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Today's Mortgage Rates in Delaware

Today’s mortgage and refinance rates plus current home buying and refinance advice for Delaware residents

Buying a home in Delaware

Seller’s disclosures are an essential aspect of purchasing a home anywhere, but in Delaware there are some very precise disclosure laws. The state has a comprehensive document that consists of over 130 questions, and every seller in Delaware is required to complete it before the home can even be listed on the open market. So, what does the disclosure cover? Actually, quite a lot.
  • Deed restrictions
  • Homeowners or condo association regulations and rules
  • Zoning information
  • Environmental hazards
  • Property damage
  • Weather damage
Then there are structural items, including:
  • Termite infestations or damage
  • The condition of the basement, crawl spaces, attics, and roofs
  • Details about plumbing and electrical systems
  • The condition of all systems and appliances that are to be included in the sale
But … it is totally the responsibility of the buyer to get a thorough home inspection of the property, if there are any worries at all. The main thing to remember about buying a home in Delaware is that everything needs to be written into the contract — or an addendum to the contract — that will be signed by both the buyer and seller before proceeding to complete the purchase of the property. So make sure you know what contingencies you’re going to need before you or your agent write your offer. And, write into the offer whether your ability to purchase depends on financing or satisfactory home inspection.

Refinancing a home in Delaware

Delaware is one of those states that likes light-touch regulation. If you and a lender reach a deal, it doesn’t want to interfere. However, there is one legal aspect of refinancing in Delaware that can trip up borrowers. Luckily, it only applies to those who have current second mortgages, such as home equity loans and home equity lines of credit (HELOC). And it involves the "doctrine of equitable subrogation," which isn’t as hard to understand as it sounds. When you borrowed your original mortgage, it took "first lien" status. A lien is a legal charge, which means the lender can foreclose if you default. And the lender with the first lien can recover its costs before other lenders can. If you have a second mortgage, it takes second lien position and any others third and so on. Each gets to recover its costs only after those higher on the list have had theirs. When you refinance, your new lender almost inevitably will demand first lien status. But that’s not how the law works, at least by default. It’s first come, first served: the most recent lender takes bottom position in the lien list. And you may really struggle to refinance if this affects you. Unlike those in some other states, the Delaware supreme court takes the view that you’re on your own, if you face these circumstances [Eastern Savings Bank, FSB v. CACH, LLC, CA No. N13A-09-008 (Sept. 28, 2015)] Luckily, it often doesn’t apply. Many lenders of second mortgages recognize the problem and voluntarily allow the refinancing company to take the first lien spot. But not all do. The real lesson here is for homeowners in Delaware only to apply for second mortgages that allow the new lender to take top spot. If that advice comes too late for you, you can try appealing to the better nature of your second-mortgage lender, which may place its loan in second position as an act of good customer service.

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