Check List For A Successful Closing

1.       Importance Of The Real Estate contract:

a.        The Executed Offer to Purchase and Contract dictates the closing.

b.       Avoid problems—be precise

                                                                           i.      Improper legal description may lead to invalidation of offer to purchase {remember the Statue of  Frauds}

                                                                          ii.      improperly worded contingencies may cause closing difficulties or lead to invalidation of the offer to purchase.

2.       Communication

a.        Contact  attorney as soon as property is under contract to allow attorney opportunity to prepare for upcoming closing. Upon initial contact with attorney, determine who’s taking care of what –avoid adversarial relationship

b.       Closing information sheets and/or Listing /Selling Agent Checklists are attached for organizational assistance

                                                                           i.      Use closing information sheets {attached} to record pertinent information, i.e., previous loan number and payoff information or repair work and costs

                                                                          ii.      Communicate as much as information as possible via Listing/Selling Agent checklists {attached}—these can assist the attorney in preperation of closing statements and avoid several telephone calls. If at all information is unavailable, communicate as much as possible as soon as possible. Early information allows attorney to be able to provide a closing statement less one or two items which can be added when available.

                                                                        iii.      Communicate the Sellers mortgage account number and lender information as soon as possible. Many out of state lenders will not provide payoff information in less than 10 business days. Delays in providing this information to the closing attorney may result in delayed closing.

                                                                        iv.      Contact attorney or his staff immediately upon loan approval so attorney can order survey and immediately perform title search.

c.         If fax machine available, fax closing information sheet or Listing/Selling Agent Checklists to attorney. Fax machines have become a necessity in this trade and very useful especially if you’ve been receiving a busy signal when trying to contact the attorney.

d.       If attorney is difficult to reach, ask receptionist if attorney’s office has a paralegal/secretary responsible for preparation of closing packages. This person is often very useful in assisting you in conveying information to the closing attorney and this person can often respond to your needs immediately.

3.       Title Insurance

a.        Obtain previous policy information, as soon as contract is signed, and convey to closing attorney. If you are listing a property, it would be a good idea to locate prior title policy information at the time you take the listing and save it in your file in order to prepare for upcoming closing.

b.       Bringdowns from prior title policies save attorney time [shorten title search period] and save buyer’s money [reissue rates are less expensive than a new policy]

c.        Saving time and money wins buyer loyalty-reaching closing table faster appreciated by both buyer and seller.

4.       Survey

a.        Obtain previous survey information as soon as contract is signed and convey to closing attorney. If you are listing a property, it would be a good idea to locate prior survey information at the time you take the listing and save it in your file in order to prepare for upcoming closing.

b.       Updates on previous surveys save time and money. If the surveyor is still doing business he can often update his prior survey work quickly and may offer a discounted price for an update of his previous work. Further, an update can often be completed much quicker by the survey and not delay an upcoming closing.

c.        Saving time and money wins buyer loyalty—reaching closing table faster appreciated by both buyer and seller.

5.       Access/Road Maintenance

a.        Determine immediately whether access to property is over private easement. {This can be accomplished by contacting Dept. of Transportation or Municipality}. If so, verify whether there is a recorded document conveying access to property. This can often be accomplished by notifying closing attorney of potential problem prior to loan approval with instructions to look for potential problem during title search.

b.       If access is over private easement, also determine if there is a recorded road maintenance agreement {universal lender requirement} If no recorded maintenance agreement exists, contact the closing attorney prior to loan approval and inform him that this may be a requirement of the upcoming closing in order to avoid unnecessary delays of a potential closing.

6.        Homeowners Insurance

Explain to buyer at time of contract is signed that hazard insurance will be required and find out what company/agent buyer intends to use [avoids last minute rush to obtain insurance binder or policy]. Please note that if the lender will be escrowing for insurance it is necessity that this information be provided to the closing attorney in order for said attorney to complete the closing statement. Don’t rely on insurance agent to get binder or policy to closing attorney prior to closing.

7.       Pest Control

a.        The contract dictates who pays the cost of the pest report and repairs

b.       Pest report may indicate prior or current structural damage; if so, a letter from a general contractor licensed in the state of North Carolina indicating that no structural damage has occurred may be required by the new lender.

8.        Avoid Raising New Issues At The Closing Table

Do not raise new issues at the closing table. The closing of the transaction is not the time to present new issues or negotiate old ones. Deal with all issues regarding  the closing as soon as they are raised in order to avoid not crossing the finish line, a smooth closing will result. [ie. In the event that the seller intends to retain possession of the premises post closing , negotiate all terms of said delayed possession prior to the closing table].

9.       Attorney’s Fee

a.        Have the Buyer contact the closing attorney at the time of execution of the Offer to purchase to discuss attorneys fees. Fees may vary depending on many factors such as length of title search, whether or not transaction involves a loan or a cash deal, amount of attorney’s risk {purchase price}, whether chain of title is out of an estate or other factors that may increase the amount of time involved.

b.       Additional expenses may be incurred to remove title defects or to cover expenses such as express mail charges, long distance phone calls, excessive copies, faxes, etc.

10.     Conclusion

By Obtaining and effectively communicating as much information as early as possible, the realtor and attorney can enjoy a smooth closing of the present transaction as soon as possible and move on to the next one.