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Showing posts from December 29, 2011

NEW YEAR - NEW REQUIREMENT FOR (SOME) CHICAGO REAL ESTATE TRANSFERS

A recently amended municipal ordinance that becomes effective on January 1st is likely  to cause some headaches for unsuspecting  real estate practitioners and will definitely increase fees that some of our clients are going to have to pay to effect property transfers

The City of Chicago has long required that real estate sellers obtain a water department "full payment certificate (FPC)" before a sale transaction is completed.  The Chicago Department of Revenue will not seller property transfer tax stamps without the full payment certification, and the Cook County Recorder of Deeds will not accept a deed without the transfer tax stamps.

Certain classes of transactions are exempt from having to pay transfer taxes and have been historically also exempt from the requirement of obtaining / presenting a full payment certification. These include transfers to add a spouse (or other party) onto a title; transfer to change the form  of ownership of a property, and transfers that are …

FHA EXTENDS WAIVER OF ANTI-FLIPPING REGULATIONS THROUGH 2012

Goods news this week from Washington, DC for real estate investors, and the real estate agents that represent them -

The temporary waiver of FHA’s "anti-flipping" regulations has been extended through 2012.

"Flipping" is the industry term of art for a real estate purchase that is quickly followed by a resale - presumably for a higher price and resulting (but not excessive) profit.

With certain limited exceptions, FHA rules prohibit insuring a mortgage on a home owned by the seller for less than 90 days. In other words, Buyers willing to purchase a property that want to rely on an FHA guaranteed loan would only be able to do so if the seller has owned the property long enough.

The FHA temporarily waived this regulation in 2010 through January 31, 2011, then extended the waiver through year's end.

The extension allows buyers to purchase HUD-owned properties, bank-owned properties, or properties resold through private sales.

The idea here is to allow homes to r…

NEW TITLE COMPANY POLICY MAY ACTUALLY HELP BUYERS / LENDERS ESTIMATE CLOSING COSTS ACCURATELY

Title Insurance Companies owned by Fidelity National (including Chicago Title Insurance) have a announced a new policy that will, among other things, help Buyers, Mortgage Lenders, and Attorneys estimate closing costs more accurately.

Effective January 1st, 2012, the Fidelity companies will charge Buyers a flat rate to record closing documents with local county recorders of deeds.

County Recorders of Deeds keep the "official" public registry of all land title transfers and liens placed against real estate, such as mortgages, foreclosure proceedings, and the like. The Recorders charge fees based on the number of pages in any given document,

This causes problems for residential mortgage lenders who are obligated by federal regulations to give their borrowers accurate "good faith estimates" of their closing costs, but may not know exactly how many pages of mortgage paperwork a borrower will need to sign at closing,. This  happens because the loan originator may not kn…