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: “Mark, I’m thinking about purchasing a home, but I really need to sell my home. Is it possible to do that?”
Yes, it is. With so many transactions occurring, it is very common that a buyer will make an offer to purchase real estate subject to selling their home first. Most sellers understand that most buyers cannot buy a new home without first selling their current home.
Buyers should be careful to make sure the language in the contingency is very clear. It is not unusual to see accepted offers with home sale contingencies that are unclear and do not protect the buyer.
We recommend drafting the contingency to include language similar to: “The purchase of [property] is specifically subject to the sale of [property] and the receipt of the proceeds from that sale.”
We often see contingencies that provide buyers with a certain amount of time to have their home under agreement. What happens if that transaction goes sour? We like to have a contingency that says the buyer’s obligation to purchase arises only if the buyer’s house has been sold and the proceeds have been received.
If you have any questions about a buying with a contingency, contact Stiles Law by calling (781) 319-1900.
We received another question from a viewer this week: “I paid off my mortgage, but I received a document in the mail, is this document important?”
Yes, this document is very important. If you paid off your mortgage or somebody else paid off your mortgage through a refinance or a sale, then the document that you receive needs to be recorded with that County’s Registry of Deeds.
When you grant a mortgage to a lender the mortgage gets recorded with the Registry of Deeds. Granting a mortgage places a lien on your property. This lien needs to be released once it is paid in full. These liens can be called mortgage discharges, releases of mortgage, or satisfaction of mortgage. While there are many different names for this document, it will always be notarized and often have a raised seal.
Say for example, you have a home equity line of credit. If you paid this off and your lender sends you one of these documents back they will alert you that the document needs to be recorded or if it is just a duplicate copy.
If you receive the original copy, you should bring it to the Registry of Deeds to have it recorded. You are always welcome to bring it to our office, so we can verify that it is accurate and help you record it.
If you would like more information about releases of mortgage, contact Stiles Law at (781) 319-1900.
Here’s a story about a conversation I had with a referral partner of ours. She was showing a property. After leaving, she received a phone call from the Seller who is her client. He asked her, “Why didn’t you tell them about the fireplace? Why were you so bearish on the pool? The pool is great!” The listing agent sat back and thought: how could the Seller possibly know about these conversations? “Were you taping us?”
In MA it is illegal to record the audio of people who do not know that you are recording them. So what should you do?
Sellers: We recommend against recording anyone at your open house, especially without disclosing the fact that you are recording to them. You may be committing a crime. Technically, video taping may be acceptable but it is probably bad faith. You are trying to gain a competitive advantage by recording prospective Buyers. Sellers should disclose that the property is subject to recording.
Professionals: if you are aware of recording, you need to disclose that fact. It should be disclosed on the MLS. It should also be disclosed to each person that is walking into the house. We recommend asking the Seller if they are recording. If so, you should tell them that you will have to disclose this to all prospective Buyers. Further, if a Seller is able to view a potential Buyer and use their appearance in deciding whether to sell to that particular buyer, there may be a potential fair housing violation.
Buyers: you should assume that any house you may be walking through has recording devices. Simply walk through without emotion, without conversation and discuss once you leave the house.
We received another question: “What is the right number, an appraised value or an assessed value?”
First, what’s the difference? An appraised value is a number that is determined by a licensed appraiser. Appraisers must take continuing education classes, they must go through licensing, and often use multiple factors to determine what a fair market value for the property may be. For instances, comparable properties that have recently sold, quality of finishes, or other improvements can impact the appraised value.
Assessed value is determined by the town through the assessor’s office. An appraised value is almost always closer to fair market value. Assessed value is less accurate and is used only to determine your tax obligations.
Appraisals cost money, so what should you do if you want to sell? We always recommend against relying on an assessment. Usually, spending money on an appraisal not necessary because a quality agent can generate an estimated value by doing a comparative market analysis. The agent will come up with a range of what the house may be worth.
Stiles Law, with offices located in Boston and Marshfield, Massachusetts, is a firm concentrating in real estate conveyancing and mortgage lending services, representing buyers, sellers, borrowers, banks, mortgage companies, investors, builders and developers in all of their real estate and mortgage transactions. Stiles Law serves all areas of eastern Massachusetts–the North Shore, Boston, and Cape Cod, in addition to the entire South Shore, including: Plymouth, Kingston, Duxbury, Hanover, Pembroke, Marshfield, Scituate, Norwell, Cohasset, Hull, Hingham, Weymouth, Braintree, and Quincy.