Resources

Resources

 

Find Our Most Frequent Questions Below

Vaughn Law Firm is committed to our clients. We are here to answer any and all of your real estate questions. We can provide information to buyers and sellers. We also provide information about refinancing.


Buyer Resources

What is a real estate “closing”?

A real estate closing, or the “closing” as it often called, is a meeting between the buyer and the seller, the buyer and seller’s real estate and agents, and occasionally the loan officer, conducted by the closing attorney for the purpose of signing all documents necessary to transfer title of real property from the seller to the buyer as well as the lender’s loan documents. Once you have signed a sales contract for your new home, and arranged for financing, and completed all necessary inspections and repairs, you are ready to complete the purchase. The buyer and seller will meet at a real estate lawyer’s office to sign all of the documents necessary to transfer title from the seller to the buyer, which include:

  • a closing disclosure/settlement statement authorizing the disbursement of all funds;
  • loan documents from the bank or mortgage lender financing the property
  • a deed of conveyance from the buyer to the seller
  • miscellaneous other documents to complete the terms of the sales contract

At the closing, borrower and lender will provide their funds to the closing attorney, the seller will transfer the title to the property to the buyer by a written deed. The “closing attorney” who handles the closing will then payoff any loans or liens the seller has secured by the property, and disburse all of the monies owed to the seller, the real estate agents and other vendors owed money on the sale.

what does the closing attorney do?

In a typical real estate transaction or loan closing, the closing attorney performs the following services:

  • Researches the title to the property to verify the record owner of the property, to verify that the owner has marketable title and to identify the lienholders who will need to be paid off at closing to transfer marketable title to a buyer and to properly secure any new loan to be secured by the property.
  • Obtains payoff information for existing loans and other liens.
  • Obtains taxes and homeowner association dues (if any) which will need to be paid and or prorated at the time of closing.
  • Provides the lender with a title commitment and other information that the lender needs to complete the loan and generate a loan package.
  • Prepares a settlement statement for the lender and the Realtors to approve.
  • Schedules a closing date and time to complete the transaction according to the terms of the sales contract and the lender’s closing instructions.
  • Conducts a closing where the buyer (or borrower) and the seller will sign all documents necessary to complete the transaction.
  • Disburses all funds in accordance with the settlement statement.
  • Records deeds, deeds to secure debt, and other documents with the Clerk of the Superior Court for the County in which the property is located.
  • Verifies loans and other liens which were paid off at closing are properly released.
  • Returns final recorded documents to the buyer and lender.

Why do I have to have a lawyer handle the closing?

Generally you must use a lawyer to handle the sale of real estate or a loan secured by real estate.

Can I select which lawyer I want to handle my closing?

If you are the buyer, you are entitled to choose your closing attorney. While the seller may offer to pay part of the closing costs if you agree to use their closing attorney, the seller cannot require you to use their preferred closing attorney. It’s your choice.

What do I need to bring to closing?

  • A government-issued photo ID. We are required to verify your identity at the time of closing. A valid driver’s license or passport are acceptable forms of identification, as long as it includes a photograph.
  • Certified Funds and Checkbook. Whether you are the buyer or the seller, items sometime arise at the last minute, and you may need to write a check. For example, there may be a recording fee that we had not anticipated, an agreed fee that was not provided to our office, or a last minute repair that is added to the final settlement statement.
  • Any items required by the Lender. Your lender may instruct you to bring certain documents to closing to be returned to the lender with your signed loan package.

How much money will I need to bring to closing?

Your lender will give you a Good Faith Estimate (GFE) of the funds you should expect to bring to your closing. However the GFE is just that, an estimate. Once we prepare the final HUD-1 Settlement Statement, and obtain the lender’s approval, we will advise you of the amount you will need for your closing, and how those funds must be paid. We do not accept cash. All funds must be paid by wire transfer, certified check, or personal check. For amounts greater than $500.00, you will be required to bring certified funds or pay by electronic wire transfer. We will provide you with wiring instructions at the time we provide you the final amount due at closing. For amounts less than $500.00, you will be advised whether those funds must be certified funds or whether we will accept a personal check.

How long will the closing last?

Generally, a real estate closing will last about 1 hour.

What is a HUD-1 or a settlement statement?

All real estate transactions involving a buyer and seller will have a settlement statement showing the funds paid by the buyer and the funds due to the seller, along with any disbursements to be made to the seller’s mortgage lender, the real estate agent, and other vendors. In almost all instances, the settlement statement will be on a HUD-1 form. The HUD-1 (or HUD as it is often called) is a 3 page document developed by the U.S. Department of Housing and Urban Development to use is federally regulated home mortgages.

what is a closing disclosure?

For most residential loans originating after October 3, 2015, the HUD-1 Settlement Statement will be replaced by the new “Closing Disclosure.”  This new form is five (5) pages, and includes information formerly provided to the buyer/borrower and seller on the HUD1 and Truth-in-lending (TIL).  This new form does not completely replace the settlement statement, as the buyer/borrower and seller will still sign a settlement statement (similar in form to the old HUD-1) showing and authorizing disbursements made by the closing attorney.

what name will be on the deed?

For the buyer, the name on the deed will be the same as shown on the contract and the loan documents. Generally, we will conform the buyer’s name to match the name you used in your loan application and which appear on the loan documents. However, some institutional sellers will only convey title to the property as shown on the sales contract.

what if I want to add my spouse to the deed?

We can generally add a non-borrowing spouse to title at the time of closing. If you want do want to add a non-borrowing spouse to title, please advise your closer, prior to the closing date.

What is the difference between general warranty deed and limited warranty deed?

The seller will convey title to the buyer by a deed. There are various types of deeds, but the most common type of deed used in a residential real estate transaction is the warranty deed. The type of deed the seller will provide is a matter of contract.  A general warranty deed contains warranties of title from the seller to the buyer, that the seller is seized and possessed of a good and marketable title, and will defend the title against all claims.

 A limited warranty deed limits the warranties of a good and marketable title to those persons claiming by and through the seller. For most people, this will make no difference. The buyer gets the same rights to a property under a limited warranty deed as they would under a general warranty deed. However, limited warranty deeds do limit the seller’s exposure to liability for claims against the title. For that reason, now more than ever, buyers will need an owner’s title insurance policy.

What is “owner’s title insurance”?

Title insurance insures that you have good and marketable title, subject only to the loan you took against the property and any easements and covenants of record. A title insurance policy does not guarantee that your title is perfect. However, it is a contract of insurance through which you can protect yourself from serious financial loss if a problem should arise which challenges your title.

What is a deed of trust?

The Deed of Trust is the document that transfers the title to the bank as collateral for their loan. While most people refer to it as the mortgage, from a legal perspective, it is different from a mortgage. In Mississippi, lenders often use a Deed of Trust to secure debt rather than a true mortgage to secure their loan.

What happens to the documents I signed after closing?

The loan documents are returned to the lender. The deed and deed of trust are recorded with the chancery clerk for the county in which the property is located.

Do I need to purchase a certified copy of my deed?

No. Once the warranty deed is recorded with the Chancery Clerk, we will return the original, recorded copy to the buyer(s). There are very few reasons why you would need a certified copy of the deed, and certified copies are readily available from the Chancery Clerk for a small fee if you ever do need a certified copy.

Do I have to file for homestead extension every year?

No. Once you file for homestead exemption, you will be deemed to have re-filed for homestead exemption every year thereafter, until there is a change in ownership or death.

What is homestead exemption?

If the property you are buying will be your primary residence, you may qualify for homestead exemption. Homestead exemption can refer to exemptions from property tax that homeowners can claim.

How do I file for Homestead Exemption?

In Mississippi, you must appear, in person, at the county tax assessor’s office and fill out an application for the exemption. When we return the original recorded warranty deed to you, our cover letter will provide information on where and how to file for homestead exemption.

How long do I have to file for Homestead exemption?

Applications for homestead exemption must be filed between January 1 and April 1. When we return the warranty deed to you, our cover letter will give you instructions on where and how to file for homestead exemption.
       
 
Contact Vaughn Law Firm today at 601-544-8550 or email at jessica@vaughnlawpllc.com.