Understanding your mortgage options is key to getting the right type of financing for your home. Whether you’re a first-time homebuyer, seasoned pro or current homeowner looking to refinance, there are several options to consider when it comes to mortgage products.

Know Your Options

It’s always important to consult with a qualified expert when deciding on the best mortgage option for your current situation and needs. The following information provides a basic overview of key elements surrounding each home loan type.

Conventional Loans

• Repayment terms typically 15, 20 or 30 years in length
• Interest rate may be fixed or adjustable
• Good credit score (620 or higher) usually required (credit score requirements vary among lenders)
• Usually require down payment of 5% of purchase price or higher
• Down payment amounts less than 20% of purchase price require Private Mortgage Insurance (PMI)
• Not insured by the Federal Government
• Follow mortgage guidelines established by Freddie Mac and Fannie Mae

 VA Loans

• Designed to help those eligible obtain competitive interest rates
• Guaranteed by the United States Department Veterans Affairs
• Good credit score (620 or higher) usually required (some lenders may allow credit scores as low as 580)
• Repayment terms typically 15 or 30 years in length
• Interest rates may be fixed or adjustable
• No down payment or PMI required
• Only service members, surviving spouses of service members and veterans may apply (must have VA eligibility to qualify)

 Adjustable Rate Mortgages (ARMs)

• Introductory repayment period features lower interest rate
• Interest rate and payments following initial repayment period typically adjusts on a yearly basis (rates are influenced by major indexes)
• Repayment terms often 15 or 30 years in length
• Terms of loan are typically 3/1, 5/1, 7/1 or 10/1

FHA Loans

• Backed by the United States Federal Housing Administration
• PMI required for the life of the loan
• Credit score of 580 or higher often required (500-579 may be accepted if higher down payment applied – credit score requirements are lender-specific)

Please note that fees, terms, credit requirements and closing costs vary among loan types and as influenced by other factors. Contact a mortgage professional for exact details on each type of loan.

Have questions about the closing process and your specific loan type? Contact Linear Title & Escrow today!

Title defects present a barrier to transferring ownership of a property from one party to the next. Until resolved, these road blocks prevent the clear-to-close on a real estate transaction. Though there are numerous types of title defects that can occur, we finish our three-part series with a look at how some of the more common types of problems are resolved. Review Part One and Part Two of our series to learn more on clearing other types of title defects.

1. Boundary Disputes: This situation sometimes occurs if a survey is requested by the buyer. To mitigate a boundary discrepancy, the title agent confers with the seller’s side to determine the exact nature of the dispute. The process starts by reviewing the legal survey, and working to ascertain at what point the dispute developed and why. The seller must then take care of any encroachments prior to closing. In instances where the seller and neighboring landowners concur to allow mobile or immobile structures to remain in place, a written agreement must be signed by the current owner and neighboring party. The buyers must be informed and approve of the arrangement as well. If the encroachment has occurred over a long period of time, the seller and their representative may attempt to reestablish clear title through adverse possession. These types of disputes typically are resolved by legal representation through the court system.

2. Incorrect Representation of Marital Status: When title search reveals misrepresentation of marital status on a deed, the settlement office or attorney who prepared the deed must work to resolve the defect. This is performed by filing a deed of correction, or quit claim deed, through the Clerk of Court’s office.

3. Zoning and Easements: These types of title concerns often involve requesting a letter of compliance from the zoning office in the local municipality. Typically, the seller’s representative must request a new survey, and submit it to the Land Recording Office. In the case of a private easement, the property owner must work with the utility company to have it identified and described on an updated land survey.

Protect Your Interest With Title Insurance

Title insurance is your best method of protection against title defects. Having an Owner’s Title Insurance Policy covers legal and other costs of correcting clouds on title, and gives you peace of mind when title defects threaten your real estate investment.

Our friendly, knowledgeable team is always ready to assist! Contact Linear Title & Escrow today for more on title defect resolution.

In our last post, we offered a general overview of how three of the most common title defects are resolved: clerical errors or omissions, unreleased deeds of trust, and judgments or liens. Here, we’ll provide insight into how we clear title for a number of other title problems.

Clearing Clouds on Title: Other Common Defects

Title defects must be resolved prior to closing on a property. Some title defects are simply a matter of filing corrective paperwork, and are relatively easy to resolve. Other defects, however, may require more time and process to clear.

1. Forgery and Fraud: Clearing up forgery and fraud defects is very much scenario-driven, as with many types of title problems. In such cases, legal counsel typically is the appropriate course of action. When a title agent discovers a forged deed or fraudulent circumstances surrounding property ownership, he or she contacts the seller’s side of the transaction to relay the information. The current property owner must then seek the assistance of a real estate attorney to correct the defect through the court systems.
2. Improperly Probated Wills: If a property owner dies intestate or with long-lost heirs, an amended list of any and all heirs must be refiled with the Clerk of Court to reflect the accurate chain of ownership. In such a case, the seller’s representative (or Executor of Estate) must resolve this issue with probate court before moving forward with the sale on the property.
3. Incorrect Legal Descriptions: The manner in which the incorrect description was recorded dictates how this type of defect is resolved. For example, deeds that contain an erroneous number, letter or other information due to typographical error are typically resolved by submitting an affidavit to the recording office (explaining the error). In cases where a deed doesn’t describe the land to which it’s attached, or describes another piece of property altogether, a corrective deed must be submitted. Such a defect often can be resolved rather quickly.

*Note: The information presented here represents examples of individual title defects, and in no way provides a comprehensive description of details surrounding title defect resolution. This information is meant to provide a general idea of how title companies and other parties work to resolve title problems.*

Title Insurance

In each of the title defect cases mentioned here, Owner’s Title Insurance is the best defense against losing your property, and ultimately your financial investment.

Check back in for the third, and final, post of our title defect resolution series!

Have other concerns over title defects, or questions about protecting your real estate investment with title insurance? Contact Linear Title & Escrow today!

When it comes to purchasing a new home, ensuring the title is defect-free, or “marketable,” is of extreme importance. In fact, the outcome of the real estate transaction hangs in the balance of title, or ownership claim, to a property. In many cases, the title search returns free and clear, allowing the parties to move forward with the settlement process. Some title searches, however, reveal snags in the chain of title, halting the transfer of ownership from one party to the next until the discrepancies are resolved.

In this first portion of a three-part series, we’ll review some of the most common title defects, and how each typically is resolved. As with several aspects of real estate and title, certain situations fall beyond the commonalities presented here, and require additional time or modalities to affect defect resolution.

Common Title Defects and Resolution Processes

1. Clerical Errors or Omissions: When clerical or recording errors or omissions are identified, the title company or agent handling your closing works to correct the issues as quickly as possible. This typically involves contacting the party who committed the error and obtaining clarification of the correct information. However, the manner in which this happens varies, depending on the type of error or omission. For instance, in the case of an incorrect legal description, the settlement agency would request a deed of correction from the party who generated the deed. The correction is then filed with the clerk of courts, upon which the proper information is recorded and the defect resolved.

2. Unreleased Deeds of Trust: In this situation, a deed of trust (from a prior owner) is still attached to the property, and yet to be released by the Land Records Office. To resolve this type of title defect, the settlement agent must contact the lender who held the mortgage lien or title company who conducted the closing (in the case of a refinance), then file the appropriate paperwork with the court. Unreleased deeds of trust are extremely common title defects, and usually easily resolved.

3. Judgments and Liens: Judgments or liens, such as mechanic’s liens, HOA liens and tax liens, against a property must be satisfied to release title for transfer of ownership. These typically arise when a seller (or previous property owner) has failed to pay off a lien filed against the property in question. Resolution of this type of defect varies, according to both the circumstances surrounding the judgment or lien and the amount of time it has been attached to the property. In general, however, the seller must satisfy the judgment or pay off the line to clear the defect from the title.

Best Defense Against Title Defects

In some cases, title defects may go undetected, only to be discovered at a later date, when a property is in the process of changing ownership. The best way to protect your financial interest in your property is to to purchase an Owner’s Title Insurance policy at the time of closing. These types of policies help mitigate your risk of financial loss and cover the cost of restoring clear title.

Stay tuned for part two of our Title Defect Resolution series!

Our team at Linear Title & Escrow is pleased to answer your questions regarding title defects or other closing concerns. For more information, contact us today!

When it comes to real estate, it’s important to ensure a clear, or “marketable,” title on a property. A clear title is one without defects, or in which problems with ownership claims are discovered and rectified prior to closing on the home. A title examiner, or abstractor, conducts an investigation into a property’s chain of title, to determine if any issues are obstructing the way of declaring the transfer of ownership free and clear.

Common Title Defects

A vast array of problems may affect title on a property. Some of the most common include:

• Forgery
• Clerical errors
• Unreleased deeds of trust
• Judgments
• Liens
• Improperly probated wills
• Fraud
• Incorrect legal descriptions

The Process of Title Search

A title search is conducted for the purpose of ensuring a homeowner has an unencumbered right to sell their real estate, and takes place early on in the real estate transaction. Once a contract is ratified and received by a title company or closing agency, the title investigation is initiated.

Searching a title for defects begins with thorough research into the past 60 years of history on a property, and ends when the title abstractor/examiner delivers the title report to the closing agent. (If a title is not deemed clear upon completion of a title search, the title agency works to resolve any identified defects.)

In general, the title search process takes about two to four business days to complete, and progresses as follows:

1. Searching Public Records Database – The title examiner conducting the investigation typically begins by examining the chain of title and deed transfers through public records.
2. Searching Indexes – In certain cities and counties, the examiner must physically visit the courthouse to search through indexes that are not of public record.
3. Searching Chancery Court – Occasionally, and if applicable, an examiner further investigates for title defects through the chancery court system, to identify any issues that may be stalled by circuit court judgments against the property’s ownership. Such cases may include transfer of title to heirs through wills/trusts and land disputes, among others.
4. Summary of Title – Once the title search is complete, the examiner sends a Summary of Title to the closing agent.

Have questions on title search or other closing processes? Contact the Linear Title & Escrow Team today!

In our last post, we discussed four factors of importance surrounding title insurance. We also reviewed why it’s so important to have an Owner’s policy to protect your investment and interest in a property as a homeowner. But are all Owner’s Title Insurance policies the same? If not, what’s the benefit of one type over another?

A Reminder About Owner’s Title Insurance

No matter how new or old a property is, there’s always the risk of clouds on title, or defects. As a refresher, title insurance protects the policyholder against financial losses in the event of title problems or ownership claims to a property. While most Lender’s require homeowners to purchase a Lender’s Title Insurance policy to mitigate any potential losses against their investment, having an Owner’s policy is optional – but highly recommended. Owner’s policies are underwritten with either Enhanced or Standard coverage.

Comparing Enhanced vs. Standard Policies

Though both protect the homeowner against title problems in some regard, reviewing the benefits of Enhanced vs. Standard Owner’s polices really is an apples-to-oranges comparison. An Enhanced policy offers greater protection over a number of title defect categories, when compared with a Standard plan. To make the best decision in your own situation, it’s important to understand how these policies are similar, and how they differ.

Both Standard and Enhanced Title Insurance policies offer coverage for the following:

• Easements or other land rights not listed on your policy
• Ownership stake on your property
• Inability to sell or secure a loan due to unmarketable title
• Lack of pedestrian or vehicular access (Standard policy covers legal access only)

Here’s where they differ. An Enhanced policy offers greater title defect coverage, including in such instances as:

• Forgery after the policy date
• Damage due to easement use
• Existing restrictive covenant violations
• Zoning and subdivision violations
• Encroachments

*It’s also important to note that with Enhanced Title Insurance, the policy coverage amount increases yearly to keep pace with property value increase (10% per year, up to 150%).

The Right Policy for Your Needs

Owner’s Title Insurance offers homebuyers peace of mind in knowing they’re covered for potential unexpected title discrepancies, and even more so when choosing an Enhanced policy. While the cost of Title Insurance varies based on sales price, the difference between the Enhanced and Standard Policy usually is only a matter of a few hundred dollars – a small price to pay for covering one of your greatest assets.

At Linear Title & Escrow, we are dedicated to helping you determine the best type of policy for your needs. Our team wants you to understand your options, and takes the time to explain the similarities and differences in policies so that you can make the right decision when it comes to protecting your real estate investment.

Have questions about Title Insurance? We have the answers you need! Contact us today at (757) 340-0340.

4 Things to Know About Title Insurance

What is title insurance, and why should you have it? If you’re new to the home buying experience, “title insurance” is a term you’ll hear at some point during the real estate transaction process. Title insurance is a type of policy that protects against monetary loss due to previously undetected problems or defects on a property that arise after closing. In such a situation, title insurance saves the policyholder from losing money on their investment, time in court and the trouble of having to clear title issues.

What Should You Know About Title Insurance?

Since title insurance is such an important component of buying a home, it’s important to at least have a general idea of the basics surrounding these types of policies. Here are four things to know about title insurance:

1. Lender’s and Owner’s Title Insurance fall under different policies. Lender’s almost always require the home buyer to purchase Lender’s Title Insurance. An Owner’s Policy is not mandatory, but highly recommended.
2. Lender’s Title Insurance protects the mortgage lender’s financial interest in the property. It does not cover losses suffered by the homeowner.
3. Owner’s Title Insurance guards against the homeowner’s real estate investment. It protects against financial loss, covers legal costs of defending title and mitigates the emotional expense of having to contend with title defects, or someone able to lay ownership claim to your property after closing takes place.
4. What does an Owner’s Title Insurance policy protect against? Effective for as long as you own the property, an Owner’s policy safeguards against title defects like:

• Incorrect legal descriptions
• Improperly probated wills
• Unidentified heirs
• False impersonation
• Fraudulent execution of documents
• Incorrect delivery of deeds
• Recording errors or omissions
• Clerical errors
• Forgery

*This is not a comprehensive list of potential title defects. A number of issues can cause title problems. For more on this topic, please visit our Title Insurance page, or contact your title agent, real estate agent or real estate attorney for additional information.

Want to learn more about Title Insurance Policies? Contact the knowledgeable team at Linear Title & Escrow today!

Whether you’re a first-time homebuyer or seasoned pro, it’s always essential to be prepared throughout every step of the real estate transaction. And since closing on the home represents the consummation of your home buying experience, it’s important to know what to expect and how best to prepare.

Steps to Home Ownership

Let’s first take a general look at how the home buying process works. Here’s what takes place after you’ve made an offer on a home and it’s been accepted by the buyer:

1. Mortgage application process
2. Home inspection
3. Home appraisal
4. Walk-through
5. Closing

The Days Leading Up to Closing

While preparing for your home closing begins in the early stages of the home buying process, the few days leading up to your settlement date are when timely preparatory efforts are key. Your lender will send you a Closing Disclosure (CD) Form at least three business days prior to your scheduled closing.

The CD contains details regarding your mortgage, including mortgage terms and fees, as well as your closing costs. Take time to compare this document to the Loan Estimate you received earlier in the process. It’s extremely important to review the CD carefully, and follow up with your lender promptly if you have any questions or concerns. Waiting to do so may result in your closing being delayed.

What to Expect the Day of Closing

You’ll be contacted with your final figures prior to closing, either by your lender or settlement agent.

1. On the day of your closing, you’ll be asked to provide payment for your closing costs. You can either wire the funds to the closing agency or submit payment with a cashier’s or certified check, made payable to the settlement agency conducting your closing.
2. You’ll also need to bring a government issued ID (such as a driver’s license, passport military ID) on your closing day.
3. Your closing agent will present your closing documents, page by page, and answer any questions you have. You’ll be asked to sign and/or initial certain pages within the closing documents.
4. Once your closing documents are signed, you’ll receive the keys to your new home!

*If you have a representative signing on your behalf via a Power of Attorney (POA), the original POA document will be required at closing.

At Linear Title & Escrow, we are proud to serve our clients with the most efficient, streamlined closing process possible. Contact our knowledgeable team now for questions regarding a home closing!

Refinancing a mortgage is an action many homeowners take, for a variety of reasons. Some choose to refinance to enjoy a better loan rate, while others wish to cash in some of the equity in their home. Still, others refinance to reduce the length of their mortgage, or change to a different mortgage product altogether. Whatever the reason may be, it’s important to know the types of closing costs that may accompany a mortgage refinance.

Closing Fees for a Refinance

The closing costs required for a mortgage refinance vary by lender, interest rates and loan amount, among other factors. However, the fees listed below are those most common to the refinancing process. Keep in mind, you may still need a third-party home appraisal to refinance your loan, depending on the type of mortgage.

• Lender fees
• Credit fees
• Points (optional)
• Home appraisal (if applicable)
• Taxes
• Insurance
• Tile and escrow fees

 Know Before You Sign

In any real estate transaction, it’s always prudent to ask questions, do your research and know what your financial responsibilities will be before you sign. Closing fees typically are rolled into your new mortgage. In some cases, lenders may offer to cover a portion of closing costs allowable by law on your behalf. Lenders are required to submit to you a Closing Disclosure (CD) Form three business days prior to your closing. The CD form contains final loan details and lists the closing costs you can expect to pay. It’s very important to carefully review the document, and ask any final questions you may have before you sign.

Have questions about the closing process for refinancing a mortgage? Contact our friendly team today!