Closing is also known as settlement and is the legal transfer of ownership of property. Normally, but not all the time, possession will be transferred during closing. There are instances when a seller might ask to close the sale but still retain possession, and then pay rent to the buyer until such a time that they vacate the property. When considering real estate closing Virginia residents need to know what it involves.
One of the first things will be to stay organized. The process usually involves a number of steps but it is the duty of an agent to make the steps easier. When you deal with agents, they will offer guidance through the whole process. It is important to understand the contingencies. Contingencies refer to conditions which are included with offers which need to be fulfilled before the deal is closed. For instance, a buyer could submit an offer with home inspection contingency.
There is earnest money that parties involved will need to clearly understand. It refers to the money that is delivered one to three days after acceptance of the offer by a seller. It is usually delivered to an escrow company which holds it for the entire transaction period.
It can also be referred to as a good faith deposit and ranges between 1 to 3 percent of the sales price of the home. It is applied towards closing costs of buyers. In case the buyer decides to get out of the deal for what is not covered by the contingency, they are supposed to forfeit the earnest money.
There is then scheduling of a home inspection. This is unless of course they waived home inspection contingency or if the home was inspected before the offer was made. Inspectors will give the buyer accurate pictures of the condition of the home. Any major issues will be identified so that negotiations can be done more confidently.
Home appraisal will be a very important aspect too. Unless in cases when a buyer pays in cash, they will be offered mortgage. The lender will ask for appraisal of the home. If the home does not appraise, which would mean the bank does not think it is worth the offer, it is the buyer that decides what to do. Home appraisal contingencies allow buyers to opt out of deals at that point. They could also renegotiate new prices that both parties are comfortable with.
Title insurance offers protection against losses in case a problem arises with the title after the home is purchased. For the majority of purchases, there will be two parties that require title insurance. They are the home buyer and lender. In case a buyer has financing contingency and is not able to get a loan for the purchase, they are free to get out of the purchase and get back the earnest money.
Closing usually happens at the office of a title company. It is their duty to confirm who the current legal owner of the property is. Also, they reveal any liens, mortgages or unpaid taxes. If there are any restrictions that might affect the sale, they will be identified.
One of the first things will be to stay organized. The process usually involves a number of steps but it is the duty of an agent to make the steps easier. When you deal with agents, they will offer guidance through the whole process. It is important to understand the contingencies. Contingencies refer to conditions which are included with offers which need to be fulfilled before the deal is closed. For instance, a buyer could submit an offer with home inspection contingency.
There is earnest money that parties involved will need to clearly understand. It refers to the money that is delivered one to three days after acceptance of the offer by a seller. It is usually delivered to an escrow company which holds it for the entire transaction period.
It can also be referred to as a good faith deposit and ranges between 1 to 3 percent of the sales price of the home. It is applied towards closing costs of buyers. In case the buyer decides to get out of the deal for what is not covered by the contingency, they are supposed to forfeit the earnest money.
There is then scheduling of a home inspection. This is unless of course they waived home inspection contingency or if the home was inspected before the offer was made. Inspectors will give the buyer accurate pictures of the condition of the home. Any major issues will be identified so that negotiations can be done more confidently.
Home appraisal will be a very important aspect too. Unless in cases when a buyer pays in cash, they will be offered mortgage. The lender will ask for appraisal of the home. If the home does not appraise, which would mean the bank does not think it is worth the offer, it is the buyer that decides what to do. Home appraisal contingencies allow buyers to opt out of deals at that point. They could also renegotiate new prices that both parties are comfortable with.
Title insurance offers protection against losses in case a problem arises with the title after the home is purchased. For the majority of purchases, there will be two parties that require title insurance. They are the home buyer and lender. In case a buyer has financing contingency and is not able to get a loan for the purchase, they are free to get out of the purchase and get back the earnest money.
Closing usually happens at the office of a title company. It is their duty to confirm who the current legal owner of the property is. Also, they reveal any liens, mortgages or unpaid taxes. If there are any restrictions that might affect the sale, they will be identified.
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