Closing Week Checklist

5 Things That Can Make or Break a Closing

Closing on a property culminates weeks or even months of anticipation and preparation. It's the moment when ownership officially transfers from seller to buyer, but it's also a critical juncture where several factors can determine the smoothness of the process. Here are five crucial elements that can make or break a closing:

1. Survey: Know Your Property Inside Out

The property survey is one of the most essential documents in a real estate transaction. It outlines the boundaries, improvements, and potential encroachments on the land. Not having a survey might seem like a cost-saving measure, but it could lead to expensive disputes later on. Understanding where your property lines lie and ensuring neighbors' structures don't encroach onto your land can prevent future headaches. Investing in a survey is like buying peace of mind—priceless in the long run.

2. Watch Your Spending: Don't Rock the Boat

In the days leading up to closing, lenders closely monitor your financial activity, particularly your credit usage. Buying a new car, splurging on a vacation, or making other major purchases can impact your credit score and jeopardize your loan approval. It's crucial to maintain financial stability until after the closing. Delay those big-ticket purchases until you've secured the keys to your new home.

3. Scrutinize the Closing Statement: Transparency Is Key

The closing statement details all financial transactions related to the purchase, including fees, taxes, and credits. Reviewing this document thoroughly upon receipt can prevent surprises and ensure that everything aligns with your expectations. Any changes to the closing statement require lender approval, underscoring the importance of a meticulous, line-by-line examination. Keep a signed copy of the statement for at least five years after you sell the house to satisfy IRS requirements. It’s not just a record but also a safeguard in the event of an audit or a financial discrepancy.

4. Secure Wire Transfers: Guard Against Fraud

Wire fraud is a significant concern in real estate transactions. The closing attorney will provide instructions for wiring funds securely. Never trust wire transfer instructions sent via email from anyone other than the closing attorney. Take these instructions to your bank to ensure the funds are sent securely. This simple precaution can protect you from falling victim to fraudulent schemes that target real estate transactions.

5. Valid Photo ID: Don't Forget the Basics

A government-issued photo ID is a non-negotiable requirement at closing. Ensure your ID is current and hasn't expired before the closing appointment. It's a small but essential detail; overlooking it could delay or even derail the closing process.

Conclusion

Closing on a home involves navigating a maze of paperwork, financial transactions, and legalities. These five elements—survey, economic prudence, thorough review of documents, secure wire transfers, and valid ID—are pivotal in ensuring a successful closing. By paying attention to these details, you can minimize stress, avoid potential pitfalls, and confidently step into your new chapter of homeownership. Preparation and diligence are your best allies in ensuring the closing day is a triumph rather than a trial.

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