What To Expect At Closing Of House – You’ve accepted an offer on your home, signed a contract of sale, and are now waiting to close. Congratulations! But there’s still a to-do list before closing: when the sale is official and when you hand over the keys to the house for the check.
Home closings typically take between 30 and 60 days, depending on the buyer’s or seller’s loan type, financing and preferences. A home sale closed within 30 days means that no offer is derailed during the inspection and the buyer has no financial problems.
What To Expect At Closing Of House
Here’s what happens in the home closing process for sellers in the month or two between accepting an offer and signing the documents formalizing the sale.
The Closing Process → Pioneer Title Co
A down payment is a cash deposit that a buyer pays to show that they are serious about buying your home. It’s usually 1 to 3 percent of the home’s sales price, and the buyer puts it into a holding account called escrow. Serious money is applied to the buyer’s share of the down payment or closing costs at the end of the deal.
Underwriting is the sausage part of a mortgage approval. This is when the lender checks the buyer’s income, assets, debt and loan size as necessary to determine if the buyer is a good credit risk.
The buyer’s agent will order a review of public records, called a title search, to make sure you are the legal owner of the property and can sell it. Think of it as a home background check.
The buyer hires an expert to make sure there are no problems that could affect the property’s value or security. Not all buyers require a check deposit, but it is a common step in the closing process. Some sellers choose to complete a pre-inspection, allowing the buyer to skip this step. Sellers generally do not participate in buyer verification.
How To Negotiate Your Mortgage Closing Costs
The lender hires an expert to make sure the buyer is worth the amount loaned to purchase the property. An appraiser estimates a home’s fair market value based on its features and the prices of comparable homes that have recently sold in the neighborhood. A lower rating may delay the deadline.
Usually 24 hours before closing, the buyer and their agent will make a final inspection to make sure the home is clean, intact and cleared of your belongings.
It’s official closing day! Give the house to the new owner and get your money. Ka-ching.
The final step of selling your home only takes about an hour, but you need to be prepared. Don’t forget to mention the closing date, time and place. Missing the finale is like missing your wedding: Not going to any shows is a deal breaker.
First Time Home Buyers
Be sure to bring a government-issued photo ID, house keys, depositor or any paperwork your attorney may need, and a checkbook.
You may have signed fewer legal documents as a buyer as you squeezed your hands to initialize each page on a four-inch-thick piece of paper. Your signature responsibility will be limited to the Closing Declaration, Title Deed, Deed and Sale Deed. Read everything carefully before signing. Make sure the information is 100% accurate.
As a seller, you can expect to pay 8% to 10% of the home’s sale price in closing costs. Closing costs vary by location and the terms of your contract.
If you’re just starting your seller journey, remember that your agent can help keep you on track during the closing process. Find an experienced agent who can help you overcome potential obstacles and cross the finish line. Perhaps the most common question we get is how to calculate real estate closing costs when buying or selling a home in North Carolina. This is especially true for sellers deciding how to respond to an offer and for buyers figuring out how much cash they need at closing. In this article, we’ll discuss common NC closing costs for buyers and sellers, how to calculate them, and ways to avoid or minimize some closing costs.
Buying A Home
If a buyer buys a mortgage, the buyer’s bank or mortgage lender will pay a number of fees at closing. The most expensive is the origination fee, which is usually 0.5-1.0% of the loan amount.
The application fee may also include the flood certification fee, tax service fee and appraisal fee (unless the appraisal is paid outside the deadline).
Less regular payments are called discount points. In this case, the buyer puts in extra money to “buy” the interest rate. A lump sum payment at closing will save you a few dollars each month over the life of the loan because the interest rate will be lower.
It is important to understand that interest rates may not differ between different lenders, especially if you are evaluating similar loan products from different banks. You can really shop around for the best deal by comparing closing costs. Some lenders charge little or no application fees or even waive certain fees. Pay attention to loan origination fees and application fees. These rates are usually the most negotiated rates. If you’re looking for a mortgage lender, contact us for a list of our favorite lenders in the Asheville area.
What To Expect On Closing Day When Buying A Home
Mortgage lenders typically require the borrower/buyer to put an amount in an escrow account to be used for future property tax and homeowner’s insurance payments. That’s money you have to spend anyway, but in this case it’s collected up front at the end. Lender requires 2 to 8 months deposit to be paid at closing.
Initial security deposits for homeowner insurance are usually added to the initial homeowner’s insurance premium. At closing your down payment will be paid to the insurance company and the escrow deposit will be the basis for your new escrow account with your mortgage company.
In North Carolina, we use real estate attorneys to close real estate transactions, while many other states use title companies. A real estate attorney will look for ownership history, request an insurance policy and review the lender’s mortgage documents for closing. The costs of conducting the closing and inspecting the title are usually paid by the buyer.
Title insurance protects the buyer and lender against defects in the title. It is a one-time premium paid at the time of closing, so the buyer has no future premium payments. Estimate this cost to be $2-$3 per $1,000 in sales price. If the sale is a cash sale, the lender does not need a title policy, so the cost is lower.
What To Expect After Closing Escrow: Realtor Edition
At closing, a new deed (and a new power of attorney in the case of a finance sale) is recorded in the Land Registry at the County Courthouse. Any document submitted to the district requires a registration fee. These fees are very low. As of the date of this article, Buncombe County charges $26 to record a deed and $64 to record a deed of trust.
Property taxes are calculated from the closing date. The same applies to association fees if the property is subject to a homeowners association. To learn more about how to calculate property taxes in the Asheville area, read our post on Asheville property taxes.
North Carolina imposes an excise tax on every sale of real estate. This fee is also known as “Revenue Stamp”. The calculation is $2 per $1,000 in sales price. So a house that sells for $350,000 is subject to $700 in income tax.
In most cases, real estate agent commissions are paid by the seller out of the seller’s proceeds. There are exceptions to this, but as a general rule, the seller pays this fee. The real estate commission is determined in the listing agreement between the seller and the listed company.
How To Watch The Closing Ceremony
As with the buyer’s closing costs, sellers are responsible for their pro rata share of taxes and association fees (if applicable). This may result in a credit return to the seller.
Sellers should also expect commission costs such as wiring (sending the mortgage payment to the lender and their proceeds to the seller). This is usually a modest fee of around $30-$50 per wire transfer.
Sometimes the sales contract states that the seller will provide a home warranty. This is also payable at the time of closing. Most home warranties are around $500-$600, but this can vary by system.