The Pre-Closing
This is where you wrap up all the details. You want to go through all the details
to protect your new investment. Following are the items that must be completed
prior to the close of escrow:
Obtaining the Mortgage - If a condominium purchase is going
to fall through, financing is most likely where it will happen. You need to
ensure you are approved for your loan prior to closing. You will find details
about this process in our mortgage section.
Closing Costs - Closing costs vary from property to property.
But the law requires that the lender provide you with a good faith estimate
when you apply for a loan.
Appraisal - Part of the loan process is getting an appraisal
of the property. Often the lending institution will send an appraiser whose
responsibility it is to make and educated opinion on the value of the property.
At the end of the process you receive an appraisal report which is the estimate
in writing including the factual basis and the method of reasoning used to
form the estimate.
Inspection - A home inspection is generally a contingency
in the buyer’s contract. If you are getting funding from a lender they
require it prior to funding the loan. It is in your best interest to hire
a qualified home inspector to carefully look over the property. Either you
or your agent should tag along with the inspector. At the end of the inspection
you will receive an inspection report.
Title search - To ensure that the title of the property
is free and clear the lending institution requires a title search before issuing
the loan. The search is the process of researching the current state of title
by a title company. The title company issues a title report identifying the
current owner of record, the estate under which the title is held and all
the encumbrances of record affecting title. This forms the factual basis from
which the title company will offer title insurance. If there are any liens
or lawsuits the seller must clear them up prior to closing.
Insurance - Before issuing a loan a lending institution
will require you obtain homeowners insurance. As a condo owner, you will
obtain a certificate of insurance,
which covers your unit and/or your personal property within the unit depending
on how the policy is written.
Walk-Through - You are entitled to a final walk-through
of the property prior to signing the closing papers. We highly recommend you
do this because it provides the final opportunity to ensure all of the items
for which the sale is contingent have been completed. Schedule your walk through
as close to the closing date a possible, preferable after the seller has moved
out.
Move out Date - To protect your investment, you want the
premises to be vacant upon closing. To ensure that this happens we recommend
you make it a contingency to close and establish a firm move out date from
the seller.
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