WHAT IS THE CLOSING?
The closing is the time when you receive title to the property. It may take place at a title company, lending institution, realtor’s office, or attorney’s office. The lender will normally provide you ahead of time with an accounting of funds that you will need to bring to the closing.
The lending institution may have difficulty in providing you with exact closing figures well in advance. They normally do not prepare the figures until shortly before the closing. Ask the lender for a reliable estimate at the loan application interview. Then add a margin of safety to avoid any possible confusion.
Because the law provides that any contract for the sale or purchase of real estate must be in writing, verbal promises or agreements not included in the contract are unenforceable. It is important to write into the contract all the gray area items such as appliances, window treatments, lighting fixtures, landscaping elements, etc.
Just before the closing you will want to inspect the house again. Personal property which is permanently attached to the house is normally left with the house. The purchase contract should include in itemized list of items which are specifically included or excluded. Check to see that all the items agreed upon in the purchase contract are in place and functional. By law you have a right only to those items specified in the purchase contract.
Remember, you will also need to provide to the lender in advance of closing your homeowner insurance policy, listing it as the loss payee/mortgagee, with a paid-in-full receipt for the policy’s first year premium.
What You Need To Bring
You will need a bank or cashier’s check for the down payment and closing costs made payable to the title company. If the down payment and closing costs are coming from a prior closing, that title company should wire the funds directly to this office’s settlement trust account and we will provide to them wire instructions. Also, the title company and lender will require at least one form of picture identification. A current driver’s license or passport are normally sufficient. On occasion, you may be required to provide two forms, depending on the lender’s requirements.
If you require a current land survey of the property for the purpose of boundary determination or location of buildings, fencing, or driveways, allow sufficient time for review of the completed survey prior to closing.
An attorney or title insurance company can research a title to make sure the property is free and clear of any liens, encumbrances, or taxes. Most title hazards will show up in a title search. This is an examination of public records which covers a preceding period of approximately sixty years.
Even the most thorough search may not discover every title discrepancy. For this reason, title insurance can provide protection for your claim to the property.
Generally, there are two forms of title insurance. Lender’s title insurance, required by most lending institutions, is normally written in the amount of the mortgage and protects the lending institution from losses resulting from title defects.
Because lender’s insurance expires when the mortgage is repaid, you may benefit from the second form of title insurance known as an owner’s title policy. It usually is written for the amount of the purchase price of the home. This protection lasts as long as you or your heirs retain an interest in the property.
Unlike other insurance premiums, your title insurance premium is paid only once, at the closing. By purchasing owner’s and lender’s protection simultaneously, substantial savings in title insurance premiums can be realized.
After all fees have been paid and documents signed and notarized at the closing, you will receive a copy of each and, most importantly, title to your house.