Taking Properties Into a Land Trust
Closing Preparation Checklist
Steps to be finished before Closing for Buying Properties:
1. Order Title Search From Lawyer or Title Company: if it is a foreclosure situation, you must put a rush order on the title search.
2. Insurance Binder: call insurance broker and get insurance binder for property so that insurance is in place the day of closing. Make sure lender’s name is on policy as additional insured.
3. Lead Violations/Building Violations: Call the city and see if there are any outstanding leads or building violations against the property.
4. Condo Docs/Resale Certificate: If it is a condo, call the condo management company and make sure the seller has obtained a copy of the condo docs and a 6D certificate.
5. Water Company: call the water company and get the water bill changed over into company name set for the day of closing.
6. Sewer Company: call the sewer company and get the bill changed over into company name set for the day of closing.
7. Gas Company: call the gas company and get the bill changed over into company name set for the day of closing.
8. Oil Company: make sure there is enough oil to last 3 months.
9. Electric Company: call the electric company and get the bill changed over into company name set for the day of closing.
10. Traditional Mortgage(s): Check with mortgage broker or loan officer to get all paperwork, appraisals, fees, etc. done on time; get loan commitment and closing date commitment.
11. Mortgage(s) for Private/Hard Investor(s): call lawyer and tell him who will be sending money over if private or hard money lenders are involved, who needs to have a mortgage, and what the terms are.
12. Call Private Investors to send over money: call all private investors for that project and have them send over money to the lawyer. Give them the wiring instructions as well as the address of the lawyer.
13. Company Funded: if the company is purchasing the property with its own funds, call and get amounts that will need to be brought to closing the day before the closing.
14. Certificate of Good Standing (if buying in business name): bring original to close. You can order through your secretary of state.
15. Change of Management Letters: Create and send out letters to all existing tenants that there will be a change of management with a new application for them to start filling out with our information. Have the seller sign the letters.
16. Signed and Notarized Quit Claim Deed: for all properties we are buying, whether a short sale or an equity deal, and for short sale properties or any others where the seller is not going to be at the Close. (Some sellers will sign the deed at closing.)
17. Signed and Notarized Limited Power of Attorney: required for all properties where the seller is not going to attend the closing.
18. Get smoke and carbon monoxide detectors installed: check the fire department of the individual town to find out where the detectors need to be installed and if they need to be hard-wired; Get homeowner to install or, if need be, buy them and have them installed.
19. Set up smoke inspection at least one week before the close: find out how much it costs and if you have to pay in advance; Get receipt and a copy of the check if we pay it.
20. Set up water reading 2 – 3 days before the close: Make arrangements to have the water paid on the HUD if possible. Otherwise, we need a receipt and a copy of our check. Get a faxed or scanned copy of the water reading that can be turned in at the close.
21. Title V Report: If the property has a septic tank make arrangements to have a title V inspection completed.
22. Keep in contact with the closing attorney: make sure that the closing attorney and mortgage broker have all the information they need in order to close. For short sales, they will need copies of the acceptance letters from the banks, the preliminary HUD, an invoice from our company for our commission (if applicable), copies of any receipts we need to be reimbursed for, the signed purchase and sale, Title V certification if on septic, water reading, smoke certificate, power of attorney, signed deed.
23. Check preliminary HUD against closing attorney final HUD draft: make sure negotiated figures are the same and that final HUD will be acceptable to the banks.
24. Find out close location and time: if there is one individual who has limited power of attorney, see to it that they can attend the close.
Day before Closing
25. Get Copy of Insurance Binder: Call insurance company and get a copy of the insurance binder faxed over so that we have it at closing.
26. Check over the draft of the closing HUD: make sure numbers are what you thought they were supposed to be. If it is a short sale, make sure they agree with the preliminary HUD you sent the bank.
27. Coordinate Closing Times with Seller and Lawyers: Call ahead of time to see if there are any final adjustments.
Day of Closing
28. Final Walk Through: Do a final inspection of the property the morning of the closing to make sure there is no additional damage.
29. Coordinate Closing Times with Seller and Lawyers: Call ahead of time to see if there are any final adjustments.
30. Get Copies of All Closing Docs: make sure all closing docs are in the closing folder.
Steps after closing (at the Court House / City Clerk’s Office)
31. File the Quit Claim Deed: Lawyer may do this.
32. Get copies of Final Documents: Quit Claim Deed, final HUD, any surveyor’s plans
33. Get copy of Title Insurance Policy: Obtain this from the lawyer
Preparing Closing Folder
34. Closing Folder: Go through and make sure checklist is completely finished and prepare the closing folder and transfer it to the properties owned file.