You’re almost there! Pre-closing is a critical phase to make sure you have dotted all of your “i’s” and crossed all of your “t’s”.
Within the first 10 days after your offer is accepted, you’ll need to apply for your mortgage. The mortgage company will require a very detailed look into the past few years of your financial life. They’ll require W2s, paystubs, and bank statements. And you’ll also need to explain any large deposits of cash.
Your bank will schedule an appraisal of the home’s market value, which varies based on other home selling prices in your area. If you’re a first-time homebuyer, this appraisal also factors into private mortgage insurance, or PMI.
Most mortgage applications take at least 30 days to complete. This is industry standard, so your sellers will expect it. The closing date will be scheduled to accommodate the month-long wait for financing.
You’ll also need to schedule a home inspection within the first ten days as well. This is crucial to the home buying process, even if your mortgage company doesn’t require it. Find a well-established Triangle Area home inspector.
The home inspector will walk through the property with you and find any problem areas, as well as explain the important elements of the heating, electrical, and plumbing systems in the home.
Inspections are not guarantees.
While the inspector can’t make any kind of guarantees on the quality of the house, they’ll notate any issues they find—major or minor. If there are issues in need of fixing, other professionals such as Triangle Area plumbers, masons, and roofers may need to provide estimates.
There may be back-and-forth between you and the seller to decide who pays for issues discovered during the inspection. You may negotiate with the sellers over repair costs, and whether or not the seller will need to deduct money off the selling price.
Inspections take about 3 hours, give or take. They should be scheduled within the first week or two after the offer is accepted. Written reports take a few business days to come back from the inspector. Copies of these reports will be provided to both agents.
It’s not technically required, but it’s a really good idea to hire a real estate closing attorney in the Triangle Area to help you navigate the final purchase and sale agreement with the seller’s attorney.
Real estate closing transactions have to be overseen by a licensed attorney. But in many cases, the attorney in question represents the bank or mortgage lender—they don’t necessarily work for you. And in law, that’s an important difference.
It’s not usually necessary to bring your attorney to the closing, but it’s strongly recommended that you have him or her review the Purchase & Sale agreement before closing.
You’ll need to research and secure homeowner’s insurance, as well. Your mortgage company may have stipulations on the amount and type of coverage you have.
A homeowner’s policy price is dependent on your specific property and area, and also the kind of coverage you need.
Once the insurance company initially approves you, they’ll send a binder, or temporary proof of coverage, which you’ll need to complete the closing process. You’ll then need to fill out a more detailed application in order to bind your policy soon after.
It can take about 2 weeks for the insurance purchase and proof to be completed. Start early!