Home Buying in Reston>Question Details

Lucky One, Home Buyer in Reston, VA

why I have to bring cashier check to the settlement plus personnel check?

Asked by Lucky One, Reston, VA Thu Jul 12, 2012

I have good faith estimate from the lender but I did not get HUD1 from the title company. They have my earnest money and they are asking to bring cashier check plus personnel check. Is this right? I though the law change and you won't be no surprises any more. am I wrong? or this is the time where everybody want to take as much money as they can when you are closing on home. How can I avoid having hit with big amount at the closing table. Please Advice me because my closing date is so soon and I am very nervous.

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Lucky One,
Looks like you are dizzy from all of this information and I understand how you feel!
Let me explain a little bit:
You will get a detail explanation of the HUD-1 with a line-by-line from the title company. Also, you should have received a initial good faith estimate from your lender which can not be more than 10% of the final HUD-1. For most of the title companies if the difference is over $1,000 they will ask for cashier's check. Furthermore, if there are any additional changes during the settlement and it affects the final HUD-1 the title company will cut a check and give you the difference. However, that is only if you have credit, if it is the other way around you can give a personal check.
Best all luck and Congratulation!
Web Reference: http://www.oscarbusch.com
0 votes Thank Flag Link Fri Jul 13, 2012
Total fees that were charged by the lender and title company on HUD-1 cannot exceed 10% of the original amount. There should be no surprises there.
There are might be additional fees for services that were ordered by you, if not paid prior to the settlement.
Your buyer agent - if you are working with one - should be able to answer all these questions for you.

Good Luck
0 votes Thank Flag Link Thu Jul 12, 2012
Why don't you ask your Buyer agent this question?
Why don't you ask your settlement agent that you have the right to choose about the preliminary HUD-1?
0 votes Thank Flag Link Thu Jul 12, 2012
Typically anything over a $1000 requires a cashier's check. Title companies ask that you bring a personal checkbook just in case there is a balance over what the cashier's check is for. This is just a standard precaution and you should have a HUD-1 the day before closing so you know exactly what you need to bring to closing.

Plus the fees on your final HUD can't exceed what you were quoted on your initial Good Faith Estimate by a more than a certain percentage so no need to worry. You may be off a few dollars here and there and that is usually due to a variance in daily interest, final homeowner's insurance premium, title/recording fees, etc.
0 votes Thank Flag Link Thu Jul 12, 2012
The Cashiers check is made out in the amount shown on the HUD-1 that you have reviewed prior to settlement. There are sometimes valid adjustments made at settlement. For instance, what if you decided to change the type and amount of title insurance at the table? Maybe the pest inspection costs did not show up on the copy you reviewed prior to settlement, but the invoice is received the morning of your closing? These are valid costs you agreed to pay, so the closing company is going to want to collect from you.

I have rarely seen these checks used, recently, but the idea is to keep settlement from being held up over a minor amount of money.

A good Realtor will review the HUD-1 for you prior to settlement and minimize these adjustments and overlooked charges.
0 votes Thank Flag Link Thu Jul 12, 2012
BTW, if you have not received a HUD-1, you need to ask for it so that you have time to review prior to settlement.
Flag Thu Jul 12, 2012
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