ANY open permits and or code violations need to be fully addressed and resolved by the potential home buyer, prior to closing.  Failing to do so can be very costly for a homeowner.

Open permits remain with the property, despite any change in ownership.  Failure to uncover any open permits prior to closing means that these permits become the responsibility of the new owner.  Requirements to remedy an open permit can include fines, fees, and completion of pending work and removal of work that does not meet building requirements.  Open permits can be quite costly and time consuming.

Q. What is an open or expired permit?

 An open or expired permit is a permit which has been issued by a County or Municipal building department but has not been formally finalized in accordance with established guidelines, typically by means of a final inspection, within the time provided.  Once the time has lapsed for the permit to be closed by the issuing department it is referred to as open or expired.

Q. Why do I need an open permit search?

One of the biggest obstacles for home sellers these days is the issue of open permits.  Since many Counties have declared war on open permits, homeowners are finding themselves at the mercy of county inspectors when the time comes to close on the sale of their home.  Attorneys and title companies may recommend that buyers not close if a permit search reveals open permits

Q. Will title insurance cover open or expired permits?

A good title company or real estate closing attorney will take care of this for you but you have to ask for it because it normally is not done.  Title companies can close the sale on a property with an open permit on it, and most will never even conduct an open permit search; it’s not the same as a lien search.  You should order an Open Permit Search at the same time you schedule your inspection.

This is a service that I provide for my Buyers. I usually go to the Building Code department of the town or municipality where the home is located and pull the record on all permitted activity on the home.  If there is work that has been done that has not been permitted that is an issue that should be addressed by the home inspector.

Q. Will my closing agent check for open or expired permits?

Oftentimes the person selling the home or their listing agent has no idea about his or her own permit situation. They may have had some work done and their contractor told them everything was good to go and somewhere down the road they will find out that the permit is still open and if you are the new owner this is now your problem to deal with.  Sometimes work was done before the current owner bought the home and they have no idea anything could still be open.

The best way to protect yourself is to do an open permit search.  If you are selling your home it is a good idea to make sure your home has all of its permit issues in order because nothing can kill a deal faster than when a buyer finds out there are open permits  If you are the buyer, take care of it before you face a potential issue in the future.

Q. Who is responsible to close an open permit?

Open permits can be grounds for the title company to balk or the lender to renege on financing.  Uncovering open permits and closing them typically falls on the shoulders of the SELLER but may not be written in a standard contract. Every State or County’s standard contracts vary.  Make sure you understand the terms and conditions involving permits in whatever contract you are using. It often can be grounds for terminating a contract.

Q. Is it really that important? What is the worst that can happen?

If open and/or expired permits exist and are not closed prior to closing, these permits become the responsibility of the new homeowner. The new owner will be responsible for paying all fees and/or fines and will be forced to complete the pending work.  If the permit is not properly closed, the building department may be able to order the removal of the work on the property.

Q:  Found an open permit.  Now what?

If there are any open permits on your home the Building and Zoning Department can provide you with the name and contact information for whomever pulled the permits.  You can then contact the contractor to get the permit closed.

Q:  What if the contractor is no longer in business?

If your contractor is no longer in business, you have a couple of options:

You can close the permits yourself. This involves contacting the Building and Zoning Department; arranging for any missing inspections; following up with inspectors and the department to make sure that the permit is closed on the computer.  Or, you can contact a local permit expeditor to close the open permits for you.

Filed under: Blog, Home Buyer Advice, Home Buyers, House Closings, Real Estate by Kim Bregman
Comments Off on Open Permits: A Homebuyer’s Nightmare

Buying a home is probably the most important purchase you will ever make…  these ten tips will help you better understand what you can expect from contract to closing.

 1. Determine Your Needs

The process of purchasing a home can be especially daunting if you don’t take the time to determine your needs. A real estate professional will be able to best assist you if you are willing to answer a few important questions:

• What is your current lifestyle and how will that play into the neighborhood or community you choose? e.g. sports enthusiast that requires hiking trails within the neighborhood
• Size of home including bedrooms, bathrooms, and specialty rooms such as media or pool room.
• Style of home: Ranch vs. Two-Story and Tudor vs. Cape Cod
• Schools, Religious institutions, commute to work all influence the area you choose to focus on

2. Consider the Cost of Homeownership

There are various financial commitments to consider, most importantly how a new home will fit into your budget.

You need to ensure that you can afford the monthly mortgage payment, as well as any expenses including utilities, taxes, insurance, maintenance, and/or possible homeowner’s association fees.

3. Interview an Exclusive Buyer Agent
A Buyer’s Agent will share valuable and essential information with you, if known, such as:

• • The seller’s reason for selling and timetable
  • Length of time the home has been on the market
  • Previous offers and counter offers for the property
  • Strengths and weaknesses of the property
  • Determining an offer price based on past comparable sales
  • Locating suitable property not currently on the market

You owe it to yourself to be the most knowledgeable buyer you can be. You can ask a buyer’s agent for advice and assistance in setting your offering price and structuring the other terms of your offer. What’s more, you’ll have peace of mind knowing an advocate is working on your behalf to help you buy at the best possible terms. 

Ask for references and listen to what other people have to say about their experiences with a particular agent. Ultimately, you want to find someone that knows your area, has a good grasp on current market conditions and that you feel comfortable with.

4. Decide if You Will Build or Buy Resale

Are you going to buy an existing home or build something new? There are pros and cons to both, with each a reflection of your lifestyle and needs.

This calls for thorough research to identify which of the above is beneficial to you as an aspiring homeowner.

 5. Location, Location, Location

Location is one of the key factors to consider in any home purchase. Make sure that you buy a home in areas where the value of property is set to increase as opposed to those with low prices and high chances of stagnation.

 6. Understand Mortgage Options

Speak with a mortgage professional about your options and make sure to share details about your current financial situation, including your monthly budget for a new home. They will be able to offer guidance on which loan program will work best for you.

  7. The Benefits of a Home Inspection

A home inspector will inspect the home prior to purchase to examine for structural and safety issues. An inspection is not required, but a wise choice as it will determine if the home is structurally sound and wiring and pluming are up to code.

They will also check for safety hazards, including loose railings, rotted or damaged porch or entryway steps and broken windows.

 8. Get Everything in Writing

The best way to protect yourself is to ensure that every part of your transaction is captured in writing. An example of this would be repairs the seller agrees to make prior to closing.

Your real estate professional is there to make certain those repairs are added to an addendum which becomes a part of the purchase agreement. You do not want to have a casual conversation with the seller that could be left to interpretation when it comes to the largest purchase you will probably ever make.

9. Finalize the Purchase

To avoid problems at the closing table, make sure you have a clear understanding of what to expect. Go through your loan details one last time so there are no surprises when it comes to interest rate, loan amount or mortgage term.

There will be a substantial amount of paperwork to sign so give yourself plenty of time to adequately review the details.

10. Home Improvements

Your home is a valuable asset. Once you close, continue to put aside money on a monthly basis for any necessary repairs or maintenance.

It’s also important to note that certain upgrades may contribute to lower insurance premiums. This makes it important for you to stay in touch with your real estate professional. They can provide guidance on value boosting renovations.

Filed under: Blog, Exclusive Buyer Agent, Home Buyers, Home Financing, Real Estate by Kim Bregman
Comments Off on 10 Tips Every Homebuyer Needs to Know

There is often a misconception of what a final walk through is and why it’s important.  A final walk through can sometimes be referred to as a pre-closing “inspection.”  Although you are probably excited and anxious to close on your new home, the final walk through is important and many things should checked and inspected and not overlooked.

The final walk through is NOT a home inspection.  In most cases, a buyer has had the opportunity to perform a thorough home inspection prior to finalizing the contract for purchase.  It is a common contract contingency that you should be aware of when purchasing a home. The final walk through is the time to ensure that the personal property items that were agreed to be included in the sale, are still present, that the condition of the home is substantively the same or better than the day you went under contract, check the functionality of the home’s features, and that any agreed to repairs have been made to your satisfaction.

Oftentimes, buyers negotiate sale terms to keep new appliances, light fixtures, window treatments and other installations as part of their purchases agreements. Bring your contract to purchase with you and begin your walk-through by confirming all agreed upon features are still present and in the same condition as the time of inspection.

When homes are transferred from a seller to a buyer, they are supposed to be in “broom-clean condition.”  The term “broom-clean” is a very vague, as it can mean one thing to the buyer and a different to the seller.  If there is garbage, boxes in the attic, old paint in the garage, or personal belongings from the seller in the storage areas or in the home, they should be removed by the seller at their expense prior to closing.  It is not the responsibility of the buyers to remove or dispose of the seller’s possessions that were not specifically identified as personality that was to stay with the property.

When a seller’s furniture is moved out, it’s much easier for buyers to recognize damages they may have overlooked during their initial inspections. Review surfaces, ceilings, walls and floors for any new damages such as scratched or soiled flooring and carpet, look for water damage, and cracked windows and walls.

Possibly the most important part of the final walk through is to complete a checklist of the home.  Your real estateagent should supply you with a thorough checklist and assist you with the walk-through.  The checklist should include, but not be limited to the following:

•   Check gas features, including fireplace inserts, stove and oven

•   Does the fireplace turn on with the switch

•   Do the burners warm when lit

•   Does the oven heat properly

•   Flip switches on the garbage disposal

•   Check all ceiling fans

•   Ensure the exhaust fans work properly

•   Check the AC and heat thermostats

•   Open the refrigerator; is it cool and cleaned out. Is the icemaker making ice?

•   Turn knobs on each faucet to test the handles work

•   Is the water warm indicating the water heater is functioning correctly

•   Is there proper drainage down each drain

•   Look below each sink for moisture or leaks

•   Flush each toilet and ensure they fill back up with water instead of running or leaking

•   Peer around bathrooms, kitchens, and laundry rooms for water damage

•   Check along flooring or base molding and spot any indicators of mildew or mold

•   Walk around the entire home testing each light switch

•   Are all switch covers present

•   Open and close every window

•   Make sure the windows and doors lock shut properly

•   If screens and storm windows are expected, account for each before moving to the next window.  If there are hurricane shutters that remain with the house make sure they are all in place.

•  Test to make sure the pool pump is running

•   Is the landscaping in good shape, has the grass been watered?

•   Check the garage door openers and try each control

•   Ring the doorbell

•   If an alarm system is included in the purchase agreement, test entry and disengagement

•   If the property has a sprinkler system, start it to make sure it’s functioning

•   Look at the exterior siding, roofing, chimney, or any other exterior features that the home may have.  If there has been severe weather recently this is extra important, as it’s not uncommon for roof shingles or siding to be damaged.

•   If there were items that were agreed upon between the buyer and seller to be repaired or fixed, make sure they have been completed.  A good buyers real estate agent should ask for receipts or records from any repairs that were agreed upon.

•   Look for owner’s manuals to accompany all appliances and remote controls for ceiling fans, lighting, sound systems or any other features.

Buyers agents can require sellers to meet the terms of the purchase agreement prior to closing or renegotiate new terms to cover costs of repairing any missing features or damages found during the final walk-through. This is often accomplished in conjunction with the buyer’s attorney.  If there are problems that arise from the final walk through, it’s important to address them quickly.  The final walk-through is the last chance for buyers to critically review properties before signing closing paperwork. Buyers who use the opportunity wisely tend to have the highest probability of buyer satisfaction

Filed under: Blog, Florida Real Estate, Home Buyers, Kim Around the Web, western north carolina real estate by Kim Bregman
Comments Off on The Importance of a Final Walk-Through

The obvious advantages to residing in Florida is the weather and no state income taxes.  Another lesser known, but equally as important, advantage is Florida’s homestead laws.

“Homestead” can be a deceptively complex issue in estate and tax planning when individauls finally decide to become Florida residents, including asset protection, property tax savings, and restrictions on the estate plan.

Florida’s asset protection for homesteads is anchored in the state’s constitution (Article X, Section 4). Homestead property owned by a natural person is protected from forced sale under process of any court or judgment lien (except for obligations relating to the real estate itself, such as property taxes, mortgage principal and interest, and contractors’ liens).

The asset protection for homestead includes land and improvements on the land, with an acreage limit of up to 160 contiguous acres outside a municipality, and one-half acre inside a municipality.

Florida also offers two sorts of property tax savings for homestead property: (1) the “$50,000 exemption“ and (2) the “Save Our Homes” limit on annual property tax increases.

The “$50,000 exemption” is a reduction of up to $50,000 in the assessed value of the homestead property. A homeowner can apply for this exemption by filing a Form DR-501 at the county appraiser’s office.

The $50,000 homestead exemption is helpful as far as it goes, but it doesn’t go very far.  The “Save our Homes” advantages for homestead property approved by Florida’s voters as a constitutional amendment in 1992 are much more economically significant. ” Save our Homes” limits annual increases in property assessments to the lesser of 3% or the annual increase in the Consumer Price Index.  Over time, especially when Florida’s real estate market is appreciating, annual “Save Our Homes” advantages can be substantial.

Filed under: Blog, Florida Real Estate, Home Buyers, Uncategorized by Kim Bregman
Comments Off on Florida Homestead Exemption Advantages