February 9th, 2018 7:08 AM by Jackie A. Graves, President
mortgage closing is the last step in buying a home: At the end of the closing,
the buyer becomes the legal owner of the home. This article will walk you
through the details of a mortgage closing so you’ll know exactly what to expect.
a mortgage closing, all legal documents — both those related to the mortgage
loan and those related to the transfer of the property from the seller to the
buyer — are signed. These documents may include your mortgage note, in which
you promise to repay your lender;
the home deed, which grants you ownership of the home; the Real Estate
Settlement Procedures Act paperwork, which states that you understand the
closing process and financial obligations related to your mortgage; the Truth
in Lending Disclosure Statement, which lays out the terms of the loan including
the annual percentage rate and information on points; and the HUD-1 Form, which
itemizes all the costs related to the sale of the home.
not just document signing. Money may also transfer hands: The buyer and
sometimes the seller may pay costs related to escrow or closing to the lender,
and the lender gives the closing agent money to cover the mortgage amount.
Other things that may occur: The buyer shows proof of homeowners insurance so
that the lender will fund the mortgage loan, and the closing agent sets up an
escrow account for the buyer, which will help the buyer pay taxes and insurance
on the property. Finally, the buyer will receive the title to the property; the
seller or a representative of the seller will give the buyer the keys to the
new place; and the closing company, attorney or title company officially
records certain documents such as the warranty deed.
attends a mortgage closing will vary depending on where you live, but in
general, these parties are likely to attend a closing: The buyer; the seller;
the escrow/closing agent; attorneys for both the buyer and the seller (the
attorney may be the closing agent); someone from the title company; the
mortgage lender; and real estate agents.
mortgage closing is the final step in the home-buying process before you
officially own the home. So before the closing, you’ll first need to find a home you like, make an offer, get
approved for the mortgage loan and have the seller accept your offer. Once all
that is finished, you will close on the home. The closing is completed once all
the documents are signed and the required monies have changed hands (see above).
one, the parties present at a closing for a refinancing are
different (and there are fewer of them) than those at a purchase closing: There
is no seller (it’s a refinance of your existing loan) or real estate agent
present, and sometimes it’s just the owner of the home and a representative for
at a closing for a refinance loan, you’ll get something called a rescission
period. This is a three-day window during which you can walk away from the
refinance loan without penalty. The lender must then refund the fees you paid
and give up its rights in your property. If you do not decide to rescind, your
lender will fund your new loan, and the closing agent will use the funds to pay
off your previous mortgage loan.
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