Best tips: Preparing for the closing of your home

Rick Ripma  0:00  

Good afternoon, and thank you for joining us. I'm Rick Ripma, your hard work and mortgage guy and I'm Ian Arnold Advisors Mortgage Group. And we appreciate you joining us again, to get a hold of us just go to HardWorkingMortgageGuys.com That's HardWorkingMortgageGuys.com. And from there, you can contact us you can get all our contact information there or you can just fill out the information on the website and we will get back with you.

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Advisors Mortgage Group is proud to present Indy's Real Estate Gurus hosted by Rick Ripma, the hard working mortgage guy, please contact Rick for all of your mortgage needs that HardWorkingMortgageGuys.com. That'sHardWorkingMortgageGuys.com. Now, here's the hard working mortgage guy, Rick Ripma.

Rick Ripma  0:55  

Now we're gonna go over the numbers, what's kind of what's happened, you know, recently, there's a lot of a lot of really interesting information CoreLogic, which is one of the companies I don't really like them so much. Everybody says they're so great, but man, they've been so off, but they've just released their home price index report, which is showing that the home's rose by this is nationwide. 6.6% in June, that's an 18.3% on the year, year over year basis, which was a decline from 20.2. In May. But I mean, let's face it, that's still a huge number. Yeah, huge number. The point six rise in June was when the rates reached their peak also rates were as high as they've got got in June, they've come down since then. And so that's that's a pretty, I mean, it's pretty amazing. And that's also an annualized comp, return compound increase would be around 7.5%. Year over year, still a pretty good increase in the values of homes CoreLogic forecasts and home prices will appreciate point six in July. And, and 4.3 in the year going forward, which is what's pretty in line with what we believe it's a little lower than what we think it's going to come in, I think in I think we're going to be somewhere in the nine to 11%. And CoreLogic has been historically that I've seen has been way, way off there. They're not very accurate on a lot of these forecasts recently anyway, remember that 4% appreciation can still be a very meaningful for wealth creation. If you bought a home, we talked about this a week or two ago, if you bought a home for $400,000, you put 10% percent down, that means you would be you would gain 16,000 and appreciation 10% down would be 40,000. And so that 16,000 will be a 40% return on your down payment on your investment into the property. That's a pretty significant increase for what you put into it. There's also been a lot of talk about the increase in foreclosures. I'm sure everybody's heard it on the news, especially when you consider the first half of 2022 versus the first half of 2021. We saw 150% increase in foreclosures in that time. And that man, the media is really picked up on that, haven't they been?

Ian Arnold  3:17  

Yeah, but it's the same thing we talked about last week. It's just that bottleneck where you couldn't foreclose the year prior. So everything got pushed back. And then you had to go through all the paperwork. And you can't just foreclose on somebody in 15, 30 days, it takes months. So you got to send all their paperwork and to get all that stuff, legal and everything,

Rick Ripma  3:35  

right. But still these in these foreclosures, the numbers are kind of it when you actually look at them, it's kind of so misleading the way the media is doing it. So in 2021, the first six months, we had 65,000, just over 65,000 foreclosures for the first half of the year, and 2022, we add 164. So that's 150% increase. But guess what, in 2020, we add 165 We're right on line with 2020. If you look back, you look at 2010 It was 10 times that. So 12 years ago, we had 1,654,000

Ian Arnold  4:20  

Yeah, I mean, that's just incredible. I mean, that one that it was that many foreclosures I mean I know we were going through the recession of oh eight and stuff, but goodness, I still quite a few to foreclosure.

Rick Ripma  4:31  

It isn't what does it say? It says our markets still very, very hot. It's still a good market, don't listen to the media when they talk about their foreclosures. That really is not an issue. You know, along with that, and part of the reason that we're not seeing that we talked about the appreciation, that's part of the reason we're not seeing it because we weren't having the appreciation back then. existing home inventory is up 22% from the lowest levels in February. So how am inventory is going to be is a big part of this Even up 22% We're still way off of what we've had many in the media are claiming that there's been a rise in the inventory will lead to a housing crash, right? They're saying, Oh, we're gonna have a housing crash look at the the inventory came up. If you look at his history, history shows us what it and that it happens every year. Yes, it's a time of year. Yep. And why? Because

Ian Arnold  5:21  

summer, I mean, you gotta well want a couple of things is one you got schools, parents don't want to move their kids during, during, during their school year, they'd rather move them during the summer. The other thing is, especially for a northern states, who wants to move in the dead of winter?

Rick Ripma  5:37  

Not me, I don't know, who wants to move into the dead of summer in Florida, though, you know? Our guest, Ray Summeier. Well, he moved in the dead of summer. So I guess some people are crazy enough to do it. You know, the, the other part of that is our existing home sales, you got to remember that with the existing homes that the numbers are quoting about half of them are, are sold. They're saying they're sold, they just haven't closed yet. So they aren't really available. So the numbers aren't as aren't what they seem when they're talking about that. So these levels are not bad. These levels are actually I think, healthy for our market, we needed some additional inventory. And from what I'm seeing, I'm seeing more and more buyers come in and people I've had, in fact, the last two, I had pre approvals with them for a bet you eight to 12 months, maybe even longer. Now. I think one of them was more than 12 months. And they finally got a house because they finally got their offers accepted because there's more houses on the market to buy. So there's less, a few less offers going out. So it's a little easier if you're a home buyer, it's a little easier right now to get a home. So that that makes that really helps. You know, if you want to know kind of what's going on in your market, just go to HardWorkingMortgageGuys.com Look us up, send us an email in and I will get back to you and talk about you know what's going on with the market. Beyond that, today, we really want to talk to we don't want to talk he's here, Ray Summeier. And, you know, I've known Ray, I know it's over two decades, but I don't know how I don't know how much over two decades, but I know it's somewhere in the 20 something years 20 to 23 years. Yeah, it's been a long, long time.

Ian Arnold  7:25  

You talk to Rick for over 20 something years, and you still talk to him.

Ray Summeier  7:30  

He's a great guy. And he's very hardworking mortgage guy.

Rick Ripma  7:33  

Yeah. See, he knows. And and I'll tell you that the thing about Ray is, you know, when I when I met you, you were you were heading up a mortgage or a title company. And I mean, you still do that. But how long have you actually been in the title business?

Ray Summeier  7:50  

Well, 32 years, okay.

Rick Ripma  7:52  

I'm telling you, he's a guru. This guy, he's our go to, if I have a, if I have a purchase, we don't pick the title company goes to another title company. And there's an issue. I always call Ray. And Ray tells me what's going on or how to fix it. He knows. I mean, he's he knows all of this. And I really thought why not have Ray on and talk specifically about there's several things I want to but we don't have time on every show to talk about all of it. So I want to really talk about the closing. I think a lot of people are a little leery of the closing. I mean,

Ian Arnold  8:27  

yes. Because all I mean, even in our field. Yeah, think about it, all we do is Hey, once you get to closing your sign, and you're done, okay, well, that's, that's a big step. Yeah. I mean, no way, we just go, Oh, you sign and everything is done. Well, there's a lot more to it than just one little signature,

Rick Ripma  8:44  

right. And it's more than the club you have, you have the ramp up to the closing, there's things that the customer has to do the the borrower has to do, then you have the closing then you have after the closing. And I really, I want to focus it, it's obviously for everybody, but I want to make sure we get to the focus of you know, more of not more but at least first time homebuyer so that they really understand. In other words, getting a little more detail than we might for somebody who's closed on 25 homes, you know, somebody's closed a lot, but even then it changes

Ray Summeier  9:14  

every day. Every closing is different and how it's handled is different. So how we did closings 10 years ago, is totally different than how we do closings today.

Rick Ripma  9:23  

Right? And what not long that we I mean two years ago we were closing in our cars

Ray Summeier  9:27  

correct. And we still have some of those from date from time to time there.

Rick Ripma  9:30  

Yeah, we have a we have a lady that's closing on Friday that has COVID and and it's like you know, they'll just have to make arrangement for the closing but they will

Ray Summeier  9:40  

you can either do the power of attorney or like you said closing the car,

Rick Ripma  9:43  

right? Yeah so hard because all of a sudden you have COVID You know, it's man it just makes it it really tough. So right. What, what is the first step a homebuyer should take as it relates to you know, title on a home.

Ray Summeier  9:59  

Let's Ultimately, the buyers choice or the borrower's choice to get title insurance from a reputable company that they choose, and that they know that they can trust them to do a good job when it comes to in the search, doing all the prep work to get the commitment together, and issuing that final title policy.

Rick Ripma  10:15  

Yep, and your with Near North title. So, if we have a customer out there looking maybe they're for sale by owner, they need a title company, or maybe there's some real estate agents that are looking for a really high-quality title company, how would they get ahold of you?

Ray Summeier  10:31  

That's where to get me as all my cell phone, which is area code 317-710-1312? Or my email is rays@nntg.com Rays with an s correct. All right, rays@ntg.com, for Near North Title Group,

Rick Ripma  10:47  

and then t g.com. Near North titled group. So you've got to take me long to figure this out. So let's talk about so who my next question, who does a title? Who does the title company protect? And how do they protect them?

Ray Summeier  11:03  

Well, there's two different types of policies. When it comes to title insurance. There is an owners policy, and then there's a lenders policy, when you're doing a purchase, you have an option to purchase Owners Policy, and that protects the buyer of the new home, up to the purchase price of the home. If something were to happen in defect of the title, and the lender protects the lenders policy protects the lender or the mortgage company, for the loan amount on that particular property.

Rick Ripma  11:32  

And, and what exactly so so by protecting, you go back and you do some searches on the property.

Ray Summeier  11:39  

And we do a thorough inspection of the property on the history of the property. So we go to the recorders office, we go to the auditor's office, we go to the treasurer's office, and we do a thorough search to find out all information on a purchase. That's anywhere from 30 to 30 years in the past, on that particular property, we're looking for liens, we're looking for mortgages, we're looking for judgments, we're looking for delinquent taxes, and we'd come back and put all the information together into a title commitment form, which is a three different schedules that talks about all the information on that property, okay.

Rick Ripma  12:15  

And if something, let's say, four years down the road, something I don't know how often it probably doesn't happen very often because you guys do so much searches, but if something came up, you're protecting them from that coming up, they would not have to pay for it if it was missed on the search,

Ray Summeier  12:30  

right and that's what the title insurance product is. It's a one time cost you paid at closing. And if it's an owners policy, if the owner is suffers a loss, then that owner were protected or if the lenders not in the lien position that they think you should be able to protect the lender at that time.

Rick Ripma  12:48  

Okay, perfect. Well, you know, after the break, we're going to talk more with Ray about, you know, really what, what you need to bring to closing how you know, and what happens after closing.

Unknown Speaker  12:59  

Advisors, mortgage broker licensed by Indiana Department of Financial Institution equal housing opportunity. NMLS 33041 Rick Ripma NMLS 664589

Rick Ripma  13:08  

Hi, I'm Rick Ripma. With the hard work and mortgage guys and advisors Mortgage Group, where we believe delivering the best mortgage for you is why we exist, and it's how we all succeed.

Unknown Speaker  13:16  

We believe honesty, kindness and hard work are how we honor each client at hardworking

Ian Arnold  13:21  

mortgage guys, we believe in custom tailored loans, not the one size fits all approach.

Unknown Speaker  13:26  

We believe in always presenting you with all your options. So you get the loan you want the way you want it. We believe

Unknown Speaker  13:32  

in continually monitoring the rules, rates and market trends. So you don't have to

Unknown Speaker  13:37  

we believe in working hard to meet your closing date so that your entire plan isn't upended. We believe in offering the same quick online process that the bookstore mortgage companies brag about whether you're refinancing

Unknown Speaker  13:48  

or buying your first home,

Rick Ripma  13:50  

we believe there is the best mortgage for you and we believe we are the team to deliver it find us online at hardworking mortgage guys.com.

Announcer  14:03  

Brought to you by advisors Mortgage Group, where we believe the more you know about financing a home the less stressful buying and refinancing will be

Rick Ripma  14:16  

Welcome back and thank you so much for joining us. This is Indys real estate gurus. I'm Rick Ripma, your hard working mortgage guy and I'm Ian Arnold with Advisors Mortgage Group and we thank you again for joining us if you need to get a hold of us go to HardWorkingMortgageGuys.com That's HardWorkingMortgageGuys.com. From there you can have all our contact information. And if you want to fill out the information there and send us a question or you want to look at doing a mortgage just let us know and we'll do our best to answer your questions.

Ian Arnold  14:44  

Also, if you did miss our first 15 minutes talking about Ray Summeier, definitely check out our podcasts are indys real estate gurus again, that's indys real estate gurus or listened to any of our last podcast. You can listen to anything you want. And even so what, what? What chapters you want to listen to?

Rick Ripma  15:03  

Yeah, no one just right. I talked about the numbers. Well, we,

Ian Arnold  15:07  

we don't listen to you. All right, so it's time for question or the week. Now it's time for questions with the gurus. The question of the week is brought to you by renovation loans, if you're looking at getting a home, and it just needs a little bit of work, guess what, we have the loan for you. It's our renovation loan. And Rick and I do these quite a bit we can easily get you taken care of. And you can have the new kitchen or new bathroom or even new bedrooms or whatever you want installed in your house without having to worry about that coming out your pocket later.

Rick Ripma  15:46  

Yeah. And that part of our company's called Fix it mortgage. Yeah. So it is part of us. And we actually have some, some people who are just very specialized in that industry, they are in that part of, of lending is a difficult part of lending. Those programs are a little bit more difficult. But those those guys have last I checked, it was 130 140 years’ experience between them all, so not very much, not very much. And the guy running it is the most knowledgeable person I've ever met on that product. He's actually helped Freddie and Fannie set up their programs. So he really knows it. Or maybe it's FHA, one of them. He's helped helped set up their program. He's in there. They're consulting group that helped do that, because it's because he had done it for so long. They used they used him.

Ian Arnold  16:28  

Alright, so last week's question was, what has has a bank but no money? The answer a blood bank? They don't have money. All right. So the new question for this week is, I give milk and I have a horn, but I am not a cow. What am I? I guarantee you, people 50 Plus will get

Rick Ripma  16:51  

this answer. Yes. Well, you know, younger generation no chance there's a thing. Right. You can tell he has kids, right? Yes. My question. See, right. Yeah, you can tell he has kids, because these are definitely great. They're great questions, because they make you think about I don't know, I, I these things always. I don't think that way. So I have trouble. You know, answering them. But I'm sure I just Google it. Google solves everything. Yeah, Google solves it all. Well, let's get back with the questions for Ray Summeier. Again, Ray is with Near North Title Group. And your title is Senior Vice President of residential services.

Rick Ripma  17:35  

Yes, I knew it was a long one. And you've been doing this for 30 30 Some years already. So I'm here. So you know, title in and out, we talked a little bit about, you know, what title is? What is it that somebody and how to get related? So let's say you have a you have a for not a first, let's say you have somebody who's selling their home, and that they're selling it for sale by owner. So they need a title company? When should they contact the title company? And what kind of things are you going to do for them,

Ray Summeier  18:06  

we can help them put the parties together. Once they get the contract all written up, they can send the contract of purchase agreement to us. And we will start working on that research and working on the search and the commitment for the property. And then if they're working with the lender, contact a lender to get their information to coordinate and collaborate with him on all the information that they may need as well.

Rick Ripma  18:30  

And I think you all I know that you may not be a normal thing that you do, and I may be wrong, but I think if somebody's if they're doing that they need someplace to put the earnest money.

Ray Summeier  18:41  

Yeah, well, we're hold earnest money for the for the buyer and the seller, whether it's for sale by owner or a agent deal as well. We'll be happy to hold that earnest money, but then into our escrow account, it's safe, it's protected, and we'll party sign an escrow agreement, showing what earnest money is for

Rick Ripma  18:59  

Yeah, I think that's critical to do if you're for sale by owner, yes. If you're the especially if you're the buyer, you want to make sure that you you're the title company is somebody other than the seller is holding your money. Exactly. So I think that's that's a critical piece. So now they've gotten too close and you've gotten, actually before they get to the closing, or there are many questions that the title company normally has for a customer, the buyer or the or the seller when he

Ray Summeier  19:26  

has some communication with the seller beforehand, because we want to make sure we get all the information from the seller on their existing mortgages. And if they don't exist mortgages, we find out they don't even mortgages, if there's a homeowner's association on the property, we'll want to get that information from the seller who the the management company is so we can coordinate with them to get all the payoff information or all the lien information and HOA information to make sure that that's transferred successfully, versus any other miscellaneous information on the property that we didn't know. We'll get that from the seller or buyer at the time. Okay, closing Yep.

Rick Ripma  20:01  

So they don't have to. It's not you, you generate all the conversation, the customer really doesn't have to generate anything towards the title company. Once they've got it all set up,

Ray Summeier  20:10  

especially on a for sale by owner, the first thing we ask for is everyone's contact information. So we'll ask for I mean, typically, it's normally the buyer or the seller that sends us a contract. And we'll ask for the other person's contact information right away, so we can start reaching out to them, and also at the buyers getting a mortgage, we'll ask for that mortgage information so we can reach out to them as well. Okay,

Rick Ripma  20:30  

just a little office, and we'll get back to the purchase. What about a refinance? I know, you know, the lender picks the title company. They don't have to

Ray Summeier  20:40  

know they don't have to. I mean, sometimes when a borrower meets with their mortgage company, they'll let them know hey, I closed my last one with your Near North Title Group. I'd like to get back with you them again. Right. Or another type of company. Yeah,

Rick Ripma  20:51  

right. Yep. So they can they can pick it. Generally, they just go with it. Whoever the lender, like for us generally. Yes. Yeah. So most of the time, that's what happens. So I've got a company right near North Title Group racing, Mr. Summeier

Ian Arnold  21:04  

Rick today.

Rick Ripma  21:07  

Been, Been been that way for 20 something years. So that they do that. That's how they that's how they pick it. Or that's how that's done. So on a refinance, there's not much that the customer has to do they just show up to closing correct.

Ray Summeier  21:21  

We don't meet to refinance borrower until the time of closing, unless there's some issues with the title. Now there's issues where there's judgments or paths, mortgages, we all sometimes have contacts with those buyers before them or borrowers before then. Okay.

Rick Ripma  21:34  

So this at closing, this is pretty much for even for a refinance or a purchase, but at closing, what happens? What does it what does the borrower need? What is the seller need? You know, what do they have to have at closing? And what happens at closing? What are they doing their

Ray Summeier  21:51  

most important thing anytime before closing is we need some type of government issued photo ID, because we got to be able to confirm that the person is coming before us is the person who they say they are. And then one way to do that is through that government issued ID that can be a driver's license. That can be a ID card, that can be a passport, but something that's government issued. So we can verify. When we look at your ID and look at you sign in, you are one of the same person.

Rick Ripma  22:18  

Okay, so what you said is a photo ID photo government issued ID Correct, right? Okay. That's what, that's what I've seen. And that's another that's another thing. So if you're going to buy a home, or if you're going to refinance a home, make sure your driver's license or whatever ID you're going to use has not expired.

Ray Summeier  22:37  

Exactly. Because nine out of 10 times if we have an expired driver's license, we cannot use that that person will actually have to go to the DMV and get that license renewed before we can accept it. Yeah, there are some exceptions on that. But for the most part, that's the general rule. Yep.

Rick Ripma  22:52  

And a lot of times, like I have a, I have a passport and a in a driver's license with my driver's license happen to be expired, I could bring my passport or vice versa, that is correct. But if you don't have that, or if you, you know, you're moving. And maybe you're moving from another area and you drove for hours for your closing, and you didn't have you don't have an ID, that's a problem.

Ray Summeier  23:13  

We have to make some phone calls and see if we get some waivers and take care of. You also want to make sure when you're checking with your lender, some lenders require a second piece of ID, whether it's a social security card, insurance car or something like that. But some, so you want to make sure your lender does not require that second piece. It's not as common as it used to be. But some lenders still require two pieces of

Rick Ripma  23:35  

Yep. So if you do then just have to make sure you know what you're getting anything else now. So then, so that's what they need to bring, what do they do at this closing? What are they doing?

Ray Summeier  23:44  

First thing we're doing is we're just, we're greeting everybody. And then we're up, we're sitting at the document table going over documents, we would typically start with, we all like numbers, right? We all like money or things. So the first thing we go over normally is is that settlement statement that kind of breaks down the numbers, whether it's a purchase or refinance, we start with the purchase price or loan amount, and we go over fees, deductions, things we're paying off and then bottom up bottom numbers. Most people want to know that up front, but where's my money going? So and then we start going over the title and lender documents executing those. I'm explaining those to the customers to make sure they understand what they're signing. And then we execute those documents. There's some documents that require a notarized so we will notarize those for the customers. Yeah.

Rick Ripma  24:31  

And so how long does a closing generally take?

Ray Summeier  24:36  

Typically, a refinance will take no more than 30 minutes and a purchase no more than an hour. Okay. So we always recommend people to allow at least an hour for closing just in case there are issues. Some lenders require for a purchase that we have to get funding approval, so they want to see the executed documents before they can actually give us the approval to cut those checks and release funds.

Rick Ripma  24:59  

Okay, you I, I know, with it's one of the things I like about advisors is we fund we on a purchase, we try to fund the day before. And we I don't remember a time we didn't fund in time.

Ray Summeier  25:12  

No, you guys are great at that. So I appreciate that. And

Rick Ripma  25:15  

the other thing is, is in Indiana, there's something called the good funds law. So if some if a customer if a buyer has to bring money to closing, how do they bring? How do they have to get that to you?

Ray Summeier  25:26  

Indiana is a good fun state law that states that if the funds to close is under $500, that can be done by a personal check. If it's $500, and one penny, up to 9999 and 99 cents, you can bring a cashier's check once the good once the proceeds to closing reaches $10,000. All funds must be remitted by a form of a wire.

Rick Ripma  25:51  

Okay, can they mix and match match it? Or is if you're like bring 999?

Ray Summeier  25:56  

Note once it reaches 10,000 It has to all funds have to be done by 10,000. Okay, all right. Perfect. I mean by wire All right, perfect. Yeah.

Rick Ripma  26:04  

Yep. All right. So what happens after the close, and does the borrower need to do anything after closing,

Ray Summeier  26:09  

after the closing, we will record the documents, the deeds and mortgages. And then once those are recorded, we're positioned we can order to process the policies, the owners policy learners policy, we will produce those and send those out to the respective parties. We will also file the exemptions for the customer, the homestead and mortgage exemption. One thing we always recommend the customer does is when they make that first payment, they want to verify those exemptions are filed to make sure they are on the property to keep the discount on those taxes if applicable to that property.

Rick Ripma  26:42  

Right. And that's and that's really important. The tax

Ian Arnold  26:44  

Yes. What to ask, does all title companies are just is that Near North Title standard?

Ray Summeier  26:49  

I can't speak for all title companies. But I do know that we're one of the few that will actually record both of those for the customer

Ian Arnold  26:57  

and save the customer money. Oh, darn

Ray Summeier  26:59  

you guys. Customer service.

Rick Ripma  27:02  

And I'll tell you, that's a big deal, because that's it. I mean, most title companies do not file that. And it and if you miss it, I'm sure that's why a title company doesn't want to file it, because if they miss it, then they're probably liable. liable. And and that, and that's the difference between that could be almost double the taxes if you don't have that file, right.

Ray Summeier  27:23  

The Homestead Exemption is the biggest exemption. So you want to make sure definitely that was filed, right? The mortgage exemptions not as big. So yes,

Rick Ripma  27:31  

perfect. Well, we're out of time. And we do appreciate you joining us again, if you would like to contact us go to HardWorkingMortgageGuys.com. That's HardWorkingMortgageGuys.com If you want to contact Ray, how do they do that?

Ray Summeier 27:44  

Again, it's Ray Summeier. With Near North Title Group, my phone number is 317-710-1312 or email at Rays@nntg.com.

Ian Arnold  27:54  

We're great. We appreciate it. And tune into us next week, where we'll talk about what are mortgage points? And then what all does your payment include. So it does include escrow doesn't include any of that stuff. We will go through all that next week.

Rick Ripma  28:09  

Perfect. Thanks for joining us have a great weekend.

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Brunch NMLS number 33041 Recruitment NMLS number 664589. And Arnold's NMLS number is 1995469. Equal Housing opportunity, some restrictions apply.