Thursday, April 24, 2014

Title Topics: What is a HUD?

HUD is an acronym for the U.S. Department of Housing and Urban Development. However, when mortgage professionals refer to the HUD, they are referencing the HUD-1 settlement statement.  It’s a document that you should get to know and understand before you go to your closing

So, what exactly is a HUD-1 settlement statement?

Regulated by the department of Housing and Urban Development, the HUD-1 form itemizes the closing costs associated with a home purchase or loan refinance.  To see an official blank form, click here.

What is the “Good Faith Estimate”?

As you scroll through the form, you may notice a column labeled Good Faith Estimate (GFE) on the last page.  This is where the HUD-1 compares the final loan fees to the original GFE.  The GFE is provided at during loan negotiation with the lender, but fees might fluctuate if loan amounts change during the mortgage process.

What should I look for?

Although it’s important to thoroughly read any HUD-1 statement, here are a few quick hits of information:

Funds due at closing

Take a look at lines 303 and 603 of the form to see the funds or cash disclosure due at the closing for the seller (if it’s a purchase transaction) and borrower.  You will find that either you owe money OR that you will be receiving loan proceeds disbursed by the lender after the closing.

Title fees

Title fees for an owner's policy and a lender's policy will be located in the 1100 lines.  Title fees are state regulated and will vary according to the subject property’s location.

Appraisal fees

Appraisal fees are located in the 800 lines categorized as Items Payable in Connection with Loan.


The Real Estate Settlement Procedures Act (RESPA) is a federal law that gives consumers the right to review information about loan settlement costs after you apply for a loan and again at loan settlement. RESPA guidelines oblige lenders to provide these disclosures at various times in the transaction. As part of RESPA regulations, this procedure helps to regulate the cost of settlement services for consumers and ensure accurate loan fee estimates.  If there is a lender credit due to RESPA cure, it will be located in the 200 section of the HUD-1.
Look at the fees in a section on the last page of the HUD called Charges that Cannot Increase . The lender will cover extra fees via the RESPA Cure if:
·         Fees listed are greater than what was disclosed on the GFE
·         Fees in the section called Charges that Cannot Change Above 10% are indeed 10% greater on the HUD than what was disclosed on the GFE

Any questions or comments?  Please let us know!

Wednesday, April 16, 2014

Introducing Tom Horton!

Title Source National Commercial is proud to welcome Tom Horton to the team.

This Texas native brings nearly four decades of experience with him as he started his career in the title business at the age of 15. He will be our Texas National Commercial State Manager, responsible for our commercial division as well as assisting with residential compliance and audit.

Tom comes to us from Old Republic National Title Insurance Company where he served as the Vice President of commercial underwriting. Having started working in the title industry as a file clerk and advancing through the ranks of abstracting and title examination, he has had the opportunity to work for and with many icons within the title community.

Although he will be stationed in Texas, we look forward to Tom visiting our headquarters in Michiagan when he makes his annual trip to go duck hunting with
Steve Nadolski, VP of Title Source National Commercial,  and 
Lance Davis, Senior Commercial Account Executive.

Congratulations and welcome Tom!

Tuesday, April 8, 2014

Four Tips for Selling your Home this Spring

While this winter may have felt like an eternity, spring is finally here! As the weather begins to warm up, more potential homebuyers will be out and about, so if you're planning on selling your home, it's time to take a few steps to start getting your home ready. Here are a few tips so your house is prepared for the market this spring:

1.  Get the property appraised
Property appraisal is one of the most important steps when selling your home. No matter what you paid for the property, market values, time and any improvements you have made will all have an effect on how much the property is currently worth. Bring in a professional to go over your home and give you a realistic estimate of its value.

2.  Clear the clutter
Once you get serious about selling your home, it's time to start going through the stuff you've been keeping around for years. Pull out boxes from the basement or attic storage space, dive into rarely used closets and empty junk drawers. Clearing your home of the belongings you neither use nor need will help make the storage spaces look bigger and neater, which potential homeowners will like to see. It also offers the added bonus of cutting down on what you have to move to your new home after your house sells.

3.  Consider curb appeal
Spring is the perfect time to reevaluate what the front of your home looks like. After all, it's the first thing potential buyers will see when they pull up. Consider planting flowers or bushes - stick to non-exotic, native species that are easy to care for - and freshen up exterior paint if needed.

4.  Hire a professional for photos
It's more common than ever for those shopping for homes to start their search online. Because of this, it's important to give your home a great presence on the web. One of the best ways to do this is through high-quality photos of the entire house. Though you may have a smartphone with a camera or a point-and-shoot you can use, it's usually worth it to bring in a professional. A seasoned photographer will know how to take pictures that maximize the space and natural light in any room, making the photos highlight the great features of your home.

Tuesday, April 1, 2014

Buying is Cheaper than Renting

Here’s an unusual concept: buying a home is cheaper than renting one. And if you’re in the right location, purchasing a home is far less expensive than renting. How is something like this possible? Over the past year, low mortgage rates have made home ownership a more attainable reality, at least more so than renting. In some areas, like San Francisco and Seattle, rents have skyrocketed making buying look like a cheaper option in comparison.

What’s the better financial bet? According to Trulia’s Chief Economist Jed Kolko, who runs numbers every six months to answer just that question, homeownership is 38% less expensive than renting. But the rent vs. buy math varies in every local market. In Honolulu, ranking last on the list of metro areas where buying is a good bet, there is still a 5% cost-savings according to In Detroit, purchasing a home is listed as 66% cheaper than renting. This cost-savings trend is the case in all of the 100 largest metro areas.

How accurate is the Forbes model? Well, it does assume conservative home price appreciation, but as too many of us have experienced home prices can greatly increase or plummet rather unexpectedly.

Here’s something else to take into consideration. The gap between renting and buying is narrowing due to rising mortgage rates. A 30-year fixed mortgage can be captured with a rate of only 4.5%, making home purchases 38% cheaper than renting, but one year ago home prices were 44% cheaper.

Will renting become less expensive than buying again soon? Most economists say yes, beginning this year in some markets, because they expect mortgage rates to rise due to the straining economy and tapering from the Federal Reserve. Nationally, rates would have to rise to 10.6% for renting to be cheaper than buying, and rates haven’t been that high since 1989.

Owning a home, the American dream, is now on clearance for a limited time only*

*Select locations only

To read more, click here.

Tuesday, March 25, 2014

5 Real Estate Myths Debunked

There’s no shortage of advice out there for home buyers. From blogs like ours, to parents and friends in the know, you’ll hear a lot about what you should, or shouldn’t, do.

Today, we’re setting out to bust the myths of some of the most popular pieces of real estate advice. We’ll break down the most often-heard nuggets of “wisdom” and find why or why not it might work for you.

Myth #1: Go it alone! Who needs a realtor?

Some fearless folks are willing to head out into the wilderness, learning as they go. It’s admirable, but when dealing with what is probably the single biggest purchase or sale of your life, a little backup never hurts.
Realtors provide valuable insight into the market at the ground level. They know the ins and outs of the area, are in tune with price indicators and they deal with home pricing every day.
When in doubt, pick up the phone and call a realtor. He or she can make the case for their services, but they can also offer guidance, often for free. And as with any service professional, ask friends and family for referrals.

Myth #2: The more you put down, the better off you’ll be
A down payment on a house serves two major purposes:
  1. It’s a cash payment that gives the bank capital to create the money for your mortgage.
  2. It ensures that if there is ever a default on your mortgage, the bank makes a percentage of its money back.
It also shows the bank that you’re able to manage your money well enough to save up a large sum of cash, which makes you a better-looking borrower.
You’ll hear that the ideal amount to put down on a house is 20% of the total cost, which for some, is simply out of the question. But just because you don’t have the cash doesn’t necessarily mean you can’t afford a mortgage. You don’t even have to put 20% down.
Federal Housing Administration Loans (FHA Loans) give you the option to put as little as 3.5% down. When your down payment dips below 20% though, you run into Private Mortgage Insurance, or PMI, which is an additional monthly payment.
But it’s not all bad news if 20% down is out of reach. The New York Times reported in September of 2009 that in the wake of the mortgage meltdown, lenders who used PMI received lower interest rates. In the lenders’ eyes, a down payment with PMI is insured, and therefore less risky.
In addition to a potentially lower interest rate, you have added flexibility with your money. With a traditional down payment, 20% of your home’s value is tied up in cash. That cash can be used to make repairs, make additional investments, or make additional payments on your PMI, which goes away once you paid the equivalent of 20% equity in your home.

Myth #3 Buying is best
Home ownership has its benefits. Things like tax deductions, pride of ownership and having additional equity are all great reasons. But it also comes with its hangups. Maintenance, a potential loss in equity…what if you have to move suddenly for a job?
But if you rent, those troubles go out the window.
For some, the ability to call a property manager when your roof springs a leak is well worth giving up that pride of ownership. Sure it feels great to mow your lawn for the first time this season. But come August, renters feel great to be able to sit back and sip lemonade without breaking a sweat.
What’s more, rent is relatively fixed. Increases can occur, but if it gets too costly to live in that Manhattan penthouse, you always have the option to pick up and find something more affordable. No questions asked.
Renting is ideal for some, just like home ownership is perfect for others.

Myth #4: Remodeling equals higher resale
Remodeling is a great way to breathe new life into the look of your house.
But that’s it.
It’s not an investment.
Whether you’re putting in a new shower, hardwood floors or new countertops, the money you spend could be recouped in the value of your home. But it’s not a guarantee.
Another thing to keep in mind: your favorite look might not be liked by everyone else. An extra lush pile and wood paneling just might make the den your favorite room in the house, potential buyers might not agree.
The best remodels are ones that add function and are pleasing to you or your family. Not the ones that make the most money when it comes time to sell.

Myth #5: It’s a bad time to buy/sell
No matter where you are in the country, no matter what’s happening in the housing market, nobody knows better than you when it’s a good time to buy or sell.
If a job relocation takes you to a different city, then the time to sell is now. If you and your kids are piled on top of each other, four to a bed a-la Charley Bucket’s grandparents, the time to buy is now.
Your situation will also dictate your timing. Do you have enough to put down on a home? Is there a strong enough reason to sell the home you’re in? Is your credit score beefy enough to get a decent interest rate? It all factors in.
Regardless of the market, there are homes out there that meet (or exceed) your needs. And if you’re looking to sell, the right price can get an offer.
Weighing the cost of selling your house (and not making 100% back on that dream den) is your decision. And nobody knows your situation better than you.

Mythic Proportions

Buying and selling a house is a high pressure, high intensity process. You might not ever buy anything more expensive than your home, so go ahead and get worked up a little. It’s only natural.
There are enough twists to turn the stomach of even the most experienced of us.
Coupled with the advice that you get from your know-it-all uncle and your most trusted friend, your experience will be yours and yours alone. So use your best judgment, keep your wits about you, and armed with the top 5 debunked housing market myths. You’ll be just fine.
Have any myths of your own? Share them with the class and post them in the comments below.

To read more, click here.


Tuesday, March 11, 2014

Positive Home Values on the Horizon

If you tried to purchase a home in 2013, you’re probably familiar with the bidding wars that ensued in many markets. But trends are starting to show that that won’t be the case for 2014s prominent home buying season (the spring and summer months). That’s because buyers will have a bigger supply of inventory to choose from and therefore, more leverage when it comes to price. Yes, compared to historical standards on a national level inventory remains relatively low, but it’s up by 11.1 percent since January 2013, which is something worth noting.

So how was this determination made? Markets that were previously short in supply, like Las Vegas, Phoenix and Sacramento, saw rapid rates of price appreciation and the largest amount of additions to their for sale inventory. Las Vegas saw the greatest year-over-year growth in available supply (a jump of 42.8 percent from January 2013). Phoenix’s inventory increased by 30.5 percent and Sacramento’s grew by 26 percent.

According to the latest Home Value Index from Zillow, U.S. property prices climbed 0.2 percent from December to January, the slowest rate of appreciation seen in 18 months, largely due to inventory increases in 22 of the 35 major metro markets highlighted in the report.

“Last year tight inventory contributed to very rapid home value appreciation,” said Stan Humphries, Zillow’s chief economist. “Now, more inventory is helping to moderate home value increases in many areas. This increased supply is coming from many sources, as more sellers are free to list their homes after being released from negative equity, builders continue to ramp up construction and many homeowners decide to list their homes and capitalize on recent gains.”

Wednesday, March 5, 2014

Office Olympians

 The Olympics may have been based in Sochi this year, but Title Source still got a piece of the action back in the U.S. To prepare for the office Olympics, Title Source team members stretched their thumb muscles and prepared to participate in the paper airplane toss, Frisbee shootout and paper ball basketball contests.

Paper Airplane Toss!

Participating team members had one minute to fold an 8.5” by 11” paper airplane. After the minute they threw the planes; the three to go the furthest took home that free-flying glory.

Frisbee Shootout!

Team members came into work to find a mini Frisbee on each of their desks – a little way to encourage participation in the Title Source Frisbee shootout.

 Participants had to knock three cups off a table using their mini Frisbee. The three team members who accomplished this in the lease amount of time were declared our quick-to-the-draw winners.

Paper Ball Basketball!

A returning favorite from the last Title Source Olympic events, paper ball basketball required team members to shoot as many paper balls into a basket as possible. The ones to shoot the most were declared our free-throwin’ winners.

What will the intense competition of the Title Source office Olympics bring in 2016?