What You Need To Know About a Real Estate ClosingDownload Our Free Real Estate Guide
In this educational video, Buffalo Real Estate Attorney Richard H. Cole explains what you need to know about a real estate closing. If you have questions about the purchase or sale of real estate in Western New York, please contact us to schedule an appointment. Let our experience work for you.
- The closing is comprised of two basic parts. If you are the buyer, your first part is a meeting with a bank attorney – generally around half an hour in length – during which you will sign a note, which is the bank’s promise to lend you money at a certain interest rate for a certain term. Traditionally, the note will state that you can prepay it without penalty and describe what can happen if you are late in making your payments.
- You will also sign a mortgage document that protects the bank’s security interest in the property if you don’t pay your mortgage or taxes, if you fail to keep insurance in place, or if you don’t properly maintain the house.
- If you fail to do any or all those things, the bank can either call the note due or foreclose upon the property, although that’s very rare.
- The third document is a closing disclosure which gives a complete financial snapshot of the transaction, including the purchase price and a list of the credits that go back and forth between the buyer and the seller for taxes, initial deposits, or credits for repairs that need to be undertaken based upon the home inspection and so forth. It will also identify various costs the buyer owes to the lender to complete their transaction and to the local government for things like recording costs for the deed and the mortgage.