How to Make Your Settlement Successful
This is the twelfth article in our series called Buying a Home 101: Everything You Didn’t Know You Needed to Know Before You Buy Your First Home. This step-by-step series will take you through the entire home-buying process — from finding a buyer’s agent to settlement day, and even to maintaining your home after you’re all moved in. Make sure to tune in every week!
You are almost a homeowner!! It’s an exciting time but it’s also time to gear up for your settlement. You want to have a successful day and avoid any surprises or delays.
You still have lots to do on the days leading up to your closing and settlement. No worries … here’s what to expect at your closing and what you should bring with you to make sure the transaction is finalized.
What to Do Prior to Closing
- Make sure that your homeowner’s insurance starts the day of the closing; no later, even if you are moving in later.
- Do not do anything that could change your financial circumstances, such as opening a new credit card account, getting a new auto loan, charging too much on your current credit cards. Even buying furniture before your settlement is a bad idea. This could delay or even cancel your mortgage. So hold off on any shopping sprees for your new home!
- Connect your utilities for the day of settlement, even if you are moving in after settlement. The seller will turn them off in their name the day of settlement since they will no longer be the owner of the home. To avoid any reconnection fees, make sure the utilities start in your name the day of your settlement.
Settlement Day To-Dos and Logistics:
Your Final Walk-Through
You will be allowed to do a final walk-through of your home prior to closing. This is your opportunity to see if any damage has been done to the property and if any agreed upon repair work has been completed. Carefully go through the home this one more time to see if anything is amiss since you have the opportunity to bring it up at your settlement (not afterward!).
You are not doing another inspection, but just making sure that any repairs that were agreed upon have been done and make sure the home is still in the same condition as when you wrote the contract. This should take about 30 minutes.
What to Bring to Closing
- Bring your driver’s license or some form of photo ID.
- The settlement company will calculate the amount of money you need to bring to the closing. You’ll need to bring a certified check for this amount. Also make sure you bring your checkbook just in case any minor last minute corrections need to be made.
- Bring all important documents that you have gathered during the home-buying process, including your good faith estimate, proof of homeowners insurance, contract.
What to Expect at the Closing
You and your agent should plan to attend the closing at the specified time. The sellers will also be there with their agent. Many closings can take more than an hour, so plan accordingly if you have to take off from work.
This is the day where the buyers will legally transfer the property to you. The settlement company acts as a third party overseeing the terms in the contract to ensure they are being carried out and the transfer of ownership occurs. They don’t represent you or the seller, but the terms of the contract.
They also handle the closing process for that day and you will all meet in his/her office. This is to ensure that all parties involved (you, the seller, your agent, their agent) can properly oversee the transaction. The settlement company will handle the documents, money, and any other items from all parties and make sure that everybody gets paid where necessary.
Stay calm! You will be signing a lot of documents that day so make sure you understand and know what you are signing. Ask questions and confirm amounts if necessary!
Congratulations … You bought your home!
You’re all set to move into your new home now that you’ve made it through your settlement. It’s time to celebrate and start unpacking.
Now that you’re a homeowner, you’ve got to take care of your new home. Next week’s bonus article, Maintaining Your New Home, is perfect for you. Here’s all you need to know when owning a home – from staying organized with all the paperwork and manuals (just think about all of your appliances!) to regular maintenance and upkeep (HVAC and more) that needs to get done throughout the year both inside and out.
We will be wrapping up our Buying a Home 101 series next week. We hope you have learned to be a smart and informative buyer and feel confident to own a home.