| A lot has to happen before you can close on a new | | | | * Lenders should give buyers a good-faith estimate of |
| home successfully. Some of it is your responsibility, and | | | | how much money to bring in-by certified check-to the |
| some of it belongs to others. But don't expect it to | | | | closing. Closing costs typically run about 3 to 6 percent |
| happen overnight or perfectly smoothly. There are too | | | | of the loan amount. |
| many factors involved. And there's a lot of money | | | | * One business day before closing, you have the right |
| riding on the deal, too-not all of it yours. So the wisest | | | | to inspect the Uniform Settlement Statement. This |
| thing to do is take care of everything at your end; dot | | | | itemizes the costs of all services you must pay at |
| every "i" and cross every "t" that you can from your | | | | closing. |
| end of things. | | | | * The lender is also responsible for giving you a |
| Also, be picky, picky, picky about who you're doing | | | | truth-in-lending statement that states all the details |
| business with; from the get-go, choose only the most | | | | about the cost of the loan. |
| experienced, successful professionals and companies | | | | * The title company's job is to research public records |
| that you can find. They have what it takes to make | | | | and verify that the buyer and the seller don't have any |
| the long, complicated process considerably more | | | | lawsuits, liens, or judgments against them or the |
| bearable. For example, if it's possible, it's a good idea to | | | | property. |
| go with a Texas-based lender, because of Texas real | | | | * One of the real estate agent's jobs is to stay in |
| estate laws, some of which differ from that of some | | | | contact with the title company during the research |
| other states. An out-of-state lender might make some | | | | phase, just to make sure that any problems that might |
| mistaken assumptions that could add to delays. | | | | surface are dealt with promptly. It's important to avoid |
| For most homebuyers, pre-qualifying for a home loan | | | | last-minute surprises, which could lead to delays on |
| and signing a contract are major steps. But that's just | | | | closing. |
| the beginning of the journey towards home ownership. | | | | * Before closing, the smart homebuyer should order |
| And the rest of the trip can sometimes make or break | | | | inspections on the house and property to make sure |
| the deal. It's during this period that the lender is trying to | | | | that everything is in good shape and that no major |
| complete the financial package, the title company is | | | | repairs are required. Repairs could change the |
| doing the necessary research, surveys and appraisals | | | | agreed-upon price in the contract. The homebuyer |
| are put into motion, and the homebuyer orders home | | | | should be there with the inspector when it's done. |
| inspections and obtain homeowners insurance. | | | | Why? Because an inspector's report can be 10-12 |
| Anything that goes wrong at any of these stages | | | | pages long and full of technical jargon, so being there |
| could mean delays-or even a broken deal. | | | | to ask questions and get on-the-spot explanations can |
| As a homebuyer, you need to know that pre-qualifying | | | | really help you get a grip on the situation. The cost of |
| for a mortgage loan-and actually qualifying for it-are | | | | an inspection can vary; it depends on the location of |
| two very different things. You also need to know that | | | | the house, the size of the house, and what kind of |
| the difference between the two can definitely affect | | | | foundation it has. By the way, a termite inspection also |
| the closing date. To get pre-qualified, a homebuyer | | | | needs to be ordered by the homebuyer before the |
| must meet with the lender and have essential | | | | closing. If an inspector is not certified in this area, |
| information (Social Security number, income, etc. at | | | | another inspector will have to be hired. |
| hand). Then, after checking your credit score, income, | | | | * Homebuyers are responsible for getting |
| and employment, the mortgage lender writes up a | | | | homeowners insurance and have proof of it at closing. |
| document-based upon this preliminary information-that | | | | The Texas Department of Insurance says buyers |
| states what size of loan you might qualify for. | | | | should expect to pay about $400 to $1,000 a year for |
| Remember, this is not a final conclusion or a mortgage | | | | insurance-and possibly even more if the home is in a |
| loan approval-it's really only the lender's "educated | | | | flood zone. Most lenders will recommend an escrow |
| guess"-so don't start counting your chickens just yet! | | | | account where funds for insurance and property |
| As a matter of fact, many lenders these days are | | | | taxes are automatically set aside each month. |
| encouraging homebuyers to skip pre-qualification and | | | | * The lender will require hazard and liability insurance |
| go directly to qualification-before they start looking at | | | | for at least the amount of the loan. At the closing, you'll |
| homes-or, in many cases, even before the contract is | | | | be expected to pay the first year's premium for this |
| signed. | | | | insurance. |
| That's because the actual qualification process is | | | | * The homebuyer should schedule a final walk-through |
| much, much more extensive and in-depth. Typically, it | | | | of the house right before the closing. It would be a |
| involves giving the lender accurate information, W2 | | | | good idea to do the walk-through with your real estate |
| forms, bank statements, tax returns, and proof of | | | | agent. You want to make sure that the house is in the |
| income. All this goes through the lender's approval | | | | condition that you agreed upon in the contract. |
| process, which can take a fair amount of time. That's | | | | Remember, once the closing is done, you're the owner |
| because the up-to-date accuracy of the information | | | | of the house-as is. You no longer have any legal |
| you've given them is checked and double-checked at | | | | power to get the seller to fix anything, and the seller no |
| this time. So be sure of your facts and figures, | | | | longer has any legal responsibility to do so. |
| because any errors, inconsistencies, credit problems, or | | | | * A settlement agent-usually the title insurance |
| misinformation could definitely put a damper on things | | | | company-is the one who usually sets the time and |
| at this point. | | | | place of closing. |
| Things a homebuyer should know. Or expect. Or do. | | | | |