Tips for House Buyers to Prepare For Closing
- Adam Garrett
- Jul 11, 2023
- 16 min read
Updated: Jul 5
In this article, I'd like to share some of the important preparations to make & expectations to have prior to closing.
Before Closing:
Get Secured Funds Ready in Advance
Connect with your closing company about certified funds needed on or before closing day. These sometimes need additional time based on bank policies regarding the withdrawal of certified funds, such as max wire amounts from your account per day. While slight changes can often be accommodated by personal checks, the vast majority of this amount should be in certified funds.
Schedule Final Walk Through Inspection
You should perform a final walk-through inspection prior to closing. In the final walk through inspection, your primary official goals are:
Ensure that no damage has occurred since the contract (if no home inspection occurred) or the home inspection (if the contract was contingent on home inspection).
Ensure that any home inspection requests or other inspection requests agreed to by the seller have been taken care of.
Ensure that the contract has been followed (i.e. items to convey & removal of personal property).
In the event of extensive repairs required contractually, this can occur as much as 5 days prior to closing. If no repairs are requested/needed at any point in time, the day prior to closing is typically ideal to minimize the chances of something happening to the house in between the walk-through and the closing. Here are more details on timing.
Walk through inspections with me typically take between 1.5-3 hrs, depending on circumstances like size of the home/lot, number of repairs that have occurred, location of repairs, if contractors/inspectors are present, buyers looking to do things at the home like taking measurements & pictures, desire for aerials by the buyers if the seller has given permission, number of inaccessible areas & invisible areas that become accessible after move out, etc.
I will be bringing a walkthrough report for you to fill out. Please note section A of the walk through which states, "The Buyer has this day inspected the... Property & acknowledges that Buyer has not relied on any statements or representations to the conditions of the Property by the Seller or the Listing Firm or the Selling Firm (me) in reference to this walk-through inspection which are not expressed." With that being said, if a non-borrower is there helping you inspect, especially if they are checking on things while you're not in the same room, one option is to simply not sign the form. That said, in certain cases where we are making walk-through requests, that can make things tricky, i.e. bank repos if the bank wants a walk-through form prior to proceeding with any repairs. It's a good idea to be properly clothed in the event that you would like to check areas where you might get dirty & you wish to see for yourself (i.e. a crawlspace where thick & tear-resistant clothing, knee pads, elbow pads, boots, & a hard hat are ideal).
I will have digital copies of the consummated Inspection Agreement with the Seller on Repairs (if applicable), home inspection (if applicable), any addendums that impact the house materially, & ratified purchase agreement. If you want paper copies, you can either print them yourself or ask me to.
It's best to start with the HVAC test & dishwasher tests since those tend to take the longest. If testing HVAC & shifting from cool to heat w a heat pump, (unlike gas where it's more flexible), turn it off for 10 minutes first. Also, if it's not been 65 degrees or more for at least 24 hrs, some inspectors advise against testing the AC, unless it's a unit with a crankcase or sump heater. Likewise, some inspectors advise against testing heat pumps in hot weather. It's best to see what the weather was when your inspection occurred and see if your inspector tested them.
While most buyers don't get their inspector back for a reinspection, some prefer it. If an inspection was performed by your inspector of choice, you may want to get them back to the home at the time of the walk-through inspection if substantive repairs are done to the property and no pictures of those repairs are provided, especially if the seller did those repairs DIY. While a minority of inspectors don't charge, costs are typically between $75-$200 for a reinspection of PICRA items. Some buyers like to take family photos in front of the house at the walk-through inspection. If you would like to, please let me know in advance so that I can get a sold sign that you can hold if desired. In the event that you'd like me to take aerials, please let me know at least 4 days in advance for time for permission from the owner and manual FAA authorization, if required.
In the event that you arrive at the walk through before me, please don't explore without me.
Schedule Closing with Adam & Your Closer
While agent policies vary, I typically like to be at closings as long as I can be, though it's not required.
Long Before Closing Day Schedule Utilities to be Turned On in Your Name for Closing Day
It is important that you have utilities transitioning to your name at least as early as the closing date (or early possession agreement date, if applicable, whichever is earlier), that way you prevent any potential gaps in service & additional hassle-related (i.e. frozen pipes in winter w/ no heat, mold in summer if no AC, needing to be in the house for times much longer than an appointment time due to large windows provided when some utilities are turned on, etc.).
I've seen as high as an 8-day turnaround before water could be cut on from the time of a request when a holiday weekend was involved. If you're waiting to turn on utilities since you're concerned that you won't close on time due to financing, seller repairs, or otherwise, it's best to check in advance with the utility companies for their turnaround time.
You may see something about needing to turn the breakers to the off position for power, but that assumes that the power isn't already on. If you attempt to turn these on the same day that you close, you may find a lapse in service that causes a multi-day delay.
If purchasing in Chesapeake, Franklin, Gloucester, James City County, Portsmouth, or Virginia Beach, see the note in the utilities page about unique circumstances applicable.
That page also includes relevant phone numbers, websites, etc.
Check Your Closing Disclosure, Ensure You get it & Acknowledge it 3+ Banking Business Days Before Closing, & Forward to Your Agent
If you're using a mortgage, and if it's 4 banking business days before closing & you haven't been issued (& acknowledged receipt of) your closing disclosure yet, your closing and earnest money could be in jeopardy soon...
... alert your agent, then reach out to your closer and your lender to see if there is anything that you can do to help assist receipt of the closing disclosure by then. If you're found to be negligent, it could cost you financially significantly. Even if you're not negligent, some closings don't occur because of lender or closer negligence, costing you.
Business banking days vary by bank, but typically don't include Sundays, and sometimes don't include Saturdays. They may also exclude certain holidays (especially federal).
Check the closing disclosure...
... issued soon before closing. It is a form where the more trusted eyes on it, the better. I & my clients both have caught errors in them on many occasions, even though there are some cases where no errors are found. I've seen as big as a $10k error before that could have cost the buyer dearly if it hadn't been caught. Once you receive it, carefully look it over to make sure that everything looks good to you, comparing it with the contract, any addendums, etc. If you have any questions about it, the closing company is best, though it's also best to CC me in some cases, especially on a weekend, when under a tight deadline (i.e. 4 business banking days before the closing with no CD issued yet), or after hrs and you need the information quickly & they're not getting back to you.
Examples of CD Mistakes (I've seen as high as $10k)
Here are some examples of what I've seen:
a missing $10k earnest money deposit,
transaction fee payable to GRP was added erroneously costing you around $400 that shouldn't be there,
the buyer paying for the termite/moisture inspection when they hadn't exceeded their contractual cap on page 7 of the REIN SPA contract,
a home warranty missing in cases when the seller is supposed to cover the buyer's home warranty
Examples of Common Misconceptions on Mistakes
You might see what appear to be duplicate charges, with some stating that they are for the deed and some stating that they are for the deed of trust. Typically those aren't duplicate charges even if they appear almost identical including the amount being the same, but are legitimate charges. "Deed of trust" is regarding a mortgage, whereas "deed" is an element that's part of closing whether purchasing in cash or using a mortgage. That said, if you see anything, including apparent duplicates, that appears off, it never hurts to ask the closer.
Forward it to your agent ASAP
Please be sure to forward your agent the closing disclosure/ALTA ASAP after you receive it. There are some cases where revisions I suggest could delay closing, especially if the 1st time I see it is at the closing table & it's a Mon-Fri late afternoon or evening closing or a Sat/Sun closing.
Have Your Homeowners Insurance Ready
You should have your homeowner's insurance (required for all mortgages) and flood insurance (if you would like it or if it is required) lined up. Let me know if you'd like some recommendations.
Here is information from Insurance.com on some potential problems if your insurer denies you coverage.
If you have a tenant that will be occupying the property right away, be sure that the insurance covers them in the way it should & ideally that they have their own insurance.
If Getting Warranties, Have Them in Effect on Day of Closing
If you want one and there isn't one paid by the seller in the contract:
If you want to purchase a home warranty, with increasing reasons the older your home's systems/appliances (especially ones in the attic, where I've seen labor alone for a hot water heater replacement being $1800, though of course costs would vary), it would be good to have that lined up prior to closing so that you can get better pricing and have immediate coverage in case something breaks down right away (which can happen). If you need any recommendations, let me know. You would select it & order it (or select & give me the specifications so I can order it) prior & could pay before or pay at closing. If bringing the extra to the closing table, be sure to alert your closing company (preferably 4 days or more) in advance. Keep in mind that with warranties and insurance, coverage is limited & it's important to know those limitations based on your policies, especially if you want to consider better or additional kinds of policies.
If you want one and there is one paid by the seller in the contract:
It would be good to have that lined up prior to closing. If you need any recommendations, let me know. You would select it & order it (or select & give me the specifications so I can order it) prior & the seller would pay at closing. Be sure to either pick a warranty under the cap on the contract/PICRA or be willing to bring the extra to the table. If bringing the extra to the table, be sure to alert your closing company (preferably 4 days or more) in advance. Keep in mind that with warranties and insurance, coverage is limited & it's important to know those limitations based on your policies, especially if you want to consider better or additional kinds of policies.
Schedule Movers/Cleaning if Hiring Pros
Consider arranging the following in advance:
Packing
Cleaning of Your Current Home &/or Future Property
Uhaul, POD, or Movers
Contractors for Work
Getting off of Work
When scheduling, it's a best practice to have advanced notice prior to booking of whether or not cancellations are permitted in the event of any current unknowns that could delay closing (such as appraisal, closing disclosure issued 3 days in advance of closing if you have a mortgage, termite letter received following repairs if needed, other repairs completed, etc.).
As long as you are moving in after closing and not before, the longer between proposed closing & the move, the lower the likelihood of needing to reschedule. Scheduling following CD issuance also lowers the likelihood of rescheduling. Moving in after the deed records (usually the next business day after closing, but sometimes the same day [especially morning closings w/ $], and sometimes 2 business days after) also provides some added protection if something goes wrong between closing and the recording of the deed, which is very rare (<.1% for one closer I spoke to where it happened twice in her 45 year career across at least a few thousand closings), but is possible. In some places around the country, you don't even get the keys until the property records because of the potential problems from that.
If you're my client, ask me for my local mover list & list of contractors and cleaners.
Stay in Touch with Your Closer & Lender
If you're not paying in cash, be sure to stay in touch with your lender. Whether you're paying with cash or a loan, be sure to stay in touch with your closer.
With closing companies it is especially important to stay in touch during normal business hours to ensure that you are doing everything that needs to be done from your end in a timely fashion so as not to cause unnecessary delays or stress. Be sure to look for the most updated closing disclosure to determine how much you will need if the closing company or lender don't tell you directly.
Termite/Moisture
Before closing you will typically need (unless struck from the contract, i.e. w some $ offers):
REIN Offers (Typical in Hampton Roads)
A signed wood-destroying insect (termite)/wood-destroying organism (moisture) letter
VAR Offers (most of SE VA outside Hampton Roads, but sometimes in Hampton Roads)
A signed wood-destroying insect (termite) letter
Borrow a Radon Detector if You Haven't Gotten a Radon Inspection Yet
If you're Adam's client & you'd like to borrow Adam's radon tester after closing to perform some tests, the Ecosense RD200 RadonEye Home Radon Detector, just let him know and he'll plan to bring it to closing in most cases. You can typically have it for up to a week after closing as long as you return it to him. It's very easy to use.
Here's another map with more recent data & percentages with each county for a much more significant level of detail by a 3rd party:
Once you have it, here's how to use the radon detector.
If Appraisal is Higher than Contract Price & Getting Mortgage
Reports are mixed regarding whether or not you can secure better terms for your mortgage in the event of an appraisal coming in higher than the contract price. Especially if your appraisal comes in significantly higher, it doesn't hurt to ask your lender if it's possible to get a lower rate, lower PMI/MIP if applicable, or otherwise. If you are successful in securing better terms, or if you know it's universally impossible, & you can provide verifiable data to back that (i.e. a link w/ location cited), please let me know.
Rate Lock Timing
While not everyone has this flexibility, if you're getting a mortgage & you've gotten your appraisal back and have plenty of time before closing, you may want to consider when to lock your rate. Here are some resources regarding mortgage interest rate projections:
Unique Scenarios Before Closing:
Surveys
Remember that if a survey (& elevation certificate if applicable) is planned or already acquired, it's important to get that to the closing company quickly, before closing if you have it prior to closing. If you acquire it after closing, in order for the survey to have a positive impact on your title insurance coverage, they need it prior to 60 days after closing, but the sooner the better.
Related:
Investors
Some investors like to schedule out DIY work & contractors for after closing/possession in some cases. That said, some contractors are more flexible than others regarding cancellations or postponement in the event of any current unknowns that could delay closing/possession. The longer between proposed closing/possession & work to the property, the lower the likelihood of needing to reschedule. Scheduling following CD issuance also lowers the likelihood of rescheduling. Work on the property after possession & after the deed records (usually the next business day after closing) also provides some added protection if something goes wrong between closing and the recording of the deed, which is very rare, but is possible. In some places around the country, you don't even get the keys until the property records because of the potential problems from that.
Option to Move in Before Closing & Living There (Typically for $)
If you want to move some items into the house before closing, sometimes that can be arranged via a limited possession agreement. That said, you're typically talking about incurring fees and a refundable deposit.
Buyer Possession Agreement with REIN contracts.
Option for Seller to Stay at Property
In some cases there is a contractual agreement for the seller to occupy the property after closing. Here is more information on that:
Option to Move Items in Before Closing Without Living There (Typically for $)
If you want to move some items into the house before closing, sometimes that can be arranged via a limited possession agreement. That said, you're typically talking about incurring fees and a refundable deposit.
Day of Closing:
Location
Closings Typically Occur in the Closing Office, but with advanced planning, there are some cases where they can occur elsewhere, whether via mobile notary for an extra fee in another country as approved by the closing company for the individual used, closed in an alternate location that is mutually agreeable by buyers and closing company, or otherwise.
Moving In (Typically Not Ideal on Day of Closing, But a Low Probability of Issues if You Do)
It is typically best to not move in on the day of closing unless the deed records on the same day & you keep options open in the event of closing delay. Ideally, you should wait until after the deed has recorded, which more typically occurs the next business day or the next business day after that. That said, it really depends on your risk tolerance, the quality of the closer, and the quality of the title examiner. I spoke to a closer who had been doing it for 45 years, with thousands of closings total, where she'd only seen issues between closing and recording twice in her career, which accounts for a <.1% chance of an issue.
If you decide to move in before the deed records, be sure to not make any significant changes to the house (i.e. painting) just in case of any issues. While possession is at settlement often in VA, to limit liability further, some states typically have possession after the recording of the deed (i.e. NC), & some states require that recording and closing occur on the same day.
Delays on the Day of Closing are Common
Delays on the day of closing are relatively common (especially for morning closings), while delays of the closing date itself also happen with less regularity but still often. It's best to have as high of flexibility as you can around the proposed time/date of closing in the event of unforeseen issues that result in delays. Being flexible to delay closing until after issues are resolved is a key element of real estate, & yet another reason to not schedule moving in on the day of closing.
Time Needed
While some closings with closers take under 30 minutes, with closings with cash being quicker than closings with mortgages, it's good to budget an hour and a half for closing & post-closing at the closing office as long as you don't expect to read everything or have lots of questions. If you plan to read everything, it's best to alert the closing company upfront so that you can get digital copies of as much paperwork in advance as possible so that when closing day comes, you're familiar with things already.
If closing with a mobile notary, the notary is likely not going to be nearly as able as the closing company will be to answer questions. In light of that, be sure to get as much paperwork as you can and ask any questions you might have based on that paperwork directly with the closing company prior to closing so that the notary isn't presented with a high volume of questions on content that they're unfamiliar with.
Attire
Attire on the closing day really depends on your personal preferences. If I am there, I'll be in my usual like a polo or button down with no tie or jacket unless you'd prefer that I have on something more formal. Some buyers like to have some pictures of them at the closing, some buyers like to get pictures at the walk-through inspection, some like both, and some like neither. If you'd like pictures, be sure to let me know what you'd ideally like me to wear, whether it's a suit and tie or my gadget/tool vest and my hat that I sometimes wear when performing showings. Let me know as well if you'd like me to be ready at closing with a tripod for pictures if you'd like some photos with me and the closer all in 1 shot. If you'd like some of just you and your family and/or some with you and the closer, or you and me, others present like the closer or myself can easily alternate who is taking photos.
Identification Needed
On the day of closing you will need 1-2 forms of ID depending on your lender. At least 1 will need to have a picture & your passport and license or military ID are best, and other forms of ID include a social security card or membership to a club like Costco that includes a picture. If your ID does not match your legal name, you should have some form of identification that shows your legal name (i.e. a marriage certificate, etc.).
Your Agent on Closing Day
Agents aren't required to be at closings, but sometimes are. I like to be at closings whenever I can be, but am not always able to be, especially if you're either closing out of town or if another client has made a request for a time that would conflict with the time that buyers and closers are available.
Children, Friends, & Family at Closing
It's typically not a problem to bring kids or family to closing. Bringing friends is much less common, but some closers may not have a problem with it. I certainly don't have a problem with clients bringing friends, kids, or family. That said, be sure to alert your closer in advance so that they can have enough seats available, especially if you have a large family. If the closer doesn't have enough seats, but could accommodate more people if additional seats were available, let me know so that I can bring some additional fold-up seats.
After Closing:
If You Didn't Get a Home Inspection
Following closing, it's best to get a home inspector to come to the home and identify problematic areas in order for you to be better educated on what the home needs. You may want to schedule this inspection in advance for 2 days after closing & any other inspections you might have planned for 2 days after closing.
Related:
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