Top 10 NJ Real Estate Questions: Answered

nj real estate

  1. Do we need a home inspection if the home we’re buying is new?

Home inspections are of the utmost importance. Without one, it’s impossible to know if a house is in excellent condition, even if it was built recently. Because there are many expenses throughout the process of purchasing a home, it’s understandable that it’s tempting to skip hiring a home inspector. Resist this impulse, though; investing in a home inspection is not something you’ll regret.

If you want a detailed tour of the inner workings of your prospective home, accompany the inspector on the inspection. Either film the process or keep copious notes throughout; something that seems perfectly clear now might be entirely foreign to you in ten years when you next need to access the information.

  1. Why do I need to hire a New Jersey real estate attorney?

In New Jersey, your real estate lawyer is tasked with handling the contract. Your attorney will be accompanying you at each stage of the transaction: scheduling meetings, overseeing the home inspection, answering your questions, and most importantly, protecting YOU. Your real estate attorney will do everything possible to protect your interests.

A real estate attorney will handle the enormous amount of paperwork that must be completed when you’re buying or selling a home. This paperwork is dense and packed with legal and real estate jargon. Your attorney will be able to walk you through this paperwork clearly and concisely; these explanations are intended to help ensure that the deal you’re making is beneficial to your long-term financial health.

  1. What will my closing costs be?

Despite their name, closing costs are really payments toward your taxes and mortgage interest. After closing, you’ll have two months before your first mortgage payment is due.

Unlike making a rent payment, your mortgage payments will always be for the month that’s just passed. If your monthly mortgage payments are going to be large, that will be roughly equal to what you’ll need to put down at closing.

Your yearly taxes will be divided into twelve equal parts and are due along with your monthly mortgage payments.

  1. If I’m buying a home, am I required to get a survey?

Absolutely not; in fact, if your lender doesn’t absolutely insist that you get a survey, you can skip it. They’re unnecessary and quite costly. If you are in fact able to avoid getting a survey, you’ll be able to save up to $1,000.00.

  1. Should I be worried if I was only able to secure a conditional commitment on my home loan?

This really depends on your situation. Because a conditional commitment means that your lender will only offer you a loan if certain conditions are met, problems can often crop up if those conditions aren’t met on schedule. When this happens, escrow can drag on, and a transaction can fall through. Your real estate attorney will be able to look at the terms of your conditional commitment and help you stay on target.

  1. If I got a firm commitment, am I guaranteed that my loan is secure?

A firm commitment sounds like a sure thing, but even though a lender has promised to offer you some amount of debt, there are still specific terms involved on your end. You will need to fund the loan before the end date, or your loan will expire and you will likely have to pay a cancellation fee. If you want to pursue the loan again, you will need to re-apply. Your new loan won’t have the same terms, however; the interest rate will almost certainly be different.

  1. Do I need home insurance?

YES. Home insurance is essential, and it is always a bargain. It will protect your interests in a myriad of ways, ranging from fire damage to personal injury liability should someone be injured while on your property.

Although replacement value home insurance is slightly more expensive, it’s well worth the extra cost. In order to secure a mortgage, you’ll be required to name the lender as insured on this policy. Your insurance agent will be able to add the lender’s name for you. Should there be any damage to your home that impacts the lender, your insurance will compensate them on your behalf.

  1. What happens at closing?

This is a meeting between your realtor, you, and possibly the seller’s realtor. You will be signing the closing paperwork, after which the deed will be yours.

The seller may or may not be at the closing. Often the seller has already taken the time to sign the closing paperwork. The seller’s attorney may also have power of attorney, in which case the attorney can sign paperwork.

The seller often decides not to attend the closing meeting. Tensions can be high between the buyer and the seller as a result of complications that have cropped up throughout negotiations.

  1. Will my attorney be present at the closing meeting?

Your NJ real estate attorney will be at your side helping you during the closing meeting. Having your attorney with you will serve the dual purpose of steadying your nerves and making sure that the deed and the mortgage are executed properly.

  1. How does the appraisal process impact the transaction?

The appraisal considers a number of factors to determine whether or not the home you’re trying to purchase is worth the price you’ve said you are willing to pay. This secures the lender’s confidence that you’re not going to borrow more than the home is actually worth.

If the home is appraised at or above the price you’ve agreed to pay, closing can proceed as planned. If not, another round of negotiations must begin.

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