How Do I Change Utilities?

There's so much going on when you're buying or selling a home -- even more if you're doing both at the same time -- that it's easy to forget the details. Changing over the utilities is a fairly important detail, though: can you imagine moving into your new home, only to realize that the power has been turned off?  The general rule of thumb in Cincinnati is that the seller should contact the utility companies at least one week before closing to allow time for final readings to be scheduled. The buyer should also contact the utility companies during this time to set up their accounts; if you haven't had a previous account in good standing with any of these companies, you may need to provide additional information which can take a few more days.

You can also ask some utility companies about the average bill for an address when you're deciding whether to make an offer on a property. Usage is different for everyone, but chances are a very high number means that there is room for improvement in the efficiency of the home. Finally, television and internet service can vary by street rather than municipality, so you'll need to Google those options!

What Is TRID, And Why Should I Care?

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Have you bought or sold a home in the last forty years? Aside from interest rates and loan products, not much has changed in the home-buying process during that time. But some important changes are on their way, thanks to the Consumer Financial Protection Bureau (CFPB). They're called the Truth in Lending Act (TILA) - Real Estate Settlement Procedures Act (RESPA) Integrated Disclosure, or TRID for short...because there weren't enough acronyms already.

To download a handy booklet that covers everything a consumer would need to know about TRID, head over to the CFPB website and look for the "Your Home Loan Toolkit" PDF brochure. I'll go over the highlights for you:

• Today, many real estate contracts request a closing date 30 days out. When TRID goes into effect on October 3rd, lenders and title companies are recommending that you allow an extra week or two on the contract to ensure compliance with new government mandated waiting periods that are designed to allow consumers adequate time to review loan information prior to closing.
• As a buyer, you'll probably be asked by your lender to sign documents electronically since that will be the most practical way to comply with the new laws.
• The preapproval process remains unchanged, for the most part. Although lenders are now prohibited from requiring income information to provide a Loan Estimate (LE), a smart buyer should know that the most solid loan preapproval will be based on that income information. So make sure you're being open with your loan officer!
• Sometimes under the current laws, the loan is processed well before the closing date, and you get to close early! That's going to be pretty unlikely under the new rules, because the closing date determines some of the information on the Closing Disclosure (CD) and the lender needs to provide the CD to the borrower no later than 3 days prior to closing (including Saturdays for some lenders, excluding Sundays and federal holidays for all lenders).

While there is a lot more to say about TRID, very little of it will be seen by the average consumer. My advice is to make sure you're ready to act quickly once you've chosen a home: provide all the details to your loan officer, get an estimate on homeowner's insurance, and make sure your Realtor is communicating with the lender and the title company on a regular basis.

Something Will Always Go Wrong

It may be an upside-down electrical outlet, last second title issues, or an incorrect item on your HUD-1 settlement statement, but at some point when you're buying or selling a home there will be a problem. When it happens, even if you're tempted to think that the sky is falling, take a deep breath and remember: if buying and selling a home was easy, no one would ever complain about it.

Preparing your response to the issue that may or may not resemble a wrecking ball to your plans takes some guidance, hopefully from your awesome Realtor. First, determine how important the issue is -- not in principle, but in fact. Is it important enough to walk away from the sale? To delay closing until it's rectified? To aggravate the other party further? If you are considering anything else, such as what your mother will say (if you tell her) or your pride, just stop. That's not helping anyone. You have signed a legal contract. If you're considering doing anything to change the terms of that contract or delay its execution, there can be expensive consequences.

Next, brainstorm possible solutions to the problem that would make you more comfortable with the situation, and consider how the other party might respond to each one. Focus on reasonable and quick solutions that won't 1) send a loan back to underwriting, or 2) alienate the other party to such an extent that they refuse to work with you. Did the seller not fix something that was agreed upon in the contract? Offer to send your own contractor, or have the repair funds held in escrow by the closing agent until the work is done.

Remember, nothing is final until all parties have signed the paperwork. If you have a serious issue in your real estate transaction, talk to your Realtor and a real estate attorney if necessary to understand all the options. There is nearly always a solution, and it's our job to help you find it.

The Waiting Game

At the beginning of a real estate transaction, both buyer and seller have a lot to do and plenty of paperwork to sign. After the contract, there's the inspection period and possibly even more paperwork! Next is the appraisal, scheduled through the lender, which takes a bit more time and the buyer and seller don't end up signing anything more unless it comes in too low. But once that's settled, most buyers and sellers feel that the excitement has suddenly dropped off...it could be weeks before closing. What should the buyer and seller be doing after the appraisal?

Essentially, during this period you're waiting for the title company to research the title on the property. They're also communicating with lenders from both sides of the transaction to prepare the necessary closing paperwork. The buyer's lender is also working to pass the file to underwriting, the magical department that gives final approval for your mortgage. Your Realtor is the conduit, communicating regularly with the lender, the title company, and you. However, just because you're waiting on all those people to do their jobs doesn't mean the buyer and seller are done.

Now is the time to really focus on your upcoming move. Pack those boxes, pick a mover, notify the utility companies, file your change of address with the USPS, and make all or your plans for pet care, child care, and time off work to make sure you are ready for moving day. If you already know that you plan to make repairs or renovations at your new home, you can start talking to contractors to determine who will be available and within your price range.  You can also inform your credit card companies and your employer that you will have a new address as of the occupancy date in your contract. Most importantly, you don't want to be that person who is still cleaning the house at 5:30am the day of closing, so find a cleaning company to give the house a thorough once-over if you're the seller (or if you're the buyer of a distressed property)!