For many people, buying a home is the largest financial transaction they will make during their life. There are several steps you can take in advance to increase the likelihood that your real estate closing will go well and does not have to be canceled and rescheduled. To protect your rights and best interests before you sign a contract at the closing, it is critical to ask an experienced Houston real estate attorney to review the contract.
How to Ensure a Smooth Real Estate Closing: The following key areas help ensure accuracy prior to the closing date.
Get Conditional Approval before Making an Offer: Loan pre-approval creates a realistic expectation of the offer price range. Buyers who have been pre-approved by a lender are usually able to finalize their loan application faster than those who have not been pre-qualified.
Review Contract Documents: If the information on any document is found to be incorrect, even a simple misspelling, it can delay or even necessitate the rescheduling of a closing. Ask to see all paperwork in advance and check and recheck every piece of information until it is verified.
Down Payment: Transfer the down payment to the closing agent a few days in advance to eliminate the possibility of a last-minute problem at the bank. An alternative to transferring the funds is to bring a certified or cashier’s check to the closing.
Expedite Loan Documents: If the closing agent doesn’t receive the loan documents in time, your closing may have to be rescheduled. To avoid delay, Buyers should also assemble their bank statements, pay stubs, tax returns and other documents to fast track their loan approval. Most lenders post checklists online. Ask both the closing agent and the lender in advance if they have everything they need, including bank statements and tax returns. Lenders frequently ask for additional information at the last minute. Call the day before your closing to confirm that everything is ready for the closing date. On the day of closing, verify with your closing agent that the loan documents have been received. If not, ask what is causing the delay and if there is anything you can do to help speed things up.
Title Trouble: To avoid last minute title trouble, get your own copy of the preliminary title report (completed after escrow opens) to review. Your title company will inform you of any problems they find during the title search. Be sure to purchase title insurance to protect yourself against title defects. If a title dispute arises during a sale, the title insurance company may be responsible for paying specified legal damages, depending on the policy.
Title Commitment Insurance: Is issued prior to closing and demonstrates the title company’s willingness to issue title insurance under conditional terms. It further provides coverage for the property. Conditional terms will list potential issues, exceptions, and exclusions covered within the terms. It is essential to review any items listed with the title agent and confer with the policy so there are no surprises down the road. The terms available for negotiation include property descriptions in Schedule A, exceptions listed in Schedule B, and the Exclusions. If an item is “excepted” on the marked-up title commitment, it will appear on the final policy and the owner’s title and bank’s mortgage will be subject to the exception (example, a utility easement to PPL).
Title Insurance: Protects you from financial loss due to defects in the title to real estate. Protection extends to claims filed prior to the purchase of the property. Texas does not require perspective buyers to purchase title commitment or title insurance. However, a lender will require a loan policy of title insurance. Should you purchase title insurance, it will remain in effect for the duration of ownership of the land, including the owner’s heirs. However, if you opt for the lender’s loan policy, you are only covered for the duration of the loan. There are three things that should be done before closing: 1) Determine what endorsements the bank will require; 2) Review the title commitment; and 3) Ask for copies of the exceptions and review them.
Final Walk-Through Problems: Make sure any repairs the seller has agreed to make are completed before closing. Do the final walk-through inspection the day before closing, or sooner. If you find any problems with the home during your final walk-through, tell your agent immediately so he or she can work towards a solution.
Consult a Real Estate Attorney: Consulting a real estate attorney can take care of many of these pre-closing tasks for you and coordinate parties and documents so that the closing can go smoothly.
Conclusion: Prior to proceeding to a real estate closing, it is important you prepared properly for the meeting to avoid delays. It is advisable to review all documents with an experienced attorney to ensure you are covered in the event of a claim against your title.
Filippov Law Group, PLLC provides a full range of services in the area of real estate law, with a primary focus on protecting the rights of property owners engaged in buying or selling residential or commercial property. We represent clients in matters related to the purchase and sale of real estate and litigation, including:
| Purchase and Sale of Real Estate | Real Estate and Litigation Services |
| • Drafting and negotiating real estate contracts;
• Negotiations and contract executions; • General consultation, including the interpretation of various real estate purchase contracts and those promulgated by the Texas Real Estate Commission; • Representation of individuals and entities at the closing table to assist in the review of closing documents prepared by title companies; and • Preparation of documents, including deed for condominium projects, special warranty deeds, purchase agreements, deeds with vendor liens, deeds of trust, notes, and lien releases, and general warranty deeds. |
• Sales and purchase agreements of residential and commercial property;
• Subdivision development law; • Fraud litigation; • Landlord-tenant dispute resolution; • Construction defect litigation; • Title and document review, attend closings on behalf of either buyer or seller; • Commercial property lease agreements; • Title transfers resulting from the probate of wills or the distributions of various types of trusts; • Letters of Intent. |
There are many factors that can affect and delay your real estate closing. Have an experienced attorney review your documents today to avoid any undue delays.
The attorneys at FILIPPOV LAW GROUP, PLLC. have the experience and answers to the questions you face regarding real estate closing questions and issues. Contact us today for a no-obligation assessment of your overall legal needs. Call us at 832-900-2177 or email our managing member at [email protected] to schedule your appointment.
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