10 Steps to Closing

1. Schedule a Closing Date

Make sure to set a closing date as soon as your mortgage loan has been approved and you accept the commitment letter. Your real estate agent will coordinate this date with you, the seller, and the closing agent.

2. Understand Conditions of the Loan Officer

Understand the conditions of the loan offer that are stated in the mortgage lender’s commitment letter. If the seller has agreed to make required repairs, you will need to make sure the repair work is properly finished before closing.

3. Run a Title Search

Mortgage lenders require a title search to ensure you receive a clean title, establish that the seller is the owner of the property, and confirm that there are no liens filed against the property.

4. Purchase Title Insurance

There are two types of title insurance policies: a lender’s policy and an owner’s policy. The lender’s policy protects the lender in the event a flaw in the title is detected after the property has been purchased. The owner’s policy protects the buyer. Purchasing a combined lender’s-owner’s policy could save you money.

4. Purchase Title Insurance

There are two types of title insurance policies: a lender’s policy and an owner’s policy. The lender’s policy protects the lender in the event a flaw in the title is detected after the property has been purchased. The owner’s policy protects the buyer. Purchasing a combined lender’s-owner’s policy could save you money.

5. Request a Termite Certificate

When buying a home, a termite inspection may be required. The seller usually covers the cost of this inspection. Once completed, the homebuyer receives a certificate stating the property is free of termites and termite damage.

6. Purchase Homeowner’s Insurance

Homeowner’s insurance helps protect you and the mortgage lender from loss in the event the house is damaged or destroyed. If you do obtain insurance on your own, bring the insurance policy and paid receipt with you to the closing.

7. Homeowner’s Warranty

A homeowner’s warranty protects against certain defects in your home. If buying an older home, or if you are a first-time buyer, you may want to be covered for repairs of major systems like plumbing, heating and air conditioning.

8. Final Walk-Through Inspection

Make sure that your contract allows you to examine the property within 24 hours prior to closing. During the walk-through, if you find major problems or violations of the purchase contract, you have the right to hold up the settlement until issues are fixed.

9. House Tour With Seller

It is always a good idea to tour the house with the seller either before or shortly after the closing. Ask for the names and phone numbers of contractors, electricians, plumbers, roofers, and carpenters who have worked on the house. Ask for copies of operating and instruction manuals for appliances, and security systems.

10. Final Estimate of Closing Costs

The mortgage lender is required to give an estimate of closing costs soon after the loan application has been filed. Usually, you will be required to pay the remainder of the down payment at this time. Make sure you understand the acceptable forms of payment.