| Service
Providers When Buying a Home
You
and the Seller Must Agree
Buying
a home does not occur in a vacuum, involving
only you and the seller. There are all
kinds of people and services involved
behind the scenes to make it happen.
Since some of these services affect
both you and the seller, there will
have to be be agreement on which companies
you will use for them. When you
make your offer, you should request
your favorites for these services.
If you are unfamiliar with these service
providers, you can get recommendations
from your agent.
Escrow
and Settlement
For
example, you are going to need an escrow
or settlement company to act as an "independent
third party" between you and the
seller. Without having a third party
involved, how do you know that when
you fork over the money, you are going
to get the deed? This is the type of
service provided by escrow and settlement.
They will hold your deposit and coordinate
much of the activity that goes on during
the escrow period.
Since
this third party is very important to
both you and the seller and both of
you will pay fees to this company, it
is important to agree on which service
to use. Therefore, your choice should
be part of the offer. Since you do not
buy a home every other week or so, you
are probably unfamiliar with companies
that provide this service. Your agent
will make a recommendation. You have
the authority to accept this recommendation
and include it in your offer, or make
your own choice.
Keep
in mind that the seller will also have
a preference and this may be a point
of negotiation in a counter-offer. It
has become customary that one side will
choose the escrow/settlement agent and
one side chooses the title insurance
company. Even so, everything in real
estate is negotiable.
Title
Insurance Company
Title
insurance is important because, by providing
you with an Owners Policy, they insure
that you have clear title to the property.
If there are any problems later, you
can always go back to the title insurance
company and have them clear it up. Since
it is customary for the seller to pay
for the owner's policy, they have an
interest in which company is used.
However,
you are going to pay a fee to the title
insurance company, too. This is for
the Lender's Policy. The lender's policy
insures your mortgage lender that there
are no liens or judgments against the
property and that the mortgage will
be in first position. In other words,
should you sell the property or refinance
it, their mortgage gets paid first,
before any other claims against the
property.
The
lender's policy is less expensive than
the owner's policy.
Termite
and Pest Inspection
As
part of your offer, you may require
a termite and pest inspection. This
company not only inspects for termite
damage and pest infestations, but also
inspects for dry rot and water damage,
among other things. The company that
performs the inspection is important
to you as a buyer, because you want
to be sure they do a good job. It is
important to the seller because it is
customary that they pay for the inspection
and some types of repairs that may be
required.
You
should determine which company you want
to perform this inspection and make
it a part of your offer. Otherwise the
seller will choose. If you do not know
which company to hire, your agent will
make a recommendation.
copyright
2006 by Terry Light and RealEstate ABC
|
Home