Closing Next Week?

The answer to this question depends on if you are the Buyer or the Seller. This post will address Buyers, check here for the Seller's perspective.

1. By now your loan should have received a "Clear to Close" from your lender, or it should very shortly. This means all the conditions of the loan have been met and your lender is ready to provide the loan funds for the closing. If you have not yet received a clear to close, the first thing you should do is call your lender to determine what more may be required of you. It is likely the loan is in underwriting at this point, which means you just have to wait a bit more while it is processed, and nothing more is required of you.
2. Schedule the final walkthrough. If I am your agent, I'll be reaching out to find the best time, usually the day before or the morning of closing, to make sure the property is in "broom clean" condition and substantially the same as it was during the inspection. If any repairs were negotiated, we'll make sure they are satisfactory. If I am your attorney, I will wait to hear from you/your agent to confirm this. If anything is found to be deficient, we will notify the other side and negotiate as necessary. ​​
   1. During the final walkthrough, keep in mind to check the major appliances, no new scuffs/scratches to the walls/floor, all kitchen and bath faucets/drains are in working order, cabinets and closets are clear of any of the Seller's belongings, and that any repair items were properly addressed.
3. Determine the amount of Cash Required to Close with your lender. This amount reflects the difference between your loan amount plus your earnest money (and any credits) minus closing costs and your down payment. It will vary depending on a variety of factors, including the overall purchase price, how much you have already paid in earnest money, and how much money you are putting down on the loan.
   1. As a note of caution, the final HUD/Closing Statement (which contains all the debits/credits of the transaction) may not arrive until the night before, or even the day of closing. This is due to the fact that the Statement relies on the title company, the lender and the Seller to submit figures, some of which relate to the other, so the final version takes time to compile. Your lender can give you an estimate of the Cash Required to close before the final Statement is issued.
   2. Many clients receive preliminary Statements and are concerned when they change before the final Statement is issued before closing. My advice: do not worry too much about preliminary statements. It is the final Closing Statement that matters, since that one contains all the information that earlier versions may have been waiting for.
   3. I also recommend sending more than the exact amount required, up to $5,000 or so, to account for any last minute changes to the figures on the closing day. I can't tell you how many times this saved my clients considerable hassle at the closing table. You will get back the extra funds as an overage check at the closing.
4. Wire Closing Funds to the Title Company.
   1. Call the Title Company to obtain the wire information. I can help with this either as your broker or your attorney.
   2. If the amount from step 3 is more than $50,000, you will need to wire the funds directly from your bank. This may sound difficult, but once you have the wire information from the Title company, you can call your bank and they will walk you through the process.
   3. Once the wire is complete, make sure to call the Title Company again to confirm that they received it.
   4. I recommend completing the wire a day or two before closing to ensure the funds arrive on time. Many times the longest part of a closing is waiting around for the funds to clear, so sending it early can help cut down on closing time.
5. Show up to the Closing. No need to arrive too early, but make sure to bring your Photo ID. If I am your Broker, unfortunately due to Covid it is unlikely I will be able to join you as I would prefer. If I am your Attorney, it is likely I will be joining you over the phone/Zoom. Either way, stay tuned for an upcoming post on what to expect at the closing itself!

That's it! This can be an emotional time, both nerve wracking and exciting. It is the culmination of all your hard work during the transaction and the home search that lead up to it. Many are superstitious so avoid saying "congratulations" until the official closing is over, but I'm glad to say congratulations at getting this far along in the process! You are at the "home" stretch now, just a few more days to go!

Please feel free to ask any additional questions you may have in the comments below, or reach out to me directly at 773-991-1529, or [email protected].