When you are selling or buying a home you can almost always expect a mountain of paperwork to sign throughout the process and at the closing table.  And if you are like most, you don’t read every document before signing it.  However, there are a few documents you are going to sign throughout the process that you should definitely read fully and understand before signing.

1.  Purchase Agreement – This is your “contract” or “agreement of sale”.  This is definitely one of the most important documents in the transaction.  This spells out all the important details such as a financing contingency, inspection contingency, appraisal contingency, sales price, and also what each party, the buyers and the sellers, are paying in regards to closing cost.

2.  Title Commitment – The title commitment makes sure the property you are buying is free and clear of all liens and legal encumbrances. A title search is completed to prepare the commitment to insure. This will allow all parties to see what needs to be completed before you get to the closing table and clearly sets out any title issues.

3.  Promissory Note – It is just as is sounds.  It states that you promise to pay back the loan on your property or the bank is coming to get it. It details all of your loan terms, from the amount to the date to pay.

4.  Property Deed – This document lists on it the owner of the property whom is giving their interest to the new buyer or borrower, along with a legal description of the property.  The deed also gets recorded at the county courthouse to become public record to let everyone know who owns the property.

It is very important that you are aware of these documents and what they mean. Your realtor and your title company should be able to review these with you.

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