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What to Expect When Closing on a Home

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Closing on a home can be an exciting time for you and your family. However, the keys are not yours just yet. When you want to ensure the process goes as smoothly as possible, contact our closing company in Ponte Vedra for help.

What to Expect When Closing on a Home

Closing is the final step to the home buying process. The date of your closing is when you legally become the owner of the property. Though your closing date is set, your agents will still be working tirelessly with your lender and title agency to ensure everything is in line.

While your agents and lender work together, you also have work to do before the final closing date. You want to ensure you have a quality team of people who can help you at a moment’s notice. This includes your agent, an attorney, a home inspector, and more. You also want to make a checklist to ensure everything is completed leading up to your closing. This list should include:

  • Home inspection
  • Appraisal
  • Loan documents
  • Homeowners insurance
  • Final walkthrough

It takes an average of 41 days to close on a house. Many of the delays are due to financial issues, but can also be related to the appraisal, the loan, or the inspection. Be patient and work diligently to ensure everything is in line for when the closing day finally arrives.

When the day is here, you will pay any remaining closing costs, and the property will be signed over to you. If you need assistance with the closing process on your prospective home, contact Baron Bartlett, P.A. today at (904) 285-9993.

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What is the Fractional Investment in Real Estate?

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Not everyone has unlimited investment resources. That is where fractional investment can come into play. This form of investing is where a large number of investors contribute smaller investments. These investors will purchase a percentage of the ownership of a commercial property or vacation home. Dividing the cost makes sense financially, especially if the investors are all intending to utilize the property in some way.

Not only is the cost divided amongst these investors, but maintenance and other fees are divided as well. This makes the financial commitment much more manageable for all who are interested in the property. There are two options for investors seeking this type of investment: a Tenancy-in-Common and a Delaware Statutory Trust.

What is a TIC?

A TIC, or Tenancy-in-Common, is where all of the investors can own the property, but the IRS limits the number of investors. Each owner shares the responsibility for the upkeep and various expenses associated with the home or business.

What is a DST?

A DST, or Delaware Statutory Trust, is where the investor owns a beneficial interest in the trust and not the real estate. There is no limit of owners with a DST. The DST then acts as a single entity, making it easier to obtain financing for.

If you are interested in learning more about fractional investment, contact our real estate attorney in Ponte Vedra today! Our attorneys will help you find the best course of action for the property you want.

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What Loan-Related Fees Should You Expect at Closing?

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When you purchase a home, you will have to pay the associated closing costs. These costs can be incredibly confusing and are related to a variety of different things. Property taxes, appraisal fees, and more can be incorporated into the closing costs you are expected to pay. Below are all of the loan-related fees that will potentially be included at the time of closing.

The application fee: This is the cost of the application for the loan, which includes credit checks and various administrative expenses. This fee will vary based on the lender you choose and the work involved with processing the application.

The assumption fee: If you are taking over the remaining balance of the seller’s mortgage, you may be charged an additional fee based on that amount.

The attorney fees: If you have a real estate attorney in St. Johns County working with you, the fees may be included in the closing costs.

The prepaid interest fee: Many lenders will require the buyer to pay the interest on the mortgage that accrues during the date of settlement and the first monthly payment. This fee will vary based on the size of your loan.

The loan origination fee: Also known as an underwriting fee, administrative fee, or processing fee, this amount is charged by the lender for evaluating and preparing the loan.

The mortgage broker fee: If you are working with a mortgage broker, their fee will be incorporated into the closing costs. This tends to be 1-2% of the home’s price.

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What are Property-Related Fees?

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Buying a home can be shockingly expensive, especially once the Florida real estate closing costs are determined. There are many different fees associated with these costs, such as property taxes, insurances, title fees, and more. The total amount you pay will vary based on what is included in the prices. Below is what you can expect to be included in the property-related fees of your closing.

Property-Related Closing Cost Fees

The appraisal fee: Included in your closing costs will be the fee for the appraisal of the property. It is essential for a lender to ensure the amount being borrowed is worth as much as the property being purchased. This will let them know that the amount you requested is justified and that it can recoup the home’s value should you default on the loan. Certified appraisers on average charge between $300 and $400 for the appraisal.

The home inspection fee: many lenders require a home inspection, even more so if the mortgage is government-insured. Before lending you a lot of money for the property, the bank wants to make sure the structure is in excellent, livable condition. If the inspection uncovers some significant issues, you may be able to negotiate a lower price or back out of your contract altogether. An inspection will generally be $300 to $500 on the closing costs.

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How to Budget for Closing Costs, Part 2

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Closing costs can be unexpectedly expensive, but fortunately, there are ways to budget and save on them. Instead of paying more than you have to on the home of your dreams, the following tips can help you save extra on this expensive part of the buying process.

Plan Your Closing Time

One part of your closing costs consists of interest for the time between your closing date and the end of the current month. To reduce your out of pocket costs, opt for a closing date closer to the end of the month to minimize this prepaid interest.

Sign in Person

You may be able to reduce your closing costs by asking your escrow company. Contact them at the very beginning of the process to discuss all of the fees you will be charged. Then agree to use any electronic documents and sign in-person to potentially avoid fees for printing and mailing.

If you are concerned about the closing costs associated with your home purchase, contact our real estate attorney in St. Johns County. At Baron Bartlett, P.A., we have been assisting those with all of their real estate law needs since 1980. We can handle a variety of transactions and cases, so call our team today at (904) 285-9993 to schedule a consultation.