Property Appraisal, Inspections, & Escrow - After an offer is presented, there are additional steps in the home buying process that need to be addressed; the most common of which are: property appraisals to determine value for lenders, land surveys to determine boundaries, title reviews, pest inspections, and structural inspections.

In addition to appraisals and inspections, insurance plays a vital role in any real estate purchase, with the essential goal being to protect property owners in the event of catastrophe. In addition, most lenders will not provide funding without basic homeowners insurance.

Property Appraisal - Lenders require appraisals to confirm that the home for which they're providing you a loan is in fact worth the amount you're paying. Appraisers are independent agents normally hired by the lender, however you may have a choice. The fees appraisers charge vary and are typically built into your loan costs.

Your lender may also require a Location Survey that certifies the house is within the boundaries of the lot. The lender often selects the surveyor, but again, you may have a choice. The lender usually pays for the cost of an appraisal. Then it's factored into the buyer's closing cost.

Property inspections - Structural inspections are particularly important. During these examinations, an inspector comes to the property to determine if there are any physical defects and whether expensive repairs and replacements might be required in the next few years.

Such inspections for a single-family home often require two or three hours, and buyers should attend. This is an opportunity to examine the property's mechanics and structure, ask questions and learn far more about the property than is possible with an informal walk-through. Additional inspections may include:

Escrow - Closing a real estate deal brings together a variety of parties who are part of the "transaction" process. The history of a properties ownership has to be checked, it's possible that the records contain errors, unrecorded claims or flaws in the review itself, making title insurance a necessity.

At closing, transfer taxes must be paid and other claims must be settled (including closing costs, legal fees and adjustments). In most transactions, the closing agent also completes the paperwork needed to record the loan. Eventually, the title to the property is transferred from seller to buyer. The buyer receives the keys and the seller receives payment for the home.

From the amount credited to the seller, the closing agent subtracts money to pay off the existing mortgage and other transaction costs. Deeds, loan papers, and other documents are prepared, signed and filed with local property record offices. Before closing, buyers typically have a final opportunity to walk through the property to assure that its condition has not materially changed since the sale agreement was signed.

At closing itself, all papers have been prepared by closing agents, title companies, lenders and lawyers. This paperwork reflects the sale agreement and allows all parties to the transaction to verify their interests. For instance, buyers get the title to the property, lenders have their loans recorded in the public records and state governments collect their transfer taxes.