What Your Closing Agent Does for You
Although you may not feel you need to speak with your closing agent until you are well into the purchase process or possibly not until the day of closing, it is a good idea to contact the closing agent early on, introduce yourself, and be sure the agent has all your contact details, phone numbers, e-mail and mailing address. The closing agent usually works for a title or escrow company, or, in many Eastern states, it may be an attorney.
While you are taking care of property inspections and securing financing, the agent will be working behind the scenes to search the title, determine pro-rata expenses such as property taxes, work with the seller’s lender, with your new lender, and following up on any special instructions which may be spelled out in the purchase agreement. The agent will hold your deposits in a separate escrow account, prepare closing statements, and obtain title insurance. The closing agent works for you, so don’t hesitate to ask questions along the way. The closing agent is an impartial party to the transaction and is there to provide information and facilitate the transfer of the property from the seller to buyer. You may also have your own attorney working for you advising you on your personal circumstances or issues… Your attorney will liaise with the designated closing agent and have your best interests in mind.
Below is a check list of what your agent will be doing for you and what you in turn should do to be sure everything runs smoothly and you close on time.
Who Does What?
| What Agent will do | What You will do |
|---|---|
| Obtain a title report and arrange for Issuance of policy of title insurance. | Read and understand the title report. Question any easements, liens, rights of way, or other issues in the report. Check the plat map for correct boundary lines. Sign off on agent’s report. |
| Prorate costs such as property taxes, Insurance, loan interest, and rents, if applicable. | Check the proportioned expenses. Do the math. Mistakes do occur. |
| Collect and coordinate paperwork, Including financing and required disclosures. | Arrange for cash, in the form of Cashier’s check or bank transfer for your portion of the closings costs which you agreed to pay.* Pay attention to any increase in your deposit which may be required after initial purchase agreement was signed and date funds are due. |
| Transfer and record deed. | Check the spelling of your name, the manner in which you will hold title, and the description of the property. |
| Transfer your payment to the seller. | Speak directly with other parties, such as the inspector, real estate agent, mortgage broker or your attorney to be sure everything is in order before you hand over your final payment. Check and cross check before the day of closing. |
Who Are The Other Parties to the Closing and What Will They Do?
In addition to the closing agent, title company, attorney, and real estate agent, there will probably be a lender involved in your closing. The lender will provide the financing for the property and work with your closing agent to be certain that all the conditions required to fund your loan will take place prior to closing. There will be an appraiser involved, who will examine the property and issue an appraisal report. There may be a surveyor, who will issue a survey, which may be required by your lender.
There may be a pest inspection company and a building inspection company involved in your closing. These inspectors will be responsible for performing a detailed inspection of our house and issuing a report as to their findings. There will be an insurance agent involved, as a new insurance policy will need to be issued on the property.
How You Will Pay the Closing Agent
A single escrow closing fee, determined by the amount of money involved in the transaction, will cover all of the usual escrow closing services except for the title insurance fees.
Local custom unique to a particular geographical area generally dictates who will pay which fees. In some areas, the buyer pays the title and escrow fees, whereas in other areas, the seller pays half of the fees and the buyer pays half.
[div class=”tipbox”]TIP
Although dictated by local custom, many closing costs may be negotiated. Be sure to discuss this before signing the purchase and sale agreement. Clearly spell out the costs the seller will pay, and those which will be the buyer’s responsibility.[/div]
Get The Best Closing Agent
One of the many extra services a closing agent offers is information. Your closing agent will be available to answer your questions about the closing process in general, and your individual transaction in particular. Your closing agent will know the status of your closing at any given time. Don’t be afraid to ask, even if you may feel your question has been asked before. It is better to be clear before signing any document, especially since they may well be legally binding for many years to come.
To make sure you are choosing the best closing agent, get referrals from not only your agent, attorney or mortgage broker, but from trusted family members, friends, neighbors, or colleagues. Make sure your referral source had a good experience with the closing agent and found the agent to be efficient, accurate, and able to handle the closing according to schedule.
[div class=”tipbox”]TIP
Choose a closing agent who is conveniently located. You will probably have to drive there at least once, for the closing, and perhaps several other times. For example, you may need, you to sign a power of attorney, deliver an old divorce decree or provide a copy of a trust agreement.[/div]
Copyright © 2013 Sandy Gadow. All Rights Reserved. This article may not be resold, reprinted, resyndicated or redistributed without the written permission from Escrow Publishing Company.
