| "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. |
