In a nutshell, a real estate closing refers to the very last step in the real estate buying and selling process. Once the seller accepts an offer, a purchase agreement is made. Then, both parties agree on a closing date. It’s on this closing date that the ownership of a particular property is officially transferred from the seller to the buyer.
After completing the real estate closing, the buyer now has the freedom to start the moving in process. They can do as they please with the property. However, as straightforward as that may seem, there’s still a lot more that you should know about what you should expect during a real estate closing.
By knowing what to expect during a real estate closing, you’re sure to enjoy a smoother and more efficient transaction.
1. A Closing Attorney Will Come In Handy
By now you should already have your closing attorney ready. You have to complete and sign many legal documents before the deal is closed. Some of those legal documents might be too complicated for you to understand, especially if this is your first time.
Moreover, having a lawyer on the closing day itself can help smoothen out any potential legal issues. For instance, should you encounter any problems in the paperwork, the real estate legal services in Manhattan that you’re working with will be ready to help out.
2. Your Lender Will Be Watching You Like A Hawk
The days leading to your real estate closing day are crucial. During this time, up until you reach the closing day, expect your lender to be watching you closely like a hawk. Therefore, it’s prudent to know what you shouldn’t be doing to make your real estate closing day as smooth and problem-free as possible.
Some of the don’ts to keep in mind include the following:
- Don’t buy or lease a new car. This isn’t the time for you to add another major loan on top of your current mortgage for the property. Otherwise, your lender might start to doubt your capacity to pay.
- Don’t switch jobs. Even if the job means you’re going to receive a major bump in your salary, don’t do this before and during the closing day. Wait until that deal is sealed so your lender doesn’t have to go through any validation again to make sure that your new job is legitimate.
- Don’t open a new credit card account. Similar to not adding any credit in the form of your car mortgage, now’s not a good time for you to open up a credit card account. You’ll make your lenders want to reassess your debt-to-income ratio.
3. Entering Into An Escrow Is A Must
The escrow process ensures that both the buyer and the seller are well-protected from being ripped off. Remember that you have to deal with a lot of steps and technicalities involved in real estate transactions. If you want to avoid any obstacles as you go through those steps and on the closing day itself, it’s best to have a neutral third party who holds the escrow. That way, your funds and the documents involved in the process stay protected.
4. You’ll Have To Prepare A Lot Of Documents
The real estate closing day is more than just the day when the keys will finally be handed over to you. You should also expect to complete a lot of paperwork for you to say that the deal is closed and successful.
To keep things smooth, make sure to bring with you the original document and copies of the following:
- Funds to cover the down payment, such as a manager’s check or a wire transfer
- Government-issued identification
- Homeowner’s insurance policy
5. Packing Up Your Old Home Is Essential
Another thing that you should have already completed—or you should at least be close to completing—is packing up your old home, especially if the real estate property you’re closing will be your new house. So, if you want to move in ASAP, it pays to have a majority or all of your old home packed.
Once you and the seller have finalized the date for the real estate closing, it’s only natural for the excitement to kick in. After all that hard work and thorough research, you’re now closer than ever to claiming ownership of the property you’re closing. However, like any other process you’ll go through, it’s important to be aware of what goes on during that day. The more you know what to expect, the better. Let the guide above walk you through the expected events during real estate closings.