RESIDENTIAL AND COMMERCIAL CLOSINGS

With the recent increase in mortgage interest rates nationwide, it is unclear how the housing market will be effected until months to come. What is clear, however, is that Miami’s residential and commercial real estate markets are booming compared to just a few years ago when the majority of sales were distressed.  A rebound in housing prices has partly driven an increase in mortgage debt per borrower, which is expected to jump by about $9,000.00 up to an average of $192,500.00 by the end of 2016. “This is a clear indicator that housing prices are recovering and consumers are gaining access to mortgage mortgage loans”. said Steve Chaouki, EVP and Head of Transunion’s Financial Services Business Unit.

While we are a long way away from returning to pre-recession levels in terms of open mortgages,  more than 1.5 million “boomerang buyers” are predicted to re-enter the mortgage market over the next three years.  “Boomerang Buyers” are those that were hit hardest by the recession and housing crisis, and were among the participants of the foreclosure and mortgage debacle.  Transunion estimates that 2.2 million buyers who had either loan modifications or short sales over the past 5 years, will re-enter the market and purchase property over the next five years.

Yet obtaining financing in this day and age has been very tedious and complicated, specially for buyers who have either a foreclosure or bankruptcy on their credit profile.  Closing either a residential or commercial loan can turn into a long and complicated matter if proper measures are not observed or followed. Worse yet, not being fully represented in a loan closing by your own real estate attorney can result in a failed venture. While there is no requirement to engage a business attorney to represent you in a loan closing or to act as the settlement agent for the transaction, by engaging a real estate lawyer you can ensure that you have a fiduciary working for your best interests.

The Value of Hiring a Real Estate Attorney for a Loan Closing

Residential Loans

The procedure for closing a residential loan varies, but the outcome is generally the same. All the financial details that come with the purchase of your property and the receiving of the title have to be settled before the loan is made. By retaining an experienced real estate attorney to represent you in the closing process, you can ensure that you are purchasing a property which is free and clear of title defects and satisfies your investment objective.

You should prepare for your closing by consulting with your real estate lawyer to help you review all your closing documents to be sure everything is in order. Some of the primary closing documents are as follows:

• The Mortgage Note
• The Mortgage
• The Settlement Statement, commonly referred to as the HUD

Throughout the closing process your real estate attorney will review all the documents and explain each closing document to you before you sign them. And, if you have any questions, your attorney will answer them.

Commercial Loans

By their very nature, commercial loans frequently require increased attention and more paperwork than residential loans. Here are some of the requirements that you may need.

• Operating Statements for the past 3 years reflecting income and expenses of operations, including cost and timing of scheduled capital improvements;
• Certified copies of all Leases;
• A Certified Rent Roll;
• Estoppel Certificates signed by each tenant;
• An ALTA lender’s title insurance policy with required endorsements;
• Copies of all documents of record which are to remain as encumbrances following closing, including all easements, restrictions, party-wall agreements and other similar items;
• A current Plat of Survey prepared in accordance with 2011 Minimum Standard Detail Requirements for ALTA/ACSM Land Title Surveys certified to the lender, Buyer and the title insurer, including items 1 through 4, 6(a), 7(a), 7(b)(1), 8 through 10(a), 11(a) and 14 from the Surveyor’s “Optional Survey Responsibilities and Specifications” referred to as “Table A”;
• A satisfactory Environmental Site Evaluation Report (Phase I Audit) and, if appropriate under the circumstances, a Phase 2 Audit, to demonstrate the property is not burdened with any recognized environmental defect; and
• Site Improvements Inspection Report.

At the Law Offices of Jacqueline Salcines, PA, we are ready to go to work for you.  We have extensive experience and knowledge in the area of real estate, both residential and commercial.  With dual degrees in law and accounting, Attorney Jacqueline A. Salcines, Esq. is ready to put her knowledge and experience to work for you.