The State of Ohio is experiencing a surge in the real estate market, as the median home price has risen about 5% over the national average. In Ohio, the average home costs about $250,000. Most sellers will be pleased to see that within two to three months of listing, their homes have sold and almost always within 5% of the listed selling price. In many areas of the country, assessments are skewed. This leads to inflated home pricing in comparison with actual home values. Ohio residents are fortunate, in that they are not experiencing this trend.
This is great news for both buyers and sellers in the state, who definitely want to make the most out of a market that is currently performing very well. The number of home sales in the state has dropped sharply over the last decade, however this trend is likely to reverse as economic conditions across the country begin to improve and industry begins to expand even further within the state.
Where to Live in Ohio
The major cities of Columbus, Cleveland, Cincinnati and Akron are the most highly populated and the most popular places to live within the state. Much like the rest of the country, the majority of Ohio housing is single family homes. Around 65% of the homes are owned, with about 22% being rental housing. This trend is most common in the major metro areas, as most rural areas feature few options for renters.
Depending on your lifestyle, there is a city in Ohio that will meet your needs. The majority of major cities in the state are experiencing tremendous growth and offer residents a good opportunity to strike a balance between their professional and home lives. All of the cities are experiencing tremendous economic growth and there are jobs available across the state in any number of industries.
Security Deeds and What They Mean to Ohio Residents
In the state of Ohio, mortgage lenders are protected with security deeds. The state is a recourse state, meaning that if a lender chooses to foreclose and the sale of the home does not get enough to satisfy the debt entirely, the lender has the option to sure the borrower for the remaining balance. The remaining balance is known as a security deed also and the lender must utilize a judicial method to obtain a judgement against a borrower for the balance due.
This means that the process of foreclosure takes longer in Ohio than in neighboring states. It also means that borrowers experiencing financial difficulties will find their lenders much more amicable to making payment arrangements.
The Ohio Foreclosure Process
As with the information above, Ohio lenders opting to foreclose are required to utilize a judicial foreclosure process in order to retain access to the property in question. There are multiple steps in the process.
- A lender who is intending to foreclose will perform a title search through a title company to find out who is listed on the title of the home. If there are multiple borrowers, but only one person is named on the title according to this search, it is only the named title-holder who will be involved in the foreclosure.
- Second, the lender files a lawsuit through the courts to begin the foreclosure process. The complaint is filed with the county clerk where the property is located. The borrower is notified officially by the court once the lawsuit is filed. If there are any other lien holders, they will be notified of the intent to foreclose as well. This is called a lis pendens and if issued, there may be future problems with any sale involving the property in question.
- Third, there is a waiting period before a default judgement will be issued. Once the judgement is issued, there will be a public notice about the intended sale of the home. This will generally appear in a local newspaper weekly for 3-4 weeks.
During the process, the borrower has the option to redeem the mortgage at any point by paying the back payments and all applicable fees and costs to the lender. This will immediately halt the foreclosure process, no matter when it happens. Until there is a court order to sell the property, the borrower retains this right.
Right of Redemption After the Sale of a Property
Borrowers whose homes have been sold through the foreclosure process have the ability to regain ownership of the home for a specific period of time after the property has been sold by paying off the entire loan in certified funds plus any costs and interest involved. In Ohio, the redemption period lasts for three months.
A Lender has the right to file for a deficiency judgement if the sale of the property is not sufficient to pay off the loan balance and satisfy the debt. A judgement can be issued against the borrower for the remaining balance due on the mortgage after the sale and their other assets can be sold in response in the same way that their home was. Some lenders do not seek deficiency judgments and will instead seek a default judgement only. The process of getting a deficiency judgement can take a year or more if the borrower or anyone else contests the judgement.
Refinancing Laws in the State of Ohio
Between 1988 and 2007, there were a number of laws passed regarding the refinancing of mortgages within the State of Ohio. The most important change to the lending industry is that lenders are no longer permitted to charge borrowers a prepayment fee if they opt to refinance. This only applies to borrowers who have been in their homes for a minimum of five years. While not every lender chooses to charge these penalties, they have the right to do so under Ohio law.
The earliest of the refinance laws to go into effect in 1988 ruled that lenders cannot charge more than 8% over the current prevailing rate of 90 day treasury bonds. This applies to adjustable rate mortgage loans and mortgages that have less than $100,000 in remaining principal.
Other Real Estate Laws in Ohio
Military personnel and their spouses cannot be charged an interest rate over 6% in the state. The maximum amount for mortgage related charges and fees is 6% of the total loan. This was passed as an effort to end predatory lending practices within the state that saw lenders looking for borrowers with bad credit and charging them outrageous fees and costs.
Before the mortgage is finalized, Ohio borrowers are required to receive several different disclosure and mortgage related forms. One is called a Closing Disclosure. It is a document containing a list of all associated costs. There is a consumer warning built in to this form that states that if the borrower was previously quoted different costs, they are not required to accept the new agreement. Lenders are being held responsible for sticking to their story when it comes to low fees and costs. The second information sheet is called
Ohio Homebuyers’ Protection Act Informational Document. Once they receive this document, the borrower needs to sign a paper stating that they were given the information.