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How to Prepare for the Closing (Buyer)

01-22-2010
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How to Prepare for the Closing (Buyer)


After making the decision to buy a home, many buyers are surprised by the amount of work that is required for a successful closing. To ensure that you are ready, you may want to develop a checklist of necessary steps with your real estate agent. As you prepare to complete the sale and move into your new home, consider the tips offered here concerning the most important tasks facing homebuyers.

 

  • Estimating / Preparing for Closing Costs: After you have filed your loan application and placed a deposit on the home, your mortgage lender will provide you with an estimate of closing costs. As the amount provided by the mortgage lender is merely an estimate and can change prior to closing, you are allowed to inspect all the loan documents the day before closing. Once you have confirmed the amount, including the remainder of the down payment, you will need to obtain a certified or cashier's check. In most cases, personal checks are not acceptable for payment of closing costs, so work with your agent if you have concerns about the proper methods of payment.

 

  • Planning Your Final Walk-Through: Most real estate professionals recommend performing a final walk-through inspection of the home before finalizing the sale. In most cases, the contract between both parties will include a clause allowing the buyer to inspect the property within the 24 hours prior to closing. At this time, the buyer should make sure the home is vacated, all appliances that the seller agreed to leave in the home are intact and any repairs included in the terms of the sale have been completed. If needed, you can also request that the seller perform a walk-through with you to explain all of the home's details.

 

  • Making Contract Adjustments, If Necessary: For the most part, this final walk-through is the buyer's last opportunity to ensure the terms of the contract are met. If any problems are uncovered during the inspection, you can work with your agent to obtain funds from the seller for repairs or postpone the closing until all repairs are made.

 

  • Securing Homeowner's Insurance: Another requirement of the closing process is the purchase of homeowner's insurance. Required by nearly all mortgage lenders, this insurance protects both homeowner and lender against loss in case of damage to the home. Most homeowner's insurance policies will include personal liability for the buyer – protecting the homeowner in the event of accident or injury on the property – and a combination of coverage against theft, fire, flood and region-specific weather concerns. By working with your real estate agent and mortgage lender, you should be able to find an acceptable policy that meets the requirements of the loan. At the time of closing, you will need to provide proof of insurance to the mortgage lender before finalizing the sale.

 

  • Securing Title Insurance (If Required): In some cases, title insurance may also be required by your mortgage lender. This simple policy protects both the buyer and lender in the event that problems with the title are uncovered after the sale is finalized. If required, both the lender and homeowner need individual title insurance policies, yet these are usually combined into a joint policy to be financed by the buyer.

 

  • Transferring Utility Accounts: Prior to the closing date, the buyer should also transfer all utility accounts from the seller. Besides being a required part of many closing proceedings, this small step will ensure that your new home is ready for move-in after the sale is completed.

 

  • Finalizing the Sale: On closing day, you can expect to sit down with the seller, your agent, your lender and the legal representation required to finalize the sale. 

If you have completed the steps outlined here and arrive with proper documentation, you can expect a smooth closing - and will be well on your way to enjoying life in your new home! 
The staff at Coldwell Banker Real Estate LLC writes select articles about important topics related to real estate. Explore other articles posted to coldwellbanker.com to learn more.

About Coldwell Banker®

Since 1906, the Coldwell Banker® organization has been a premier provider of full-service residential and commercial real estate. Coldwell Banker is the oldest national real estate brand in the United States and today has a network of approximately 83,000 sales agents working in approximately 3,100 offices in 50 countries and territories. The Coldwell Banker brand is known for creating innovative consumer services as recently seen by being the first national real estate brand to create an iPad application and the first to fully harness the power of video in real estate listings, news and information through its Coldwell Banker On LocationSM YouTube channel. The Coldwell Banker system is a leader in specialty markets such as resort, new homes and luxury properties through its Coldwell Banker Previews International® marketing program. Coldwell Banker Real Estate LLC fully supports the principles of the Fair Housing Act and the Equal Opportunity Act. Each office is independently owned and operated.
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