Stephanie Payab's Blog
When you close on a home, you’re sealing the deal with all of the agreements that you have made with the seller and your lender over the course of the home buying process. Since most people don’t pay cash for a home, your loan will also close at the same time as the ownership changes. If you are paying cash, the process may be slightly different. Closings can also be called “settlements” since everything is being signed and sealed at this time, essentially, “settling” the deal.
Have Your Checkbook Ready
The closing is where documents are exchanged, the keys are passed on, and all of the funds required to complete the transaction are paid. Closing costs include the down payment that you’re putting on the home, lawyer’s fees, taxes, commissions, assessments, and more. The seller may be writing a check too, paying off the old loan to their former home. You’ll need to verify the amount that needs to be paid at closing clearly before you reach the closing table. The money must be presented at the time of closing in order for the deed to be handed over.
Get A File Folder And Stretch Your Writing Hand
The settlement on a home requires quite a bit of paperwork. You’ll be handed a stack of papers to sign. Take the time to listen to your lawyer or realtor to understand exactly what you’re signing. There’s more papers to sign than you really can imagine! Finally, you’ll be handed copies of all the papers that you put your signature on. It’s important to keep everything for your records. These documents will include everything from proof of insurance to the deed on the property to your loan terms and documentation.
Where Will The Closing Be?
Depending on where you live, your closing will take place in either the lender’s office or the office of a lawyer who is representing the closing. Typically, it will be the loan company’s attorney who holds the event in this case. In some cases, closings can be what is known as “witness only.” This means that a notary or attorney will be present at the chosen closing location to provide documents. The drawback to this type of transaction is that nothing that you’re signing will be explained to you.
What Happens Following Closing?
When all the I’s are dotted and the T’s are crossed, congratulations! You’re the proud owner of a new property. Unless there has been a prior agreement made with the seller, you’ll be able to take possession of the property right away. Occasionally, there will be some post-closing agreements that involve transactions due to a repair that couldn’t be made or reimbursements for real estate property taxes that were paid on the part of the seller. Ideally, this will all be taken care of at the closing table, but at times other arrangements must be made.
After you submit an offer on a home and complete a property inspection, there may be only a short amount of time until you close.
Ultimately, it pays to prepare for closing day. If you start planning for your home closing today, you can identify and address any potential problems.
To better understand how to get ready for a home closing, let's take a look at three questions to consider before your closing.
1. What needs to get done before my closing date?
Your closing date may be a few weeks away, but time moves quickly, particularly for a homebuyer who wants to get into a new residence as quickly as possible. Fortunately, homebuyers who understand what needs to get done prior to a closing can plan accordingly.
Typically, a homebuyer will need to secure homeowners insurance and title insurance before closing on a house. Insurance companies are available to provide information about both types of insurance. If you reach out to these companies immediately, you can guarantee that your home and personal belongings will be covered against loss or damage.
You'll need to contact utilities providers as well. That way, you can ensure that your gas, electric and other utilities are good to go as soon as you close on your home.
2. How much are my monthly mortgage payments?
You know that you've been pre-approved for a mortgage. However, if you don't know how much that you'll be paying for your home each month, you'll certainly want to find out sooner rather than later.
Monthly mortgage payments can add up quickly, particularly for homebuyers who fail to budget properly. If you know exactly how much that you'll be paying each month for your home, you can effectively map out a budget.
3. What do I need to bring to my closing?
Homebuyers are required to bring a government-issued ID to a closing. In some instances, you may need to provide a certified or cashier's check to cover assorted closing costs as well.
If you are unsure about what to bring to a home closing, it often helps to consult with a real estate agent. In fact, this housing market professional can help you seamlessly navigate all stages of the homebuying cycle.
Prior to a home closing, a real estate agent is happy to respond to any concerns or questions that you may have. This housing market professional will explain how the home closing process works, how long the process generally takes to complete and, perhaps most important, when you'll receive the keys to your house.
A real estate agent also goes above and beyond the call of duty to provide assistance throughout the homebuying journey. He or she can help you compare and contrast a broad range of houses, submit a competitive offer on a home and ensure that you can discover your dream residence in no time at all.
Get ready for a home closing – consider the aforementioned questions, and you can prep for your closing date.
The weeks and days leading up to a home closing can be stressful, particularly for a homebuyer who is already trying to do everything possible to secure his or her dream residence. Fortunately, we're here to help you simplify the process of getting to your closing date.
Now, let's take a look at three tips to ensure you can enjoy a fast, easy home closing.
1. Get Your Paperwork Ready
It often helps to get all of your homebuying paperwork ready before you pursue a residence. That way, you can minimize the last-minute stress associated with searching far and wide for pay stubs, tax returns and other documents that you'll ultimately need to get financing for a residence.
Furthermore, you should meet with local banks and credit unions as soon as you can. If you can get approved for a mortgage prior to starting a home search, you may be able to speed up the process of acquiring your ideal residence.
2. Be Prepared to Cover Your Closing Costs
Although you might have financing to cover your monthly mortgage payments, it is important to remember that you may need to pay closing costs to finalize your home purchase. As such, if you begin saving for your closing costs today, you can guarantee that you'll have the necessary funds available to purchase your dream residence on your scheduled closing date.
Also, you should be prepared to present a cashier's check or wire funds when you close on a house. If you plan ahead, you should have no paying off your closing costs when your complete your home purchase.
3. Schedule Your Final Walk-Through Before Your Closing Date
When it comes to a final walk-through on your dream house, why should you leave anything to chance? Instead, set up the final walk-through at least a few days before you're scheduled to close on a house.
If you find problems with a house during a final walk-through, you'll want to give the seller plenty of time to address these issues. Thus, if you schedule a final walk-through several days before your closing date, you can ensure that any home problems can be corrected without putting your closing date in danger.
For homebuyers who are worried about a home closing, there is no need to stress. In fact, if you work with an expert real estate agent, you can receive plenty of support throughout the homebuying journey.
Typically, a real estate agent can explain what you should expect in the time leading up to your closing date. If you have any concerns or questions before a home closing, a real estate agent is happy to address them. Plus, when your closing date arrives, a real estate agent will help you remain calm, cool and collected as you purchase a home.
Ready to streamline the process of closing on a house? Use the aforementioned tips, and you can reap the benefits of a quick, seamless home closing.
When you’re buying a home, there’s a lot to think about. Your finances probably have the biggest impact in the entire home search process. The amount of a down payment you have and the amount of loan you’re approved for help decide what you can buy.
When you hear about closing costs, what do they entail? How much will you need to cover these costs? Many people get to the closing table for their home purchase and feel unprepared. You’ll need a certain amount of cash on hand when you finally close on a home. Learn more about closing costs, so that you understand everything that you need to know about your home purchase.
Closing costs are spelled out pretty plainly in just about every kind of real estate contract. These costs are the fees associated with the title companies, attorney, banks, lenders and everyone else who is involved in the purchase of a home. The closing table is also the time when you provide your sizable down payment. The closing costs that are being referred to are considered a separate expense independent of the closing costs.
Closing Costs Vary
Closing costs can range from anywhere between 2 and 8 percent of the purchase price of the home. You can’t really “choose” what’s included in the closing, so you’ll need to have an idea of how much money you’ll need to write a check for. Lenders can give you an estimate of about how much closing costs will be.
Certain things like the realtor’s commission fees can be negotiated and can be paid for by the buyer or the seller. The good news is that you can roll your closing fees in with your mortgage in some cases. You may also be able to negotiate with your lender to pay the closing costs for you in exchange for a higher interest rate.
What’s Included In Closing Costs?
Depending upon where and what type of home you’re buying, what the closing costs actually cover varies. Here’s just some of the things that closing costs cover:
- Escrow fees
- Credit reports
- Title search
- Title exam fee
- Survey fee
- Courier fee (Most transactions are done electronically, but in some cases this may be necessary)
- Title insurance
- Owner’s title insurance
- Natural hazards disclosure
- Homeowner’s insurance (Your first year of insurance is often paid at closing)
- Buyer’s attorney fee
- Lender’s attorney fee
- Transfer taxes
- Recording fees
- Processing fees
- Underwriting fee
- Pre-paid interest
- Pest inspections
- Homeowner's association transfer fees
- Special assessments
These fees vary widely by state and the type of property that you’re purchasing. Not every fee is required, but the above is just a list of many of the possible fees that could be included in on the closing of the home you choose.