Did I mention you’ll receive a lot of documents to sign? A lot. Some of these documents are:
- The Closing Disclosure: You’ll receive the Closing Disclosure three days before your scheduled closing date. This document contains the final loan terms and closing cost details, and you should carefully review it to be sure the details are correct. It should look the same as the initial Loan Estimate you received from your lender.
- The Mortgage Note: This is your promise to repay the loan to your lender.
- The Mortgage or Deed of Trust: By signing this, you agree that your lender may foreclose on the home if you fail to repay.
- The Deed: This document transfers legal ownership of the property to you.
Proof of insurance
You’ll show proof of homeowners insurance and go over any applicable tax items. You need to prove you have insurance so the lender will actually fund the loan.
Transfer of funds
This is when you pay your down payment and any closing costs to the closing or settlement agent with a certified or cashier’s check.
Transfer of ownership
After you sign all the documents and pay your closing costs and down payment, the closing is finished. Your possession date (the day you can move into your new home) is stated in the purchase agreement. If your possession date is the same day as your closing, you’ll finally receive the keys to your new home!
And even if everything doesn’t go according to plan, don’t panic. At my first loan closing, the fax machine broke (along with my heart) and the loan officer couldn’t send our lender some final documents to approve. It was almost 5 p.m., and the lender’s office was about to close. I had just started frantically dialing my parents’ phone number to see if they would welcome houseguests when the machine whirred to life at the very last minute (4:57 p.m., to be exact). All I can say is, the universe (and apparently, its fax machine) works in mysterious ways.
If you’d like even more detailed information about what you can expect at your loan closing, check out the Consumer Financial Protection Board’s in-depth checklist or visit consumerfinance.gov.
