No RESPA for the Weary....
In my continuing efforts to serve you 25/8, I have uncovered serious new issues with something that no one with a pulse wants to actually care about but must be aware of in Today's new world of real estate. Well, there are attorneys who may care and for that reason it should (grudgingly) matter to us.
RESPA. The Real Estate Settlement and Procedures Act. AKA....the really boring alternative to watching paint dry.
Simply put RESPA is the general set of guidelines that covers how real estate closings are to handled. RESPA has usually been this mostly inert set of rules that were the 3000 pound elephant in the room. Everybody do what they're supposed to and nobody gets hurt. Poke that behemoth and somebody could be recovering from a severe blow to the pocketbook.
The latest, not so subtle changes in how real estate closings are going to be handled stem directly from new legal interpretations of RESPA. For consumers it will mean more choices. Choices that could cost you money. Specifically my brothers and sisters here's what it is and what it shall be:
In the pre economic melt down world it was generally the home Seller's job (or Seller's Realtor) to choose a title or settlement company where the final closing took place. Contrary to popular belief real estate closings are not generally stress filled occasions with buyers, sellers, attorneys, closing agents, et. all using loud language and threatening everyone else in the room. That usually happens (if ever) well before the actual closing. I have witnessed few nightmares over my 20 plus years at closings. There was the one situation where a coffee cup plunked off the forehead of a middle aged divorcing husband when he brought his new 20 something girl friend along to sit across the table from the soon to be Mrs. ex. Mr. forgot the decree that states "those who trade in should do so out of view of the past model." It was a stellar effort by the future former Mrs. ex. She hit him squarely above his unibrow.
Back in the day the seller's side chose the closing company, all parties arrived, sat across the table, signed a series of docs and after a long period where everyone waited uncomfortably for the checks and documents to be distributed, keys and well wishes were exchanged and that was that. Now there could be a different scenario. Buyers may be choosing their own Title Company as to where they want to close. Seller's could choose a different company which means we could have closings that take place at two different locations. Who cares? Only the people who are trying to do this in the most cost effective manner. When Sellers choose a Title company and everyone closes there, only one closing fee is charged for the transaction. If buyers choose to close at a different location today, there will be a second settlement fee charged to someone ranging from $250 to $500 additional.
Oh and there's more documents. Have I mentioned the additional documents? Apparently to cover their assets, Title companies are going to be required to read a series of disclosures that could total some 17 pages prior to a closing with all participating parties. 17 fun filled pages. Can someone please bring along a copy of the complete Harry Potter collection?
If you are a consumer, just make certain it is spelled out in detail in your purchase agreement what exactly will take place and who's paying for what. Buyers and Sellers are going to have more choices in Today's New World Of Real Estate. You're going to need a representative who covers your assets so that it doesn't cost you more money. In the world there's legal protections for the consumer and then there's.....well, RESPA. Good luck with that consumers...if you don't get the right help to understand it all.