Understand Title Insurance

Why Title Insurance?

Owning real estate is one of the most precious values of freedom in this country. You want the assurance that the property you are buying will be yours. Other than your mortgage holder, no one else should have any claims or restrictions against your home.

Title insurance is issued after a careful examination of the public records. But even the most thorough search cannot absolutely assure that no title faults are present, despite the knowledge and experience of professional title examiners. In addition to matters shown by public records, other title problems may exist that cannot be disclosed in a search. Title insurance eliminates any risks and losses caused by faults in title from an event that occurred before you owned the property.

Title insurance is different from other types of insurance in that it protects you, the insured, from a loss that may occur from matters or faults from the past. Other types of insurance such as auto, life, or health cover you against losses that may occur in the future. Title insurance does not protect against any future faults, but does protect you from risks or undiscovered interests. Another difference is that you pay a one-time premium for a policy that remains effective until the property is sold to a new owner – even if that doesn’t occur for decades.

What is a Lender’s Policy? (Only apply if a lender’s involved)

A lender’s policy, also known as a loan policy or a mortgage policy, protects the lender against loss due to unknown title defects. It also protects the lender’s interest from certain matters which may exist, but may not be known at the time of the sale.

This policy only protects the lender’s interest. It does not protect the purchaser. That is why a real estate purchaser needs an owner’s policy.

What is an owner’s policy?

An owner’s policy protects you, the Buyer, against a loss that may occur from a fault in the ownership or interest you have in the property. You should protect the equity in your new home with a title policy.

What does an owner’s policy provide?

Protection from financial loss due to demands that may be charged against the title to your home, up to the cost of the title policy.

Payment of legal costs if the title insurer has to defend your title against a covered claim.

Payment of successful claims against the title to your home covered by the policy, up to the cost of the policy.

Why the seller needs to provide title insurance?

Any purchaser will need evidence that his investment in your property is free of title defects. The title insurance policy that you provide the purchaser is a guarantee that you are selling a clear title to your real estate, unencumbered by any legal attachments that might limit or jeopardize ownership. It will reassure your purchaser that he or she is protected from any risks or losses and could help you close your deal.

Why the buyer needs title insurance?

Without title insurance, you may not be fully protected against errors in public records, hidden defects not disclosed by the public records, or mistakes in examination of the title. As a result, you may be held fully accountable for any prior liens, judgments or claims brought against your new property. If this should occur, your title policy insures that you will be defended at no cost against all covered claims up to the amount of the policy.

How much does title insurance cost?

The insurance commission approves and controls the premiums for title insurance policies. The premiums are paid only once and the cost depends upon the purchase price of the property and the policy amount must be equal to the purchase price.

What does title insurance protect from?

  • Undisclosed heirs
  • Forged deeds, mortgages, wills, releases and other documents
  • False impersonation of the true land owner
  • Deeds by minors
  • Documents executed by a revoked or expired Power of Attorney
  • False affidavits of death or heirship
  • Probate matters
  • Fraud
  • Deeds and wills by persons of unsound mind
  • Conveyances by undisclosed divorced spouses
  • Rights of divorced parties
  • Deeds by persons falsely representing their marital status
  • Adverse possession
  • Defective acknowledgements due to improper or expired notarization
  • Forfeitures of real property due to criminal acts
  • Mistakes and omissions resulting in improper abstracting
  • Errors in tax records

More info, please visit Century 21 Scheetz’s exclusive Title Company, DOMINION TITLE SERVICES, at https://www.dominiontitlellc.com/title-insurance


Posted on August 30, 2019 at 2:30 pm
Megan Dohman | Posted in Uncategorized |

7 Reasons Pre-Listing Inspections are an absolute MUST! Copy

After several days (or weeks) of negotiating, an agreement between the buyer and seller is finally reached! The buyer is excited that they’ve found their new home, the seller is glad they will be able to move on to whatever is next and the agents are glad that their goals for that listing have come to fruition.

Contrary to what might be depicted on television, when a contract is executed is not the time to begin celebrating. It marks the beginning of a long and uncertain process to a potential closing. There are almost always inspections to go through as well as an appraisal, if the buyer is getting financing. Much can go wrong with so many hands in the pot, and the fear of the unknown is real.

The best way to increase a seller’s chances of crossing the closing finish line is to have a pre-listing inspection done before ever coming on the market. Here are seven reasons why:

1. What you don’t know can hurt you

Knowledge is power, and surprise is never a good thing. It is easy for sellers to have a superficial and inflated view of their home. What could be wrong, they think? They’ve lived there for x years and if there was something seriously wrong, they would know it. Or, they just bought the home four years ago and had it inspected then — why would they need to do this now? You see, it is those very thoughts that can come back to bite sellers. When was the last time you went on your roof, looked in chimney, crawled around in attic or basement or under the foundation? Do you know how old your water heater and HVAC are? If you live in an older home, what about the plumbing and electrical systems?

This is exactly why you should have a pre-listing inspection. So you can get a grip on the physical health of your home.

2. You might not have to fix everything

Sellers, having a pre-listing inspection does not mean you have to fix every item that comes up — but you do need to disclose everything. This is where I, as an agent, come in to strategize with you on a plan of attack and what makes the most sense given the market, your competition, time frame for moving, etc.

Some things might need to be fixed in order to give comfort to a buyer or to qualify for the kind of financing they might be doing. For example, if there are buyers obtaining FHA or VA financing, any wood rot or termite damage will need to be fixed before the buyer can obtain the loan.

There might be items that are major vs. minor, we will need to take into account when pricing the home as they can definitely have an affect on what a buyer is willing to pay. Homes with older roofs, HVAC’s and water heaters on top of other repairs, coupled with a home that needs cosmetic updates can be viewed as “a money pit” in the eyes of a buyer.

If you are faced with a multitude of expensive items nearing the end of their life, you might need to consider replacing at least one and be willing to offer a home warranty to provide some coverage to the buyer for the first year of their ownership. The 15-year-old HVAC might be working great now, but that does not mean it won’t fail in the near future.

3. Disclosure is not an unpleasant surprise

Many sellers fear that by having an inspection, they will then have to disclose everything to a buyer which may cause them to pay less for the house. The truth is, a buyer is going to find out anyway, but it will be after they’ve already agreed upon a price and terms that they might not want to pay after the outcome of that inspection.

Avoid buyer’s remorse by shifting the knowledge of the home’s condition to the front end of the transaction rather than after the negotiation. Although a buyer will still have the property inspected by their own inspector, the information found will not be a surprise.

All houses have “things” that are found on an inspection. Even new homes that are under construction or nearly complete have items that need correction by the builder after they are inspected — this despite having a project manager who oversees the subcontractors working on the house.

4. It can keep the deal together

Back to the “surprise is never a good thing” concept, when you leave discovery of the home’s condition entirely to the buyer is when problems arise. The seller has already agreed upon a price and terms and depending on your home and the time of year it is on the market, the actual time to go under contract may have taken longer than what you thought.

You will have grown weary from numerous showings, second showings and “almost offers” that have never materialized. Now, you finally have a buyer and the transaction may be in jeopardy because of the outcome of the inspection.

The buyer wants to renegotiate the purchase price and/or ask for all repairs to be made or a huge concession to account for what was found. The sellers don’t feel like giving anymore, especially when they might be selling for less than what they thought (which is how most sellers often end up feeling). They could be paying closing costs on behalf of the buyer in addition to agreeing to leave certain appliances, such as the refrigerator and/or washer and dryer.

Everyone goes into full-on crisis mode trying to obtain estimates for the repairs and it is a hurry-up-and-wait game trying to get contractors over to look at the findings and then even more waiting to get their written quotes.

Keep in mind that buyers and their agents don’t always have a realistic handle on the true cost of repairs found from an inspection and might inflate or over-exaggerate the potential costs on purpose as a way to beat down the agreed upon price or force the seller to make repairs. Buyers might seek opinions from overpriced vendors trying to upsell, and sellers will find themselves running interference with this information trying to get their own quotes.

All of this chaos ensues while the clock keeps ticking on the inspection time frame as set forth in the purchase contract. Most contract time frames never take into account the real world of waiting on repair specialists.

What is unknown is simply an excuse most times for not taking the time to find something out ahead of time rather than after the fact. Sticking your head in the sand like an ostrich and being in denial of any inspection issues is not going to help get the home sold.

5. Incompetent inspectors can ruin a sale

What is required to become a home inspector varies from state to state and just because some states require licensure does not automatically grant that inspector sound judgement and the ability to legitimately diagnose/interpret a home’s condition. A license is never a substitute for competence — ask any seasoned real estate agent who has listed properties the amount of times they have had to run interference with an inspector’s report that was full of misdiagnoses.

The prospect of rookie inspectors who have only been functioning as an inspector barely a year or two — and who are running their own shop with virtually no support system and a more experienced inspector to mentor them — is cause for concern. They are crawling through someone’s largest investment and they don’t know what they don’t know and only know enough to be dangerous.

Newer inspectors often discount their fees as a way to build their business, and so what looks like a bargain compared to what more experienced and savvy inspectors charge is often at the expense of the transaction. Buyers might shop by price alone or an agent gives them a “coupon” that the inspector sent out in an email blast to agents hoping that it would generate some referrals. The agent might be newer and might have not vetted the inspector and doesn’t realize all inspectors, like agents, are not the same.

Although buyers have the right to choose whatever inspector they want, having your own inspection done by a vetted, experienced, adequately insured and credible inspector can be a huge asset. That inspector will be available to consult with you during the home sale process and can assist with running interference should an incompetent inspector cross the home’s path.

6. You’ll have a smoother transaction and a faster closing

All parties want a purchase and sale process that is free of hitches and can close within a reasonable period of time. By getting a pre-listing inspection, the risk of the unknown is eliminated and the parties will enter a negotiation feeling confident and empowered.

If a seller is unable or does not wish to take on repairs, the property can be priced accordingly. At the same time, if a seller has replaced a big ticket item, like a roof or HVAC, it might help the home sell faster as the buyer might be willing to make an offer and pay a higher price because of it.

A significant portion of time that is normally eaten up by the inspection period and all of the back and forth trying to resolve repairs is reduced since everyone is aware of the issues and has a handle on what will or will not be done.

7. The home will be more insurable

Some repairs might have to be made for the next buyer to get insurance or they will likely need to have them done within the first 30 days of owning the home in order to get a lower insurance rate. If a seller has an an older home with knob and tube or aluminum wiring, for example, a buyer might run into a snag getting insurance or the quote might be much higher than anticipated.

The seller might have lived with older electrical or plumbing and not had any issues, however, this can become an issue for the next buyer. It is easy for sellers to become numb to issues that don’t concern them. Unfortunately, real estate transactions don’t work like that, and these are serious concerns any buyer would have before sealing the deal.

Buyer’s are often hesitant to take on significant projects, like a whole house rewire or re-plumbing, unless they can get it at the right price or a seller is willing to pay a significant portion of their closing costs to offset the amount such a project will cost.

Why risk a seller’s home sale while an unknown inspector could potentially wreak havoc on the home’s condition and ultimately thwart the entire transaction?  Knowledge is power. Just as a buyer needs to do their due diligence, a seller needs to do theirs so that bad judgement calls don’t derail their deal.


Posted on April 22, 2019 at 8:49 pm
Megan Dohman | Posted in Uncategorized |

7 Reasons Pre-Listing Inspections are an absolute MUST!

After several days (or weeks) of negotiating, an agreement between the buyer and seller is finally reached! The buyer is excited that they’ve found their new home, the seller is glad they will be able to move on to whatever is next and the agents are glad that their goals for that listing have come to fruition.

Contrary to what might be depicted on television, when a contract is executed is not the time to begin celebrating. It marks the beginning of a long and uncertain process to a potential closing. There are almost always inspections to go through as well as an appraisal, if the buyer is getting financing. Much can go wrong with so many hands in the pot, and the fear of the unknown is real.

The best way to increase a seller’s chances of crossing the closing finish line is to have a pre-listing inspection done before ever coming on the market. Here are seven reasons why:

1. What you don’t know can hurt you

Knowledge is power, and surprise is never a good thing. It is easy for sellers to have a superficial and inflated view of their home. What could be wrong, they think? They’ve lived there for x years and if there was something seriously wrong, they would know it. Or, they just bought the home four years ago and had it inspected then — why would they need to do this now? You see, it is those very thoughts that can come back to bite sellers. When was the last time you went on your roof, looked in chimney, crawled around in attic or basement or under the foundation? Do you know how old your water heater and HVAC are? If you live in an older home, what about the plumbing and electrical systems?

This is exactly why you should have a pre-listing inspection. So you can get a grip on the physical health of your home.

2. You might not have to fix everything

Sellers, having a pre-listing inspection does not mean you have to fix every item that comes up — but you do need to disclose everything. This is where I, as an agent, come in to strategize with you on a plan of attack and what makes the most sense given the market, your competition, time frame for moving, etc.

Some things might need to be fixed in order to give comfort to a buyer or to qualify for the kind of financing they might be doing. For example, if there are buyers obtaining FHA or VA financing, any wood rot or termite damage will need to be fixed before the buyer can obtain the loan.

There might be items that are major vs. minor, we will need to take into account when pricing the home as they can definitely have an affect on what a buyer is willing to pay. Homes with older roofs, HVAC’s and water heaters on top of other repairs, coupled with a home that needs cosmetic updates can be viewed as “a money pit” in the eyes of a buyer.

If you are faced with a multitude of expensive items nearing the end of their life, you might need to consider replacing at least one and be willing to offer a home warranty to provide some coverage to the buyer for the first year of their ownership. The 15-year-old HVAC might be working great now, but that does not mean it won’t fail in the near future.

3. Disclosure is not an unpleasant surprise

Many sellers fear that by having an inspection, they will then have to disclose everything to a buyer which may cause them to pay less for the house. The truth is, a buyer is going to find out anyway, but it will be after they’ve already agreed upon a price and terms that they might not want to pay after the outcome of that inspection.

Avoid buyer’s remorse by shifting the knowledge of the home’s condition to the front end of the transaction rather than after the negotiation. Although a buyer will still have the property inspected by their own inspector, the information found will not be a surprise.

All houses have “things” that are found on an inspection. Even new homes that are under construction or nearly complete have items that need correction by the builder after they are inspected — this despite having a project manager who oversees the subcontractors working on the house.

4. It can keep the deal together

Back to the “surprise is never a good thing” concept, when you leave discovery of the home’s condition entirely to the buyer is when problems arise. The seller has already agreed upon a price and terms and depending on your home and the time of year it is on the market, the actual time to go under contract may have taken longer than what you thought.

You will have grown weary from numerous showings, second showings and “almost offers” that have never materialized. Now, you finally have a buyer and the transaction may be in jeopardy because of the outcome of the inspection.

The buyer wants to renegotiate the purchase price and/or ask for all repairs to be made or a huge concession to account for what was found. The sellers don’t feel like giving anymore, especially when they might be selling for less than what they thought (which is how most sellers often end up feeling). They could be paying closing costs on behalf of the buyer in addition to agreeing to leave certain appliances, such as the refrigerator and/or washer and dryer.

Everyone goes into full-on crisis mode trying to obtain estimates for the repairs and it is a hurry-up-and-wait game trying to get contractors over to look at the findings and then even more waiting to get their written quotes.

Keep in mind that buyers and their agents don’t always have a realistic handle on the true cost of repairs found from an inspection and might inflate or over-exaggerate the potential costs on purpose as a way to beat down the agreed upon price or force the seller to make repairs. Buyers might seek opinions from overpriced vendors trying to upsell, and sellers will find themselves running interference with this information trying to get their own quotes.

All of this chaos ensues while the clock keeps ticking on the inspection time frame as set forth in the purchase contract. Most contract time frames never take into account the real world of waiting on repair specialists.

What is unknown is simply an excuse most times for not taking the time to find something out ahead of time rather than after the fact. Sticking your head in the sand like an ostrich and being in denial of any inspection issues is not going to help get the home sold.

5. Incompetent inspectors can ruin a sale

What is required to become a home inspector varies from state to state and just because some states require licensure does not automatically grant that inspector sound judgement and the ability to legitimately diagnose/interpret a home’s condition. A license is never a substitute for competence — ask any seasoned real estate agent who has listed properties the amount of times they have had to run interference with an inspector’s report that was full of misdiagnoses.

The prospect of rookie inspectors who have only been functioning as an inspector barely a year or two — and who are running their own shop with virtually no support system and a more experienced inspector to mentor them — is cause for concern. They are crawling through someone’s largest investment and they don’t know what they don’t know and only know enough to be dangerous.

Newer inspectors often discount their fees as a way to build their business, and so what looks like a bargain compared to what more experienced and savvy inspectors charge is often at the expense of the transaction. Buyers might shop by price alone or an agent gives them a “coupon” that the inspector sent out in an email blast to agents hoping that it would generate some referrals. The agent might be newer and might have not vetted the inspector and doesn’t realize all inspectors, like agents, are not the same.

Although buyers have the right to choose whatever inspector they want, having your own inspection done by a vetted, experienced, adequately insured and credible inspector can be a huge asset. That inspector will be available to consult with you during the home sale process and can assist with running interference should an incompetent inspector cross the home’s path.

6. You’ll have a smoother transaction and a faster closing

All parties want a purchase and sale process that is free of hitches and can close within a reasonable period of time. By getting a pre-listing inspection, the risk of the unknown is eliminated and the parties will enter a negotiation feeling confident and empowered.

If a seller is unable or does not wish to take on repairs, the property can be priced accordingly. At the same time, if a seller has replaced a big ticket item, like a roof or HVAC, it might help the home sell faster as the buyer might be willing to make an offer and pay a higher price because of it.

A significant portion of time that is normally eaten up by the inspection period and all of the back and forth trying to resolve repairs is reduced since everyone is aware of the issues and has a handle on what will or will not be done.

7. The home will be more insurable

Some repairs might have to be made for the next buyer to get insurance or they will likely need to have them done within the first 30 days of owning the home in order to get a lower insurance rate. If a seller has an an older home with knob and tube or aluminum wiring, for example, a buyer might run into a snag getting insurance or the quote might be much higher than anticipated.

The seller might have lived with older electrical or plumbing and not had any issues, however, this can become an issue for the next buyer. It is easy for sellers to become numb to issues that don’t concern them. Unfortunately, real estate transactions don’t work like that, and these are serious concerns any buyer would have before sealing the deal.

Buyer’s are often hesitant to take on significant projects, like a whole house rewire or re-plumbing, unless they can get it at the right price or a seller is willing to pay a significant portion of their closing costs to offset the amount such a project will cost.

Why risk a seller’s home sale while an unknown inspector could potentially wreak havoc on the home’s condition and ultimately thwart the entire transaction?  Knowledge is power. Just as a buyer needs to do their due diligence, a seller needs to do theirs so that bad judgement calls don’t derail their deal.


Posted on April 22, 2019 at 8:44 pm
Megan Dohman | Posted in Uncategorized |

BEWARE OF WIRE FRAUD

Unfortunately, one of the not fun parts of buying or selling real estate is that you become a target for cyber crime, phishing schemes and wire fraud. Hackers target home buyers and sellers by attempting to hack not only your email account but by trying to hack potentially anyone involved in the transaction (us, your lender, the Title company, etc) so they can send fraudulent – yet incredibly legitimate looking – emails to you with false wire transfer instructions and even real phone numbers that will confirm instructions if called.

  • Once you go under contract, be on guard for out of the ordinary communications from then until closing. Know that I will NEVER send you any wire transfer instructions.
  • Carefully read any closing instructions and title company information once you receive wire transfer instructions. False email addresses, company phone numbers and contact information will have subtle differences between their real counterparts so use Google to confirm them before inquiring.
  • Do NOT wire transfer your funds more than 1 day before closing. Hacker tactics range from telling you to “wire money immediately” and “not to call your agent because they are busy.” In the event of wire fraud it’s nearly impossible to get funds back after 24 hours which is why the hackers create a sense of urgency in their emails.
  • Hackers have recently started asking for confirmation of personal identifiable information through spoofed emails for identity theft purposes. From here until closing think twice before sending W2′s, bank account statements or other personally identifiable information through email. Likely the only person who will need these items is your lender so talk to your lender ahead of time about dropping these items off in person or uploading them to a secure portal. I will NEVER ask for personal information such as a W2, copy of your driver’s license, etc. nor will I ever ask you for any money.
  • Once you have wire transferred your funds alert me and your lender immediately with the amount of the wire transfer and time they were transferred so I can follow up with the Title company to ensure the money was received. In the event of a problem the sooner we can act and involve the FBI the greater the chance of getting your money back.
  • If you feel as if you’ve mistakenly wired money call someone on your closing team immediately and report it to the FBI here: ic3.gov/default.aspx.
  • It’s best if you can avoid wire transferring money if at all possible. Therefore, once you go under contract for earnest money payments we recommend dropping off a personal check as it’s the most secure option available.  For closing day, instead of wire transferring money you can bring a cashier’s check IF the amount you owe for the down payment and closing costs is LESS than $10,000.  If it’s more than $10,000 then legally your only option is to wire transfer the funds.
  • We have put a lot of systems in place to safeguard our email system and your data. There are also things you can do to make it harder for a criminal to hack your email. Never use free public wifi such as at the airport, your favorite coffee shop, etc. Instead use your cell phone as a portable hot spot or buy your own hot spot to use when out and about. In addition, don’t click on links in any emails and don’t click on that “What’s your favorite type of puppy” survey online as those are often the way hackers get into your system.

For more information on cyber crime as a whole, here’s a great video with tips to prevent it from the National Association of REALTORS: http://bit.ly/NARWireFraudvideo

We are here to make sure you get to your closing and into your new home safely and securely so feel free to reach out to us at any time with questions. We are never too busy to talk with you.


Posted on February 1, 2019 at 11:16 pm
Megan Dohman | Posted in Uncategorized |

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