Real Property law - continued

Scheduling and coordinating a closing requires cooperation between the purchaser’s and seller’s attorneys, the lender’s attorney, the title company, the lender, the realtors and the parties (i.e. sellers and/or purchasers). Because The Randall Law Firm has agreed to handle the closing for a flat fee and not on an hourly basis, the client understands and agrees that he or she will receive communication from the Law Firm concerning only those items that significantly and directly affect the client’s legal interests. In the event the Law Firm determines that it is expending an unusual and unanticipated amount of time on this file, it shall be entitled to terminate this retainer agreement or, in its own discretion and with the client’s consent, change the reimbursement arrangement to a billable hourly basis at the Law Firm’s usual and customary hourly rate.

If you need legal assistance involving real property law in new york state or New York real estate law, contact a Albany Real Estate lawyer now!

DEADLINE DATES:
Structural Inspection and Mortgage Commitment must be completed before the dates indicated in your contract. (Paragraph 6 and 10 of the Capital Region Multiple Listing Service, Standard Form). These dates are very important. You must contact us before these dates and advise us as to the status of each one individually.

STRUCTURAL INSPECTIONS: The contract defines a substantial structural defect as an individual defect which will reasonably cost $1,500 to correct. Estimates are obtained by the Purchaser to confirm that the cost of repair of an individual item will exceed $1,500.

MORTGAGE COMMITMENT: When the lender finally approves the Borrower’s loan, they issue a Commitment Letter to the Borrower which they ask the Borrower to sign and return. This obligates them to make the loan and sets forth certain requirements they have to comply with in order to close. In order to better represent you, we need a copy of the Commitment Letter.

CLOSING DATE: Unless your contract has a clause that “time is of the essence”, the date of closing is merely an approximation. Do not schedule movers or terminate/set up utilities based on the assumption that you will close on the date set forth in your contract. It is not uncommon to close within a week or two of your projected closing date. If you must close on a specific date, you must advise us of this before the attorney approval period expires so that we can address it in the contract.

CLOSING FIGURES AND CERTIFIED FUNDS: The Purchaser’s Lender has expenses and fees that it deducts from the Purchaser’s loan proceeds, such as setting up a tax escrow account, bank attorney legal fees, interim interest, document preparation fees and title insurance for the bank. Most, but not all, of these items are itemized on the lender’s good faith estimate, which is received by the purchaser when he or she first applies for his or her loan. At that time they are only estimates. The actual final charges are not known until a closing date has been set and the lender prepares its HUD-1 and forwards it to The Randall Law Firm. As your attorney, we are supposed to receive this information the day before the closing. However, frequently we do not receive it until the day of the closing. The Randall Law Firm cannot advise the client what funds are needed to bring to the closing until after it has reviewed the HUD-1 forwarded by the lender’s attorney. We will use our best efforts to obtain this information as far in advance of the closing as possible. We will then advise the Client of the amount of funds they will need to bring to the closing. It is customary that no more than $1,000.00 shall be in the form of a personal check and that any larger amounts shall be in the form of a cashier’s check or certified check made payable to the client. This check will be endorsed over to the Seller by the client at the closing.

HOMEOWNER’S INSURANCE: The purchaser must obtain a Homeowner’s Insurance Policy naming the lender as the first mortgagee exactly as set forth in the lender’s Commitment Letter. It is recommended that the Purchaser present its commitment letter to its Insurer so that they get the name and coverage correct. The purchaser must bring the binder to the closing with a one year paid receipt.

TITLE INSURANCE: Robert G. Randall, Jr. is an examining counsel for Chicago and Fidelity Title Insurance Companies and conduct business as an Examining Counsel under the name of A-1 TITLE. The Title Insurance Company, not the client, pays the Randalls for the services they render as an examining counsel. Title Insurance rates are fixed by the New York State Insurance Department and must be uniformly charged by all title companies (i.e., it costs you the same wherever you purchase it). The fee is paid by the client to the Title Insurance Company once and lasts for as long as the client owns the property and for certain claims made after the party’s sale. If purchased, the title company defends the title, pays the legal fees of defending the claim and if there is a loss, pays the client their equity in the property. There are two (2) different kinds of title insurance policies. One insures the interests of the Lender, known as the Mortgagee Title Insurance Policy. The other insures the Purchaser, known as the Fee Title Insurance Policy. The Insurance Department requires a significant price reduction (70%) when both policies are purchased simultaneously. Since the lender requires the purchaser to purchase a Mortgagee Title Insurance Policy insuring the lender’s interest at the closing we recommend that the purchaser purchase the Fee Policy, if they want it, at the same time in order to take advantage of the cost savings. Prior to the closing, we forward a brochure that explains the insurance in greater detail. Some of the most common instances of risks protected by an Owner’s Title Insurance Policy are: false impersonation of the owner of the property; forged deeds, releases or wills; undisclosed or missing heirs; instruments executed pursuant to an expired or otherwise invalid or revoked power of attorney; mistakes in recording legal documents; misinterpretations of wills; deeds by persons of unsound mind, minors or persons allegedly single but actually married and liens for unpaid taxes (either gift, inheritance or income taxes).

SURVEY: We recommend that Purchasers have the property surveyed. Title Insurance omits coverage for anything that a survey would show. Surveys show the location of easements and any encroachments onto or off of the property. If a survey shows any of these problems, we can request that the Seller correct them. Otherwise, the Purchaser purchases the property subject to those problems.

If you need legal assistance involving real property law in new york state or New York real estate law, contact a Albany Real Estate lawyer now!