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What is title insurance? And do I need it?

Once you understand it, protection is a no-brainer

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title insurance, gay news, Washington Blade

A home is the single largest financial investment most people make.

Sherri Anne: Deirdre, as part of my buyer discussions, I walk through the settlement process. What paperwork to expect, including the closing statement and the costs associated with purchasing a home.

But let’s be honest, the excitement and focus is always on finding the perfect home. Details on closing costs and fees are discussed, but not internalized. When the closing document arrives a few days before settlement, most buyers start taking a closer look.

A home is likely the largest purchase most people make in their lifetime so ensuring that they are spending wisely–on every part of the transaction—is top of mind.  When buyers start examining their bottom line, title insurance is something many ask if they can do without.

I’ve heard some horror stories regarding title issues and I know you’ve heard more. So, I thought it might be a great topic for us to discuss.

Deirdre: Of course. It’s important and, you are right, one that usually doesn’t get discussed until I am sitting at the closing.  At that moment, emotions are running high. The buyer is ready to start their new chapter of life in their new home. That moment just isn’t the right time to be deciding if you should or shouldn’t purchase title insurance.  Let’s shed some light on its merits and protection.

Sherri Anne: Great, so let’s start with the basics. What is title insurance?

Deirdre: There are two types: a Lender’s Title Insurance Policy and an Owner’s Title Insurance Policy. The Lender’s policy is required if you are taking out a mortgage loan. The Owner’s policy is optional which is why many ask if they can eliminate it.

In simple terms, title insurance insures against a successful title claim on the property. The Lender’s policy insures the financial investment of the bank or lender as defined by the loan amount and the Owner’s policy insures the buyer—the new owner of the property. The Owner’s policy is paid for with a one-time fee—not an annual payment like home owner’s insurance — and the policy will be in place for as long as the owner owns the property. The Lender’s policy is also a one-time fee, but is re-issued each time the buyer refinances the property.

Sherri Anne: Once I explain that the lender policy is required, their next question is, “If a Lender’s policy is being issued why would a I need an Owner’s Policy?”  Many see that Lender policy and assume it is enough coverage.  Why shouldn’t a buyer “depend” on the Lender’s policy?

Deirdre: The short answer is that the Lender’s policy covers the lender and not the Owner.  The Lender’s interest and the Owner’s interest may not always be the same when an issue comes up. Look at it this way, the Lender’s policy is based on the dollar amount of the loan. It only protects the lender’s interests in the property should a problem with the title arise. Its coverage amount is based on the loan balance on the day of the claim—not the value of the home. This is because the policy amount decreases as you pay down your loan and eventually disappears as the loan is paid off. An Owner’s policy is usually issued in the amount of the real estate purchase, not the loan value. Only an Owner’s policy protects the buyer should a covered title problem arise. Possible hidden title problems can include: errors or omissions in deeds; mistakes in examining records; forgery; undisclosed heirs.

An owner’s policy provides assurance that your title insurance company will stand behind you—monetarily and with legal defense if needed—if a covered title problem arises after you buy your home.

Sherri Anne: All of this sounds great, but sometimes real-world applications help us all understand an issue. Can you share a case where you’ve seen title insurance was needed to correct a problem?

Deirdre: Claims against title happen every day. Even though the title company will conduct a search and resolve any title issues that are seen at the time, problems could arise that threaten the buyer’s ownership rights. For example, forgery. There have been cases where a seller has misrepresented their identity and sold the property only for the real owner to turn up after settlement. The transaction is therefore not valid, because the fake seller had no right to sell.

The most frequent title claims just involve human error. Mis-recorded documents, incorrect legal descriptions, and very old documents that are not available electronically can all lead to title claims in the future.

These things happen enough that your lender wants coverage.  Just like any other insurance product, you may never need it, but you will be really happy that you have it if you ever do.

Sherri Anne: Without title insurance it would be up to the owner to depend on their own defense, correct? And, we both know that could get costly.

Deirdre: Just as you said, a home is the single largest financial investment most people make. We do not think twice about insuring everything else that is valuable.  We get life, car, and personal insurance, and insurance for our health and pets. Wouldn’t a buyer want to insure their largest financial investment as well? For a one-time fee, Owner’s title insurance protects the buyer’s property rights for as long as they own the home.  Once you understand what it is – it really is a no brainer.

 

Sherri Anne Green is an award-winning Realtor with Coldwell Banker Residential Brokerage focused on custom, data-driven marketing and client service. Reach her at 202-798-1288, or [email protected], or on Facebook, or on Instagram. Deirdre P. Brown, J.D.  is a settlement agent with Mid-Atlantic Settlement Services, LLC. Reach her via CloseWithDee.com

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Real Estate

Don’t procrastinate buying your home

Some experts predict rates will fall in June

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Spring is in the air and it’s a great time to buy a new home.

As springtime fills the air, cherry blossoms are blooming, much of the year still lies ahead and many have started to think about how they are progressing with their 2024 goals. If the dream of buying a house was put on hold when the interest rates went from 3% to almost 8%, and life got in the way of an idea that had gotten onto your to-do list, maybe now is the time to dust it off. 

Mortgage lender Tina Del Casale from Sandy Spring Bank says, “There is still hope the Fed will be happy with inflation numbers by June to finally pull the trigger on lowering interest rates.”  

The rates might not be as low as they were in 2021, but historically, they are still not as high as they were 20 years ago. Some people’s parents remember getting interest rates that were 12%, 14% or even higher.   

One of the biggest questions I get at homebuyer seminars is about is the process. What is buying a house ACTUALLY like?  I usually tell them that it’s like anything else. One step at a time. One form at a time. One bank transfer at a time. One house showing at a time. One home inspection at a time. If you have the wherewithal to plan a vacation, you can buy a house. 

  • Finding a Realtor
  • Finding a lender to get pre-approved (how much is your budget and what is a comfortable monthly payment)
  • Are there any first-time buyer programs that could be used? Is there down payment assistance?
  • Looking at the houses.
  • Finding one you like, and putting an offer together:
    • An offer usually involves a sales contract, any special forms that the jurisdictions require (lead-based paint acknowledgements, what appliances and systems in the house are included/excluded, if the home is part of a homeowners association, or a condo association, etc.)
    • Any forms related to getting an inspection done.
    • Who is selling the house, who is buying the house, how much is it being sold for, where it is exactly, and who are the others involved in the transaction (title company, agents, etc.)?
  • Getting any inspections done.
  • Negotiating any changes in the sales price or terms, or credits for inspection items.
  • Getting the final approval for the loan and then going to settlement.

Many people get interested in buying a house, but the “unknown” of it all can be daunting. It could be that the best way to think about it, is that like most things in life, you can’t cross every bridge BEFORE you get there. You just take it one day at a time. Some things will be surprisingly easy. Some things will require the advice of experienced lenders, Realtors, home inspectors and title attorneys.  

But if the process doesn’t begin somewhere, somehow, the idea just stays in one’s head in the “to do list” file.  And then 3 years go by, 5 years go by, 7 years go by. And your friends that DID buy a house laugh themselves to the bank when they go to sell the house they bought 3 years ago, 5 years ago, or 7 years ago.

If you need any recommendations for a local lender or Realtor, please don’t hesitate to ask.

Joseph Hudson is a referral agent with Metro Referrals. Reach him at [email protected] or 703-587-0597.

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Real Estate

Down payment strategies: Financing your home purchase 

Understanding the options key to unlocking the door to a dream home

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Looking for your dream home? First, you need to understand how to make the down payment.

Navigating the path to homeownership can be a complex journey, especially when it comes to accumulating the necessary down payment. For members of our LGBTQ community, understanding the available options for saving and financing this crucial aspect of home buying is key to unlocking the door to their dream home. Let’s explore effective methods and resources specifically designed to support LGBTQ individuals on their path to homeownership.

Traditional Savings Strategies

Saving for a down payment often begins with traditional methods such as setting aside a portion of your income into a dedicated savings account. High-yield savings accounts and automated savings plans, some offering up to 5% interest in today’s market, can expedite the process, providing a disciplined approach to accumulate funds over time. Additionally, exploring investment opportunities that match your risk tolerance can offer potential growth for your down payment savings.

Down Payment Assistance Programs

A variety of down payment assistance programs exist to help homebuyers with their initial costs. These programs often offer grants or low-interest loans to first-time homebuyers or those who haven’t owned a home in the past three years. 

It’s essential to speak with a GayRealEstate.com agent to determine what programs may be available, plus online research into local and state assistance programs, as many are designed to support individuals in specific communities, including the LGBTQ+ community.

For medical professionals, police, teachers, firefighters, and other community heroes, there are several special loan and assistance programs designed to help with home purchases, often offering benefits like down payment assistance, reduced closing costs, and more favorable loan terms.

The Hero Home Loan Program provides first responders, including police officers, firefighters, and paramedics, with benefits such as lower interest rates and reduced closing costs. This program aims to make homeownership more accessible by offering more flexible credit score requirements and down payment assistance .

For educators, firefighters, law enforcement officers, and medical professionals, the Everyday Hero Housing Assistance Fund (EHHAF) offers closing cost assistance through gift funds. This program is designed to support those who serve their communities by making homeownership more affordable, with no repayment required for the grant funds​​.

The HUD Good Neighbor Next Door Program offers up to 50% off the list price of homes for law enforcement officers, pre-Kindergarten through 12th-grade teachers, firefighters, and emergency medical technicians. This initiative aims to encourage community revitalization by assisting these professionals in homeownership within the communities they serve​​.

Homes for Heroes provides assistance specifically to first responders and offers significant savings through Hero Rewards when buying, selling, or refinancing a home. On average, participants save $3,000, with the program offering real estate and mortgage specialist connections tailored to the needs of first responders​​.

LGBTQ-Friendly Lending Options

Finding a lender that understands and supports the unique needs of our LGBTQ community can make a significant difference. Some lenders and organizations specialize in offering inclusive financial products and resources to assist LGBTQ+ homebuyers. These may include specialized mortgage products, financial planning services, and guidance through the home buying process.

The journey to homeownership is a milestone that requires careful planning and support. Remember, every step taken towards saving and financing your home purchase brings you closer to the dream of homeownership.

(GayRealEstate.com offers valuable resources and advice tailored to meet the unique needs of our LGBTQ+ community in their journey towards homeownership. For more comprehensive guidance and support in navigating the home buying process, visit GayRealEstate.com choose an agent and start a no-obligation conversation today.)

Jeff Hammerberg is founding CEO of Hammerberg & Associates, Inc. Reach him at [email protected].

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Real Estate

Turn your bare walls into captivating focal points

Paint, wallpaper, statement installations and more

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Whether you prefer artwork, paint, wallpaper, or statement walls, there are countless ways to adorn and decorate your walls.

Are you tired of gray walls and white kitchen cabinets with white granite or marble countertops? Have you gone back to the “Builder Beige” that was popular in the ‘90s?

Your walls are the blank canvases of your home, waiting to be transformed into stunning expressions of your personality and style. Whether you prefer vibrant artwork, paint, eye-catching wallpaper, or statement walls, there are countless ways to adorn and decorate your walls to elevate your space. Here’s a guide to help you turn those bare walls into captivating focal points. 

Wallpaper: Wallpaper has again become a versatile option for adding texture, pattern, and color to your walls. Whether you prefer subtle designs or bold prints, there’s a wallpaper to suit every taste. 

It now even comes in peel and stick rolls, so you don’t have a mess of water and paste. For some new designs, check out www.spoonflower.com

Before selecting wallpaper, consider the scale of your room and the atmosphere you want to create. For small spaces, opt for light, airy patterns to make the room feel more spacious. Conversely, in larger rooms, you can go bold with intricate designs or vibrant colors to make a statement. Don’t be afraid to mix and match wallpaper with paint, or even wallpaper the ceilings for a unique and dynamic look.

Statement Walls: Statement walls are a bold way to add personality and drama to any room. From accent paint colors to textured finishes, the possibilities are endless. Consider using a contrasting color or texture to highlight a specific wall and create visual interest. For a contemporary touch, try incorporating geometric patterns or asymmetrical designs with strips of wood. Hand-painted murals are another option for creating striking statement walls. Choose a mural that reflects your interests or transports you to another world for a truly immersive experience.

Paneling/Brick: The shiplap phase may be dying out, but there are still many ways to use wood and paneling in your wall décor. Reclaimed wood is a popular option, as are wood slats such as the ones found at www.woodpanelwalls.com. Use them on walls or ceilings, or as a background for wall-mounted televisions and sconces. Amazon also has lots of options for wood veneer available and exposed brick is popular in many contemporary homes. If you don’t have a brick wall to uncover, select from options such as lightweight faux brick or stone.

Artwork: Art has the power to breathe life into any room. When choosing artwork, consider pieces that resonate with you personally and complement your existing décor. Experiment with a mix of styles, sizes, and mediums to create visual interest. Hang artwork at eye level to ensure it is easily visible and balanced within the space. Enhance gallery walls by arranging multiple pieces in a cohesive layout. Remember that art is subjective, so whether you choose an inexpensive poster or a gallery quality painting, select pieces that speak to you.

Photo Displays: Showcase your favorite memories and moments with a curated photo display. Whether it’s a collection of family photos, travel snapshots, or artistic prints, arranging photos on your walls adds a personal touch to your space. Try out different frames, sizes, and layouts to create a gallery-style display that reflects your unique style. It makes a nice presentation on that odd wall going up your stairs. 

Mirrors: Mirrors are not only functional but also serve as decorative accents that can enhance the visual appeal of any room. Strategically placing mirrors on your walls can create the illusion of space, brighten dark corners, and reflect natural light. Choose mirrors with interesting frames or shapes to add an extra layer of style to your décor. Try different sizes and arrangements to find the perfect balance between form and function.

Textile Hangings: Textile hangings are a bohemian-inspired alternative to traditional wall art. From tapestries to woven rugs, textile hangings add warmth, texture, and color to your walls. Hang a large tapestry behind your bed as a dramatic headboard alternative or layer smaller textiles with framed artwork for a cozy, eclectic look. Consider mixing and matching different textures and patterns to create visual depth and dimension.

Adorning and decorating your walls is a creative and personal process that allows you to infuse your space with personality and style. The key is to trust your instincts and have fun with the process. Use different techniques, colors, and textures until you find the perfect combination that speaks to you and transforms your walls into works of art. With a little imagination and creativity, you can turn any blank wall into a stunning focal point that reflects your unique taste and aesthetic.

Valerie M. Blake is a licensed Associate Broker in D.C., Maryland, and Virginia with RLAH Real Estate/@properties. Call or text her at 202-246-8602, email her via DCHomeQuest.com, or follow her on Facebook at TheRealst8ofAffairs.

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