Celebrate! Your months and weeks and days of finding a new home to buy is about over. You’ve slogged through the process of getting financing, Realtor-selecting, house shopping, making an offer, dealing with home inspections, and living with the stress all of the above brings.
All that is ahead of you is the Closing. Another term for closing costs is settlement costs- all the fees incurred while ‘settling’ the final home purchase.
You bring the money, and the house is yours…. Right? True, but it’s wise to understand what is happening, and what those extra dollars are going to be used for.
Here’s a quick list of Truckee & Tahoe closing costs, fees and terms to be aware of:
• Title Insurance Premium: Fee paid by an individual to insure he has a marketable (think valid) title. If a bank is lending you the money, they will require title insurance to insure their lien position.
• Escrow Fees: The title company’s fees for their services preparing all the documents needed to complete a real estate transaction.
• Loan Fees: Lender fees that accumulate with the processing of a new loan. A few of these fees include points, origination fee and credit report.
• Transfer and Assumption Charges: Fees a lender charges to allow a new purchaser to assume an existing loan.
• Real Estate Commission: Fees paid to real estate brokers for services completed by listing, showing, selling, and completing the transfer of a property.
• Recording Fees: Amount charged by a county recorder’s office for recording the document of a real estate transaction.
• Additional settlement charges include assessed taxes, insurance impounds, interest/tax prorations, and termite inspection fees.
FYI- Title Insurance Quick Tips:
• You can benefit by a 20% savings in title fees if your future home has had a title insurance policy issued in the past five years.
• Are you an investor and planning to resell within 2 years? Pay an additional 10% of the title fee at escrow’s close. Sell within a 2-year period and 100% of the original fee will be credited.
You’ve gone to the bank to get the check that covers your closing costs. Plan to arrive at the title company a bit early if possible- it’s easier to handle any last-second surprises.
The title (or escrow) agent will meet with you, the seller, and connected realtors in a conference room. He/she will review and explain your closing statement in detail. Feel free to ask the title agent or your realtor for clarification or more details if there is an area you don’t understand.
Once both the buyer and seller have gone through the closing costs summary, you hand over your check that covers your total portion of the costs to the title agent. If the sellers have money due they also deliver their check. There’s a couple more steps, and- tada! You are now the proud owner of your home. Go out and celebrate!