On Saturday, March 21, 2020 at 5:00 p.m., Governor, J.B. Pritzker issued a public order (“Order”) directing Illinois residents to shelter-in-place. The shelter-in-place is, for now, effective through April 7, 2020. During this time frame, how is your real estate transaction going to be affected?
The short answer is that real estate transactions will proceed as planned. Under the Order, there are several exceptions or permissible activities that may still be performed. These are called “Essential Businesses and Operations.” Under this category, Financial Institutions (i.e. banks, title companies) and Professional Services (i.e. legal services, accounting, appraisals) are allowed to continue operating. As such, real estate transactions can proceed as planned and deals can still close during this period.
However, as an added precaution and based on recommendations from the title companies in our area, the following procedures will be followed:
All cash transactions will be closed electronically via e-mail and/or DocuSign. Any funds to be provided at the closing will need to be sent via wire transfer to the title company. Documents required by the title company to be an original (i.e. Deed) should be dropped off or sent via overnight courier to the title company prior to closing. Once the transaction has concluded, copies of the pertinent documents will be sent via overnight delivery to all parties. Any proceeds due will either be wired or a check sent via overnight delivery. There is also the option to pick up your documents and check at the title company.
Transaction with a Lender
Seller(s): It is very common for sellers to sign their closing documents in advance, give their attorney a power of attorney for closing day and not attend the closing. Our office has always offered this service and will continue to do so during this time period. Moreover, title companies are encouraging sellers not attend closing and send their documentation prior to closing. Therefore, for our seller clients, our office will coordinate with you to get your signature on the necessary documents in advance of closing. The few documents requiring signing on the day of closing we will execute on your behalf under a power of attorney.
Once the transaction has concluded, copies of the pertinent documents will be sent via overnight delivery to all parties. Any proceeds due will either be wired or a check sent via overnight delivery. There is also the option to pick up your documents and check at the title company.
Buyer(s): Due to the fact that many loan documents are required to be wet signed and notarized, buyers must still attend the closing. Title companies are requesting that only the buyers required to sign the loan documents and their attorney attend the closing, so as to limit the number of people at the title company. The title companies have implemented some safety measures to ensure a safe and clean environment. All closing rooms will be cleaned with disinfectant after every closing. The pens used will be new and disposed of after closing. Also, they will limit the number of people allowed in the facility and practice social distancing recommendations when possible. Some title companies are also offering drive by closings, where buyers can pull up, sign the documents in their car, and hand them back to the title representative.
Once the transaction has concluded, copies of the pertinent documents will be sent via overnight delivery to all parties. Any proceeds due will either be wired or a check sent via overnight delivery. There is also the option to pick up your documents and check at the title company if you choose to wait after signing.
In short, your real estate transaction should proceed as planned with just some slight modifications for the closing. Lenders, attorneys and title companies are still working during the shelter-in-place period. Fournier Law Firm, Ltd. is committed to assisting our clients in making your closing as smooth as possible. As your closing nears, our office will be in contact with you to coordinate the necessary steps to get your deal closed.
Technology seems to be the heart of the real estate market. It begs the question, do house hunters and owners selling their house still feel that they need to use a real estate agent? Based on a recent housing consumer study completed by Harris Insights, the answer is a resounding yes.
In fact, the percentage of home buyers or sellers who used a real estate agent in a recent transaction has increased 5 percentage points from the last study three years ago and up 9 percentage points since 2001.
Many might assume that the older population of buyers and sellers are the most likely to use a real estate agent for their transaction. After all, Gen Xers and Millennials are tech savvy and more accustomed to navigating the virtual world. However, according to an article published by Housing Wire, “91% of those ages 18 to 34 used real estate agents in their transaction. That number is slightly higher among Gen Xers, or those ages 35 to 44 years old, at 94%…Actually, it’s the older generations that are cutting real estate agents out of the picture as just 81% of those ages 55 and older reported using a real estate agent in their transaction.”
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Real Estate is a popular investment vehicle for American investors. In fact, 89% of investors put their money into real estate, according to a report by Better Homes and Garden Real Estate. In a recent article published by Forbes, real estate experts provide reminders and warnings regarding real estate investments in order to help insure a profitable investment.
One real estate professional, Lee Kiser, reminds investors to study the real estate taxes of a property before making the purchase. Its important to understand what the upcoming tax liability may be down the road, and a real estate tax professional may be able to help an investor prepare accordingly.
Shelling out the money for a professional inspection and appraisal might not be top of the list for investors, but according to Angela Yaun of the Day Realty Group, it may help save more money for the investor later. The investor may be able to get items covered under a home warranty if they are proven to be functioning at the time of the inspection. It can also make the buyer aware of repair expenses they should plan for later. A professional appraisal will provide the most accurate square footage and appraised value, important facts to have on hand when the investor is looking to sell their property.
The article goes on to detail the importance of understanding Home Owners Association restrictions, obtaining a Master Land Use plan for the area surrounding the property, and getting accurate and professional estimates for repairs, holding costs and closing costs.
Read the entire article.
Photo Credit: Antonio Carlos Cascatrina