Settlement Resources

Whether as a buyer or seller, at some point you will need the services of a real estate settlement company or a title company.  Friendship Title is both.  We can both coordinate and conduct the closing of a sale of real property and we can issue the title insurance policies that are a part of the transaction.  In the State of Maryland, the buyer has the right to pick the settlement/title company.  In DC it is not quite the same, and although many sellers do concur with the buyer's choice for the title company, they have a right to pick their own.

In a typical transaction, Friendship Title receives a copy of the contract from the realtor or the buyer (if there is no realtor involved) and the process is begun.  A title search is ordered for the property for the purposes of determining whether or not the title is good and marketable.  A survey is ordered on all properties but condominiums.  The buyer has a choice between a house location drawing and a boundary survey.  A boundary survey identifies property lines and can be used to build a fence or an addition to the house.

Information for Buyers

When your settlement is scheduled with Friendship Title, you will receive an information packet via email.  In the packet is information about the settlement and some forms to sign and return to us. Also included will be a list of settlement costs, excluding lender fees and escrows. Your lender will give you a Loan Estimate which will contain their fees and an estimate of the other costs of the transaction.  As you approach the date of settlement, your lender will furnish you with a "Closing Disclosure" which will itemize ALL costs of the transaction.  

As you purchase your new home you are faced with decisions regarding title insurance.  A lender requires lender's title insurance to protect themselves from flaws in the title, but for owners, the purchase of title insurance is optional!  Why do you want title insurance?  

The business of title insurance is protecting ownership of your home - often the largest financial transaction you'll make in your life.  For a relatively low, one-time premium, you're protected against legal problems over property rights that could cost tens of thousands of dollars - even the loss of your home.  Dollar for dollar, an owner's title insurance policy is one of the most cost-effective forms of insurance available to homeowners.  Best of all, your one-time premium protects you for as long as you or your heirs own your property.

Information for Sellers

To begin preparation for your settlement, Friendship Title will send an information packet to you by email.  In the packet is information for you and forms that need to be completed, signed and returned to us.  If you have a mortgage, we will contact that lender to obtain a payoff statement, and we will also contact any condominium or homeowner association if your property has one.  For Maryland properties, we will also determine if you are or have been a permanent resident of the State of Maryland.  Non-Maryland residents are required to pay a tax of 7 1/2% of the net proceeds to the Comptroller of Maryland for sales of Maryland properties.  

We will prepare a settlement statement or Closing Disclosure, which we will send to you prior to settlement for review.  At settlement you will sign the transfer deed, the Closing Disclosure and several other forms connected to the sale.  We will withhold funds from your proceeds to pay the final water bill (unless you have a condo that pays the water) and refund any overage to you.  An estimate of other settlement fees will be furnished to you in your information packet.

The proceeds from the sale will be wired to your bank unless you request our escrow account check.

Fees

MARYLAND FEES

Generally, in the State of Maryland, there are three (3) taxes paid to either the county or to the State.  In Montgomery County, 1% of the sale price is paid to the County, 1/2% is paid to the State, and a recordation tax of $8.90 per thousand of the sale price ($13.50 for any amount over $500,000.00.) is paid to Montgomery County. For other Maryland counties, please contact us for tax rates and additional information.

Your information packet will give the dollar amount of taxes for your particular county.  It is the common practice in the State of Maryland that these three taxes are split evenly between the buyer and seller.  Exceptions to these taxes are available to first time Maryland homebuyers and buyers who are purchasing a primary residence.

Please contact us for our settlement fees.

DISTRICT OF COLUMBIA FEES

DC has two taxes, a transfer tax and a recordation tax.  For properties with a sale price of less than $400,000.00, each tax is 1.1% of the sale price. For properties $400,000.00 and higher, each tax is 1.45% of the sale price.  The seller traditionally pays the transfer tax, the buyer pays the recordation tax.  The buyer also pays the cost of recording the legal documents, $31.50 for a deed, $156.50 for a deed of trust.  

Please contact us for our settlement fees.