A guide to closing documents you should keep after buying your home — and which you can get rid of.
Buying a home always requires gathering a variety of documents, from pay stubs to tax returns, and then signing even more as you process the mortgage and purchase. But once you’ve completed your transaction and moved in and established, do you know what you need to keep and how long you need to keep it for? Read on for tips.
Save … for a year
- Utility bills: At the end of the calendar year and once you have matched your actual expenses with what appears on your bank or credit card statements, you can get rid of your utility bills.
Save … indefinitely
- Home improvement purchases and receipts: You may not intend to sell your home soon, but keep proof of purchases and improvements you make, such as adding new appliances or drywall. They are useful in demonstrating appreciated value to future buyers.
- Insurance Policies: Keep these vital documents in a safe place so that you can have access to account numbers and coverage limits, as well as the agents you can contact, at any time.
- Mortgage documents : Keep any documents related to the mortgage that you obtain when you are buying your home. Even if you pay off your mortgage, you will receive a statement or certificate of settlement; save that too.
Save … until you sell your home
- Closing Documents: Retain a copy of any document signed during the closing of your home transactions as a backup. This may include the purchase agreement, addenda, disclosures and repair requests, security deposit information, inspection reports, and a closing balance statement. Some experts also recommend keeping this collection of forms for several years after you finally sell your home.
- Summary, title, appraisals and deed: Keep your own record, which describes such things as the legal limits and the history of your home.
Save … until expired
- Home warranties: Again, keep them in a protected place that you can remember to access coverage and limitations.
Other important considerations
- Where to keep important documents: Store them in a fire-resistant safe in your home or in a security deposit box.
- What to do with the documents you can throw away: Shred them; home office shredders are inexpensive and widely available.