Dealing with the paperwork

February 2007

Dealing with the paperwork

House with SOLD sign. Original image at sfbay.redfin.com/blog/2007/08/page/2

Something I've been meaning to do
I've often thought I ought to have an "acceptance-through-closing" list to give to my buyer clients, but I've been guilty of never quite getting around to it. However, the arrival of yet another New Year triggered a commitment to do -- so here's one Resolution I can now say I've kept!
Perhaps it seems useful to start with a summary. It isn't in any exact sequence and some items can be done in partnership with others. The specifics of your offer and change of address and ownership will also have a bearing on what needs to be done when and by whom. On the whole, though, the main points to be dealt with will be as follows.

•    Completing the paperwork (getting offer copies to your lawyer and lender)
•    Fulfilling conditions (the most common ones are Home Inspection and Mortgage Approval)
•    Arranging insurance (A Household policy, rather than just a Building one, makes some sense)
•    Registering with the utility people (hydro, gas, water, telephone, internet)
•    Registering with the municipality re taxes (and perhaps garbage collection)
•    Change of address notices (and perhaps mail forwarding with the Post Office)
•    Changing schools, libraries, churches, (and, where necesary, heating oil suppliers)
•    Contacting a mover (and, of course, "packing")
•    Buying new/additional furniture and/or appliances -- and arranging for delivery of them
•    Coming up with the downpayment balance, legal fees, and closing disbursements
•    Signing papers with your lawyer
•    Picking up the keys
•    Arranging for meals during moving day -- you need to keep your energy up
•    Getting unpacked -- and you're allowed six months to do it!
•    Saying hello to your neighbours -- which never does any harm and can prove very helpful
•    Finding out where to shop for what -- see Saying hello ....

What to expect from your agent and lawyer
Most real estate and law offices will look after distributing the offer copies and, ahead of closing, taking care of registering you as a new owner with the utility companies and municipality.
At the most, you need to simply check with them that they've already done this or fully intend to do so.
You can also depend upon being asked a few days ahead of closing to visit the law office to sign papers (and there's more of them than the half dozen pages that made up your offer!). At this time, your lawyer will be looking for a cheque (usually certified) to cover the downpayment, his/her fees, and the disbursements. Invariably, you'll be told what the total amount is when the appointment is made for you to come into the office.
Betweentimes, your agent will have passed on the likes of Condition Waiver pages, just as your lawyer will have been advised by your lender of the mortgage funds that are going to be advanced on your behalf.
If and as any occcasion calls for it, your agent and/or lawyer will contact you regarding whatever shows signs of being a problem or concern. It is, of course, their job to look after your best interests and they aren't doing this if they allow anything unexpected or unanticipated to get in the way of a trouble-free closing.
In the same way, there's no reason whatesoever why you can't/shouldn't contact either/both of them with any questions or uncertainties that are bothering you.

The lender's responsibilities
Whether you're dealing with your favourite bank official or using a mortgage broker (which is increasingly becoming the norm), their primary duty is to get the mortgage funds into your lawyer's hands in time for the transaction to close. This isn't, I'm afraid, something you can simply take for granted. Lending people are somewhat notorious for leaving things to the last minute.
What you need to be sure of is (preferably written) confirmation -- well before the closing date -- that your mortgage application has been approved.
On your part, the lender can -- and will -- expect you to provide the supporting documents they require (e.g. tax returns, employment letters, proof of downpayment, availability of funds for legal fees and disbursements). It does help if you aren't on the last minute in coming up with them!
The lender will also want to see evidence of an insurance policy that takes effect on the closing day -- and it will be left to you to arrange this.

Fulfilling conditions
The terms of your offer will determine what needs to be done, when and by whom. Again, though, you will largely (and rightly so) be pushed into it by your agent and lawyer (assuming that they're doing their job properly).
a) Home Inspection
You DO have the right to use whoever you choose, but many agents (especially those who are representing you and not the seller) will suggest someone whose experience and judgment they've come to trust. The general recommendation is that you personally attend the Inspection (as your agent is quite likely to do as well). Not the least of the purposes is to familiarize you with the present condition of the house and to make you aware of the ongoing maintenance costs you should allow for once you take possession of it.
You will usually be expected to pay for the inspection on the spot (and you can get a quote beforehand) and you'll receive a fairly thick binder that contains the inspector's specfic observations regarding the property and what amounts to a wealth of information and advice about keeping a property in good condition.
Assuming all is well with the inspection -- and the correction of any deficiencies can, more often than not, be negotiated with the seller -- your agent will ask you to sign a Condition Waiver form that he/she will then pass on to your lawyer.
Needless to say, if the Inspection isn't satisfactory, the deal can be aborted and you can have your deposit returned to you forthwith.
b) Mortgage Approval
There's every good reason to start an application as soon as your offer is accepted. Most of the time, approval is needed within the same ten or fourteen day period that a home inspection report is to be obtained.
Your lender may want to have an appraisal done and, although this will be arranged by the lender (and perhaps at your [on the spot] expense), it's required urgently if you're going to waive the condition in time.
Short only of the advice to worrywart the lender into not holding up your application, though, it should be possible to waive the mortgage arangement condition alongside the home inspection one.
A copy of the Waiver form -- assuming you issue one -- can then go to the lender (more than likely, courtesy of your agent). This will be followed by an immediate confirmation of your wish to have the funds advanced. (A small nitpicking point, but your application merely allows to lender to say okay. You have to subsequently come up with an okay of your own before the formal mortgage arrangements are put in place.)

You ain't seen nuthin' yet!
If there's some nail chewing in looking for a house, finally running across it, and then getting an offer accepted by the seller ....... it's only a beginning, By the time you've gone through the numerous steps that lie between acceptance and getting the keys on the closing day, you'll possibly be like many other buyers. You won't want to do it again, at least for some time!
But, you certainly don't need to "go it alone." There's a great deal of help and longtime experience you can -- and should -- tap into.
The one point of reservation is the packing, not to mention the many other &cs in my list. They, I'm afraid, Are Up To You!

With every good wish to you notwithstanding.