Congratulations! A seller has accepted your offer. Before you can take possession of your new home, however, several important details must fall into place. Count on The Honeywill Team to explain each step in the process and answer your questions.
While each transaction is unique, the most important steps include:
Complete a Home Inspection
Assuming this contingency was in your offer, schedule a thorough inspection of the property with a qualified home inspector. If you like, the Service Providers link on this website can help you identify several inspectors to choose from. The inspector should provide you with a written report detailing any flaws found in the home, including information about the severity of his or her findings. If severe problems are found, your contingency clause will permit you to cancel the contract without obligation. The Buyer may request any inspection they feel is necessary and pay for those inspections.
The seller is entitled to copies of inspections, upon request.
Alternatively, you may want to negotiate performance and payment for any significant repairs noted in the inspection. But also remember that no home is perfect and small repairs and maintenance issues should not derail the transaction or require another round of negotiations.
Select a Closing/Settlement Company
The closing company is responsible for coordinating and verifying all documentation needed to close. All parties to the transaction, including buyers, sellers, lenders, agents, appraisers, etc. submit needed documentation to the closing company. They also verify clean title and provide title insurance for the lender and the buyer.
The Mortgage & Appraisal
Securing a mortgage can be more complex and expensive than many consumers realize. Numerous documents and details must come together in a short period of time. Make sure you have promptly supplied your lender with everything they ask for so your financing is in place for closing day.
Get Ready to Move
Moving may be the biggest job you face in buying a home. Be sure to get a jump on these preparations. First, decide how much help you’ll need. If you plan to hire a moving company, compare costs and make a reservation.
Other important details include coordinating dates to end service with all utilities and establish service in your new home. Make sure the post office has been notified of your change in address, as well as your bank, credit card companies, insurance agent, attorney, other key professionals, and family and friends.
Pre-Closing Walk-through
A pre-closing walk-through is a final check to ensure that the home is in the same condition it was during the inspection and to make sure all contracted items, such as appliances, are still in the home. Buyers are entitled to two walk-throughs, one within 5 days of closing and the other the day of closing.
Prepare to Pay Closing Costs
When you applied for your mortgage, you received a good-faith estimate of closing costs. As closing approaches, you’ll receive a Closing Disclosure, outlining exactly how much money you will be expected to bring to closing and what forms of payment are acceptable.
Frequently Asked Questions About Closing
What is Closing?
Closing (also called settlement) is the legal transfer of property ownership. Usually, but not always, possession is transferred at closing. Sometimes the seller may ask to close the sale but retain possession, and pay rent to the buyer until vacating the property at a later date.
Who Attends Closings?
Face-to-face closings are common in Pennsylvania. The participants usually include:
- You, the buyer.
- The seller.
- The real estate agents representing the buyer and seller.
- Attorneys for the buyer and seller are optional in Pennsylvania.
- The closing agent, the title insurance representative, and the escrow agent. Often one person fulfills all three roles, coordinating and recording the exchange of the documents and money, disbursing funds, and handling various closing details.
Where is Closing Held?
Closings are usually held at the Buyers broker office by the Buyers title company.
What Do I Need to Bring?
The Honeywill Team will advise you on what you’ll need to bring to closing, but typically buyers must provide:
- Certified funds for Payment of closing and mortgage costs.
- Photo Identification
- Your personal check book for any miscellaneous items that may come up at closing.
What Happens at Closing?
You’ll sign many documents. Rely on the closing officer to review these documents and answer any questions you may have. Frequently-used documents include:
Closing statement (HUD-1 or ALTA) — details all funds changing hands between the buyer and seller
Truth in Lending statement — a final summary of the terms of your loan
Mortgage note — a legal obligation to repay the lender according to stated terms
Deed of trust — the legal transfer of ownership; gives the lender a claim against your home if you fail to meet the terms of the mortgage note
Affidavits — any binding statements by the buyer or seller
Riders — any contract amendments that impact your rights
Any additional documents required by your Lender.
Once all documents are signed and all monies have been paid, possession is transferred and you receive the keys to your new home. Be sure to keep your closing documents in a safe place for future reference. Some of the expenses associated with your home purchase are tax-deductible.
