Beginner Guide to Buying a Home series – Week 12

This step-by-step series will take you through the entire home-buying process — from finding a buyer’s agent to settlement day, and all the details in between. Every first-time buyer will find this information-packed series easy to follow and understand.

This series ends with today’s article but stay tuned next week for a bonus article on maintaining your new home!

You are almost a homeowner! But before you can celebrate, you’ve got to gear up for a successful settlement day. And that means no surprises, no delays, and no leaving without the keys to your new home.

There is a lot to do on the days leading up to your closing and settlement. You’ll be better prepared and on top of everything if you know what to expect. Some of these tasks were covered in last week’s article, Almost There … Pre-Closing Details for Buyers.

Today’s article will touch on some of those tasks again but will also cover more of what happens during the settlement. That way you stay calm and know what to expect!

Here’s a handy breakdown of what you need to do at each stage of the process:

Pre-Closing Tasks to Complete:

Get homeowner’s insurance. Make sure that it starts the day of the closing; no later, even if you are moving in later.

Don’t hurt your credit (loan!). It can’t be said enough, do not do anything to change your current financial situation. No car loans or leases, no new credit cards, no cosigning. If it impacts your credit score or debt-to-income ratio wait until after you close. When in doubt check with your mortgage representative.

Connect your utilities. Make sure you make it effective for the day of settlement, even if you are moving in after settlement.  The seller will turn them off in their name the day of settlement since they will no longer be the owner of the home.  To avoid any reconnection fees, make sure the utilities start in your name the day of your settlement.

Give yourself enough time to move funds around.  Remember banks will often hold large transfers for up to 3 business days so give yourself a cushion if you are moving money between accounts. And remember to keep these transfers visible and easy to trace – no large cash withdrawals and deposits.  If you’d prefer to wire your funds directly to the closing lawyers account instead of bringing a certified check, get the instructions from your agent. Any emails or calls changing the wiring instructions should be verified by you with a follow up call to the original number you have been using all along to communicate with the party involved.

Settlement Day To-Dos and Logistics:

Your Final Walk-Through

You will be allowed to do a final walk-through of your home prior to closing. Schedule it a day or two before this way if anything is amiss your lawyer has time to address it. The final walk-through should take about 30 minutes.

This is your opportunity to see if any damage has been done to the property and if any agreed upon repair work has been completed. Carefully go through the home one more time. Remember this is an opportunity to make sure nothing has changed, and everything is working as it did during the inspection. This is not a time to address new issues. 

You are not doing another inspection, but just making sure that any repairs that were agreed upon have been done and ensuring the home is still in the same condition as when you wrote the contract. 

What to Bring to Closing

• Bring your driver’s license or some form of photo ID.
• The settlement company will calculate the amount of money you need to bring to the closing.  You’ll need to bring a certified check for this amount.  You may not get this number until late the day before, or worst case the morning of the closing so leave time to go to the bank. Also bring your checkbook or get a few checks from your bank if you don’t have a checkbook just in case there are last minute adjustments. 
• Bring all important documents that you have gathered during the home-buying process, proof of homeowner’s insurance, contract. 
• You should already have received the Closing Disclosure form, also called the CD (it replaced the HUD-1 Settlement Statement) and reviewed it to ensure your personal information was accurate. This form lists all final terms of the loan you’ve selected and final closing costs.  It details each expense, who is responsible for paying it, and who the monies are going to (e.g., how much the seller is getting, how much the seller’s mortgage company is getting, etc.)

What to Expect at the Closing

You and your lawyer should plan to attend the closing at the specified time at the whichever lawyer’s office was agreed to, the seller and their lawyer as well as a title company representative and a representative from the bank, often the banks lawyer.  Many closings can take more than an hour, so plan accordingly if you must take time off from work.

This is the day where the sellers will legally transfer the property to you. The title company representative acts as a third party overseeing the terms in the contract to ensure they are being carried out and the transfer of ownership occurs.  They don’t represent you or the seller, but the terms of the contract. 

This company also handles the closing process for that day. This is to ensure that all parties involved (you, the seller, your lawyer, their lawyer) can properly oversee the transaction. Your agent and the seller’s agent may or may not be there. Since COVID closings tend to be limited to the participating parties. Your agent may stop by near the end of the closing.

The settlement company will handle the documents, money, and any other items from all parties and make sure that everybody gets paid where necessary. 

Stay calm! You will be signing a lot of documents that day so make sure you understand and know what you are signing. Ask questions and confirm amounts if necessary.

Congratulations … You bought your home!

You’re all set to move into your new home now that you’ve made it through your settlement.  It’s time to celebrate and start unpacking.

Now that you’re a homeowner, you’ve got to take care of your new home. Next week’s bonus article, Maintaining and Loving Your New Home, is perfect for you. I hope you have enjoyed my Beginning Guide to Buying a Home series and that it will help you become an informative and confident buyer.

If you’ve enjoyed this series, I’d love the opportunity to help you become a homeowner. 

Our first step together would be a 30-minute meeting where we’d discuss the steps in the home buying process, talk about your criteria and see if you qualify for any first-time home buyer loans that could save you money. 

Even if you don’t think you are ready to buy for years, I’d love to meet you and help you put together a plan we can implement whenever you are ready.  My goal is to help you when you are ready, not pressure you to do something that isn’t right. 

So, email me to set up a time to talk, or you can pick a time that works for you on my Calendar so we can talk more about you specific situation and put together a list of things you can do between now and when you are ready to become a homeowner.  That way you’ll have all your ducks in a row when the time comes.