TITLE COMMITMENTS: WHAT ARE THEY?
A commitment for title insurance (“Title Commitment”) provides a buyer and lender with terms and conditions for how the final title policy will be issued. Title insurance offers protection for buyers and lenders from certain defects or errors in the title to a property. There are four main parts (called “Schedules”) of the title commitment.
Every year when the taxes come out we see a lot of confusion between buyers and sellers about how those taxes affect their transaction. Since one of our taxing authorities is already available (Williamson County) and the others will be soon we wanted to send out some details on how taxes affect a real estate transaction.
The first thing to note is that once the tax bills are out those taxes are considered to be “due and payable” to the county tax collector. This means we should be collecting and paying them from closing.
There are many reasons why a real estate closing can be delayed. Like cogs and gears in an intricate clock, there are so many parties involved in a successful real estate transaction. In visualizing this analogy, it should be understandable that delays can happen when some of the moving parts aren’t working in optimal conditions.
What is it?
When putting an offer together, realtors have the option of checking a box in the contract that could end up being very important to a buyer down the line. Paragraph 6 (A) (8) gives the following options:
What is FIRPTA?
The Foreign Investment in Real Property Tax Act (FIRPTA), enacted in 1980, requires foreign persons to pay U.S. income tax on the gains they make from selling U.S. real estate. FIRPTA applies to the sale of interests held by nonresident aliens and foreign corporations in real property within the United States. FIRPTA imposes a duty on the buyer in the transaction (not the title company) to deduct and withhold a portion of the sales price to send and report to the Internal Revenue Service.
Solutions & Precautions For Real Estate Transactions in a Time of Crisis
As we navigate each day together during this difficult time, we’re all finding ourselves quickly adapting to change in daily life and business. Although the news and recommendations are evolving rapidly, here are some solutions and measures we would like for you to be aware of in order to help everyone continue to move forward in their real estate transactions with Texas National Title.
OPTION MONEY: What is it?
Option money is a very important piece of a buyer’s contract. When a buyer pays an option fee they are purchasing the unrestricted right to cancel the contract in the time provided for in the contract. This timeline is intended to be used for buyer due diligence and if the buyer finds something that causes them to want to cancel the contract they can do so for any reason as long as the termination is done timely.
Let’s closely examine the contractual language of Paragraph 23 to discuss some key points: