The last week under contract is less chaotic than the first two, but probably the most stressful. Everything gets really REAL. You are so close to home ownership that you can taste it, but you’re not in the clear yet, so you have to be on your Ps and Qs.
At the beginning of the week, our agent informed us that our Loan Objection deadline was approaching. The Loan Objection deadline is the last possible day that we can get out of the contract and still get our earnest money back, but only if our loan wasn’t approved. There are many reasons why a loan might not be approved at the final hour – change of income, insufficient funds, or change in debt, to name a few. The biggest one to watch out for here is a change in debt.
Our lender told us about people who lost their loans at the last moment because they went buying all kinds of things while under contract. And I totally get it. You go under contract and want to start buying stuff for your new house: appliances, furniture, etc. Unfortunately, those are all big-ticket items so you put that on your credit card and all of a sudden, you’ve increased your debt by a few grand. Depending on where your debt/income ratio and your credit score stand you might be able to absorb a little extra debt without any impact on your loan qualifications. But to be safe than sorry, you should basically freeze all of your extraneous spending while under contract. That meant we didn’t buy anything on credit for the last three weeks that wasn’t immediately necessary e.g. food, gas, tickets to Avengers: Infinity War.
The last week under contract is a bit of a cluster because everyone is going back and forth with each other to make sure things are accurate: you, your agent, your lender, the title company, and the underwriter. Then the loan gets approved. Hooray! You think you’re done, but not yet.
The title company has to clean up all the numbers and come up with the final amount of the check that you have to bring to closing. Our closing was at 4 p.m. and we didn’t get the final number until 2 p.m. Fortunately, I was parked outside of the bank eating a banh mi sandwich from Whole Foods (that I paid cash for) and waiting for Fury to text me the final amount. By the grace of God, there was no line at the bank and everything went smoothly. The teller asked me if I was buying anything special with the money. I wanted to say, “A Maserati,” but I told him the truth: we were buying a house in less than 2 hours. He and the bank manager congratulated me and wished us well and then I was off to pick up Fury and head to closing.
Closing has two official roles – finalizing (i.e. closing) on the loan and transferring ownership of the house from the seller to the buyer. We were 10 minutes late (traffic, not CPT) so we might have missed some stuff, but more or less this is how it went down:
The whole Glam Squad was there (our agent, our lender and us) plus the sellers, their agent, and a representative from the title company. Technically, closing is the first time you meet the sellers but we met them on Saturday during the final walk-through of the house.
I should say a word about the final walkthrough: we did this on Saturday as Mother’s Day was Sunday. The purpose of the final walkthrough is to make sure the sellers did the repairs you requested and to “sign off” on the condition of the house. As we didn’t ask for any additional repairs, we were mainly just walking through, snapping photos, and taking measurements. The sellers introduced themselves and we had a chance to meet their beautiful family. There’s something about meeting the people you are buying a house from that kind of rounds out the deal. You get a chance to tell if these people are decent human beings which was especially important as they would be renting the house from us for a few weeks after closing. The sellers were lovely people and we felt reassured about the rent-back and that the rest of the transition.
Back to closing – the sellers signed some papers before we got there. Then the person from the title company walks us through a couple of papers that we sign along with the sellers. Then the sellers are done and we sign an inch more of paper (no lie, it was an inch) – with the papers mainly saying stuff like ‘Yes, we will pay the mortgage, taxes, and keep insurance on the property and if not, you can kick us out.’ Then after 30 more minutes, you are done. We swapped contact information with the sellers, exchanged niceties with the rest of the crew and spent some time taking photos and hugging the Glam Squad. And then it was done. After four long months of searching, we were homeowners (and landlords!).