Real Estate Closings by BHAA Abstract & Title
What can I expect at a Real Estate Closing? When purchasing a home or a piece of property, the final step of the transaction is referred to as the “closing.” For many, the real estate closing can be a very exciting part of the purchasing process. However, for some, the closing process can be quite overwhelming. At BHAA Abstract & Title, LLC, we strive to make the closing experience a happy and memorable one, while also ensuring that the closing process is as seamless as possible. At the conclusion of the closing, the Buyer will leave as the owner of the new property they acquired at closing, while the Seller will leave with the net proceeds from the sale.
Whether you are the Buyer, Seller, real estate agent, or lender, try to ask your questions ahead of closing day to avert delays. New regulations promulgated by the Consumer Financial Protection Bureau require that a Closing Disclosure form (formerly the HUD-1) be sent to the Buyer/consumer 3 days in advance of the closing. This window of time affords the Buyer/consumer a chance to review the details of the transaction and to identify any problems or issues prior to the closing. We always strive to move the closing along in a timely manner.
How long will my closing last? At BHAA Abstract & Title, LLC, we strive to make every closing fun and to provide a friendly atmosphere. Typically, we will briefly explain each document being signed to ensure that all parties are comfortable with the transaction; however, we are always willing to answer any and all questions presented. Our “purchase transactions” typically take forty-five (45) minutes to one (1) hour to complete and our “refinance transactions” typically take thirty (30) minutes to complete. In either case, if the Buyer, Seller or Refinancer has additional questions or needs additional time to examine or discuss the documents, we are more than willing to accommodate them.
What is the role of the Buyer at a Real Estate Closing? If you are the Buyer and you are borrowing money from a lender in connection with the purchase of the property, you will not only sign the documentation necessary to make the sale a legal contract, but you will also sign documentation related to the loan contract. This documentation is referred to as the “closing packet” and will also include a mortgage over the property you are purchasing.
If you are the Buyer and you are borrowing money from a lender, lenders will require that the Buyer purchase a lender’s title insurance policy, or, at minimum, a thirty (30) year title opinion on the property being mortgaged. When a lender’s title insurance policy is required, the policy provides the lender coverage in the amount of the mortgage and will ensure your lender is insured in the event a title defect is discovered in the future. It is important to remember that a lender’s title insurance policy only provides coverage for the lender, not the Buyer.
As a Buyer, you also have the option to purchase an owner’s title insurance policy. Owner’s title insurance is always recommended to ensure that you, as Buyer, are protected from title defects that were unknown at the time of the closing. If you opt to purchase this insurance, you can also expect to sign documentation related to such insurance. The cost of an owner’s title insurance policy will be dependent on the value of the property being insured.
What is the role of a Seller at a Real Estate Closing? The Seller’s role in a closing is typically much less involved than the Buyer’s and, in large part, involves signing documents to establish a legal sale and to covey ownership and clear title to the property to the Buyer. The Seller may also be required to sign documents that guarantee certain aspects of the property sold. For example, BHAA Abstract & Title, LLC requires that the Seller to sign an affidavit attesting that there are no judgments or liens affecting the property; that no party, other than the Seller, is in possession of the property under any unrecorded leases, tenancy at will or otherwise; and that there are no known boundary or encroachment issues affecting the property. Further, it is the Seller’s obligation to ensure that clear title and full ownership of the property is conveyed to the Buyer at the time of closing. As such, any curative work required to “clear title” to the property will be the responsibility of the Seller.
At the closing, the Seller should bring any keys or remotes to the home to give to the Buyer.
What do I need to bring to the closing? Both the Buyer and Seller will need to bring a valid driver’s license to the closing. In addition, as Buyer, often you will be required to bring funds to closing. State law requires that the funds brought to closing be “certified”, which include: cash, certified check, credit card, cashier check, or funds received by wire transfer. Personal checks can be accepted only up to the amount of $2,500.00.
In addition, many times a homeowner’s insurance policy will be required for closing. If so, the Buyer will be required to provide the lender proof that the first year’s premium has been paid prior to closing or is collected on the closing disclosure or settlement statement.
Who will be at the closing? To culminate the sale, the closing often involves the Buyer and Seller sitting together at the same table to sign all documentation necessary transfer ownership and title of the property bring purchased. At every closing at BHAA Abstract & Title, LLC, the closing attorney will be present. If the Buyer or Seller has a real estate agent, they will often be present at the closing. Also, the Buyer’s lender may attend the closing. It is preferred that the Buyer and Seller attend the closing in person; however, if one of the parties to the sale is not able to make it to the closing table, there are other options available. In the event you are unable to attend the closing, it is important to notify the attorney handling the closing immediately so arrangements can be made ahead of time to ensure the closing process remains as seamless as possible.
At BHAA Abstract and Title, we look forward to assisting you with your title and closing needs.