Buying a house is an exciting chapter in your life, especially if you are a first-time homeowner!
Purchasing a home is a lengthy process with many components and as a first-time homebuyer, you may be overwhelmed by all the information and homebuying steps which is why we created our Mortgage Madness series.
The fourth and final installment in our Mortgage Madness series covers what to expect in the closing process so you can be prepared when that time comes.
Closing on a house is the final step of the lengthy homebuying process and for homebuyers, this is the day that they take over ownership of the house, finish paying closing costs and escrow items, and receive the keys.
On average, closing on a home can take 30-45 days from completing the mortgage application to sitting at the closing table. On the day of, filling out the proper documentation can take anywhere from 1-3 hours (possibly more) depending on how prepared you are.
Understanding your closing documents is the first step in preparing for closing day.
Closing Documents for Buyers:
- Closing Disclosure
- Available at least 3 days before closing day, the closing disclosure outlines the details of your mortgage.
- Loan Estimate
- The loan estimate document includes information about your loan such as loan terms, interest rate and closing costs.
- Mortgage Note
- The mortgage note simply states your promise to repay the mortgage. The mortgage note will include details such as the terms of the loan, the amount you will pay, and what the lender can do if you do not make payments.
- Escrow Account Statements
- This document outlines payments your lender will pay from your escrow account within the first year of your mortgage. These payments include taxes and insurance.
- Deed
- The deed transfers ownership from the seller to the buyer.
- Title
- The title shows ownership of the property that provides the owner with the right to do whatever they wish to the property they own.
Now that you have a better understanding of the documents provided at the closing, you should also know the items you need to bring day of.
Items to Bring to a House Closing:
- Necessary Paperwork
- Many of the documents you need to sign at the closing will be provided to you but there are some documents you need to bring with you. These documents include proof of homeowner’s insurance, and proper forms of identification.
- Proof of Homeowners Insurance
- Most lenders require an insurance policy before closing. Bring proof of insurance to the closing.
- Cashier’s or Certified Check or Proof of Wire Transfer
- Closing costs can include a number of fees such as property taxes, HOA fees, and utility bills. At the closing, homebuyers are required to pay all the closing costs via a cashier’s or certified check or a wire transfer of funds to the financial institution.
- Proper ID
- Proper forms of Identification include a Driver’s License, a passport, and a government ID. If you are married and buying the house with your spouse but do not share a last name, make sure to bring your marriage certificate.
The closing process can cause some anxiety, and that is why you should work with a reputable realtor and financing company for your mortgage. A good loan officer will make sure you have all the necessary information for a successful closing.
This concludes our Mortgage Madness series; we hope this information provides you with a better understanding of the home-buying process and helps alleviate some of the stress so that you can spend more time enjoying the excitement.
Looking for more information and to get your questions answered by experts? Attend our First Time Homebuyer Webinar on April 4th, 2023. This webinar is available to all in our community. Register today!
