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MESSAGE FROM BROKER/TOC
A. FIND YOUR LENDER
B. FIND YOUR REALTOR
C. FIND YOUR NEW HOME
D. NEGOTIATE YOUR PURCHASE
CONTRACT
E. GET ORGANIZED FOR YOUR
CLOSING
F. CLOSE YOUR DEAL
CLOSE YOUR DEAL
1.
Schedule a Closing Date.
You should communicate with your attorney to select a date that
works for you, the seller, and your lender. The date must be prior
to the closing deadline established by your purchase contract, unless
the seller is willing to agree to a written extension.
2.
Schedule a “Walk Through”. Either on the day
of closing or within a few days prior to the closing, you should
schedule a “walk through”. A final walk-through is worth
your time because it allows you to confirm that agreed upon repairs
(if any) have been made, and that no further damage has occurred
to the house. If repairs have not been made or there is new damage,
the issue will need to be resolved prior to closing.
3.
Study Your Settlement Statement. In advance of the closing,
you should try to obtain a draft settlement statement (sometimes
referred to as a “HUD” or a “HUD-1”, which
refers to the fact that the settlement statement must comply with
the federal Real Estate Settlement Procedures Act, which is regulated
by the Department of Housing and Urban Development). You should
study the settlement statement carefully with both your attorney
and your realtor. Below is an explanation of some common settlement
statement items that are often charged to the purchaser at closing.
Your purchase contract may allocate these costs in several different
ways. Thus, the settlement statement should always be compared to
the purchase contract. Please note that these are generic descriptions
only and you should consult your closing attorney to confirm the
specific purpose of all items listed on your particular settlement
statement.
- Price and Earnest Money.
Don’t forget to verify that the price shown on the settlement
statement is consistent with your purchase contract. If you have
previously deposited earnest money, make sure that you are given
credit for having already paid that amount.
- Tax Prorations. The
settlement statement should allocate annual property taxes in
the manner called for by your purchase contract. Typically, the
parties have agreed to pro-rate taxes as of the day of closing,
with the purchaser being responsible for taxes associated with
the portion of the year from and after the closing date.
- Loan and Loan Costs. The
settlement statement will reflect the amount of your mortgage
loan. It will also detail all costs you have agreed to pay in
connection with your loan such as “points”, loan processing
fees, and the cost of the home appraisal.
- Interim Interest. With
most residential mortgage loans, the borrower is not required
to make any regular loan payments until the first day of the second
month following the closing. However, interest does accrue during
this period and most lenders require that this interest be paid
in advance, at closing.
- Hazard Insurance. Your
lender may require that you pay your insurance company for a full
year of property insurance in advance at the closing. If your
lender will be administering the payment of insurance premiums,
you may also need to make an initial escrow deposit with your
lender for this purpose.
- Private Mortgage Insurance (PMI).
If required for your loan, your lender typically
administers the payment of this insurance. At closing, your lender
may require you to make an initial escrow deposit with them for
this purpose.
- Tax Escrow. If your
lender will be administering the payment of property taxes, then,
at closing, you may need to make an initial escrow deposit with
your lender for this purpose.
- Attorney Fees and Expenses. Your
closing attorney is typically paid at closing. The settlement
statement may also reflect reimbursement of certain expenses to
your closing attorney (e.g. courier fees).
- Title Abstractor’s Fee. Your
attorney may hire a third party (typically referred to as a title
abstractor) to search the title for your property. The abstractor’s
fee is typically paid on the settlement statement.
- Surveyor’s Fee. If
not previous paid, the surveyor’s fee is typically paid
at closing.
- Title Commitment Fee.
Most title agents (in South Carolina, it is common for the purchaser’s
attorney to also act as the title agent) charge a separate fee
to compensate the title agent for their time and expense associated
with preparing a title commitment.
- Title Insurance Premium. This
is the insurance premium charged by the title insurance underwriter.
In South Carolina, it is not uncommon for the closing attorney
(either directly or through a separate title agency) to receive
a portion of this premium as a commission. If this is the case,
the attorney is require to disclose this to you in a written disclosure
document.
- Recording Costs. These
are the fees charged by the government recording office to record
your deed and mortgage. These charges should be distinguished
from transfer taxes (sometimes called “deed stamps”),
which are more often the responsibility of the seller.
4. The
Closing Table. The closing is typically held at the office
of the purchaser’s attorney. In addition to the purchaser
and the seller, it is common for the buyer’s real estate agent,
the seller’s real estate agent, and the purchaser’s
loan officer to also attend the closing. In this setting, documents
are passed around the table for final review and signature. Your
closing attorney should explain the purpose of each document being
signed. Do not hesitate to ask questions if you are unsure of something.
After the documents have been signed, the closing attorney arranges
for the documents to be recorded and for disbursements to be made
to the various parties and vendors, all in accordance with the signed
settlement statement.
5. Move
On In! After the deed is recorded and closing disbursements
are made, you become the legal owner of your new house. If you haven’t
already, you will need to call the phone company, the electric company,
the cable company, and all other utility and service providers to
make sure necessary services are turned on. At last, the long process
is over, and its time to move in and enjoy life in your new home!
We hope you have found this Learning Center
to be helpful. Should you have further questions, don’t hesitate
to call Harbor City for help. Also, be sure to explore some of the
other features that the Harbor City website has to offer, such as:
Harbor City Online Neighborhood Guide
Harbor City Residential MLS Search
Engine
Harbor City Homebuyer Assistance Questionnaire
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