What happens after closing

You’ve signed your paperwork. Your keys are in hand. It’s time to move in and take ownership of your new home. But what exactly happens next?

It’s normal to feel unsure about what to do after buying a house and the immediate steps involved thereafter. When is the first mortgage due after closing? What should I account for when creating a budget for my new home? What kinds of paperwork and homeownership tasks are involved? How and when should I change locks, set up utilities, and update address information? Read on for answers to these and other important questions.

Financial planning and budgeting

There are several significant money matters to address following your closing. Let’s break these to-dos down into the three most important categories.

Make your first mortgage payment

Your first mortgage payment is typically due about one full month after closing – most often on the first day of the following month. For example, if you close in June, expect your first payment to be due on August 1. Note that you prepay the interest between your closing date and your first payment date , so the initial due date could be up to 60 days after closing. Review your closing documents and welcome letter to learn your exact due date and grace period.

“You can usually pay online, by mail, or by using your lender’s mobile app or website,” says Martin Boonzaayer, CEO of The Trusted Home Buyer in Arizona. “I always recommend setting up automatic payments, also called autopay, so that you never miss a payment. And, if possible, consider switching to biweekly payments, which is a great way to shave years off your mortgage and save on interest.”

Biweekly payments split your payment in half, with one due date in the first 14 days of the month. Payments are made every 2 weeks, making budgets more manageable. Because there are 52 weeks in a year, you have the option of making an extra half payment applied to principal when a third payment falls in the month, saving interest.

Create your new budget

It’s smart to crunch the numbers and devise a budget plan for your new home that takes into account all the regular expenses involved, including:

• Mortgage payments
• Monthly utility bills
• Property taxes
• Homeowners insurance premiums
• Home maintenance and repair costs
• HOA fees (if applicable)

“Planning ahead for these recurring costs can help you avoid surprises and ensure stability throughout the year,” says Amanda Graham, a Virginia-based real estate advisor with TTR Sotheby’s International Realty.

Many of these costs, particularly property taxes and HOA fees, can be rolled into your mortgage and managed with an escrow account, although they should still be accounted for in your budget. Escrow accounts established at closing allow spreading the cost of your real estate taxes and homeowners insurance premiums throughout the year rather than making one large payment. If there’s mortgage insurance tied to your loan, it’s also paid out of your escrow account.

“Budgeting wisely is also invaluable during tax season, when tracking property-related expenses and deductions like the mortgage interest deduction can meaningfully affect your tax return,” adds Graham.

Save for emergency repairs and upgrades

It’s only a matter of time until your home will require upkeep or fixes. These necessary expenses can be costlier than you think. That’s why it’s recommended to set aside dollars in an emergency fund.

“When buyers first purchase a home, they don’t usually have any equity built up in their investment that they can use to qualify for a home equity line of credit or home equity loan to cover the cost of needed repairs. Hence, it’s a wise choice to start saving that money ahead of time rather than being caught having to use a credit card to finance repair purchases,” Liz Walker, a Wisconsin REALTOR® with RE/MAX RealPros, says.

Ryann Brier, a real estate agent with United Realty Services in Michigan, recommends setting aside at least 3 – 6 months’ worth of expenses, or 1% to 3% of your home’s value annually, for upgrade and repair costs.

“Most homes, especially older ones, require seasonal upkeep like servicing the furnace or addressing roof wear,” she says.

It’s a good idea to create a checklist or schedule for recurrent seasonal tasks. But it’s also smart to stash away extra funds for emergencies, particularly if you live in an area of the country prone to natural disasters like hurricanes, earthquakes, tornadoes, or major storms.

Paperwork and administrative tasks

It’s equally important to keep good records and ensure that major documents and paperwork are in order, properly filed, and protected. Here’s a breakdown of the essential items and tasks involved.

Organize key documents

There are certain documents and papers that you should store carefully and know how to access quickly. These include your:

• Property deed: Proof that you legally own the home
• Title : Confirms ownership and any liens or claims
• Closing Disclosure : Final summary of your loan terms and closing costs
• Mortgage note and mortgage/deed of trust: Your loan agreement and collateral document
• Title insurance policy: Protects against title or ownership disputes
• Homeowners insurance policy: Coverage for property damage and liability
• Receipts for upgrades, repairs, and replacements: Especially for major systems or appliances; helpful for resale or insurance claims
• Property tax bills and payment records : Proof of taxes paid each year
• Home inspection reports: A record of the property’s condition before purchase
• Home warranty (if applicable): Covers certain repairs or replacements after closing

It’s important to keep both physical and, if possible, digital copies of these documents. Consider storing physical copies in a fire-resistant safe and digital copies and a password-protected/encrypted app or folder.

“It’s a wise choice to place all the paper documents you receive at closing within a binder for future reference,” Walker says. “For instance, having your insurance policy in the binder makes it the go-to reference in case you need to file a claim. I also suggest sticking any future repair receipts and appliance purchases in that binder as well. That way, when you sell your home down the line, you have the date the repair was made, or you can easily access serial and model numbers for future repairs.”

Brier says she prefers to store her digital documents in a dedicated online folder like Google Drive or Dropbox.

Verify that your deed is recorded properly

Your property deed is a written document, typically drawn up by a real estate attorney, that moves property ownership from the seller to you, the buyer. House deeds are important because they show who has a legal ownership interest in a property. That’s why it’s vital to make sure your deed is recorded properly.

“After closing, double-check that your deed has been recorded with your local county or city recorder’s office. This confirms that the property is legally in your name,” says Boonzaayer. “You can usually verify this online or by calling the recorder’s office to confirm your document is on file. It’s a simple but important step that protects your ownership rights.”

Update your address

You want to ensure that bills, statements, and other important mail get delivered punctually to your new address so that you can avoid missed payments, late fees, and lost mail.

“Updating your address should guarantee the continuity of important correspondence and billing. It will also help safeguard your personal information and maintain accuracy in official records tied to your new property,” Graham says.

Inform the following of your new address as soon as possible – ideally immediately after closing:

• USPS
• DMV
• Secretary of State’s office
• Banks, credit cards, and other financial institutions
• Lenders and loan servicers
• Employers
• Utility companies
• Subscriptions
• Insurance companies

Review your insurance and warranties

If you are financing your home with a mortgage loan, your lender will require you to have homeowners insurance in place and request proof of an active policy, likely a few days before closing. You should carefully review this policy and your coverage limits so that you are properly safeguarded from losses and liabilities.

“Confirm the coverage limits for things like cost replacement – not just market value. Depending on where you live, you may also want to review for additional coverage like flood or sewer insurance, which are common concerns for a lot of homeowners,” says Brier.

Homeowners coverage should evolve with your home as you continue to live in it. Take the time to regularly review your policy to make sure the coverage matches your property’s current value and also accounts for any updates or special circumstances – such as renovations or valuable collections. It’s a good idea to shop around and get fresh price quotes on homeowners insurance to prevent being overcharged.

If you are required to pay mortgage insurance on your loan, carefully review that policy so that you understand if and when it can be canceled.

Additionally, if you have a home warranty , give careful thought to its cost and value to you.

“Home warranties are worth reassessing annually if you live in an older home,” adds Brier.

Home safety and security

In addition, you should check that your home is properly secured with recommended security and safety systems and devices. Let’s cover the essentials one by one.

Evaluate alarm systems, detectors, and extinguishers

Take the time to check, repair, or newly install the following:

• Carbon monoxide detectors: Test monthly by pressing the “test” button and replace batteries every 6 months. Install one on each level and near sleeping areas. Replace the unit every 5 to 7 years or at the manufacturer’s recommended intervals.
• Smoke detectors: Test monthly and replace batteries twice a year. Vacuum occasionally to remove dust, and replace the entire unit every 10 years or at manufacturer-recommended intervals. Place one in each bedroom and hallway.
• Security systems: Test alarms and sensors monthly to be sure they trigger properly. Update passwords regularly and replace sensor batteries annually.
• Fire extinguishers: Check monthly to ensure the pressure gauge is in the green zone. Shake a few times a year to prevent clumping, and replace or service every 5 to 12 years, depending on type.

“Make sure on closing day that the seller has disabled any smart features and explain to you how to access them. Same goes for security cameras,” Walker suggests.

Locate valves and breakers

It’s important to know where water shut-off valves and circuit breakers are located. This is essential in case of a burst pipe, broken water fixture, or electrical concern. Label your water shut-off valve as well as what each of your circuit breakers controls in your home.

Childproofing and first aid kits

If you are moving in with younger kids or expect to raise a family, you’ll want to carefully childproof your home and have emergency supplies on hand. Experts recommend covering electrical outlets, securing sharp corners, using locks on cabinets containing chemicals, cleaning supplies, and medicines, anchoring TVs and heavy furniture to prevent tipping, and setting up safety gates on stairs.

Your emergency supplies should include a first aid kit, fire extinguisher, flashlights with spare batteries, nonperishable edibles and bottled water, and important medications. This way, you’ll be ready for unanticipated emergencies as well as minor accidents. For other safety items and tips to consider, consult with your County Board of Health and local municipality.

Create a disaster plan

You and your family need a strategy for what to do in case of an emergency or disaster. Create a disaster plan that covers how to escape different areas of your home in the event of fire, home invasion, or other emergency, and where and when to meet up outside your home. Also, review where and how to shelter in place in the event of a tornado, major storm, or other disaster. Practice safety and sheltering/evacuation drills with your family occasionally.

Additionally, ponder investing in additional insurance coverage, such as a separate flood insurance policy and/or earthquake insurance , if you live in an area prone to these disasters.

The bottom line: Preparedness is key after closing

Closing on your loan is an important milestone, but it’s just the beginning of your homeownership journey. Life takes plenty of twists and turns. So you should create a realistic budget plan, carefully manage paperwork and documents, and check that your property is safe and secure.

If you have a Visto Mortgage loan, you can trust in our experts to help ensure a smooth transition after closing and guide you through our available resources, such as our Client Portal, where you can set up automatic payments. Contact a Home Loan Expert with any requests or questions you may have.

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Erik J. Martin is a Chicagoland-based freelance writer whose articles have been published by US News & World Report, Bankrate, Forbes Advisor, The Motley Fool, AARP The Magazine, USAA, Chicago Tribune, Reader’s Digest, and other publications. He writes regularly about personal finance, loans, insurance, home improvement, technology, health care, and entertainment for a variety of clients. His career as a professional writer, editor and blogger spans over 32 years, during which time he’s crafted thousands of stories. Erik also hosts a podcast (Cineversary.com) and publishes several blogs, including martinspiration.com and cineversegroup.com.

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