8 Steps of Settlement AFTER the contract is signed

HERE'S WHAT HAPPENS NEXT . . .THE 8 STEPS TO FOLLOW AFTER SIGNING THE CONTRACT:

Step 1 - Home Inspection
We will arrange a time to return to the property for a home inspection. Typically, this has to be done within a few days after the contract has been signed. A professionally licensed home inspector will accompany you through the home and point out problems or deficiencies if they exist. The seller is then notified of any problems. Usually he/she will agree to the repairs. However, if he/she does not agree to make the repairs, you have the option of voiding the contract.

Step 2 - Lender Appointment
Hopefully you have been pre-approved before you started looking, but if not set up an appointment with your lender and be prepared to provide him with the following items:
- W-2 forms or signed 1040 tax forms for the last 2 years
- Copies of the last 2 months bank statements (current and consecutive)
- Copies of the most current and consecutive pay stubs for the last 30 days
- An appraisal fee of $400-425
- The credit report fee of $55-58

Your Home Loan Specialist will go over the loan process and set your loan in motion. He/she will order the appraisal and credit report within a few days.

Step 3 - Selection of Title and Escrow Company
We will choose a settlement company for you and provide them with the necessary paperwork. The Escrow has the responsibility of making your transaction legal. Before settlement, they do the title work, examine the survey, prepare mortgage documents, and prepare the real estate closing documents. After settlement, they prepare packages for mortgage lenders, accounting and title insurance, file documents with the county, and release escrows.

Step 4 - Homeowners Insurance
Proof of homeowners insurance is required at settlement. You may choose an insurance company. We will provide a referral for a reputable insurance company if you have not selected one.

Step 5 - Transfer Utilities

Step 6 -Obtain Certified Funds for Settlement
The title company should be able to tell you a few days before settlement the exact amount due. Bring either a cashier's check or get instructions for wire transferring the money. Personal checks are not acceptable.

Step 7 - Conduct Walk-thru of Home
The walk-thru is done to make sure the discrepancies from home inspection have been completed.

Step 8 - Settlement
Title is transferred, mortgage documents are signed, and funds are disbursed according to local practice.

GLOSSARY OF TERMS

Appraisal - an expert judgment of the value or worth of a property.

Contingency - a condition in a contract that must be met for the contract to be binding.

Contract - binding legal agreement between two or more parties that delineates the conditions for the exchange of value (for example: money exchanged for title to property).

Deed - legal document that formally conveys ownership of property from the seller to the
buyer.

Down Payment - percentage of the purchase price that the buyer must pay in cash and may not borrow from the lender.

Escrow - a fund or account held by a third party custodian until conditions of the contract are met.

Home Inspection Report - prepared by a qualified inspector, it evaluates a property's structure and mechanical systems.

Mortgage - security claim by a lender against the property until debt is paid.

Settlement - all financial transactions required to make the contract final.

Title - document that indicates ownership of a specific property.

Title Insurance - protects against loss from legal defects in the title.

Title Search - detailed examination of the entire document history of a property title to make sure there are no legal encumbrances

Home | Buyers | Sellers | Contact Us

Team Gale - RE/MAX Metro - Salt Lake City, Utah
801-205-3500 - Toll Free 877-898-9502 - fax 801-277-3510