The closing is the end of the long and arduous process of buying Asheville real estate. Closing the deal is what the closing is all about. You are ending the process of purchasing Asheville real estate and the agreement to the mortage to purchase that real estate. Essentially it's the final transfer of money and keys.
Timing is everything
It is key to understand the timing behind the transaction in order to avoid some critical errors. Consider your current living situation. If you are renting you may consider trying to time your closing around when your lease ends. Plan to have some work done on your new place? You might want to time so the work is done before you move in. Coordinating two closing dates is another common situation where you will want to consider the best time to do each. Most folks need the cash out of the first house to pay for the second house, so schedule the closings in the right order. There is a lot involved with any closing so it is best to plan the whole day for the process. If it doesn’t take as long, you have some time to sign with relief and celebrate!
The mortage should also be considered in terms of closing so as to get in on any interest rate lock and lender commitment. Be aware also that closing at the end of the year involves taking care of taxes. Any points and interest paid before the New Year can become deductions for this year's taxes. Check with a tax adviser for the timing of any other deductions
Sign here ... and here ... and here
Most closings are actually two closings. You'll be closing on the purchase of real estate, and you'll be closing on the mortgage loan you are taking to buy that real estate. There are documents that are unique to your area and maybe your situation but, for the most part, most documents are going to be those used for any closing.
The following documents you can expect to read and sign with any closing:
- Truth in lending statement, also known as Regulation Z, will disclose the interest rate, annual percentage rate, amount financed and the total cost of the loan over its life.
- Monthly payment letter reveals the break down of your monthly payment into principal, interest, taxes, insurance and any other monthly escrows.
- The Note is where you're actually borrowing the money -- and giving your personal guarantee to pay it back.
- Mortgage puts a lien on the house as security for the loan -- allowing the bank to foreclose if you default on the note mentioned above.
- HUD Form 1 or Disclosure/Settlement Statement is a form that contains all the actual settlement costs and amounts.
- Warranty deed includes the names of the buyer, the seller and a description of the property and will often contain a guarantee that the seller has the right to sell the property. The Warranty Deed transfers the title of property.
- Proration agreements are the remaining costs of the house for the month it is purchased to be divided equally between the buyer and seller.
- Tax and Utility Receipts act as an acknowledgement of what has been paid or will be paid by the borrower to the city and state.
- Name affidavit certifies that you are who you say you are.
- Acknowledgment of reports ensures that the buyer is aware of all reports and agrees to said condition of the house.
Search or Abstract of Title gives a listing of every document that has been recorded about the particular piece of property.
Note about money on hand: the buyer, and sometimes even the seller, are expected to have money on hand at the time of meeting. You'll want to bring a certified check for the correct amount. You can expect to pay a portion of the closing costs, among other items that you will need to verify beforehand.
Often the buyer's annual taxes, insurance and other items are paid through the lender. An escrow account (or reserve) are established at this time.
Call us today at (828)-215-9064 or contact Green Mountain Realty to learn more about the closing process.