If you think about visitations, closing costs, and other things before the big finish, then you’ve found a buyer, negotiated the house repairs, and are ready to move, and so on. But before you can formalize this sale, you still have a few things to cross off your list. Here’s everything you need to know to be successful with your settlement.
The fence is the last step
Closing, or “settlement,” occurs when both parties sign the final ownership and insurance documents, and the buyer becomes the legal owner of the home.
Typically, the closing day is about four to six weeks after signing a buy and sell contract. During this window, the buyer’s purchase funds are blocked until all eventualities, such as the possibility of a home inspection and the possibility of an appraisal, are met.
Your Realtor® will be able to answer questions and offer support until closing. Here’s what to expect from the process, from start to finish.
Before closing, you will have one last guided tour
Most sales contracts give the buyer a last chance to tour the house within 24 hours of settlement. It is their chance to check that the property is in good repair and to ensure that the agreed repairs have been made.
In most cases, no problem arises at this stage of the transaction. If there is something wrong, congratulate yourself for using a Realtor®. The final visit primarily gives buyers the peace of mind of knowing that the seller has met the terms of the sales contract and the repairs associated with the home inspection.
Follow these steps to prepare for the final visit
It’s not over until the ink is dry! To make sure the tour goes smoothly, follow these six steps ahead of time to prepare:
Step 1: Clean the house. Your house should be mopped for the final visit. Assuming the buyer takes possession on the day of closing, you should be completely moved by this point.
Step # 2: Leave the owner’s manuals and warranties. Make the buyer’s life easier by providing all the manuals and warranties you have for home appliances. Print physical copies and place these documents in one place for the new owner. If you have contractors’ receipts for repairs, leave them with the manuals.
Step 3: Provide a list of suppliers. Give the buyer contact details for any building contractors or maintenance companies you have used in the past. These sellers know your home well, and the new owner will appreciate having a list of repairers they can trust to take good care of their new home.
Step 4: Check the forgotten items. Do another whole house check to make sure you’re not leaving anything behind. One exception: You may want to leave unused or leftover cans of paint in the colors currently in use in the house, but check with the buyer first.
Step 5: Lock. Until the settlement is complete, you are legally responsible for the home, which means you would be responsible for any break-in before closing. It’s a good idea to leave a porch light on or set an interior light to turn on and off with a timer.
If the final visit reveals a problem with the house, don’t panic. Standard protocol is for the buyer’s agent to immediately alert the listing agent that there is a problem. Then the two sides work together to solve it. Typically, either closing is delayed or there is additional negotiation, such as a monetary deduction from the sale price. In other words: there are options, and your agent can help.
Suppose the final visit is smooth navigation. (Woo-hoo!) What happens next?
You will get information about your closing costs from the attorney. Closing usually takes place at the attorney’s office or at the buyer’s or seller’s real estate agent’s office. CT currently allows partial electronic fencing with remote notaries, and parties involved can opt for digitally signing documents.
Since COVID, sellers may be able to skip the process. Instead, your lawyer can act as your representative and you can pre-sign the transfer documents.
Remember to budget for closing costs
Closing costs can vary widely depending on the location, but you will typically pay a closing cost of 5-10% of the home’s selling price. So, on a $ 300,000 home, you can expect to pay between $ 15,000 and $ 30,000 in closing costs. In most cases, these fees are deducted from your product at closing.
Closing costs for sellers typically include:
- The commission for the listing agent and the buyer’s agent
- Transfer taxes or registration fees
- Loan repayment costs
- Unpaid owner association dues
- Contributions from homeowners’ associations included up to the date of payment
- Prorated property taxes
- Escrow, title or attorney fees
Cancel your home insurance
You don’t want to be without cover (what if a pipe bursts ?!) until the deal is legally finito.
Don’t want to pay the new owner’s electricity bills? Coordinate with the buyer so that utilities, including not only gas and electricity, but also water and cable, are transferred to the buyer on the day of closing.
Setting up a forwarding address will also ensure that you can be reached if there is any issue after closing. You can file a change of address with the U.S. Postal Service here.
Finally, your house is officially sold. Congratulations! Pat yourself on the back, then start settling into your new phase of life.
For more information on how to safely buy or sell a home, contact the Eastern CT Association of Realtors® at 860-892-2595 or visit www.easterctrealtors.com to find a Realtor®.