3 Ways to Help Prevent Title Issues in Real Estate Investing

A marketable title in a real estate transaction means that the buyer is getting a deed to the property that is insurable by a title insurance company and he is not assuming any liabilities from the former owner. All deficiencies in the chain of title (defects) or attachments have been cured in the past or do not exist at the time of closing.

It is very simple to get what is called an insurable title. For the casual observer at the closing, this title may appear to be the same as a marketable title. The difference can be enormous and very expensive later for the buyer. Title defects and deficiencies can be passed to the new owner if the closing agent makes these exceptions or exclusions to the title policy. The title will be insured at closing except for these title problems.

This process of passing a title issue to a buyer is luckily not all that common except in REO (bank-owned) properties. With REOs the acquisition of the property by a foreclosure action can cause defects in the title for a number of reasons, including improper service to the legal owners of the property.

Many banks don't maintain their properties until required to do so by the local municipality that does code enforcement. This can result in on-going code violations that can quickly result in hundreds of thousands of dollars which the banks are seldom willing to pay. In most cases the banks will try and pass these liens on to the unwary buyer/investor.

While there are other preventative methods to protect you when buying any property, here are three that are simple and work very well:

1.      1.  Always put the following or similar clause in your purchase contract, "Seller to provide clear, marketable and insurable title at closing." Some banks selling REOs will not agree to this and you will likely have a major problem selling to an end-buyer who wants to purchase with conventional financing.

2.      2.  Ask to see the title commitment from the closing agent before you go to the actual closing. This is the identical document that will become your title policy after your new deed has been recorded. Look carefully at the exclusions and exceptions listed in Schedule A or B, whichever is applicable to that title insurer. Ask the closing agent to delete the B-1 exceptions at the closing and your title commitment will become your title policy. If you find lines or title issues as exceptions in your commitment, get them cured before you close.

3.       3. Ask the closing agent to review the lien letters he got back from the municipalities that enforce code violations for your property. If the liens letters are not back don't close as the letters stipulate that no code violations exist that have not yet become liens in the public record. These violations, but not yet liens, are exempt from the title policy in most cases, but you will be responsible for them as the new owner.

In summary, taking a few minutes to review the above documents and using the specific clause in your contracts will go a long way toward making sure you get a title that you can transfer to another buyer without concern. I am seeing deficient title work and defects in over 40% of REO closings that we do and it is such a problem that we do what I call shadowing the closings using our attorneys to review the title work of the REO closing agents. As an example, the most common mistake is not paying an existing water bill at closing as the bill is not yet a lien so it doesn't appear in a lien search. Just one of these bills was over $2,400 alone so be careful and review you closing documents or have your own attorney do it for you.

Source: Ezine Article, Main Street Abstract

Good Builder's Tips to Modernize Your Home

The current craze for property shows on the television means that we more exposed than ever to the current trends and fashions in home design and decorating. If you find yourself looking enviously at those fabulously modern properties on the tally then you might like to consider these changes to your own home. Some are simple and easy to carry out, while others are rather more expensive and may require you to seek professional help.

Your kitchen is one the key rooms in the house when it comes to giving it a contemporary look. It is also one of the most neglected rooms in a lot of properties. A kitchen facelift needn't cost the earth, as a few simple changes will achieve the effect without you buying hugely expensive chrome units. If you kitchen is cluttered and a little ragged then a simple clean out and scrub up can let you see it in a different light. Once that is done you can check whether the units and appliances need to be changed or not. A common mistake in kitchens is to overlook the flooring. A simple change to quality wooden or stone flooring can make all the difference in some cases.

The bathroom is another room which can age very badly, especially if you have colored units or have added items bit by bit without considering the room as a whole. Simple basic white units can be bought very cheaply. If you combine them with some nice looking taps and a quality shower then you have a very presentable, modern bathroom. A budget which stretches to tiling the whole room gives you a wonderfully clean and contemporary wet room.

Another area which is often overlooked by house owners is the garden. A simple gravel path or classy paving gives you a pleasant entrance to the property, while an unfussy, low maintenance front garden gives the right impression and never gets out of control.

A final modernization tip which I would strongly recommend is to switch from those chunky old radiators and heaters to under floor heating. This is quite an expensive change and you will need a good builder to do it for you. Check out online auction sites for recommended builders, for this and any other change you plan to make. Apart from choosing the right material and look, one of the most crucial features of a modern home is the standard of finish. A well chosen local builder will do any of the jobs I mentioned quickly and with a minimum of fuss. The tradesmen sites will let you see reviews by past customers, to help you choose the most highly rated builder.

Building a New Home - 5 Tips for Finding Local Home Builders

As a builder I am always interested to hear how people came across my name when searching through the many local builders available in their area. So I always ask the question, "How did you hear about me?" The answers I have come across are quite creative and would benefit anyone who is wanting to build a new home and seeking to find home builders in their area.

Ask your local banker I frequently hear this response and it makes sense if you think about it. Your local banker underwrites a lot of home loans for home buyers and builders in your area. Bankers are the ones who know if the home builder stayed within budget or went $30,000 over budget. He/she knows which builders are in financial trouble and which builders are not. Most local banks require custom builders to become "qualified" or keep an "approved" local builders list on file. Asking your banker for references is a great place to begin because he/she will not suggest builders that are not top-quality. Banks want happy customers, and that translates into a custom builder who can deliver within budget and on schedule.

Open Houses/Realtor Attend open houses of previously built custom homes in your area. This will allow you to see the level of quality that a certain custom builder provides. You can see first-hand how the materials and craftsmanship of the home is aging after 3-5 years. If you like (or dislike) the house, ask the realtor, "Who is the builder of this home?" The realtor will most likely know the answer or can find out for you from the owners.

Friends Bad contractor stories spread faster than a forest fire. You would surely warn all your friends if a builder went thousands of dollars over budget and you had to acquire a second mortgage. Ask friends and coworkers if they know any local residential contractors.

Associations' Websites Every county or city has a home building association. These home building organizations can provide a list of local builders that are members of their organization. These are good home building resources because a credible home builder will be a member of these types of home building organizations.

    * NAHB is the National Association of Home Builders http://nahb.org

    * Your State HBA

    * Your City or County's HBA

    * Your State Home Builder Licensure Board/Agency

Architect or Draftsman When working with a local architect or draftsman who renders your home plans, ask them for a list of local residential contractors in the area. If they are willing to provide referrals, ask if they would recommend two or three builders that they think would work well with your personality, home size and budget. Your draftsman has become acquainted with your style throughout the plans stage and they could recommend local building professionals for the bidding process.

New-homes sales up 27% in March

Tax credit deadline on April 30 raised the sales of homes in March 2010. According to U.S. Census Bureau, the purchase of new-homes in March increased the annual rate of sale of home to 411,000 and it is fastest sales since April 1963. Annualized rate surged 27% from February and not only pending home sales but the sales of new-homes rose. Tax credit deadline is behind the surge in sales of existing and pending homes.

The sale rose from March 2009 by 24% and economists are not sure if the sale will sustain in coming months as the tax credit expires. Many buyers couldn't spend on homes in February due to storms and in March the improvement in climate helped the buyers to take a final decision.

The chief economist at National Association of Home Builders said "I believe the growth may get flat after the expiration of tax credit" but he also expressed hope that the previous conditions of decline in home sales is over. There are many market experts who believe the market will sustain improvement beyond low mortgages and tax credit deadlines.

In the South, March sales was up 43.5% and in the Northeast the sales rose 35.7% .In the West, sales rose 5.7% and in the Midwest, sales was up 4.3%.

The inventory of new homes lowered from 233,000 in February to 228,000 in March. The median sale price of new home was low from $221,600 in February to $214,000 in the subsequent month and the price was up 4% from the same month in the previous year. New homes sale was at its peak in mid-2005, when the rate was 1.39 million.

It is surprising that many new buyers are not buying foreclosure homes, although, the foreclosure homes can be bought at a bargain price. Home buyers feel foreclosure homes are mostly in bad shape and to make the home habitable, a lot of money has to be invested in refurbishment. Many buyers have a pre-defined budget to spend in home buying and refurbishment costs make the spending go beyond limits. There are a few real estate firms that provide low cost foreclosure homes with refurbishment and maintenance features.

Mayfair Group gives an opportunity to overseas buyers to invest in cheap foreclosure properties in Detroit. The entry level 3-bed detached home is priced at $41,495.It is a free-hand property and the properties are priced at fifty percent below market value. Mayfair provides complete management of the properties, which includes the rehabilitation of a tenant in the house .The properties are approved by HUD and the refurbishment cost is included in the price of the property. Mayfair's local partners in Detroit also provides convenient "Exit" options and the properties can be sold at market price anytime after buying.

Drop in jobless applications in week ending April 17

The Standard & Poor's Super composite Homebuilder Index was up 4.5 % in the month and the labor department informed the jobless applications dropped by 24,000 in the week ending April 17.

Gasoline rise

Increase in home sales and improvement in job market raised the demand for fuel. National Association of Realtors reported an increase in sale of previously owned homes in the month of March and Dollar was up 1% against Euro, highest since May7.

Gasoline price rose in the week indicating an increase in demand for fuel. It is expected the rate is not the highest in April, in fact, it will continue to grow in coming months. The May delivery price rose 0.8% to $2.3002 a gallon at the New York Mercantile Exchange.

Interest rate of bonds rise:

Interest rates in bond market rose after the release of positive reports on job and housing but the investors believe the increase in rates may hurt returns.

Research: Interview with Real Estate Investor, Article Base and Few other website.

Understand the Property Development Process

If you're like most people you've sat watching the various property shows on TV and thought: "I can do that".

With a new series of Grand Designs launching on Channel 4 recently; Relocation continuing with Kirstie Allsopp and Phil Spencer, and the usual BBC daytime shows, there's certainly plenty of inspiration around.

But have you ever thought through the process of property development and what it actually entails?

It's not an easy process. Often these TV shows take months, sometimes years of work, and edit them down to a single hour's entertainment (45 minutes if you count the ad breaks).

And there always seems to be a happy ending where the house is finished and the couples who have just moved into property development seem to make a profit.

Can it really be that easy? Well the first step to a successful property development is to understand the process. We've broken it down into a series of simple steps, so you can assess how easy you think you'll find buying a house and doing it up, whether it's to live in, or as an investment property.

The first thing to do is to work out how feasible the project is. This is typically a research phase, and requires you to see if there are suitable properties available in the area you want to invest in, and what the opportunities are.

For example, in your target area are there plenty of properties that haven't been updated for a few decades? Or is it full of estates built in the last few years? Successful property development is about taking a house and adding value to it to boost the price. If the house doesn't need anything doing, there's little opportunity for you.

Ask local estate agents what they have on their books. Tell them you are looking for a property development project. And don't forget to look into sales from local property auctioneers.

Once you have found a series of suitable properties make a shortlist and compare the options open to you. Take time to tour properties properly; find out as many details as you can. The more information you have about your potential properties, the easier you will find it to make a decision.

When you have picked a house, the next step is to get a full survey done on it and then buy it. Often people starting a new project such as this have to find funding from somewhere, such as a new loan or extended mortgage. As with all property purchases ensure you have this in place before you start looking (or you will just frustrate yourself and sellers).

And then when you've got your hands on the keys, it's time to start planning and designing the house. What you do will depend on your end goal. If you are looking to build your dream family home, then you will spend a lot of time getting every small detail correct. Whereas if you are doing this property development as an investment, you should spend your time focusing on creating a house that will have huge appeal to potential buyers. Don't sweat every small detail; do spend time ensuring quality is high.

When the planning it done it's time to get building. Your choices here are to do it yourself or GSI - Get Someone In. Often property developers start out intending to do the bulk of the work themselves, but soon find it can be more cost effective to hire experts as needed. If it takes you three days to plaster a wall that an expert can do in a morning, would that get your property development project finished more quickly?

Because you won't be able to sell it until it's finished. If done properly your house should have huge appeal to your target market. A recently renovated property with no chain should attract buyers quickly. To ensure you get it right, it can be a good idea to get your estate agent involved in the planning stage. They know what kind of buyers are in the market and can advise accordingly.

Finally, when the builders have gone and the cash is in the bank, do a review of the project and work out what you would do differently next time. This is an essential step that shouldn't be skipped. If you are going to have a career buying houses and doing them up, you will need to learn from every hard lesson.

Source: Article Base, Black Rock Estate, Shore Development

Do You Need A Real Estate Agent?

Real Estate business has seen tremendous growth and so has been the need of Real Estate agent. Today more and more people are getting interested to become home owner and as the demand for real estate need increases the role of Real Estate Agent becomes more important. In the past one agent use to provide services to both seller and buyer but as the real estate market changed people started to realize that specialized service is more logical and beneficial. In Real Estate industry now buyer/seller are looking for specialized agents who can provide specialized related expertise, information and services required to complete the process. When a real estate agent represents both buyer and seller it really restricts agents to provide impartial service to either party.

Let's look at the both (Seller/Buyer) scenario separately. A real estate agents who is a listing agent of seller has a fiduciary, ethically and moral duty to represent seller only.

By getting Exclusive Right to Sell Listing, the real estate agent is promising seller that he will live no stone unturned to market the home and find the best buyer at maximum possible market value for the home.

As a Buyer's real estate agent he need to find the right home for buyer along with should all information of the community. When a buyer is exploring to buy a real estate property in new community, he is very much interested to find out several information related to that particular community such as population, crime, climate, schools, traffic, living standards etc. Buyer's real estate agent should be well informed with all these information so that he can provide that information to buyer. It will be easier for buyer to make the decision based on these information. Once the buyer is ready to buy real estate property in the community then other part of the real estate agent's duty starts. As buyer's agent it is his responsibility to find a real estate property, as per buyer’s requirement. It is also buyer's real estate agents duty to negotiate the best market price with seller.

So if seller and buyer are represented by their own specialized agent then both agents can play a partial and specialized role for their client…

So it is quite clear that one real estate agent representing both seller and buyer cannot justify providing specialized service to both party. Both buyer and seller are in different need of services. That's why specialized real estate service has become more in demand where buyer/seller can get impartiality specialized service during the process.

Never before has the role of specialists in the world of real estate been more important. With buyers and sellers requiring more services, the industry has seen an explosion of agents who specialize in either the representation of sellers or buyers. These specialist agents can provide a wealth of services and maintain a complete impartiality during the sales process as there is only one client to concern them.

Historically the sales transaction and the concerns of the buyer were the purview of a single realtor. However, as the industry has progressed so have the needs of each party and so the specialist arose. Buyers have some very particular needs, and specifically the need to feel that their best interests are seen to. Listing agents are representatives of the home's owner and in that role they have a primary responsibility to that owner. How could they properly look after the needs of an interested buyer as well?

So what is it that a buyer's agent does? Primarily the buyer's agent will begin with the location of suitable properties for their clients. This is usually based upon a list of requirements and desires that the client has communicated to the agent. They will then arrange viewings and recap their findings with their clients and assist in deciding upon a good candidate for an offer. This will be based on the wealth of community information that a buyer's agent commands. As specialists, they are experts on their given area which is critical in the education of clients on the areas that they are considering. Once a property is decided upon, the buyer's agent changes significantly, evolving into an overseer-negotiator role. They will typically coordinate the inspections and conduct the negotiations with the listing agent. This includes the execution of the buyer’s subjects and the closing of the actual contract.

There is an art to representing a buyer. It is a role that has become ever more crucial in an industry where customer service is the single most important thing that an agent can offer. If you are in the market for a home then the buyer's agent is the friend that you need to make sure that you are given the service that you deserve.

Source: Article Base, Black Rock Estate and Corona Real Estate

Affordable Home for sale in NJ (New Jersey)

The Nottingham model, the Beech Wood model, the Green Leaf model, the Wakefield model – charming names for truly charming homes. Homes for sale in NJ that take you back to the sylvan calm, almost like Shakespeare’s Arden! Residential building contractor, NJ, Sherwood Forest homes gives you Millville homes that allow you to breathe the pure country air and your children to run and jump and develop naturally, while keeping an eye on your car gasoline. You are not far away from NJ. A short drive will take you to your place of work; shopping arcades, films and amusement parks – and you have this wonderful haven to return to.

Home buying NJ has never been better. The Builders League of New jersey has sought to allay consumer fears about the stability the real estate market in New Jersey. With the government providing sops to low income groups to enable people to buy rather than rent homes, homes in New Jersey are the flavor of the month. The Fed cuts- low mortgage rate of less than 6 %. First time home buyers buying in 2009 get the benefit of several tax adjustments that our team will apprise you of.

Residential builders NJ Sherwood Forest Homes has established communities all around Millville. Besides being conveniently located from the expressway, the idea of community ensures a certain class of neighborhood. You need not worry about your children hanging around with the wrong types. We have a large number of properties for sale NJ. You will be spoilt for choice – home buying in NJ. And while our Millville homes sale includes our charming models mentioned above, we also offer our services as custom home builders NJ. Your needs and creativity are effectively studied for feasibility by our architects, after which you get your dream home.

Sherwood forest III, the crowning glory of Residential builders NJ Sherwood Forest Homes, has won South Jersey’s hometown of the year awards. One of the reasons is because we have consciously reduced our carbon footprint and brought you eco-friendly comfort. In bringing you green surroundings we have taken care to use value engineered material like lumber waste and recyclable vinyl. Vinyl minimizes the need for VOC chemical paint and R-19 insulation reduces electricity consumption. PEX plumbing and energy star compliant features further reduce emissions and energy costs. Moreover, we employ local contractors, reducing transportation and so on. Storm water protection and reforestation is part of our plan.

Research Include: Article Base, Sherwood Forest Homes and Shore Development LLC

Celebrity Homes For Sale

Celebrity homes are among the most glamorous and most expensive in today's real estate market and throughout the recession, celebs have had their share of trouble selling high-priced properties.

However, a celebrity listing can carry with it the intangible feature of being the former home of a pop culture personality, adding more allure than a larger pool or additional bedrooms may for a similar high-end home.

Real estate website Zillow compiled for CNBC.com a list of 12 celebrity homes that currently listed for sale, and as it turns out, each property is as unique as the celebrity who is selling.

Michael Jackson

Listing price: $28,995,000
Interior: 17,171 sqft
Bedrooms: 7
Bathrooms: 13

Although the listing price has dropped more than $9 million from 2008, it is also infamously the home where Michael Jackson passed away last year, which could potentially either lure or scare away buyers. Although Jackson did not own the home, he was renting it for a reported $100,000 per month while he rehearshed his "This is It" tour.

This French Chateau is located in the Holmby Hills area of Los Angeles and includes a "glamorous" theater room, wine cellar, elevator, gym, guest house, a pool and expansive gardens on the 1.26 acre property. The home also features 12 fireplaces and an indoor spa.

In order to even view the home, interested buyers must go through an extensive "pre-buying" check, to avoid any paparazzi.

Ricky Martin

Listing price: $18,900,000
Interior: 9,882 sqft
Bedrooms: 5
Bathrooms: 7

Singer Ricky Martin's home is listed for just under $19 million in Golden Beach, Florida. The two-story Mediterranean-style estate features a 108-foot stretch of private beach and 29,088 sqft of total land.

Dr. Phil McGraw

Listing price: $16,500,000
Interior: 11,036 sqft
Bedrooms: 8
Bathrooms: 7

Dr. Phil's Hollywood home is currently on the market for a cool $16.5 million. With a prime "north of Sunset" location, this Mediterranean villa is completely walled and gated and features a grand 2-story entry, theater room, gym, billiard room, a 2-bedroom guest house and an outdoor dining room. The estate sits on land measuring approximately 31,360 square feet.

Uma Thurman

Listing price: $14,200,000
Interior: N/A
Bedrooms: 7
Bathrooms: 6.5

For $14.2 million, you could be the owner of the home formerly owned by actress Uma Thurman. Located in Manhattan's Greenwich Village, this 5-story apartment features a full-floor master suite, grand parlor, a stylized garden, outdoor cooking area, roof deck and a separate guest apartment. Zillow's estimated monthly mortgage payment on this home comes to $76,623.

Mel Gibson

Listing price: $12,750,000
Interior: 5,403 sq ft
Bedrooms: 6
Bathrooms: 5.5

On nearly 2.6 acres in Malibu, California, one of Mel Gibson's several highly-priced homes is on the market. After being listed earlier this year at $14.5 million, the home is currently for sale at $12.75 million.

The home features "park-like" grounds, fruit orchards, a lighted tennis court, 3 guest houses, a detached gym, library and a garden cabana.

Carmelo Anthony

Listing price: $9,500,000
Interior: 21,083 sqft
Bedrooms: 8
Bathrooms: 15

Denver Nuggets superstar Carmello Anthony has a high valued piece of real estate on the market. The 21,083 sq ft house is located in Littleton, Colorado in the gated community of Polo Ridge Estates and features a 7 car garage, guest house, home theater, a three-stall barn with a pasture and a 54-foot pool.

Anthony has the chance to opt-out of his contract in 2011 and is expected to test out free agency. When his home was put on the market, it signaled to many in the sports world that he would likely be on the move to a NBA different team.

Nick Lachey

Listing price: $6,800,000
Interior: 4,722 sqft
Bedrooms: 4
Bathrooms: 4.5

The singer and TV personality purchased this house, which was formerly owned by fashion model Heidi Klum, for $5 million shortly after his highly publicized break up with Jessica Simpson. Since then, he's redecorated the home to be the "ultimate bachelor pad." It sits atop a ridge overlooking Los Angeles and the Pacific Ocean.

Ed McMahon

Listing price: $4,600,000
Interior: 7,013 sqft
Bedrooms: 6
Bathrooms: 5.5

Another home in the market is that of the late Ed McMahon, who during the final years of his life struggled with the prospect of foreclosure on this property.

The Mediterranean-style estate is located in a prestigious area of Beverly Hills known as "The Summit" and features imported doors and "meticulously chosen" fireplaces. Sitting on approximately 1/3 of an acre, the home measures approximately 7,013 square feet.

Jerry Garcia

Listing price: $3,995,000
Interior: 7,189 sqft
Bedrooms: 5
Bathrooms: 6

For ultimate "Deadheads" in the market for a high end home - look no further than this property 35 miles north of San Francisco. Once home to the Greatful Dead's Jerry Garcia, it was the home he owned at the time of his death in 1995.

The home sits on 11 acres with views overlooking Mount Tamalpas, the Pacific Ocean and the skyline of Berkeley, California. The home features a long driveway bordered by palm trees, a theater with an 8'x10' screen, a master bedroom with a private deck and sauna and a 73,000 gallon swimming pool.

For a Grateful Dead enthusiast with nearly $4 million to spare, this home remains on the market.

Pierce Brosnan

Listing price: $3,900,000
Interior: 3,412 sqft
Bedrooms: 3
Bathrooms: 3.5

Another celebrity looking to unload property is actor Pierce Brosnan. The Malibu home, which is in close proximity to the beach, provides both ocean and mountain views.

The property also features tropical landscaping, while the home has several wide balconies and makes use of a flowing, open floorplan. According to Zillow, Brosnan purchased the home in 1996 for $600,000.

Mary Schmidt Amons

Listing price: $2,350,000
Interior: 15,000 sqft
Bedrooms: 6
Bathrooms: 5.5

Although other members of the "Real Housewives" have faced trouble with foreclosure, eviction and jail time, the Washington DC housewife, Mary Schmidt Amons, is listing her Virginia home without the backdrop of financial or legal hardship.

The home is located in the highly desirable Langley Farms neighborhood of McLean, Virginia, and includes a gourmet kitchen, a master suite with a private deck, sun room, library and 4-car garage. This 15,000 sqft home currently is on the market for $2.35 million.

John Wayne

Listing price: $2,263,000
Interior: 4,448 sqft
Bedrooms: 4
Bathrooms: 4.5

That's right, if you want to live like The Duke, you can do so in his former home, located in Newport Beach, California. The property has been listed for about 1 month and has had two previous owners since John Wayne. It last changed hands in 1998 for $895,000.

The house borders the Big Canyon Golf Course, right by the tee for the fourth hole. The home features a two-story living room with floor-to-ceiling windows, parquet floors, marble fireplaces, balconies and a formal dining room with a custom console designed by Wayne himself.

This "Versailles style" home is currently on the market for $2,263,000.

Source: Real Estate Yahoo