Houston, TX · Member since 2012 · 84 posts · 14 votes
The seller and I came to an agreement on price, I sent her the contract, but the probate attorney said that I need to send a HUD. I thought the HUD was the paperwork at closing with all of the transaction info on it? Is this normal? This has been a drawn out process dealing with the probate process.
Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
13y
Sounds like the probate attorney wants to see the preliminary HUD-1 settlement statement. That would show all the credits and debits and the bottom line that the seller is going to get. While the final version of this is created right at closing, its not at all unusual for preliminary versions to be created before closing. Assuming you're dealing with a title company, they can create these, provided they have the necessary information.
Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
13y
Sounds like the probate attorney wants to see the preliminary HUD-1 settlement statement. That would show all the credits and debits and the bottom line that the seller is going to get. While the final version of this is created right at closing, its not at all unusual for preliminary versions to be created before closing. Assuming you're dealing with a title company, they can create these, provided they have the necessary information.
Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
13y
Are you going to close with a title company? You don't have to, but you really should. You would start by taking your contract to a title company and ask them to start the process. "Opening Escrow" its called in CA, but I never heard that term when I lived in TX and bought property there.
In your position, I'd start by finding a title company. Take your contract to them and they can get going.
You could create a HUD-1 yourself. But I don't think you'll have enough information to do it accurately. You have to deal with all the recording fees, title insurance charges, tax prorations, etc.
Investor · Central Valley, CA · Member since 2012 · 6k+ posts · 3k+ votes
13y
You can find a downloadable HUD1 online to fill out. But you really have to know a lot about closing costs and tax prorations, etc to fill it out. I make net cash offers. That way the sellers (and their attorneys) know exactly what they are getting at closing. If you say they are getting $20K at closing, they are getting $20K. Either way, you'll need to fully understand all the costs involved. Without a preliminary title report, you don't even know what the issues are (liens or past due taxes, etc.). I'd tell the attorney that without a preliminary title report you can't provide a HUD1. Have the exec. sign the contract and get it into escrow.
Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
13y
But, again, Reggie Youngblood, if you DIY the HUD-1 or make a net offer, the issue is the same. You really need to understand what costs are involved in the transaction. If you make a net offer that you think gives you $5K in profit, but you've neglected $5K in transaction related costs, your profit could disappear.
Have you every bought or sold a house in TX? If so, dig through the paperwork from that transaction and look at what's on the HUD-1.
Also, title companies typically get paid at closing. So, you hand over the contract and tell them what's going on and they start the process. You're not going to have to shell out any cash up front. They get paid when the transaction closes.
Investor · Central Valley, CA · Member since 2012 · 6k+ posts · 3k+ votes
13y
I think Jon and I are saying the same thing in that you probably don't know enough about the total costs of this deal without a preliminary title report and the help of title company. The attorney is (supposedly) looking out for his client by asking for a HUD1. However, if the executor has full powers, he or she can sign the contract without the attorney's approval. IMO, most estate attorneys are deal killers when there is a problem property involved. They usually just don't know that much about RE, and I find that they aren't very helpful to execs and heirs with problem probs or estates with debt issues.
Jon Holdman What's it called in TX when you submit a contract to a title company? Do TX title companies also serve as escrow agents?
Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
13y
I don't know. I bought and sold two houses in TX and don't ever recall anyone using any term like "open escrow". We moved from TX to CA and bought a house right away and that's where we heard that term.
Yes, title companies do this in TX rather than attorneys like in the east.
Investor · DFW / Austin, TX · Member since 2013 · 188 posts · 80 votes
12y
@Jon Holdman FYI because I thought you'd be interested: I have heard it regularly called "open escrow" in Texas as well, at least among local investors in Austin