The Closing Process: What Buyers Need to Do Before Finalizing a Home Purchase
Once the home inspection and appraisal are complete, you’re well on your way to closing on your new home. However, there are still a few important tasks you need to take care of before getting the keys. While it might seem like most of the heavy lifting is done, staying organized and responsive during this final stretch is crucial for a smooth closing. Here's what you should expect as a buyer and what steps you'll need to take.
1. Respond Promptly to Requests
As the closing date approaches, your real estate agent, lender, and title company may request additional documents, signatures, or information to complete the transaction. Responding quickly to these requests is essential to avoid delays. Whether it's signing final loan documents or providing proof of insurance, the sooner you address these tasks, the smoother the process will be.
2. Final Walk-Through of the Property
A few days before closing, you’ll have the opportunity to perform a final walk-through of the home. This isn’t a contingency to the sale but rather a chance to ensure the property is in the same condition as when you made your offer. It's also the time to verify that any agreed-upon repairs have been completed. Be sure to get copies of receipts for repairs done by professional contractors, and check that everything is in order before finalizing the deal.
3. Coordinate Utility Transfers
Before the closing date, contact the utility companies (electric, water, gas, etc.) to set up service in your name as of the closing day. This will ensure that you have uninterrupted service when you move in. It's a good idea to schedule this a few days ahead of time to avoid any hiccups, especially during busy moving seasons.
4. Review Closing Documents
A few days before your scheduled closing, your lender and the title company will provide you with a detailed list of your closing costs, final loan terms, and other documents for review. It’s important to go over these thoroughly so you understand all the financial details, including your down payment, loan terms, and fees. If anything seems unclear, don’t hesitate to ask your real estate agent or lender for clarification.
Closing Day
Closing day is when everything officially comes together, and you take ownership of your new home. The closing process consists of three main steps: signing, funding, and recording.
1. Signing the Documents
Closing usually takes place at the title company, where you’ll meet with your real estate agent, the escrow officer, and potentially your lender. During this meeting, you’ll review and sign several important documents, including:
- The settlement statement, which outlines the financial details of the transaction.
- Your mortgage agreement and loan documents (if applicable).
- Any other legal documents required to complete the transaction.
Be prepared to ask questions and take your time reviewing the paperwork. If you'd prefer to go over the documents in detail ahead of time, you can request them before the signing appointment. The signing process typically takes about an hour for buyers obtaining a loan, while cash buyers can expect it to take around 30 minutes.
2. Funding the Purchase
If you’re financing your home, you’ll need to bring a cashier’s check or wire transfer for your down payment and closing costs to the signing appointment. Your lender will also fund the loan by sending the mortgage funds to the title company. Once all funds are received, the title company will distribute them to the appropriate parties, including the seller and any outstanding debts on the property.
3. Recording the Deed
The final step is recording the deed, which officially transfers ownership from the seller to you. This is done by the title company, and it usually takes place the same day or the day after signing and funding are complete. Once the deed is recorded, the home legally becomes yours. Your real estate agent will then hand over the keys, and you can start planning your move!
Important Notes About Closing Timing
While most closings go smoothly, there can be occasional delays, especially if there are issues with funding or paperwork. To avoid complications, it’s a good idea to schedule your closing for the middle of the week. This way, if there’s a minor delay, it won’t push your move into the weekend.
Congratulations—You’re a Homeowner!
Once the closing is complete and the deed is recorded, you’re officially a homeowner! While the process leading up to closing may have been detailed and complex, it’s all worth it when you finally get the keys to your new home.
If you have any questions or are preparing for closing, feel free to reach out to Tyler Johnson and Live Idaho Realty of Silvercreek Realty Group at 208-890-0640 or send an email. I’m here to help guide you through every step, from making an offer to closing on your dream home!
