Buying a new home in New York is an exciting time in your life. But before you move into your new place, you must complete the closing process. Whether you’re a new buyer or are reentering the housing market, it’s good to know the ins and outs of closing on a home. With that in mind, here are the main steps in the house closing process.
Getting a clean title
One of the most important steps in the real estate closing process involves a property’s title. Completing a title search lets a potential buyer know that no one else has any legal rights to the property they want to buy.
Having a professional inspection completed
Before the contract is signed it is also important to have a professional inspect a property you’re interested in. This inspection helps ensure there are no hidden issues with the home you want to purchase.
Taking care of closing costs
Another important thing to take care of involves paying closing costs. These are expenses that you typically pay to a lender. A lender charges closing costs to cover expenses like home appraisals, flood certification and credit search fees, origination fees and the lender’s attorneys’ fees. Additionally, purchasers set up real estate tax and homeowner’s insurance escrow accounts and have to “fund” them at closing. Sometimes, closing costs can shock inexperienced buyers. So, make sure you have an accurate estimate of what your closing costs will be. Lenders are required to provide estimates along the way but they are often not finalized until the day or two before the closing. Be aware that the lender will “net fund” the closing proceeds, i.e. it will deduct from the mortgage amount the fees and costs payable to it, so the actual proceeds will be less than the amount of the loan. The purchaser will have to make up that difference.
Completing lots of paperwork
Whether you enjoy it or not, most closing processes require completing lots of paperwork. Completing this paperwork involves quite a bit of reading and understanding potentially complex terms.
In conclusion, there are several important steps you’ll need to complete before closing on a home. Completing these steps can cost a fair amount of both time and money. However, knocking out each step in the home closing process will give you immense peace of mind as a buyer.
