With historically low-interest rates, 2017 is shaping up to be a great year to buy a house. The real estate closing process is the final step in the lengthy home buying process. By this point, you most likely have signed a purchase contract, completed a home inspection, negotiated the price and terms of the deal, and conducted a title search via a real estate attorney or title agent. Whether you’re a first-time buyer, or buying your final dream home, this article should provide tips and tricks for how to be prepared to close.
Preparation is Key
If you are reading this article, you likely are already preparing yourself for closing and will be ready to go when the time comes. State law can differ dramatically on real estate law. For instance, some states refer to your bank’s interest in your home as a mortgage, while other states refer to the document as a deed of trust. While these two terms achieve the same function – allowing your bank to take a secured interest in the property in the event you cannot make payments – they can have slight differences that can leave a big impact.
In preparation for closing, you should also make sure you have read all documents beforehand. It’s very tempting to sign an assortment of documents at closing without reading a word of text. Avoid this temptation. By asking for and reviewing the documents ahead of time, you know exactly what it is you are signing. Further, you have an opportunity to catch mistakes that would have interrupted the closing process or would not have been caught. While most real estate professionals are very good at what they do, mistakes do happen. Unfortunately, a wrong name on a deed can cause headaches down the road. By reading through the documents carefully, you add an extra layer of security and peace of mind.
Along with preparation comes communication. By preparing for you closing, and communicating with the other parties, the closing process should be much smoother. Communication should take place not only with your real estate agent, but also potentially with the seller, the real estate agents, and the attorney or title agent closing your home. When you have a question or don’t understand what something means, slow the process down and ask. By taking the time to address potential problems early on, you can alleviate future stress and miscommunication. You should also have clear communication from your real estate agent or attorney on what documents you should bring to the closing.
Have Your Financial House in Order
Your new home isn’t the only thing that needs to be in order by closing day. At this point in time, you will have already been approved by the bank for your loan. Make sure that all loan documents are in order that nothing material has changed in your financial picture. If you are the buyer, be prepared to bring a certified check to the closing. While it may be possible to wire the money, must closing agents prefer to work with a check. If some alternate form of payment is accepted, the closing agent should let you know. Along with the purchase price of the property, the buyer may also be expected to reimburse the seller for taxes, etc.
If you are one of the millions of Americans who will be moving this year, we hope this article provided a little insight into the closing process. Through careful preparation and communication, you can help make the closing process better for everyone.
Morris Lilienthal is a shareholder with the personal injury law firm Martinson & Beason, P.C. He is AV rated by Martindale-Hubbell and has received the Alabama Super Lawyer Rising Star award. In addition to car accidents, he also assists clients with wrongful death, nursing home negligence, and products liability cases.