Refinancing in the mortgage world is the process of replacing an existing home loan with a new one that has more favorable terms. Much like an initial loan obtained for the purchase of a home, loan settlement or closing proceedings are part of the refinancing process. Read on to learn more about refinance closings and what you can expect with this type of settlement procedure.

What are the key components of refinance closings?

Refinance closings are the final step in the process of refinancing a loan, and they involve signing all of the necessary documents to complete the transaction. Here are some additional things you should know about refinance closings:

Closing costs

Refinancing often comes with closing costs, which can include fees for things like appraisals, title searches, and loan origination. It’s important to understand these costs and factor them into your decision to refinance.

Timing

Refinance closings typically take between 30 – 45 days to complete. However, this can vary depending on the complexity of the loan and the lender’s processing time. It is important to plan ahead and be prepared for any delays that may occur.

Benefits

Refinancing can offer a variety of benefits, such as lower monthly payments, a lower interest rate, or a shorter loan term. However, it is important to carefully consider the potential benefits and drawbacks before deciding to refinance.

How do refinance closings work?

While the process for refinance closings may vary from lender to lender, there are a series of steps generally involved in the process. These often include:

1. Loan approval: Before a refinance closing can take place, the new loan must be approved by the lender. This involves providing financial information, such as income and credit history, and waiting for the lender to review and approve the new loan.
2. Schedule the closing date: Once the new loan is approved, a closing date will be scheduled. This is typically done by the lender, and you will be notified of the date and time of the closing.
3. Finalize the loan terms: Before the closing, you will receive a Closing Disclosure that outlines the final loan terms, including the interest rate, loan amount, and closing costs. You should review this document carefully and ask questions if there is anything you do not understand.
4. Sign the documents: At the closing, you will be required to sign a variety of documents, including the new loan agreement, a truth-in-lending disclosure, and a HUD-1 settlement statement. Make sure you review these documents carefully and ask questions if there is anything you do not understand.
5. Payment of closing costs: Refinancing often comes with closing costs, which can include fees for things like appraisals, title searches, and loan origination. Most often, no fees are required upfront and are rolled into the loan.
6. Funding of the new loan: Once all the necessary documents have been signed, the lender will typically fund the new loan within the fourth business day (if the property is a primary residence). This means that the old loan will be paid off and the new loan will take effect.

Overall, refinance closings are a critical step in the refinancing process, and it is essential to carefully review all documents and understand the terms of the new loan before signing. To learn more about the refinance closing process in Virginia Beach, VA, please contact Linear Title & Escrow.

How are closing costs calculated?

Typically, closing costs are calculated as a percentage of the total sale price of the property and can range from 2% to 5% of the purchase price. However, this can vary depending on the specific transaction and the state or local laws in the area.

It is important to review the closing cost estimate provided by the lender to understand the specific costs associated with a particular transaction. This is included in the Closing Disclosure (CD) form, which should be submitted by the lender to the buyer no later than three business days before the scheduled closing.

How are closing costs paid?

To learn more about closing costs when buying a home or to partner with an experienced title company in Virginia Beach, VA, please contact Linear Title & Escrow.

The term “title” in real estate refers to the ownership aspects of a property. Title defects are any problems or issues that affect the ownership rights or transfer of a property. Left unresolved, these factors can create complications with the real estate sale and may even stall the closing process.

Some of the more common title defects in real estate include:

1. Liens: Liens are legal claims against a property for unpaid debts or taxes. Liens can be placed on a property by a lender, the government, or a contractor.
2. Encumbrances: Encumbrances are any burdens or restrictions on a property’s title, such as easements, covenants, or deed restrictions. These can limit the property owner’s use of the property or affect its value.
3. Errors in public records: Errors in public records, such as mistakes in property descriptions or recording errors, can create problems with a property’s title.
4. Unknown heirs: If a property owner dies without a will, their heirs may not be immediately apparent. This can create complications when attempting to sell or transfer the property.
5. Forged documents: If any of the documents involved in a property’s ownership or transfer are forged, this can create a cloud on the property’s title.
6. Invalid deeds: A deed that is improperly executed or not legally binding can create a title defect.
7. Boundary disputes: Disputes over a property’s boundaries or ownership can create title defects.
8. Unreleased mortgages: If a mortgage has been paid off but not properly released, it can create a lien on the property.
9. Missing interests: A property’s title may be incomplete if there are missing interests, such as an owner who was not properly included in a previous transaction.

It’s important to have a thorough title search conducted to identify any potential defects before purchasing a property.

How are title defects found?

Title defects can be found in a few different ways, depending on the circumstances. Here are some common methods:

1. Title Search: A title search is typically conducted by a title company or an attorney to identify any potential issues with the title of a property. This search generally involves a review of public records, such as deeds, mortgages, liens, and judgments, to ensure that the title is free and clear of any encumbrances or defects.
2. Survey: A survey of the property can also help identify potential title defects, such as encroachments, boundary disputes, or easements that may not be reflected in the public records.
3. Property Inspection: A physical inspection of the property can also help identify potential title defects, such as unpermitted structures or improvements that may impact the title.
4. Disclosures: In some cases, title defects may be disclosed by the seller or other parties involved in the transaction, such as a homeowner’s association or government agency.
5. Title Insurance: Title insurance is designed to protect against losses arising from title defects. As part of the title insurance process, the title company will typically conduct a title search to identify potential issues with the title. Title insurance can provide coverage against losses resulting from those defects.

What happens when a title defect is discovered?

When a title defect is discovered, it can potentially have serious consequences for the ownership and sale of the property. If a title defect is identified, one or more of the following may occur:

1. Resolution of the defect: Depending on the nature of the defect, it may be possible to resolve the issue by taking corrective action. For example, if there is a lien on the property, the lienholder may agree to release it upon payment of the debt.
2. Negotiations: If the defect is significant, it may be necessary to negotiate with the other parties involved in the transaction to determine the best way to proceed. This may involve renegotiating the terms of the sale or working out an agreement to resolve the defect.
3. Legal action: In some cases, it may be necessary to take legal action to clear up the title defect. This could involve filing a lawsuit to quiet title or challenging the validity of a lien or other encumbrance on the property.
4. Title insurance claim: If the defect is covered by title insurance, a claim can be filed with the title company to cover any losses resulting from the defect. The title company may take steps to resolve the issue or provide compensation to the owner for any losses incurred.
5. Sale delay or cancellation: If the title defect cannot be resolved, it may be necessary to delay or cancel the sale of the property. This can be frustrating for all parties involved, but it is important to ensure that the title is clear and that ownership of the property is properly transferred.

For more on title defects or how these issues might be resolved, please contact Linear Title & Escrow in Virginia Beach, VA today.

For most Americans, purchasing real estate is among the biggest financial investments they will make in their lifetime. To help safeguard such a valuable asset, buyers typically purchase homeowner’s insurance to protect against financial loss should a natural disaster or other unfortunate event impact the home or its assets.

But what if another party is able to claim an ownership stake in the property? Such a claim would be the result of a “title defect,” and would not be covered under homeowner’s insurance. An owner’s title insurance policy, however, could help protect the homeowner should title defects arise weeks, months, or even years after they have purchased the home. Read on to learn more about owner’s title insurance and whether or not it is required when purchasing real estate.

What Is Title Insurance?

Title insurance is an indemnity policy designed to protect a party’s financial interest in a given property should a valid claim threaten their ownership rights. There are essentially two forms of title insurance: lender’s title insurance and owner’s title insurance. Lender’s insurance protects the mortgage lender in the event the loan becomes unenforceable during the repayment period. Owner’s insurance protects the homeowner should title defects surface any time after they close on the home.

There are a wide variety of title defects that may occur. Some of the most common include recording errors, improperly probated wills, liens, judgments, and unreleased deeds of trust. While recording errors and other types of defects may be relatively easy to resolve, others could be costly and incur legal fees. An owner’s title insurance can help mitigate such costs.

What Are the Benefits of Owner’s Title Insurance?

Owner’s title insurance provides several key benefits. It can help cover legal fees should it become necessary to defend ownership rights in a court of law or remunerate the homeowner if the property is lost to a valid ownership claim. An owner’s policy will remain in effect until either the homeowner or their heirs no longer own the property. In all, it can help provide lasting protection and peace of mind.    

Do I Have to Buy Title Insurance?

Most lenders require a homebuyer to purchase a lender’s insurance policy at the time of the real estate sale. Owner’s title insurance is entirely optional. However, it is highly recommended for the reasons listed above. Both premiums are remitted in a one-time payment at the time of closing. Visit our title insurance page to learn more about these types of policies.

Learn More About Title Insurance

Buying a home is a major milestone in a person’s life. Title insurance can help protect their investment and safeguard this valuable asset. To learn more about title insurance, please contact Linear Title & Escrow in Virginia Beach, VA today.

A title search is a very thorough investigation into the ownership history of a given property. It is a process performed to examine the chain of ownership and proper transfer of title from one party to the next and the current homeowner’s legal rights to sell the property. A title search investigates for title defects or circumstances that may prevent the legal transfer from the seller to the buyer.

Integral to a real estate transaction (in most cases), a title search is an important part of the closing process and can help protect the buyer when purchasing a new home. We have put together some of the most frequently asked questions about the title search process to help further explain the relevance of this essential step.

Who conducts a title search?

A property title search is generally performed by a title agent or representative of the company or attorney conducting the real estate closing. These professionals are trained to identify title defects and access the appropriate resources to research the chain of ownership surrounding a real estate property.

When does a title search take place?

Title searches are typically performed shortly after the real estate contract is ratified. In most instances, a title search must be completed before the lender will approve the home loan. Along with protecting the buyer, this process helps safeguard the lender’s interest against risks associated with title defects.

What does a title search include?

A property title search includes an examination of public records, screening for information on deeds and any judgments, liens, boundary disputes, improperly probated wills, bankruptcy, and more. Title agents also review the mortgage history, tax payments, and other legalities surrounding the property. Any encumbrances identified during a title search are classified as title defects.

How long does a title search take?

On average, a thorough title search takes about five days to complete. This timeframe, however, may be impacted by the age of the home. Titles for older homes may take longer to investigate since they are more likely to have had multiple owners while those for newer properties may not require as much time to research.

What happens when title defects are found?

Title defects must be resolved before the home closing can occur. Some title defects can simply be resolved by submitting the correct or updated information to the public records office or appropriate entity. Other defects may be more complex and entail resolution in a court of law.

A title search confirms a seller’s legal right to sell a property free and clear and is a crucial step in a home closing. To learn more about title searches or the closing process in general, please contact Linear Title & Escrow in Virginia Beach, VA.

Closing costs are the fees paid when closing on a real estate sale or refinance transaction. Remitted at the time of settlement, these costs are those associated with the buying or selling of a home and exist outside of the down payment. Whether you’re a first-time or seasoned home buyer, it’s important to know what your closing costs will be when making your real estate purchase. Read on to learn what fees are included in closing costs and how those fees are determined.

What do closing costs include?

Both home buyers and sellers can expect to pay settlement costs at the close of the real estate transaction (when the property is officially and legally conveyed from the seller to the buyer). The details surrounding closing costs for both parties are contained within the Closing Disclosure (CD) form, a document remitted to the seller and buyer three business days prior to the closing date.

Buyer closing costs generally include:

-Loan origination fee (if applicable)

-Credit report review

-Home appraisal 

-Pre-paid mortgage interest (discount points)

-Private mortgage insurance (PMI) (if applicable)

-Homeowner’s insurance

-Recording fees

-Underwriting fees

-Courier fee

-Transfer taxes

-Title search and closing fee

-Title insurance

-Land survey (optional)

-Flood determination and elevation certificate (if applicable)

-HOA dues (if applicable)

Seller closing costs typically involve:

-Mortgage pay-off amount

-Property taxes

-Deed preparation

-Grantor’s tax

-Hampton Roads Regional Transit (HRRT) fee (if applicable)

-Settlement/Closing coordination fee

-Notary fee (if applicable)

-Home repairs/invoices (if applicable)

-Termite inspection (if, per contract, the seller is to pay)

-Home warranty (if applicable)

-Prorated HOA fees (if applicable)

-Prorated real estate taxes

-Prorated stormwater fees (if applicable)

-Real estate commissions

How are closing costs determined?

In general, closing costs for home buyers range between 3 – 6 % of the sale price of the home and may be affected by the sale price of the property, the geographic location of the home, and the home buyer’s credit standing, among other factors. These expenses may also vary based on the type of mortgage product selected and according to state or municipality.

Closing costs for sellers generally fall between 5 – 10 % of the sale price of the home, the largest of which is often the commissions paid to the real estate agents. Any remaining mortgage expense is paid alongside other seller closing costs. Seller expenses may also vary according to state or municipality.

Can closing costs be negotiated?

In some instances, home buyers and sellers may negotiate the terms of the real estate contract to include seller assists or concessions, which is where the seller contributes a specific amount towards closing expenses on behalf of the buyer. The total amount of contributable seller concessions allowed, however, may be dictated by the type of mortgage product for which the buyer has applied.

Do you have other questions about closing costs or the settlement process? Reach out to Linear Title & Escrow in Virginia Beach, VA today!

Knowing what to expect as you embark upon buying a new home can help ensure you are fully prepared when it is time to close. On average, it takes approximately 30 – 45 days to complete the settlement process, from start to finish. Here is a general overview of the main steps involved when buying and closing on a home.

Loan Pre-Approval

The first step in the home buying and closing process is to have a home loan pre-approved by a reputable mortgage lender. Ensuring the submission of the necessary documents and information required for loan approval in a timely manner is crucial to keeping the closing timeline on track and as short as possible.

Contract Ratification

Once the terms of the sale have been agreed upon by both the buyer and the seller and the real estate contract has been signed, it is considered to be “ratified.” It serves as a legally binding agreement and will typically include pertinent information, such as the purchase price and estimated closing date.

Title Search

Following contract ratification, a title search will be conducted by a title agent. A title search is a thorough investigation of the ownership history of the property and is performed to identify any title defects. A title defect is a legal circumstance that prevents the proper transfer of ownership from the seller to the buyer. Title defects must be resolved in order for the real estate sale to take place.

Clear to Close

A “clear to close” status indicates that the lender has fully approved the home loan and that all necessary conditions and documentation requirements for the transaction have been met. At this stage, a closing date and time will be confirmed by the title company conducting the settlement.

Closing Day

Closing day is the final step in the real estate transaction. Buyers and sellers each have their own separate closings, during which the final loan documents and other relevant paperwork are signed and notarized. Once closing is complete, the buyer is legally the new owner of the property.

If you are seeking a title company in Virginia Beach, VA, we invite you to contact Linear Title and Escrow. Our seasoned team can help you understand the steps involved in the closing process and enjoy the best possible settlement experience.

Title defects are factors relating to a real estate property that prevent a clear and free transfer of ownership from one party to the next. Also referred to as “clouds on title,” such defects can interfere with a homeowner’s ability to sell their property or may give rise to the need to defend their property against others who retain ownership rights. Any title defects that are identified must be addressed and corrected before the property can be legally and properly sold and transferred.

How Are Title Defects Found?

Title defects are generally identified during a title search. This investigative process is conducted during the time between contract ratification and the closing proceedings. A title search involves a very thorough, detailed evaluation of the property’s chain of ownership history and usually begins by reviewing public records. The title examiner searches for judgments, liens, unpaid taxes, and any other encumbrance that could prevent the sale of the property and legal transfer of ownership.

What Are Some of the More Common Types of Title Defects?

There are a wide variety of factors that can render the title of a property defective. Some of the most common title defects include:

– Forgery

– Fraud

– Impersonations

– Improperly probated wills

– Property liens

– Judgments

– Boundary disputes

– Encroachments or easements

– Recording errors

– Unreleased deeds of trust

– Unidentified heirs

How Are Title Defects Cleared?

The title defect resolution process is dependent upon the type of problem at hand. Once a defect is found, the examiner conducts title rectification procedures to resolve the issue. Some types of defects can be resolved relatively quickly and simply involve submitting the correct information to the public records office (such as for clerical or recording errors).

With other issues, such as unreleased deeds of trust, the title company may need to contact the previous lien holder (mortgage lender) to initiate the title resolution process. Liens, unpaid taxes, judgments, and other debt-related defects must be paid in full and the receipt of payment recorded to clear these types of title problems. Undisclosed heirs, boundary disputes, improperly probated wills, and other complex forms of defects may require legal action or need to be resolved in a court of law.

Can I Protect My New Home Against Title Defects?

Title examiners are trained to conduct thorough title searches and detect clouds on title. Even with a comprehensive investigation, however, there may still be undiscovered defects that surface months or even years post-closing. Homebuyers can purchase an owner’s title insurance policy at the time of closing to help safeguard against title defects. This type of indemnity policy can help protect against loss of property or financial loss should a defect arise or if another party proves to have ownership rights to the property. Owner’s title insurance can also help cover legal fees in the event such action is necessary to clear clouds on title.

Learn More About Title Defects

Defects can render the title of a home unmarketable and may even threaten the real estate sale. If you have further questions about clearing title defects, Linear Title & Escrow can help.  Please contact our title company in Virginia Beach, VA today to learn more.

Whether you’re a buyer or a seller, closing on a home is a momentous life event. In many instances, the closing (or settlement process) for the real estate sale is conducted by a title agent or representative of a title company. Read on as we provide a general overview of the title company’s role in a real estate transaction.

About title companies

Title companies are business organizations that conduct home closings on both sides of the real estate transaction. A home closing is the process of transferring ownership of a property from the seller to the buyer and finalizing the home loan (mortgage) paperwork. Unless handled by a real estate attorney, closings are conducted by a title agent, often onsite at the title company office.

Title companies serve as neutral third parties to facilitate the closing process between buyers, sellers, mortgage lenders, realtors, and other professionals. From conducting title searches to issuing title insurance policies, title companies are an integral part of the real estate sale.

What is a title search?

A title search is the process of reviewing the ownership chain of a given property to determine if any title defects exist. Title defects are issues or problems with the title of a property that could interfere with an owner’s right to sell the property free and clear. A title search should involve the thorough examination of public records, screening for judgments, liens, recording errors, unpaid taxes, encumbrances, and a variety of other factors. Title defects discovered during the process of a title search (generally) must be resolved before closing can occur.

What is title insurance?

Title insurance is a type of policy designed to protect homebuyers and lenders against financial loss from title defects should any be identified after closing has occurred. There are two types of title insurance policies: an owner’s title insurance policy (which protects the homeowner) and a lender’s policy (which protects the mortgage lender). Visit our title insurance page to learn more about these indemnity policies.

Can I choose the title company for my home closing?

The ability to choose a title company can vary among states. In Virginia, however, the buyer has the right to choose the title company for their home closing.

Finding the right title insurance company for your closing can contribute to a positive settlement experience. If you are searching for a title company in Virginia Beach, VA to handle your home closing, our team at Linear Title & Escrow can help. Please contact us today to learn more.