The purchase of a new home is one of the most important investments in a person’s lifetime. It takes a thorough understanding of the home buying process to help you make informed decisions on issues you will likely face along the way.

Taking the First Step
Before considering where to find your new home, it is important to contact a Realtor to help you look.  Realtors are licensed professionals that can help take the guesswork out of identifying areas, features, and types of homes you may like.  No one can help you find the perfect home like a great Realtor can!

Like most people, you may find that there are as many different choices of homes available as there are Buyers for them.  No need to worry… your Realtor will use his or her experience to help you focus on how to find just the right home for you.  He or she will ask you specific questions to determine your needs, and then will use a network of resources to create a list of homes for you to consider.

Applying for a Loan
You should meet with a loan officer, or mortgage professional, to assist you in applying to finance your new home purchase.  The loan officer will handle all of the important documents and help you gather the information a lender will require in order to process your loan application.

Before you put a contract on the house you have chosen, you should receive some information about the closing costs.  Within 3 days of your loan application (if purchasing your home with a loan), your lender should give you a Good Faith Estimate of your loan costs to avoid surprises at settlement.

Please see Closing Costs for more information.

Sales Contract
Once you have chosen your new home and have received your Good Faith Estimate, your Realtor will help you prepare an official sales contract to make an offer of purchase.  The type of sales contract varies state to state.  For example, Maryland’s sales contract can be either a regional contract, which is used in the greater Washington, DC metropolitan area, or a MAR contract, which was(created by the Maryland Association of Realtors.
 
While designed to be as comprehensive as possible, there are sometimes certain local issues that sales contracts may not cover.  When this is the case, your Realtor can prepare an addendum that specifically deals with the point or item of interest and can be easily made a part of the contract.

On Your Way
When you have made an offer of purchase on the home you want and the Seller accepts it, your contract is ratified, meaning the Seller has agreed in writing to all the terms of the sales contract and any addendums.  The countdown to settlement begins.  You may shop for title insurance, you and your loan officer complete the loan application, and your loan officer submits it for final approval.

If your loan application is approved, your lender will send out confirmation and will coordinate the remaining details with your MAXIMUM Team, including management and receipt of the loan funds for your purchase, the important documents related to the loan, and the preparation of a final “loan package” for your signature at settlement in the title company’s office.

Depending on where you live, if you give the seller an earnest money deposit, your MAXIMUM Settlement Specialist will deposit it into an escrow account where the funds are held until closing.

Preparing for Settlement
Prior to the day of settlement, our Team of skilled professionals order a title search and a location drawing, or survey.  These items provide an examination of the history of ownership and a description of the property lines of the home and lot you are purchasing.  Once we determine that title and location drawing are clear and not subject to any claims or defects, we prepare the necessary documents for the you and the Seller to sign that legally transfer the property to you and indicate your legal ownership.

Additionally, we contact your lender to make arrangements to receive the necessary loan documents and loan proceeds you need to make your purchase and complete your transaction.  If your sales contract calls for paying off a prior mortgage, your MAXIMUM Processing Specialist will order the payoff figures from the existing lender.  In addition, your MAXIMUM Processing Specialist will handle loan assumptions, order property inspections, request termite reports, and order a survey.

Your MAXIMUM Processing Specialist will initiate a title search to begin arranging your title insurance.  A title search is the search, perusal, and review of all publicly recorded instrument documents which affect a specific parcel of land to determine the present condition of title.   An experienced title officer or attorney analyzes the searches resulting material and then determines if the title is sufficient and insurable.  It can reveal issues such as title defects, liens, unpaid taxes, unsatisfied mortgages, judgments against buyers or sellers, restrictions or conditions that limit land use, and any other encumbrances and restrictions.

Please see Why You Need Title Insurance for more information on the title search.

The Survey
A survey is a map or plat drawn that represents the property surveyed.  It can show the location of structures on the property, boundary lines, easements, encroachments, government restrictions such as a Building Line Restriction, and can sometimes include topography.  All of these matters are valuable knowledge for a homeowner.

Generally, it is important to have a house location survey done in association with the purchase in order to disclose some unknown issues such as conflicts between easements and current property conditions.  Loan policies usually require surveys.  Although they are not always required for owner’s policies, they are always recommended.

The HUD-1
When all of the proper fees are collected and the title to your home is clear, your MAXIMUM Team prepares your final HUD-1 Settlement Statement, which is required to be filled out prior to finalizing your transaction.  It is a balance sheet that shows the amounts being debited from and credited to the Buyer and Seller in addition to other detailed information such as loan amount, purchase price, and more.   Before you close on your purchase, you should review your final HUD-1 to verify all included calculations, amounts, and information.

Please see Closing Costs for more information and a detailed description of the HUD-1 line items.

Buyer’s Bottom Line & Loan Package
As a Buyer, when you will receive your bottom line figure depends on the final loan package delivery and the time of month, but is usually 24-48 hours in advance.  However, if your lender delays delivering the loan instructions or your settlement falls on a Friday or at the end of the month, your receipt of the bottom line figure will be delayed.  Because three-fourths of all real estate transactions close in the last few days of the month, you may want to consider avoiding the end of the month rush.  Closing in the earlier part of the month helps to avoid delays and enables you to receive better figures as early as possible.

To receive a reviewable loan package prior to closing, you may request one from your lender or ask your MAXIMUM Settlement Specialist to attempt to retrieve the package from the lender early.  It is often a difficult task because loan packages do not normally arrive until the day of closing but, with proper notice, it can be done.  Some standard documents are available for download on both the Fannie Mae and Freddie Max websites if you care to review them, but specific lending institution documents will have to come directly from your lender.  Your MAXIMUM Settlement Specialist can deliver our available internal documentation to you upon your request.

Closing Day
A lot of hard work and time goes into getting you into your new home and it all comes together at settlement when the property transfers from the Seller to the Buyer.  At MAXIMUM, we have you covered and everything will be ready for your arrival.  Your MAXIMUM Settlement Specialist will explain and have you sign a number of documents.  The process may be a little overwhelming so please do not hesitate to ask any questions.  When it is all finished, you will be a homeowner!
 
Buyers need to bring a government-issued photo ID, their lender paperwork, a cashier’s check to cover closing costs, and their hazard insurance paperwork.  Sellers should bring their government-issued photo ID, receipts for any work they have had completed, keys to give to Buyer, and a cashier’s check or wire instructions (if applicable). 

Bringing Funds to the Table
Whether you are the Buyer or Seller, if you need to bring money to the closing, it should be in the form of a certified check, cashier’s check, or bank wired funds.  Because an exact figure is typically unavailable when you obtain your check, we recommend that you use the figure provided in your lender’s Good Faith Estimate plus extra funds to cover any inaccuracies in the estimate.  Your MAXIMUM Settlement Specialist will issue you a reimbursement check at settlement if you bring too much money. 

Please note that if you, as the Buyer, intend on using assigned funds as a down payment, you must inform the Seller, receive prior written consent, and obtain MAXIMUM’s approval in advance.

Settlement
A closing, or settlement, is the conclusion of a transaction where title to a property is transferred from the Seller to the Buyer and includes delivering the deed, signing notes and security instruments, disbursing funds necessary to finalize the sale or loan transaction.  MAXIMUM typically holds the closing in one of our branch offices; however, you may schedule a different location with your MAXIMUM Settlement Specialist.

At settlement, a MAXIMUM Settlement Specialist will first explain the HUD-1 in great detail and to your complete understanding.  Throughout the rest of the settlement you will sign several more important documents related to your new home purchase and your receipt of title.  These instruments range from simple disclosures about taxes, and insurance, to important commitments and affidavits regarding your loan, title, and title insurance.

Seller Proceeds
Time periods for proceed disbursements varies from state to state.  In some states, funds may be disbursed the same business day as closing while other jurisdictions can take up to 48 hours because the transaction, by law, must first be recorded.  Friday and Holiday weekend settlements may also delay disbursement. 

With MAXIMUM, you may choose your disbursement method. Simply let your MAXIMUM Settlement Specialist know if you would prefer a physical escrow check or if you prefer to have the proceeds wired directly into your bank account.

Post- Settlement Activities
At the conclusion of settlement, MAXIMUM will issue your title insurance policy and record the Deed.  With the Deed, there will also be a recordation of the Deed of Trust, a document you will have signed at settlement securing your lender’s interests in the monthly repayment of your loan.  We will make all necessary disbursements required at settlement and any additional disbursements thereafter, including payoff the Seller’s lender and obtain a release of the Seller’s prior Deed of Trust.  After a final audit of our disbursement list, your lender will receive a package containing all of the signed documents.

Filing a Claim
Your owner's policy is intended to provide you with peace of mind about your real property legal rights. If you have questions or concerns about your rights or are unable to locate your policy, you should promptly notify your MAXIMUM Team.  You can confirm whether you purchased a policy by checking line 1110 of your HUD-1 Settlement Statement.
 
You will not lose your property if you have a problem and make a claim.  If there is a possibility of an unfavorable claim against your title, you should contact your MAXIMUM Team as soon as possible.  Your owner’s policy covers legal expenses that may be necessary to investigate, litigate, or settle the claim.

When giving notifying MAXIMUM of a potential claim, please include the following items:

• Your property address
• A brief statement of your concern
• Copies of any claims documents
• A copy of your owner's policy (if available)

Your title insurance policy’s broad coverage includes protection against frivolous claims that may present a future problem so you should contact your MAXIMUM Team promptly when you have any question or concern about your legal rights.