Execution of Documents

How documents are executed (or signed) can be one of the single most important factors of how enforceable a contract may be in case of a dispute. Anytime the property is being sold, the seller should reflect the actual title owner and any spouse. There are exceptions to the spouse rule, of course, but generally speaking on residential property you will include the spouse whether listed as an owner or not.

If the record title owner is deceased, that title owner should NEVER be listed as the seller on the contract. If the deceased owner had a will and probated the will, then the court appointed representative will be listed as the seller.
For example: Paula Hester, Independent Executor for the Estate of Mickey Mouse, deceased.
It is really important that the seller's capacity be listed--Independent Executor, Dependent Executor, etc.

If the deceased seller died without a will, then we would simply list all of the heirs individually as the sellers. Each seller/heir would be required to sign all documents. To determine the heirs without a will, Affidavits of Heirship would be prepared.

If the record title owner is a coporation, then the corporation name will be listed as the seller.
For example: Fidelity National Title Agency, Inc.
The documents will be signed by an authorized corporate representative and would be listed like this: Mickey Mouse, President World Wide Cartoons, Inc.

Another common type of sellers are Trusts. A Trust seller would look like this:
Paula Hester, Trustee of the Paula Hester Living Trust.
The contract signature line would look the same as above.

If the parties are using a Power of Attorney, the seller would be the actual seller's name, but the signature line would look like this: Paula Hester, by Mickey Mouse Attorney in Fact.

There are many different types of entities that you may encounter as sellers or buyers! Don't be afraid to ask questions or look to us for assistance in completing your contracts!

Paula Hester
Escrow Admin DFW

Seller Financing...A Thing of the Past?

With the ton of new laws and regulations happening in 2009 and 2010, you may have missed the one that impacted seller financing!! Under the Safe Act, states were to pass legislation to ensure mortgage originators were properly licensed and registered with the state. That's good, right?! We want better educated and knowledgeable loan officers in our industry...

But what about private money financing? That is where the problem lies....now anyone that loans money for real estate purchases must be licensed by the State of Texas as a mortgage originator. No longer will the seller be able to simply carry the note himself/herself when the borrower cannot obtain financing through traditional loans.

There is an exception for seller financing your homestead, however!! So where your seller is selling her homestead, the law would allow for her to carry the note just as we always have.

I think we have over-regulated at this point. I really believe we could have protected our buyers by means other than cutting off a source of financing especially where we have so few options now. What do you think? Is this consumer protection or over-regulation?!

If you want more information on the new law check out our local HUD website here:

http://portal.hud.gov/portal/page/portal/HUD/states/texas

Have a great weekend everyone!

Paula Hester--Escrow Administrator DFW