What do you need to take to closing?
Our closing attorney will give you a list of documents you will need to bring with you to closing. Generally those include:
- wired funds for the down payment and other buyer costs;
- insurance policy (must be ordered prior to closing from any licensed insurance company) and a bill or paid receipt;
- any paperwork still required by lender (for example, a termite inspection report); and
- photo identification (valid driver’s license, state issued ID or passport)
What are some terms you will hear at closing?
The closing can be a little overwhelming, especially if it’s your first time. You may feel as though you’re signing away your life. Knowledge equals peace of mind, so here’s a list of terms you will typically hear at closing:
- Warranty deed. This document is signed by the seller to convey the title to the buyer. The warranty deed contains the exact legal description of the property and is recorded in the courthouse of the county where the property is located.
- Security deed. A document that is signed by the borrower which is recorded in the courthouse records showing that there is a loan against your property. It gives the lender the right to foreclose and take title to the property if the loan isn’t paid back or you default under the loan documents.
- Promissory note. This is the formal document showing the loan amount, interest rate and term of loan.
- HUD-1 settlement statement. Sometimes, this is called the closing statement. It shows all financial terms of the transaction, including how much money both the seller and real estate agent will receive as well as the exact amount the buyer must pay at closing. All money that changes hands must be reflected on the HUD-1 Settlement Statement.
- Truth in lending statement. This identifies the annual percentage rate, which is the loan interest rate plus the finance charges paid by the buyer. It also shows the total amount paid back over the term of the loan.
How to take title to the property.
If you are purchasing real estate with another person, it is important to consider how you will take title to the property. Georgia law recognizes two primary options for joint ownership: 1) Joint Tenants with Right of Survivorship and 2) Tenants in Common. Tenants in Common means that upon the death of one owner, the deceased owner’s interest will pass to the deceased owner’s estate. Joint Tenants with Right of Survivorship means that upon the death of one owner, the deceased owner’s interest will automatically pass to the other owner, regardless of the deceased owner’s will. Of course, there are other ways to hold title, such as in a separate legal entity such as a LLC or corporation.
Purchasing Title Insurance
Owner’s title insurance is not required by law in Georgia; however, it is an extremely important protection for you as the owner of real property. An owner’s title insurance policy ensures that you hold an insurable title to your property. It’s a relatively small one-time cost, and it can protect the buyer from mistakes in title examinations and other title problems caused by prior owners of the property. This policy may be purchased at the time of closing through the closing attorney and may also be purchased at a later date. Your lender will most likely be purchasing a lender’s title policy. It is important to note that a lender’s title insurance policy does not protect you as the owner of the property, but if your lender is obtaining a policy, you may be eligible for a substantial discount on an owner’s policy.
Obtaining a survey
Many lenders do not require a current survey prior to closing on real estate in Georgia. But, it’s a good idea to get one prior to closing because it will show the location of the house and other improvements such as fences, garages and driveways on the property. A survey also reveals any improvements encroaching on or from adjoining properties. Please notify our closing attorney prior to closing if you wish to have a survey of your property prepared.