Minors in Title to Real Estate

Minors in Title to Real Estate

 

Minors in Title to Real Estate

There are times when a minor is in title. Maybe the deed from Mom & Dad says “Susan B. Jones, a minor.” Or, when she shows up to sign papers, the Realtor® notices the nanny who brought her in. Of course, a child can inherit property. The parents never intended for the child to own it so soon, but it happens.

Are there problems with minors in title?

Custodian

Washington has adopted the Uniform Transfers to Minors Act. This is the most practical way for minors to “own” property. There is no document or agreement. The statute deals with the responsibility of the custodian to the child. Otherwise, you can have a…

Trust

A trust can be set up for a minor, either separately or by language in a will. The trustee can also transfer property to a custodian (who can even be the trustee) if the trust permits it. But if there is no trust or custodianship, you need a…

Guardian

A guardianship is often what happens when both parents are deceased without making provisions for how a minor child can deal with property. It’s not absolutely necessary unless real property must be sold or mortgaged, but a court must approve any real estate transaction.

Most of us know there may be a problem, but what is it, exactly? Can little Suzie even be in title? Can she convey or mortgage the property? How?

Well, yes a minor can be in title, and it happens all the time. That’s not the problem – if she doesn’t want (or need) to sell or mortgage the property now, she will eventually be old enough to do something with it.

But until Suzie reaches the legal age of majority, she is under a type of “disability” because she lacks the capacity to enter in to binding contracts. If she signs title away when she is 17, she can disavow it when she reaches the age of majority and for some time thereafter.

What if a minor needs to sell or mortgage the property?

The only way for Suzie to sell or take out a mortgage is for someone to go to court, open a guardianship, appoint a guardian, get a court order authorizing the transaction, and have the guardian execute the deed or mortgage. Also, if a guardian has been appointed in another state, an ancillary court proceeding will be needed because the foreign court does not have jurisdiction in Washington.

All this can be expensive and time consuming and pretty onerous if the transaction has to happen now. But, there is no alternative – the horse is already out of the barn, so to speak. The conveyance to Suzie (or her inheritance) can’t be undone.

Other ways for a minor to own real estate

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Download a printable version of this article. CLick the following link: Minors in title to real estateMinors to Title in Real Estate

There are other more practical ways to deal with children owning real estate.  One is a trust, where title is conveyed to the trustee of the trust, or the trust is set up in a probate. In that case, the title company will need to see the trust document or the will.

A custodianship pursuant to RCW 11.114 is a simple alternative. In that case, title is conveyed to an adult of legal age: “John Paul Jones, as custodian for Susan B. Jones, under the Washington Uniform Transfers to Minors Act.” The statute provides for only one custodian per child per deed, and a trust company can be named as well, if the trust permits it. It used to be called the Uniform Gifts to Minors Act, and you might see this recital in a deed coming from another state. A deed can be accepted from a custodian in any state, which need only recite the adult custodian, the custodianship and the name of the minor.

When title is vested in a custodian, title insurers do not need to call for any proof of authority or documentation. This is an advantage of a custodianship over a guardianship for all concerned. Acknowledgments for a custodian would be for the adult individual, because there is no documentation to present to the notary, while a guardian would use the representative capacity (for a fiduciary) form.

Of course, during the custodianship the adult has a fiduciary responsibility to the minor, and can’t dispose of or use the assets for personal gain. The money from a sale of a house would still belong to the minor. But third parties, including title companies, don’t need to question where the money will end up.

What happens when the minor reaches legal age?

Once the minor reaches 18, 21 or in some cases 25 years of age (it all depends on the circumstances of the transfer), the custodian is to convey the property to the minor. But as an adult she can deal with the property in her own name. With a guardianship, the court action needs to be closed, and the property distributed to the minor.  A custodianship is a convenient way for a minor to hold title, but there can be estate planning and taxation ramifications when children own real estate. An attorney should always be consulted if a minor is or will be in title.

Questions or comments?  Please share below!

What is a Land Contract?

What is a Land Contract

What is a land contract

Seller Finances the Purchase

A land contract is an installment contract in which the seller finances the purchase. The seller maintains the deed until satisfaction. It is comparable to owner financing. The buyer gives the seller a down payment and the seller acts as a bank; financing the balance of the purchase or sale price.

The Interest Rate is Negotiated by the Parties

The interest rate is negotiated and set by the parties involved. Land contracts can be created on or used on most types of property such as residential, land only, mobile home with land, commercial, mixed use.

During the Course of a Land Contract

The buyer has possession of and equitable title to the property while the seller holds legal title. If desired, the buyer may assign and convey his/her (buyer’s) interest in this contract or any part thereof, provided, however, that such assignment or conveyance shall not impair the seller’s security in the Premises. Once the contract is in effect and for the duration thereof, the buyer will be responsible for all taxes and assessments.

The seller conveys legal title by way of a Statutory Warranty Fulfillment Deed to the buyer when the contract is paid in full and all terms are fulfilled free and clear of any liens or encumbrances other than taxes and assessments for the current year.

What to Expect at Escrow Closing – [Video]

What to expect at escrow closing


Now that you’re ready to buy or sell a home it’s time to close the deal. But what does that really mean? What happens at closing and how long does it take? Well the process varies depending on your location, but here’s a general overview of what you can expect at closing.

Escrow’s Role in a Real Estate Transaction

As your Escrow Closing Team, we will follow the terms of your Purchase and Sale Agreement, and use these instructions to complete the transfer of the property from Seller to Buyer.
We’ll ensure that any items on your title commitment have been cleared, prior to closing. We also maintain a detailed accounting of all the finances involved with the purchase of your property. Most importantly, we prepare the legal documents that transfer ownership, from Seller to Buyer.

Escrow carries out instructions per the terms of sale

It all starts when a buyer and seller agree on the terms of sale and ends four to eight weeks later at closing. In the middle, all kinds of stuff happens to make sure the terms of sale are met. It’s the kind of stuff you’re thankful someone else does while you’re getting ready to move.

Then at closing, the escrow officer confirms the terms of sale are met, makes sure the funds are distributed, the deed is recorded, and the keys are delivered. if you’re the buyer, this is when you finally get possession of your house.

Closing the sale of a home doesn’t have to be mysterious! find out more about how it works with the resources below.

What is a Title Commitment

What is a Title Insurance Commitment

What is a Title Insurance Commitment

Be Aware Early of Matters & Exceptions to Coverage

A Title Commitment provides a list of the matters which will be shown as exceptions to coverage in a designated policy or policies of title insurance, if issued concurrently, covering a particular state or interest in land. It is designated to provide a preliminary response to an application for title insurance and is intended to facilitate the issuance of the designated policy or policies.

Since these exceptions may point to potential problems with an intended purchase,
it is important for all parties to review the report once it is received.

Title Commitment

Corefact ProofDownload a PDF of this article here
The Ticor Title Title Commitment is an offer to issue a policy of title insurance covering a particular estate or interest in land subject to stated exceptions.

It is normally prepared after application (order) for such policy(ies) of title insurance on behalf of the principals to a real property transaction. The Title Commitment states on its face that it is made solely to facilitate the subsequent issuance of a title insurance policy and that the insurer assumes no liability for errors in the report. Accordingly, any claim arising from a defect in title must be made under the title policy and not the Title Commitment.

If a title policy is not contemplated, a Title Commitment should not be ordered. Instead, consideration should be given to requesting a Subdivision Guarantee Report or other similar title product.

After a title order has been placed, matters relative to the title policy coverage on the subject property are assembled in a title search package and examined by skilled technicians. This is when the Title Commitment is prepared and sent to the customer. The report contains relevant information so that the parties to the transaction will become aware of matters which will not be insured against by the title company.

This report is issued before the title policy, hence the name Title Commitment.

How to Eliminate Signing/Consummation Date Guesswork

TRID Calendar

TRID Calendar - Determine Consummation Date
By now, we’re all familiar with the Closing Disclosure delivery period and review period guidelines set forth by the CFPB. The delivery and waiting period guidelines have made it more challenging to plan and schedule signings because the delivery method, non-working days, and federal holidays all have to be factored in when determining the earliest possible consummation date or required delivery date for a specific consummation date. And of course, there’s the 3-day rescission period that applies to refinance transactions.

To eliminate the guesswork and speed up the calculation process for our clients and partners, we are happy to announce the availability of the Ticor Title TRID Calendar. The TRID Calendar is an interactive tool that illustrates all the important dates in three simple steps.

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NOTE:

If a federal holiday falls within the Delivery and/or Waiting Periods, add an additional business day.

The three-day period is measured by days, not hours. Thus, disclosure must be delivered three days before closing, and not 72 hours prior to closing.

Disclosures may also be delivered electronically to the Delivery Period and may be signed in compliance with E-Sign requirements.

Where to Find the TRID Calendar

Access the TRID Calendar at http://ticortitle.com/cfpb/calendar.htm on a desktop, tablet, or mobile device.

How the TRID Calendar Works

Determining the delivery period, review period, consummation date, and rescission period can be achieved in three simple steps:

  1. Specify loan purpose (purchase or refinance)
  2. Specify delivery method (personal delivery, mail delivery, electronic delivery)
  3. Click a date on the calendar to specify signing/consummation date

The TRID Calendar will instantly illustrate the delivery period, review period, signing/consummation date, and rescission period (for refinances) to the calendar.

Save a PDF for Your Records

TRID Calendar PDFAs a convenience, the TRID Calendar provides the option to create and save the calendar as a PDF. To create a PDF of your illustrated calendar, click the “CREATE PDF FILE” button at the bottom of the TRID Calendar page . The PDF file displays the delivery period, review period, consummation date, rescission period, as well as holidays that occur during any of the periods. Also included in the PDF is an explanation of Consummation.

What is Consummation?

Consummation is the day the borrower becomes legally obligated under the loan, which would be the date of signing, even if the loan has a rescission period.It is important to note the definition of consummation can be different than the closing date as defined in the purchase agreement where the buyer becomes contractually obligated to a seller on a real estate transaction.

What to Look For in a Title Insurance Company [video]

What to look for in a title insurance company


Ok so you know title insurance is important for verifying the title of your property, right? So trusting in the right company is also important. But how to you pick the best provider?

Experience, Reputation, and Reliability

Well, as you work with your real estate agent or lender, here are three things to consider when looking for a title insurance company: experience, reputation, and reliability.

Every state is different so the company you choose should have solid partnerships with local businesses, representatives with significant experience in your community, and expert knowledge of your local laws.

You also want a title company with a good reputation for solving complex problems, mediating difficult circumstances, and dealing with any situation that comes up. Because you never know what might come up! And finally you want a representative who’s backed by decades of reliability with the financial stability to be around for many years to come.

So as you work with your real estate agent or lender ask about the title company and choose one that’s experienced, reputable, and reliable!

About Title Insurance

Title policies insure owners and lenders against possible losses from claims against real property ownership. The preliminary report or commitment provides advance information on matters which will be excepted from coverage. Lenders and owners are thereby given an opportunity to correct title flaws before purchasing or lending.
Title insurance originated in the 1870’s to stem a series of land ownership problems that developed from inaccurate record searches, forgeries, and related problems. Today, it offers protection from certain items that cannot be determined from public records, such as forgeries of all types, undisclosed heirs, hidden marriages and divorces, clerical errors, and invalid legal procedures and interpretations.

Policies are written on the basis of a search of public records and other records which impart constructive notice. Remember, a deed does not prove that the seller is the owner of the property. Only title insurance can protect your interest in the property from unknown encumbrances, legal conflicts and unforeseen claims.

A policy of title insurance is like a pre-paid legal agreement. Your insurer will provide legal defense against challenges to your insured title (dependent, of course, upon the type of policy coverage ) and will reimburse you financially for losses due to the covered defects in your ownership rights.

It is important to remember that a lender’s title policy does not insure a borrower against title risks. While certain types of policies pertain to both the owner and the lender, it makes good sense to help protect your borrowers by explaining the limitations of their particular coverage.

If you have any questions regarding which policy would best suit the needs of any particular situation, contact your Ticor Title representative.

Ticor Title Spokane Welcomes Brian Kobs

Ticor Title Spokane Welcomes Brian Kobs

Ticor Title Spokane Welcomes Brian Kobs

Welcome Brian Kobs

We are pleased to announce the expansion of our Spokane Operation with the addition of Brian Kobs – Sales Executive.

With over 10 years in sales, Brian is known best for his hard work and commitment. Clients compliment Brian for mending the communication breakdowns that inevitably happen in our business. “Sometimes this is verbal communication, sometimes it is an inability to communicate feelings and emotions. Either way, though questions and empathy most of these obstacles can be overcome somewhat painlessly.”

Contact

Phone: 509-344-9992
Fax: 855-885-2346
Brian.Kobs@TicorTitle.com

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What is Brian passionate about professionally? “I am most passionate professionally about contributing to achieve common goals with my team /work family. Celebrating personal success is typically a lonely activity. There is little that is as emotionally fulfilling as the feeling you get when you celebrate a victory as a team.”

What about personally? “I’ve shared the last 23 years of my life with the most amazing woman I’ve ever met. Whatever I do is always better when my wife is involved. Any lengthy conversation with me will inevitably include some reference to Sara-Jayne.” Camping, boating, or fishing are fun ways that Brian likes to spend his weekends.

Please help us welcome Brian Kobs to the Ticor Title Spokane Sales Team.

Remember to specify Ticor Title on your next transaction and be sure to order your Property Profile at cs.spokane@ticortitle.com!

Escrow Locations

Spokane
1330 N Washington St, Suite 3525
Spokane, WA 99201
Phone: 509-327-2381
Fax: 866-878-4105

Spokane Valley
720 N Argonne Rd , Suite E
Spokane, WA 99212
Phone: 509-928-9665
Fax: 509-928-7018

What is Escrow [video]

What is Escrow


Making a simple financial transaction is pretty straightforward, right?
You get the goods, he gets the money, and a receipt is your proof of ownership. But how do you make a financial transaction as large and as complicated as a home purchase or refinance?

How Escrow Works

That’s where escrow comes in. Your escrow officer is an essential partner who mediates a complicated financial transaction to make sure it’s done accurately and fairly.

Here’s how it works: When a buyer and seller come to an agreement on the terms of sale, everyone involved gives their part of the transaction to the escrow officer. Then the escrow officer ensures everyone does what they agreed to do before handing over the deed and distributing funds appropriately.

And by the time the property changes hands or the refinance is complete, all the variables are coordinated and everyone has peace of mind it was all done correctly! To learn more about escrow contact your Ticor Title representative.

Escrow Workflow

Click to Download

Escrow Workflow

The Escrow process in 12 steps. This flowchart illustrates which items are performed by escrow and which items are performed by the Lender.

Click here to download

The Property Tax Annual Cycle in Washington State

There are few things in life that are as certain as taxes, especially when it comes to buying, selling, and owning real estate.  In this article, we’re going to take a specific look at common questions relating to property taxes, including when they are due, when they may be paid, how they’re calculated, and what tax relief programs are available.
Click Here to View a PDF version of this infographic.Property-Tax-Annual-Cycle-graphic

 

The Property Tax Timeline

Property taxes have a timeline that is different than most other taxes or bills that we pay. Let’s take a look at the facts:

  • Taxes are due twice a year, but towards the middle each cycle
  • First half taxes are due at the end of April and cover January through June
  • Second half taxes are due at the end of October, and cover July through December
Click  the following link to download a printable version of the Property Tax Annual Cycle Infographic.

Property tax proration

Because taxes are due toward the middle of the period they cover, a real estate seller may receive a refund or pay prorated taxes depending on the closing date.  For example, a sale that closes in March will have both parties paying prorated taxes: the seller pays for January 1st to date of closing, and the buyer pays from the closing date to June 30th. A closing that happens in May, would give the seller a refund for prorated taxes from the closing date to the end of June, since the seller would have paid in April for the entire first half of the year.

Can property taxes be paid in advance?

When are taxes due?

1st half are due the last day of April, 2nd half are due the last day of October. King County mails out a statement in the middle of February.

Taxes for the second half of the year can be paid in advance, but the first half can’t. Washington State law (RCW 84.56.010) doesn’t allow county treasurers to collect property taxes until February 15 of the year that they are due. So the first half is typically payable any time between Feb 15th and April 30th; and the second half is typically payable any time between Feb 15th and October 31st. It is not necessary to have a tax statement to mail in with your payment. If you decide to mail in your payment without a tax statement, you must write your tax account number on the check. Mailed payments must be postmarked on or before the due date otherwise they will be considered late.

How are property taxes calculated?

How taxes are calculated

The two factors used in the calculation of taxes are the assessed value of the property and the levy rate for that area. Levy rates are represented in dollars per thousand, so to calculate the tax amount multiply the assessed value by the levy rate and divide by 1,000.

The property tax for a given parcel are based on a fairly simple calculation: multiply the total assessed or taxable value of the parcel by the levy rate for that parcel’s neighborhood. In addition there can be fees added by the county to cover specific services like noxious weed control.

Last Year’s Assessed Value x This Year’s Levy Rate = Tax Amount Due

What determines the levy rate?

The levy rates are determined by a number of factors, including the results of voter-approved levies. Property taxes usually aren’t certified until the middle of February, even though the assessments were mailed out the previous year (which often causes confusion). In other words, the assessed valuation statement you get in the 2ndhalf of this year has no effect on the taxes you are paying this year. The valuation will be used in the calculation for next year’s taxes. You won’t know the actual tax you will need to pay for 2016 until the county certifies 2016 taxes in the middle of February, even though 2016 assessed values have been available for months.

Assessed value vs. taxable value

The assessed value is typically the same as the taxable value except in cases where the taxpayer has applied for and received an exemption. For example, senior and disabled property owners may qualify for tax reductions. In some cases home improvements may qualify for a 3-year exemption for taxes on the value of the improvement. For more information on possible exemptions or tax defererals, contact the Assessor-Treasurer for the county in which the property is located.

What tax relief programs are available?

Here are some examples of tax relief programs and special classifications that may be available in your area:

  • Open Space Classification for Agricultural land, Timberland, and Natural preserves.
  • Designated Forest Land Classification for timberland parcels 20 acres or more.
  • Historical Restoration Exemption for historical significant property undergoing restoration.
  • Improvement Exemption – Single Family Dwellings a temporary exemption of valuation of additions to single-family dwellings.
  • Destroyed Property Claim adjustment to the valuation of destroyed property. (King County – please note this program is handled by the Admin department, for further information please contact them at 425-388-3038).
  • Property tax exemptions for senior citizens and disabled persons
  • Full tax deferrals for senior citizens and disabled persons.
  • Exemptions for qualifying property owned by non-profit organizations.
  • Property tax deferral for those with limited income.

Property tax resources:

King County property tax resources

King County Assessor-Treasurer hotline: (206) 296-3850
Find your tax parcel account number: King County tax parcel search
See or print a tax statement: View or print King County tax statements here.
Make online payment: Pay King County Property Taxes Online
Make checks payable to: King County Treasurer
Mailing addresses for property taxes: King County Treasury 500 Fourth Avenue, Room 600 Seattle, WA 98104

Pierce County property tax resources:

Pierce County Assessor-Treasurer hotline: (253) 798-6111
Find your tax parcel account number: Pierce County tax parcel search
See or print a tax statement: View or print Pierce County tax statements online here.
Make online payment: Pay Pierce County Property Taxes Online
Make checks payable to: Pierce County
Mailing addresses for property taxes: Pierce County Budget & Finance P.O. Box 11621 Tacoma, WA 98411-6621

Snohomish County property tax resources:

Snohomish County Assessor-Treasurer hotline: (425) 388-3433
Find your tax parcel account number: Snohomish County Tax tax parcel search
See or print a tax statement: View or Print Snohomish County tax statements online here.
Make online payment: Pay Snohomish County Property Taxes Online.
Make checks payable to: Snohomish County Treasurer
Mailing addresses for property taxes: Snohomish County Treasurer 3000 Rockefeller Ave, M/S 501 Everett, WA 98201

Spokane County property tax resources:

Spokane County Assessor-Treasurer hotline: (509) 477-3698
Find your tax parcel account number: Spokane County Tax tax parcel search
See or print a tax statement: View or Print Spokane County tax statements online here.
Make online payment: Pay Spokane County Property Taxes Online.
Make checks payable to: Spokane County Treasurer
Mailing addresses for property taxes: Spokane County Treasurer
PO Box 199
Spokane, WA 99210

What is Title Insurance [video]

What is Title Insurance


Everyone has a checklist of things they look for when buying a house, right? Like maybe looking for a quiet tree-lined street in a neighborhood with good schools not far from work. These are all important things to consider. But what about the property’s history?

How Title Insurance Works

Over the years things like liens, easements, and subdivisions may cause confusion over who has rights to the property. And the last thing you want as a homeowner is a big kerfuffle to put your property in jeopardy! That’s where title insurance comes in. When you buy or refinance a home, title insurance confirms there are no disputes over who has rights to the property.

Here’s how it works: Unlike auto, health, or homeowners insurance where you pay a monthly premium for value after an action, you pay for title insurance upfront to protect you from future claims.

By the time you’re ready to close the deal, title insurance gives you and your lender peace of mind that any disputes or restrictions are resolved or known. To learn more about how title insurance protects your rights to your home, contact your Ticor Title representative.