Real estate is likely the most expensive purchase you will ever make. After you found the house of your dreams or commercial property that meets your needs, you have to go through a lengthy closing process.
Although the closing process may seem complicated, understanding the steps you have to take can alleviate your stress. This is what you should know.
Address the money and insurance
In many cases, you should have acquired preapproval on a mortgage, but if not, you should do so after the buyer accepts your offer. Then, you need to open an escrow account with a third-party company that will hold all your documents and money until the sale is final.
Next, you should purchase title insurance and have a title search done to ensure that the property belongs to the seller and has no other liens against it. If you find any title issues, the seller needs to solve them.
Inspect the property
Your next step is to get a complete physical home inspection and pest inspection. You should also walk through the property and look for any red flags.
Negotiate
Once you have all the details about the property, you can negotiate. You may have already agreed to your closing costs, but you can also negotiate the purchase price if you have to make repairs or get the seller to fix items you found during the inspection process. You will also likely negotiate and lock in your financing interest rate.
Signing the paperwork
Before you sign any contracts, you can seek legal advice or a review of the paperwork. Read everything you sign and ask for clarification if you do not understand something. Check your interest rate, terms, closing costs and any fees carefully.
You should expect a 30-45-day closing period for a home.