Some may be looking to buy their first home and know little about closing on a home. An approved buyer is quite busy leading up to the closing. From arranging a move to changing utilities, finding new medical professionals and more, there are many tasks that will be done in anticipation of moving into a new home.
Avoid potential disappointment and get all affairs in order to have the necessary funds and make arrangements for closing on a home. Planning ahead can make for a smoother home closing process.
The Final Step to a Home Purchase
Closing on a home is the final chapter to buying a home. A lender will be involved if a buyer is financing their purchase. The closing or settlement requires the transferring of funds and an exchange of documents. Payments are made to cover the purchase price which may include:
- Loan proceeds;
- Any designated personal funds; and
- A down payment.
At this point, the buyer will receive the transfer documents, deed to the property and a clear title. The buyer will also get the loan amount, minus fees and initial interest, from their lender. A lien is placed on the property until the mortgage loan is repaid by the buyer. Any respective fees and costs are paid to various parties who helped with the services or documents needed at the closing. Expect to sign many documents at the closing. At the end of the closing, the buyer becomes the new owner of the home.
Location of a Closing
There are different situations that may occur that can affect where a buyer will close on their home with the involved parties. Those who buy a home for cash can decide with the seller on a convenient location. Some may choose to meet at the office on a buyer or seller's attorney. In some states, witness-only closings are permitted. In this situation, an attorney or notary will provide all the documents but will not have to explain them.
Most buyers will be taking out a mortgage. In many cases, the buyer and seller will meet at a settlement agent's office. In some states, parties will close at the office of an escrow company or lender.
Time Needed to Close on a Home
Those working with a lender are subject to their availability. Therefore, it may take longer than initially expected to close on a home. It can take as little as 30 days to close on a home with the majority of federally related mortgage loans. Longer periods may be required for those getting assistance with the down payment from first-time home buyer programs. Missing documents may lead to a delay.
Potential Delays in the Home Closing Process
In the majority of cases, the home closing process is relatively quick. However, issues can arise which can frustrate Murfreesboro new home buyers and sellers. An underwriter may respond in an unusual way to the file submitted to them by the loan officer or request additional documentation. Situations that can cause a delay are:
- Additional debt on an updated credit report of the buyer;
- New liens or judgments against either the seller or buyer;
- Changes to marital status;
- Missing insurance information;
- A review appraisal that fails to match that of the first appraisal; and
- Significant changes to loan estimate fees.
The request for new documents or other information can make it harder to close on a home within an expected timeframe. Speak to a loan officer to learn more about when updates may be necessary and how changes may impact the ability to close on a home.
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