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Closing a Home Purchase: What to Prepare

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By : Roby Hicks    99 or more times read
After choosing the house to purchase, you need to prepare for the closing. The closing is the final transaction in home acquisition. However, it is not as simple as it seems because there are many things to be prepared. The first thing you need to prepare is the payment for the fees and charges. Many home buyers have encountered problems because they failed to anticipate this. If you want a smooth closing, you should be able settle all your obligations to the lender, the lawyers the closing agent and as well as the seller.

Fees and charges

If you do not know how much to prepare, ask your lender ahead of time. You can also inquire from your real estate agent or conduct a research on the common fees and charges that should be settled during the closing. Some of the commonly paid fees are the origination fee, the credit report fees and the appraisal fees. You will be charged with other fees as well. What is important is that you are aware of the amount you need to raise. You should also learn about the negotiable charges so that you could bring your payment down.

Closing date

There are also other preparations. First, it is very important that a date is set. This should be done after the loan has been approved. It should also take place when the buyer has already received the commitment letter. The real estate agent is a big help at this point because he will coordinate with the others. He will make sure that the seller, the lender and the others will be there.

Closing agent

A closing agent has to be chosen too. This agent will handle the documents to be discussed during the closing. There are different institutions that offer this service. It could be from the lending company as well as the title insurance company. The buyer or the seller can choose the agent. However, a real estate agent often does it.

Title and other forms

A title search will also be required prior to the closing. This is to ensure that the buyer will acquire a clean title. For added protection, the lender will also require a title insurance.

You should also be ready to review the different documents that will be given to you. This includes the HUD-1 form. This will indicate the details of the fees and charges you need to pay. Since this will be given in advance, study them carefully and take note of the items you want to ask. You need to review other documents as well. Some of them are the mortgage and the Truth In Lending (TIL).

It is also important that both the buyer and the seller read and understand the documents presented to them. They can either agree or disagree to the items indicated. The closing agent has the duty to explain everything to the parties involved. He should also answer questions that they may raise. If they agree to the terms, they will sign the documents. The parties can have their respective lawyers with them. This is to ensure that their rights are not violated in any way.
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