Category: Dallas TX real estate

3 Tips for a Successful Residential Real Estate Closing Process

Whether you’re buying or selling a home, closing day is the most important day in the process. It’s the day you’ll take or relinquish ownership of the property. To ensure a successful closing day, you’ll want to handle the closing processwith care.

3 Tips for a Successful Residential Real Estate Closing Process

You can expect your real estate closing to take approximately two hours. You can also expect multiple parties to be involved, including a closing agent, your lender and your realtor (if applicable). To ensure a smooth closing process, here are some tips.

1. Do Your Due Diligence

If you’re a buyer, make sure you understand what you’re purchasing. Conduct a final walkthrough of your property to confirm there are no repairs still required or additional property issues. Look over your purchase agreement to ensure everything is as promised.

If you’re a seller, complete all necessary repairs as far in advance of closing as possible and make sure you’ve prepared the home well for its new owners.

2. Prepare Documentation & Payment in Advance

You’ll need some documentation on the day of your closing, including a photo ID and any outstanding forms for the title company or loan officer. You’ll also need the payment for your closing costs depending on your financial responsibility. 

In most cases, you can use a cashier’s check made payable to the closing company. Prepare your closing documents and payment in advance to ensure a faster closing process.

3. Consider Hiring a Real Estate Attorney

Although Texas doesn’t require you to have a real estate attorney when buying or selling property, real estate transactions are often complex. And sometimes disputes can arise during the closing process. An attorney can act on your behalf in the event of these disputes. 

For example, there might be something in the purchase agreement that wasn’t there before. You’ll want an attorney by your side to ensure your rights are protected as a buyer or seller.

Buying or Selling a Home? Reach Out to Lonergan Law Today.

Are you ready to buy or sell a home? Or are you worried about the closing process? The team at The Lonergan Law Firm, P.L.L.C. can help. To learn more about the closing process or to schedule a consult, give us a call at 214-760-6768 or send us a message.

Residential Closing Process: What to Expect as a Buyer

Whether you are purchasing your first home or investing in residential real estate, the closing process is an exciting time. This process involves a buyer and seller signing the necessary paperwork to make the sale official. To ensure the closing process moves as smoothly as possible, it’s best to be prepared.

What to Do Before the Closing

Before the closing occurs, there are a few steps to take as a buyer: 

  • Conduct a walkthrough: You should do a walkthrough of the property to ensure repairs have been made or that the property is ready for new ownership. If any difficulties arise, the closing date can be delayed. Make sure all parties are aware of the situation and can decide on the next best day for closing to take place. 
  • Have your payment prepared: Make sure you have an acceptable form of payment prepared such as a cashier’s check. Payment and fees will be paid for the property during closing. 
  • Bring proper identification to your closing appointment: Be prepared to bring your identification such as a driver’s license or passport for filing purposes.

What to Expect During Closing

During the closing meeting, you’ll be signing legal documents related to the property. These will differ between buyer and seller. As a buyer, you will sign an agreement between you and the lender (if you are seeking a mortgage). There could be a few parties at the meeting depending on your needs, including a closing agent, the lender and your realtor. We also recommend you have an attorney present to represent you and your interests.

Your closing agent will ensure all necessary paperwork is signed and recorded and all payments will be paid and distributed to the right parties. Once all documents are reviewed and signed, the closing process is complete.

Don’t Go Through the Residential Closing Process Alone

It’s in your best interest to hire an attorney to represent you during the closing process. Your attorney will ensure all paperwork is complete and that any situations that arise before or during the closing are taken care of. To learn more about the residential closing process in Dallas, Texas, reach out to us at the Lonergan Law Firm P.L.L.C.

Commercial Real Estate Mistakes To Avoid

If you’re new to the commercial real estate world or are looking at your first investment property, here are some points to consider before signing on the dotted line. 

Whose Name Goes on the Commercial Real Estate Paperwork?

In most cases, your business should purchase commercial property in the business’s name, not your own name. You’ll protect yourself from liability should there be an accident on the property or a problem with the title. It’s best to speak with an attorney who is familiar with commercial real estate matters before making a final determination on whether your name or your business’s name should appear on the purchase agreement. 

What Was the Commercial Property Used for in the Past?

It’s extremely important to know the property’s history. What may look like a hip, tiny restaurant now may have been a gas station or environmentally-regulated, hazardous waste site. Perhaps the prior sale happened decades ago before certain regulations took effect, or the property was inherited, repurposed and reopened on top of a chemical hazard before current regulations were in place. An experienced attorney can help investigate the history and the title and clear the way for sale and financing.

Commercial Zoning and Licensing

Evaluate and investigate the permissible land use for a property. If you plan to keep any structures that are present on the property, you must understand if you are legally allowed to operate your type of business on this particular property. The zoning laws governing the property determine the proper use and occupancy.

Additionally, you can’t always just move your business into an empty building on the property after the closing. You may need a new occupancy license or permit to operate. 

Commercial Loan Applications and Underwriting

Even before you start your search, explore lending options with several lenders. It’s important to understand what your lender will require before applying for a loan to purchase your property. You should also know what amount you’ll qualify for, if the lender will restrict the kind or location of the property you buy, or impose other restrictions on the loan qualification process. 

You should also understand your short- and long-term expectations for a property. Create a budget and plan for your move up to a year ahead of time. Investigate your up-front and closing costs, monthly expenses, mortgage expenses and what you need to generate in income each month to cover these expenses. 

Location, Location, Location

This is the cardinal rule in any real estate purchase. Choosing the wrong location can spell disaster for your business if there is no traffic or for resale in the future. Your broker can help you analyze the factors that are important to your business to see if a specific property makes financial sense for you. Don’t buy on emotion. You should also consider the intangibles like: 

  • Employee security and commuting distances
  • Traffic patterns and neighborhood demographics
  • Will customers come if they perceive that the neighborhood is not safe

Rely on Attorneys With Commercial Real Estate Experience

The most important thing you can do throughout the purchase process is to perform your due diligence on the entire transaction. Your broker or agent is knowledgeable, but not objective and independent from the sale or purchase. 

Work with an attorney with a history of commercial real estate experience for dedicated help. If you’re in Texas, we welcome you to reach out to us. Contact us as soon as possible to review your property’s details, title and history. 

From Contract to Closing

You’ve found the house of your dreams and you can hardly wait for moving day! If you are a Real Estate Investor, the property is your next deal and you are looking forward to rehabbing and renting or selling. Either way, your excitement level is high and you’re ready to get started.

There are important steps to take before settling into the sofa in this new home and each one is very important and can have financial consequences.

  1. Negotiate the contract with the seller. If your transaction involves a realtor, he or she will supply the contract and handle the negotiation. If you are buying a property directly from the owner, we suggest you involve a Real Estate Attorney to assist you with the negotiations.
  2. Apply for funding. Immediately after the contract is negotiated, the buyer needs to make application at a reputable lender. Buyers will need to provide all necessary information to the lender such as income, assets, debts and credit history. In tight markets where houses are hard to find, it may be necessary to become approved for a loan before looking for a house so you can make an offer on the same day you find the one you want. The realtor will need to stay in constant contact with the lender regarding buyer’s application.
  3. Fully evaluate the property. The contract has a provision for “termination options”. The buyer pays a negotiated amount for the number of days necessary to complete their due diligence. A complete inspection of the property, including a termite inspection, should be ordered and paid for by the buyer from an inspector deemed to be an expert. After reviewing the inspection report, the buyer(s) has a right to request that the seller(s) address all concerns they may have about the property, which may result in a renegotiation, or even a termination, of the contract.
  4. Get the property appraised. The lender will require a property appraisal to make sure that its value is equal to or greater than the requested loan amount. The appraiser’s evaluation must prove that the property is worth at least as much as the buyer agreed to pay.
  5. Wait on loan approval! When the lender has completed the due diligence and made a decision on the loan, the buyer will be notified. The buyer’s agent as well as the seller’s agent should work to ensure that the lender has all the documents necessary and that all steps are taken in the loan approval process in order to avoid a delay in the closing.
  6. Select a title company, preferably one with a Board Certified Residential Real Estate Attorney, who will close the title or supervise the closing and has years of operational experience.
  • The title company does a title search and determines that the real estate title is legitimate and whom the title is vested in, so the buyer can be confident that he or she is the legal owner of the real estate.
  • This process includes searching for outstanding mortgages, judgments, liens, restrictions, leases, easements, unpaid taxes, or other encumbrances against the property that may affect ownership.
  • The title company will strongly recommend to the buyer to purchase title insurance in case the title examiner or other party had made a mistake in the title search or in case there is some unknown issue back in the chain of title, such as a forgery, for example. This insurance is another level of protection. If the buyer chooses (or if the seller is contractually obligated) to purchase the title insurance for the property, the title company then issues a title insurance policy. This insurance protects the owner and/or lender from potential claims or lawsuits that may result over ownership disputes.
  • Bring the following to the closing – valid photo id (driver’s license or passport), cashier’s check or certified check for the down payment and closing costs (never bring cash), proof of insurance, and the final purchase and sales contract. In case there is a small fee that was unanticipated, it is always a good idea to bring a blank personal check.
  • Expect to sign these and other documents at the title closing. (a) Closing Disclosure or HUD-1 Settlement Statement (multiple pages), (b) Warranty Deed, and (c) title company requested documents.
  1. Purchase homeowners’ insurance. If you are the intended homeowner, expect the lender to have pre-determined requirements. The seller’s agent should help the buyer ensure that proper coverage is purchased. If you are purchasing for cash or if you are a real estate investor, depending on the transaction, either you will purchase it or an end-buyer will acquire the insurance with you as an additional insured.
  2. Transfer utilities. It is prudent for the buyer and seller to make arrangements for the utilities to be transferred to the buyer if necessary, usually upon the closing date. Buyers may need to make application to the various utility companies.

CONCLUSION

Purchasing a house for yourself or as an investor is much more than one big step! It is a series of important actions that must be completed in order to ensure that you will be the lawful owner of the property, take only a suitable financial risk in securing funding, and that the property is in good shape to mitigate big surprises after you take possession.

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© Gaylene Rogers Lonergan and Lonergan Law Firm, PLLC, 2017. All rights reserved. This article is provided for educational reasons exclusively and is not meant to be construed as legal advice. The Lonergan Law Firm, PLLC, will represent you only after being retained and that agreement is made in writing.

Gaylene Rogers Lonergan | The Lonergan Law Firm, PLLC                                escrow2@lonerganlaw.com | 214-503-7509