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All you Need to Know about Closing



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By : Vicki Hat    99 or more times read
Closing day is one of the most awaited days by the buyers. This is considered the last step before the buyer could move in and call it his or her own home. All parties involved in the home buying process (the seller, the buyer, the real estate lawyer, title company) will all be present to straighten out the transfer of ownership, secure the documents needed for the completion of sale and disbursement of fees due. This would not take much long. Actual hours could range between an hour and three.

There are parts of the closing process. The first part is the signing of documents. There are several documents that need to be presented during the meeting. The following are:

Truth in Lending Act
This is one of the documents required for the processing of mortgage. The loan could not push through without this declaration. In here you will find the final APR and the terms and condition of the loan.

Real Estate Settlement Procedure Act
This piece of document is just a declaration that you fully understand the process of home buying and all that is written in the documents signed.

Settlement Statement
It is commonly known as the HUD-1 form. All the closing fees and their respective amounts will be disclosed on this form.

Deed of Trust
This is a piece of document, which declares the house as the security of the loan. It will be recorded in the local county records to be in filed officially.

Mortgage Note
This document declares that the borrower promises to pay in accordance to the terms of the loan.

Proof of Insurance
The lender would require a homeowner's insurance to protect them or their investments, if something bad happens to the property. In some cases a private mortgage insurance is required if the down payment made is less then 20%.

Deed
The seller needs to bring the deed to the closing day. If all information is accurate and true, this will then be held by the closing agent and have it recorded in the county records after closing.

The Original Sales Contract
This should also be presented at the closing day. It can be used as a reference for the parties to validate if the sale had occurred in accordance to the terms and conditions stated on the contract.

Another part of the closing is the payment of fees. Here are the common closing fees that needs to be settled:

  1. Origination fees
  2. Discount points
  3. Appraisal fees
  4. Inspection fees
  5. Down payment
  6. Closing fee
  7. Title search
  8. Notarial and lawyer fees
  9. Fees for preparation of documents
  10. Recording Fees

All payments shall be made through check. The closing agent will collect them and disburse them to the right parties. As for the documents, they should all be checked for accuracy before the signatories could affix their signatures. After all of these things are accomplished, the keys to the house would then be handed over to the buyer. Then, he or she could do the move days later. The rest of the documents shall be submitted to the county records as an official record.
Find more real estate tips in Vermont Home Blog, AZ Metro Living and Southern California Community Guide.

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