What do I need to know about closing on my home?
Once you’ve signed a contract to buy a house, the preparation for settlement begins. Settlement, or closing escrow, is the process of transferring the title (ownership) of the home from seller to buyer.
Often, the real estate agents involved in the sale help you take care of these arrangements. But the buyer and seller are ultimately responsible for attending to these details.
Here are the basics.
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What are some typical closing costs?
When you apply for a mortgage, the lender must respond with a Good Faith Estimate of Closing Costs, which explains the costs you will likely have to pay at settlement. But the numbers on the form are estimates, and the final tally could be higher or lower.
Some of the more common charges are:
What are some sources for out of pocket cash to pay closing costs?
Sometimes the amount of cash needed to close a sale comes as a shock to the buyer. Taxes, recording fees, insurance premiums, pro-rated interest, escrow deposits and other expenses can easily reach into the thousands of dollars. Rather than reduce the down payment to pay these costs, many homebuyers have other sources of funds they might not think of using.
Here are seven to consider:
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Once a settlement date is set, can it be changed?
Settlement it the last step in home buying – before the moving begins, that is! Sometimes called closing, settlement is where the seller receives the funds from the buyer and the buyer gets proof of ownership. While everyone does their best to meet the settlement date, it is important to remember that many things can crop up to delay the settlement.
Remember, delays in settlement do not necessarily mean the transaction is falling apart. Most transactions do eventually go to settlement. Many problems can be straightened out in a day or so. The key is flexibility.