 |
|
| Office: | 828-771-2328 |
| Cell: | 828-242-9589 |
| Contact Kathleen | |
| Quick Search | |
| Enter identifying MLS
numbers
below 
separated by commas and click-on Search: |
|
To Download this page or print in PDF Format, go here.
As a Seller, You May Be Asked to “Pay Points”
“POINTS....” WHAT ARE THEY ALL ABOUT?
Whether called points, discount points, loan brokerage fee or new home loan fee, they are all the same. Points divide the magic behind a large number of home sales. So, since points are such a vital part of selling in today’s market, understanding them is important.
WHAT EXACTLY ARE POINTS?
Points are the money paid to the lender that allow the lender to make loans at a regulated, lower than market interest rate and still obtain the desired rate of return.
WHY NOT JUST RAISE THE INTEREST RATE?
In order to allow more people to buy their own home, the U.S. government established the FHA (Federal Housing Administration) and VA (Veterans Administration) loan programs. The VA program was established to assist out war veterans, and later all veterans, by eliminating the required down payment. The FHA program was developed to assist low to medium income families to purchase a home by reducing the required down payment. Originally, the government, which established the maximum interest that a lender may charge, regulated both programs. However, the VA program was changed after inception and only FHA loans have a regulated maximum interest rate. This maximum rate is often slightly below the going rate for mortgage money and thus the need for points to supplement the difference.
HOW ARE POINTS FIGURED?
One (1) point is one percent (1%) of the loan amount. Five (5) points on a $60,000 loan would be 5% of 60,000 or $3,000.WHO CAN PAY THE POINTS?
Either the buyer or seller can pay all points.
FACTS ABOUT TITLE INSURANCE
Q: I HAVE BEEN HEARING A LOT ABOUT TITLE INSURANCE RECENTLY. EXACTLY WHY IS IT NEEDED?
A: Title insurance provides protections against such unforeseen elements as claims against the title of your home that weren’t revealed during the title search. Most title hazards will show up during a title company’s investigation of public records but even the most exhaustive search may not bring all problems to light. Title insurance is written to provide protection against undisclosed risks.
Q: WHAT ARE SOME EXAMPLES OF TITLE CLAIMS?
A: One would be a claim by a missing heir or a previous owner. Other possible claims can include liens by contractors for unpaid work, a deed conveyed by a married person purporting to be single, boundary disputes or forged deeds. When claims are made, the title insurance company is responsible for satisfying legitimate insured claims or for defending the interests of the policyholder in court.
Q: ARE DIFFERENT KINDS OF POLICIES AVAILABLE?
A: Yes, generally there are two (2) forms. The first is lender’s title insurance. It is usually written in the amount of the home loan and protects the lending institution from losses resulting from defective titles. Lending institutions often will refuse to make a loan unless a lender’s policy is purchased. Because lender’s insurance expires when the mortgage loan is repaid, it does not protect the homebuyer from title defects. For this, you need a form of title insurance called an Owner’s Policy. It usually is written in the amount of the real estate purchase price. Coverage continues as long as a property owner, his heirs or persons to whom he may bequeath it, retain an interest in the property.
HINTS TO SELLERS FOR A SMOOTHER SETTLEMENT
There are about 60 people involved in the settlement of a real estate transaction. The following are tips to make the process run smoothly:
Call your lender for advice about making your mortgage payment during the month of closing. NOTE: If you make a payment after the payoff amount is determined, the closing/escrow statement will have to be changed, and your lender may charge a fee for updating the documents to reflect the new payout amount.
If you currently have a FHA mortgage, 30-day advance notice of mortgage payoff may have to be given to avoid an additional charge of one month’s interest. (Some lenders change charge a per diem rate, others charge 30 day’s interest.)
You should be aware that it is common practice to add several days’ interest to the amount due as of settlement on your mortgage payoff. Your lender considers the actual payout date to be the day the funds are received. If you have a local lender, it
Be sure to make arrangements to transfer all utilities out of your name as of the date of occupancy. If your home is heated by oil, it may be considered to be personal property and, as such, will be purchased by the buyer at the time of settlement. Please arrange for your vendor to measure the amount of remaining oil and to give you a written statement as to its current value. Bring that statement to closing or escrow.
Water and Sewer Bills (if applicable) will be probated on the closing statement. If you have a bill coming due near the date of settlement, please inform your closing/escrow agent as to whether or not you have paid it.
The following items are usually pro-rated on the closing/escrow statement:
Water/Sewer
Homeowner’s Association Fees
Condominium Association Fees
Current Taxes
Rents (If applicable)
If you will be unable to attend the closing/escrow, all documents may be pre-signed.
Some lending institutions have a policy of not releasing real estate tax escrows until after a loan is paid off in full. This may cause a temporary cash flow problem if all your proceeds of sale are needed immediately upon settlement. Call your lender and ask if the tax escrow will be fully credited on the payout statement.
CALCULATING YOUR EQUITY:
ESTIMATED SALE PRICE $____________
Subtract Settlement Expenses:
First Mortgage Balance (including second mortgages) $______________
Home Equity Line of Credit Balance $______________
Prepayment Penalty $______________
(Approx. 3 mos. Interest on 80% of mortgage balance)
Interest from the First of the Month $______________
Title Insurance $______________
Cost of Transferring Title $______________
(Fees, Stamps and/or Taxes)
Real Estate Tax Proration $______________
Recording Fees $______________
Attorney Fees $______________
Miscellaneous Fees – (The following items are not costs of the sale but should be reviewed if
applicable)
Home Warranty Fees $______________
Home Inspection Fee $______________
Termite/Pest Inspection Fee $______________
Water/Well/Septic Test Fees $______________
Radon/Asbestos Test Fees $______________
Discount Points (FHA – VA – Conventional) $______________
Special Assessments $______________
Security Deposits $______________
Other Expenses $______________
TOTAL SETTLEMENT EXPENSES (Subtracted from Est. Price) $______________
ADD CREDIT TAX AND ESCROW (If Applicable) $______________
TOTAL ESTIMATED PROCEEDS OF SALE $______________
Remember:
For Sale By Owner--Money Matter Center for Asheville, NC. Buying and selling a luxury home or finding that special piece of Asheville Real
Estate with Kathleen Blanchette,
a fully licensed Keller-Williams Asheville Real Estate Broker and Realtor, is a comprehensive and thoroughly professional
experience in buying and selling Asheville Real Estate throughout the Blueridge
and Smokey Mountains, where efficiency, personal regard and concierge services are
guaranteed every step of the way. Keeping the Tradition of Integrity...,
and a Reputation for Results!
Whether its a North Carolina luxury homes on your own Private Mountain Estate
in one of our uniquely designed plush Golfing Communities, Exclusive Gated Communities,
Active Adult Communities, surrounding Lake Communities, or a great Condominium,
Loft or Townhome, all of Greater Asheville and Hendersonville Luxury Homes are within reach with Kathleen Blanchette. Feel Free to browse the entire website of all available Greater Asheville Real Estate
MLS and Western North Carolina MLS,
for all Asheville Real Estate Properties, Land Acreage, Horse farms, Investment
Properties, Commercial Real Estate, New Home Plans, as well as handy relocation
and moving calculators, tips for buying and selling a house, For Sale By Owner--Money Matter Center for Asheville, NC.,
city and school reports, and more. Just call us when you're ready to move
ahead!
Asheville Real Estate
|
Asheville NC Real Estate MLS Property Search in All 9 Counties
