Get Prepared for Closing Day
Closing day is the mutually agreed upon date by the seller and buyer for the transfer of funds, title and the keys (usually). This can be a stressful time for both parties considering that this may be the largest sale or purchase of a lifetime. A few preparations can make the transaction flow smoothly.
Buyer Preparations
Review carefully:
o the closing statement and double-check the calculations.
o the lender, title and fees to ensure that what was discussed is accurately reflected in the documentation.
o the exact legal description of the property and any liens, encumbrances or other items which may have been discovered in regard to the property. Ensure that the title has the correct title on the deed.
Buyers should arrange with their realtor to re-inspect the property just prior to closing. This will avoid any surprises on moving day. On or after closing day, buyers have less leverage to demand that repairs or other promised changes actually be completed. If the seller promised to repair a fence or open the pool you have a right to insist that these be done.
Honest mistakes have been known to happen but these mistakes can be costly, so before signing your name to any closing document be sure that the interest rates, miscellaneous fees and the condition of the property are all what you agreed to.
Seller Preparations
o Whenever possible avoid closing on a Friday, at the end of the month, or before long weekends. If anything goes wrong the banks and lawyer’s offices will be closed.
o Utilities. Have the meters read as of closing date for water, electricity and gas. This will avoid any gaps in service for the buyer and extra expense for the seller.
o Services into the home are the responsibility of the seller. At least a week before the closing date, contact your cable television, telephone and Internet service. Terminating service on or just before closing day can save you additional charges.
o There are also several adjustments to consider. These are designed to settle any expense incurred (or income earned on rental properties) by either you or the buyer as of the day of closing-which is what both parties want. Municipal property taxes, school taxes, monthly condominium fees, utilities, and fire insurance (plus sales taxes) are all common expenses that need to be adjusted at closing.
o Prepaid expenses before closing day are pro-rated, with the buyer reimbursing you for the period which you no longer own the property.
If both parties plan ahead and review all paperwork carefully you can have a worry free closing day.