Frequently Asked Questions Concerning Your Closing
Information About Your ClosingWelcome to the family of clients who have retained our office to represent them in real estate transactions. This memo is designed to answer some of the most commonly asked questions about the procedure involved in buying and selling real property. If you have any further questions after reading this memo, please do not hesitate to consult the attorney handling your matter or their legal assistant.
Will the closing take place exactly on the date indicated in the contract?
Probably not. The contract closing date is usually a "target date". The timing of a particular transaction can be difficult to manage and is often complicated by the fact that the person selling must conclude a closing or be ready to move into the house they are buying. Also, the person who is buying may need the funds from a prior sale. The combination of timing all of these transactions can be very difficult and is often beyond the control of any particular individual, including your attorney. Inquire of the people you are dealing with as to what their timing difficulties might be and advise your attorney as soon as possible.
What is the attorney's role in this transaction?
Your attorney is primarily concerned with the proper transfer of title. It is the purchaser's responsibility to arrange for the financing and to comply with all application and commitment requirements of the lender. Your realtor can refer you to lenders and help you through the mortgage process.
How much will my attorney's fees be?
You will be charged our prevailing fee at the time of closing. Ask our attorney what our current fee is. Also, there may be an increased fee if your closing involves closing by power of attorney, multiple party transactions, occupancy or possession problems, extensive contract revisions or similar difficulties.
How much money will I need/receive at closing?
It is impossible to determine the exact amount to be paid or received at closing until the closing package is received by the closing attorney. Lenders and others who must provide figures to us often do not do so until immediately prior to closing. Your mortgage representative can help you approximate the amount of your closing costs.
What are the Borrower’s responsibilities in this transaction?
You must comply with your lender's requirements and diligently pursue your closing obligations. Be sure to check with your mortgage processor on a regular basis to see how your loan is progressing. Your realtor should arrange for a termite certification if required and home inspection, if desired. Keep us advised of any agreements made between you and the other party as well as any change in your address or telephone number.
Also, always let us know immediately if your loan is granted or denied.
What about homeowners insurance?
The buyer will be responsible for providing homeowners' insurance. It is essential that you arrange for your policy sufficiently far in advance to be assured that it is issued by the time of the closing and that the actual policy, not a binder, is available at the closing. Most lenders require that you have a receipt reflecting that your have paid the full year's premium for the insurance, and further, that they be named in the insurance policy and that its amount be at least equal to the amount of money they are lending to you. Sellers of properties should maintain their insurance until the sale has been concluded.
Purchasers should check with their lender as to exactly how the lender wants its name to appear on the policy. The mortgage commitment usually contains this information. Strict compliance with their requirements is necessary. Some lenders require receipt of the policy several days in advance of closing. Be sure to check, because failure to comply will result in a delay of your closing.
What form of funds is acceptable at closing?
The funds the borrower brings to the closing must be in the form of a (1) certified check or (2) cashier, teller or treasurer check or (3) an official bank check or (3) funds wired to our account. Checks should be made payable to the borrowers, who will endorse them over to the proper parties at closing. If you are depending on the funds from the sale of another home, you should investigate the timing of the availability of these funds and the form in which they are to be made available. If you are selling stocks, most brokerage firm accounts require advance notice of significant withdrawals. Investigate these limitations well in advance and discuss this with your attorney if you contemplate a problem.
How does the closing package get from the lender to the attorney?
Most lenders will email the package to us. Other lenders will send your package by express mail and charge you for this service.
What about exemptions from real estate taxes?
The most common reductions are called homestead exemptions and are made available to homeowners for their primary residence, additional deductions are available for veterans and their widows and to senior citizens and those who are permanently and totally disabled. Check our Resource link for your county’s tax information.
Will I be able to move into my new home immediately upon closing?
Usually. But in some instances, the seller is not able to deliver possession at the closing of title. There are practical reasons. The seller may be purchasing another home, or his mover has not yet removed all of his possession, or he has had to stay in the home until the day of closing and has not yet moved the last of his possessions out. It is up to the purchaser and seller to communicate directly with each other and to work out their own arrangements relating to possession and occupancy, and to advise their attorneys of their agreement.
Must I attend the closing?
As a general rule, lenders require that all parties attend the closing. If there is any possibility that you cannot attend, call our office immediately.
What if something goes wrong with the property after I buy it?
The purchaser ordinarily has the opportunity to inspect the property directly or through professional inspectors and make a reasoned determination as to whether or not to proceed with the purchase. The inspections should be carefully made because, for reasons of public policy, the law does not hold a non-builder seller or real estate responsible for any problems with the house after a closing, in the absence of fraud or misrepresentation.
There are two points at which a purchaser is concerned with the condition of the property: one, at the time of the signing of the contract and the second, at the time of closing. It is strongly recommended that the purchaser walk through the home just shortly before closing to inspect to make sure that there is not change in the condition from the time he inspected the property and entered into his contract. Your realtor will arrange for this "walk-thru" with you and the other parties involved.
What are the Seller's responsibilities?
The Seller should immediately provide counsel with the following documents and information:
WHILE WE HAVE ATTEMPTED TO PROVIDE YOU WITH US MUCH INFORMATION AS POSSIBLE IF YOU HAVE ANY QUESTIONS CONCERNING YOUR TRANSACTION, PLEASE CONTACT OUR OFFICE.