Deceased Persons on Title: When Death Seems to Haunt You

You may think it is coincidence that it is October, the wind is chilled, and as you get ready to purchase a house, the current owner’s dead Uncle Albert from five generations ago holds up your closing. Yes, October is the haunting season, but it’s really not a coincidence. Dead ancestors regularly hold up closings.

Apparently, no one dealt with Uncle Albert’s death because the house you are buying has been gifted and kept in the family for the last 100 years. Of course, many people in Texas did not use wills and probate proceedings in Uncle Albert’s day, and the only information the family has is that he was hanged for running with Jesse James.

Cool that he ran with Jesse James, but limited information is no good. How can you ever get title to the property? How could you ever have a title company issue a Texas title insurance policy on it? In this instance, an attorney or title company is called in to determine who the heirs of Uncle Albert are. Yes, the family tree has to be compiled from five generations ago and brought forward to the present. More than likely, there will be more dead ancestors than just Uncle Albert whose estates the house has passed through, and this will slow your closing even more. The more deaths without wills, the more affidavits of heirship have to be prepared. This can be an extremely lengthy process, and you may find the title of your dream home haunted by more ghosts than just Uncle Albert, lingering until dealt with accordingly.

But don’t fear because the ghosts can be put to rest! We have an attorney on our staff and an experienced escrow officer to stop the haunting. If you have an Uncle Albert haunting you, just call us. We can help you get title to the property and have a Texas title insurance policy issued to protect you from any other “haunting.”

Hey Mortgage Lenders and Mortgage Brokers! Do You Know When You Are No Longer Bound To Your Good Faith Estimate?

Under the new RESPA regulations, the loan originator is bound, within the tolerances, to the settlement charges and terms listed on the GFE provided to the borrower unless a new GFE is provided prior to settlement. If a loan originator provides a revised GFE consistent with the new regulations, the loan originator must document the reason that a new GFE was provided. Loan originators must retain documentation of any reasons for providing a new GFE for no less than three years after settlement. See 24 C.F.R. § 3500.7(f) at http://bit.ly/QRYSY. But when can you provide a new GFE?

According to the new RESPA FAQs updated October 7, 2009 (pgs. 13–14) at http://bit.ly/msSSY, HUD lays out the following scenarios indicating when a loan originator is no longer bound by the GFE provided to the borrower:

i) A mortgage broker issues a GFE that a lender does not accept and the lender does not receive the application within three days of the date the broker received the application.
A: This does not constitute a changed circumstance.

ii) If a GFE is issued without a property address, the later identification of a property address.
A: If a loan originator issues a GFE without identifying a property address, the subsequent identification of the property address is not considered a changed circumstance.

iii) The borrower does not proceed to closing quickly upon final approval or does not act diligently in providing information to the lender.
A: The particular facts of each situation must be examined to determine if the facts constitute a changed circumstance.

iv) GSE, FHA or Mortgage Insurance program changes.
A: This could constitute a changed circumstance if the loan originator did not have notice of the GSE, FHA or other mortgage insurance program change prior to the issuance of the GFE.

v) The property address provided by the applicant, turns out to not be the correct, legal address.
A: This could constitute a changed circumstance.

vi) After the GFE is issued, parties are added to or removed from title or the property is moved into or out of trust.
A: These situations could be considered changed circumstances.

vii) During or as part of the transaction, it is determined that the property use may change, such as from owner-occupied to rental property.
A: This could constitute a changed circumstance. It should be noted that business purpose loans are not covered by RESPA. See 24 C.F.R. §3500.5.

viii) After the GFE is issued, it is determined that a party will be using a POA to sign, which may require additional work and additional fees.
A: This could be considered a changed circumstance.

ix) Credit policy is required to change after the GFE is issued due to regulatory changes such as fees charged by government agencies for recording fees or taxes change after the GFE is issued.
A: This could constitute a changed circumstance if the loan originator did not have notice of the regulatory change prior to the issuance of the GFE.

x) The loan does not close by the close date in the original Purchase Agreement or Construction Agreement provided to the lender.
A: The particular facts of each situation must be examined to determine if the facts constitute a changed circumstance.

xi) The vendor originally selected to perform a settlement service goes out of business or stops offering the service.
A: The particular facts of each situation must be examined to determine if the facts constitute a changed circumstance.

xii) AVMs are commonly used for the property type and loan amount requested, but the AVM request comes back with a ―no hit, necessitating the use of a more expensive valuation method.
A: This could constitute a changed circumstance.

xiii) After the GFE is issued, it is determined that an additional service such as an additional pest, structural or other inspection, upgraded appraisal, certification, survey or other requirement is required by the loan originator in connection with the transaction.
A: This could constitute a changed circumstance.

xiv) The borrower‘s credit score changes.
A: This could constitute a changed circumstance.

xv) A mortgage broker issues a GFE based on one lender‘s loan products and origination fees, but places the loan with a different lender.
A: No, this would not constitute a changed circumstance.

The Best Texas Escrow Services? Really?

If you Google the words “Texas escrow services,” many links of title company information will pop up for your viewing. Of course, every title company from large to smallest promises their company’s service is the best. In all reality, if you do your homework, you will find that several of these companies have been penalized or fined for various errors by the Department of Insurance, or the reviews from consumers are not up to par. With the internet being a plethora of information, how do you know who you can trust?

When scouting a title company with which to place your order, you may want to consider several items. For example: size of the title agency, number of escrow officers, how many departments, how long has your escrow officer been licensed, what is their knowledge level, how easy can you contact their attorneys or higher-ups for those tough files, etc. Depending on your company’s needs, these questions may be answered differently; however, they should definitely be considered.

At Griffin Law Firm, we go as far as to invite our customers into our office for a visit. If you do not know who you are working with personally, then you are working with a file number and possibly an email address. We believe in relationships. By building a rapport with our clients, we have found the process and transaction is smoother and expectations are met quickly. Our goal is not only to have the best “Texas Escrow Services” but to service our clients by meeting their individual needs.

If you are looking for a different experience, please stop by or give us a call at 817.520.6000. We look forward to hearing from you.

Legislative Changes to Texas Title Insurance: Title Insurance Companies Can Now Charge for Electronic Filing Fees

H.B. 3073 alleviates a statutory uncertainty, allowing title insurance companies to charge for the actual, or reasonably estimated, cost of electronic filing fees by changing Tex. Ins. Code § 2501.008.

There has been some debate within the title insurance community whether or not electronic filing fees could be passed down to the consumer as a separate charge from the title insurance premium. Because of the potential inability to pass the cost on to the consumer, many title companies have been reluctant to adopt electronic filing of real estate documents.

Electronic filing of real estate documents provides a benefit to all parties involved: the county clerks, the consumer and the title companies. The county clerks, should they have an electronic filing system, benefit from “more immediate filing, better notice, and reduced labor and recording costs.” See Bill Analysis at http://bit.ly/enj6R. The consumer benefits from “immediate filing.” Id. The title company benefits from “reduced losses due to gaps in filing.” Id. Clearly, an electronic system provides a more seamless system with less room for errors or problems than a system that relies upon certified or overnight mail and bureaucrats shuffling unending stacks of paper.

To read H.B. 3073, go to http://bit.ly/31Zg38.

Paying Attention to Real Estate Contract Deadlines

As an attorney, I have dealt with Texas real estate purchase-sale contracts on numerous occasions—and in particular the TREC-promulgated real estate contracts. In dealing with brokers, real estate agents, buyers and sellers, I have come to the conclusion there is a need on all levels for a greater awareness of the various deadlines and responsibilities placed on each party.

Filling in the many deadline blanks in the TREC contract serves a more important function that just completing the contract. Each deadline is there to allow the buyer ample time to complete the complex due diligence of the property or show the seller that they have a firm buyer. First off, an agent should take due care to make sure the deadlines can be fulfilled realistically. Secondly, because of the busy schedules of the real estate professionals involved in the purchase and sale of real estate, it is easy to miss these deadlines, which could subject an agent to litigation risk should the transaction go bad.

A real estate contract should be read not only for the price, terms and conditions, but also for the critical dates. For example:

• Declaration of Bylaws and Rules of the Association (for condos or PUDs) should be delivered to the buyer by the seller in 20 days of the execution of the contract otherwise; the buyer can cancel the contract. Once the buyer receives the bylaws and rules of the association, the buyer has 6 days to object.
• The same goes for the Resale Certificate which cannot be older than three months. If the buyer objects within the timeframe given, the buyer can cancel and receive refund of earnest money.
• Commitment for Title Insurance is to be delivered to the buyer no later than 20 days along with documents evidencing restrictive covenants or exceptions to policy. If the title commitment is not delivered within 20 days, the contract extends 15 days or until the time of closing, whichever is earlier. Once the commitment is delivered, the buyer has 10 days or until the date of closing, whichever is earlier to make any title objections. If any objections are made, the Seller has 15 days to respond. If the title objections are not cured within 15 days, the buyer can cancel the contract and the earnest money will be refunded.
• From the time an Option Fee is paid the buyer has 10 days to review the contract and if the buyer decides to cancel, the buyer’s earnest money will be refunded, but not the option fee.
• It is customary that Third Party Financing Addendum normally states the buyer must obtain financing within 20 days (although since loan underwriting can take longer, it might be advisable for the buyer to negotiate for more days). Thus, if the buyer can not secure financing in 20 days, then the buyer can cancel and have his earnest money refunded.

These are just a few of the timelines to be aware of. Of course, the parties can always alter the amount of days listed above if agreed to by all parties.

At Griffin Law Firm, because this is such an important aspect of accomplishing the close of a transaction, we assist our real estate clients in keeping up with these deadlines throughout the purchase-sale process.

Our Arlington Location Central To All DFW Real Estate Closings

Griffin Law Firm's office is located in Arlington, Texas between Dallas and Ft. Worth, placing us in a central area to conduct title insurance and escrow closing services for real estate transactions in the Dallas-Ft. Worth metroplex. Unlike many metropolitan areas, DFW is a cluster of many cities like Arlington, Irving, Hurst, Euless, Bedford, Plano, Saginaw, Frisco--and not just Dallas or Ft. Worth. Our location is even central to Weatherford, Crowley, Burleson, Joshua and Cleburne. Much of the DFW metroplex's housing and commercial growth has occurred in these smaller surrounding cities, making our office a prime location for handling title insurance and escrow closing transactions.