Congratulations! You are about to become a new home owner! All you have to do is get through the closing. The closing is almost to the finish line in the process of buying a home (the very last step is the deed being recorded). Closing is when all the paperwork is signed the deed is off to the city to be recorded and the house is officially yours.
The closing is typically 4-6 weeks from the time the offer was accepted (41 days is average). Your real estate agent should give you instructions as to what you will need specifically for your situation. This includes where to meet. Most likely the closing will be at the office of the title company, an attorney or the lender. Expect the closing to last an hour.
Before they hand you the keys there is a lot of paperwork to sign, which may include:
• The mortgage: This includes paperwork that is specific to your lender.
• The promissory note (which spells out how you will pay the lender)
• The title of the home/property deed will be signed over to you. Or in the case of newly constructed homes, you will be given a certificate of occupancy.
• A closing disclosure (an itemized list of final charges). You should get a copy of this a few days before the actual closing date.
Don’t sign anything until you have reviewed the documents and understand what you are signing. If something is different from what you expected then ask! Once you sign it you are responsible for the terms.
Be prepared to bring some things too including:
• A certified or cashier’s check to cover the down payment, closing costs, prepaid interest, taxes or insurance. You can also send these in advance through a wire transfer.
• Photo ID
CLOSING NOTE: On average, you’ll pay 1-2% of the purchase price of your home in closing fees. You can estimate your closing costs with an online calculator.
Here’s one from Bank of America.
You won’t be the only one there… Real estate agents from both parties, buyer/seller’s attorney(if they have one), lender’s representative and the closing agent will be there. Don’t get nervous about all the suits in the room. You’ve read this blog so you already know what to expect.
You will leave with a copy of the operable documents that you have signed. There are documents required by the Fed of the lending institutions that you will not need or leave with. Any hard copies relative to your closing and home purchase should be kept in a safe place and at the ready.
Especially the first months of homeownership you will have questions and may be asked questions by your insurance company or lender that you will need your closing paperwork to answer.
After that, all that’s left to do is pop some champagne, move in and meet the new neighbors!