Selling Your Home in Massachusetts? Don’t make this classic legal mistake.

by Joshua Blumen on Friday, April 6th, 2018

“What is the biggest legal mistake a seller can make?”

As a real estate closing attorney, that’s a question I hear a lot from listing agents who want their clients to avoid legal landmines.

The answer is easy: The biggest legal mistake sellers make is taking a piecemeal approach to getting the legal support they need.

Instead of hiring an attorney to handle all the legal paperwork and negotiations that are part of every closing, sellers end up patching together legal documents and services from different sources. And they do it without the full benefit of advice and guidance from an experienced real estate attorney.

Why is this dangerous? Because sellers who take a patchwork approach to legal services often put their interests — and their closing — at risk. The closing process can be overwhelming for sellers. There’s a lot of paperwork. There’s a lot of numbers. And it’s easy to miss details that can delay or derail your sale.

Just ask the sellers who thought that completing a purchase and sales agreement was a simple matter of filling in the blanks. Or the sellers who thought that the phrase “broom clean” was just a figure of speech. Or the sellers who discovered that their agent wasn’t allowed to give them the critical legal advice they didn’t think they’d need.

Important: Your listing agent is an expert at marketing and selling your home. Your agent may be seasoned and supportive. Your agent has a fiduciary responsibility to protect you. But your agent does not provide the same services as an attorney and they cannot provide legal advice. Experienced agents know that crossing this line isn’t worth the liability. They also understand the value of expert legal advice to keep everything moving forward.

This is why experienced agents urge sellers to retain a real estate closing attorney to represent the seller’s interests.

What’s the best way to find a real estate attorney for your closing?

Ask your listing agent for a recommendation. And keep these tips in mind:

  • Start looking for an attorney when you first list your home — not when your closing is 24 hours away. You want an attorney managing the process and working in your best interests long before the actual closing.
  • Experience matters. Choose an attorney who focuses on real estate closings. Ask for references from other seller clients. Did the attorney return calls quickly? Did they help solve problems — or point fingers? Would they work with the attorney again?
  • Look for an attorney who offers a package of essential seller representation services for a flat fee. Are these services clearly defined? Does the package include preparation and negotiation of all documents? Does it include legal advice and representation up to and through closing?

The closing process can be challenging. Make sure you have an experienced real estate closing attorney on your team to give you the legal support you need — and the peace of mind you deserve.

Selling your home in Massachusetts? Get the legal help you need. For more information, contact the Law Offices of Joshua Blumen, P.C. 781-784-2500.

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Down Payment Gifts: Not just for first-time homebuyers

by Joshua Blumen on Thursday, May 31st, 2012

Can my family give me the money for a downpayment on a home purchase in Massachusetts?

Absolutely! As a matter of fact, according to IRS guidelines for 2018, anyone can give another person – family or not – up to $15,000 per year without having to file a gift tax return.

This means that mom and dad can jointly give you up to $30,000, or jointly give you and your spouse up to $60,000 for your down payment with no additional tax filing requirement. You can also receive gifted funds totaling more than your down payment amount. Just make sure each gift giver knows that any amount over their IRS limit requires them to file a gift tax return.

With home prices soaring, first-time homebuyers aren’t the only people using down payment gifts. In the Massachusetts market, it’s not uncommon for homeowners to use gifted funds to upsize, relocate, or even buy a second or vacation home.

Thinking of using gifted funds for your down payment? Keep these critical points in mind:

  • If the person gifting you funds expects to be paid back, that’s not a gift — and it’s not going to fly if you’re working with a lender.
  • Even though the IRS says anyone can give you money, if you’re applying for a FHA, VA or Mass Housing loan, the gifted funds MUST come from a family member.
  • If you use gifted funds for your down payment, your lender will need to know the details. Requirements will vary, but at the very least, you’ll need to provide:
  • A signed gift letter from your donor confirming the amount of the gift, and that this amount is indeed a gift and not a loan to be repaid.
  • A copy of the bank statement for the account that was the source of the gifted funds.

Buying a home in Massachusetts? Get the legal help you need. For more information, contact the Law Offices of Joshua Blumen, P.C. 781-784-2500.

Know what to expect when you refinance

Refinance FAQ: No Check at the Closing?

by Joshua Blumen on Monday, January 23rd, 2012

I am refinancing my home in Massachusetts to pull out cash because mortgage rates are so low.  How come I don’t get a check at the closing? 

The short answer is that there will not be any “cash-out” refinance money available until a few days after your signing. Let me explain…

When you are refinancing your home – your primary residence – you have three days after signing the mortgage, the note, and all of your lender’s closing documents to think about whether or not you really want to go through with it. This three-day period, which serves as a consumer protection, is referred to as the Right of Rescission. At your closing, you will receive two copies of your Right to Rescind which tell you how to cancel the transaction during the three-day period, at no additional cost.

The three-day rescission period begins with the first day after you sign your closing documents. For example, if we sign your refinance closing documents on Monday, your rescission period would be Tuesday, Wednesday and Thursday. Provided that you have not cancelled the transaction by midnight on Thursday, the refinance will become final on Friday, which is the day your closing attorney will receive money from your new lender to fund your new loan.

Once your closing attorney receives the money from your new lender, your attorney will record your new mortgage, payoff your old mortgage, and send you a check for any money you were getting back.

Refinancing your home in Massachusetts? Get the legal help you need. For more information, contact the Law Offices of Joshua Blumen, P.C. 781-784-2500.