What Should Be on Your Property Closing Checklist? | Rookie Resources

TL;DR

A property closing checklist should track every task from offer acceptance through the start of post-closing work. Ashley Care recommends recording the property address and purchasing entity, then verifying inspections, appraisal, title or attorney coordination, earnest money, the closing date, and the closing statement. Her experience losing a deal during a three-business-day attorney approval period shows why buyers should personally confirm each step. Read on for the complete workflow and common pitfalls.

Transcript

welcome to rookie resource my name is Ashley care and I am the co-host of the real estate rookie podcast if you haven't already make sure you are subscribed to the real estate rookie YouTube so you can get updated and notified when new videos are released especially these rookie resource videos that we are doing every time we upload a video you are... Read More

Key Insights

• A comprehensive closing checklist is crucial for organizing tasks and ensuring a smooth property closing process.
• Attorney approval is important in some states and can impact the contract process, as seen in Ashley's experience.
• The earnest money deposit must be documented and verified to ensure accuracy on the closing statement.
• Understanding the closing statement details, including purchase price and closing costs, is essential for financial preparedness.
• Insurance and utility arrangements should be finalized prior to closing to avoid potential complications.
• Rehabbing a property requires proactive planning, including contractor scheduling and scope of work development.
• For rental properties, creating a tenant handbook and setting up property management systems are key steps.
• Maintaining detailed property information, including utility and appliance specifics, aids in efficient management and troubleshooting.

Questions & Answers

Q: What should be included on a property closing checklist?

Start with the property address, the entity purchasing the property, and an attached property contract. Then track offer acceptance, inspection scheduling, the appraisal, title or attorney notifications, attorney approval when applicable, the earnest money deposit, the closing date, and receipt and review of the closing statement.

Q: Why should buyers use a property closing checklist if they already have a team?

Agents, loan officers, attorneys, and title companies are key to closing, but buyers still have tasks to complete and verify. The checklist helps confirm that every involved party has been notified and that required steps are not overlooked before, during, or immediately after closing.

Q: How does the closing process described for New York work?

Ashley says her agent sends the contract to her attorney, who sends the information to the title company. The title company returns the information to the attorney, and the attorney then tells the agent when they are clear to close. Because the information passes through several hands, the process can take longer than working directly with a title company.

Q: Why does attorney approval matter in some property contracts?

In some states, the buyer’s and seller’s attorneys must approve the contract before it becomes official. Ashley describes losing a deal when the seller received a much higher offer and used attorney rejection to exit during a three-business-day approval period.

Q: What happened after Ashley’s offer and inspection were accepted?

Ashley went under contract on Friday and completed a satisfactory inspection on Saturday morning. During the attorney approval period, the seller received a higher sight-unseen offer and rejected her contract through the attorney clause. The seller reimbursed the $375 inspection cost.

Q: How should an earnest money deposit be documented?

Confirm that the deposit was submitted, record its amount, and take a picture of it. Ashley sends the picture to her agent, who forwards it to the seller’s agent. This documentation helps verify that the closing statement gives the buyer credit for money already paid toward the purchase price.

Q: What information appears on a property closing statement?

The closing statement lists the purchase price, money already paid, and amounts owed to the buyer and seller. It can also include prorated property taxes and closing costs such as amounts owed to the bank, attorney, and for postage. Buyers should receive and review it before heading to closing.

Q: What should buyers verify about the closing date and closing statement?

Record the scheduled closing date as soon as it is known. Also track whether the closing statement has been received with enough time to review the purchase price, credits, taxes, and closing costs. Buyers should not be on their way to close without having reviewed it.

Summary & Key Takeaways

• Ashley Care discusses the importance of a property closing checklist, detailing essential steps to ensure a smooth closing process. The checklist covers everything from offer acceptance and inspections to insurance and utility arrangements, emphasizing the need for thorough preparation and documentation.

• The video highlights the significance of attorney approval in certain states, the earnest money deposit process, and understanding the closing statement. Ashley shares her personal experiences to illustrate the potential pitfalls and the importance of proactive planning and communication with involved parties.

• Additional insights include strategies for rehabbing properties, creating tenant handbooks for rental properties, and organizing property information. Ashley emphasizes the value of using a checklist to avoid common mistakes and ensure all necessary tasks are completed efficiently.