Now that we have an accepted offer, what’s next?
We have 10 days in which to conduct a Home Inspection, negotiate repairs and/or credits and decide to proceed with the sale. We both attend because you will learn much about the mechanics of the home. Should you be out of the area, I will attend. You will have a report listing every detail of the home.
This is also the time to be in touch with the lender to provide whatever is necessary for the final loan documents. It is very important to return documents to your lender As Soon As Possible. New government regulations have slowed down the mortgage approval process and any delay can result in a delayed closing. With regards to the new Truth in Lending/RESPA Integrated Disclosure (TRID) regulations, mortgage professionals have educated us to:
- Remember the mortgage industry is highly regulated
- Be responsive to your lender’s requirements–the mortgage process is an assembly line–the file will not move to the next stage until all information is provided, even a simple document
- Respond immediately to lender’s requests
- Closing Dates should be at least 45 days out
- Disclose everything to your mortgage broker
- No new credit or increase in credit card balances at this time
- No late payments
- No job changes
- No large deposits into bank accounts or deposits that cannot be documented
- Pay attention to where the escrow deposit comes from-do not accept a third party check, and if it’s a cashier’s check make sure the source of funds can be verified
- Any seller concessions must be a credit towards closing costs (no seller credit for repairs)
- Notify lender if there will be a power of attorney or property held in trust
- Notify lender of the condition of the house (peeling paint, rotted sills, moisture, roof, safety hazards)
- Avoid closing on a Friday, last day of the month or Tuesday coming off a holiday weekend
- Require seller to complete repairs at least 14 days prior to closing.
The lender will go through the underwriting process and a commitment letter will be issued. The lender will want to know who you prefer to use for a closing attorney (some lenders only work with particular approved attorneys). I can recommend an attorney if need be. The lender will require you provide an insurance binder for homeowner’s insurance. If you do not have an insurance company, I can recommend one. You should arrange for insurance ASAP.
As the buyer, you will want to arrange for the utilities to be turned on once the seller has made arrangements for them to be turned off. This is usually done in the last week before the closing. Make sure all magazines, bills, family and friends have your new address as well. Anything related to school registration should also be done well in advance and can be done as soon as a Purchase and Sale Agreement has been executed.
Three days prior to closing you will receive your settlement statement from your lender for your review. This will have all of the bank charges, attorney’s fees, tax and fuel prorations, and any negotiated concessions. The final amount of money needed at the closing will be on this document.
The day of closing or the day before if possible, a final walk through is conducted to make sure that all is as it was when inspected or if any repairs that were requested have been completed.