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Ask Realty Times - February 13, 2004
by Peter G. Miller
Question: Why does it take 45 days to close on a home sale? The loan is approved, the home inspection is done, it takes two weeks to search the title and the money is here. Can we demand a sooner closing date? Answer: When a purchase offer is made it includes a closing date. This date is negotiable on most standard agreements and such agreements may also have some fuzzy language. For instance, they may talk about closing "on or about" a given date or closing on a specific date unless there is mutual consent in writing to close earlier. You properly point out that many items needed to close can be done quickly. However, it may be that the sellers have not found a replacement property and need a little time. You could have stipulated an earlier closing date as part of your offer -- and possibly lost the property if the owners felt rushed. Now you have a sale agreement in hand so you can go to Plan B: Ask the sellers if they would be comfortable with an earlier closing date. Question: I'm interested in purchasing a home and the man who is working for the seller (I'm not sure who he is or where he came from) told me that he will do a "short sale." However, I HAVE to apply for a mortgage through him (when I already have a mortgage broker I want to work with) because of this short sale. I do not remember the details but he said something like he has to do it this way or else the house cannot be sold until after 12 months or something like that. Any thoughts? Answer: A "short sale" is typically a situation where the transaction is dependent on a lender accepting something less than the full mortgage amount owed by the owner. As you can guess, this does not thrill many lenders. Are you financially qualified to buy the home? If yes, why is to your advantage to only get a loan from one source? Does the loan have a balloon payment? A prepayment penalty? What type of mortgage is being proposed? If you don't finance as the third party wants does that mean you could not buy the house? Are there other houses for sale with similar qualities and prices in the area? Is your purchase dependent on a home inspection satisfactory to you? A title which is insurable and marketable? A clean title report and the ability to purchase title insurance at rates you find acceptable? Etc. Has the third party (the "man") provided an agency disclosure statement? Is this person a real estate broker? A lender? What disclosure, if any, is required in your state? What is his role in this transaction? Do not go further with this -- and do not sign anything -- until you have met with an experienced real estate attorney who can review the offer and provide specific advice. Question: I have received a new payment coupon for my mortgage which increases my monthly cost because I was short on my monthly escrow payment. Is this my fault, or the loan company's? Answer: In your situation you have a loan and an escrow account. The loan consists of a payment for principal and interest. If you have a fixed-rate loan this amount does not change during the life of the mortgage. The escrow account can change and likely will change over time. The escrow account is used to collect money each month to pay your property insurance and property taxes. As the value of your home increases, the friendly folks who assess home values will notice that your property is worth more. Combine a higher value with the tax rate and -- even if the tax rate does not increase -- the annual tax will go up. As well, a higher property value means additional insurance is required and so that cost will increase as well. Thus, what you see is not the fault of the loan company and it's not your fault. It's simply a bill which needs to be paid. For specifics, contact the lender and ask them to review the new charges and explain how they were determined. Question: I just signed a contact with an agent selling my house below market value. Is there such a thing as seller's remorse? Do I have three days to back out of the deal? Answer: You did not sell for less than market value. Assuming we have an informed buyer and an informed seller the property was sold for what it was worth on the open market. Surely other properties may be worth more -- but they may also have other features, the buyers may be more motivated, the seller may be pleased with a quick sale, etc. So, yes, there is such a thing as "seller's remorse" but in many cases it's caused by the fact that a home sale is a big transaction, one that includes a lot of non-cash values -- ego, status, complexity, etc. Sit down with your broker and analyze the transaction. If something seems seriously wrong, then review the agreement with an attorney. Question: What causes the water hammer, or extremely loud pinging of the hot water pipes that go to an upstairs bathroom, while the water is running and after it is turned off? It is making that noise while the pipes heat up and while they cool down. What can I try to stop the hammering? It appears to be related to the hot water only. Answer: Water travels through pipes under pressure. If you suddenly shut off a faucet you have water in motion within the plumbing system, the energy needs to dissipate somehow and air can be trapped. Have a plumber take a look at the system and ask if a "hammer arrester" or "air-cushion chamber" would solve the problem. Do this now -- it may be good to hammer nails but pipes are a different story.
This column is designed to provide accurate and authoritative information in regard to the subject matter covered. It is made available with the understanding that neither the author nor the publisher is engaged in rendering legal, accounting, or other professional services. If legal services or other expert assistance is required, the services of a competent professional person should be sought. | 
