A lot of details go into the last 45 days of a new construction home to get it ready for a successful close. This New Construction Closing Checklist is built to cover the major milestones, inspections, and paperwork that will help your closing be smooth and feel confident when you get the keys to your new home. We’ve used our decades of experience to provide a comprehensive checklist. Team Reith is here for you and will guide you through all the steps. The following information will hopefully be a good resource for you throughout the remainder of the process. PLEASE TAKE OUT A FEW MINUTES TO READ THIS THOROUGHLY. If you have any questions or new things pop up simply give us a call and we will work with you to figure it out.
Get Excited!
Your New Construction house is finally nearing completion! We’ve been watching all of its progress silently in the background for months (or weeks in the case of inventory homes) and now you are entering into the final 45 days where we are allowed to be part of the process again. We are; however, still at the mercy of the builder & the lender in terms of dictating timelines and procedures.
Home Inspection
Home inspections are optional in a new build, but we do encourage you to consider having one done. Just because it’s new doesn’t mean it’s free of issues with wiring, plumbing etc. An inspection will give you peace of mind or alert you to issues before you close on your home. An inspection will cost you approximately $400 and we can set it up for you and attend for you if you need us to. Our recommended inspection companies have inspection packages specifically for New Construction. We will make all necessary arrangements with the Construction Manager for your inspection if you decide to have one done. Some builders have a program where they have the home inspected by a third party. In that case, it may not be necessary to have another home inspection done. Also keep in mind that most builders have a first year “bumper to bumper” type warranty. Anything that results from poor construction will be covered for the first year. The same inspection companies also offer an “end of warranty” inspection package which will create a list of anything that needs to be addressed by the builder before the warranty expires on the first year closing anniversary. Please feel free call us to discuss your options as every situation is unique. If you think you DO want to have one done, please notify us immediately so we can work within the builder’s schedule.
Homeowners Insurance
If you have not decided on an insurance provider at this point, now is the time. It is a requirement that you have a homeowner’s policy on your home if you purchase with any type of loan. The builder is going to offer you insurance from their company. In fact, it is even mentioned in the contract that they will provide your insurance, but we encourage you to compare policy coverage limits and not just go for the lowest price. Builders are notorious for offering a low-price option that doesn’t really provide much coverage when you need to use it. You must have your Homeowners policy set up within 14 days of closing. It is a good idea to use a local agent who can offer several different insurance company options to you through one agency. We have a few agencies that we work with on a regular basis who can send quotes to you if you do not already have a local insurance agent that you work with. Our preferred agents can be found on the Preferred Vendor List. Once you select a policy, your insurance agent will send an insurance binder to the lender, which is needed to get final loan approval. You will pay your homeowners insurance premiums as part of your monthly mortgage payment. Your lender will have already allowed for this in your quoted payment estimate. You monthly premium will likely range from $100-$150/month depending on your situation.
Loan-Conditional Approval
Any day now you will receive a “Conditional Approval” from your lender containing a long list of items that you need to deal with in order to achieve your final loan approval. Don’t be alarmed by all of the conditions that you receive. EVERYONE gets a condition list. Just plow through them one by one as soon as possible.
VERY IMPORTANT
Be mindful in your answers to questions from your loan processor. They work for the lender, not you. They have the power to make or break your loan approval. Answer their questions precisely and do not offer additional explanation, especially if you are self-employed. If you are in doubt at all about how to answer, ask your Loan Originator. If in doubt, ask us.
Appraisal
Your lender will require that you have an appraisal done on the property approximately 2 weeks prior to closing. The lender makes all of the arrangements for the appraisal. This is the only item, besides the home inspections that you will need to pay for upfront, prior to closing. The purpose of the appraisal is to determine that the property is “worth” the value of the loan. This value is determined by comparing home sales in the same neighborhood over the most recent 30-60 day period. In most new construction cases, the appraisal is in two stages, the first main appraisal and a follow up once the house is complete. Don’t be surprised if you see 2 charges from the appraisal company.
Keep Your Credit Score Clean
REMEMBER, DON’T PURCHASE ANYTHING ON CREDIT WITHOUT CONSULTING YOUR LENDER– Everything you do can affect your loan approval, rate etc. so for the next 30 days always think before you buy anything beyond normal living expenses. When in doubt, ask your Loan Originator before buying. Avoid things that are red flags for credit inspections like signing or co-signing loans, quitting your job, or opening new bank or credit card accounts.
Closing Letter
The builder’s title company will send you a closing letter at approximately the 30 days to closing mark. They will usually cc me on the message, but I never count on it, so please forward the message to us if you don’t see us listed in the cc section of the message. This letter will announce your closing date and will state that they will be in touch with you to schedule a specific time when they are closer to the actual date, as well as give you the specific location for closing. They will provide you wiring instructions for your final cash to close amount which will be determined 48 hours before closing and should be wired the day before.
REMINDER, WIRING INSTRUCTIONS WILL NEVER COME FROM US, ONLY FROM THE TITLE COMPANY IN CHARGE OF YOUR CLOSING! IF YOU RECEIVE AN EMAIL FROM “US” CONTAINING WIRING INSTRUCTIONS IT IS LIKELY A SCAM AND SHOULD NOT BE TRUSTED.
Final Loan Approval
Final Loan Approval usually occurs a few days before closing. Once the lender has full loan approval, they will issue you a final CD (Closing Disclosure) to sign. These will be updated numbers from the first CD you received in the first weeks of the contract. When you are notified that the CD has been sent to you for review, drop everything and review it IMMEDIATELY. Your signature timestamp on that document will be the basis of your closing date and time. The interest rate on that CD and the monthly payment will be your actual final figures. Sometimes the final “cash to close” can still change by small amounts in the final days before closing, but the amount listed on the Final CD should be close to what you have been expecting to pay upon closing. If you have any questions on those figures, contact your lender immediately.
Construction Manager Final Walk Through
All properties will have a Home Demonstration meeting 1-2 weeks from closing as well as Final Walk Through 1-2 days before closing. Please make sure that we are made aware of any meetings or inspections that the builder contacts you about so that we can be in attendance with you.
When you see the condition of the house at the Home Demonstration you may wonder how they can possibly complete the home within the following week because there will likely be multiple things not completed. Don’t worry, they somehow manage to get it all done. The builder cannot receive the CO (Certificate of Occupancy) without passing all county inspections. Without a CO, the builder cannot close. If they ask you to sign an “Exception List” at the Final Walk Through, you don’t have much choice but to sign it, but there should be very few items on the list at that point and signing the document assures that the builder is obligated by law to complete the listed items in a timely manner. These items usually only occur when something is back ordered and does not affect the receipt of a CO from the county. Also remember that builders offer a one-year warranty on the home, so you have that to back you up, which should provide peace of mind should you have a few small items not completed at the time of closing.
Utilities Start Ups
You may contact the utility companies 3-5 days prior to closing day to arrange start up. The builder will pay for the day of closing, so set it up to start the day after. We will send you a list of utility company contacts about a week prior to closing.
List of Recommended Vendors for all Services
We have a comprehensive list of our preferred vendors for just about any service you could need as part of the preparation for closing of a New Home Construction. This includes Home Inspectors, Movers, Water Purification Systems, Security & Smart Home Tech, Handyman etc. They are businesses whom we know that we can trust to do a great job for you. In most cases we have more than one per category listed and we encourage you to get a quote from each one. They are listed in our personal preferential order. We are always happy to contact any of them for you to have them call you. Think of us as your Project Managers, we can make any arrangements on your behalf upon your request. We like to take care of our valued clients.
Trust Team Reith for Your New Home Construction Closing Needs
Buying a new home construction is exciting. We are proud of the hundreds of clients who have entrusted Team Reith to help with their journey of purchasing a new home construction in Greater Tampa Bay all the way to completion.
