{"id":7687,"date":"2023-05-30T12:08:45","date_gmt":"2023-05-30T19:08:45","guid":{"rendered":"https:\/\/www.flyhomes.com\/blog\/?p=7687"},"modified":"2023-06-14T15:51:17","modified_gmt":"2023-06-14T22:51:17","slug":"the-six-steps-to-closing-on-a-house","status":"publish","type":"post","link":"https:\/\/flyhomes.com\/blog\/the-six-steps-to-closing-on-a-house\/","title":{"rendered":"6 Important Steps to Closing on a House Smoothly"},"content":{"rendered":"\n

Congratulations! If you\u2019re reading this, most likely, your offer has been accepted by the seller. <\/p>\n\n\n\n

Now comes the real estate closing process, which is a murky concept for most buyers. How long does it take to close on a house? What do you have to do and what does someone else do? Who\u2019s even involved?<\/strong><\/p>\n\n\n\n

1. Transfer your earnest money<\/h2>\n\n\n\n

Usually, the seller chooses an escrow company and opens an account with them before selling their home. You\u2019ll send your earnest money deposit to this account. Your deposit is generally three to five percent of the purchase price, and the amount will be in your contract with the seller. <\/p>\n\n\n\n

Your contract will also specify when you need to send your deposit to the escrow company. Expect it to be just a few days after your offer is accepted. It\u2019s very important that you do this step on time\u2014otherwise, you\u2019ll be in breach of contract and the seller can cancel the deal. In a crowded market, it\u2019s not uncommon for a seller to take the opportunity to walk away in favor of another buyer\u2019s offer.<\/p>\n\n\n\n

The escrow company will give you instructions about how to send the payment. These will likely include a choice of online transfer, sending a cashier\u2019s check yourself to the escrow\u2019s office, or having your bank wire it in. Remember that it will take time for your bank to send the wire, so make sure you work with them to hit your deadline. If you choose to do an online transfer, check if you have a daily max that you\u2019re allowed to transfer out of your bank account. <\/p>\n\n\n\n

Note that the escrow company is often also a title company. In addition to ensuring that the funds for the purchase are safe, their role is also to confirm that the property rights are clear and the home is sellable. <\/p>\n\n\n\n

2. Finalize your mortgage loan<\/h2>\n\n\n\n

Now it\u2019s time to shop around and compare quotes for loans and interest rates available from the lenders you may want to work with and choose one to lock in. Typically, you need to do this within about a week in order to stay on track to close. Making a decision on a rate you\u2019re comfortable with<\/strong><\/a> and even what type of lender<\/strong><\/a> to choose can be complicated. It\u2019s never too early in your homebuying journey to start to learn about mortgages<\/strong> <\/a>so you can make a confident decision when the time comes. <\/p>\n\n\n\n

Be aware that there are things you shouldn\u2019t do<\/strong><\/a> when applying for a mortgage, such as change jobs and apply for new credit. Also note that there are various ways to fund your down payment<\/strong><\/a>. <\/p>\n\n\n\n

After you choose a lender and loan type<\/strong><\/a>, the lender will lock in your interest rate. Locking in your rate secures it for a certain amount of time, typically 30 or 60 days, that allows you enough time to get through the rest of the closing process without any surprises on your loan. The lock protects your rate from future price changes, so if rates rise tomorrow, you still get your pricing from today. <\/p>\n\n\n\n

3. Complete your escrow forms<\/h2>\n\n\n\n

The title and escrow company will send you a form to fill out, requesting information to complete closing and prepare for the transfer of property rights.  They\u2019ll run a search to confirm that you are who you say you are and that you have no financial judgements against you. <\/p>\n\n\n\n

Generally, the company will want you to return these forms as soon as possible. However, you may not have all of the information yet, such as what insurance company you plan to use. You can fill out most of the form and let them know that you\u2019re still making those decisions. <\/p>\n\n\n\n

4. Buy your home insurance <\/h2>\n\n\n\n

Home insurance protects you financially in a variety of situations. Policies will vary, so it\u2019s smart to compare several plans from several different companies, just like with your mortgage. You can also choose to buy directly from an insurance company or through an agent who works with multiple companies. <\/p>\n\n\n\n

Generally, home insurance will protect you from losses due to: <\/p>\n\n\n\n