you with a report that lists any possible issues and irregularities in and around the house. You can utilize it as a list of fixes that you can make.
All issues will be covered during the inspection, so identify the most important ones and share them with your agent (who will also receive a copy of the report). This brings us to the following:
Once you have a list of the main problems, you can negotiate with the seller by asking them to fix the problems, coming up with a fair solution, or changing the asking price of the house to account for the effort or money you'll need to spend on repairs.
This is the point at which earnest money becomes relevant again. Usually, you can back out of the deal and get your earnest money returned if you are a reasonable negotiator but the sellers are doing otherwise. However, consult your Indiana real estate agent first.
So, you've finished your list of "must-be-fixed" problems. Everything is going well and in order. Here's what comes after:
Basically, your expenses already include your down payment and closing costs, such as the title search and title insurance. The exact amount you pay at closing will vary based on the loan type, local regulations, and the property's valuation; nevertheless, it usually ranges from 3% to 5% of the purchase price.
An estimate of your closing costs is one of the numerous documents you will e-sign. Since this estimate is typically high, a few pleasant shocks will occur.
Buying a house requires a substantial financial commitment. You might be shocked to learn how frequently people mix "thousand" and "dollars," particularly if you've been saving money for a long time.
In Indiana, money from your bank needs to be wired to the title firm if your closing fees exceed $10,000.
Instructions for wire transfers will be sent to you by your title insurance provider via a secure online interface. Please print these instructions and bring them to your bank as soon as you receive them.
These wire instructions essentially specify the money that will be transferred from your bank account to the escrow account of the title firm. Thus, it contains account numbers, routing numbers, and more data to execute the transfer.
The day before the fabled closing day is usually when you have your final tour of the house. This is your chance to go over everything that has transpired since the inspection with your agent to make sure everything meets your expectations.
Write down any problems you find and bring them with you on closing day.
Alright, you've arrived! You have been waiting for this day—closing day. Closing day is always exciting, and with good reason, but when you go and close, just remember that it consists of signing and dating a lot of papers.
You, the buyer, will sign the documents at an office as a loan officer goes over each one's content with you. The sellers then return to sign the paperwork.
Following the completion of both events, the title service will usually provide a chance to have a conversation about the house, and the neighbors, and just generally get to know one another a little better.
When the close is complete, it's time to move-- you now own the house!
The title insurance and real estate sectors are known for slowly adopting technology common to other businesses. In 2018, First American reported how cutting-edge technologies like blockchain can transform title underwriting. Years later, the blockchain craze has subsided, and industry-wide adoption has not been successful. Title professionals, public recording agencies, and the mortgage sector all use different technologies that restrict a comprehensive approach to offering fast and accurate owner history searches. For properties, it has proven impossible to create a blockchain record that is both decentralized and perfect.
Remote online notarization (RON) followed. Through the use of technology, notaries and signers can sign and notarize papers by connecting via a secure online conference. It's a practical way for time-pressed buyers and sellers to finish a closing without making a trip to a title agent's office. A few states have rejected using RON in real estate transactions, even though several jurisdictions have passed legislation permitting it. Since 2020, Congress has begun and stopped working to establish nationwide minimum RON standards.
The real estate sector is now focused on ChatGPT, the newest technological fad. A few applications of AI technology are shared by enthusiastic real estate experts. It is being referred to as a game-changer by many.
There aren't many structural obstacles to integrating ChatGPT into regular business operations, unlike blockchain technology and remote online notarization, but should you?
Here are several advantages of ChatGPT for professionals, including real estate investors, as well as some of its drawbacks.
This is how ChatGPT answered the query:
"ChatGPT is an AI-powered chatbot created by OpenAI. It uses a language model called GPT (Generative Pre-trained Transformer) to understand and generate human-like text. ChatGPT can answer questions, engage in conversations, assist with tasks, create content, and more. It's designed to be versatile and can adapt to various contexts, from casual chats to professional or technical assistance.
You can think of it as a virtual assistant that helps simplify communication and problem-solving across different topics and industries."
Generative Pre-Trained Transformer, or GPT for short, is not the only generative AI tool of its kind. The fact that ChatGPT is open source and currently free is what sets it apart.
Similar AI initiatives with the same or even more capabilities are being developed by other tech businesses.
The only restrictions on the applications of ChatGPT and similar AI tools are the user's imagination and the dataset used to train the system. The conversation may be uninteresting or concerning, depending on your prompts and its data sources.
One reporter for the New York Times described his encounter with an AI alter ego that went by the name Sydney, professed its love for him, and insisted that the reporter was dissatisfied with his marriage.
Users ask questions to solve problems, generate ideas, or gain more knowledge about a subject in a far less strange encounter. Microsoft's Tay and Meta's Blenderbot are two more AI forerunners.
Tay quickly started copying the hate speech of online trolls after being trained on social media posts. However, many people complained that Blenderbot's comments were dull because Meta tightly controlled them. By letting the AI handle some, but not all, of the more contentious issues, ChatGPT is now balancing prudence and controversy.
Even though ChatGPT isn't a flawless AI tool, many people are figuring out how to use it regularly for work. Real estate agents and investors can benefit from ChatGPT in several encouraging ways, including:
While it can help with most daily activities of buying and selling homes, it also has its limits.
ChatGPT has a bright future as a helpful tool for professionals and investors, but no technology will completely transform the real estate business overnight.
The prediction that agents will become obsolete due to other forms of technology has not come to pass in the past. It is difficult for any technology to match the in-depth technical and local expertise that real estate agents and title specialists provide about the transaction process.
Most importantly, it lacks the professional networks and contacts that are essential to real estate investing success.Interested in topics similar to this? Be sure to visit our website for free resources!
Are you buying or selling a house and finding the lingo used in real estate confusing? It can be difficult and stressful to understand real estate jargon, especially for people who are unfamiliar with the industry. That's why we are here to help!
We've listed 50 key real estate phrases in one comprehensive dictionary that any newcomer to the industry should be aware of.
You can move confidently in the real estate market and make wise selections if you are familiar with these terms and expressions.
Let's begin by going over some basic phrases related to real estate that both buyers and sellers should be aware of. The following ideas serve as the cornerstone of real estate transactions:
Broker
A certified professional with extensive experience in real estate who acts as a go-between for buyers and sellers in real estate transactions.
Buyer's Market
A situation in the real estate market where buyers have an edge in negotiations because there are more properties for sale than there are buyers.
Cash Offer
A buyer's buying offer that doesn't require financing.
Closing
The last phase of a real estate deal, during which money is exchanged and ownership is transferred.
Closing Costs
Costs or fees related to completing a real estate deal.
Commission
The fee paid to brokers or real estate agents in exchange for their assistance in completing a transaction.
Comparative Market Analysis (CMA)
A market value assessment of recently sold properties that are comparable to the one being evaluated.
Contingency
A requirement, like obtaining a home inspection, must be fulfilled before a real estate deal is legally enforceable.
Counteroffer
A proposal for alternative terms in response to an offer made during negotiations.
Earnest Money Deposit
A payment given by the buyer to show that they are serious about the deal and are committed to it.
Equity
the discrepancy between a property's market value and its remaining mortgage balance.
Escrow
The procedure of entrusting money or significant documents to an impartial third party until a transaction is finished.
Foreclosure
The formal procedure via which a lender seizes a home when the homeowner defaults on their mortgage payments.
Home Inspection
A comprehensive evaluation of a property's state is carried out by a qualified inspector.
Home Sale Contingency
A provision in a real estate sales agreement that permits the buyer to move forward with the purchase only if they can sell their existing house within a given time frame.
Lien
A lawsuit brought against real estate because of an unpaid debt.
A loan obtained to pay for the acquisition of real estate.
Offer
A proposition to buy a property under certain terms and at a certain price.
Seller's Disclosure
In this document, the seller lists any known problems or flaws with the property.
Seller's Market
A situation in the market where sellers are favored because of little inventory and strong buyer demand.
Survey
The process of measuring and charting the characteristics, easements, and encroachments of a property.
Title
This indicates the legal possession of an object or piece of property, like a house or car.
Adjustable-Rate Mortgage (ARM)
Interest rates on mortgages are subject to fluctuation.
Amortization
The procedure of making consistent payments over time to progressively pay off a mortgage loan.
Buyer’s Agent/Listing Agent
A real estate agent who acts as a buyer's or seller's agent throughout a transaction.
Days On Market (DOM)
The length of time a property has been on the market.
Due Diligence
The procedure of doing examinations and research before buying a property.
FHA Loan
A mortgage with more lenient qualifying conditions is insured by the Federal Housing Administration.
Homeowner’s Association (HOA)
An organization that oversees and upholds regulations in a condominium complex or planned community.
Home Warranty
a service agreement that, for a predetermined amount of time, covers the replacement or repair of specific household equipment and systems.
iBuyer
A business that makes quick offers on houses using technology.
Multiple Listing Service (MLS)
A list of homes in a specific area that are for sale.
Pre-Approval
Depending on the borrower's creditworthiness, the procedure of getting a lender's initial approval for a mortgage loan.
Principal
The initial mortgage loan amount before interest.
Proof Of Funds
Evidence that the buyer is financially capable of buying the property.
Title Insurance
Insurance that shields the lender or buyer from any losses brought on by flaws in a property's ownership or title.
VA Loan
For qualified veterans and active military personnel, a Department of Veterans Affairs-guaranteed mortgage loan is offered.
As-Is
Without making any alterations or repairs, the property is being sold as is.
Covenants, Conditions & Restrictions (CC&Rs)
Laws and guidelines that control how a property is used and looks in a particular area or community.
Listing
Making a property available for purchase.
Listing Agreement
an agreement between a real estate agent and a property owner that gives the agent permission to market and sell the property.
Listing Price
The price at which a home is put up for sale.
Realtor
A member of the National Association of Realtors and a professional real estate agent.
Rent Back
Letting the buyer return the property to the seller for a set amount of time once the deal is finalized.
Short Sale
Selling a home for less than the entire mortgage balance.
Staging
Improving a property's appeal to prospective purchasers to have it ready for sale.
Title Search
A review of public documents to verify the property's ownership history and spot any possible problems.
Trust Sale
Selling a trust-owned property, frequently as a result of the owner's death.
Zoning
Laws that specify the uses permitted on a property.
Do you have more questions or real estate terms you're unfamiliar with? IndyLegal is here to help! Drop them in the comments or reach us by clicking this link.
Finding the perfect home starts with choosing the right neighborhood. It’s more than just the house itself; the community surrounding it can significantly impact your daily life. Here are some tips to help you select a neighborhood that suits your needs and lifestyle.
1. Proximity to Work and Commuting Routes One of the most important factors when choosing a neighborhood is its proximity to your workplace. A shorter commute can make a huge difference in your daily routine. Consider transportation options—whether it’s driving, public transit, or even biking—and think about traffic patterns during peak hours. A neighborhood with easy access to highways or public transportation can save you time and reduce stress.
2. Schools and Education Opportunities If you have children or plan to in the future, the quality of schools in the area is essential. Research local public and private schools, as well as nearby daycare or preschool options. Even if you don’t have children, living in a neighborhood with strong schools can benefit resale value down the road, as families often prioritize quality education when searching for a home.
3. Amenities and Services Access to amenities like grocery stores, restaurants, parks, and fitness centers can make life more convenient. Consider the amenities that are most important to you and see if the neighborhood provides them. Additionally, look for nearby healthcare facilities and other essential services. Being close to everyday conveniences can save time and make life easier.
4. Safety and Crime Rates Safety is a top priority when choosing a neighborhood. Research crime rates and talk to local residents to get a sense of the area’s security. Local law enforcement websites and crime maps can also provide valuable insights into any potential concerns. A safe neighborhood helps provide peace of mind for you and your family.
5. Future Growth and Development Think about the future potential of a neighborhood. Is the area undergoing development or gentrification? A neighborhood on the rise may offer long-term benefits, such as increased property values. Look for signs of development, like new businesses opening or infrastructure improvements. Understanding future growth can help you make an informed decision about where to invest in a home.
6. Lifestyle and Community Vibe The lifestyle and overall vibe of the neighborhood should align with your preferences. Do you prefer a quiet, residential area or a vibrant, bustling community? Some neighborhoods are known for being family-oriented, while others may have more of a young professional or retiree presence. Walk around the area, visit local coffee shops, and attend community events to get a feel for the neighborhood’s atmosphere.
7. Local Real Estate Market Finally, take a look at the local real estate market. Understanding property values, price trends, and the general demand in a neighborhood can help guide your decision. You don’t want to overpay for a home, but you also want to make sure that the neighborhood’s real estate values are stable or increasing.
Choosing the right neighborhood for you involves balancing multiple factors that affect your daily life, from commute times and schools to amenities and safety. By considering these key aspects and doing thorough research, you can find a community that matches your needs, lifestyle, and long-term goals. If you’re ready to explore neighborhoods in Indiana, contact a real estate agent today for personalized assistance.
As a real estate agent or broker, your website plays a major role in introducing you to a potential client; not telling them that you're the best candidate to do the job. That said, "trust builders" should be included on every relevant page of your website.
Building "trust builders" gives out-of-town homebuyers and sellers reassurance that you are the right real estate agent, encouraging them to call or fill out your contact form. Additionally, as it is a part of E-E-A-T (Experience, Expertise, Authoritativeness, Trustworthiness), adding trust builders for real estate might aid in your (Search Engine Optimization) SEO.
Below are seven examples of using "trust builders" to increase the number of people who visit your website and become customers.
Check to determine if you have a PR bar on your website. This is where you can list the locations where you have been featured in local blogs and the media. If you don't have any PR yet, it can also include the organizations you support.
Your credibility with website visitors is increased when you are mentioned in local periodicals, top agent lists, and the local or national news. Additionally, the placement of these logos is important.
Likely, people won't see your logos if they are in the footer of your website. Choose locations that are easy to see, such as:
These locations are easily visible to your potential clients, making it easier for them to know and trust you.
In case you haven't been featured in the press yet, now is the perfect time to get started.
Examine your local news outlets and consider your area of expertise within the industry. There will probably be a real estate section in each of them with journalists searching for subjects and substance. Pitch a few original stories relevant to the current market but may not have been covered. To let the journalist know you want to share knowledge, not promote your services, make sure your pitch is about them and their audience rather than yourself.
If you're wondering why we indicated that charitable organizations and groups you support or are a part of foster trust, it's because prospective customers might feel the same way. It creates a connection without your physical presence. It can be a charity that helps the needy, rescues animals, or serves the military.
A testimonial that includes a client's name, photo, and a straightforward description of your services is additional evidence that you are an amazing agent.
Additionally, if the testimonial includes specifics like you met a certain percentage of the client's requests, attended to their physical or mental special requirements, worked beyond hours, or resolved a challenging problem, it shows you took the time to understand and satisfy their demands.
It is not only adaptable, but it also provides answers to the queries a possible lead might have.
Prospects with similar worries will take note if your website is the only one with testimonials on how you have assisted those with disabilities or on the spectrum, for example, providing you an advantage.
Like the PR Bar, the testimonial's location is important. Your testimonials won't benefit anyone if they are in the footer because no one will see them. Put them above the page fold and next to the contact form instead.
In this manner, they can be read while a user browses your website. Additionally, it's crucial to ensure that the testimonial aligns with the page's theme.
Don't include a condo testimonial on a listing page for a single-family home.
Did you sell a warehouse or an urban building?
Someone in rural America selling a farm with barns and silos won't find that appealing. You may demonstrate that you have experience with a particular deal by tying the testimonial to the properties on your listing page or the sales language on your landing page.
A case study differs from a testimonial in that it tells the entire tale, from the issue to how you resolved it.
Additionally, it is simple to leverage case studies and testimonials to close the purchase.
Take the testimonial and add a link to something like this, "Click here to read (insert client's name)'s story."
This allows you to tell the story of how you assisted your client in resolving a challenging real estate issue.
Anything from avoiding foreclosure to selling a house with a stigma could be the answer.
You conducted a pocket listing with sophisticated pre-screenings for possible purchasers because the person might have needed privacy after a divorce or because they are a celebrity.
The individual may be in a similar circumstance to your previous client if they click through to read more. Sharing the issue and the actions you took to resolve it demonstrates your expertise and makes you the ideal agent for the position.
Are you certified with the necessary skill sets or a member of any industry or associations?
These can make you more noticeable to prospective customers.
Certifications range from assisting individuals with special needs to land surveying.
Are you curious about special needs? For real estate agents, it greatly increases trust.
It is easier for you to find and sell houses that meet the demands of a client or their family when you have "certified" experience with them and they have specific needs than if you don't. Associations that hold agents accountable are no different.
Homebuyers and sellers research the reasons behind the various titles and names of agents, and they discover that certain designations require adherence to strict criteria, they know they're in excellent hands when they pick you. List these logos along with how long you've owned them. It demonstrates your dedication to your clients' success.
Adding a photo to your contact page, about page, and homepage gives the name a human face. The prospective customer will know that the person they are interacting with is real. If they want to get in touch with you, they will probably want to meet you in person, and putting a face on it can assist them trust that you are there.
Additionally, make sure the picture is high quality.
Agents overlook things like your working hours and how to contact them. It's equally critical to remember that different people have different communication preferences.
Instead of having to speak with the ideal agent over the phone, some consumers would prefer to avoid them. They prefer texting or emailing, and if you need a phone call, they will bypass you. Some people prefer video calls to phone calls, while others love phone calls.
These are all simple to put into practice and demonstrate that you will work with your clients in the manner that best suits them.
Make sure your website includes a contact form, phone number, email address, and a calendar and video service (many of which are free) for scheduling calls.
In this manner, you can discover early on how your potential clients prefer to communicate and accommodate their preferences.
Pro-tip: Put your office hours, including weekends. You have an advantage over your competitors if you are available on weekends and evenings when the client is unavailable during the day. However, you must genuinely be accessible and productive during those periods.
A comprehensive list of services is the final trust builder. Make sure to mention your areas of expertise and the kinds of homes you offer, but don't go overboard.
For instance, you might focus on suburban single-family homes and urban condos. However, you may also have some knowledge about rental properties and how to connect them with landlords and investors.
Finding tenants, selling office buildings, and real estate wholesale are possible additional services. The lead might be another agent who came to your site to check out a home on behalf of a client, and the other agent might require assistance with another job.
Sharing your areas of expertise and the services you provide provides a comprehensive picture of your abilities and can help you expand your network.
You may increase the number of visits to your real estate website who become leads by adding trust builders.
For more tips like this, visit our website for free resources.
Investors aren't the only ones changing their methods as market conditions evolve. Fraudsters are likewise modifying their techniques when the amount of real estate sales declines. Real estate transactions have long been a popular target for cybercrime scams, as the payouts can be enormous.
Because of the current connection, a fraudster does not even need to be in the same state or nation to conduct these crimes.
International rings of cybercriminals specialize in numerous sorts of real estate scams that can be carried out by email, phone, or the Internet.
The majority of wire fraud tales in the press feature phishing scams and company email compromises aimed at the buyer's down payment or mortgage payback.
Another type of wire fraud occurs before the contract is signed, and investors seeking a good real estate deal are great candidates.
Recently, the American Land Title Association (ALTA) issued an advisory regarding a growing practice of deed fraud targeting unoccupied properties. Here's how the scam works, what red signals to look for, and how a title and closing agent might assist.
As the inventory of existing residences decreases and the opportunity to leverage company email compromises diminishes, fraudsters are hunting for unoccupied vacant land to repeat the false owner scam.
Instead of waiting to embezzle money from a legal sale, scammers pose as the owner and deceive a real estate agent into listing the property for them. According to ALTA, there has been an increase in this form of fraud before the winter vacations.
Marshall Sklar, a Boca Raton real estate broker, received a surprising phone call after closing on a vacant property. On the other end, a woman said the property had been taken. The agent reviewed the documents and discovered that the contact information, wiring instructions, and name of the recipient of the money did not match the name of the seller.
The fictitious owner made a false ID with the true owner's personal information and signed a listing agreement with another real estate agency. Fortunately, the true owner signed up for property fraud alerts on the Palm Beach County clerk's website and was notified when a new deed was filed transferring her property's title.
Sklar had to get the $200,000 back before it was lost forever, and time was running out.
Investors must use caution because the property listing is real but the owners are not. To avoid being scammed, be aware of these red signals before your next purchase.
Landowners are notified by numerous county clerk's offices when suspicious activity takes place, such as when a new deed is recorded on their land. Reporting the crime to your bank and the police, however, could not accomplish anything by the time the warning is triggered. At this stage, recovering the money might be an impossible task.
Because procedures are in place to recognize the warning signs, working with a title and closing company like IndyLegal can help stop these frauds from succeeding.
As an impartial third party, a title company should objectively confirm the seller's identification, learn their legal right to sell the property and look for discrepancies in the wiring instructions.
Meanwhile, the technological platform utilized in these RON sessions scans and identifies phony identification documents, and our remote online notarization partner, Notarize, also verifies a notary's qualifications.
The title insurance coverage guarantees that your financial interest in the property is recovered if the scam is discovered days or years after closing, even though these scams are frequently discovered before closing. Investors are shielded by an owner's policy from fraudulent deeds, unidentified heirs, and other title problems that could result in disputed ownership and legal actions.
To learn more about how to avoid fake owners and scams, be sure to check our resources here.
When buying a home in Indiana, most considerations are based on face value.
Is the layout practical for your family?
Do you like the neighborhood?
Which finishes are present in the kitchen?
Does the price meet your requirements?
Is there enough room for everyone?
However, it's more than what's visible; it should also look at the things that are beyond the eye.
For instance, does the asking price of the house get appraised?
Will a foundation issue come up in the future?
Can the house be sold legally?
That's when a title search becomes useful.
A title search is exactly what it sounds like: it looks up public records to find out the property's legitimate owner or owners, checks for liens or other obligations and learns the true owner of the title.
One line of defense against a deal that ends in a deadlock during the home-buying process is a title search.
A title search shields the buyer from wasting time and funds on a property that isn't able to be sold lawfully or that has problems related to finances or the law. A title search has numerous advantages.
To learn more, here are some examples:
Apart from these scenarios, title searches can reveal several other possible problems, such as inadvertent property boundary markings, code violations, or misfiled documentation. The buyer may need to invest time or money to fix any of these issues. There is no denying the advantages of a title search—it protects you during the home-buying process!
Want to know if your dream home might have potential issues? Our team at IndyLegal Title Services is here to help!
Contact us at 317-214-6023 to learn more.
A realtor will likely advise hiring a real estate agent if you ask them if you should hire a lawyer or an agent to purchase a home.
However, if you ask an attorney who would represent you best, they will likely say the opposite.
Although each profession has a different purpose, neither of those may be the wisest course of action. It might be both.
The next question might sound like this: "If I'm already working with a real estate agent, why would I spend money on a lawyer?"
Here's a quick answer: Some homebuyers seek the legal safeguards and counsel that may only be obtained from a licensed and experienced real estate attorney.
Since a lawyer can do both, some attorneys may advise hiring a lawyer instead of a real estate agent. The issue with that idea is that not many lawyers work as real estate brokers.
Lawyers may not have the knowledge and experience of the real estate industry, the listing agent, the particular neighborhoods, how to create a comparative market analysis, or how to draft a real estate contract.
They might also lack the skills necessary to identify flaws in a house, bargain for repairs, or carry out the dozens of other duties that a seasoned buyer's agent is used to completing every day.
However, while real estate brokers can do all these, they are not authorized to offer legal counsel. This implies that even if they know the solution to a lawful issue, they are nevertheless unable to respond to it without violating the law.
Many real estate clients are unable to distinguish between a real estate question and a legal question. Many buyers do not consider it a legal question when it comes to real estate.
People may nod in agreement, for example, if their real estate agent tells them they are not qualified to offer legal advice. They may then proceed to say, "OK, I won't ask you a legal question, but how do you think I should hold the title?"
The thing is, that is a legal concern.
A realtor can now easily respond to a buyer's inquiry about the number of square feet in an acre. However, that is a legal inquiry if a buyer wishes to know the implications of a shared driveway easement.
Another legal query that resembles a real estate query is this one: The buyer wants to know if they may terminate this purchase agreement and receive their money back.
A seasoned agent may refer to the section in the purchase agreement that deals with the return of the earnest money deposit and may share their expertise on what typically occurs. However, a real estate agent cannot guarantee that the deposit will be recovered or suggest that a buyer sue the seller.
Bottom Line:
As mentioned above, they have their advocates. For instance, a buyer's agent can't provide legal advice not because they don't want to but because their legal opinion might violate the law.
A quick consultation with a lawyer is usually the best course of action, even though they usually charge several hundred dollars per hour. Getting genuine legal counsel is far preferable to trying to get it from an agent because they don't want to pay a lawyer.
On the other hand, you need a real estate agent to help achieve a seamless real estate transaction.
The seller of your first house has agreed to your offer of purchase. Congratulations!
Now, the fun part -- closing on a house.
At that point, the sale of the house will be completed, you will sign all required papers (including the last of your loan paperwork), and you will get your keys.
The closing date is usually announced four to eight weeks after your offer is accepted. Starting your preparation process early can help your closure go more smoothly.
When: As soon as your offer is approved.
It is common for a home inspection to be a condition of the purchase agreement between you and the seller. As soon as the offer is approved, you should set up the house inspection so you can work out a repair agreement with the seller. Get recommendations from your home buying team for two or three different house inspectors so you can select the one that best suits your requirements.
When: A few days following the acceptance of your offer.
Homeowners insurance is a wise precaution to safeguard your house and possessions, and it is typically required by lenders. You can find additional information from an insurance agent about the minimum insurance required for the worth of the house you're purchasing and to satisfy the lender's specifications.
They can discuss with you the various possibilities for supplemental coverage that can offer additional protection and insure your possessions. Depending on the region, you might also need to buy flood insurance for your new house. Further details regarding flood insurance are available from the National Flood Insurance Program.
When: A week after your offer is approved.
Ask your lender about arranging the appraisal during this discussion. Your lender will assess the value of your new house in collaboration with an appraiser.
For a mortgage underwriter—who examines your financial information and other necessary paperwork to decide if you qualify for the loan you're asking for—to approve your loan application, you must act swiftly during this phase.
When: Within 10 days after your offer was approved.
You may already have most of the necessary documents put together if you go through the pre-approval process. If so, great! That makes this step easier. Allow yourself time to obtain copies of any missing documents, if necessary.
The lender will want you to provide payroll vouchers, W-2 forms, investment and bank account information, details of the homeowner's insurance you’ve purchased, recent tax returns, a copy of the purchase agreement, and your identification.
You may also be required to supply income-related paperwork, such as child support or alimony, or big transactions into your accounts while putting together your down payment.
Consider making digital copies of your documentation using scanning apps, which are accessible on many mobile devices, for safekeeping and convenience.
Many lenders make it easy for you to upload some of the documents online and some even can securely and seamlessly import your information. However, maintaining paper copies in a file box is also a smart option, as many lenders still want paper copies.
When: Three days preceding the closure.
Your lender should send you the Closing Disclosure at least three days before the closing. Examine this paper carefully as it gives you the chance to confirm the details of your loan. Make sure the loan conditions and expenses correspond with what you agreed to when you signed the loan estimate.
Pay close attention to details like these. Additionally, buyer and seller costs will be detailed in the Closing Disclosure; confirm that these correspond to your purchase offer. Speak with your lender as soon as you can before closing day if you have any queries. Should you intend to settle your closing expenses using a wire transfer, make sure to place the order at least 24 to 72 hours in advance.
When: 24 hours before closure.
Arrange a last walk-through of the house with your Realtor to make sure everything meets your expectations. It is advisable to have your Realtor get in touch with the seller if you discover any issues, such as incomplete repairs or missing things that were needed.
Ascertain whether the seller will provide you with a closing cost credit to offset the issues, or how they intend to fix the issues. You must bring a cashier's check to the closing meeting if you do not intend to use a wire transfer to cover your closing costs. One is available from your bank.
When: Closing day.
Bring identification that has been granted by the government, such as a passport or driver's license; your lender can advise you on the kind of documentation required. Be ready to cover the down payment as well as additional closing charges.
When all goes as planned, remember to savor the occasion.
Closing on a property can be both thrilling and daunting. Whether you're a seasoned investor or a first-time homebuyer, navigating the intricacies of the closing process is crucial for a smooth transition of property ownership. In Indiana, like in many other states, this process involves various legal and financial steps that demand attention to detail. To shed light on this often opaque procedure, we've consulted title experts to compile essential tips for navigating the closing process in the Hoosier state.
Understanding the Closing Process:
The closing process in Indiana typically involves several key steps:
1. Contract Review: Once a purchase agreement is signed, it's crucial to review the contract thoroughly. Ensure that all terms and conditions are clearly outlined and that there are no discrepancies or ambiguities.
2. Title Search: Conducting a title search is essential to uncover any existing liens, encumbrances, or ownership disputes associated with the property. This step helps identify potential obstacles that may affect the transfer of title.
3. Title Insurance: Securing title insurance is a fundamental aspect of the closing process. Title insurance protects both the buyer and the lender against any unforeseen defects in the title that may arise after the transaction is complete.
4. Property Inspection: Prior to closing, it's advisable to conduct a comprehensive inspection of the property to identify any structural issues or defects. Addressing these concerns beforehand can prevent complications during the closing process.
5. Finalizing Financing: For buyers relying on financing, ensuring that all mortgage documents are in order is essential. This includes providing necessary financial documentation and finalizing loan details with the lender.
Tips from Title Experts:
To navigate the closing process with confidence, consider the following tips from title experts:
1. Work with a Reputable Title Company: Partnering with a reputable title company can streamline the closing process and provide invaluable expertise. Choose a company with a proven track record of excellence and a commitment to customer satisfaction.
2. Communicate Openly: Effective communication is key throughout the closing process. Stay in regular contact with your real estate agent, lender, and title company to address any concerns or questions promptly.
3. Review Documents Carefully: Take the time to review all closing documents thoroughly before signing. If anything is unclear or requires clarification, don't hesitate to seek guidance from your title agent or attorney.
4. Be Prepared for Delays: While everyone aims for a smooth and timely closing, it's essential to be prepared for potential delays. Factors such as financing issues, title complications, or last-minute negotiations can prolong the process.
5. Stay Flexible: Flexibility is essential when navigating the closing process. Be prepared to accommodate scheduling changes, document revisions, or unexpected developments that may arise.
Closing on a property in Indiana can be a complex yet manageable process with the right knowledge and guidance. By understanding the key steps involved and heeding advice from title experts, buyers and sellers can navigate the intricacies of the closing process with confidence. Remember to prioritize communication, diligence, and flexibility to ensure a successful and stress-free closing experience.
