What You Need To Know About Purchasing A Home

Do you have questions about the home-buying process? Read below for a brief overview of all of the legal steps in your home purchase.

If you have questions or concerns call our Howell, New Jersey, office at 732-639-1952 or 732-895-0109. We have a fully trained and experienced staff to handle all your questions and needs. Your attorney's cell number is provided to you for those times you need to speak to someone immediately.

Step-By-Step Guide To Buying A Home

Attorney Review: In New Jersey a contract does not become binding until the mandatory three day attorney review period is completed. This review allows each side to the deal to examine the contract and make changes or back out if needed.

Attorney review begins on the day after both parties (buyer and seller) receive a fully executed contract of sale. By law attorney review lasts three days, not including holidays, Saturdays or Sundays.

Closing Costs: This is the total amount you will owe when purchasing a home. Your lender is obligated to provide you with a good faith estimate of your closing costs.

Regardless of who you use, make sure you get an estimate. If you would like us to review this estimate, we will gladly go over it with you. Please let your mortgage company know that your lawyer will order title insurance and a survey on your behalf. Title insurance costs are regulated by the state of New Jersey.

In addition to the closing costs quoted by your lender, be prepared to pay an extra quarter of taxes upfront at the time of closing. This is in addition to the three or four months escrow the lender will most likely require at closing. Finally, be prepared to deposit at closing an escrow, usually three or four months of homeowners insurance payments. This is in addition to the year you will most likely be required to pay upfront.

For an estimate on closing costs call us immediately.

Closing Dates: In New Jersey, unless the contract specifically states that the closing date is "time of the essence," the date set for closing is an approximate date.

Most of the time, the parties are able to close on the date in the contract, however you should not make plans to move or schedule moving trucks until you confirm the date with your lawyer.

Home Inspections: Inspections must be scheduled within 10 to 14 days after the attorney review.

When you schedule your inspection make sure your inspection company will perform a pest/termite inspection. You will most likely need a clear termite certificate for your lender prior to closing. It is also recommended that you have a radon test done during the inspection.

If your home inspection company finds evidence of an underground oil tank, active or abandoned, we recommend that you contact an environmental company to perform further tests. These tests will help to determine or to uncover possible leaking or contamination. If the house you are purchasing is serviced by oil heat, request from your realtor or the seller the name of the insurance carrier insuring the oil tank if it is located underground.

Remember the purpose of the home inspection is to uncover major or structural issues that affect the habitability of the home for you and your family. It is not a tool to renegotiate the price of the home. Cosmetic issues are usually not subject to repair requests. Contact us to discuss the legal issues revolving around the home inspection contingency clause in your contract.

Mortgage/Financing: Prior to going under contract, we would recommend that you research your mortgage options to determine the best programs and rates available for your individual purchase.

There are numerous issues that may come up with regard to your mortgage financing. You may hear people talking about sellers' concessions (financing your closing costs), interest-only arm programs, pay option arm programs, etc. These issues may get confusing, please contact us to help you navigate through these options.

It is very important that you get approval prior to searching for a home or prior to signing your contract. If you have a home to sell and you must sell your home in order to purchase your new home, it is imperative that you make that representation in your contract or have it added during attorney review. You want to avoid any situation where you may lose your deposit money because the correct language was not added to your contract. This is why it is very important that you retain an attorney to represent your interests in your home purchase.

Title Insurance: Title insurance is protection. Without a title insurance policy, you may not be fully protected against errors in public records.

Why The Buyer Needs Title Insurance
Hidden defects may not be disclosed by the public records, or there could be mistakes in examination of the title of your new property. As a result, you may be held fully accountable for any prior liens, judgments or claims brought against your new property. However, a title insurance policy ensures that if such an occasion arises, you will be defended free of charge against all covered claims and paid up to the amount of the policy to settle valid claims. With a title insurance policy you need not worry that your new property's history will tarnish your bright future.

Homeowner's Insurance

If you are purchasing a single or multifamily dwelling your mortgage company will require that you purchase homeowner's insurance usually one year paid upfront. We suggest that you obtain quotes right away. This will prevent against delays if your property is serviced by oil heat or if there are other issues that may make it difficult to obtain a policy. We also suggest that you investigate homeowners insurance prior to even purchasing a home or entering into a contract.

If you are buying a condo/townhome or co-op you will most likely not need homeowners' insurance, however, you may want to consider purchasing insurance for your personal contents.

Also, if the property you are purchasing is located in a flood zone (please speak with your realtor prior to entering into a contract to find out whether or not the property is located in a flood zone), you will most likely be required to purchase flood insurance, as well as homeowner's insurance. This can be costly and you should shop around.

The Closing: Your closing will most likely take place at the buyer's attorney's office. An attorney will accompany you at the closing.

Prior to closing, you should be familiar with:

  • Certified funds: A day or two prior to closing, we will contact you to provide you with your final numbers, so that you can secure final funds to bring to the closing table. It is important that you provide us with an email address or fax number so we can deliver you your final settlement sheet. Once you approve the final number you must get one (1) check payable to Weber, Fabiyan & Associates, LLC, attorney trust account (unless otherwise advised). This check must be certified or a bank check. Bring the check with you to the closing. If your check is not certified or a bank check you cannot close. There are no exceptions to this policy.
  • Walk through: Contact your realtor (or seller if there is no realtor) to schedule your final walk through. The purpose of this walk through is for the buyer to make sure all appliances are in working order, the water runs properly, the heat/air works, that the property is in the same condition as it was during the home inspections. Unless an item is hidden or considered a latent defect, the odds of recovering against a seller for a problem discovered after closing is minimal. Although expensive it may not be a bad idea to bring your home inspector to your final walk through to make sure there are no new problems, or issues not identified during the home inspections.
  • Closing: Make sure that you arrive a half hour prior to the time the sellers will attend the closing. This will give you time to go through your mortgage documents and get that portion of your closing complete. It will also provide you with an opportunity to correct any errors that may have been made relating to your mortgage or final numbers.

After The Closing: We will provide you with hard copies of your closing documents and a CD (PDF format) with all your signed documents.

We will also store your closing documents online indefinitely. We will record your mortgage and deed with the county clerk's office. When we receive the originals we will forward them to you immediately. We will also provide you with an original title insurance owner's policy. It is important that you keep this policy safe. You may need this policy when you go to sell your home.