Dallas Real Estate and Title Insurance Policies

What is Title Insurance and why do I need it when buying Dallas real estate? To understand title insurance, let's look at what is known as "chain of title" and how title companies search public records. Title searches begin with when the US government claimed the land using a U. S. patent and moving forward from that point. Because people are involved in recording deed transfers and plotting land parcels, a lot of mistakes can happen. You want title insurance because it will protect you against these defects and "people errors".

Public Records and Property Searches

• County records are often maintained at local courthouses or the Clerk of Registrars.
• Property transfers were first recorded alphabetically in separate Grantee and Grantor books.
• Today, most records are stored in computer files.
• Dallas foreclosures will also be shown in the public records.

Land Division

• Early deeds involved large chunks of land known as Townships.
• Townships contain 36 sections and are six miles by six miles.
• Sections measure one mile by one mile and contain 640 acres.
• Half of a section is 320 acres.
• 1/4 of a section is 160 acres.
• 1/4 section of 1/4 section is 40 acres.
• An acre is 43,560 square feet

Basic Title Search

• Title searches start with the most recent deed, searching the grantee's name backwards in time, until the deed when the grantee acquired the property is located.
• That grantor's name is then searched backwards in time in the grantee's book to find when the grantor acquired title as a grantee.
• This process continues and the property description involves larger and larger parcels of land.
• Eventually, the searcher gets to the U. S. Patent.
• You can learn more about Title Searches by visiting popular Dallas real estate blogs.

Factors That Affect Title

As we discussed deeds establish a chain of title, but sometimes these chains get broken. Title searchers also look for reconveyances, easements, rights-of-way and other elements affecting title to the property. Here are more records that are searched to piece title together:

• Tax sales
• Death certificates
• Marriage records

Title Insurance Coverage

Depending on the title company, consumers can choose among a variety of options, but the top three choices are Owners, Lender's and Extended Coverage.

• Lender's Title Policy Coverage:

1. Unrecorded easements and access rights
2. Mechanic's liens and unrecorded liens
3. Defects and other unrecorded documents

• Owner's Title Policy Coverage:

1. Defective recordation
2. Clear title to the property
3. Incorrect signatures on documents
4. Forgery, fraud
5. Restrictive covenants
6. Encumbrances or judgments

• Owner's Coverage - Extended

1. Structure damage from mineral extractions
2. Building permit violations from previous owners
3. Subdivision maps
4. Covenant violations from previous owners
5. Variety of encroachments and forgeries after title insurance is issued

Who Pays For the Title Policy Insurance Policy?

• This can differ from county to county, but it is negotiable in the offer to purchase.
• Sellers and buyers split the fee for the owner's policy.
• Generally, the buyer pays for the lender's coverage.

How Long Are Title Insurance Policies Good For?

The simple answer is, forever. If you are planning to resell the property within a few years, ask your title company about what is known as "binder" coverage. Most title companies will sell you a binder policy for an additional 10% premium. Binder coverage is good for two years, often can be extended beyond that time, and the fee charged for the new buyer's policy will be the difference between what you bought the property for and the price at which it sold. You will get a credit for the amount of coverage you purchased under your own Owner's Title policy.

 

How Often Are Title Policy Insurance Premiums Paid?

This is a onetime premium due when you buy. You will never have to pay an additional premium on this policy. Title policy insurance is the best insurance policy a Dallas real estate owner can ever buy.

County Real Estate Markets - Hot, Cold, Neutral

When most people decide to sell or buy a home in the County, very few stop to look at the marketplace to see if the market is conducive to their home selling goals. This is probably because most people tend to think of their home as a place to live and not as an asset, an investment.

Neutral Real Estate Markets

These neutral markets are balanced. Generally, interest rates for Tarrant County Homes are low and affordable and the number of buyers and sellers in the marketplace are about equal. The scales don't move quickly in either direction, meaning the market is normal without experiencing volatile swings.

 

Signs of a Neutral Market

• Three to six months of inventory is on the market.
• Inventory is normal as compared to previous normal months.
• Comparable sale prices are close to active listing prices.
• Sales numbers are stabilized.
• Median sales prices are even.
• For Sale signs are replaced with pending or sold signs within 30 to 45 days.

Real Estate Markets - Buyers

If you are a looking to a purchase Collin County Homes or Denton County Homes in a buyer's market this is the best financial market in which to buy. This is because there are more homes available for sale than buyers to purchase all of the homes. Buyers have many more homes to choose from, which increases the odds a buyer will find their perfect home. In slow real estate markets, serious sellers are often ready and willing to negotiate. This means you can probably buy a home for less than the list price, and the seller might be willing to pay some or all of your closing costs.

Signs of a Buyer's Market

• Comparable sale prices are higher than active listing prices.
• Inventory is high as compared to previous months.
• More than six months of inventory is currently on the market.
• Fewer buyers are purchasing, resulting in lower closed sale numbers.
• Median sales prices are declining.
• For Sale signs are staying up longer, resulting in longer "Days on Market".

How to Determine the Months of Inventory

1. Find the total number of sold or closed transactions for last month.
2. Find the total number of active listings on the market last month.
3. Divide the number of total listings by the number of total sales, which results in the number of months of inventory remaining.

As an example, in a buyer's market, there were 3,563 listings available over a given 30 day period. During that time period, 2,134 sales closed. That leaves 7.5 months of inventory remaining on the market, making that marketplace a buyer's market.

 

Seller's Real Estate Markets

If you are a home owner who wants or has to sell a house in a seller's real estate market, this is the best financial market in which to sell. This is because there are more home buyers than available homes. In a strong real estate market often times serious buyers are often willing to pay more than list price. This means you should be able to sell your home quickly and possibly for more than you ask for it.

 

Signs of a Seller's Market

• Comparable sale prices are lower than active listing prices.
• Median sales prices are increasing.
• Inventory is very low as compared to previous months.
• Less than six months of inventory is on the market.
• More buyers are purchasing, resulting in higher closed sale numbers.
• For Sale signs are up for a few days before a pending or sold sign is attached.

Walking Away From a DFW Real Estate Closing

Buyers walking away from DFW home closing happens more often in buyers markets. This is because in buyer's markets, when prices are soft, some buyers get scared when they should be excited. Many of them are afraid of further declining home values in the market. Generally, the fear begins to creep in right after the purchase offer is accepted and then it begins to build. By the time full blown panic sets in, it's usually a day or two before closing.

 

Home Sellers Who Walk Away From Closing

It's rare that a DFW real estate or Plano real estate seller walks away from closing. In most cases if sellers are going to get sellers remorse it will typically happen upon offer presentation, when the reality of actually selling sets in. Although, I know of a seller who bought another home and shortly thereafter changed her mind. He had moved out of his existing home and into his new home before his first home closed. Within a couple of days of settling into his new place, he decided to terminate the sale of his first home and move back home. Of course, by then she ended up owning two homes.

 

 

Home Buyers Who Walk Away From Closing

Well written purchase offers typically contain one or more contract contingencies that must be removed within a certain period of time. The time to walk away from closing or cancel a contract for most home buyers is in this contingency period. Buyers who walk away at the last minute often do so for one or more of the below reasons. When a buyer walks away some of these sellers will utilize the services of a We Buy Houses company to get their house sold.

 

 

· Mortgage Financing.
Even though mortgage lenders may have issued a pre-approval letter, it doesn't mean the lender will actually give the buyers a mortgage. After the loan contingencies are removed, buyers may face underwriter stipulations that they cannot perform or overcome. An experienced loan officer can foresee many conditions for loan approval and fix them in advance, but alas, some loan officers are inept.

· They Get Cold feet.
Sometimes, buyers who feel remorseful toward the end of the transaction probably should not buy the home because the pressures of homeownership may be to great for them to handle. These types of buyers might be better off renting a home.

· They Found another home.
The grass seems to always be greener on the other side. Once a buyer has committed to buying a home, he or she may keep looking at other homes and before you know it, another home turns into that dream home. Which means goodbye to the first dream home and hello to the second one.

· Change in Their Lifestyle.
Unexpected job transfers, a sudden pay cut, divorce. Any of these circumstances can cause buyers to change their minds about closing the purchase. Sometimes medical emergencies can also cause buyers to cancel the transaction.

· Natural Disasters.
Mother Nature is unpredictable. The house itself could be destroyed in a tornado, hurricane, earthquake or flood; any number of natural disasters can cause havoc, rendering a home inhabitable. Even a hard rain storm could cause trees to uproot themselves and crash into a home. Most buyers under these types of circumstances simply would walk away. But they will also walk away if their repair request are not completed or something else goes wrong with the house, which they might uncover during their final walk through inspection.

 

 

After Walking Away From Closing - Repercussions

Unfortunately, once buyers have are past their contingencies in the contract, their earnest money is at risk. Many contracts call for liquidated damages in the event of a default. Without a liquidated damages clause, a seller may be free to sue for actual damages, which could exceed the deposit. Earnest money deposits are negotiable. It is not that unusual for a seller to accept $2,500 as a deposit on a $450,000 home, however, the higher the deposit, the more money the buyer has at risk under a liquidated damages clause. Buyers who don't care about closing and want to walk away will often forfeit their earnest money deposit. If it's only a $2,500, in the overall scheme of things, that amount may not be substantial enough to a buyer to force the buyer to follow through and close. If both parties have previously agreed to liquidated damages, the money the seller receives for the buyer's default could be limited to the actual deposit on hand. For more advice, please consult a competent real estate attorney.

Will a Virtual Tour Sell DFW Real Estate?

A virtual tour itself will not sell DFW real estate but then why would you want to include a virtual tour in your real estate marketing efforts? According to Dallas Realtors prospective home buyers are looking online for both photos and virtual tours.

 

How Does a Virtual Tour Work?

Without actually visiting the home virtual tours take you inside the home and give you a 360-degree view. Some of them are interactive, meaning you click the mouse and it takes you to the ceiling, the floor, the walls, leaving no inch of the room unviewed. Others virtual tours are flat-screen views put together to give you a moving image that you watch but do not control. Whether you are selling Plano real estate of any DFW real estate the virtual tours will work and cost about the same.

You can order virtual tours a number of ways:

• Hire professionals to take the photos, upload and create the virtual tour.
• Take your own photographs and hire a professional to simply upload and assemble them for you.
• Buy your own software and do it yourself.

What Does a Virtual Tour Cost?

• Larger numbers of spins are usually reserved for the homes listed at more than a million dollars. Buyers want to see the entire property including the guest house, the libraries, the wine cellars, the indoor pool & spa facilities, media rooms, gyms, studios and garages. Cost: Fees vary from $250 on the lower end and up to $3,000 for professional Web sites dedicated to the property.
• Every virtual tour should consist of a minimum of two spins. Even a small 1000-square foot home can be shot on a two-spin tour: the living room and the clubhouse / pool area, for example. Cost: Less than $150.
• These are suitable for larger homes of approximately 2,500 sq. ft. or more and priced at less than a million. The number of rooms or areas that you select to feature will depend on the layout, number of stories and curb appeal. Cost: $250 or less. Interactive virtual tours will cost a little more.

Staging for the Virtual Tour

• Consider the level of the camera. If you raised the camera a foot or so, would it eliminate glare from windows?
• Determine the viewpoints. Take your own digital photo and upload them to your computer and study each room for its appeal and photogenic qualities. Print out the photos you like and show the virtual tour professional the angles that you want.
• Begin the tour focused on the most interesting element in the space and end with that same element. Think about what the viewer will see first to determine your starting point for the tour. You don't want to begin filming a doorway, for example, because most doorways are boring.
• You want the space clean, open, clutter free and to appear much larger than it is. Move excess furniture out of the room you are shooting
• Choose the best spot in the room to stage the camera. While you might capture a wider range of view from a location closer to a hall or door, think about the entire circle of view and how interested your viewer will be staring at a close up of a nearby wall.

Added Features Available for Virtual Tours

• Use Descriptive Text: Most virtual tours provide plenty of space for the marketing description.
• Scrolling Text: Describe that moving video with text that rolls across the screen. Don't rely on the viewer to know enough to scroll down the page to your verbiage. Add a line of verbiage directly to the video.
• Add Audio: Some virtual tours give you the option of adding your voice to the tour. Be enthusiastic, speak clearly, and remember to smile, like you were talking to a friend, because a smile resonates in the voice.

Multiple Offers – The Best Strategies

In many of the stronger real estate markets in the country we are seeing an influx of multiple offer transactions. This is how it usually goes. You have been house hunting for weeks and you notice one home has been for sale for five months without any offers. You figure that the home must be overpriced but you go look at it anyway. You fall in love with the home. It's the perfect home for you, and you figure you can get a great price because the seller is must be desperate for an offer by now. You write an offer on it and then your Realtor delivers the offer to the seller's agent. That night all you do is dream about the home thinking about how you will arrange your furniture and which colors you will paint the rooms. The very next morning your agent calls to say the house has been sold to somebody else.

 

How is this possible? You're surprised, angry and depressed. You wonder if the seller had a buyer in his back pocket all along. Did you get deceived? You were not. What generally happens, and no one can seem to explain why, is the minute you want to buy a home, so do three other people. It's common for the seller of an overpriced, dated and neglected listing to suddenly receive two, three offers, all on the same day.

A great tip from Collin County Realtors and Denton County Realtors: When you the right home to buy, write your offer immediately. Ask your agent to call the seller's agent to find out if whether or not anybody else might be writing an offer.

 

 

Handling Multiple Offers in Seller's Markets

Many times home buyers wonder if it's worth trying to compete against other buyers when sellers market conditions exist. When there is very little inventory on the market, it's not unusual for a seller to receive a half dozen offers. It's always a good idea to write an offer anyway. Here are tips from Tarrant County Realtors to make your purchase offer outshine the rest:

• Write Your Very Best Offer.

Don't put yourself in a negotiation situation from the start. Offer your highest price and make it attractive, maybe a bit above list price. Ask your Realtor for a CMA on the home to determine its value. Sometimes sellers deliberately set a price below comparable sales in an effort to generate multiple offers, so paying a little extra doesn't necessarily mean you are paying over the home's value.

• Attach a Large Earnest Money Deposit.

Pending home sales can fall apart. Many sellers are worried that once they commit to an offer, the buyers may back out of the transaction after all the other buyers have disappeared. The earnest money deposit is part of your down payment. By increasing the deposit above the norm, you are showing the seller you are serious about closing this transacting. You're only offering the seller a little more money a little sooner but it speaks volumes.

• Prove to the Sellers You Are Qualified.

Almost every offer in a multiple offer situation will be accompanied by a lender letter. To stand out, ask your lender for a mortgage pre-approval letter, which is different than a prequalified letter. Being preapproved makes you a stronger buyer.

• Give the Sellers Enough Time to Move.

Possession is often a point of contention. It's hard juggle dual closings if you are selling and buying a home at the same time, and even more difficult if the sellers are doing the same. Give the sellers some slack by giving them two to three days to move out after closing, without expecting any compensation.

• Shorten or Waive Some Contingencies.

Always get a home inspection, but tighten up on the time period. If your loan is solid, waive the loan approval contingency. Talk to your agent about comparable sales to decide if you want to waive the appraisal contingency.

 

Multiple Offers in Buyer's Markets

In a buyer's market, the winning offer in a multiple offer situation is many times less than listing price. The number of multiple offers are generally considerably fewer, meaning you might be competing against one or two buyers not 10-15. Below are suggestions for competing:

• Find Out What Things Are Important to the Seller.

These could be seller requests or listing agent expectations. Ask what will seal the deal and then give it to them. Maybe it's a fast closing. Maybe it's a longer than usual escrow period.

• Sell Your Existing Home First.

If you have a home to sell, don't buy your next home without selling your existing room first. If you're a first time buyer, you may already have the advantage over a buyer who needs to sell before buying. If one offer contains a home sale contingency, the seller will be attracted to the offer without a contingency to sell.

• Be Nice.

Don't ask the seller to give you personal their items. Don't expect the seller to pay all your closing cost. Find out which charges are usually paid for by the seller and offer to pay a few such as escrow fees, title insurance policies, transfer fees, etc. Most sellers have an emotional attachment to their home and want to see it fall into the hands of an acceptable buyer. Be that acceptable buyer. Write the seller a brief letter explaining why you love the home and why you deserve to be chosen as the winning offer. .

• Prepare for a Counter Offer.

You can write your highest and best offer, and a competent listing agent is likely to still advise the seller to counter all the multiple offers, even in a buyer's market. The seller retains the right to choose or reject accepted multiple counter offers.

Dallas Real Estate Careers

Before You Sell Your DFW Home

When it comes time to sell your DFW home you may decide to sell it for sale by owner (FSBO), but you may find great benefit in listing it with one of the many professional DFW Realtors.  if you decided to use a Realtor, pay attention as you research the market place for the one that is the best fit for you.

Research Real Estate Agents and Firms

DFW Real Estate

Which brokerage firms rank at the top of major search engines for common search terms in your area? Like DFW Real Estate for example?

Which firm’s websites are the most appealing?

Which firms consistently feature virtual tours on their Listings?

Does the firm provide multiple photos of homes and in good quality?

Which firms advertise in multiple internet venues?  Which firms have a Dallas Real Estate Blog?

Ask your co-workers and friends for Realtor referrals. Maybe they have worked with an agent who did a great job?

Whether you are selling Dallas real estate or Plano real estate, once you have compiled a list of Realtors, set an appointment with each of them to learn more about their experience and services. Find out if these Realtors are willing to do a free comparative market analysis (CMA), a process that compares your home to similar homes that have recently sold. Realtors use this tool to help sellers set their listing prices.

Interviewing Realtors

Ask each Realtor that you interview to explain how they will market your house, including print, internet and other types of marketing.

Find out if the firm belongs to more than one MLS service. In some areas there's an overlap of regions, making multiple MLS memberships important.

Will the firm place your house in the MLS immediately making your home available to every possible Realtor greatly increasing your market exposure?

How much commission do they charge? How does it compare to that of other local firms that offer the same services?

What's the average length of time it takes to sell a house in your area?  Sometimes known as DOM for Days on Market. What is their company's average DOM?

Find out how long they want you to list with them.

How long has the listing Realtor been selling real estate?

What percentage of the firms listings sell during the initial listing contract period?

Buyer feedback is a very important tool. If every potential buyer makes the same negative comment, you should consider taking action to resolve the issue. How often can you expect to receive this feedback?

Will the agent hold an open house for other real estate agents? For potential buyers?

How are house showings handled? Will you receive advance notification that an agent is coming to show your house?  You can put restrictions on showings like certain days or times are off limits?  Keep in mind doing this may cut down on the number of times your house is shown.

If your new home will be in the same area, ask the agent any questions you may have as a buyer. You may choose to use the same Realtor to buy and sell.

If you have pets, make sure the Realtor is committed to a plan that ensures their safety. If it's a dog that bites, you will need a plan for buyer safety as well.

Does the firm use electronic security lockboxes? Many firms place a key inside a box that is secured to your home. Ask the Realtor to explain how it works.

Estimating Some Home Selling Costs

Ask the Realtors you are interviewing to give you an estimate of typical seller closing costs.

Ask how your share of property taxes for the year is calculated and prorated.

Ask about the amount of Attorney or other professional fees.

What will your share of property owner association fees (HOA) be?

What will be the total amount of the real estate commission?

Get a list of any other expenses that sellers are typically expected to pay, ie. inspections, surveys, certifications, pest inspections, etc.

Make sure to ask these Realtors any other questions that are important to you.  Your decision to hire a particular Realtor should be based in part on your gut feeling that the two of you can work together.  You don't need the biggest agency in town, the busiest agent, or the agent with the most experience. You need an agent who will market your home aggressively, to both buyers and other agents.