What “TO DO” From Making The Offer To Closing
FINDING THE PERFECT HOME
Prior to beginning your search, review your finances to determine how much you can comfortably afford to pay each month for your mortgage payment, real estate taxes and homeowners insurance. Also consider whether you will be making a down payment and how much closing costs will be.
SELLER’S DISCLOSURE STATEMENT
The Seller must complete a Seller’s Disclosure Statement. This form answers questions regarding the condition of the home. Carefully review the Seller’s Disclosure Statement before making an offer.
Once you have found the home, make an offer by presenting a Sales Agreement to the Seller. Always submit the offer in writing. The Sales Agreement should address the following items: sales price, hand money, personal property included in the sale, inspections, and contingencies regarding the sale of buyer’s current home, delayed possession, closing cost credits (also known as seller’s assist).
Always make your offer contingent on a Home Inspection, Termite/Pest Inspection and Radon Test.
APPLY FOR A LOAN
When selecting a lender and choosing a loan type, consider the following:
- Down payment;
- Taking out a 2nd loan vs. paying Primary Mortgage Insurance
- Interest rate
- Term of the loan
- Type of loan (fixed or adjustable interest rate)
- Lender’s Fees (when shopping around for a Lender, compare Annual Percentage Rates)
- Whether you want to escrow your taxes and homeowners insurance
- Special Programs – First Time Home Buyer Programs, Veteran’s Programs
- Closing Costs
The Lender will require an Appraisal to be conducted to confirm that the house is valued at or above the loan amount.
Upon approval, request a mortgage commitment letter from the Lender and forward to the Seller.
SELECT A TITLE/SETTLEMENT AGENT
As the Buyer, you are entitled to select who you would like to act as the Title/Settlement Agent. These Agents are also referred to as Closing Agents. The Closing Agent will work with your Lender to prepare for the closing. Specifically, they will perform a title search, order tax certifications and no lien letters (identifying whether there are any taxes owed or municipal liens against the property), issue the title insurance (insuring that the property is free and clear of any liens and is being transferred to you without any title or ownership problems), prepare the deed, the HUD-1 (listing all the closing costs) and other closing documents, disburse funds, and record the deed, mortgage, etc. Essentially, the Closing Agent should make the process as easy as possible for you. They are responsible for preparing for the closing, conducting the closing, and making sure that all items are paid for and recorded after the closing.
Prior to the closing, you will need to obtain one year of Homeowners Insurance (also referred to as Hazard Insurance). Proof this must be faxed to the Closing Agent. You can either pay the policy before the closing or it can be included in your closing costs and the Closing Agent will submit payment immediately after.
A week before the closing call and arrange for the date for the utilities to be turned on (unless you do not plan on moving in right away). Note: You may need to put a deposit down for some of the utilities.
You will receive the Final HUD-1 a day or two before the closing. The HUD-1 lists all of your closing costs. It also states the amount of money that you must bring to the closing.
Bring a certified check made payable to you for the specified amount. You will sign it over to the Closing Agent at the closing.
FINAL WALK THROUGH
A day or two before the closing, do a final walk through of the house.
REMEMBER DRIVER’S LICENSE/CERTIFIED CHECK
Remember to bring your driver’s license and the certified check with you to the closing.
GET THE FOLLOWING FROM SELLERS AT CLOSING
All spare keys, garage door openers, all security codes, and copies of all warranties that the Sellers may have [examples include: windows, appliances, garage door openers, furnace, air conditioner, hot water tank, roof].
Save all of the documents regarding this purchase. You will receive a copy of the Original Recorded Deed approximately one month after the Closing.
UNPACK AND ENJOY YOUR NEW HOME!
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