Please find some common frequently asked questions below for Massachusetts Real Estate Closings. The below is organized into three sections: Buyer & Refinancing Borrowers, Buyers Only, and Sellers Only.
Wire fraud occurs in real estate closing transactions when an imposter pretends to be someone you know (typically your realtor, attorney, lender, or settlement agent) and sends you fraudulent wiring instructions. Often it will come from an email address very similar to that belonging to one of the aforementioned parties. Never send a wire without first calling the party to whom you are sending funds (using a phone number you know is valid) to verify the bank name, account number, and ABA routing number. Please click here for a better understanding of common wire fraud schemes.
We will contact you as soon as we receive the final amount of your closing costs from your lender. Your lender typically provides them to us twenty-four hours in advance of closing. Please do not coordinate obtaining a bank check or wire for any closing costs with your bank until you receive the final amount directly from our office. Any amount provided to you by your lender is only preliminary and will likely change.
Please note that if your transaction is a cash transaction, we will provide closing cost figures to you as soon as we receive everything we need to calculate them from the seller’s side. Typically, this is forty-eight hours in advance of closing.
Because we need funds that are immediately available in order to close, if the amount required to be brought to closing is over $2,000.00, you must wire the funds to our office. If the amount required is equal to or less than $2,000.00, either a wire transfer or a bank check payable directly to Silveri & Wilson, LLC is sufficient. We cannot accept personal checks and we cannot accept bank checks payable to another person/entity and endorsed over to our office.
We urge you to call your bank well in advance of closing to discuss its procedures for both wiring and obtaining a bank check. Although most banks allow same-day wire transfers and bank checks, some require at least three days to initiate a wire or to issue a bank check. If this is the case with your bank, please let us know at least one week before closing so we can work with your mortgage lender to provide you with an estimated closing cost figure. We will cut a check back to you at closing for any excess funds.
Please also find out if your bank has a limit on the amount of funds that you can wire. If your bank does have a limit, please let us know at least one week before closing so we can work with you to make sure you have a way to provide your funds in time for closing.
No, Electronic Fund Transfers (EFTs) are not wires and cannot be accepted for a Massachusetts Real Estate Closing. Any received EFTs must be returned, at your cost, and may delay closing.
You must be present at your real estate closing unless your transaction is a cash transaction or you have received approval from your lender to have someone else sign in your place under a power of attorney.
You will need to provide a valid driver’s license, US Passport, or state ID card for identification purposes at the time of closing. If your name does not match your ID, please call our office right away to discuss what will be needed.
When we obtain all the necessary documentation for closing and receive notice from your lender that your loan is clear to close, we will contact you to schedule a convenient time and place for your closing.
In light of the COVID-19 pandemic, please be aware of the following:
Making a large purchase or transferring funds between accounts can significantly impact your financing. Please be sure to speak with your loan officer before taking any such action.
You typically cannot move into your new home until all documents have been accepted for recording by the Registry of Deeds. Until this happens, your real estate closing is not complete and you may not be given access by the seller. The Registry of Deeds can take several hours to record documents and sometimes documents do not post until the following business day. Please keep this in mind when scheduling movers and contractors. They should be scheduled until later in the day. Access to the property and delivery of the keys must be coordinated with your realtor.
Lenders always require borrowers to purchase a Lender’s Policy of Title Insurance at closing. Because this policy only protects the lender’s interest in the property, it is strongly recommended that you purchase an optional Owner’s Title Insurance Policy to protect your own interests in the property on a purchase. The closing attorney coordinates obtaining that policy and the cost of the policy will be included in the closing costs received from your lender. Because the consequence of not obtaining an Owner’s Policy can be devastating, if you choose not to purchase one, you must sign a waiver at closing acknowledging the risks.
On a purchase, you will receive a mortgage commitment letter from your lender confirming they can finance you so long as certain conditions are met. It is imperative that you review any conditions in that letter with your lender before the expiration of the mortgage contingency date set forth in the Purchase & Sale Agreement. You must calendar this date and coordinate a termination or extension of this date. Once the mortgage contingency date (also referred to as the “commitment date” or “financing contingency”) expires, you can no longer terminate the transaction for a return of your deposits. If conditions are required on your commitment letter, they must be satisfied prior to closing and approved by your lender’s mortgage department. Your prompt attention to any such conditions is required under the Purchase & Sale Agreement that you signed.
If you have conditions that your lender cannot clear by the mortgage contingency date, you will need to discuss these conditions with your lender directly. This is to confirm that you are comfortable with the risk of them being unable to finance you. This could put you in default on the contract and result in you forfeiting your deposit. An extension of the mortgage contingency date might be required in order to protect your deposits or you may need to terminate the transaction. Requesting an extension could give the seller wiggle room to terminate the transaction. Only you can make this decision after speaking with your lender.
If you are purchasing property that presently has tenants, you must confirm for each unit whether the following have been paid: (1) last month’s rent; and (2) security deposits. You will need to obtain a copy of the lease(s) to confirm this information. Your real estate agent should be able to assist, if needed. Please email this information to us at least fourteen (14) days before closing so we can make appropriate adjustments and ensure that any deposits and rent previously paid are assigned over to you. You will also need to discuss with your lender whether any such adjustments can be included on the settlement statement.
Yes, Massachusetts requires that a licensed attorney conduct the closing and sign the paperwork with the buyer. Additionally, an attorney should work on your behalf to protect your interests by reviewing, negotiating and editing all applicable contracts, and to be there for questions along the way. You can learn more about what a Massachusetts Closings Attorney does by clicking here.
Many banks require the closing attorneys to be approved with them in advance. Our office is approved with hundreds of local and national banks and would be happy to speak with your mortgage lender to be added to their approved list. Frequently, attorneys act in a dual capacity and represent both the buyer and the bank in the transaction. This helps avoid duplicate fees and streamline communication.
Most offices that conduct closings are very close in price. What is most important is skill, experience, trust, communication, and the knowledge that the lower price isn’t being achieved by cutting corners. Errors in real estate can be costly, time-consuming, and difficult to resolve. What might seem like a slightly better deal now, could become an expensive proposition later.
Yes. One of the most important things to note has to do with real estate taxes. The property will likely be assessed by the town as vacant land or a single-family residence prior to closing (or in the case of condos, as a multi-family building). The assessor’s office will then reassess the property after closing which can take up to one year and sometimes longer. Once this happens, there will be a change in the assessed value of your property. This can result in an increase to the real estate taxes. While each town handles things differently, it is possible that you will receive a supplemental bill after the closing for the increase in these taxes.
A closing appointment for a purchase usually takes less than one hour to complete but depends on the lender and the amount of paperwork involved.
Massachusetts law requires that all closings be conducted by an attorney licensed in the Commonwealth. The closing attorney works with the buyer, oftentimes on behalf of the bank if they are getting a mortgage, and oversees the closing process. Their office is the one who reviews the title search to the property, facilitates the preparation of the closing documents, handles all funds, and physically signs with the parties on the day of closing.
Some of the major steps for someone selling their home in Massachusetts include:
These are just a handful of items that need to be coordinated prior to closing. A more detailed explanation of some of them can be found below.
When selling your home in Massachusetts, a Power of Attorney (“POA”) grants our office the authority to sign closing documents on your behalf. This is the customary and recommended procedure for people selling their home in Massachusetts. The power of attorney is limited and can only be used for signing closing paperwork.
No. Granting our office a Limited Power of Attorney to sign closing paperwork on your behalf eliminates the need for the seller to attend the closing. The closing is typically held at the Buyer’s Attorney’s office. This is especially helpful if you need to work, travel, or coordinate your move.
The attorney or title company working with the buyer’s lender generates a document called the Closing Disclosure, which will list all seller closing costs. This document is often not generated until one business day before closing.
If you have a mortgage on your property, our office will need to order a mortgage payoff statement from your lender confirming the required balance to pay off your mortgage. This amount will be deducted from your proceeds and paid off at closing by the buyer’s attorney. Many lenders require a signed authorization from the homeowner to generate the payoff statement.
If your mortgage is not to an institutional lender and is to a private party (e.g. a family member), you will need to help us coordinate with your lender in order to obtain a payoff statement and a mortgage discharge. The original discharge will be required at closing for all private mortgages.
Yes, we recommend paying your mortgage for the month of closing to avoid any potential late charges from your bank. When the mortgage is paid off, any excess the bank might receive is refunded to you typically within three weeks.
Yes, you will want to pay your HOA for the month of closing. The monthly homeowner’s association fees will be adjusted on the Closing Disclosure and you will receive a reimbursement from the buyer for the days of the month after closing.
Yes, you will need to provide a Certificate of Common Expenses from the HOA stating that there are no outstanding common charges due through the month of closing. If you are working with a real estate agent, they will likely coordinate obtaining this document on your behalf. If you live in a small condominium and there is no formal HOA, our office would draft the document in advance of closing and you would need to coordinate with the condo trustee(s) to have it notarized.
Real estate taxes are prorated on the Closing Disclosure based upon the closing date. Depending on the proximity of the closing date to the next due date for real estate taxes, you may be responsible for paying the next quarterly installment. Rest assured that you will receive a reimbursement back at closing for any amount of taxes paid towards the time period after the date of closing.
Massachusetts requires that septic systems be inspected and pass certain standards prior to the transfer of ownership of the home. You will hear this referred to as both the Title 5 and Title V septic system law. The inspection report is valid for two years so it can be done well in advance of closing. This period may be extended to three years if you pumped the system yearly and maintained those records. If you have any concerns about your septic system passing inspection, please speak with your real estate agent or our office as early in the transaction as possible.
Massachusetts law requires a Certificate of Compliance from the local fire department attesting to the working order of the smoke detector and carbon monoxide detector prior to the sale of a home. These certificates are typically good for sixty days and should be coordinated well in advance of closing. If the detectors do not pass, this permits time for a re-test. Be sure to have extra batteries on hand in case that is all that is needed to address the issue on the spot. You can find additional information on the requirements and appointment coordination on the state’s website here.
For a real estate closing in Massachusetts, final readings are utility readings from the municipality showing a final balance and often a final reading charge. They are required for all municipal utilities (i.e. utilities paid to the city or town). This bill is to be paid by the seller prior to or at closing (with a paid receipt if paid in advance). Typically, final readings are needed for municipal water, sewer, and electricity if your municipality has their own electric department. A list of Massachusetts municipality-owned electric departments can be found here.
If you are selling real estate out of a trust in Massachusetts, a Trustee Certificate will need to be drafted and signed for closing certifying that the Trust is still in good standing and that the Trustees have the authority to convey the property. We can prepare this document for you. If there is more than one Trustee, both typically need to be present to sign the documents unless your trust expressly provides otherwise. Massachusetts Closing attorneys will often require that the proceeds be payable to the name of the Trust directly, which could be problematic if your Trust does not have a bank account. Please let us know if you are selling a home that is in Trust and you do not have a bank account associated with the Trust. We can speak with the Closing Attorney prior to closing about this issue.
Rents, last month’s rent, and security deposits will all be adjusted on the Closing Disclosure at the time of closing. This information is not public record so you must inform us about the amounts no less than fourteen days prior to closing so we can communicate it to the Closing Attorney. Please note that last month’s rent and security deposits must be held in a separate bank account and cannot be commingled with your personal funds. The current month’s rent will be prorated for the month of closing and a credit will be given to the Buyer for any last month rent or security deposit paid upfront by a tenant
This is very common. If the buyer obtains a conventional mortgage, the bank will often send someone to appraise the property’s value. The Buyer may also have a property survey done, requiring a surveyor to take some measurements..