What happens after closing?
Congratulations on realizing your dream of homeownership! Life as a homeowner can be very rewarding and a little overwhelming. The following information includes practical advice to help you make the transition to homeowner.
Making the move
- Start packing! Staying organized will make your move much easier. If you do your own packing, it is a good idea to use boxes that can be easily carried. Label them with the contents and where they go in your new home. Pack a lot of filler in boxes to protect fragile items.
- Contact the local utility companies to hook up electricity, gas, and water to your new home.
- Contact the phone company to hook up phone service lines and to receive your new phone number.
- Notify the cable television company or satellite provider. While some providers may need as little notice as a day to activate your services, it's best to give them a few weeks.
- Touch up paint or repaint before you move your furniture in.
- Measure the door frames to be certain that larger pieces of furniture will fit.
- Notify the post office of your address change and request that your mail be forwarded.
- Notify your creditors, business associates, friends, employer, and child's school or caregiver of your new address and phone number.
- Update your bank checks with your new address.
- Update the address on your driver’s license within 30 days of moving.
- Change the locks on the doors of your new home.
Meeting your new financial obligations
You should have received a payment coupon for your first house payment at closing. Do not be surprised if you receive a letter from the lender telling you that the loan has been sold. This is a very common practice. The lender will tell you where to mail your payments if your loan was sold, and you should receive a coupon booklet in the mail from the new lender, which is now your loan servicer. Even if you don't receive a payment coupon, you need to make your payments on time. Contact the loan servicer for payment information.
The loan servicer will keep track of your payment history. The servicer applies your monthly loan payment to the loan balance and escrow reserves. The loan servicer is responsible for paying your real estate taxes and hazard insurance from the escrow reserves. While the tax and insurance bills should go directly to the loan servicer, they may come to you. If so, just forward them to the servicer for payment.
Your payment may increase in the future if a higher escrow balance is needed to meet rising real estate tax or insurance costs. The loan servicer will provide a year-end interest statement and account analysis so that you can monitor this. You will also need this information when you file your taxes to ensure you take the appropriate deductions for the interest and real estate taxes you have paid. Consult your tax adviser with any questions.
Another aspect to your new financial responsibilities is maintaining good credit. Your credit affects your future borrowing ability if you decide to obtain a home equity loan, or if you decide to sell and buy a new home. One of the most important credit decisions you can make is to pay your mortgage on time. Never let other debts take precedence over your home loan. The effect on your credit can be irreparable if you don't pay your mortgage. If you fall behind on your payments, the lender has the legal right to foreclose on the loan, meaning that you will be forced to move out and the property will be sold.
If you do fall behind in your payments or suffer a financial hardship beyond your control, notify your loan servicer immediately. Always stay in touch and try to make arrangements for repayment. In addition, if you are having trouble making your mortgage payments due to a job loss and received a Montana Housing low-interest mortgage loan, we may be able to help you. In addition, the U.S. Department of Housing and Urban Development provides guidance on avoiding foreclosure.