Buying a new home is an exciting event. However, it can also be overwhelming, especially for first time homebuyers. After making it through the contract negotiations, inspections, appraisal and loan approval, you don’t want the deal to fall apart at the closing! Here are some key things to keep in mind in order to make the day as easy as possible.
Don’t open new credit lines
For many lenders, it is standard practice to pull a current credit report right before the closing. In doing so, they are reconfirming credit scores and allowable credit ratios in order to fund the final loan. Homebuyers who are excited about their upcoming purchase might be tempted to rush out and open new credit accounts to purchase home furnishings, updated carpeting, etc. But this can lead to overextending credit limits and debt ratios or incurring a slew of new inquiries which can threaten the entire purchase transaction. The best advice in this situation is to pay cash or wait until after the mortgage loan is closed to apply for new credit.
Bring all necessary documents with to closing
It is not uncommon for lenders to require last-minute documentation as a condition of the loan approval. Additionally, the title company will require certain documents, such as proof of identity, at the closing. To be fully prepared at the closing, homebuyers should bring the following with:
- Government-issued photo ID
- Separation or divorce papers
- Copy of the purchase contract
- Proof of homeowners insurance
- Home inspection reports
- Any information still required by the lender
Be prepared with funds needed at closing
Closing on a purchase transaction will require the purchaser to bring funds to the closing. These funds are necessary to cover the down payment, escrow, fees, etc. The title company may require a cashiers check or a wire transfer on the day of closing. This could mean planning to make a trip to the bank during business hours to get the certified funds to bring to the closing. Or if a wire transfer is required, it is imperative to understand the bank’s wiring procedures, which can range from one to three days to complete a transaction. Homebuyers that plan well in advance for their closing funds are better situated to avoid closing delays.
Work with an experienced real estate attorney
A home purchase is one of the biggest investments most people will make in their lives. As such, this is not the time to attempt to proceed without an attorney. This applies to first time homebuyers, as well as those who are on their second or third home. Every home purchase transaction is different and there are so many opportunities for things to go wrong. A qualified attorney can help to avoid problems outright, or help resolve issues that arise during the process.
Our experienced legal team assists homebuyers throughout the purchase process, from negotiating the purchase price and terms all the way through to closing day. When we represent you on the day of closing, we will:
- Ensure all terms of the purchase contract are being met
- Resolve any issues from the final walkthrough
- Review all of the closing documents to ensure accuracy
- Help clear up any title discrepancies
- Answer any questions you have during the closing
If you are in the market for a new home, call our office at 847-223-1500 as early as possible in the process so we can provide the important legal protection you need for this exciting new investment.