What to Expect: Real Estate Closing Documentation
Purchasing a home, or another type of real estate, is an exciting time in one’s life. The decision to invest in real property is likely to be the biggest that person will make in their lifetime. They have spent copious amounts of time researching properties, visiting properties, and making the decision of which piece of property will be the best fit for them. The entire process of purchasing real estate can be complex and difficult to understand. A qualified real estate attorney can be helpful in making sure that everything is done in the proper manner, order, and time. While the entire process is complex, real estate closings often pose a particularly difficult challenge. There are numerous documents, titles, and funds that need to be exchanged between the buyer and seller. With dozens of documents and transactions floating around, it could become easy for the inexperienced buyer or seller to make a mistake. When purchasing a piece of real estate, it is important to have a knowledgeable attorney on your side to make sure mistakes do not happen.
Required Alabama Real Estate Closings Documentation
At any real estate closing, numerous documents must be signed by buyer, seller, or both. The following documents need to be completed before the closing is official:
- Contact information for all parties involved, including the seller, buyer, and the realtor. Contact information also includes the contact information for lenders, broker, and bankers that are involved in the transaction.
- The signed contract: This is the contract between the buyer and seller for the piece of real estate. Additionally, if there are any addendums to the contract those need to be completed/brought to the closing.
- Home Owners Association contact information and the guidelines associated with it.
- Loan payoff information: This includes all information that relates to the loan to which the seller is agreeing. It includes the loan number, account number, and the social security number of the buyer of the real estate.
- A copy of the mortgage, will, trust, deed, or power of attorney that is required to complete the real estate closing.
- Hazard insurance contact information from the buyer.
The above are required documents at every real estate signing. However, not every sale of property is exactly the same and additional documents may be required. The following are a few documents that may be required at signing in some situations:
- A copy of a Termite Letter,
- Information regarding the home warranty,
- Repairs that the buyer requires to be complete before the closing – this can also include invoices for repairs already made, and/or
- Approval letters that permit one, or both, of the parties to be able to utilize a Power of Attorney.
There are only two states in the United States that require an attorney to be the one to draft and prepare all of the legal documents that are used or involved in a real estate transaction. The term “legal documents” generally refers to deeds, titles, Power of Attorney, and Termite Letters. This is not an exhaustive list, but the general list of documents that need to be prepared by an attorney.
In addition to Alabama law requiring certain documents to be prepared by an attorney in a real estate transaction, there are benefits to having an attorney help you throughout the process of purchasing real estate. For example, while purchasing real property, there may be times when an attorney’s negotiating skills will be useful. If the home, or property, requires repair before purchase, an attorney can help you to negotiate who will be responsible for paying for the repairs. Additionally, an attorney can help to explain any hard to understand legal jargon in documents. Contracts and other legal documents are not always the easiest to read and understand, but an attorney can help you digest the information and know exactly what you are signing. Finally, an attorney will be helpful in any other situation that requires legal knowledge to give you the best result in your real estate transaction.
If you are purchasing a piece of property in Alabama, trust the real estate attorneys at Massey, Stotser & Nichols, PC. We know that the purchase of real property is equal parts exciting and daunting. Let us handle all of the complexities involved with the purchase so you can focus on the excitement of acquiring new property. We even offer a video conference real estate closing option to increase your convenience during the closing paperwork.