Buying a Home 101: What are Disbursements?
About to close on a home and the paperwork with your lawyer? Before you complete the process you’ll be asked to pay some “disbursements”. But what are disbursements? Do you have to pay them?
If you are about to close on a new home, no doubt you are very excited. The home-buying process is about to come to its end; all you need to do now is fill out the necessary paperwork and pay the associated fees.
But when you visit your lawyer to fill out the forms, however, you might be in for a surprise. Your lawyer lists out a series of “disbursements” that you must pay in addition to the price of the house and closing fees. What are these disbursements? Is your lawyer trying to pull the wool over your eyes? This article will answer those questions.
What are Disbursements?
First things first: your lawyer is not trying to scam you. Put simply, disbursements are expenses paid by a real estate attorney on a client’s behalf during the home-buying process. At the end of the process, the client is expected to cover those costs.
Disbursements may include:
- Title search fees. It may cost money to retrieve the entire recorded history of the property in question. However, this is an important aspect of the home-buying process, since a title search will uncover any outstanding mortgages or liens on the property.
- Title and mortgage registration fees. The Property Registry charges a fee of $85 for title and/or mortgage registration.
- Building Location Certificate (Survey Certificate) fees. The lawyer may pay to obtain a Survey Certificate that defines the dimensions, position and location of the building and/or land in question. This is an important document, since it can prevent future land ownership disputes, as well as encroachments upon the property.
- Title insurance fees. This is a one-time expense that many banks or mortgage lenders incur at the time of property purchase.
While the above list is by no means exhaustive, it gives you a rough idea of where disbursements fit into the home-buying “picture.” If you have any questions about disbursements, or are looking for an experienced real estate lawyer that can help you with all aspects of buying a home, reach out to us today.
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