Real Estate: Congratulation! It's
closing time
At the closing, all the parties (you, seller, lender,
attorneys, title company and the real-estate agent) come together to
complete a real estate deal. Before you can walk away with the keys to your
new home, you'll have to write checks, sign quite a bit of documents. Your
lender will provide you with a closing statement that itemizes all the
charges (points, filing fees, mortgage tax, attorney's fees and prorated
real estate taxes to the seller) you'll have to pay at the settlement.
Below are legal documents and terms you need to know.
- The mortgage - This is a standard legal
document that describes your agreement with the lender, the property
itself and the amount of the mortgage.
- Truth-in-Lending Statement - This document
shows the real cost of the loan which includes the amount of the loan,
finance charge for the life of the loan and the annual percentage rate
(APR). APR is the actual interest rate you'll pay on the mortgage,
including fees and points.
- Certificate of title - A written opinion of the
quality of a person's ownership of property, issued by a lawyer or a
title insurance company after a search of the title records has been
conducted. A title search, or examination of property records will
insure that the seller holds the title and has the right to transfer it
to you. So that there are no claims against the property that might
jeopardize your ownership of the house.
- Title insurance - This insurance guarantees
what's in the title search. In most cases, if you’re taking a mortgage to
buy the property, the lender will require you to arrange title insurance
to protect its interest until the full amount of the loan has been
repaid. You may also arrange for your own title insurance (also known as
fee insurance) to protect you from losing your property if your ownership
is contested.
- Proof of homeowner's insurance - Homeowner's
insurance protects your investment in your home by promising to repay
some or all of the cost of repairing or replacing the home if it is
damaged or destroyed. The premium, or bill, you pay for this protection
varies based on the value of your home, its location, the extent of the
coverage, and the firm providing the insurance. If you have a mortgage on
your home, the lender will require that you have at least enough
insurance to cover the amount you owe on the loan.
- Mortgage note - This document states your
promise to repay the mortgage. It indicates the amount and terms of the
loan, and what the lender can do if you fail to make payments or pay
late.
- Certificate of occupancy - Document issued by
the local municipality indicating that the house is suitable for
occupation. Generally confirms that the house complies with local
building, safety and health by-laws.
Related Articles:
Next -->>
Tapping your home equity: Refinancing & Home
Equity Loans
Table of Contents:
-
Should
you buy a home?
Renting vs. Buying:
-
Steps to buying a home
-
What is a
Mortgage and do you needed?
-
Different types of Mortgages
-
More Mortgage
Choices
-
0 to 5% down
with FHA and VA loans?
-
Cosigning: The Pitfalls
-
Qualifying for a
Mortgage
-
How much of a
mortgage and a house can you afford?
-
Finding a home with FSBOs & Real Estate Agents.
- It's closing
time: Title and the keys please!
-
Tapping your home
equity: Refinancing
-
Tapping your home equity: Home Equity Loans
-
Frequently
Asked Questions (FAQs) on Real Estate & Mortgages
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