Process and Paperwork
Right At Home
Daily: Finding It: House-Hunting
Process and Paperwork: Appraisal, Inspection,
Lien Searches, Title Insurance, Closing Fees
By Barbara B. Buchholz for Right at Home Daily
Getting your offer accepted is half the battle
in completing your home purchase.
First and foremost, you want to make sure the
property is worth what you’re willing to pay for it. Your lender will
send out an appraiser to check out the property and compare it to similar properties
that have recently sold in the neighborhood.
While
the home is being appraised, you’ll need to hire a professional
home inspector to check out the physical condition of the home. Even though
you and your agent may have toured the property several times, looked in the
closets, attic and basement and even turned on the appliances, savvy home buyers
use an inspector to catch those harder to detect items, like loose roof shingles.
A reputable inspector or structural engineer
will check your air conditioning and heating systems, electrical wiring, plumbing
and other systems. He or she should get on the roof, and go into the attic,
basement and crawl spaces. The inspector should look for evidence of moisture,
sagging walls, and other signs of structural problems.
If the inspector finds something amiss or if
the homeowner has had a significant problem in the past, such as a leaky roof,
you may want to bring in a second expert such as a roofing contractor or pest
inspector to further identify what needs to be done to correct the problem.
You, or your attorney, should do a lien search
to be sure the property is lien-free. If a house has a lien attached to it,
it forms what is known as a "cloud on the title." You will not receive
clear title to the home until these liens have been taken care of by you or
the owner.
Of course, you’ll need to purchase title
insurance. You need to know that there are two forms of title insurance, which
offer important protections: owner's and lender's coverage. If you’re
paying for lender’s coverage, the title insurance is solely for your lender’s
benefit. You should also purchase an owner’s policy, for an amount equal
to the purchase price of the home.
Some well-respected companies are now offering
deep discounts to consumers who call and ask for them. Some real estate attorneys
will pass on the savings they can secure (because of the volume of business
they do with the title company) to the consumer. In most states, the price of
title insurance is regulated, so discounts are not available.
Consult your attorney or escrow agent for more details.
TAKE IT AND RUN
Just because you’re told that everything is "fine"
with your closing doesn’t mean it is.
1. Stay on top of the paperwork in the transaction.
2. Make sure you provide everything your lender
asks for–and keep a copy for yourself. Stay in frequent contact with your
lender until the loan has final approval.
3. Stay in touch with your agent to make sure
the seller has completed all necessary work.
