You've made it to final approval with clear to close and now it is time to finalize everything at a closing appointment. In this final lesson of the guide to a Home Purchase, you will learn more about the closing process.
With your closing appointment near, this guide will help you prepare for the appointment including what to expect during the appointment.
What's the entire purchase process look like? You are currently on the tutorial that teaches you what it is like after you've completed a majority of the loan process including reaching final approval and now on the final step, closing the loan. If you'd like to learn more about the entire process, please visit my home purchase process guide.
Understanding Your Documents
Be sure to request a copy of your final Closing Disclosure (CD). This document which will be signed at the title office amongst many other documents includes the details of your loan including:
- Loan program.
- Loan term (years).
- Interest rate.
- Mortgage payment.
- Closing costs (loan, appraisal, title and government fees).
- Prepaids including interest in advance.
- Funds needed to close the loan.
- ... and much more.
Carefully review your CD and compare it to your Loan Estimate at the beginning of the loan. If you find discrepancies or errors, let your Loan Officer know immediately so these items can be reviewed.
If your acknowledged CD was an initial CD that has been revised, be sure to request and review your final CD to make sure everything is as agreed.
If you have any questions regarding your CD and I am your Loan Officer, give me a call and I'll happily answer any questions or concerns.
Cash to Close
Earlier in the loan process, you reached Final Approval which included a final review of your documentation including bank statements which shows available funds.
If you have an amount showing on your CD as cash to close, you will be expected to provide those funds before or immediately after signing your closing documents.
Most title companies will want any amount over $1,000 to be wired directly from your bank. Some title companies will allow a personal check or bank-certified cashier's check for amounts under $1,000. If you'd like to know your options, call your title / escrow officer and ask, they will be happy to answer any questions.
You may send multiple transfers from multiple accounts to title as long as the total amount equals (or exceeds) the amount showing on your CD. Any excess funds will be given back to you from title after your transaction is complete.
The term "Cash to Close" does not mean cash. This term refers to the funds you will need to finalize your real estate purchase.
What You Need to Bring to Closing
All borrowers on the loan will need to sign the loan documents. Please be sure all borrowers on your loan bring their driver's license, government-issued identification card or a US passport.
Funds to close may be sent prior to your appointment via wire but when doing this, be sure to call your escrow officer directly to verify the wiring instructions you have are correct. If this is not done, title will provide you a copy of their wiring instructions at your closing appointment which can be completed after signing all of your documentation.
If title has allowed you to pay with a bank-certified check, please bring this check to closing.
What to Expect at Closing
If I am your Loan Officer, I will make every attempt to attend your closing so I can answer any questions or concerns during the signing process. Many of my real estate partners also make every attempt to attend your closing to celebrate the occasion.
There is going to be a large stack of paperwork that you will need to sign and date. The stack looks intimidating, however, there's many multi-page packets where you will sign only the last page.
Your escrow officer will go over each document with you to help you comprehend what you are signing. You are encouraged to read and comprehend each document before signing.
After you've completed all of the documentation, your title / escrow officer will likely ask how you'd like to receive a copy of your signed documentation. You may request a physical copy and/or a digital copy delivered electronically.
Settlement / Home Possession
Contrary to popular belief, completion of your loan documentation doesn't grant you possession of your home with keys.
After your documents are signed with receipt of funds required to close, the title office will then begin the post-closing process of finalizing your home purchase. Some of the process includes:
- Scanning and verifying all signed documents.
- Send the full packet of documentation to the lender.
- Await the lender to verify documentation.
- Receive and answer to "Prior to Funding" conditions from the lender.
- Receive authorization and officially request funding from the lender.
- The deed and mortgage are submitted to the Register of Deeds office.
- Receive acknowledgement that the deed has been recorded.
- Announce to all parties that the property is recorded.
- Distribute funds to the seller including clearing / paying off liens (if any).
Once your property is recorded, you may now take possession of the property including transfer of all keys, alarm codes, door panel codes, garage door openers and other methods to access the property.
You've reached the end of this Complete Beginner's Guide to a Home Purchase. This guide is constantly evolving and improving. If there are any unanswered questions or concerns, please feel free to reach out to me and ask!
If you've been following along on a real home purchase, congratulations on your new home! It's such an exciting time and I hope you enjoy the whole experience of being a homeowner!