Guide to a Successful Real Estate closing by Lazaro Dinh
The experience of selling your property could be delay or worst yet costly if these steps to a successful closing are not followed. Avoid a painful Real Estate closing experience. Follow these 8 steps to a successful Real Estate Closing.
1- Check title and lien search to avoid last minute surprises.
Ask your title agent for all upfront fees related to the sale of your property before you start marketing it to insure you sales price will cover your expenses. Ask for a title and lien search in advance to make sure you do not have liens, open permits or violations that you are not aware of so you can take care of them in advance. Some if these violations could cost you thousands in time and money if not addressed properly.
2- Get estoppel letter in advance if you are in an HOA.
If your property is in an HOA or condo association, ask your property manager for an estoppel letter showing your balance due, this will be necessary to close and mandatory for any buyer to have in order to close. Some associations on HOA’s could take up to 30 days and charge a fee for this service.
3- Make sure buyer has deposited escrow and supplied proof.
This section might seem redundant but it is a fact that many times Buyers either forget or try to avoid sending in the escrow money after the contract is signed, if you are being represented by a Realtor, make sure they collect the escrow funds on your behalf as per the contract terms. It is always beneficial to have the escrow funds sent to your title agent representing you (the Seller) in the transaction.
4- Ask Buyer if you can choose your title agent.
In many states choosing your title Agent means that you pay for the title policy for the Buyer, it is up to you to decide if you want to incur that fee which could be in the thousands. Once thing I know from experience is that controlling the deal with your title Agent can make or break the deal and ultimately cost you more than just money.
5- Check with buyer on loan commitment if paying with a mortgage.
There are two types of Buyers, cash Buyers and mortgage Buyers. If your Buyer is getting a mortgage, it is imperative that you check the status of the loan commitment along the way to make sure everything is going to plan. Mortgage Buyers fall out of contract because of financing every day for multiple reasons. It is always wise to have a backup Buyer on deck.
6- Ask for proof of funds from buyer if paying cash.
If your Buyer is paying cash, always ask for proof of funds, it is your right to see if they are qualified to pay cash and or if the cash is subject to another deal that may or may not close thus killing your deal. There are more cash buyers than ever nowadays but just make sure they have the funds ready to go.
7- Be aware of assignable contracts and long inspection periods.
Always be aware of contracts with assignable clauses and long inspection periods, there are many “flippers” out there who just want to assign your contract for a fee or just waste your time. If you see an assignment clause, ask why and definitely limit your inspection periods to less than 10 days. If the Buyer asks to show the property multiple times while you are under contract, this is a red flag and they are probably trying to “flip” the contract.
8- Check the closing statement for mistakes.
Finally closing day is here and you are ready to close on the sale of your property. What could possibly go wrong at this point?
Check the closing statements for mistakes, overcharges and fees that should be paid by the Buyer. This is where using you friendly title Agent comes in handy as a good title Agent like the one I use always looks out for my best interest.
