Dear Michael: We are buying a home with 100% cash (no loans). What is the advantage for us and for the seller if we don’t have a loan?
Answer: If you buy a home with cash you are in the minority and are in a much better position to bargain. There are many benefits of buying a home with all-cash. Here are a few of the advantages when buying a home all-cash. A) Bargaining Power: Most prospective buyers will have to finance their purchase through a mortgage. This means there is always a chance that the financing falls through. Most sellers want to eliminate this risk. B) Faster Closing: If you pay for a house with cash, you can usually close within 2 weeks as opposed to 45 days with a mortgage. C) No Appraisal: When you pay cash for a house, you and the seller agree on the price and it’s a done deal! If you have to obtain financing, the bank will require an appraisal and will cap the mortgage amount at the appraised price. D) No Interest: Interest can double the amount you pay for your house over 30 years. If you pay cash for your house, you pay the purchase price and no more. E) No Mortgage Payment: When you pay cash for a house, you free yourself from a mortgage note payment. This allows you to find other uses for your income each month. And retire with less debt.
Dear Michael: We are in escrow on our home. What steps will need to be performed in order to sign over the title of my house to the new buyer?
Answer: A property search will need to be performed by the title company. The title company will return the results of the title search in the form of a preliminary title report. This information will help ensure that there is clear title; the report will be needed to prepare the grant deed. The escrow company will prepare a grant deed specific to the parties and property involved in the transfer. Once the deed is prepared, the grantor (seller) will need to sign the grant deed which must be witnessed by a notary public. Once this step is complete, the deed must be filed at the county recorder’s office. The escrow and title companies will be in charge of making sure that all matters are attended too. A recording fee will apply.
Dear Michael: we are in escrow and waiting for our loan to be approved. How long does it take for a bank to approve a mortgage on a property purchase?
Answer: With lower rates, banks managing high volumes (including refinances) and the new TRID regulations the underwriting turn-around time is about 21 days from the time you start your loan application. Purchase transactions are being prioritized over refinances. Purchases typically take longer from application to the time the loan funds. Self employed borrowers, and FHA loans can take a longer period because of the increased documentation these loans require. The most effective way to have a quicker approval is to turn in a complete file for the underwriter approval when the loan application is submitted. If you require a quick close, choose your loan officer or mortgage broker wisely.
Michael Kayem is a Realtor with Re/max Estate Properties serving Culver City and the Westside since 2001. You can contact Michael with your questions at 310-390-3337 or e-mail them to him at: homes@agentmichael.com