Buying a new home is a tedious task that involves a lot of processes. When it comes to the end of the line though, it will feel like everything has fallen in the right place. Do not let your guards down though, as there might be yet another set of trouble when you are in the process of closing.
Closing is perhaps the final meeting of the buyer and seller wherein the ownership of the house is officially transferred to the former. Together with the buyer and the seller may include their respective attorneys, real estate agents, the loan officer, and the closing agent. This usually takes place at the realty office for about an hour. Settlement of issues, and signing and verification of pertinent documents take place during this time, but what can one really expect from a closing?
To avoid any delay or problem, make sure that all your documents are complete. You might also want to secure a good faith estimate prior to the day of closing, which will advise you on how much money you need to take with you. Also bring your insurance policy and a cashier’s check from certified funds. Personal checks are usually not accepted during such transactions, so prepare all of these. Bring a valid ID photo too pursuant to the Patriot Act.
On signing documents, see to it that you have read everything before you put your name on anything. If you do not understand something or if you have anything in mind, you should feel free to ask. An attorney who has expertise in real estates will prove to be helpful in giving out advice and in protecting your rights as a buyer.
On the matters of cost, you will be incurring other charges if a closing gets delayed, so plan ahead of time and ensure that everything is fine. There are also other costs that amount to around 5% of your total purchase, which may include appraisal fees, attorney fees, document preparation fees, escrow fees, inspection fees, insurance policy payment, interest, loan fees, mortgage insurance, property taxes, recording fees, survey fees, and title insurance.
When everything is agreed upon, especially the numbers, the buyer will bring out his homeowner’s insurance policy and before paying, the closing agent will verify and list all items that the buyer and seller owe each other. The closing statement will then be signed by both the buyer and the seller, where the buyer further signs the mortgage and the seller gives the property title to the buyer. The closing agent will then settle other issues and record all the transactions.
The buyer will then receive different documents such as the sales contract, settlement statement with itemized services and fees, truth-in-lending statement, mortgage note, mortgage or deed of trust, copy of the deed, any required affidavits, and the keys to the new home. Depending on the agreement of both parties and the completion of all requirements, the closing can be a done quickly. It is best to set the closing date by the end of the month to avoid having additional monthly fees with regard to prepay interests on your loan.
Closing is all about knowing your rights and understanding where your money will go. It is a momentous event which opens a new chapter of your life that will be taking place in a new home. So be sure to be ready when this day comes.
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