Your offer has been accepted... So, now what? Part III (Settlement Attorneys)

3.  You've made it through the inspection, financing is chugging along smoothly... You're on your way! So, now what? It's time to choose a settlement company.  In Maryland and DC the buyer gets to choose the settlement attorney- though keep in mind the settlement attorney will end up working for both the buyer AND seller (no taking sides here!).   Their job is to insure the successful transfer of title from seller to purchaser. 

Settlement takes place on or before (as long as it is mutually agreed to) the date identified on the contract.  Small note:  4 parties need to agree on the settlement time (buyer, seller, and both agents)- so start talking timing early, before calendars get filled up. 

Sometimes there is a financial incentive to use one settlement attorney over another (typically because your chosen lender has a deal going with a specific attorney).  The discount can be substantial and is usually found as a reduction to title insurance fees.  (Note:  for short sales, foreclosures and the like, sometimes the ability of a "specialty" settlement attorney will far outstrip the savings found at another.  I've learned this the hard way).  Be sure to ask your lender if they have such a deal in place.  If there is no affiliation your real estate agent will gladly offer up some competent suggestions. 

Most, but not all, settlement companies will have a website where you can easily figure out your settlement costs (I like to suggest that you do this prior to placing an offer... just so that there aren't any surprises!  As a buyer, one should allow for between 2-3% of the purchase price).  And, if they don't, they'll be very glad to provide you with an estimate. 

Important:  be on the look-out either via e-mail or snail mail for a packet/questionnaire from the settlement company (both seller and buyer).  It's important to respond promptly to their questions so that the title work can proceed in a timely manner. 

A day or two before your scheduled settlement you will be given a preliminary HUD-1.  The final HUD-1 won't be available until the day of when the banks finalize their numbers.  The HUD-1 will give you a very good estimate of the money you are to bring to the table, (in the form of a cashier's check, or a wire), or the money you will receive as a seller.  It also breaks down all of the costs involved in the purchase or sale.  It can be a little confusing to understand, so if you have any questions ahead of time, fire away. 

Last thing.  Don't forget to bring some i.d. with you (drivers license or passport), and a checkbook (to make up for miscalculations in the preliminary HUD-1). 

Part I of "Your offer has been accepted... So, now what?"  tackles home inspections and how they might play out in your home purchase scenario. Part II discusses Financing and what to expect.

Coming soon... Be on the lookout for "Your offer has been accepted... So, now what? Part IV" which will discuss title insurance.