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6 Tips To Make Sure You Closing Goes Smoothly
Dated: May 21 2014
1. Ask questions!
Knowing what to expect and communicating with all parties involved in the deal are key to a successful closing.
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2. Anticipate human error
I recently represented a buyer whose closing failed because of missing loan documents. The buyer was a co-signer on his brother's mortgage, and the lender had requested 12 canceled checks showing that the brother, not the buyer, was paying the old mortgage. The buyer could come up with only eight checks, and the loan officer said that would be enough.
That was weeks before closing. I kept saying that wasn't going to work. The requirement is 12 checks. How can eight checks be sufficient? Three days before closing, the lender said it couldn't issue the loan without the 12 checks, and the deal was canceled.
Sometimes people don't know as well. "I asked his loan officer, 'How can you give someone an approval letter when you don't have all the documentation?' And his answer was, 'Well, now I learned it.'"
3. Review loan documents in advance
One way to ensure all is going as planned is to tell the lender that you want to review the documents before closing, or ask your attorney to do so.By law, you have the right to review the closing-settlement statement, or the HUD-1 form, at least 24 hours before closing. Compare that form to the good-faith estimate you received when you applied for the loan. You should have everything you are going to sign before you sign it, A lot of people don't do that. When they get to closing, they are nervous, and they just want to sign and get the keys. That's how people get in trouble.
4. Take a check
Another reason to review the loan documents in advance is so you know how much money you must bring to closing. And yes, you will need a check at closing, most likely a certified one.
Some people think a wire transfer is faster, but the closing won't happen until they have actual confirmation that the wire hit. Depending on the time the transfer was made, it could be a huge problem.The buyer must also bring photo identification and a copy of the homeowners-insurance policy, as well as the good-faith estimate, the HUD-1 statement or both, in case there are discrepancies.
5. Take the day off
A smooth closing may take less than 30 minutes, but you won't know for sure if your closing will go as planned until it's done.There may be delays, especially if you are closing at the end of the month. Sometimes, people have to sit there for hours and say, 'I've got to get back to work.
Trying to close during your lunch break is a bad idea. Imagine you get these delays, and you are on your lunch hour. Now you're hungry, you're frustrated and you're late. That's a pretty bad combination.
6. Expect the unexpected — including typos
You're at the closing table.
You're told everything is good to go.
All you need to do is sign.
You must double-check the numbers on the mortgage note you are signing, even if you have received the HUD-1 form before closing.One of the biggest holdups in closing is when the mortgage documents are incorrect. Sometimes, you have to correct the interest rate, or the amount is wrong and you need to fix it.Because of a simple typo, your loan documents may need to be sent back to the lender to be redone.
To prepare for these unexpected delays, borrowers should try to schedule their closings for earlier in the day. And don't wait until the last day on the contract to close.You shouldn't get to that line, especially when you are buying a foreclosure or short sale.
Denver Colorado Realtor -Michael Steffen
Michael is a motivated realtor specializing with investors and new home buyers located in the following areas; Denver, Arvada Aurora Bennett Byers Castle Pines Castle Rock Centennial Cherry Hills Village Columbine Valley Deer Trail Denver Elbert Englewood Franktown Greenwood Village Highlands Ranch Larkspur Littleton Lone Tree Parker Sedalia Sheridan Strasburg Watkins, Wheat Ridge, Lakewood, Castle Rock, Thornton, Westminster, Evergreen, Golden. Michael Steffen
My name is Michael Ross Steffen. I’m an Exit Realty Cherry Creek Agent in the Denver metro area and Team Leader For Generation Property Group! We specialize in advanced Internet marketing, buying, s....