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Buyers Often Ask... Why Can't I Get My "Final Figures"?

One of the things that seems to occasionally frustrate home buyers... is the inability of their title company to provide "closing figures" to the homebuyer within a time frame that is from 24 to 48 hours before closing.

In the Fort Worth, Texas area... our closings are done with "closers" or escrow agents at title companies.  Both Realtors and Buyers would like to know the buyer's "final figures."

In Texas there are no "round table" closings.  The buyer and the seller each sign their papers separately at the title company... just them, the Realtor (if any) and the title company closer or escrow agent.  It is an extreme rarity that an attorney would be present at closing... for either buyer or seller.

The "final figures" represents the exact amount of money the buyers must bring to their closing... in the form of an official bank check.  Because of that... if that figure is not known until just hours before closing... it becomes a hardship for the buyer to get to their bank... get their cashiers check... and then get to the title company on time.

So why can't they get us the number sooner ?

One of the main reasons is that this "number"... this amount... is the total of many different amounts that come from many different places.  Here are a few of them:

1)  Home owner's insurance.

2)  Title costs.

3)  Real estate tax figures from the various taxing agencies... city, county, school district, water district...and so forth... as far as the number of months of taxes to be collected up front.

4)  Mortgage closing costs... application fees, appraisal fees, document preparation, courier fees, pre-paid interest... the list goes on and on.

5)  Balance of down payment.

6)  The amount, if any, of the buyer's closing costs that are being paid by the seller... per an agreement in the purchase contract.

7)  HOA (Home Owner's Association) fees that must be paid.

8)  Buyer's Home Warranty Service Agreements... whether paid by buyer or seller

9)  Costs of any repairs made at buyer's expense that must be paid at closing.

10)  Even the amount of taxes the seller owes on the property must be known... because that amount is then credited to the buyer on the closing statement, and offsets a part of the money due from the buyer.

All of these figures must be verified and in the hands of the title company before they can figure the the closing amount.  Then... the entire closing statement must be sent back to the buyer's lender to be approved.  Once the final approval of the closing statement is made... only then can the buyer be given an exact figure.

There is also a possibility that other changes could be made... even while the buyers are signing papers.  IF that happens, the closing statement is amended, then sent back to the lender... and must be re-approved by them, then sent back to the Title Company... and then signed by the buyers... and the previous one discarded.

Comment balloon 10 commentsKaren Anne Stone • September 13 2008 10:57PM

Comments

Hi Haren;

Great post and very informative. I will book mark for future reference. Thank you for sharing.

Posted by Anthony Stokes-Pereira, Realtor (Better Homes and Gardens Rand Realty) over 9 years ago

Karen, I liked the detail you provided as to how the various components of the settlement costs are tallied up.

Posted by Gary Woltal, Assoc. Broker Realtor SFR Dallas Ft. Worth (Keller Williams Realty) over 9 years ago

Karen,

Getting the final figures early is often difficult for the reasons you explain above. So many different entities are involved and there is always one, or two, that is late with its numbers.  

Posted by Esko Kiuru over 9 years ago

I agree. I had a $7,000 pre payment penalty that did not show up until a day before closing.  I really needed that figure A.S.A.P.

Posted by Dinah Lee Griffey, Managing Broker Windermere Peninsula Properties (Windermere Peninsula Properties) over 9 years ago

you are so right - often times buyers here will wire the money instead of getting a cashier's check - but still we need the #### - nice to see you Karen Anne

Posted by Thesa Chambers, Principal Broker - Licensed in Oregon (Fred Real Estate Group) over 9 years ago

Karen, I know that it is certainly frustrating for buyers that the final figures cannot be obtained earlier.  However, if a lender gives an accurate and conservative Good Faith Estimate, the buyer should have a pretty clear picture of how much to bring to settlement.  I always advise clients to bring slightly more because the title company can cut a refund check right there at settlement.  While the settlement company will require a cashier's check for the bulk of the costs, most here will also accept up to $1000 in a personal check to make up any discrepancy.  You gave a nice explanation of why.

Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) over 9 years ago

It even frustrates me. I hate to go to a closing where I have not seen the drafts of a HUD or anything else. So I know buyers hate it.

Posted by Chip Jefferson (Gibbs Realty and Auction Company) over 9 years ago

I always enjoy reading your real estate posts, Karen - you have some a wealth of knowledge and experience to share!  I agree with you that getting final settlement numbers is a great frustration for home buyers, and it's helpful that you're spelling out some of the details that go into this.

Posted by Margaret Woda, Maryland Real Estate & Military Relocation (Long & Foster Real Estate, Inc.) over 9 years ago

Karen Anne - what a great post. As you know, we also have the escrow closing in Cleveland. It's always hard to explain why our title companies do not give the exact number sometimes till the last minute before escrow. Even when we explain all the details to our buyers, they still want less stress and more stability prior to closing. Your list makes it easier. Thank you!

Posted by Svetlana Stolyarova, Local-n-Global Realty, Broker 216-548-4663 (Local-n-Global Realty, Cleveland and International Real Estate Solution) about 9 years ago

No one had ever explained that to me before.  Thanks for the clear information, Karen Anne!

Posted by Ron Marshall, Birdhouse Builder Extraordinaire (Marshall Enterprises) almost 5 years ago

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