Anatomy of buying a home

Real Estate Law Services

Anatomy of buying a home

Buying your home may be one the biggest investments of your life which will take up much of your time and energy before you reach the closing table.

How much money do I need at my closing?

Your Good Faith Estimate of Closing Costs is a document your lender is required to give you and should give you a good idea of the amount you will have to bring to closing. However, they don’t tell you everything. In addition to what your GFE tells you, you will have to pay for prorated taxes, heating oil or propane and whatever inspections you decide to have done.

Click on the sample Settlement Statement below to get a feel how they work (the left hand columns belong to you).

Do I need a real estate attorney?

In Connecticut, all parties are customarily represented by an attorney. We do a lot for you.

1 - From the legal aspect, we search the property’s title and to review it to ascertain whether the seller is able to convey good (“marketable”) title to you. If there are problems, we will work with the seller’s attorney to help resolve them before we close. One of the ways we differentiate ourselves is that we get your title search done early. Most other real estate lawyers in New London County wait until they get title commitment from the lender. While this is practical from a purely financial perspective, its downside is that title problems are not found until near the closing date. Title problems found early on are usually easy to resolve. Title problems found a week before closing cause nightmares; for you, us, and everyone else.

Do I need title insurance?

We will also insure good title through a title insurance company for you, if you choose, and or your lender (you must buy it to get a loan). We STRONGLY recommend that you purchase a "title-plus" Owner's Policy of title insurance with extended coverage benefits. In addition to standard benefits, which insure marketability of your title, you will also be covered other potential problems which may arise with the ownership of your home.2 - From a practical aspect, we, along with your real estate agent, will keep track of your closing, check the progress of your mortgage application and the outcome of the inspections you choose to do.

Should I inspect the property?

Connecticut law requires most sellers to disclose the condition of their homes to buyers through a Residential Property Condition Disclosure Report. Additionally, if the home was built before 1978, federal law requires that you receive lead paint disclosures. The seller is also required to give you any information on any tests done for lead paint on the property

Home inspections - caveat emptor - let the buyer beware. As a general rule, if you do not find a problem during a home inspection, you may ending up absorbing the cost of fixing whatever you did not find. There are many reasons for it, but the probably the biggest one is that hiring an attorney to sue for recovery is usually more expensive than doing the repair. Hire a good home inspector and don’t scrimp. Test and inspect everything (especially for lead for young families).

If problems arise, we can advise you on your legal rights and remedies, but remember that most solutions are derived from people, not lawyers. The most important relationship you might have in this transaction may very well be with the seller.

What about the contract?

In most Connecticut real estate transactions the contract is signed without attorney review. If you have not signed a contract, you may want to have your real estate agent include a provision in any contract you sign that allows you to have us approve your contract.

Your contract will contain a closing date which a GUESTIMATE. The actual date of closing may be a days or weeks earlier or later than the date on the contract. If you to MUST close ON a specific date, tell us immediately.

What happens at the end of a closing?

The “closing” is where you actually take possession of your new home. It is also where you pay for it. Both sellers, buyers, their attorneys and agents will be there. Usually you will inspect the property (“pre-closing inspection”) immediately prior to closing. Any problems found are then, hopefully, hammered out at the closing table.

The seller will sign the deed transferring title to you. You will sign the mortgage documents transferring that title to the lender. This is how the lender helps to ensure its interest in the property is protected. (The lender only has “conditional” title; when you pay off the mortgage, the lender transfers title back to you). You are left with the rights of possession (you can live there) and of equity (you own whatever value there is in the property beyond your mortgage amount).

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