What Happens at the Real Estate Closing?

The closing will take place at the office of an attorney of your choice who will act as our agent, the seller may also be at the closing to transfer ownership to you.

During the closing you will be reviewing and signing several loan papers. The closing attorney conducting the closing should be able to answer any questions you have or you can feel free to contact your Mortgage Loan Advisor if you prefer.

Just to make sure there are no surprises at closing, your Mortgage Loan Advisor will contact you about three days before closing to review your final fees, loan amount, first payment date, etc. This is called the final closing disclosure at which point you are ask if everything is what you were told, and agreed upon. if so you will be asked to sign it. Federal Law requires that you have three days to decide positively that you want a new mortgage after you sign the documents. This means that the loan funds can not be disbursed until three business days have passed. The closing will occur after the three days have passed.

The most important documents you will be signing at the closing include:

HUD-1/Settlement Statement/Final Closing Disclosure

This document provides an itemized listing of the final fees charged in connection with your loan. If your loan is a purchase, the settlement statement will also include a listing of any fees related to the transaction between you and the seller. If this loan will be a refinance, the settlement statement will show the pay off amounts of any mortgages that will be paid in full with your new loan. Most items on the statement are numbered according to a standardized system used by all lenders. These numbers will correspond to the numbers listed on the Closing Disclosure you signed earlier and previously provided in your application package. This document is also commonly known as the settlement statement and both the buyer and seller must sign this document.

This document provides full written disclosure of the terms and conditions of a mortgage, including the annual percentage rate (APR) and other fees. It is exactly the same as the TIL that you received immediately after your initial application, except it has been updated to reflect the final rate and fee information. Federal law requires that all lenders provide you with this document at closing.

Note

This is the document you sign to agree to repay your mortgage. The note will provide you with all of the details of your loan including the interest rate and length of time to repay the loan. It also explains the penalties that you may incur if you fall behind in making your payments.

Mortgage / Deed of Trust

This document pledges a property to the lender as security for repayment of a debt. Essentially this means that you will give your property up to the lender in the event that you cannot make the mortgage payments. The Mortgage restates the basic information contained in the note, as well as details the responsibilities of the borrower. In some states, the document is called a Deed of Trust instead of a Mortgage.