The search has ended. You found “the one.” So, what’s next after buying a house?
It would be nice to just let the euphoria of finally finding your new home wash over you and enjoy the sense of accomplishment for a little while. But “NO!” The clock is ticking. You have to find an attorney, shop for a mortgage, schedule an inspection, call the movers, contact the utility companies, the list seems endless. And how much time do I have? 30-45 days? Yikes! How will you get it all done?
The good news is that we put all the pieces of this puzzle together every day. You knew (or kind of figured) you would need to take care of all these details going in so you are probably more prepared than you realized.
Here’s the cast of characters and a few tips for selection and what to expect of each of them, individually and together:
Who should I use? It is advisable to use an attorney who specializes in real estate, preferably in the area where you bought. Using your friend’s uncle who does litigation in Chicago is not a good plan. Ask for referrals. Your Realtor will know several reliable real estate attorneys as well as friends and family who may have recently bought a home. My clients will either call a few referrals and choose one or ask me to take care of it. My office sends the contract to your attorney as soon as you tell us who you are using.
What does the attorney do? The first thing your attorney will do is review your contract. They typically have 5 business dates to make modifications with the exception of price. Most r.e. attorneys will request a few language revisions to the standard contract. They will contact you and the Seller’s attorney within the first couple days after acceptance.
After the inspection (Refer to “What To Expect When You’re Inspecting”), your attorney and I will discuss the results with you to determine what, and if, you want to ask the Seller to address. The attorney will compose a letter detailing the findings of the inspection, usually providing the report, and how you would like the Seller to address them. (credit, repair, replacement) He/She should work to ensure a timely resolution of the issues and get everything in writing.
The attorney watches your dates: inspection dates, mortgage commitment dates, closing date. If it looks like you need an extension to complete something, they will send written notice asking for more time. Your attorney will work with the Seller’s attorney to schedule the closing date, time and location. You will be involved in this process.
The attorney attends the closing. He/She will review the documents you will be signing. They will be explained to you in detail. They will review the title insurance, the survey, all figures, any receipts for work that was done, mortgage documents, the Bill of Sale, the RESPA and HUD, etc.
The attorney will be paid at the closing. Make sure you know your attorney’s fee prior to hiring them. Ask if there is anything that could increase their charges. (i.e. Reviewing multiple contracts, inordinate amount of correspondence, extra legal work pertaining to an estate, etc.)
It is very likely that you will have been in touch with one or more lenders prior to your purchase. It is common practice to include a “preapproval letter” with all offers confirming your ability to qualify for the purchase you are making. Things to consider when selecting a lender are:
- Are the rates competitive? It is easy to check rates online!
- Is the loan officer easily accessible and responsive?
- What is their track record with regards to processing time?
- Will you be given weekly status reports on the progress of your loan approval?
- Do you feel comfortable having this company handle this important investment?
In the contract I use, the Buyer is required to apply for a mortgage within the first week after acceptance of the contract. Prior to applying, find out what they need and try to provide as much as you can at the initial meeting. This will save time. The lender will ask you if you want to “lock your rate” or “float it.”
They should explain to you the pros and cons of both options. Ask how long the lock is (55-60 days is normal.) It is common to find a lender through referrals. As with all referrals, a loan officer will feel obliged to provide great service to a personal or Realtor referral. It means more referrals in the future and they will want you to use them to refinance if in the future.
Please read “What To Expect When You’re Inspecting.” It is a common sense guide to getting the most out of the inspection process.
There are hundreds of moving companies out there. They are shameless about soliciting Sellers but they do not have access to Buyer information. Referrals are your best bet. Choosing a mover may depend on whether you are moving locally, cross country or internationally. You should have the mover look at what you plan to move, if possible, and give you a written estimate. Will they be packing for you or will you pack yourself? What about their insurance? They should be able to tell you how many people will be there on Moving Day, what time they will arrive, how long they expect it to take and any unforeseen expenses. If it takes longer than the estimate, is there an additional cost? If they are delayed due to closing delays, weather, not having immediate access to the new home, what is the cost?
Coordinating closings and moves on the same day can get tricky. Know your options and plan accordingly. If you are closing on your new home in the morning and can move in that afternoon, great. If your closing is in the afternoon, you may need to move in the following day. What is the cost to hold your stuff overnight? Buyers often ask if they can start moving in prior to closing. Attorneys usually advise against this practice due to the risks involved. They like “clean deals” where the house is empty at closing and you move it when you get the keys. Moving in early or keeping your possessions in a house you just sold are situations that will require Possession Escrow, Hold Harmless Agreements, Rent Back Provisions, etc. Rest assured, whatever set of circumstances we encounter, I have seen it before in one form or another and we will figure it out.
You must call all the utility companies and transfer service into your name prior to closing. Failure to do so may result in loss of service for an extended period of time. Let us know if you need utility company names and numbers. If you are establishing wireless service, make arrangements in advance to ensure a smooth transition. I have seen people who work at home disabled due to poor planning.
Utilities to establish are:
- Scavenger (Garbage)
- Cable / Dish
Review your current utilities to be sure you didn’t forget something.
Sellers often leave a list of contractors and service providers that they have used. This may include babysitters, pet sitters, landscapers, snow plow service, pool companies, cleaning people, electricians, plumbers, irrigation companies, tree service, painters, roofers, etc. Don’t be afraid to ask for a list of reliable people. If the Seller doesn’t have a list or the house is vacant, ask me. Even if you don’t use them forever, it will be a great thing to have those first few months.
You will need a paid insurance policy at closing. Chances are you have insurance and can call that provider for homeowner’s insurance. Referrals are a good source, too. (I am a former Allstate manager!)
School registration, Park District registration, sports programs, car insurance and registration, iPass account, bank accounts, doctors, dentists, etc. are important to remember. To register for school, you may need a utility bill in your name at the new address or a sales contract.
Make arrangements to change your address once you are reasonably comfortable that your sale will close. Send Change of Address cards. Magazines are not usually forwarded. Let them know your new address. Chances are that mail, especially from insurance and utility companies, will arrive at your new house before closing. The Seller or their Realtor may let us know to pick it up or we may need to check the mailbox of a vacant home periodically.
GETTING BACK INTO THE HOUSE
If you are ordering appliances, carpeting, remodeling supplies or have family in town, you may need/want to gain access to your future home before closing. Most Sellers are happy to comply with your requests, within reason. If you are getting estimates, please try to schedule them on the same day and time period. The Seller will most likely have begun packing and purging. They may feel funny about you seeing the property in a state of flux. Plus, it is a busy time for them as they prepare to move. The Golden Rule applies here and we will do everything we can to accommodate your needs.
HURRY UP & WAIT
….is the best way to describe this process. You will have lots to do that first week and then we wait for everything to fall into place. Don’t hesitate to ask me for help!
FINAL WALK THROUGH
You have the right to inspect (walk through) the property prior to closing to be sure it is in the same condition it was when you bought it and in “broom clean condition.” Most buyers like to do this within 1-2 days of closing. I will schedule this and accompany you. At the walk through, you should look at the walls, floors, ceilings to make sure there is no new damage. It is a good idea to turn on the stove, flush the toilets, etc. If the Seller made a repair or a replacement, you can see it. Ideally, buyers like to see the house completely empty. This is not always possible and we will work around it. If there is a stain on the carpet, hole in the wall, etc.; we will let your attorney and the Listing Agent immediately. Such deficiencies can be handled two ways: You can put money in escrow that will be released to the Seller once the problem is fixed. OR You can accept a credit to address it yourself post-closing. Walkthroughs typically last 20-30 minutes.
Congratulations! Buying a house is not an easy feat, but once you’ve finished all the steps listed above, it is time to unpack, decorate and start making memories!