Getting to Know the Process of Closing - Home Buyer

Getting to Know the Process of Closing - Home Buyer Basics

After your well-prepared purchase offer has been accepted by the seller, you would probably want to learn when the transaction will close. Let's say for instance that you've been looking at Buffalo Grove homes for sale. When you make an offer on a Buffalo real estate and the seller agrees to it, you'll probably wonder what happens next. The one who'll determine how much time it would take to process the loan and close is your lender, unless you'll pay the house in full. It doesn't matter if you and the seller have come to an agreement on when the closing date is, if the lender isn't able to perform on the date you set. The rule is: the transaction will be closed when the lender is set to close.

Depending on where you are located, any number of bodies can manage the closing process. The closing agent may be any one of the following: a real estate lawyer, an escrow officer, a closer, or a title company.

The closing process can vary, depending on the state. All terms and conditions of the purchase agreement must be met before an escrow can be closed. Then, the buyer will deposit the money and the seller will deposit the deed. Some examples of conditions that must be met include the following, which may differ in various states:

- Fully accomplish the purchase contract and addendums

- Deposit down payment

- Get a home inspection

- Seller should fulfill obligations like submission of roof certification, pest inspection completion report, preliminary title policy, home warranty, and the like

- Make the final walk-through inspection

- Complete buyer inspections, which include release of contingencies, if ordered

- Appraise property by the appraiser of the lender

- Lender should provide loan approval and the buyer must satisfy loan conditions like depositing of proof of homeowners insurance policy

- Buyer and seller should sign escrow instructions

- Seller should sign and notarize deed conveying title

- Buyer must sign and notarize executed promissory note and deed of trust

- Buyer should sign all loan documents

- Buyer's funds should be deposited from the lender

- The balance of the buyer's down payment and closing costs must be deposited

There are certain situations wherein closing is delayed or even prevented. The following are some of the most common causes of this problem:

- More debt discovered on the updated credit report of the buyer

- Low appraisal or a review appraisal ordered by the underwriter that doesn't match the previous appraisal

- Errors in the buyer's credit report

- New judgments or liens filed against the seller or the buyer upon the title update

- Clouds on title

- The change of marital status of the seller or buyer

- Requirement of updated financial documents or bank statements

- Missing insurance information

- Expired program or loan commitment

Understanding the closing part of the process of buying real estate is very important, as it can aid you in preparing for whatever obstacles that might run into.

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