4.0 CLOSING PROCEDURES
COMPLETION OF SALES INFORMATION
a) Allow enough time to close the transaction. Allow time to have all inspections done, a title opinion rendered, to clear title and to prepare the closing papers. If there are delays because of counter-offers, getting out of town signatures, etc. change your closing date and be sure to notify all parties of the change in writing and get documentation signed by all parties.
b) The listing agent will handle all negotiations regarding the terms and conditions of the purchase agreement and the acceptance by the seller.
c) All money to be collected under the terms of an Offer to Buy as additional earnest money or down payment prior to actual closing date shall be collected by the sales agent at the time it is due from the buyer in accordance with the terms of the Purchase Agreement.
d) The buyers agent will make arrangements for placement of the loan application.
e) The agent then follows each transaction and maintains contact with the lender through the approval or rejection of the loan application.
f) The agent will notify the listing agent when the loan is approved.
4.1 PURCHASE AGREEMENTS
The sale begins and ends with the Purchase Agreement. If the Purchase Agreement is not complete or it is not completely understood by both Buyer and Seller, the chances of a good closing are very remote. Write legibly, type where possible. Reread the Purchase Agreement, be sure it states, without a doubt, what the client intended. Your sale will be closed according to the terms in your Purchase Agreement. When accepted, the Purchase Agreement becomes a binding contract.
All written Purchase Agreements must be presented to the Seller. We must have a signed copy of the Purchase Agreement when we close. ALL Purchase Agreements written must be in the listing office closing file. Prepare estimated closing statements for our clients or obtain one from the Closing Attorney or Closing Company.
Should Terms or stipulations be changed in the Purchase Agreement, the listing agent must have an addendum showing the change with times and dates, signed by the Buyer and Seller, in the file prior to closing.
1. All accepted Purchase Agreements must have the following information pertaining to buyer and seller:
a. Present address
b. Phone Number
c. Social Security Number of buyer and seller (if possible) d. E-mail or Web site (if possible)
2. Purchase Agreements must also have the following necessary information: property address, legal description, sale price, tax pro-ration language, date for securing financing, closing and possession dates, sale price on assumptions, inspections, etc.
3. If offer must be sent out of town for “signatures”, a copy of offer with acceptance fax may be substituted pending original offer being signed and returned for our files.
4. In the event an appraisal is low, the agent will be informed by the lender and will be expected to negotiate between buyer and seller. If negotiation is possible, the new offer will be resubmitted to the loan company for approval. If renegotiation is impossible, listing agent should be informed so various charges incurred may be paid and property may be put “back-on-market.”
5. In the event a loan is rejected, the listing agent will be informed. He will be given the opportunity to work out any new avenues of financing, credit, etc. that may be available. All rejections will be discussed with the agent BEFORE they are dropped and the earnest money is refunded and various charges are paid.
6. On sales that have “fallen through” release forms are required, the agent will obtain all necessary signatures prior to the release of earnest money.
4.2 EARNEST MONEY DEPOSITS
Earnest money must be delivered to McCraw Real Estate Broker, no later than the next legal banking day after acceptance of the Purchase Agreement.
Earnest money must be the amount stipulated on the Purchase Agreement. The Company recommends a minimum amount of $500 earnest money. A lesser amount may be taken if buyer doesn’t have as much as $ 500 available.
Cash may be taken as earnest money. The associate shall give a receipt for cash deposits. Cash amounts of $ 10,000 or more, may not be taken as a deposit due to current laws to monitor the spending of large amounts of Cash. In case of a large amount of Cash, associate is urged to ask buyer to go to financial institution and get cashier’s check or certified funds or to write a GOOD deposit check for the amount.
Earnest money deposit checks will be made payable to McCraw Real Estate. Post dated checks ARE NOT acceptable. All checks will be deposited on or before the next banking day after acceptance of offer.
4.3 APPROVED NEW FINANCING
As the sales agent, instruct the loan officer to call you when the loan is approved.
When the lender calls you with loan approval, notify the Closing Attorney or Closing Company so title work may begin.
4.4 TITLE OPINION
The Closing Attorney or Closing Company normally gives the Title Opinion.
4.5 ASSUMPTION PAPERS
This company will not accept any assumption transactions without the seller being released of full liability. Assumptions are very rare in this day and time.
When an assumption Purchase Agreement is accepted the associate will call the lender to see if the Buyer must be approved.
Termite and all other inspections shall be ordered and performed in a timely manner in accordance with the requirements of the purchase agreement. Listing and Selling Agents shall co-ordinate these inspections.
4.7 AMORTIZATION SCHEDULES
Accurate Amortization schedules can be provided to buyer if requested.
4.8 FINAL CLOSING DOCUMENTS
Closing documents such as deeds, contracts, affidavits, declarations, 1099s etc. will be secured by the sales agent for signatures. Included will be an actual closing statement for the buyer and seller, prepared by the closing attorney or company.
All signed closing documents must be in the closing file at time of disbursement of all funds.
Filing and disbursement cannot be made until all funds are collected from buyer and/or seller.
ONLY QUALIFIED CLOSING ATTORNEYS AND CLOSING COMPANIES WILL BE USED TO CLOSE A TRANSACTION.
4.9 DOWN PAYMENT
Transactions cannot be filed or recorded nor any funds disbursed until such time as a personal check has cleared the bank account.
Post-dated checks CANNOT be accepted and will be returned to associates. Checks cannot be held. All checks will be deposited the day they are received or the next banking day.
In the event there is a shortage of funds necessary to settle the transactions, the closing agent may hold the transaction and insist all funds be collected before filing.
4.10 COMMISSION PAYMENT
Upon receipt of all closing documents, proceeds, and reporting of the sale to MLS; commission checks are written. Commission checks will be completed by the bookkeeper no later than 4:00 P.M. the next work day following the transaction closing.
4.11 EARLY POSSESSION BY AGREEMENT
a) Do not give possession of a property to a buyer without a properly executed early possession agreement. We must have the signed approval of the seller and buyer. Both should make sure they have proper insurance coverage on the real property and their personal property within the real property.
b) Any money deposited under an early possession agreement shall be funds payable to the listing broker or directly to the seller.
c) The moving of furniture or other possessions into a property prior to closing of a sale must be approved in writing by both the buyer and seller. The written agreement shall include that the seller is not responsible for the buyer’s property. The buyer should have an insurance policy as above.
4.12 ATTENDANCE AT CLOSINGS
a) The sales agent will be aware of their closings. Attendance is encouraged, as it is excellent public relations. It is best to stay in the background. The client appreciates your assistance. In the event you see that something is not in accordance with the purchase agreement, you should politely call this to the attention of the closer.
The sales agent will have the responsibility to order and receive closing statements in order to verify correctness.
b) Upon receipt, the sales agent will review the closing statement with the client.