6 Things to Do Before Closing on a Home
Hooray! The home seller just accepted your offer! All of the time and effort you put into finding the perfect home has finally paid off. The only problem? You’re not out of the woods just yet. Until you walk out of your closing with the keys in hand, your new home isn’t guaranteed to be yours.
The problem with buying an existing home is that anything can happen between the offer acceptance and the closing, some of which can even cause you to lose the deal entirely. This is why it is so important to make sure you do the following six things before closing.
#1: You Need to Stay Qualified
Getting pre-qualified for a mortgage isn’t a guarantee that you’ll be approved for one. This is because your credit at the time of your pre-qualification might be different from your credit at the time of your closing. In order to ensure you get the loan you want, you need to maintain your credit so you can stay qualified all the way through the closing. So, don’t open up any new lines of credit; don’t use any more of your existing credit; and don’t miss any credit payments.
#2: Withdraw or Transfer Funds With Caution
Lenders don’t like it when applicants withdraw or transfer funds before closing because it makes them feel that there might be a financial issue going on. So, if you have to do it, make sure you have a record of the transaction and have a written explanation for its purpose because the lender will want to see both.
#3: Buy a Homeowner’s Policy
Every lender is going to want you to have an active homeowner’s policy in place before closing day. In most cases, the lender will verify your coverage a day prior to closing and in some cases, they may even require you to pay your first year’s premiums in advance. This is usually done by setting up an escrow account.
#4: Document Any Large Bank Deposits
Making a sizable deposit into your bank probably won’t hurt your loan chances, but odds are your lender will want to know where it came from. So, tell your lender about the deposit and provide them with any documents relating to the deposit.
#5: Wait For Your HUD-1 Statement Before Getting a Cashier’s Check for Closing
Your lender will give you an estimate as to how much you can expect your closing costs to be. But, don’t take this number as gospel. Wait until you receive your HUD-1 statement before going to the bank for your cashier’s check for closing. The HUD-1 statement will give you a list of the finalized fees you will be responsible for paying at closing.
#6: Get a Cashier’s Check for the Closing Costs
Your closing costs need to be paid by cashier’s check. And, the check needs to be made out to the title or escrow company that’s handling the closing process. The amount of the cashier’s check needs to cover the exact amount of your closing costs, so as stated, wait until you receive the HUD-1 statement before obtaining your check for closing.
Trinity’s Custom Homes Can Design and Build Your Beautiful New Home
One of the advantages of buying a brand new home is that you don’t have to worry about the seller backing out at the last minute. As you can see above, you already have your hands full prior to closing, but when you’re dealing with a seller, there’s always an added level of risk. By choosing to have your home custom built from the ground up, you cut your worries in half.
Call Trinity Custom Homes today at 888-818-0278 to schedule a consultation with one of our experienced custom home builders. We have builders in five southeastern states, so no matter where you’re located, we’ll be able to help you. When you’re ready to get started, give us a call and let us show you what we can do.