Smart Money: Agent's limited access to closing documents 'a lovely fairy tale'

Dear Juan: Your real estate agent is reciting a lovely fairy tale. I don’t have to ask the question: I know counsel is not representing you. You’re treading where angels fear to go. They want you to sign things that you haven’t reviewed, don’t understand and, even upon reviewing, probably still won’t understand. Please do yourself a kindness and find a real estate attorney who can handle the entire transaction for you. Doing so is well worth the cost.

Time for a his-and-hers deed?

Dear Bruce: My boyfriend and I are discussing moving in together. He owns a home, and half of his mortgage is less than rent on my apartment. If I foot half the bill, should I ask for my name to be put on the mortgage? I want to make sure that my credit is protected and that I will easily be able to buy a home on my own if something were to go awry in our relationship. I could have my lawyer draw up an agreement, stating I would be the one to move out and he would retain his house in the event of a breakup. —M.J., via e-mail

Dear M.J.: The fact that you’re moving in together does not mean you’re getting ownership of the home – those are two separate issues. If you’re paying half the mortgage, it’s not unreasonable to ask for some credit. But he may have equity to which you would not be entitled. Hire an attorney. You can both tell the lawyer what you are trying to accomplish, and an agreement can be drawn up to smooth the transition in the event of a breakup. If I were in his position, I don’t think I would be enthusiastic about including you on the deed. The mortgage is not an issue – that’s what he owes – but it’s the deed that would convey ownership.

Re-examine insurance figures

Dear Bruce: How can I get private mortgage insurance off my house? My husband and I bought a house in December 2006, putting down $25,000. To our surprise, it was used to buy down the points. Our interest rate is 7.7 percent. We paid $300,000 for the house. Our PMI is an extra $1,045 a month. My husband is self-employed, and the lender only used his name on the loan due to my credit, even though I have had the same job for 20 years. I had the house reappraised a month ago, and it came in at $365,000. I wrote to the mortgage company and sent all the necessary paperwork, along with a letter asking for the PMI to be removed. They responded, saying that we have not met our 80 percent and would not remove the PMI. Do you have any suggestions? I don’t want to lose our house, but paying $3,500 a month is crazy. Also, can we deduct the PMI payments on our taxes this year? —L.M., via e-mail

Dear L.M.: A $12,000-a-year PMI premium on a guarantee seems extraordinary. You should sit down with a banker, explain the circumstances and let him make suggestions. He may know a good mortgage broker. The whole business of paying down the points with what you thought was the down payment has a certain odor about it.

Hanging on to grandma’s house

Dear Bruce: My grandmother passed away two years ago, and her two remaining children, my aunts, got her house. One of my aunts out bought the other, making her complete owner of the house. My grandmother had four children (my mother and uncle are deceased), so if anything were to be passed down to her children, the children of the two deceased siblings would be in line to receive their parents’ portion. No one knows anything about a will except my two aunts – and they’re not talking. How do I go about getting a copy of my grandmother’s will? I don’t speak to either aunt, so I can’t ask them directly.

My grandmother’s house is about to go into foreclosure. The aunt who ended up with the house took a lot of money out and seems to have let it go. If my grandmother left the house for all her children, we have rights to it, but I won’t know any of that unless I see the will for myself. I am interested in getting the house and using it as a rental or finding another family member who will keep it in good shape. How do I get the house before it goes into foreclosure? Would it be easier or cheaper to get it once it goes into foreclosure? —K.B., via e-mail

Dear K.B.: I have to believe there’s little you can do. Your grandmother passed away, but your mother and uncle preceded her in death. If the will didn’t specifically deal with the question of passing on rights to the next generation, the likelihood is that any rights your mother had would have passed with her. In a will, you can state that the next generation will inherit proportionately the rights of the first heir, but this is not ironclad.

Secondly, the will may not have been filed for probate. It’s easy enough to go to the probate court where your grandmother died and ask if a will was filed. It’s a public document. It may well be that your aunts just took the house and assumed it to be theirs. It also could be that the aunts went to the probate court and had one or both named as administrators of your grandmother’s estate. Again, it’s a legal question, but I doubt whether you would have any standing because there are two children alive.

If the house does go into foreclosure, you have every right to bid on the house, and there’s nothing your aunts can do about that.

Bruce Williams is a national radio talk show host and syndicated columnist. He can be reached at bruce@brucewilliams.com.