Things To Do Before Closing
Appraisal: The buyer (or the lender) hires an appraiser who visits the home and reviews recent selling process of similar homes in the area (comparable sales). If there are no comparable sales in the immediate area, the appraiser will look at other areas having similar home sales.
Inspection: The buyer hires an experienced inspector who will evaluate the property to determine any problems (structural and cosmetic) that can change the home’s value. The inspection helps the buyer determine items the seller must repair before the final contract is signed.
The inspector will check the home for:
Once an offer has been approved, a title search is conducted. The search is conducted by a licensed Title Company. This step is needed to uncover possible problems with the title on the property.
**A “clear title” to real property is legal ownership.
Possible title problems:
*The insurance guarantees the property is as stated in recorded deeds, surveys, and other documents. The payment for title insurance is a one-time payment and is paid at closing by the Buyer. The vast majority of mortgages require title insurance.
In addition to a home inspector’s report and title insurance, the Buyer can protect himself with Homeowner’s Warranty.
When making the offer, the Buyer should include a clause which states the Seller must provide a limited time warranty which covers repair to the structure, mechanical systems, and major appliances. If the warranty clause is accepted by the Seller, the clause becomes an intercultural part of the offer. The Buyer can purchase his own homeowner’s warranty. A homeowner’s warranty is useful when:
Final Steps to Closing
Three days before closing the mortgage company will provide the Buyer with a Settlement Statement, describing where all the loan funds will be dispersed. As of October 3, 2015, the real estate agent will not be provided a copy of this statement unless the Buyer has agreed to this and informed the mortgage company of such.
Closing costs and down payment are paid by a certified cashier’s check, provided by the Buyer.
Two or three days before closing the Buyer should do a “walk through” of the property to make sure all agreed repairs have been made, and no items from the Buyer’s Agreement have been changed or removed from the house.