Some states have title companies that handle closing transactions. In South Carolina, real estate attorneys do this job. The basic flow of information goes from you as the buyer, to the real estate agent so they can find you a home, then to the lender so they can make the loan, and then ultimately to the closing attorney who can consummate the transaction.
While the above sounds fairly simple, the process can be more involved depending on the nature of the transaction and primarily the house that you are buying.
The bureaucratic member of this process is always the lender. And rightfully so, as they have a difficult job. They need to gather your information, organize it in a way where an underwriter can evaluate it, check and recheck every single detail along the way, and then ultimately provide a package of information so the attorney can prepare the paperwork properly.
It’s very important to make sure that the lender has provided what is called a clear to close prior to making definitive arrangements with your move. Once a clear to close has been obtained from the lender, then the process is more or less guaranteed to occur at that point.
So the big questions that come up the day before closing surround the finances. Buyers are making their plans to go to the bank and get a certified check that needs to be made payable to the closing attorney. These funds can also be wired, but the important factor is how much money did the buyers actually need?
The frustration that occurs is that the attorney is unable to answer that question until they receive what is called a loan package from the lender. Again, the loan package are specific instructions from the lender to the attorney noting exactly how they are to structure the paperwork in an effort to close. Part of this paperwork includes a HUD statement. The HUD statement is a statement of all of the numbers involved in the transaction and has both a buyer and seller’s column. It notes every cost line item by line item so you is the buyer are protected knowing exactly where every penny is spent with your new purchase area. In some cases, the bureaucracy creeps in from the lender. They may not be ready in time, or they may be backed up, or someone may have not completed an item in time and everyone is waiting to close. They are unable to provide the closing package until every detail is handled on their end.
The moral of the story is this… We can all her run around like crazy and do our jobs and be efficient and make it all happen in a very timely manner. The lender, who is usually not at fault but just dealing with many details, may cause a delay. This delay will cause a delay in your ability to go to the bank and make the wire transfer, or obtain the certified check. This is probably the biggest cause of stress associated with the closing. Nothing that can’t be overcome, and remember you are the buyer. There is no need to be rushed, and there’s no need to be stressed. Of course we need to follow the guidelines set forth in the contract, but moving is already stressful enough so please… If this occurs, take a deep breath and remember this is a joyful process and a big change in your life that we are glad to be a part of.