10 Steps To Closing

10 Steps To Closing

  • Trevor Wissink-Adams
  • 04/18/19
Buying a home can be stressful. After all, you need to get pre-approved for financing, find a home that meets all of your needs, make an offer and then hope it’s accepted. If the seller likes your terms, that’s a win worth celebrating, especially if you were in a competitive offer scenario.
While you’re just starting your journey, try not to feel overwhelmed by what’s ahead of you. This guide will walk you through what to do next.

1. Submit Your Offer Deposit

When your offer is accepted, you will submit your offer deposit (in most cases a check for $1,000) to the listing agents office. In most cases, the check will be addressed to the seller’s brokerage. Plan to drop this off at their office 24-48 hours after your offer is accepted.

2. Schedule Your Inspections

As soon as you have an executed offer, begin scheduling your home and pest inspections. If there’s a serious structural or pest-related issue, you may only have a limited window to cancel the home-buying contract. We will be there for the home inspection and are happy to schedule it on your behalf.
The purpose of the home inspection is to make sure the house is physically sound and that there are no major issues. A typical home inspection checklist for buyers includes things like ensuring the home doesn’t have structural issues, faulty wiring, issues with the plumbing system, problems with the HVAC system, and broken windows or doors. You will receive a detailed electronic report from your inspector within 24-48 hours of the inspection.
Depending on the size of the home or condo, inspections can run between $500-$750, and the average fee for pest inspection is $75. The same inspector will conduct both of these. See the end of this document for recommendations.

3. Shop for a Loan + Get an Appraisal

As all of this is happening, you should begin shopping for a loan. In general, we recommend reaching out to at least three loan officers to ensure you’re getting the best rate. See recommendations at the end of this document.
One of the most important parts of mortgage underwriting is the appraisal—an estimate of the home’s value. Lenders use the appraisal to make sure the home is worth the amount you want to borrow.
The lender will schedule the appraisal as part of the loan application process. As the buyer, it’s your responsibility to pay for the appraisal. Generally, appraisals are between $300-$400.

4. Find an Attorney

Real estate attorneys are lawyers trained to address the legal issues surrounding property interactions. Among the documents real estate attorneys typically handle are purchase agreements, mortgage documents, condo documents, title documents, and transfer documents. See attorney recommendations at the bottom of this document.

5. Sign the P&S

You will sign the P&S via docusign and then deliver the earnest money deposit to the seller’s agent, typically addressed to the seller’s brokerage (same as offer deposit).

6. Make Your Earnest Money Deposit

Earnest money deposits are usually 5% of the sale price less the $1,000 offer deposit. This is a show of good faith that you plan to go ahead with the home purchase. In general, it is addressed to the listing agents brokerage. This money is generally held by the seller's broker or a title company, to be used as a credit toward your down payment and closing costs.
Make sure your contract specifies if and when you can get your earnest money back if the sale isn’t finalized. Consider asking your agent to include a clause that makes the deposit refundable if, for example, your financing falls through or the home appraises for less than what you offered.

7. Buy Homeowners Insurance

By now, you should be excitedly counting down to closing. You’re almost there! And at this point your lender may be asking you for proof of homeowners insurance, so have that ready. Once you get a policy, the insurance company should prepare the documentation your lender needs to verify your coverage. The biggest question is figuring out how much insurance you need, so ask your insurance agent to help you come up with the right number.

8. Schedule the Walk-Through

The walk-through is the final step before closing. We will attend the walk-through with you to make sure everything is in working order, including:
  • Making sure all the light switches work
  • Running the water in the kitchen and bathroom to check for leaks
  • Testing out the stove, microwave, dishwasher, fridge, and any other major appliances you’ll acquire in the sale to make sure they work
  • Checking all the windows and doors to make sure they don’t stick and that the locks work
  • Flushing toilets and running the garbage disposal
  • Checking the walls, floors and ceilings for any signs of damage
  • Running the AC and heating system
  • Making sure the house is clean
If there are any issues, the walk-through is your opportunity to point them out. We will help with getting any problems resolved quickly to keep your closing from being delayed. In general, plan for the walkthrough to occur the morning before the closing is scheduled.

9. Get Ready to Close

Closing is the very last thing to do in the home-buying process. You will sign all of the paperwork that the lender requires, pay your closing costs, and collect your keys.
In terms of closing costs for buyers, these may vary depending on your loan. Typically, you can expect to pay between 2% and 5% of the purchase price to cover the various fees required to finalize your loan. These include origination fees, appraisal fees, title searches and insurance, credit-check fees, legal fees, and mailing fees.
The amount you’ll need for closing will vary, based on the details of your loan, and your lender should tell you beforehand exactly how much you need. Depending on what your lender requests, you’ll need to pay the closing costs using a wire transfer, cashier’s check, or a certified check. That’s something your local bank branch can help you with.
Plan to block our two hours for the signing. The closing agent then files the paperwork with your county recorder or register of deeds office to make it official.
After that, the home is yours! You’ll get additional documents from your lender in the mail explaining your options for paying your mortgage. Generally, your first payment is due one full month after the last day of the month in which you closed, which gives you time to prepare.
In this final step the county clerk date-stamps the property deed and the property legally changes hands. The escrow ends at this time and the keys to the home are handed to you.

10. Build your homeownership muscle

We are here to help and support you as you embark on your journey as a homeowner. We can provide recommendations for general contractors, plumbers, roofers, and beyond. Please don’t hesitate to reach out to us!

Work With Trevor

Trevor combines a deep knowledge of the Greater Boston market with thoughtful representation and unparalleled service to ensure a smooth, joyful transaction.

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