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Getting Professional Help with the Home Closing Process: An Interview with Mack Zimmerman of Zimmerman Law Firm

Tell us a little bit about your experience, firm's history, and the areas of law that you practice.

I started my career working for a firm in Fort Worth, Texas, doing commercial real estate transactions almost exclusively. In 2000, I joined a firm in Southlake, Texas, still doing mostly real estate work, however I began to broaden my practice to non-real estate transactions and financing. I started The Zimmerman Law Firm in 2007 and today we are a full-service transactional firm handling real estate, M&A, debt and equity financing, bank/lender representation, and general business matters. I owned a title company office from 2000 to 2007 where we performed residential and commercial real estate transactions for customers.

What's the role of an attorney in home closings in Texas?

Because of the economics of selling or refinancing a residential property, most buyers, sellers, or borrowers do not hire an attorney to represent them in that transaction. Some people do however and in that event usually the attorney will review or draft documents, such as the purchase contracts or closing documents. Many times the attorney will be asked to review the title work prior to closing and/or help cure title defects that arise prior to closing. In certain instances, clients will hire an attorney to review their home mortgage documents prior to signing and to explain the documents to them and answer any questions they have.

What are the basic steps involved in the home closing process?

Usually, with a residential transaction, the system is designed to be as streamlined and uniform as possible, again because of the economics associated with a home sale or refinance. The process begins with the parties entering into a purchase contract. From there the buyer will have a short inspection period to have the home inspected and to do any other due diligence they choose. During that inspection period, the buyer usually can terminate the contract for any reason during the inspection period. There is also a short title review period for the buyer to object to any issues effecting title to the property that are shown on the title commitment received from the title company. Once those hurdles are cleared, the parties are all moving toward closing.

As soon as the contract is signed the buyer usually begins to secure its financing/mortgage. Some contracts have financing contingencies stating that the buyer can terminate the contract within so many days after signing if they have not been able to secure financing on acceptable terms. Assuming financing is not a problem, the parties will then make arrangements with the title company and mortgage company to close on the agreed closing date. The title and mortgage companies are then working behind the scenes to prepare for closing.

Once closing nears, the buyers and sellers may ask to review closing documents the day or two before closing and make any last minute changes if necessary. At closing the title company will prepare a HUD 1 settlement statement detailing the financial side of the closing transaction with all the costs and prorations associated with the deal. The day of closing the parties will go to the title company office and sign closing documents. The mortgage company will fund the loan and the title company will coordinate all the details of the transaction. The buyer will walk away with keys to their new house.

What are the key points about buying or selling a home in Texas that people should be knowledgeable about?

One issue that comes up a great deal in Texas is the reservation of mineral rights. If the seller wishes to keep the minerals with the property (assuming they own them), they must state that they are reserving the mineral rights in the purchase contract and the warranty deed both.

What are one or two things that the seller can do to help make the home closing process easier?

One is that when they list the property, they can ask the realtor to have the title company run a title commitment early even though they do not have a buyer yet. Some title companies may not want to do that because it costs them money, but if they will agree to, it is a great way to make sure there are no title problems on the property and if there are they can be fixed before you even have a buyer come along.

Second, the seller could, if they wish to spend the money have an inspection done prior to having a buyer in line. This inspection can be useful in two ways. An inspection it will let the seller know if there are any defects that need to be repaired or if the seller does not wish to repair the item it will at least know it may be a negotiating point.

Also, if the inspection is clean, they can provide it to the realtor to provide to prospective buyers as a selling tool. Having said all this about inspections, I would caution sellers in doing this as well because they have an obligation to disclose to the buyer any defects with the property that they are aware of. Therefore, by doing an inspection in advance it may create a situation where they become aware of a defect that they were not previously aware of that now has to be disclosed or face liability to the buyer if it becomes an issue.

What are one or two things that the buyer can do to help make the home closing process easier?

The buyer can smooth the process by seeking pre approval from a lender while they are looking for a home, instead of waiting until they are under contract to first call a mortgage company.

What's the best way for people to reach you and your firm?

    The Zimmerman Law Firm, P.C.: 141 Countryside Court, Suite 150, Southlake, Texas 76092
  • Tel. 817-251-9222
  • Fax 817-251-9226
  • mack@zimmermanfirm.com
  • www.zimmermanfirm.com

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