CHIEF RABBI, HACHAM SHAUL KASSIN 5681 – 5779 / 1921-2018

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By: Karen Behfar

Purchasing a home is an exciting time, but there are many steps and processes required before the home becomes your own. To complete the real estate transaction in New York you will want to work closely with a real estate attorney when closing on your new property.

When you begin your journey and get an accepted offer, there typically is a deal sheet/term sheet that is sent to both attorneys. Your attorney will conduct a full review of the contract and will make changes as needed. Once the review is complete, you will sign the contract.

Talk to your attorney about who needs to be present during this first contract signing. Additionally, during this step in the process the buyer will need to provide the agreed upon portion of the down payment to be paid to their attorney. This is typically 10 percent, but can be less depending on neighborhood, and situation. If a home buyer is selling their home simultaneously it's typical to put down less.

Both parties sign, and the contract is fully executed, and now the mortgage process can begin.

Once you have a mortgage commitment, you're ready to schedule closing.

A walk-through of the property is
generally done a day or two before closing.
A walk-through allows you to ascertain that the home is in the same condition as when you went into the contract. We also make sure that the home is “broom swept clean.” Kudos to the sellers who take great care to leave the house as presentable as they would want to find it. It's an uneasy feeling when the walk-through is taking place and the house was left dirty, and not presentable. Besides the sellers having a legal obligation to have the house “broom swept clean” it leaves a bad taste with the buyers. In short,leave the house presentable!

 Once sitting at the closing table, the buyer will sign all the paperwork that has been prepared. Be aware that this process can take some time, and there are more than just one or two papers to sign. Actually, there is an insane amount of papers to sign, so make sure you're well rested. You will typically sign the documents at your attorney’s office. However, before any final signing occurs, a few things will happen:

The attorney will draft up all paperwork to transfer the deed.

The buyers will be informed of their final closing costs. This will include the down payment on the home, all closing costs, any unpaid taxes or utilities, etc.

In addition to signing the papers, the buyer will also pay their attorney the final closing cost in the form of a cashier’s check.

Once all documents are signed and the transaction is recorded, the buyers will receive their keys and the home officially becomes theirs.

Real Estate 101:

Essential Terms Explained

When you are buying a home, particularly a first home, there are many terms you may hear that can leave you confused. Here are several real estate words that you should know before you begin your house hunt.

 Deed:A house deed is a document that shows who the current owner of the property is. When you purchase a home, both the buyer and seller must sign the deed to transfer ownership of the property. When you purchase a home, you will need to sign the deed and file it with the appropriate government agency. You can speak with your real estate attorney for more information on how to properly file this vital document.

 Mortgage:A mortgage is a loan you receive from the bank to purchase your home. The type of loan you receive will depend on how much of a down payment is required and the term conditions. In most circumstances, you will have a monthly mortgage payment that is comprised of the principal amount, interest, and taxes. If you paid less than 20% of the home’s purchase price as your down payment, you will also have mortgage insurance included in your monthly mortgage payment (called PMI –
Private Mortgage Insurance).

 Escrow:The definition of an escrow is when an impartial third-party holds onto something of value during a large transaction, such as when purchasing a home. This means that when you purchase a home and provide escrow money, that money goes into an escrow account. And for sellers, the deed is placed into escrow until they receive payment for the home. Escrow is just a safe way for both parties to receive what is agreed upon. Generally, the down payment is held in the seller's attorney’s escrow account. I have seen some cases where a third party is requested, although this is not routinely done.