After finding your dream house and a lender you can work with, closing the sale can be overwhelming and confusing if you’ve never been through the process before. You can trust your title company or closing attorney to track all of the important regulatory details. You may feel more confident if you understand what's going on and arm yourself with a checklist to ensure you don't forget any important documents and inadvertently delay the closing.
You’ll be required to bring copies of various documents to the closing. You need to arrange for homeowners insurance to take effect immediately after the closing, so you should contact your insurance company to arrange for coverage. Bring a copy of the insurance confirmation to the closing. Your lender also will need the insurance information. Many homeowners bundle insurance and use the same company for car, health, life and homeowner’s insurance to get a better deal.
Closing costs vary from one transaction to another. You will most likely need to have a certified check for closing costs, which could include title transfer fees, your real estate agent’s commission, termite and inspection bills, filing costs and attorney fees. You also may be required to pay homeowner’s association fees at the time of closing or bring the down payment to the meeting. In some states, you may be able to arrange for your bank to transfer funds into your attorney’s account, making it her responsibility to distribute the payments for closing on your behalf. Your lender is required to provide a closing statement that spells out how much you need to bring to the closing and the other financial details of the transaction. You should get this form a day or two before your closing date.
At the closing, you may meet a number of professionals for the first time. As part of the legalities, you’ll be asked to provide at least one form of photo identification, such as your driver's license. The documents you sign may be notarized and the notary needs to verify your ID, even if everyone knows you. Just in case it's needed, you might want to be prepared with a second form of ID, such as your Social Security card or passport.
During the process of buying the house, you’ve most likely accumulated a folder full of paperwork. Take the entire file with you for reference in case you need to supply additional supporting information at the last minute. Your lender may require you to prove you had a pest inspection done, for example, if they didn't receive a copy. You should carry a copy of the initial Good Faith Estimate you received from the lender so you can compare the final costs. Some variation is to be expected, but there shouldn't be any big surprises. If you want extra time to review the documents before closing, ask your attorney or real estate agent for a copy a day or two ahead of time. Keep in mind that the final paperwork may not be ready until closing day, but you might be able to at least read a blank version of the standard forms. Note any questions you have and take them with you to the closing so you won’t forget to get important questions answered.
Linda Ray is an award-winning journalist with more than 20 years reporting experience. She's covered business for newspapers and magazines, including the "Greenville News," "Success Magazine" and "American City Business Journals." Ray holds a journalism degree and teaches writing, career development and an FDIC course called "Money Smart."