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Buyer/Borrower Information

REPRESENTING THE INTERESTS OF THE BUYER IN REAL ESTATE TRANSACTIONS

OUR FIRM’S PRIVACY POLICY NOTICE

WAYS TO HOLD TITLE IN MASSACHUSETTS

CLOSING ATTORNEYS AND THE CLOSING PROCESS - WHAT YOU SHOULD KNOW

TITLE INSURANCE AND ITS IMPORTANCE IN YOUR TRANSACTION


REPRESENTING THE INTERESTS OF THE BUYER IN REAL ESTATE TRANSACTIONS

If this is your first home purchase, or perhaps you haven't purchased a new home in a while, the process may seem confusing. We hope that our office can make the entire purchase process easy and enjoyable for you. There are a few things to remember.

First, understand that the lender's closing attorney, and this includes our office if we are representing your new lender, represents the interests of the lender. Therefore, it is not the responsibility of lender's counsel to advise you on your rights and obligations regarding your new home purchase. Because of this we highly recommend that you retain your own attorney to represent your interests in this process. Our office can represent you, even if we are handling the closing for your new lender, for a reasonable fee and give you the comfort you need to proceed confidently toward the purchase of your new home. Some of the services we provide when representing buyers are:

  • Negotiation and preparation of the offer to purchase and purchase and sale agreement to protect your interests and concerns.
  • Resolve issues which may arise during the pendency of your purchase and assist you if you are selling real estate to purchase your new home.
  • Explain the mortgage process and assist you in understanding just what the lender’s commitment letter says.
  • Assist in the coordination of the closing and represent you at the closing, review all closing documents and explain their meaning and significance to you.
  • Answer questions you might have and resolve disputes that may arise at any time during the closing process.

Please call our office to discuss how we can represent you and what are fees are for this service. We look forward to hearing from you.

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OUR FIRM’S PRIVACY POLICY NOTICE

This notice is provided to you pursuant to the Privacy of Consumer Financial Information Act and the Federal Trade Commission's implementing regulation thereunder, 16 CFR Part 313.

  1. We collect nonpublic personal information about you from the following sources:
    Information we receive from you on applications or other forms either directly from you or from lenders and their affiliates or agents;
  2. We do not disclose any nonpublic personal information about our clients, borrowers, or sellers to anyone, except as is necessary in the mortgage loan transaction as may be necessary to effectuate the transaction with the lender that you have requested; to prevent fraud or unauthorized transactions; as otherwise required or permitted by law.
  3. We restrict access to nonpublic personal information about you to those clients, lenders, third parties and employees who need to know that information to provide the requested settlement services to you. We maintain physical, electronic, and procedural safeguards that comply with federal regulations to guard your nonpublic personal information.

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WAYS TO HOLD TITLE IN MASSACHUSETTS

The three most common ways two or more persons may hold title to real estate are:
TENANTS IN COMMON, JOINT TENANTS or as TENANTS BY THE ENTIRETY (tenants by the entirety is only available for married couples)

What Happens Upon Death
1. When title is held as Tenants in Common, it is necessary to probate the estate of the deceased before the real estate may be sold or mortgaged. There is no right of survivorship and so the deceased persons interest in the property passes to his or her heirs and not to the other owner(s).
2. When the title is held a Joint Tenants or as Tenants by the Entirety, the title automatically passes to the surviving owner(s) without the necessity to probate the estate of the deceased.
3. In any case of death of an owner of real estate, whether Tenants in Common, Joint Tenants or Tenants by the Entirety, it may be necessary to procure a release of the estate tax or taxes which may, by statute, become a lien on the property.

Who has Control and Management?
1. When title is held as Tenants in Common or Joint Tenants, the rents, control, management and possession of the property is in the owners equally, in the absence of an agreement to the contrary, but the individuals can divest themselves of their individual share in the property without the joining in with the others.
2. Under the provisions of M.G.L. c.209, section 1, when title is held as Tenants by the Entirety, (which is limited to husband and wife) rents, control, management and possession of property are in the owners equally. Chapter 209 further provides:
"...The interest of a debtor spouse in property held as tenants by the entirety shall not be subject to seizure or execution by a creditor of such debtor spouse so long as such property is the principal residence of the non-debtor spouse; provided, however, both spouses shall be liable jointly or severally for debts incurred on account of necessaries furnished to either spouse or to a member of their family."
Neither the husband nor the wife can divest themselves of their interest in the property to any one except to each other, so long as the marriage lasts, without the signature of both."


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CLOSING ATTORNEYS AND THE CLOSING PROCESS - WHAT YOU SHOULD KNOW

Your application to your Lender for a home mortgage loan leads you inevitably to the closing attorney's office. You undoubtedly have questions as to what the role of the closing attorney is, what tasks the closing attorney will perform and what will take place at the closing. First, understand that the closing attorney represents the interests of the lender. If your loan is a standard secondary market type loan the loan transaction and loan documentation are uniform throughout the state.

At our firm it has always been our practice to be as helpful as we can to assist borrowers in the mortgage loan transaction. Sometimes issues arise regarding the record title to a property. If there are title issues, problems in a sale transaction, or issues involving inaccuracies, we endeavor to keep the borrower informed of all relevant issues. When possible, we seek to resolve title issues and disputes, many times without any additional fees. This usually insures that the loan and, if applicable, the sale of the property being mortgaged, proceeds forward to close with the borrowers being satisfied with the result.

The closing fees quoted to you by your Lender include a variety of items. Those which involve our office include the following and are standard transactional items for representing the lender in residential loan transactions:

Legal Fee - Includes ordering and obtaining a title examination from title examiners at the various Registry of Deeds, title review, obtaining municipal lien information & survey information, loan document preparation, title certification ( if a purchase transaction ), communications with borrowers, sellers, broker, etc., conducting the closing, final rundown of title, recording of documents, payoff of liens and sundry other matters relating to the loan closing.

Title Abstract - Includes the physical review of the title to your property in the Registries of Deeds and Probate, including bankruptcy and tax matters where available.

Mortgage Survey Plan - Sometimes referred to as a plot plan, this is a tape measure survey of the land to be mortgaged in order to determine that it was not in violation of zoning when constructed and that no buildings or improvements encroach upon the property or over its lot lines. We may not have been instructed by your lender to order such a plan for this transaction. However, we do recommend that one be obtained in a purchase transaction and in such instances we will obtain one in any event for your protection. In a Condominium transaction we will generally not obtain such a plan.

Municipal Lien Certificate - Obtained from the city or town where the property lies, this document shows all outstanding tax and utility liens.

Title Insurance - The lender requires a loan policy of title insurance for the loan amount in order to protect their interests from issues relating to the title to the property that could not be determined from an examination of the record of the title. In a purchase transaction an owners policy can be purchased at the same time at substantial savings over the rate if not issued simultaneously with the loan policy. Owners title insurance is highly recommended by our office. We can supply you with information regarding this insurance and the cost.

Recording Costs/Courier & Certified Copy Fees - These include the cost to courier the mortgage payoff and loan documentation for safe and timely delivery, to record the mortgage and other transactional documents and obtaining Registry certified copies that may be required in certain transactions.

This is a list of some of the items that you may be asked to pay for in a normal residential loan transaction. In some instances your Lender may pay some or all of these costs if your loan program so prescribes. This explanation should serve as a brief overview of the items described above. For a further explanation please contact our office.

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TITLE INSURANCE AND ITS IMPORTANCE IN YOUR TRANSACTION

Real estate title insurance very simply is an insured statement of the conditions of one's title or ownership rights to a certain piece of real estate. The policy guarantees that the property being purchased or mortgaged is free from undisclosed liens or rights and it guarantees additionally that any confusion as to rights of ownership will be resolved in favor of the party owning the real estate or the title insurance company will be liable for loss in value to the policyholder up to the policy limits.

A buyer purchasing real estate is offered the opportunity to purchase an owner's policy of title insurance by the settlement agent, attorney, escrow company or title agent conducting the real estate closing. For example, you decide to purchase a house in Boston and are obtaining a mortgage to help you finance the purchase from a bank or mortgage company. That institution will require an examination of the title to the property and have the party reviewing the title issue to them a lender's policy of title insurance insuring that the property is or will be owned by the purchaser and that there are no defects, liens or encumbrances on the property which would adversely affect the marketability of its mortgage.

Since the settlement agent, attorney, escrow agent or title agent is already issuing a lender's policy of title insurance the buyer has the opportunity at that time to obtain an owner's policy of title insurance at a cost substantially less than the buyer would pay if the policy was not written simultaneously with the lender's policy. The owner's policy of title insurance insures that the owner has good marketable title to the property free of any encumbrances or liens that would adversely affect the property, except those made known to the buyer, and insures to the owner that if any such liens, encumbrances, defects or other title problems become known the title insurer will defend the buyer's title to the property.

In many instances we are asked whether or not title insurance is necessary or advisable for the owner to purchase. We recommend the purchase of the title insurance for some very simple reasons. First, the premium for purchase of the title insurance policy is a one time charge. Since the purchaser is usually borrowing money to finance the purchase, the majority of the cost of the title insurance policy that the owner would receive has been paid through the premiums for the lender's policy which is required by the loan. Usually for a few hundred dollars or less the owner can insure against a variety of problems which could occur in the future. These items include forged documents in the chain of title, signatures of mentally incompetent persons or minors which are unknown to the party reviewing the title, mistakes or inaccuracies in recording of legal documents of title at the appropriate place or recording or registration of title, fraud in the execution or in the handling of the recording or indexing of recorded documents, undisclosed or missing heirs, fraud in the execution or in the handling of a transaction in the prior chain of title, invalid divorces or misrepresentation of marital status of the parties signing the documents, and most importantly clerical errors in the public records and claims of parties unknown because their claims have not been filed in any indices of public record. The enhanced policies such as First American’s Eagle Policy go well beyond these simple coverages and provide coverage for a host of issues that can affect property both prior to and after you purchase it.

Even though the buyer may be asked to pay for the lender's title insurance protection, the lender's policy of title insurance does not protect the buyer and a claim can only be made if the lender suffers a financial loss because of a title defect that adversely affects a foreclosure of the buyer's mortgage. There have been many of defects in titles which could not be revealed by an examination of the public records. These defects usually arise at a time after the transaction has taken place and purchasers can suffer significant losses as a result of them. That is why owner's title insurance makes a great deal of sense.

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27 Mica Lane, Suite 206   |   Wellesley, MA 02481   |   Tel: 781-431-8776   |   Fax: 781-465-6068   |   admin@killeenlawoffice.com

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First American Title Insurance Company
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