Home Transaction Guide
Maryland, Virginia & Washington, DC
Cover
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Part of the TRG Family of Companies masettlement.com
Who is Mid-Atlantic Settlement Services?
Buying or Selling a Home
Mid-Atlantic Settlement Services Company is owned and operated by Title Resource Group (TRG). TRG is a driving force in the title and settlement services industry. We are national in scope, but locally staffed, with a wealth of experience in settlement services. We operate in 43 states and provide closing services in all 50. TRG also operate the nation’s 6th largest title insurance underwriter, Title Resources Guaranty Company. Mid-Atlantic Settlement Services operates exclusively in the Maryland, Virginia, Northern Virginia and Washington D.C. We are one of the largest settlement providers in the area handling thousands of transactions each year. Our team of attorneys, processors and closers are ready to serve your needs.
Buying: ■ You will receive instant e-mail updates on homes matching your search criteria ■ Access to one of the top mortgage companies in the nation ■ A comparative Market Analysis so you know you are paying the right price for your dream home. ■ After settlement you ownership interests will be protected
What is Title Insurance?
for years to come.
Title Insurance is a form of indemnity insurance which insures against financial loss from defects in title to real property and from the invalidity or unenforceability of mortgage liens. It is meant to protect an owner’s or a lender’s financial interest in real property against loss due to title defects, liens or other matters. It will defend against a lawsuit attacking the title as it is insured, or reimburse the insured for the actual monetary loss incurred, up to the dollar amount of insurance provided by the policy. Typically the real property interests insured are fee simple ownership or a mortgage. However, title insurance can be purchased to insure any interest in real property,
Selling: ■ Your home will be protected by a home inspection plan at NO CHARGE to you ■ A Home Loan expert will verify the prospective buyer is qualified to purchase your home
including an easement, lease or life estate. ■ You will receive weekly updates on marketing the results There are two types of policies—owner and lender. Just as lenders require fire insurance and
for the sale of your home
other types of insurance coverage to protect their investment, nearly all institutional lenders also require title insurance [a loan policy] to protect their interest in the collateral of loans secured
■ Your home will be featured on more than 400 websites
by real estate. Some mortgage lenders, especially non-institutional lenders, may not require
■ You will have 24/7 online access to all of your paperwork
title insurance. Buyers purchasing properties for cash or with a mortgage lender often want title
including the contract involved with the sale of your home
insurance [an owner policy] as well. A loan policy provides no coverage or benefit for the buyer/ owner and so the decision to purchase an owner policy is independent of the lender’s decision to require a loan policy.
■ The security of knowing the home of your sale was properly recorded when you use Mid Atlantic Settlement Services.
Call 703-361-9161 today for a private consultation including a financial evaluation.
®
Making Buying and Selling a Home EASY
Getting Ready Before you begin selling or even looking for the home of your dreams, there are a few things you should do first. Advanced preparation will help make the home-buying and selling process smoother and much more efficient.
Table of Contents
Organizing your Finances
Buying or Selling a Home with a Realtor...................................................3
• See a mortgage provider to get pre-qualified
Getting Ready......................................................................................................5
• Get a free credit report at freecreditreport.com
Benefits of Working with a Real Estate Professional............................5
• Make a household budget and figure out where money is coming from and where it is going
(income vs. bills/debt) Buyer’s Helpful Hints..................................................................................................... 6 Finding the Perfect Home Lender Pre-qualification..........................7 Seller’s Helpful Hints.................................................................................................... 8 Negotiation....................................................................................................... 9
• Begin to gather items such as: last three years of income tax returns, bank statements for the last three months,
current copies of pay stubs, records of any past derogatory credit history that has since been paid off, and records of any supplemental income you may have. If you are self-employed, you will need all business records and income tax returns for the last three years • If you have been divorced or filed for bankruptcy, make copies of the complete settlements • Pay off minor debts if possible and do not incur new debt
Setting the Price............................................................................................10 Before you Sell – Tips and Checklists................................................11-12
Financial Incentives for Certain Professions Many lenders and Realtors offer special programs for specific service industries and
The Home Buying Process............................................................................ 13
professionals such as teachers, police and firemen, doctors, military etc. Be sure to check
Unilateral Notice of Deposit Agreement.................................................. 15
and see if you qualify for this type of loan during your pre-qualification process.
Water Quality Addendum........................................................................ 16–17 Maryland Residential Contract of Sale..............................................18–28 Virginia Residential Contract of Sale.................................................29–36
Benefits of Working with a Real Estate Professional
Understanding the Settlement Statement (HUD-1).....................38–43
• They can offer solid advice on what you can afford and what your house is worth
House Comparison Chart...................................................................... 44–45
• They have expert negotiating skills to insure you get the best price and/or do not overpay for you property
Repair and Cleaning Checklist............................................................ 46–48 Moving Tips..................................................................................................49–51 Glossary........................................................................................................52–56
• They can use the MLS and numerous other sources to find information on properties listed for sale that might
suit your needs • They can organize appointments with home sellers so you can view homes that you are interested in • They are knowledgeable about the paperwork you will need to fill out when making an offer • They will help in the arrangement of financing and are skilled negotiators
4
5
Buyer’s Helpful Hints Please provide the title company with the following:
Finding the Perfect Home Lender Pre-qualifications Most homebuyers will need a loan in order to purchase a house. It is crutial to go ahead and get pre-qualified with your lender before you actually start looking at homes for two reasons.
❑
Homeowners Insurance
Prior to closing, please provide us with your choice of homeowners insurance and your insurance agent’s name and telephone phone number.
❑
Certified Funds
All transactions require certified funds.
❑
Wired Funds
If you wish to wire your funds needed for closing from your account directly to Mid-Atlantic Settlement Services escrow account, please inform us prior to closing so that we may assist you in making the arrangements.
❑
Identification
Don’t forget to bring your driver’s license and other form of official picture ID to closing. Two forms of ID are required.
❑
Reviewing the Documents
If you wish to examine your loan documents prior to closing, please request that the mortgage company provide the documents to the title company at least one day prior to closing so that we can process the closing documents and provide you with copies for your review in a timely manner.
First, your lender will help you determine your price range of homes you should be shopping for. Second, it is common and customary to submit a preapproval letter with your offer on a home. During the pre-approval process, the lender will verify credit worthiness and determine the price range of houses you are qualified to purchase. There are numerous benefits to starting an application at this time while you are deciding what to buy.
Benefits of Pre-qualification Peace of Mind
If you are pre-approved, that’s just one less thing you have to worry about while you’re looking for your new home. Save Time
Once you are pre-approved, you will know what you can afford so you won’t waste any time looking at homes that you aren’t qualified for. Negotiating Power
Once you find the home you want and make an offer, being pre-approved will make your offer have more impact than others, and you will be more likely to get the terms and price you desire. Advanced Problem Solving
Avoiding Common Closing Delays
Often, buyers will need a little work to get their loan approved. The best time to get these problems taken care of is prior to making an offer on a home.
• All bills for inspections, repairs or other items to be paid at closing must be provided to us prior to closing. • If you will not be present at closing to sign documents and you intend to use a power of attorney, you must
provide the original power of attorney to your closing officer at Mid-Atlantic Settlement Services prior to closing for approval and recording of the document. (The lender will also need to approve the power of attorney). On the day of closing, we’ll need a contact number in order to reach you to verify that you are alive and well and have not revoked the power of attorney.
Once you’re pre-qualified, or at least have the pre-qualification process started, it’s time to start shopping for your new home!
• Don’t forget to bring the termite certificate to closing (if applicable).
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Seller’s Helpful Hints Please provide the title company with the following:
Negotiation Your real estate professional is an expert at negotiation. He/she will work closely with you to net the most amount of money possible.
❑
Existing Lienholders(s)
As soon as possible, please provide Mid-Atlantic Settlement Services closing officer with the name of your existing lienholders(s), along with their address and phone number. We will also need the loan numbers.
❑
Social Security Numbers
We will need the Social Security number of all owners of the property for tax reporting and because the lender will require Social Security numbers for payoff information.
❑
Identification
Home Inspections Once a buyer has decided to make an offer on your home, it will usually be contingent upon a professional inspection of the entire property. The inspector will check and make sure all of the home’s general systems are working properly and report any items that need to be repaired. Your real estate professional will help negotiate items the buyer may request to be repaired. If you have an AHS Home Warranty on your home you may be able to use it for some repairs.
Don’t forget to bring your driver’s license or other form of official picture ID to the closing.
❑
Wiring Information
Before You Sell — Tips and Checklists
Upon funding of the transaction, we will be glad to wire your proceeds into your account. Please provide us with your wiring information if you choose to have your funds wired.
Advanced preparation is the key to making the selling process smoother and more efficient. Before you put your home on the market, there are a few steps you should take to make sure it is ready to be seen by prospective buyers.
Avoid Common Closing Delays • All bills for inspections, repair or other items to be paid at closing must be provided to us prior to closing. • Don’t forget to bring the termite certificate to closing (if applicable).
8
Perform a Self-Inspection
❑
W alk through the home and ask yourself, “Would I buy this home?”
❑
T ry to remove any emotion and sentimentality you may have for the home and look at it objectively.
❑
Make a list of things you’d like to repair or change. Consult your real estate agent for contractor names and numbers.
❑
on’t make major changes that will cost more to do than you will get for them in return. D Consult your real estate agent before making any major changes to the home.
❑
P rioritize the list in relation to when the house is going on the market. (Projects that require numerous resources such as contractors, remodellers, etc., should be first.)
❑
P repare a timetable to have all repairs/changes made and stick to it.
9
Setting the Price
Showing Your Home
Now that your house is ready to be put on the market, it is vital that it is priced so that it sells
It’s true what they say about first impressions; they really are important. Now that your real estate
at, or close to, your asking price and so that it sells quickly. Houses are a market commodity
professional is actively marketing your home and will soon be bringing potential buyers to view
that should therefore be priced at market value. A common definition of market value is
it, the home should be ready to show at all times. In addition to the steps you’ve already taken to
“What a ready, willing buyer will pay, at a price a seller will accept. “ In order to determine the
get your home ready to be put on the market, here are some extra tips to help ensure that your
market value of your home, your real estate professional will do a CMA, or Competitive Market
home makes the best possible impression at showing.
Analysis, of your home. The CMA compares your home to other houses in the area in terms of square footage, amenities, condition and relative age. You may want to provide your real estate professional with a list of items about the property that you feel are major advantages.
Here are a Few Other Things to Keep in Mind when Setting the Price • The asking price is not the same as an appraisal price. An appraisal value is what the lender will loan someone
who wants to buy your home. The appraised value is a professional opinion of value at a moment in time. • The asking price may not reflect the market value of the home. • Asking or list price is not permanent. It may change and you should be prepared for negotiation.
General Tips for Showing Your Home
❑
M ake the home welcoming and inviting by keeping it clean and tidy.
❑
E veryone in the home should make their bed every morning.
❑
A s soon as you are finished with dishes, place them in the dishwasher or stack them neatly in the sink.
❑
O nce again, keep the home clutter-free. Buyers won’t purchase a home they can’t see. Get rid of anything you don’t need or use.
❑
E liminate bad smells by bathing your pets, cleaning out cat litter boxes frequently, shampooing the carpets, dry cleaning your drapes, emptying trash and ash trays often, and refraining from cooking fish and other strong smelling foods.
❑
I ntroduce good smells such as flowers, potpourri and air fresheners. Baking a frozen pie is another clever tactic some sellers use to make the home seem cozy and inviting.
❑
L et plenty of light in. Brightness improves a home’s atmosphere.
❑
M ake sure the temperature is comfortable.
❑
Y ou may want to set the dining room table to display a homey environment.
❑
H iring a cleaning service once a week will make it easier to keep the house in “show condition”.
❑
D uring a showing, it is recommended the seller not be home so that the buyers can feel free to ask the real estate professional candid questions.
❑
B e courteous, but don’t force conversation.
❑
T urn off radios and televisions; they can be distracting.
❑
K eep pets out of the way.
❑
D on’t apologize for the condition of the home. If there is a problem, pointing it out will emphasize it.
• Homes sell for the most amount of money in the first 14 days it is exposed to the market • Interest rates may impact how much a buyer is willing to pay for a home • Location is a large factor in figuring out a realistic price for your home. The same home in a different
neighborhood would have a different price. • It is also important to be clear on what exactly is included in the sales price. Any exclusion (such as removable
fixtures, decorative lighting, draperies, appliances, etc.) should be written into the contract.
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11
The Home Buying Process 15 Minute Checklist
Mortgage Company
Your real estate professional has called and will be arriving in 15 minutes to show your home. Here is a quick checklist to make sure you’re ready.
❑
P ick up debris (newspapers, clothes, etc.).
❑
T urn on lights, open curtains and make beds.
❑
T idy the kitchen:
®
Contract
Loan Application
Contract Received Buyer / Seller letters Sent
__ counter tops Credit Report Pulled
__ dishes
Title Search Performed Repair Title if Needed
__ take out trash
❑
Good Faith Estimate (GFE) Sent to Borrower
T idy the bathrooms:
Title Insurance Commitment
__ flush toilets __ shine fixtures __ hang towels neatly
Loan Scenario Changes
Loan Underwriting
__ empty trash __ wipe counters
❑
C lose garage door and make sure outside walks are clear of debris.
New GFE Sent
Buyer Approved
Lender Sends Closing Instructions
Title Examination Clearance of underwriting objections Document Delivery Obtain Figures for payoff, property tax, property association, other liens
Document Preperation Copying Wiring Document handling Notarization Scanning Storage
Lender Closing Instructions Sent
Preperation of Documents
HUD-1 Tolerances are met from orginal GFE
Closing & funding
Post Closing & Recording
12
13
L. Settlement Charges 700. Total Real Estate Broker Fees
Paid From Borrower’s Funds at Settlement
Division of commission (line 700) as follows : 701. $
to
702. $
to
Paid From Seller’s Funds at Settlement
Key to the Settlement Statement (HUD-1)
703. Commission paid at settlement 704. 800. Items Payable in Connection with Loan
10
801. Our origination charge
$
802. Your credit or charge (points) for the specific interest rate chosen
$
(from GFE #1)
The figures in the Buyer/Borrower’s column include loan fees, escrows, title service fees, and recordation tax. Note that most of the line items include a corresponding GFE block to make it easier for you to compare the actual settlement chanrges with the fee quote provided to you by your loan officer.
(from GFE #2)
803. Your adjusted origination charges
(from GFE #A)
804. Appraisal fee to
(from GFE #3)
805. Credit report to
(from GFE #3)
806. Tax service to
(from GFE #3)
807. Flood certification to
(from GFE #3)
808.
10 The 800s represent the lender’s fees. These charges are for the Buyer only
809. 810.
11 Line 901 is interest collected by the lender for the number of days left in the month of closing. To illustrate, for a closing on October 29, the lender will collect three days of interest closing (10/29–10/31), and the borrower’s first monthly payment will not be until December 1. Accordingly, the mortgage interest for November is included in the December payment.
811. 900. Items Required by Lender to be Paid in Advance
11
901. Daily interest charges from
to
902. Mortgage insurance premium for
@$
/day
(from GFE #10) (from GFE #3)
months to
903. Homeowner’s insurance for
years to
(from GFE #11)
904. 1000. Reserves Deposited with Lender
12
1001. Initial deposit for your escrow account
12 This section of the HUD-1 lists the amounts collected by the lender to be placed in the escrow account for the future payment of items such as homeowner’s insurance, mortgage insurance and property taxes. (Note that HOA/condo dues are NOT included and must be paid separately.)
(from GFE #9)
1002. Homeowner’s insurance
months @ $
per month
$
1003. Mortgage insurance
months @ $
per month
$
1004. Property Taxes
months @ $
per month
$
1005.
months @ $
per month
$
1006.
months @ $
per month
$
1007. Aggregate Adjustment
13 Line 1101 is the charge for all title services and the lender’s title insurance policy. Title services include title examination, title commitment preparation, preparing and issuing policies, and conducting the settlement.
-$
1100. Title Charges
13
(from GFE #4)
1101. Title services and lender’s title insurance $
1102. Settlement or closing fee
14
1103. Owner’s title insurance
14 Line 1103 represents Owner’s Title Insurance. Title insurance protects the Buyer and the Lender in the event a third party makes a claim against the title of the property. If a title claim occurs, it can be financially devastating to an owner who is uninsured. If you want to protect yourself from claims by others against your new home, you will need an owner’s policy.
(from GFE #5) $
1104. Lender’s title insurance 1105. Lender’s title policy limit $ 1106. Owner’s title policy limit $ 1107. Agent’s portion of the total title insurance premium to
$
1108. Underwriter’s portion of the total title insurance premium to
$
1109.
15 Filing fees paid to the Clerk of the land records in order to record the Deed and Mortgage.
1110. 1111.
16 Taxes paid to the County and the Commonwealth in which property is purchased—based on the sales price (or assessed value if that is higher) and the loan amount.
1200. Government Recording and Transfer Charges
15 16
(from GFE #7)
1201. Government recording charges 1202. Deed $
Mortgage $
Release $ (from GFE #8)
1203. Transfer taxes 1204. City/County tax/stamps
Deed $
Mortgage $
1205. State tax/stamps
Deed $
Mortgage $
1206. 1300. Additional Settlement Charges (from GFE #6)
1301. Required services that you can shop for 1302.
$
1303.
$
1304. 1305. 1400. Total Settlement Charges (enter on lines 103, Section J and 502, Section K)
Previous edition are obsolete
Page 2 of 3
HUD-1
41
17
18
Comparison of Good Faith Estimate (GFE) and HUD-1 Charrges
HUD-1
Good Faith Estimate
Charges That Cannot Increase
HUD-1 Line Number
Our origination charge
# 801
Your credit or charge (points) for the specific interest rate chosen
# 802
Your adjusted origination charges
# 803
Transfer taxes
# 1203
Key to the Settlement Statement (HUD-1) Good Faith Estimate
Charges That In Total Cannot Increase More Than 10% Government recording charges
HUD-1
# 1201
There are three categories in the Comparison Chart:
# # # # # # # Total Increase between GFE and HUD-1 Charges
19
Charges That Can Change
%
Good Faith Estimate
Initial deposit for your escrow account Daily interest charges
or
$
$
HUD-1
# 1001 /day
Homeowner’s insurance
# 901 # 903 #
17 Sections 17, 18 & 19 represent comparisons between the Good Faith Estimate provided by the lender and the HUD-1 statement. The lender has to comply with certain requirements when 18 quoting fees. You will note that in the first box there is zero tolerance between what is quoted 19 and what is paid at settlement. That means the lender will have to credit the Buyer if they underestimate. In Box 18, you compare the total quote with the total paid on the HUD-1. Any amount the Buyer pays that is more that 10% over the quote must be reimbursed by the lender. In Box 19, the Buyer sees charges the lender has no control over. These charges can fluctuate as needed.
# #
Loan Terms
20
Your initial loan amount is Your loan term is
years
Your initial interest rate is
%
Your initial monthly amount owed for principal, interest, and any
Compare the charges listed in the GFE column with the charges listed in the HUD-1 column. If the charges that cannot increase have increased (even by a penny), and/or the total of charges that cannot increase by more than 10% have exceeded the 10% limit, the lender must the overage at closing or within 30 days after closing.
$
includes
$
mortgage insurance is
Principal Interest Mortgage Insurance
Can your interest rate rise?
No
20 Box 20 reflects the loan terms. This provides a snapshot of all terms for Buyer to review.
Yes, it can rise to a maximum of
and can change again every
after
interest rate can increase or decrease by guaranteed to never be lower than Even if you make payments on time, can your loan balance rise? Even if you make payments on time, can your monthly amount owed for principal, interest, and mortgage insurance rise? Does your loan have a prepayment penalty? Does your loan have a balloon payment? on Total monthly amount owed including escrow account payments
. Every change date, your
%. Over the life of the loan, your interest rate is % or higher than
No
Yes, it can rise to a maximum of $
No
Yes, the first increase can be on
owed can rise to $
%. The first change will be on
%.
and the monthly amount
. The maximum it can ever rise to is $
No
Yes, your maximum prepayment penalty is $
No
Yes, you have a balloon payment of $ .
.
due in
years
You do not have a monthly escrow payment for items, such as property taxes and homeowner’s insurance. You must pay these items directly yourself. You have an additional monthly escrow payment of $ that results in a total initial monthly amount owed of $
. This includes
principal, interest, any mortagage insurance and any items checked below: Property taxes
Homeowner’s insurance
Flood insurance
Note: If you have any questions about the Settlement Charges and Loan Terms listed on this form, please contact your lender.
Previous edition are obsolete
Page 3 of 3
HUD-1
43
House Comparison Chart
44
House Comparison Chart
Address
Address
Price
Price
Location
Location
Curb Appeal
Curb Appeal
Neighborhood
Neighborhood
Yard / Landscaping
Yard / Landscaping
Lot Size
Lot Size
Floor Plan
Floor Plan
Bedrooms
Bedrooms
Rooms Sizes
Rooms Sizes
Bathrooms
Bathrooms
Study / Office
Study / Office
Kitchen
Kitchen
Appliances
Appliances
Storage
Storage
Garage
Garage
Deck / Patio
Deck / Patio
Pool / Hot Tub
Pool / Hot Tub
Heat / AC
Heat / AC
Taxes
Taxes
School
School
Condition
Condition
Energy Efficiency
Energy Efficiency
45
Repair and Cleaning Checklist A clean, neat home that looks nice and maximizes space will sell faster and at a higher price. Keep in mind, a small investment in time and/or money could make your home much more attractive to buyers.
Garage
Okay as is Needs work
Are the floors swept and stain free? Are all items stacked against walls to allow for maximum floor space?
Exterior
Okay as is Needs work
Does the house need fresh paint?
In the garage organized and neat and well lit?
Are holes and cracks visible?
Attic
Are sidewalks, porches and decks swept, and in good shape?
Okay as is Needs work
Is the attic organized and clean?
Is there an inviting appeal?
Are the stairs in good condition?
Do the windows and door screens need to be replaced?
In the attic well lit?
Does the house trim need repair/paint?
Are there any signs of insects or rodents?
Are gutters and downspouts secure and clean? Landscape
Is the garage door opener operating correctly?
Kitchen Okay as is Needs work
Are shrubs and trees trimmed?
Okay as is Needs work
Are the appliances clean and working? Are all the cabinets neat and in good condition?
Is the lawn fertilized?
Are all counter tops clean and uncluttered?
Are flowers planted?
Does the tile need regrouting?
Is the lawn moved and edged?
Does the sink need to be recaulked, chips repaired or stains removed?
Has the lawn been weeded?
Do the faucets leak? Roof
Okay as is Needs work Is the oven clean?
Are there any leaks or unlevel areas? Bathroom
Okay as is Needs work
Are there shingles or tiles missing? Do the faucets leak? Does the roof have any unlevel areas? Does the tub need recaulking? Does the shower tiles need new grout?
46
47
Moving Tips Moving is one of the most stressful things a person can go through. In order to
Are the shower doors clean?
alleviate as much of that stress as possible, you should start early (as soon as you decide to sell your house) and follow a time table.
Is the floor in good condition?
Choosing a Mover
Is the gas igniter working properly (be sure to leave the key when you leave)? Overall Are there excess items that can be pre-packed in order to make home appear larger? Do the walls and woodwork need new paint?
Okay as is Needs work
If you decide not to do the move yourself, you’ll need to choose a mover. Here are a few additional tips for choosing a moving company: • Spend as little as possible, but also make sure you are choosing movers with the right equipment and experience • Ask for references • Get estimates in writing
Are there any holes or cracks in the walls?
• Be aware that you can get discounts depending on your profession and other organizations you may belong to
Does the wallpaper need to be replaced?
• Confirm mover credentials. Movers should be licensed and bonded, and employees should have workers’
compensation insurance Are the windows clean (inside and out)? Are the floors clean and polished? Are there any stains or damage from water leaks?
8 Weeks before the Move • Have a discussion with your mover, getting everything in writing, about costs, insurance, packing, loading,
delivery and the claims procedure Is the carpet clean, stretched flat and stain free?
• Make an inventory of your possessions. Decide what can be sold and what can be given away to charity
Are the draperies clean and properly working?
• Get copies of records from doctors, dentists, lawyers, etc.
Do any squeaky hinges need lubricating? Are the ceiling fans and vents clean?
• Make arrangements to transfer your children’s school records
4 Weeks before the Move
Do the windows open and close easily?
• If you are having the movers pack for you, arrange for this to happen a day or two before loading the truck
Has the house been deep cleaned? Hire a professional?
• If necessary, arrange for storage
Do any of the doors stick?
• Clean or repair any furniture, curtains or carpets that need it • Hold a garage sale
Do all the locks work properly and have keys?
• If you are moving yourself, figure out how many boxes you need
Do the doors seal properly?
• If you are moving yourself, figure out what size truck you will need by calculating the cubic feet of theboxes plus
large furniture pieces Are all lights working?
48
49
3 Weeks before the Move
2 or 3 Days before the Move
• Assemble packing materials:
• Defrost your refrigerator and freezer
___ Furniture pads
___ Bubble wrap
• Have your movers pack your shipment
___ Packing tape
___ Scissors
• Arrange to have payment ready for the driver on moving day
___ Large self-stick labels
___ Styrofoam peanuts
• Set aside valuables and legal papers to go with you
___ Felt-tip markers
___ Boxes
• Pack clothing and extra toiletries to go with you
___ Nylon packing string and rope
___ Utility Knife
• Pack your first-day handy items box (see Delivery Day below)
___ Crumbled newspaper • Begin packing items that you won’t need • Arrange to cancel utilities and services at your old home and have them installed at your new home • Make travel and hotel reservations • Organize car license, registration and insurance
2 Weeks before the Move • Arrange to transfer all bank accounts to new branches • Make any special arrangements to move pets. Ask your veterinarian about how to make the move
Moving Day • Do-it-yourself movers should pick up the truck early • Make a list of every item and box loaded into the truck • Let the mover know how to reach you • Before you sign the mover’s agreement, read the conditions. Keep it in a safe place until your goods are delivered,
charges are paid and all claims are settled • Check to make sure you have turned off the water and that no leave-behind appliances are running in your old
house • Inspect attic and garage, and lock all doors and windows
as easy as possible for your pet • Inform current long-distance phone company of the date of your move, and make arrangements
for service at your new home • Have your car checked and serviced for the trip
Delivery Day • Assemble first-day handy items:
___ Scissors
___ Coffee Cups
___ Toiletries Kit
___ Paper plates
___ Bath towels
___ Snacks
• Send in change of address form to the U.S. Post Office
___ Masking tape
___ Trash bags
___ Soap
• Change your address with any magazine subscriptions you have
___ Shelf liner
___ Utility knife
___ Toilet paper
• Send a change of address notice to your friends and family
___ Pencils and paper
___ Local phone book
• Cancel any direct deposit and/or payment arrangements on bank accounts you are closing and any
delivery services
• Check off all boxes and items as they come off the truck
1 Week before the Move • Transfer any prescriptions to a pharmacy near your new home and return any library books and dvds • If you have small children, you may want to make arrangements for a baby sitter while you’re packing
• Make sure utilities are connected and install new locks • Be on hand to answer questions, pay the driver, give directions, take care of any last-minute problems and examine
your goods
or moving
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Glossary Adjustable Rate Mortgage (ARM)
Document Preparation
A loan with an interest rate that changes periodically in keeping with a current index, like one-year treasury bills. Typically, ARMs can’t jump more than two percentage points per year or six points about the starting rate.
A charge by an attorney for preparing legal documents for a transaction. Earnest Money
Amortization
An expert judgment or estimate of the quality or value of real estate as of a given date.
The deposit money given to the seller or his agent by the potential buyer upon the signing of the agreement of sale to show that he or she is serious about buying the house. If the sale goes through, the earnest money is applied against the down payment. If the sale does not go through, the earnest money will be forfeited or lost unless the binder or offer to purchase expressly provides that it is refundable.
Appraised Value
Encroachment
An estimate of the value of the property offered as security for a home loan. This appraisal is done for financial lending purposes and may not reflect the actual market value.
When a building overhangs someone else’s property, or a fence is built over the dividing line between two properties.
A payment plan which enables the borrower to reduce his debt gradually through monthly payments of principal. Appraisal
Encumbrance Bridging Finance
A short-term loan, usually at a higher rate of interest, taken out by people who have bought a house while waiting for theirs to be sold, or when a normal mortgage and their savings falls below the asking price. Caveat Emptor
Latin for “let the buyer beware”. This puts the burden onto the buyer to be satisfied with the item before purchasing the property.
An easement, mortgage or other liability on a property which impedes its use or transfer. Equity
The difference between the market value of the property and any loans that are outstanding on the property. Exclusions
Any item that is specifically not included in the sale, e.g., an above ground pool, garden shed.
Conventional Mortgage
A mortgage loan not insured by HUD or guaranteed by the Veterans’ Administration. It is subject to conditions established by the lending institution and state statutes. The mortgage rates may vary with different institutions and between states. (States have various interest limits.)
Escrow
Credit Report
Flat Interest Rate
A report on the past ability of a loan applicant to pay installment payments in a timely manner.
An interest rate that is based on the original amount of the mortgage for the whole term of the loan.
Commission
Fixed Rate Mortgage
Fee payable to real estate agent for selling the property by the person authorizing the same; usually a percentage of the sales price.
A loan that carries an unchangeable interest rate over its entire term – typically a period of 15 to 30 years.
Funds paid by one party to another (the escrow agent) to hold until the occurrence of a specified event, after which the funds are released to designated individual.
Fee Simple Contract of Sale
Written agreement setting out the terms and conditions of a property sale.
An estate under which the owner is entitled to unrestricted powers to dispose of the property. Homeowner’s Insurance
Covenant
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Conditions affecting the use of land or property written into the title.
Protects the property and contents in case of damage or loss; must be for at least the loan amount or for 80% of the value of the improvements, whichever is greater.
Deposit
Interest
Usually 10% of the purchase price of a property placed in trust as evidence of intention to buy. Non-refundable after exchange of contract, the deposit goes towards the purchase price when the sale goes through.
A charge paid for borrowing money.
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Interest Only Loan
Multiple Listing
Loan on which interest is only paid periodically and the principal paid at the end of the term. Inspections
System of selling the property through many agents. The buyer pays only one commission. This goes to the agent who lists the property on an official multiple listing form for other agents (if the agent sells the property) or is shared between the first agent and the agent who actually finds the buyer.
An examination of property for various reasons such as termite inspections; inspection to see if required repairs were made before funds are received, etc.
Offer to Purchase
Inventory
A formal legal agreement which offers a specified price for a specified property. The offer may be firm (no conditions attached) or conditional (certain conditions apply).
List of items included with a property for sale; usually furniture, furnishings and other removable items. Origination Fee Liabilities
A fee the buyer pays the lender to originate a new loan.
Your outstanding debts or what you owe. Owner’s Title Policy Leasehold
Insures that the buyer has title to the property.
Form of land tenure or property tenure where one party buys the right to occupy land or a building for a given length of time. As lease is a legal estate, leasehold estate can be bought and sold on the open market.
PITI
Lien
Abbreviation for principal, interest, taxes and insurance, all of which are lumped together in your monthly mortgage payment.
A claim by one person on the property of another as security for money owed. Such claims may include obligations not met or satisfied, judgments, unpaid taxes, materials or labor.
Points
Loan Application Fee
A one-time only fee you pay up front to your lender, sometimes in exchange for a slightly lower mortgage rate. One point equals 1% of the total amount you plan to borrow.
Paid to the lender at time of application; check with lender for amount. Principal Loan Discount
The actual amount of money that has been borrowed to buy a property.
The points a lender charges; may be paid by either buyer or seller on conventional loans; number of points fluctuates with mortgage money market.
Private Mortgage Insurance (PMI)
Insurance against a loss by a lender (mortgagee) in the event of default by a borrower (mortgagor). Maintenance Fee
Charged by the homeowner’s association as set out in the subdivision restrictions.
Realtor Fees
An amount paid to the Realtor as compensation for his/her services. Maturity Date
The last day of the term of the home loan agreement. The home loan must then be paid in full or the home loan agreement must be renewed.
Recording Fees
Mortgage
Restrictions
Legal agreement on the terms and conditions of a loan for the purpose of buying real estate. (A mortgagee lends the money to a mortgagor, the borrower).
Certified copy of deed restrictions required by lender.
Charged by the county clerk to record documents in the public records.
Settlement Lender Title Policy
Required by the lender to insure that the lender has a valid lien; does not protect the buyer.
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Completion of sale when balance of contract price is paid to the vendor and the buyer is legally entitled to take possession of the property.
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Notes Survey
Confirms lot size and identifies any encroachments or restrictions violations. Tax Proration
Seller pays his portion of taxes from January 1 to closing date. Title Insurance
Protects lenders and homeowners against loss of their interest in property due to legal defects in title. Title Search
The process of examining the land title to ensure the vendor has the right to sell and therefore transfer ownership. A title search details the names of the owners and other information about the property such as encumbrances or caveats on the title.
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The purpose of this guide is information only and is not intended to be any warranty or representation on the part of Mid-Atlantic Settlement Services, nor is it intended to be legal or financial advice. Please consult your attorney, mortgage lender and other professionals with regard to buying a home and obtaining a mortgage.
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