Closing the Sale
At last – you’re ready to finalize the sale! During the closing, you’ll meet with all parties involved in the sale to make it official by signing documents, receiving the deed and paying your closing costs, which may include:
- Attorney, broker, credit report and/or lender fees
- Title search and insurance
- Appraisal and inspection fees
- Points – a predetermined fee similar to prepaid interest
- Paid to the lender to receive a particular interest rate
- 1 point equals 1% of the loan amount
- Other costs depending on your particular loan
Property insurance: Also called homeowner's insurance, property insurance protects the homeowner from losses to the property, as well as potential liability from events that occur on the property and elsewhere. Lenders require homeowner's insurance coverage to protect the collateral that secures their loan. Some homeowner's insurance policies do not cover catastrophic events such as tornadoes, hurricanes or floods. These kinds of events generally require a separate insurance policy. Sometimes additional insurance may be required for your loan.
Property Taxes and Homeowner's Insurance: A typical monthly mortgage payment consists of amounts for loan principal, interest, taxes and homeowner's insurance. Taxes and insurance are usually paid from an escrow, or impound, account.