7 ms·

I the first time I closed on a house, realizing ten minutes in that either I was going to be signing contracts without reading them, or everyone was going to be

by techdmn 14y ago

I the first time I closed on a house, realizing ten minutes in that either I was going to be signing contracts without reading them, or everyone was going to be sitting around watching me read for three hours. There's a lot of pressure in a situation like that, even though I try never to sign anything without reading it.

roc 14y ago
Sadly enough, professional negotiators regularly leverage social pressure on people who don't negotiate professionally. It's effective precisely because you don't expect it to be used as a weapon against you.
lesterbuck 14y ago
I sat through some classes on how title companies worked, and the closer (the person at the title company who manages the entire process) refers to you as a "reader." Somewhat unusual, but not that uncommon. (I was a reader when I bought my house years ago.) RESPA requires that all significant costs be listed on a sheet available 24 hours before closing, and you can press your rights on that, though it may delay your closing by one day. That gives you the time to read all the documents before everyone collects in person. And everyone does not need to be in the same room at the same time, of course. Closing documents may be FEDEXed around the world, if necessary, and some real estate investing dual closings (flips) very much depend on everyone NOT seeing all the documents.
jedberg 14y ago
That's why I asked them to send me the documents ahead of time. I spent the night before signing reading all the documents. They said I was the first person to ever ask. :/
jrs235 14y ago
Yup. When I closed on my home I had to figure out to handle that too. It blows the minds of the people in the room away if you sit there and read over the thing... and then ask questions for clarifications. It also [sometimes can] pisses them off cause they plan on 15 to 30 minutes for closing... so if you take your time and go over it ask questions it throws their whole schedule off. When I refinanced the credit union was smart enough to send copies of what I would be signing ahead of time so I could read over it and ask any questions prior to the ceremony of signing it in front of the notary public.
- habitatforus 14y ago
  Ask for the documents in advance. Tell the title agency that if you don't get copies in advance you'll happily sit in the room and read them all at closing. Call them a few times to remind them that your are "Really looking forward to reading every word of those contracts". They want deals to close smoothly and will provide you with the documents.
japhyr 14y ago
I took my time during the only closing I've been part of. Every time I worked with my bank, I'd find some small but meaningful mistake in the paperwork. So I didn't trust that closing documents would all be correct. The funny thing is, nobody seemed to mind because they seemed amused to have someone finally reading through the paperwork and asking interesting questions.
praptak 14y ago
I usually ask beforehand for a copy of anything I'm expected to sign. If the other party refuses, I have no qualms with sitting, reading and inquiring as long as necessary.
Xylakant 14y ago
In germany for certain contracts (such as buying a house or creating a LLC) it's required that a notary reads them aloud for you. That's quite a bit of fun if the contract contains annotations that make it fill a binder. There are some loopholes though: The contract may refer to another document that the notary may read to his assistant, so not everybody has to go through the whole ordeal.
- speleding 14y ago
  Yeah we have that too in the Netherlands, at least for the important portions of the documents. The last time I closed on a house it took over two hours. All relevant documents had been e-mailed to us beforehand but you still cannot ask them to skip the reading. Being too careful can be annoying too.
  - lobo_tuerto 14y ago
    I'd take annoying over being effed up anytime. You can't ever be too cautious in legal matters.
  - dalke 14y ago
    Idle curiosity makes me wonder if this applies when the purchaser is deaf. I'm going to predict the answer is "yes."
- SoftwareMaven 14y ago
  Seems like that could leave a nice side effect of shortening contracts.
  - slowpoke 14y ago
    In Germany, the stronghold of bureaucracy? You wish.
- Spoom 14y ago
  I recently closed on a house in Ohio. At closing, the notary verbally summarized every contract we signed. I'm not sure if it was legally required (I believe he stated it was) but I also took the time to read them. Most of them were copies of contracts I had already signed with the realtor / mortgage company at offer / mortgage application, so nothing was particularly surprising. Further, at offer time, the realtor read aloud every contract and answered questions we had about them. I don't feel that they tried to pull the wool over my eyes at any point. Perhaps it's different with other realtors?
spolsky 14y ago
Did you have a lawyer to represent you? That's their job... to make sure that the contract you're signing is OK. Actually reading a contract without knowledge of the law, case history, and background can get you into just as much trouble as not reading it at all. That's why you have lawyers review important contracts.
- gisikw 14y ago
  Having your lawyer read something is no excuse for not also reading it yourself.
  - jakejake 14y ago
    If course we're supposed to read it but in some situations it's not realistic. Buying a house involves hundreds of pages. Unless you're a lawyer, the average person isn't going to recognize loopholes in the contracts. And I don't know many people who would back out on a house sale at that stage, so it's highly unlikely you'd refuse to sign. The only practical way to do that is to get an advance copy of everything. In these cases you really do need a lawyer who you trust has read the documents and is protecting you.
    - johnnyg 14y ago
      I read each and every page before I purchased my home. I highlighted everything I didn't understand. Most pages looked like bumble bees. I worked questions during a 5 hour session with my realtor. For terms I now understood but didn't agree with, I had two options depending on the type of term it was: 1. Government and HOA stuff was not changing. I could accept it or walk. 2. Seller stuff could change. We made some minor requests and largely got them. Reasoning: We were spending 6 figures. The quality of my work would have a major impact on my family for a long time to come. I was newly married and this was my first family related big project. I was damn sure going to understand how interest rates and loans work ("whats a point?", "fixed vs float") and what legal junk we might be getting into. I got a chance to learn a little about real estate. When life throws you a stack of legal documents, make lemonade. I also got to vet out the agent. I work hard and have had some business success. I figured one day it would be time for another house and it would be nice to have a long term relationship with a trusted realtor on that one too. Core point: it is your name on the document, it is a lot of money, it impacts your feature. Exactly how lazy are you to not read it?
hluska 14y ago
I subscribe to the 'when you're in a bank, read everything, even if it takes four hours' theory. The last time I set up a really simple business chequing account, the account manager: - spelled my name wrong - spelled the company name wrong - claimed that I was an electrician - listed my job title as 'oner' None of these are terribly material errors, but they demonstrate just how frequently errors occur in financial documents. Frankly, it makes me queasy to imagine all the errors that could pop up in a mortgage document...
- yaix 14y ago
  And you still opened an account at that same bank?!
  - mahyarm 14y ago
    Those retail bankers are like store clerks, not paid that well.
- plink 14y ago
  "listed my job title as 'oner'" An obvious construction error. Just as one who plays piano isn't called a "pianoer", the account manager must have meant "onanist". Did you finally strike him in the face with your gloves?
lobster45 14y ago
When we closed our house we not only read through the entire stack of mortgage papers, we had a several hour session where the escrow representative went line by line and explained everything to us. It is always good to understand what you are signing, especially a 30 year mortgage contract. However many of the statements we signed very worded in a way that a lawyer can interpret it in any way so the liability falls on us!
nradov 14y ago
By all means read the documents that are actually contracts. But those are only a few pages. The rest of the documents you have to sign when closing a real estate purchase are mostly boilerplate disclosures about mold, asbestos, flood zones, penalties for fraud, etc ad nauseum. Anything that's actually important in the disclosures you'll already know about if you did your pre-purchase investigation properly. So there's no point in wasting time reading those disclosures in detail during the closing.
ars 14y ago
Just let them know in advance, they'll either send them to you before, or schedule time for you to read them while they are doing other things.
WalterBright 14y ago
Since it's big money that I would be on the hook for, you bet I make them wait while I read the contract front to back. Yes, it annoys the escrow officer, but too bad.

by techdmn 14y ago

roc 14y ago

Sadly enough, professional negotiators regularly leverage social pressure on people who don't negotiate professionally. It's effective precisely because you don't expect it to be used as a weapon against you.

lesterbuck 14y ago

I sat through some classes on how title companies worked, and the closer (the person at the title company who manages the entire process) refers to you as a "reader." Somewhat unusual, but not that uncommon. (I was a reader when I bought my house years ago.) RESPA requires that all significant costs be listed on a sheet available 24 hours before closing, and you can press your rights on that, though it may delay your closing by one day. That gives you the time to read all the documents before everyone collects in person. And everyone does not need to be in the same room at the same time, of course. Closing documents may be FEDEXed around the world, if necessary, and some real estate investing dual closings (flips) very much depend on everyone NOT seeing all the documents.

jedberg 14y ago

That's why I asked them to send me the documents ahead of time. I spent the night before signing reading all the documents. They said I was the first person to ever ask. :/

jrs235 14y ago

Yup. When I closed on my home I had to figure out to handle that too. It blows the minds of the people in the room away if you sit there and read over the thing... and then ask questions for clarifications. It also [sometimes can] pisses them off cause they plan on 15 to 30 minutes for closing... so if you take your time and go over it ask questions it throws their whole schedule off. When I refinanced the credit union was smart enough to send copies of what I would be signing ahead of time so I could read over it and ask any questions prior to the ceremony of signing it in front of the notary public.

habitatforus 14y ago
Ask for the documents in advance. Tell the title agency that if you don't get copies in advance you'll happily sit in the room and read them all at closing. Call them a few times to remind them that your are "Really looking forward to reading every word of those contracts". They want deals to close smoothly and will provide you with the documents.

japhyr 14y ago

I took my time during the only closing I've been part of. Every time I worked with my bank, I'd find some small but meaningful mistake in the paperwork. So I didn't trust that closing documents would all be correct. The funny thing is, nobody seemed to mind because they seemed amused to have someone finally reading through the paperwork and asking interesting questions.

praptak 14y ago

I usually ask beforehand for a copy of anything I'm expected to sign. If the other party refuses, I have no qualms with sitting, reading and inquiring as long as necessary.

Xylakant 14y ago

In germany for certain contracts (such as buying a house or creating a LLC) it's required that a notary reads them aloud for you. That's quite a bit of fun if the contract contains annotations that make it fill a binder. There are some loopholes though: The contract may refer to another document that the notary may read to his assistant, so not everybody has to go through the whole ordeal.

speleding 14y ago
Yeah we have that too in the Netherlands, at least for the important portions of the documents. The last time I closed on a house it took over two hours. All relevant documents had been e-mailed to us beforehand but you still cannot ask them to skip the reading. Being too careful can be annoying too.
- lobo_tuerto 14y ago
  I'd take annoying over being effed up anytime. You can't ever be too cautious in legal matters.
- dalke 14y ago
  Idle curiosity makes me wonder if this applies when the purchaser is deaf. I'm going to predict the answer is "yes."
SoftwareMaven 14y ago
Seems like that could leave a nice side effect of shortening contracts.
- slowpoke 14y ago
  In Germany, the stronghold of bureaucracy? You wish.
Spoom 14y ago
I recently closed on a house in Ohio. At closing, the notary verbally summarized every contract we signed. I'm not sure if it was legally required (I believe he stated it was) but I also took the time to read them. Most of them were copies of contracts I had already signed with the realtor / mortgage company at offer / mortgage application, so nothing was particularly surprising. Further, at offer time, the realtor read aloud every contract and answered questions we had about them. I don't feel that they tried to pull the wool over my eyes at any point. Perhaps it's different with other realtors?

spolsky 14y ago

Did you have a lawyer to represent you? That's their job... to make sure that the contract you're signing is OK. Actually reading a contract without knowledge of the law, case history, and background can get you into just as much trouble as not reading it at all. That's why you have lawyers review important contracts.

gisikw 14y ago
Having your lawyer read something is no excuse for not also reading it yourself.
- jakejake 14y ago
  If course we're supposed to read it but in some situations it's not realistic. Buying a house involves hundreds of pages. Unless you're a lawyer, the average person isn't going to recognize loopholes in the contracts. And I don't know many people who would back out on a house sale at that stage, so it's highly unlikely you'd refuse to sign. The only practical way to do that is to get an advance copy of everything. In these cases you really do need a lawyer who you trust has read the documents and is protecting you.
  - johnnyg 14y ago
    I read each and every page before I purchased my home. I highlighted everything I didn't understand. Most pages looked like bumble bees. I worked questions during a 5 hour session with my realtor. For terms I now understood but didn't agree with, I had two options depending on the type of term it was: 1. Government and HOA stuff was not changing. I could accept it or walk. 2. Seller stuff could change. We made some minor requests and largely got them. Reasoning: We were spending 6 figures. The quality of my work would have a major impact on my family for a long time to come. I was newly married and this was my first family related big project. I was damn sure going to understand how interest rates and loans work ("whats a point?", "fixed vs float") and what legal junk we might be getting into. I got a chance to learn a little about real estate. When life throws you a stack of legal documents, make lemonade. I also got to vet out the agent. I work hard and have had some business success. I figured one day it would be time for another house and it would be nice to have a long term relationship with a trusted realtor on that one too. Core point: it is your name on the document, it is a lot of money, it impacts your feature. Exactly how lazy are you to not read it?

hluska 14y ago

I subscribe to the 'when you're in a bank, read everything, even if it takes four hours' theory. The last time I set up a really simple business chequing account, the account manager: - spelled my name wrong - spelled the company name wrong - claimed that I was an electrician - listed my job title as 'oner' None of these are terribly material errors, but they demonstrate just how frequently errors occur in financial documents. Frankly, it makes me queasy to imagine all the errors that could pop up in a mortgage document...

yaix 14y ago
And you still opened an account at that same bank?!
- mahyarm 14y ago
  Those retail bankers are like store clerks, not paid that well.
plink 14y ago
"listed my job title as 'oner'" An obvious construction error. Just as one who plays piano isn't called a "pianoer", the account manager must have meant "onanist". Did you finally strike him in the face with your gloves?

lobster45 14y ago

When we closed our house we not only read through the entire stack of mortgage papers, we had a several hour session where the escrow representative went line by line and explained everything to us. It is always good to understand what you are signing, especially a 30 year mortgage contract. However many of the statements we signed very worded in a way that a lawyer can interpret it in any way so the liability falls on us!

nradov 14y ago

By all means read the documents that are actually contracts. But those are only a few pages. The rest of the documents you have to sign when closing a real estate purchase are mostly boilerplate disclosures about mold, asbestos, flood zones, penalties for fraud, etc ad nauseum. Anything that's actually important in the disclosures you'll already know about if you did your pre-purchase investigation properly. So there's no point in wasting time reading those disclosures in detail during the closing.

ars 14y ago

Just let them know in advance, they'll either send them to you before, or schedule time for you to read them while they are doing other things.

WalterBright 14y ago

Since it's big money that I would be on the hook for, you bet I make them wait while I read the contract front to back. Yes, it annoys the escrow officer, but too bad.