Most people think that either finding the right home to buy or finding a buyer for their home is the hardest part of the home-buying process. However, the closing process can often be just as stressful and confusing. In order to simplify the process, we’ve gone through everything you need to know about the closing process step-by-step.
Buyers should make sure that their home meets their needs before starting the closing process. The home should be in their chosen neighborhood, be large enough for their family, have as many desired design features as possible, and be within the buyer’s price range, even after all of the additional costs.
Buyers should have a home inspector inspect the home for any problems before going through with the closing process. Home inspectors can detect any structural problems, damage caused by termites or other pests, or other problems that may affect the safety and integrity of the home. Buyers should attend the home inspection and read the report created by the inspector, to make sure that they are fully informed of any potential problems of their future home. This is a step that is often skipped, especially if there are lots of people looking at a particular home, but this is an essential step. Skipping a home inspection can put the buyer on the line for extensive and expensive repairs.
Before beginning the closing process, make sure all negotiations are finished. This means that the buyer and the seller should have already agreed on the final price of the home, who pays for what fees, and any deductions the buyer believes should be added due to damage to the property. Make sure that the final dollar amount agreed upon is firm so that there are no surprises for either party on closing day. Nothing shuts down a closing process faster than a surprise change of offer from either party. Buyers should make sure that their offer is competitive, so that they don’t run into losing their bid for a home at the last minute.
Buyers and sellers should be sure to bring any and all important documents with them on the day of closing.
Buyers should bring:
Sellers should bring:
Other documentation will be prepared and signed at the lawyer or real estate agent’s office.
Buyers and sellers should make sure that any lawyers, agents, witnesses, or other necessary people are present at the signing. It’s important that both the buyer and the seller have sufficient representation to make sure that the details of the contract are clear and honored by both parties.
Buyers and sellers should be prepared to run into some obstacles while they are going through the closing process. People may not be able to arrive to the meeting on time, they may suddenly cancel the meeting, or there may be snags in the process of financing the home. All buyers and sellers should plan sufficient time to make sure that they are able to go through the process without rushing and take time to carefully read all contracts and documentation.
Escrow is when a neutral, third party holds onto something valuable until the transaction is finished. When a buyer and a seller go through the closing process, the check that will be used to pay for the home will be held in escrow. This protects both the buyer and the seller while they are in the closing process. The seller cannot leave with the money without handing off the deed, and the buyer cannot leave with the deed without paying. While the details of the contract are being worked out, all buyers and sellers will have to go through the process of escrow.
Closing costs typically make up 3 to 6 percent of the total cost of buying a home. Most of the closing costs are because of taxes related to the sale of the home. Who pays the closing costs associated with the sale should be negotiated as part of the negotiation process of the home. Sometimes, a buyer or seller will offer to pay the other’s closing costs in order to make their offer more competitive or appealing. Buyers should make sure that they include these costs in the sale of the home.
After closing on the home, buyers should make sure that they receive the following documents:
Sellers should receive documentation that documents the sale of their home and financial transactions that were associated with the sale.
Even though the home-buying process can be complicated, the process can be simplified with proper preparation and going through the closing process step-by-step.
For more information about buying homes or to find your dream home, visit McArthur Homes.
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