The Importance Of Reviewing The Settlement Statement Before Closing On Your New House

When the seller of a house accepts your purchase offer, both parties involved will have tasks to complete. As the seller and buyer both complete these, the closing date will quickly approach. The closing date is the time in which you take possession of the house you are buying, and this appointment will require signing a lot of documents. Before you go to your closing, you will need to review the settlement statement you receive from the title company to make sure everything is correct, and here are some tips to help you know what to look for.

Check over the way the fees are divided

As the buyer of a house, you will probably have more fees to pay than the seller, with the exception of the commission the seller pays the real estate agent. It's important, though, to look over the fees to see exactly what they are, the amounts, and what they are for. It's also important to make sure the seller is paying the fees he or she agreed to pay.

For example, if the seller agreed to pay $1,000 of your closing costs, make sure this is reflected on the settlement statement. If it's not there, you will need to contact the title company right away to get this change made on the closing documents. Once you get to closing, they will not be able to make changes like this. The changes must be completed in advance so they are all reflected on the paperwork you and the seller must sign.

Review the escrow money from the seller

The closing documents should also list escrow money the seller has to pay, and this commonly includes a prorated amount of money for property taxes. Property taxes accrue for a year but are not payable until the next year. When a person sells his home, he is responsible for compensating the seller for these taxes that have accrued up to the date of the closing.

The seller will not physically pay the state or county for these taxes, though. Instead, the amount will be reflected on the settlement documents as prorated taxes. This amount will be subtracted from the proceeds of the sale, which means you will receive a credit for them. They will then be your responsibility to pay when they become due.

Your real estate agent can help you understand other factors to evaluate on your settlement statement. If you have questions about the information, talk to your agent today. Talk with a real estate agency like Gina Ziegler Remax for more information.