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CLOSING ON THE HOME
"Closing" refers to the
meeting where ownership of the property is
legally transferred to the buyer. It is a formal
meeting in which most parties involved in the
buying/selling process will attend.
Closing procedures are usually held at the title
company's office or lawyer's office. Your
closing officer coordinates the document signing
and the collection and disbursement of funds.
Your agent will generally be present at your
closing to read the documents on your behalf,
answer any questions, or help to resolve any
last minute or unexpected details that may come
up.
In order for the
closing to go smoothly, each party involved
should bring the necessary documentation and be
prepared to pay any related fees (closing
costs). There may be more than one
form of acceptable payment for your closing
costs so ask the closing officer which form of
payment will be required and to whom it should
be made out. Closing costs will generally total
an amount equal to 2 to 3 percent of the total
loan value not including down payment and the
buyer's escrow account.
Sellers sometimes pay
for a portion or all of the closing costs,
depending on local market conditions, terms of
the purchase contract, and the seller's cash and
timing considerations. Any such
concessions should be acknowledged in writing.
Most lenders will allow a credit from the seller
to the buyer for the non-recurring closing
costs. However, they usually won't allow a
credit that reduces the amount of the buyer's
down payment or any of the buyer's recurring
costs, such as expenses for fire insurance
premiums, PMI, or property taxes.
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