A question came in from a viewer this week asking, “Can we reject an offer because the buyer is obtaining financing from the VA?”
You are able to reject an offer from anyone, but why would you want to reject an offer from a veteran? The VA is offering mortgage financing for our veterans and rates and terms are extremely attractive for our veterans. In some cases they are lending up to 100% of the value of the home. If they are receiving 100% financing, that does not make them a weak buyer. It makes the veteran a strong person who is receiving wonderful benefits as they should.
Another misconception is that the appraisal will be difficult. The appraiser will simply be protecting the veteran as they do not want them to get swindled.
Have pride when selling you home. Your home should be in its best condition when it is put on the market. If you’re selling your home and there is something wrong with it, you may want to fix issues that are likely to attract the attention of a VA appraiser and other buyers. You should feel great about selling your home to a veteran!
If you have any questions about selling your home, contact Stiles Law by calling (781) 319-1900.
We received another question from a viewer this week, “I’m selling my home. What costs should I expect to pay?”
The biggest cost a seller should expect when selling their home is the payoff of the mortgage. When notified of an upcoming sale, the mortgage lender will provide a written payoff and this payoff will identify the exact amount that is owed to pay the loan in full. The lender will calculate all outstanding principal, accrued interest, in addition to all other fees and costs.
In addition to the mortgage payoff, sellers should expect the cost of the real estate broker’s commission, ancillary recording costs, tracking and any adjustments for condo fees, fuel, or real estate taxes.
One thing people tend to forget about when selling their home are the Deed Stamps. Deed Stamps are an excise tax and in Massachusetts they are calculated by $4.56 per $1000 of the sale price (except Barnstable County which charges $6.12 per $1000 of the sale price). For example, a home that sells for $500,000 will result in a tax of $2,280.
If you have any questions about selling your home and or your payoff, contact Stiles Law by calling (781) 319-1900.
We received another question from a viewer this week: “Why is my payoff so high?” When selling a home, the seller’s mortgage payoff may seem higher than expected. Sellers are often surprised because they are expecting a figure close to their most recent principal balance.
When notified of an upcoming sale, the mortgage lender will provide a written payoff. The payoff will identify the exact amount that is owed to pay the loan in full. The lender will calculate all outstanding principal, accrued interest, in addition to all other fees and costs due.
Sellers may be familiar with the principal balance shown online or in their last mortgage statement which is only a portion of what is due. For example, the mortgage payment due on November 1 includes the principal and accrued interest in October. The payment includes the interest from October 1 through October 31. If the closing is on November 15 and the payment that was due on November 1 was not paid, the total payoff will be the interest from October 1 through November 15 plus all outstanding principal. If the November 1 payment was made, the payoff will include the principal balance with interest from November 1 through November 15.
Typically, a small cushion is added to the payoff to account for possible delays in processing payment. For example, if the closing occurs on November 15, interest may be collected through November 18. The lender will reimburse the borrower for any overpayment. The payoff usually does not account for funds held in the borrower’s escrow account. In most cases, funds held in escrow for insurance and taxes will be disbursed to the seller within thirty days after the mortgage is paid off.
If you have any questions about selling your home and or your payoff, contact Stiles Law by calling (781) 319-1900.
Another question came in from one of our viewers this week “What happens if I’m under contract to purchase a home and I simply get cold feet?”
In short: it depends. The answer is determined by Massachusetts law. Hopefully you are not relying on your lender’s attorney who reviewed you purchase and sale agreement as a convenience. You will need your own attorney who can guide and counsel you through this process. You are now potentially in litigation and could forfeit your entire deposit.
Taking a step back, it is important that we recognize how you may have gotten to the point of “cold feet.” Buying a house is a major investment. The market is volatile and with its highs and lows is exciting. Although exciting, it is important that you do not become intoxicated by the whirlwind of buying a house.
Be certain when purchasing a home. Educate yourself as a buyer before beginning such a serious process. Find an attorney that will represent your best interest and not just the bank’s. It will be their goal to lead you to a successful conclusion.
From the seller’s perspective, it is not a good idea to be testing the market without an actual intention to sell. With the market being so active at times, you may think to yourself that you could potentially get a lot for your house. When you are not sure you are ready to move, but put your house on the market anyway, you are wasting everyone’s time, including your real estate professional’s. Ultimately this could lead to being sued by the buyer.
If you have any questions about selling your home, contact Stiles Law by calling (781) 319-1900.
We received another question from a viewer this week asking, “What is the MLC?” MLC is an acronym that is used frequently in real estate law for Municipal Lien Certificate.
While performing due diligence before purchasing a home, buyers should verify that real estate taxes are paid. The MLC is delivered by the city or town and is their way of certifying to the buyer that real estate taxes and other municipal charges against the property are paid.
The MLC will include the location and the current owner, the due date of the tax payments, the annual amount of real estate taxes and other municipal charges, and whether taxes are due quarterly or semi-annually. Most importantly, the MLC will state how much is due to pay all outstanding taxes and charges.
Usually, the closing attorney will order this MLC. The city or town charges a small fee before issuing the certificate. The closing attorney will have the MLC recorded with the registry of deeds. Recording the MLC should prevent a city or town from claiming any taxes not disclosed on the MLC are due against the property.
If you have any questions about selling your home, contact Stiles Law by calling (781) 319-1900.
