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The Texas Real Estate Commission has released an updated Seller’s Disclosure Notice for mandatory use Sept. 1.
It’s available for voluntary use immediately.
As of Sept. 1, 2019, the new Seller’s Disclosure Notice has questions in paragraphs 6, 7 and 8 relative to floodplains, and includes definitions of the various categories according to FEMA. In addition, questions about previous claims for flood damage or assistance from FEMA or SBA are also included.
The notice must also disclose a seller’s knowledge of water damage not due to a flood event and requires a seller to disclose whether a prior flood-related insurance claim was filed with an insurance provider or the seller received aid from FEMA.
Click here for the red-lined seller’s disclosure notice and click here for the blank seller’s disclosure notice.
Please note that beginning September 1, 2019, there will be a change to the basic premium rate for title insurance including an overall adjustment of -4.9 percent. Changes made in 2019 affect 2020 Texas title rates.
The Texas Commissioner of Insurance has issued an order adjusting the basic premium rate for title insurance and amending R-5, R-8 and R-20.
Summary of Changes
Basic Premium Rate – Includes an overall rate adjustment of -4.9 percent, a starting base rate of $25,000 and three new rate tiers for policies with face values over $25, $50 and $100 million.
Refinance Rate Amendment – Amends Rate Rule R-8 to provide for a 50 percent credit within the first four years and a 25 percent credit between four and eight years.
Simultaneous Issue Discount Expansion in R-5 – Allows a simultaneous issue rate credit for 90 days on transactions $5 million and above. The premium is $100 for each loan policy under these circumstances.
Construction Credit Expansion in R-20 – An extension of the credit for developers of large construction projects from one year to two years with a simultaneous issue rate for the loan policy.
These new rates will go into effect on all transactions that close (the date the papers are signed) starting on September 1, 2019.
Read the Order and View the Amendments
These changes are outlined in TDI’s adoption order. The revised rate chart and amended rules can be found in the following exhibits:
Republic Title Online Resources
Please visit our website for additional online resources including:
As always, please feel free to contact your escrow officer if you have any questions about the new rates. If you would like printed rate cards or need help using our online calculator, please contact one of business development representatives.
Here is some great advice for the first-time homebuyer.
Buying your first home comes with many big decisions, and it can be as scary as it is exciting. It’s easy to get swept up in the whirlwind of home shopping and make mistakes that could leave you with buyer’s remorse later.
If this is your first rodeo as a homebuyer or it’s been many years since you last bought a home, knowledge is power. Along with knowing what issues to avoid, it’s important to glean first-time homebuyer tips from the pros so you know what to expect and what questions to ask.
Here are 14 common first-time homebuyer mistakes, along with first-time homebuyer tips on how to avoid them:
Many first-time buyers make the mistake of viewing homes before ever getting in front of a mortgage lender. In some markets, housing inventory is still tight because there’s more buyer demand than affordable homes on the market. And in a competitive market, you could lose a property if you aren’t preapproved for a mortgage, says Alfredo Arteaga, a loan officer with Movement Mortgage in Mission Viejo, California.
How this affects you: You might get behind the ball if a home hits the market you love. You also might look at homes that, realistically, you can’t afford.
What to do instead: “Before you fall in love with that gorgeous dream house you’ve been eyeing, be sure to get a fully underwritten preapproval,” Arteaga says. Being preapproved sends the message that you’re a serious buyer whose credit and finances pass muster to successfully get a loan.
This one is a biggie. First-time buyers might get a mortgage from the first (and only) lender or bank they talk to, potentially leaving thousands of dollars on the table.
“A good mortgage loan officer can look at your situation and diagnose any potential roadblocks ahead to give you a clear understanding of your home-buying options,” Arteaga says.
How this affects you: The more you shop around, the better basis for comparison you’ll have to ensure you’re getting a good deal and the lowest rates possible.
What to do instead: Shop around with at least three different lenders, as well as a mortgage broker. Compare rates, lender fees and loan terms. Don’t discount customer service and lender responsiveness; both play key roles in making the mortgage approval process run smoothly.
It’s easy to fall in love with homes that might stretch your budget, but overextending yourself is never a good idea. And with home prices still rising, this is easier said than done.
How this affects you: Buying a home that exceeds your budget can put you at higher risk of losing your home if you fall on tough financial times. You’ll also have less wiggle room in your monthly budget for other bills and expenses.
What to do instead: Focus on what monthly payment you can afford rather than fixating on the maximum loan amount you qualify for. Just because you can qualify for a $300,000 loan, that doesn’t mean you can afford the monthly payments that come with it. Factor in your other obligations that don’t show on a credit report when determining how much house you can afford.
Buying a home can be complex, particularly when you get into the weeds of the mortgage process. Rushing the process can cost you later on, says Nick Bush, a Realtor with TowerHill Realty in Rockville, Maryland.
“The biggest mistake that I see (first-time buyers make) is to not plan far enough ahead for their purchase,” Bush says.
How this affects you: Rushing the process means you might be unable to save enough for a down payment and closing costs, address items on your credit report or make informed decisions.
What to do instead: Map out your home-buying timeline at least a year in advance. Keep in mind it can take months — even years — to repair poor credit and save enough for a sizable down payment. Work on boosting your credit score, paying down debt and saving more money to put you in a stronger position to get preapproved.
Spending all or most of their savings on the down payment and closing costs is one of the biggest first-time homebuyer mistakes, says Ed Conarchy, a mortgage planner and investment adviser at Cherry Creek Mortgage in Gurnee, Illinois.
“Some people scrape all their money together to make the 20 percent down payment so they don’t have to pay for mortgage insurance, but they are picking the wrong poison because they are left with no savings at all,” Conarchy says.
How this affects you: Homebuyers who put 20 percent or more down don’t have to pay for mortgage insurance when getting a conventional mortgage. That’s usually translated into substantial savings on the monthly mortgage payment. But it’s not worth the risk of living on the edge, Conarchy says.
What to do instead: Aim to have three to six months of living expenses in an emergency fund. Paying mortgage insurance isn’t ideal, but depleting your emergency or retirement savings to make a large down payment is riskier.
Lenders pull credit reports at preapproval to make sure things check out and again just before closing. They want to make sure nothing has changed in your financial picture.
How this affects you: Any new loans or credit card accounts on your credit report can jeopardize the closing and final loan approval. Buyers, especially first-timers, often learn this lesson the hard way.
What to do instead: Keep the status quo in your finances from preapproval to closing. Don’t open new credit cards, close existing accounts, take out new loans or make large purchases on existing credit accounts in the months leading up to applying for a mortgage through closing day. Pay down your existing balances to below 30 percent of your available credit limit, and pay your bills on time and in full every month.
Sure, you want a home that checks off the items on your wish list and meets your needs. Being nitpicky about a home’s cosmetics, however, can be short-sighted if you wind up in a neighborhood you hate, says Alison Bernstein, president and founder of Suburban Jungle, a real estate strategy firm.
“Selecting the right town is critical to your life and family development,” Bernstein says. “The goal is to find you and your brood a place where the culture and values of the (area) match yours. You can always trade up or down for a new home; add a third bathroom or renovate a basement.”
How this affects you: You could wind up loving your home but hating your neighborhood.
What to do instead: Ask your real estate agent to help you track down neighborhood crime stats and school ratings. Measure the drive from the neighborhood to your job to gauge commuting time and proximity to public transportation. Visit the neighborhood at different times to get a sense of traffic, neighbor interactions and the overall vibe to see if it’s an area that appeals to you.
Buying a house is a major life milestone. It’s a place where you’ll make memories, create a space that’s truly yours, and put down roots. It’s easy to get too attached and make emotional decisions, so remember that you’re also making one of the largest investments of your life, says Ralph DiBugnara, president of Home Qualified in New York City.
“With this being a strong seller’s market, a lot of first-time buyers are bidding over what they are comfortable with because it is taking them longer than usual to find homes,” DiBugnara says.
How this affects you: Emotional decisions could lead to overpaying for a home and stretching your budget beyond your means.
What to do instead: “Have a budget and stick to it,” DiBugnara says. “Don’t become emotionally attached to a home that is not yours.”
The long-held belief that you must put 20 percent down payment is a myth. While a 20 percent down payment does help you avoid paying private mortgage insurance, many buyers today don’t want (or can’t) put down that much money. In fact, the median down payment on a home is 13 percent, according to the National Association of Realtors.
How this affects you: Delaying your home purchase to save up 20 percent could take years, and you could limit cash flow that could be put to better use maximizing your retirement savings, adding to your emergency fund or paying down high-interest debt.
What to do instead: Consider other mortgage options. You can put as little as 3 percent down for a conventional mortgage (note: you’ll pay mortgage insurance). Some government-insured loans require 3.5 percent down or zero down, in some cases. Plus, check with your local or state housing programs to see if you qualify for housing assistance programs designed for first-time buyers.
Unicorns do not exist in real estate, and finding the perfect property is like finding a needle in a haystack. Looking for perfection can narrow your choices too much, and you might pass over solid contenders in the hopes that something better will come along. But this type of thinking can sabotage your search, says James D’Astice, a real estate agent with Compass in Chicago.
How this affects you: Looking for perfection might limit your real estate search or lead to you overpaying for a home. It can also take longer to find a home.
What to do instead: Keep an open mind about what’s on the market and be willing to put in some sweat equity, DiBugnara says. Some loan programs let you roll the cost of repairs into your mortgage, too, he adds.
First-time buyers might be cash-strapped in this environment of rising home prices. And if you have little saved for a down payment or your credit isn’t stellar, you might have a hard time qualifying for a conventional loan.
How this affects you: You might assume you have no financing options and delay your home search.
What to do instead: Look into one of the three government-insured loan programs backed by the Federal Housing Administration (FHA loans), U.S. Department of Veterans Affairs (VA loans) and U.S Department of Agriculture (USDA loans). Here’s a brief overview of each:
FHA loans require just 3.5 percent down with a minimum 580 credit score. FHA loans can fill the gap for borrowers who don’t have top-notch credit or little money saved up. The major drawback to these loans, though, is mandatory mortgage insurance, paid both annually and upfront at closing.
VA loans are backed by the VA for eligible active-duty and veteran military service members and their spouses. These loans don’t require a down payment, but some borrowers may pay a funding fee. VA loans are offered through private lenders, and come with a cap on lender fees to keep borrowing costs affordable.
USDA loans help moderate- to low-income borrowers buy homes in rural areas. You must purchase a home in a USDA-eligible area and meet certain income limits to qualify. Some USDA loans do not require a down payment for eligible borrowers with low incomes.
If you had sticker shock from seeing your new monthly principal and interest payment, wait until you add up the other costs of owning a home. As a new homeowner, you’ll pay for property taxes, mortgage insurance, homeowners insurance, hazard insurance, repairs, maintenance and utilities, to name a few.
How this affects you: A Bankrate.com survey found that the average homeowner pays $2,000 annually on maintenance services. Not having enough cushion in your monthly budget — or a healthy rainy day fund — can quickly put you in the red if you’re not prepared.
What to do instead: Your agent or lender can help you crunch numbers on taxes, mortgage insurance and utility bills. Shop around for insurance coverage to get compare quotes. Finally, aim to set aside at least 1 percent to 3 percent of the home’s purchase price annually for repairs and maintenance expenses.
Many loan programs allow you to use a gift from a family, friend, employer or charity toward your down payment. Not sorting who will provide this money and when, though, can throw a wrench into a loan approval.
How this affects you: “The time to confirm that the Bank of Mom and Dad is ready, willing and able to provide you with help for your down payment is before you start home shopping,” says Dana Scanlon, a Realtor with Keller Williams Capital Properties in Bethesda, Maryland. “If a buyer ratifies a contract to purchase a home with an understanding that they will be getting gift money, and the gift money fails to materialize, they can lose their earnest money deposit.”
What to do instead: Have a frank discussion with anyone who offers money as a gift toward your down payment about how much they are offering and when you’ll receive the money. Make a copy of the check or electronic transfer showing how and when the money traded hands from the gift donor to you. Lenders will verify this through bank statements and a signed gift letter.
The concept of homebuyer rebates, also known as commission rebates, is an obscure one to most first-time buyers. This is a rebate of up to 1 percent of the home’s sales price, and it comes out of the buyer agent’s commission, says Ben Mizes, founder and CEO of Clever Real Estate based in St. Louis.
How this affects you: Homebuyer rebates are available in most U.S. states, but not all. Ten states prohibit homebuyer rebates: Alaska, Alabama, Iowa, Kansas, Louisiana, Mississippi, Missouri, Oklahoma, Oregon and Tennessee.
What to do instead: If you live in a state that allows homebuyer rebates, see if your agent is willing to provide this rebate at closing. On a $300,000 home purchase, this can be a $3,000 savings for you so it’s worth asking.
Source: Deborah Kearns https://www.bankrate.com/real-estate/first-time-homebuyer-mistakes/
Enhance Your Home’s Showing Appeal
To enhance the perception, use the following list as a guide to maximize the benefits of your home.
(Space, access, roominess, condition)
Outside Your Home
– Inside Your Home
– Cut & edge the lawn weekly for a finished appearance
– Trim all shrubbery & remove low-lying tree limbs
– Plant flowers in your front yard
– Fertilize your lawn to make your grass look lush & green
Inside Your Home
– Cut & edge the lawn weekly for a finished appearance
– Trim all shrubbery & remove low-lying tree limbs
– Plant flowers in your front yard
– Fertilize your lawn to make your grass look lush & green
– Store out of season clothes so the closets don’t have a cluttered look
– Remove items from the floors of walk-in closets so the prospects can have easy access
– Avoid too many appliances on the kitchen counter, put as many as you can away to expose maximum counter space
– Pre-pack items which may clutter your home. Extra toys in your child’s room & knick-knacks may actually make your rooms appear smaller
– Clean your home from top to bottom
– Take down any family pictures so your potential buyer can visualize themselves there
Prior To Every Showing
– Let the light in. Raise shades, open blinds & pull back curtains. Bright, open rooms feel larger and more inviting
– Let fresh air in & open windows if weather permits
– Place a deodorizer in rooms where needed. Fresh flowers can be used to your advantage. Fresh baked bread & cinnamon also attracts positive attention
– Send pets away or secure them away from the house
– Clean out your sinks of all dishes & drain plugs
– Clean tub of all toys, bath products & make sure shower curtain is closed
– Clean mirrors and glass shower doors of all wet spots
– Take out trash & empty any diaper pails to rid the house of potential foul smells
– The house should be a comfortable temperature: cool in summer & warm in winter
– Freshly vacuum/mop all floors where needed
– Make all beds
– Fluff pillows on couches and beds
– Make sure all surfaces are clean & dust free
– Make sure the lawn is free of weeds & mowed if necessary
– Make sure the lawn is free of any pet debris or kid toys
– Tidy the insides of your cabinets so potential buyers can inspect the storage space
We hope these tips have been helpful to you in answering any questions you may have had. As always, please do not hesitate to contact your closer should you have any questions.
Thank you for allowing us to be a part of this transaction.
If you are thinking about selling your home, one of the top things to think about is staging it. When you have your home staged and decluttered, it gives the potential buyer the opportunity to visualize themselves and their furniture in their future home. This video shows the difference staging does make in the before staging and after staging shots.
You have decluttered, cleaned and done little touch-ups here and there. Now, how do your keep your home looking show ready.
Here is a great post from Realtor.com that hits on a few quick cleaning hacks to help you be prepared for that unexpected showing.
When you’re selling your home, you must be ready for people to pop in at a moment’s notice. And no, it’s not like when your neighbor drops by to ask you to water her plants while she’s on vacation, and leaves in five minutes without noticing how many dishes are stacked in your sink or the layer of dust on your coffee table.
Nope, these people will scrutinize. And they will judge. But you’re still living in your home—how do you keep it clean enough to make a good impression, no matter the time or day?
It turns out you don’t have to hire a live-in housekeeper, and your life doesn’t need to come to a screeching halt just because you’re showing your house. Try these hacks to get the job done quickly and easily, so you can free up your time—and save your sanity.
Half of my cleaning problems come from not knowing where to start. I walk into a room, picture myself trying to clean all the things at once, get overwhelmed, and suddenly feel the urge to sit down for a while. Apparently I’m doing it wrong (no big surprise there).
But if you know how to work the room, cleaning will go much faster.
“Then focus on the top eye-catcher places and things like floors, ovens, and bathroom [fixtures],” she says.
While your instinct might be to clean everything, you might also go crazy trying to pull it off before every showing. Instead, zero in on what the potential buyer is likely to notice, Haynes recommends—cleaning it every day or two, and then doing a deeper clean once a week.
As soon as you know you’re going to show your house, pack up everything you don’t normally use.
“Remove all the nonfunctional stuff or things which don’t contribute to the overall look of the property,” Haynes says. It’ll feel weird to live like that at first, but the more stuff you have, the more stuff you have to clean.
Once you’re down to the stuff you actually need, find a way to quickly and easily hide it when it’s time to show the house.
“When we had a viewing on short notice, we used plastic and cardboard boxes where we stored our belongings,” says Harriet Jones, supervisor for Go Cleaners London. “Pick a box with a different color for each room so you can find and return those items to the respective rooms easier. You can place the boxes in the garage during the viewing.”
Sure, it might take a lifetime to actually develop good habits, but you can always fake it until you sell your house.
By taking small steps throughout the day, you’ll save yourself a ton of time and keep the house clean around the clock. In the living room, pick up as you go (or at least as soon as your kids leave the room). In the bathroom, make it a habit to keep your toiletries under the sink and not on the counter. In the kitchen, unload the dishwasher as soon as the drying cycle is done so you can start loading again right away.
Granted, it probably won’t go perfectly smoothly (especially if you have kids), but every little bit helps.
Running short on time? You can easily make a room look clean without actually having to clean everything—as long as you focus on the stuff people notice the most.
Focus most of your effort on two rooms: the kitchen and the bathroom, Jones recommends.
“Countertops should be free and clear of clutter, and clean,” she says. “Same applies to your refrigerator’s door and your floor. Make sure your shower and tub are clean and neat. Tiles and floor should be sparkling.”
If you have time, give rooms an extra boost by wiping down the fixtures and faucets, running a dry mop over the floors, and dusting the window treatments. Fold white towels neatly on the towel rack in the bathroom for a classic look.
Don’t forget those little touches that make your house look clean and presentable. Throughout the home, create inviting sitting areas and intimate spaces. In the bedroom, make sure the bed is made evenly every day—lumps and wrinkles in the comforter can make the whole room look messy. Put out a bottle of wine and a couple of wineglasses in the master bedroom or living room. And in the kitchen, add a bowl of fruit or a vase of flowers to the countertops to give a touch of color and freshness.
You don’t want to do too much—or you’ll be heading back into clutter territory—but a few little touches here and there can create a scene charming enough that no one will notice the spots you forgot to clean.
Source: Angela Colley – https://www.realtor.com/advice/sell/cleaning-hacks-show-ready-selling/
Building a 5-acre deck park over a recessed eight-lane freeway took an imaginative and hard-working team of Dallas leaders with a clear vision.
Have you thought about the possible legal considerations regarding the listings you may have that have audio or video devices? Here is a great article written by Wes Bearden that touches on those issues.
Selling a home can be frustrating to homeowners. They’re asked to allow strangers into their home. They may never receive feedback and are left to wonder, “Why didn’t that last buyer bite?” What do anxious sellers do? They get an extra set of ears. Many homeowners have installed security cameras and smart-home devices. These installations can be an ultra high-tech security system or a simple baby monitor, and they all can be abused. A number of notable cases have emerged where sellers listened to a potential buyer’s showing. Sometimes it’s to gain advantage in negotiations, while other times it’s simply to better stage the property. So, can a seller covertly record or monitor a buyer’s showing?
Both the Federal Electronic Communications Privacy Act (ECPA) and Section 16.02 of the Texas Penal Code prohibit audio recordings without the consent of at least one individual who is part of the conversation. The Texas rule, commonly referred to as the one-party rule, requires at least one party to consent to recording conversations. What that rule allows is any individual to covertly-and legally-record his own conversations with a broker, neighbor, or other party. Whenever you speak, it’s best to follow the old saying: Say what you mean and mean what you say. The other person in the conversation may be recording everyone.
If a seller is not present and participating in the showing, he cannot record audio … even if the conversation happens inside the seller’s home.
Texas law does not allow audio recording or audio monitoring of conversations that you are not a part of. If the seller is not present and participating in the showing, he cannot record it. Even though the conversation happens inside a seller’s home, he is prohibited from recording any conversations that he is not a part of.
Many homes today have security cameras installed that record video. Some have audio recording, similar to a baby monitor, and some without. The ECPA docs not prohibit video recording. In fact, silent video-like from security cameras-is generally allowed as long as it isn’t in an area where an individual would have a reasonable expectation of privacy. For instance, silent bathroom video recording is not allowed. But silent video recording of the foyer, kid’s playroom, exterior of a home, and a garage arc likely permitted.
Most professional alarm and security cam-era installers are familiar with the law. Normally, they install video cameras with-out audio and arc leery to place inside cam-eras in any location other than a foyer. However, when your seller is a do-it-yourselfer, you may want to ask questions. Have sellers tell you what the system will record. If audio is recorded, the seller may have a problem. If it is silent video, have sellers show you where the cameras are located. Make sure they aren’t video recording in a private area, such as a bathroom. Courts have traditionally upheld individual privacy rights over the property rights in a residential home. Consider limiting the use of cameras to the exterior of the residence. Violating state and federal recording laws can involve criminal penalties.
ln addition, Texas, like many states, recognizes several types of common law invasion of privacy claims. At its essence, invasion of privacy protects a person against unreasonable intrusion upon his seclusion, solitude, or private affairs. Even though recording may be in the seller’s house, courts have found that a visiting party can have a valid claim when the homeowner overreaches.
Illegal recording is a felony offense in Texas, and anyone who has been recorded in violation of the law can bring a civil suit to recover $10,000 for each occurrence, actual damages in excess of$10,000, punitive damages, attorney’s fees, and court costs.
Help your sellers avoid criminal or civil liability by encouraging them to concentrate on feedback given with consent and leave the mics and hidden cameras out.
Help your buyers be smart about surveillance
Don’t be too paranoid. Be security smart, but don’t let it ruin your real purpose to be at the house.
The information contained herein first appeared in the November 2017 edition of Texas REALTOR® Magazine and is being reprinted with the permission of Texas REALTOR® magazine and the author, Wes Bearden.
Please click here for a printable version of this great resource.