You’re done with home inspections and are well on your way to closing on your new home in Iowa City. What happens next?
Processing the Home Loan and the Appraisal
Now is the time when the bank and the attorneys spring into action. The lender will order an appraisal of the property. It’s not just a buyer that needs to qualify for a loan, the house needs to qualify too. If the appraiser doesn’t appraise the property at or higher than the purchase price then it’s back to the negotiating table it is.
During this part of the process it’s a good idea for you to check with your lender and make sure they have all the documents they need to process the loan. One thing your lender will want for sure is that you arrange for home owners insurance. This is really important – You won’t get a home loan without having your home insurance in place for the day of closing. Just a heads up that it’s worth shopping around for home insurance. You might not get the best deal from the company that insures your car.
Abstract Updating and Title Work
While the bank is working on the loan the attorneys are working on the title. Remember, the plan is that you give the sellers x amount for the house in exchange for clean title on the house in the form of a warranty deed. The seller’s attorney will update the abstract. (An abstract is a document that shows the history of the property). After that’s done your attorney will prepare a title opinion / title commitment. During this part of the process any judgments or liens on the property will all need to be noted and possible issues resolved before closing.
In case you’re wondering what your Realtor is doing while all this is going on. It’s our job to look at the bigger picture and oversee the process. If issues come up we need make sure that the players co-ordinate with one another to get them resolved. There are a lot of players involved in the process at this point and your Realtor is the only one who knows who they all are. You know what they say: “Too many cooks spoil the broth.” Your Realtor is around to make sure that doesn’t happen!
With the appraisal done and a title opinion or commitment provided to your lender that shows all liens will be settled by or on the day of closing, you can consider the process almost done. Your transaction is now officially Sale Pending.
Final Steps in the Home buying Process
Scheduling the utilities to start in your new home is pretty much the last job you have to do before closing.This can be done about a week before the date you’re scheduled to close. Here in the Iowa City area it is typical for buyers to take possession of a house on the same day they sign the loan documents, so the utilities should be switched to your name for that date too. This is true whether you move in or not. Once you sign the documents the house is yours and you pay for any costs incurred after that.
There are still the obvious things like scheduling a moving truck and changing your address at the post office, but other than that you’re almost done…
We still need to do the final walkthrough and talk about the HUD Statement – You’re definitely on the home stretch now. Onto the final step in the home buying process in the Iowa City area: Step 7 – Closing On Your New Home.