Borrower HELOC Engagement Letter

The Schweppe Law Firm, P. A.
Attorneys at Law
Post Office Box 1269
211 East Warren Street
Shelby, North Carolina 28150-1269

Thank you for selecting The Schweppe Law Firm, P.A. to represent you in closing the Home Equity Line of Credit of your property. Upon receipt of the necessary information from your Lender and other third-parties to the transaction, we will assign your file to a Paralegal in our Office, perform a title examination of the property, and prepare all necessary documents for closing. In preparation for your closing please give the following matters your prompt and careful attention.

Closing

Your Lender may have scheduled your closing for you. If a time and date for your closing has not already been set, please contact our Real Estate Closing Team to schedule your closing by phone at 704-482-7204 or by email at [email protected]. Your closing will take place at our office located at: 211 E. Warren Street, Shelby NC 28150.

If you or any required signer is unable to attend closing, please let us know as soon as possible so that a Special Power of Attorney can be prepared. Your Lender must approve and grant permission to use the document, in advance of the closing. If you already have a recorded Power of Attorney prepared, we will need a copy to be delivered to our office. Please Note: Our firm does charge a fee of $250.00 to prepare a Special Power of Attorney in addition to a $33.00 recording fee; the charges will be added to the settlement statement and collected at closing.

Please bring to closing a valid Driver’s License or other picture identification so that we may properly identify you as the Borrower. We will request your ID upon arrival in order to make a copy for our records. Many documents being signed during the closing are required to be notarized and our Policy is to have a picture ID of any person whose signature will be notarized.

Funds at Closing

Either your Lender or our office will provide you with a Closing Disclosure no later than 3 days prior to closing, provided all necessary information has been given to us to prepare the Settlement Statement or Closing Disclosure. Please be aware that more often than not, we receive a closing package from the Lender immediately before closing. As such, we are not able to provide you with your final numbers until we receive and have an opportunity to process this package. In the event there is a delay on your Lender’s part in delivering the closing package and/or the loan funds to our office, we may have to reschedule your closing. However, our office will do everything we can to ensure that closing occurs at the scheduled date and time.

Once you receive your Closing Disclosure or Settlement Statement you will be provided with the dollar amount of funds needed to close. Please note that you will need to bring those funds with you to closing. Pursuant to State Bar regulations, all amounts due from you at closing must be in the form of certified funds. Please obtain a certified/cashier’s check made payable to “The Schweppe Law Firm, P.A.”.If you wish to wire funds to us, please contact our office for wiring instructions, there is a $50.00 wire service fee that will be added to your total due at closing.BEFORE SENDING ANY WIRE, call our office to verify the instructions. If you receive wiring instructions for a different bank, branch location, account name or account number, they should be presumed to be fraudulent. Do not send any funds and contact our office immediately. Failure to follow this procedure endangers your funds. We highly encourage wires for closing funds that exceed $10,000.00. This will expedite the closing by providing guaranteed and immediate funds.

North Carolina law requires that good funds be received from the Borrower and Lender and that any applicable Loan Documents be recorded at the Register of Deeds Office before any funds can be disbursed. After your documents have been fully executed and approved by your Lender, they are electronically filed by our firm through a secure portal and then processed by the Register of Deeds in the county where the property is located.

Spouse Needed

Please note your spouse will need to execute certain loan documents, regardless if they are a borrower on the loan. If your spouse is not able to attend closing you will need to contact us as soon as possible to have a Special Power of Attorney prepared ahead of time.

If you and your spouse are separated this is not the same as a divorce. If you are separated and are attempting to purchase property independently, you and your spouse must have either a recorded separation agreement stating that your spouse waives their marital rights and interests in the property or a recorded Free Trader Agreement stating same. You must inform your Lender of your marital status and will need to contact us to inform us that a Separation or Free Trader Agreement has been recorded. Failure to do so may result in a delay in your closing.

Our Representation

We represent you in this transactional matter we advise you on legal questions concerning title to your property, title insurance, and the requirements, covenants, and conditions of your loan documents. Our representation ends upon recording and disbursement of funds.

We represent the Lender to the extent of assuring full compliance with its loan closing instructions. The documentation must be completed precisely as required by the loan instructions. Therefore, we may not vary the instructions in such a way that would be either beneficial or negative to your interests. Additionally, if we discovered that you were committing fraud, we may be required to disclose it to the Lender, and we certainly could not continue with the representation. We do not advise you with respect to the terms of your loan agreement with your Lender (i.e., your loan amount, interest rate, conditions for later conversion or refinancing, necessity, or amount of mortgage insurance, etc.). Because of the numerous difficulties that can arise during loan processing, we request that you remain in close contact with your Lender and with our office. Last-minute delays in closing can usually be avoided if you determine in advance what conditions you must meet. Please Note: In the event of a dispute between you and the lender, we will not undertake to represent either party.

Services We Perform

We are responsible for conducting the title examination of the property, ensuring that the loan documents have been properly prepared and executed, that the closing funds are properly received and disbursed pursuant to the Closing Disclosure or Settlement Statement prepared by our office and reviewed by you at closing, that the Deed of Trust (mortgage) is duly recorded, and that the Owner’s and Lender’s policies of title insurance are issued and delivered in proper form. We will obtain payoffs of the outstanding liens, along with cancellation of lien instructions to the proper creditors; however, in the event the creditor does not comply with our cancellation instructions we will not pursue the creditor without being further retained by you to do so.

Title Examination

Our normal protocol is to conduct a full title examination of the property in compliance with the North Carolina Marketable Title Act. This means that we will search the title for a period of no less than thirty years prior to closing. However, if we find an existing policy of title insurance on the property, we will, unless you object, “tack” to that policy. This means that our title examination would begin with the date and time of issuance of that policy and that we will not certify the status of the title to the property prior to that date. While defects in the title occurring prior to the search period would not be reported by us if we “tack,” they would be covered by the existing title policy; you will therefore receive the same title insurance coverage as if we had conducted a full title examination. “Tacking” enables us to conduct the title examination more expeditiously for you, and it will not expose you to any increased liability. Additionally, you are normally entitled to a reduced premium if we are able to “tack” on to an existing title insurance policy. Unless you immediately instruct us otherwise, we will either “tack” or conduct a full title examination at our discretion.

Please Note: A request for title examination will be conducted simultaneous to the receipt of the purchase contract. If your closing fails to close, you may be billed for the title search.

Surveys

Your Lender probably will not require that you have your property surveyed. It is important that you understand the consequences of not ordering a survey. Lenders allow a closing to proceed without a survey because the Lender’s policy of title insurance will offer coverage from loss or damage resulting from a condition which a new survey would have shown. Your Owner’s title policy, issued without a survey having first been performed, will not offer this coverage. This means that any problem which would have been revealed on a survey, such as your fence, driveway or well encroaching onto a neighbor’s property, will become your responsibility and liability. Only a new survey can reveal these problems.

Homeowners Insurance

You should ensure that the any improvements on the property will be insured against fire and other casualties with a reputable company and that the insurance will be in place as of the date and time of closing. You must order the policy. Your Lender will not allow a closing to proceed without it. Ask your insurance company to deliver or send by fax or email the “declarations page” to our office as soon as possible prior to closing. Failure to obtain insurance coverage by the time of closing will result in a delay in your closing.

Other Matters

You will receive copies of your loan documents at closing. If there are additional documents, you would like copies of we are happy to provide them to you at or immediately after closing. The original, signed Lender documents are mailed to your Lender immediately after closing. Per North Carolina Bar rules, we are required to store your file for a period of six years after the closing date. After this time, our firm will destroy your file. Copies of all file documents are stored electronically in our database.

Our Fees

Our attorney fee quote for your real estate transaction is determined based on multiple variables. Our firm’s base fee is $850.00, which may change based on those variables. In addition, there are a number of out-of-pocket charges, depending on your Lender’s requirements, that are passed on to you. Borrower expenses such as the survey fee, termite report fee, title insurance premium, homeowner’s insurance premium, and recording fees, are not included in our legal fee. Please Note: If the transaction fails to close through no fault of our own after the closing documents have been prepared, Borrower will be invoiced based on the amount of work already performed for the transaction.

In limited circumstances there are “leftover” funds after closing that may result from, among other things, document recording expense overages. You are entitled to a refund of such an amount. Due to the administration costs and the complexity of the N.C. Escheat process, by acknowledging below you agree to waive our obligation to return nominal amounts in the aggregate of $10.00 or less. Our obligation to return amounts in the aggregate of more than $10.00 will continue.

Lastly, we understand that this letter contains a lot of information, but we believe that your understanding of the information provided in this letter will lead to a smooth, low stress closing. Please do not hesitate to contact us with any questions or concerns regarding your upcoming closing or questions regarding the information in this letter.

Sincerely,

The Schweppe Law Firm, P.a.