Escrow

After the initial agreement is in place, either a title company or an attorney will be designated as a closing agent to hold the deposit in escrow. They will also research the complete recorded history of the property to ensure that the title is free and clear of encumbrances by the date of closing and that all new encumbrances are properly added to the title. Some properties are subject to restrictions which limit various activities such as building or parking restrictions. There may be recorded easements and encroachments, which limit the rights to use your property.

Inspections

Once your offer is accepted by the seller, you will need to have a licensed property inspector inspect the property within the agreed upon timeframe. You may elect to have different inspectors inspect the property, if you wish to obtain professional opinions from inspectors who specialize in a specific area (ie. roof, HVAC, structure). I’m happy to recommend an inspector from my vast network of reliable vendors.

Appraisal and Lending

It is imperative that you keep in close communication with your lender, who will let us know when additional documents are needed to approve your loan application and fund your loan. If the agreement is conditional upon financing, then the property will be appraised by a licensed appraiser to determine the value for the lending institution, via a third party. This is done so that the lending institution can confirm their investment in your property is accurate. Appraisers are specialists in determining the value of properties, based on a combination of square footage measurements, building costs, recent sales of comparable properties, operating income, etc. When you are within two weeks of closing, you’ll want to check in with your lender to be sure the loan will go through smoothly and on time.

Property Insurance

If you are obtaining a loan, you will be required by your lender to purchase a certain amount of insurance on the property. The value will depend on the lending institution and the purchase price of the property.

Consider a higher deductible. Increasing your deductible by just a few hundred dollars can make a big difference in your premium.

Ask your insurance agent about discounts. You may be able get a lower premium if your home has safety features such as dead-bolt locks, smoke detectors, an alarm system, storm shutters or fire-retardant roofing materials. Insure your house, NOT the land under it. After a disaster, the land is still there. If you do not subtract the value of the land when deciding how much homeowner’s insurance to buy, you will pay more than you need to.