10+ Ways to Prepare for Final Settlement
Your Settlement Checklist
Appraisal is complete, all of the inspections are finished and your mortgage lender and title insurance company are making sure that all of the i’s are dotted and t’s are crossed for settlement. So long as everyone is prepared you should be in and out in under an hour. Here is a settlement checklist to keep you on track.
Before Settlement Day...
Decide how you'll take title.
One of the decisions that you’ll need to make prior to settlement is how to take title to your new property. The type of tenancy indicates how the ownership is legally structured and how the property's ownership will be handled after one of the tenants is gone. Review the 3 Types of Tenancy here. For legally married couples, “tenants by the entireties” offers the most comprehensive protection under the law.
Homeowner's Insurance
Make sure you obtain homeowner's insurance. If you're planning on paying your first year's homeowner's insurance premium at settlement, the settlement company will need a copy of the invoice. If you've already paid it in advance, you'll need to bring a paid receipt.
Utilities, Cable, Internet & Phone
Unless your utilities and waste removal are provided by the local municipality, you’ll want to set-up a new account prior to closing to avoid any interruption in service. If service is provided by the local municipality, your title company will provide them with your contact information for the new account. You’ll also want to schedule an installation date for your cable, internet & phone service.
Funds for closing
Make a trip to the bank for the funds that you’ll need at closing. Unless you’ve made arrangements to wire the funds to the title company ahead of time, you’ll need a certified check or a cashier’s check payable to the title company handling your closing. If it turns out that you brought too much money, the title company will write you a check for the difference.
Schedule a walk through
Contact your real estate agent to schedule your pre-settlement walk through. This is your opportunity to inspect the final condition of the property and make sure nothing has changed since your last visit. Make sure any agreed upon repairs have been made and that no trash or unwanted items have been left behind.
The Day of Settlement...
Who Attends Settlement
A representative from the title company will attend and conduct the closing. Typically, the title company will walk the buyer(s) through all of the mortgage documents. If the buyer(s) are represented by a real estate agent the agent typically attends and in some cases their lender will attend. The seller(s) and/or their real estate agent will likely be in attendance as well. Barring any last minute issues that cause a delay, settlement should be complete in under an hour.
Bring proper ID
Each borrower should be bring a government issued photo ID to settlement such as a driver’s license, passport, or military ID.
Power of Attorney
If you’re signing for someone using a POWER OF ATTORNEY (POA), bring the original to closing. If one or more of the borrowers/buyers is unable to attend closing and your lender has authorized the use of a POA, you must provide the original signed and notarized document to the title company.
Bring unpaid tax bill (seller only)
Bring any unpaid real estate tax bills to settlement. All outstanding real estate tax bills will be paid current at closing. Although there are typically discounts if the bill is paid within a certain time frame, the bill is considered due and payable as soon as it’s been issued.
Bring your checkbook
Sometimes there will be minor adjustments for taxes, utilities or other miscellaneous items at the settlement table. Many title companies will accept a personal check to cover a small adjustment.
Copies for your records
Be sure to leave closing with a copy of your first payment letter for your new loan along with the following 5 documents. Click to view examples of these forms.
Don't forget your keys
Be sure to get all keys, garage door openers and alarm codes for the property. Transferable utility contracts or warranties on any major appliances should be exchanged as well.