What Happens During Closing
This is the time to be in touch with the lender to provide whatever is necessary for the final loan documents, for the seller to take care of any requested repairs, and for the lender to go through the underwriting process
As a buyer, you will want to arrange for the utilities to be turned on when the seller’s is turned off on the day of closing. Don’t forget to have the phone and cable company ready to turn on your new service as well. Make sure all magazines, bills, and family and friends, have your new address! You can get a Moving Package from the local Post Office to help with this. Anything related to school registration should also be done well in advance at the new school where your children will be going. Moving preparations should be made as soon as you know the offer is approved. Check out my Moving page for tips and help.
Just Before Closing:
Re-Inspect the Property . Besides the paper work, which you must review and verify at closing, you should re-inspect the property once again just prior to closing. Is everything the way you expect it to be? Have all the necessary repairs or other corrective work been done that were promised to you? This is important so that you don't arrive at your new house and find unexpected surprises. The most important thing to remember is that before closing you want to be certain that all the conditions of the purchase contract have been met. You want to be sure that all directions given to the closing agent have been performed.
At the Closing!
The closing is almost always done at the title company (an exception could be an out-of-state or out-of-country buyer, in which case documents are over night mailed and need to be notarized). Buyer and seller close at the title company separately, and the keys are not given to the buyer until the recordation, which may be that afternoon for a cash transaction, or the next evening for loans. The recordation, which is the recording of the deed, is considered the actual "closing", so time your movers accordingly.
Buyers (and sellers) and their agents will be given an audit sheet (the settlement sheet or HUD-1 Statement ) showing the closing costs beforehand, so there are no surprises, and the buyer will know exactly how much his cashiers check should be. You should go over all the calculations and be certain that you are given credit for all your deposits and any other credits due to you from the seller or for other items agreed upon between buyer and seller. Go over all the lender and title and escrow fees, to be sure they are what you had been told and that you agree to them.
Your loan officer will have gone over the final closing costs involved with the closing as well just prior to closing.
Other closing costs will consist of the title company’s processing fee (escrow settlement fee), recording of the deed, pre-paid interest*, homeowner’s insurance, homeowner’s insurance impounds, property tax impounds, and a notary fee.
Prepaid interest - Since mortgage loans are due on the first day of the month, and properties can close any day of the month, the interest will be prorated and paid at this time.
Homeowner’s insurance premium is paid at the closing. However, since the mortgage company will be paying the continuing payments, it will divide the annual premium by twelve to get an estimated monthly amount and hold 2 months in your impound account.
The same is true of the property tax. Property taxes are prorated at the closing and the buyer is responsible for the taxes from the closing date on, which may start based on the closing date, and therefore prorating gives the seller any prepaid tax refund. Taxes are divided by twelve and 2 months is held in your impound account.
Once the paperwork is signed, the loan documents are sent back to the lender if a mortgage is involved. The lender makes sure that their instructions were carried out and they have all of the signed documents that they need. When this happens, the lender will wire the funds to the Escrow Officer -- this is the event everyone has been waiting for. The Escrow Officer then has the Deed recorded at the County Recorder's Office. As soon as this is done you get your keys and the moneys are disbursed. In the case of new construction, you generally get to pick your keys up from the builder after recording has been confirmed. Although this varies.
And on to our next "step!" There is one
more thing. Your moving experience!
What You Can Learn From Your New Home Walk through Orientation
the most from your new home orientation can take some planning and
What Are These Loan Documents, Which I Received In The Mail? You may be concerned that sometime during your property purchase, you may receive documents in the mail from your lender. These documents may be separate from your note and mortgage or deed of trust documents.
IRS Publication 530, Tax Information for First Time Homeowners An IRS publication, which outlines the deductible expenses or owning a home. Explains what expenses you can deduct as a homeowner, and points out expenses which you cannot deduct.
Ron Kimball "A Internet Realtor"