You have just bought your new home and you are thrilled about the fast approaching closing date. But just what should you do before that day to ensure a quick and easy transition? This article aims to educate purchasers on the tasks that should be completed prior to closing.

As a real estate agent, one of the mistakes I have seen many purchasers make just prior to closing is taking on additional loans and debts. This can have grave consequences. Many buyers mistakenly believe that once a mortgage approval has been granted, the lender will close the file. This is not necessarily the case. In many cases (particularly with longer closing dates), a lender will run a second credit check just prior to the closing date. If it is determined that the purchaser has significantly more debts, this may jeopardize the mortgage loan. This is because, when approving mortgages, banks factor in the client’s debt ratio. The maximum total debt service ratio (TDSR) a lender will typically allow is 40%. This means that 40% of an individual’s (or couple’s) gross income can be used to service the mortgage payments, property taxes, one half of the maintenance fees (if applicable), plus any outside monthly obligations that are reported on your credit bureau. If you were on the upper limit, and you have since added significant debts, this may put your TDSR above 40%. If you want to buy furniture, appliances, etc. and you don't have any margins (based on your TDSR), it is prudent to wait until after closing to make these purchases.

Another area of trepidation I wish to expand upon is “buyer’s remorse.” It is important to understand that some buyers experience this emotion between the time they make the offer and the closing date. This is a very common sentiment and I have witnessed it on many occasions. As the closing date approaches, many thoughts race through a buyer’s mind. I remember when I bought my first property (a townhome - many years back), I often was very anxious. I felt as if I was now tied down because of this acquisition. I also questioned if I was making the right decision, etc. These thoughts are all quite normal. In most instances, once moving into the new home, all these negative feelings typically fade away quickly.

An often overlooked exercise that all buyers should complete before closing, is notifying all relevant contacts of an address change before you move to your new residence. This includes contacting: the post office, your insurance company, the movers, all utility companies, any newspapers that are currently being delivered, etc. Some utility companies need at least 10 days to get things up and running. The transition to a new home is made much easier if all necessary parties are notified well in advance of your move.

It is also important to explore your moving options well in advance of your closing (particularly during the summer months). It is advisable to obtain a couple of written quotes from moving companies, before choosing one. These quotes should be as detailed as possible. Over the years, I have had some very positive moving experiences, and one very disappointing one. I hired an inexpensive moving company and practically all my belongings were damaged. If you have possessions you highly value, I strongly recommend you use a reputable firm that carries significant insurance.

Most real estate agents will advise their clients that if their closing date doesn't fall at month’s end, then the bank will make an interest adjustment on the mortgage. In other words, the lender will require you to prepay the "interest" on your loan that accrued from the day of closing to the end of the month. This will mean additional cash is required to close the deal. When doing their budgets, some buyers aren't aware of this potential expense.

What about the last viewing of your new home? Ideally, this final showing should be done as close as possible to closing. During this visit, it’s important that the buyer takes their time to ensure that chattels, such as appliances, are all in operating order. Also, check items such as light switches, faucets, shower heads, and toilets. This last visit should be a comprehensive inspection of the property. You want to ensure all the promised repairs have been completed and that all the promised chattels are present. If this visit reveals deficiencies, it is important to contact your real estate agent as soon as possible so they can try to remedy the situation prior to the closing date.

The last part of the process is the actual closing. A few days prior to this date, the lawyer will ask you to bring in a set amount of money. These funds must be certified. They represent the difference between the deposit and the total down payment being put towards the purchase price, plus the closing costs. Of course, when you are meeting with your lawyer, you will sign all the necessary documents in preparation of you becoming the new home owner. Then, on the closing date, the property will be transferred to your name.

By planning in advance, the entire buying process can be both simple and enjoyable.