What does the attorney do for the borrower
in a refinance transaction?
attorney will review the loan commitment, order
the title search, and prepare the transaction
for closing. The attorney will also submit a
complete closing package to the new lender, complying
with all of the lender's title requirements,
prepare the closing statement, and conduct the
closing. In addition, the attorney will order
a new survey if required and asked to do so by
the borrower. After the closing, the attorney
will record all necessary documents and pay off
existing mortgages as applicable.
Why do I need to obtain a new title search
and title insurance for a refinance transaction?
is a very commonly asked question. Each time
that you refinance, or put a new mortgage on
the property, it is considered a separate event.
If there is a new lender, or simply a new loan,
that new loan must be insured. In addition, a
new title search must be obtained to make sure
that there have been no intervening liens or
title defects since the time that you purchased
or last refinanced the Property.
What is the cost of title insurance for a refinance
a refinance transaction, a new lender's title
insurance policy must be issued, not a new owner's
policy. As such, the cost of the title insurance
should be less then when you purchased. The cost
of title insurance is regulated by law, and in
the case of a refinance will be based on the
amount of the new loan. It has been our experience
that the costs for title search and insurance
set forth on the Good Faith Estimate provided
to you by the lender, are most often incorrect
and are lower than the actual fees.
Do I need a survey for a refinance transaction?
answer to this question depends on your lender.
Most lenders will accept your current survey
depending upon its age and provided that you
can sign a “Survey Affidavit of No Change.” You
must check with your lender to see what their
survey requirements are. You will be able to
sign a “Survey Affidavit of No Change” if you
have not made any changes to the property or
the structures since the date of your most recent
survey. Of course, you will need to provide our
office and the lender with a copy of your survey.
It is our policy not to order new surveys for
a refinance transaction unless the client specifically
requests us to do so.
What about the homeowners/hazard insurance?
your mortgage loan commitment. The commitment
will likely specify that you need to obtain insurance,
insuring the new lender and the new loan amount.
Most lenders will not permit you to close unless
you have provided them with a declaration page
from the insurance policy together with a receipt
evidencing that you have paid for the policy
for one year in advance. In most cases, these
insurance items must be submitted to the lender,
before they will even permit us to set a closing
date. You must refer to your loan commitment
for the exact language that your lender requires.
Most lenders are very precise with this requirement.
It is advisable to send us copies of all insurance
information that you provide to your lender.
Is there an actual closing for a refinance?
the closing will occur at our office or at your
home. The procedure is essentially identical
to a purchase transaction, except that there
is no Seller. You will need to be present, together
with your spouse or partner, if applicable. One
of the attorneys of the Firm will review and
explain all of the documents to you and will
conduct the closing.
Do I need to bring money to the closing?
depends. If you are “cashing out” you may actually
be getting money from the closing. If money is
due to you from the closing, the money will be
available to you on the third business day following
the closing. This is because there is a Right
of Rescission in most refinance transactions.
If you are not cashing out, you will likely need
to bring a check to the closing. The check will
have to be a Bank Check or a Cashier’s Check,
made payable to the closing attorney’s trust
account. If you need to bring a check to the
closing, the actual amount will be provided to
you a day before the closing by one of the Firm’s
real estate paralegals. Personal checks cannot
be used at closing.
What happens after the closing?
the closing, this office will attend to all of
the post-closing aspects of the transaction.
Within a few weeks after the closing, you will
be provided with all of the relevant documents
from the closing. You can expect to receive a
statement or coupon book from your new lender
so that you can begin paying on your new loan.
If you don’t receive either, please contact your
lender directly. Many lenders allow you to have
the monthly payments deducted automatically from
your bank account. Check with the lender if you
are interested in that feature.