Closing on a new home is one of the most exciting times for new homeowners. It is a chance to lay down roots and have a place of your own. While it is an exciting time, it is also chaotic. There are a lot of deadlines to meet, papers to sign and rules to follow. If you are purchasing a new home, here are four things that you need to make sure you do before closing.
1. Get a Home Appraisal
A home appraisal is a crucial step in the home buying process. Most buyers work with a lending company to obtain a loan so that they can purchase a home of their dreams. Lending companies will often send out their own home appraiser to the property to determine the worth of the house. The lending company may approve your offer on the home or they could say that they are not willing to lend you that much, simply because they do not believe the home is “worth” that much.
The home appraisal is a necessary step before closing because it will help determine if you are able to secure a loan or not. If the appraisal is less than the asking price, you may be able to negotiate with the sellers for a smaller price. If not, they may choose to go with another buyer who has an all cash offer. This would be unfortunate, but beneficial to you in the long run.
2. Get a Home Inspection
A home inspection will help protect you from unexpected scenarios. You should always hire a trusted and reliable company to conduct your home inspection. A professional and licensed company will be able to do a thorough walk through of your potential new home to look for any concerns and problems with the home. They will look at every piece of the home from the structure to the electric to the roof and more. A typical home inspection will take a few hours to conduct, depending on the size of the home. Be prepared to attend the home inspection so that you can ask questions and get more information about the overall condition of the home. While the report of the home inspection takes a few days to create, the inspector will let you know that day if there are any serious red flags that need to be looked into further.
3. Obtain Homeowners Insurance
Another important thing that you need to do before closing is to secure homeowners insurance. Homeowners insurance helps protect you from having to pay exorbitant prices for repairs that need to be done to your home. Homeowners insurance helps protect you and your home from natural disaster damage, theft, flooding and more. Paying a small premium each month is worth the peace of mind. If you are financing your home through a bank, homeowners insurance will be required.
4. Transfer Utilities
Another thing you must do before closing on a home is to transfer the utilities into your name. Ask the current owners for a list of all the utilities and the utility companies they pay so that you can switch everything over to your name. Most utilities include electric and gas. Try switching them over sooner rather than later to give you less to worry about later.