Congratulations, you’ve made it through all of the open houses, showings, competing offers, inspections, negotiations, and all of the other dreadful, nail-biting aspects of buying a new home, and now you’re finally ready to close and make your new property a home.
If everything goes according to plan, the real estate closing is simply a formality: everyone signs and initials their required paperwork and you hand over your hard earned and saved money in exchange for the keys to your brand new home.
It’s exhilarating, it’s nerve-wracking, and at times, it’s certainly an overwhelming process, but it doesn’t have to be. Knowing what to expect on your closing day will ensure everything goes effortlessly, which is why here at Close Happy® we’ve outlined everything you should know and do to be fully prepared for your real estate closing.
If you want to make your home closing process simpler, talk to your realtor or lender about using Close Happy® to streamline the real estate closing process and handle every aspect over our convenient app!
Review Documents Before Closing Day
By law, you are entitled in the majority of cases to receive your closing disclosure three days before your closing day. This massive document should completely detail both your closing costs as well as the seller’s closing costs. Review every page and carefully compare the costs on both sides prior to showing up for your closing or signing online if using an e-closing method like Close Happy®. If you need help understanding closing costs and which fees should be applicable to each party, here’s a quick synopsis.
Do One Final Walk-Through
As a homebuyer, you are also entitled to do a final walk-through of your new home purchase 24 hours prior to your real estate closing. What is the purpose of this final walk-through? You should ensure that the seller has fully vacated the property as well as that the home is in the same condition in which you agreed upon in your contract. For instance, if the seller promised to make some needed repairs following your home inspection, you should double-check to ensure these repairs and maintenance tasks were actually performed to your liking.
Who Will Be At The Closing?
Typically, your neutral, third-party closing agent — a title officer, escrow officer, or attorney — will run your closing meeting. Outside of the closing agent there will be you along with whomever else is signing your loan and title with you as well as your real estate agent.
What To Bring To Your Closing
Along with patience and your full focus, there are a few essential items to bring with you to your real estate closing. Click to view Close Happy’s entire buyer’s checklist for title closing.
What You’ll Sign At Your Closing
During your real estate closing, you’ll be closing on both your loan as well as your home purchase, so you can expect there to be a multitude of documents ready for your John Hancock. While these closing documents can vary based on your home and loan specifics, you can expect some relative combination of the following:
- Promissory note: This is your promise to pay back the loan amount and outlines your loan terms.
- Truth in lending statement: Also known as Regulation Z, this details your interest rate, annual percentage rate, and the total cost of your loan to ensure it is correct.
- Mortgage: When signing your mortgage, your lender puts a lien on your new home, and you have to put up your new home as collateral for the money you owe on it.
- Monthly payment letter: This breaks down how much you will be paying monthly for your mortgage including your principal, interest, taxes, and insurance.
- Closing Disclosure: This five-page form provides one final synopsis of all of the closing costs in which you will be expected to pay — some of it now and some of it in the future.
- Title: This is the official piece of paper that legally describes the property being purchased and officially transfers the ownership from the seller to you, the buyer.
- Proration papers: These explain the method in which you will be dividing up the costs with the seller of items such as property taxes, HOA dues, interests, utility bills and everything else for the month that you’re closing in.
- Statement of information: Also referred to as the statement of identity, this is used by your title company to properly verify that you are who you say you are.
- Declaration of reports: By signing this document, you are declaring that you have seen and signed off on the inspection reports done on the home you’re buying (it’s a good thing you went and did that final walk-through).
- Abstract of title: This is simply a list of all of the recorded documents that influence the title.
Take The Day Off For Your Closing
As you are already aware of by this point, real estate closing is a complex process, and because humans are humans, mistakes or complications can arise — slowing down the closing process. Something as minimal as a typo can hold up an entire real estate closing.
With that being said, it’s best to be prepared for these potential scenarios and take the entire day off of work to ensure you can get everything done. Try to schedule your closing for earlier in the day if possible. If it doesn’t end up taking a majority of the day, at least you have the keys to go enjoy your new home for the rest of the day!
Lastly, but extremely important, never wait to schedule your closing for the last day on your contract.
From all of us here at Close Happy®, we hope these helpful tips will ensure you are best prepared for your closing so you can have smooth sailing into your new home. If you’re interested in making your real estate closing even easier, get a free quote today for whatever title services or assistance you may need in the real estate closing process.