As Settlement Nears, Mind the Many Details

Plenty of choices, solicitous sellers and time to think about a home before writing a contract allow buyers to be pretty confident these days.

But don't risk a rocky settlement. Make sure you or your agent keep track of all the necessary details between contract and closing day.

Once you have a ratified contract in hand and your check for earnest money has been deposited into escrow by your agent, real estate company or title agency, you're on your way. "That starts the wheels rolling" toward the closing, said Debbie Tritle, an agent with Weichert Realtors in Fairfax County. If you don't have a legible copy of the contract, make sure to get one from your agent, Tritle said. In September, agents in the Washington area started using a new contract with a larger, more fax-friendly type face, she said.

Next, get a copy of the homeowners association or condominium documents, usually referred to as "condo docs," and review them. The amount of time you have varies among jurisdictions and also depends on whether a home is new or resale. For example, in Virginia and the District, buyers of resale condos have three days to review the purchase; in Maryland, they have seven.

"No official approval [of the docs] is needed. If the buyer does not object to the sale after three days, the contract continues -- a non-response from the buyer assumes approval," Tritle said.

Make sure the documents allow your pet to live in your new home, or decide if you can live with a rule restricting, for example, your porch-railing paint color to Colonial blue. If you can't, you will want to let the seller know you are withdrawing from the contract as soon as possible.

Otherwise, "you'll waste days into a ratified contract" that you and the seller could use to look for a better match, Tritle said.

Another reason to get the homeowners or condo docs out of the way is to make time to focus on the most important decision of the buying process: the loan.

Though the lending process is fairly streamlined, buyers should still monitor the process, said Kris Hunnicutt, vice president at First Savings Mortgage in McLean. Follow up on the appraisal to ensure that it occurs well in advance of closing, make sure the lender has the proper documentation to write the loan (W-2 or recent tax returns, pay stubs and documentation of assets or gifts) and make sure the lender is aware of cash awarded the buyer from the seller in lieu of making repairs.

Decide whether you want to lock in interest rates. Buyers can lock in their rate any time between ratification of the contract and 72 hours before closing.

"The lending process has become much more efficient than it used to be. Everything runs through an automated system so that by the time a contract is ratified there's very little to do for the lender," Hunnicutt said.

If something is going to go wrong between ratified contract and closing from a lender's perspective, it most often involves the appraisal, Hunnicutt said. "I have heard horror stories. . . . A lender didn't order the appraisal until the last minute" and when the "appraisal came in low" the buyer was able to renegotiate the contract.

Hunnicutt believes that's a poor way to do business. "I've been doing this for 20 years and we've never had an issue we couldn't resolve. I've never had someone not go to closing," she said. "We really don't have any worst-case scenarios. We deal with everything upfront."