Appraisal, Title Search, and Homeowners Insurance: Final Steps Before Closing

As you approach the final stages of your home-buying journey, a few critical steps remain. These include the appraisal, property title search, and securing homeowners insurance. Here’s what you need to know to ensure a smooth path to closing.

Appraisal Ordered

Your lender will arrange for a third-party appraiser to provide an independent estimate of the home's value. This step is crucial for several reasons:

• Fair Pricing: The appraisal ensures that the purchase price is fair for all parties involved.
• Loan Approval: The loan file moves to the mortgage underwriter for final approval, once the appraisal is complete.

If the appraisal is approved, you'll receive your final commitment letter, which includes the final loan terms.

Property Title Search

A property title search is essential to confirm that the seller owns the property and that there are no undisclosed liens, loans, or judgments against it. This step helps ensure:

• Clear Ownership: Verifies that the seller has the legal right to sell the property.
• Disclosure of Liens: Identifies any existing financial claims against the property.

Homeowners Insurance

Before closing, you’ll need to secure homeowners insurance for your new home. This insurance is vital for protecting your investment against potential damages, including:

• Fire
• Storms
• Hail

Having homeowners insurance in place is usually a requirement for the mortgage lender and provides peace of mind as you move into your new home. I have an insurance broker that can shop for you and compare policies and prices for you to help get you the very best deal with the coverage that works for you. Call me at 719-922-0102, as I am happy to make that introduction. 

Conclusion

Completing the appraisal, title search, and securing homeowners insurance are critical steps to finalize your home purchase. These steps ensure that the transaction is fair, legally sound, and that your investment is protected. As you move through these final stages, you’re one step closer to turning the key to your new home.