The ten basic steps of purchasing a home - Closing the Transaction
Now that you have done the hard work of examining your finances, finding your Realtor who you connect with, secured an approval for mortgage financing, found a home that you want, made an offer that was accepted, finalized attorney review, purchased homeowner's insurance and have in hand a comprehensive home inspection report, you are almost ready for the closing. It is extremely important that you make no large purchases until after you have closed on your new home. If seeking a mortgage, a final credit check will be done within 24 hours of the scheduled appointment.
The day prior to closing, a final walk-through of the house should be done. This final inspection gives you the opportunity to be sure the seller has moved out and completed any repairs agreed upon in the sales contract or as a result of a home inspection report. During the walk-through, make sure that all systems (for example, heating and cooling) are working properly and any appliances or other items the seller agreed to leave behind are in the house; in good working order and the house is "broom " clean.
Be sure to get a get a good sleep the night before the big day. You will be dealing with a lot of legal and financial documents. For those also selling a property in order to purchase, you will have a double dose of closings. At this stage of the home buying process you will sign all mortgage documents and any other paperwork needed to complete the transaction. Essentially, it's the final transfer of money and keys. When you walk out of your lawyer's or agent's office, you will own a new home.
With the exception of privately financed purchases, in almost all cases your lender will require you to purchase title insurance, which protects you and the lender up to the purchase price of the property in the event that title to the property is found to be faulty. This is a one-time fee paid at closing. If you are privately financing the purchase, you may consider purchasing title insurance to protect yourself from claims against prior owners.
The deed and the mortgage that you receive must be recorded in order to establish your clear title to the property. This is usually done by the title agent or your attorney. Be sure that these arrangements are made and completed as soon as possible after the closing. Request that a copy be provided to you.
In New Jersey, most closings, are done in a face-to-face meeting of the buyer, the seller, the real estate agents, the lawyers, the title clerk and the representative from the mortgage company. As the buyer, you have the right to select a settlement provider who will aid in the closing of the transaction.
In some cases, you may save money by shopping for a settlement agent, which can be your lender, a title insurance company, your real estate broker or attorney or an escrow company. In central and northern New Jersey, your closing will likely take place at the office of your attorney.
For more information consult your attorney or the New Jersey Department of Banking and Insurance - (609) 292-7272 or 1-800-446-7467
If you have additional questions or comments, please contact me here, by phone or email, on facebook and/or twitter. Next, Understanding the Settlement Statement.
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