ARE YOU READY TO CLOSE?
While the tip of the mountain seems so far away, this simple checklist will help ease the way…
Review the Commitment Letter – Review and accept the conditions in the lender’s commitment letter. Make sure all conditions have been met before closing.
Set the Closing Date – An estimated closing date is normally specified in the sales contract. After your mortgage loan is approved and the commitment letter is accepted, a firm closing date will be set.
Select Closing Agent/Attorney – The loan closing is a legal transaction, so you may want to use a real estate attorney early in the process. You will need a closing or “settlement” agent to coordinate closing activities. Usually the closing is conducted by title companies, escrow agents or attorneys. A title search is required to prevent any issues with your property. Lenders want to be sure that the seller is the owner of the property. The title search may uncover liens that you weren’t aware of. Title insurance assures the buyer that the seller is giving “marketable title.” A lender’s policy protects the lender in the event a flaw in the title is detected after the property has been purchased. An owner’s policy protects the buyer but is optional in Florida. However, obtaining a combined lender’s/owner’s policy could save you some money, especially in the long run if a defect is found.
Survey – The lender may require a survey of the property to confirm that the boundaries are accurate.
Termite Inspection – Homes should be inspected for termites before closing. I have watched many television shows where they pull of the sheetrock and find tens of thousands of dollars in termite damage. This could have been avoided. Getting a certificate from a termite inspection firm that the property is free of both visible termite infestation and termite damage is worthwhile.
Homeowner’s Insurance – Your lender will require that you purchase insurance to protect your property. This is called hazard/windstorm insurance and protects from loss in the event the house is damaged or destroyed. If your property is in a flood zone, you will also be required to purchase flood insurance. Coverage must be equal to at least the replacement costs of the property. Lenders typically want the first year’s premium to be paid at or before closing.
Well and Septic Certifications – If your property is not served by public utilities, you will need local government certification of the private water source and sanitary sewer facility before closing. The county government performs the certification but the buyer must arrange same.
Certificate of Occupancy – Before closing on your newly built home, ensure that the certificate of occupancy has been issued so that you can actually move into your home.
Walk-Through Inspection – A lot can happen to your house is 30 days. You should examine the property within 48 hours prior to closing. Your real estate sales professional usually will accompany you on the walk-through. This is your opportunity to make sure that everything looks as agreed. Make sure you check the lights, appliances, and plumbing fixtures are in working order. If you observe major problems, you can postpone closing until the issues are rectified.
Everything looks good – you are good for closing!
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