Congratulations on selling your house… you even made a little money out of the transaction.  There are still a few things to do other than cashing your proceeds to make sure there are no surprises while you are on your tropical vacation.  These tips may save you some time and money down the road.

1. If you have a mortgage, call your mortgage company 3-5 business days after closing to verify their lender received the payoff from the settlement agent.  If the answer from their lender is no, then contact the settlement agent ASAP so the payoff can be tracked.  A settlement agent should be able to track the funds whether the payoff was sent by a wire or overnight carrier.  It is a lot easier to fix a payoff the first week after closing than after you receive a notice from your lender saying you’re late on your payment… and have it reported to a credit agency.  If you do your banking on line, remember some lenders may close out your account upon receipt of the payoff so you may have to dig out a statement and call customer service.  And if you have your payment set up on an autodraft, make sure to stop further payments.  

2. If you have an escrow account for taxes and homeowners insurance, check with your lender to:  

  • see how much money is in the account as well as verify if there is any overage on your payoff that should come back to you
  • see how long it will take to get your money back
  • make sure your lender has the correct address to send your check.   

Remember, this is your money being held in an account for you.  Mark the date you’re supposed to receive your funds, and if the day comes and goes, contact your lender to see if your check has gone out. If it has, let your lender know you did not receive it so measures can be taken to stop payment on the check and to reissue another check.

3. Last but not least, do not cancel your homeowners insurance until you have receipt of your proceeds.  Under the Good Funds Settlement Act, a settlement agent may not disburse until the deed transferring the property is on record.  You’re still liable for damage to the house until closing which is defined as recording the deed.  While cancelling your homeowner’s policy, ask about getting any pro-rated refund on your premium and give your insurance company an address they can forward any refund.

These simple checks and balances can give you peace of mind, makes sure you put a little more money in your pocket, and keep a minor mistake or oversight from becoming a major problem.

Published by Christopher T. Salyer on April 12, 2016