- By the Texas Association of Realtors: “If a seller wants to avoid a possible violation of RESPA, the seller should not insist on a particular title company for the transaction unless the seller is paying for both the owner policy and the lender policy of title insurance.” There are 2 types of policies issued by title. One is the owner policy and the other is the lender policy. Most agents don’t understand this and think their seller can automatically select the title company because an owner policy is issued. This is not true. Typically, sellers offer to pay for owner policy title when they sell their home, and sometimes builders own their own title companies so they create a condition to make the buyer use their title company. The title company selected should be one that is unbiased, not privy to either party of the deal. Rule of Thumb.
- What happens when an appraisal comes in lower than the sales price of the contract? First, when you list a home, make sure you know the comps and are using the right ones before you price it. If it is priced correctly, you should not have a problem when you receive an offer – in this market, the offer should not be full price. If it is, you are paying too much if the property has not been reduced. The offer should be supportive of the comps. Remember, if both agents interpret comps the same, then there should be an easy agreement with price. If not, then you could run into a problem of buying a home where the appraisal does not support the price. This should not happen in today’s market, otherwise you go back to negotiation and most likely the appraised value will be the sales price.
- Builders: The face of a builder’s product is the Agent they hire. New construction is not just another pretty face on the block, nor is your Agent. Intelligence and skillfulness are what buyers look for when purchasing from a builder. Unfortunately, some builders are bruised, on account of hiring listing agents that demonstrate poor judgment and do not perform their responsibilities. This is visible to clients and Agents. I have encountered unwelcome situations and am skeptical about bringing clients to a builder where professionalism is/may be compromised by the Agent. Builders should vie for broad business experience in this versatile market. Remember, the client comes first, not your listing Agents.