From
the buyer's perspective the closing can be divided up
into three activities:
1. Reviewing and signing of loan documents.
These can include mortgage, note, affidavits, Truth in
Lending statements, estimate of closing costs, escrow
statement letter, which outline how much will be paid
in to the real estate taxes and insurance escrows.
2. Exchange of documents between the buyer, seller
and the title or escrow company.
The buyer and seller must sign specific documents related
to the transaction and the tilt company representative
may need to sign some of these too. The buyer will be
presented with documents form the seller for review and
verification that they are correct. These include:
- The deed
- The bill of sale
- The affidavits of title
- Documentation required by the contract such as radon
or lead
- inspections
- Insurance certificate
- Property survey
- Condo assessment full payment cert
- Co-op assessment full payment cert
The tile company will require that any documents related
to the purchase or sale of a home for the Internal Revenue
Service to be signed. They will also require any documents
related to the title to be signed at this time including
the following:
- RESPA HUD-1 statement, which is really a detailed
explanation of who paid what and how much. This is
signed by the buyer, seller and title company representative.
The RESPA HUD-1 Statement outlines who pays what on
everything from pro rations on taxes and assessments
for Condos and co-ops to loan charges related to items
payable in connection to the title to government charges
for the transaction. This is a document you need to
keep in your
newly created home file.
- Statements about any matters that could ultimately
affect title to the property such as lawsuits.
- Disclosure statements about any tenants other than
the buyer or seller that occupies the property.
- Disclosure statements related to construction contracts
entered into within the past three to six months.
The buyer will also be asked to sign Sanity documents
that states you have not been declared mentally incompetent
and that you are still employed at the same place and
are over eighteen years of age.
3. Distribution of Funds.
The tile company will generally disburse funds once
all the other documentation is signed, dated and notarized.
Because everyone usually gets paid out of the closing
proceeds, the title company will not accept personal
checks. You must bring a cashier's check. Your lender
will be able to provide an estimate of closing costs
prior to closing (see "Closing Costs" in this
section).
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