CLOSINGS
WHAT HAPPENS AFTER I HAVE APPLIED FOR A LOAN?
It usually takes a lender between 1-6 weeks to complete the evaluation of
your application. It's not unusual for the lender to ask for more information once the application has been submitted. The
sooner you can provide the information, the faster your application will be processed. Once all the information has been verified,
the lender will call you to let you know the outcome of your application. If the loan is approved, a closing date is set up
and the lender will review the closing process with you. And after closing, you'll be able to move into your new home.
WHAT SHOULD I LOOK OUT FOR DURING THE FINAL WALK-THROUGH?
This will likely be the first opportunity to examine the house without furniture,
giving you a clear view of everything. Check the walls and ceilings carefully, as well as any work the seller agreed to do
in response to the inspection. Any problems discovered previously that you find uncorrected should be brought up prior to
closing. It is the seller's responsibility to fix them.
WHAT MAKE UP CLOSING COSTS?
There may be closing costs customary or unique to a certain locality, but
closing costs are usually made up of the following:
Attorney's or escrow fees (yours and your lender's if applicable)
Property taxes (to cover tax period to date)
Interest (paid from date of closing to 30 days before first monthly payment)
Loan origination fee (covers lender's administrative costs)
Recording fees
Survey fee
First premium of mortgage insurance (if applicable)
Title insurance (yours and your lender's)
Loan discount points
First payment to escrow account for future real estate taxes and insurance
Paid receipt for homeowner's insurance policy (and fire and flood insurance
if applicable)
Any documentation preparation fees
WHAT CAN I EXPECT TO HAPPEN ON CLOSING DAY?
You'll present your paid homeowner's insurance policy or a binder and receipt
showing that the premium has been paid. The closing agent will then list the money you owe the seller (remainder of down payment,
prepaid taxes, etc.) and then the money the seller owes you (unpaid taxes and prepaid rent, if applicable). The seller will
provide proofs of any inspection, warranties, etc.
Once you're sure you understand all the documentation, you'll sign the mortgage,
agreeing that if you don't make payments the lender is entitled to sell your property and apply the sale price against the
amount you owe plus expenses. You'll also sign a mortgage note, promising to repay the loan. The seller will give you the
title to the house in the form of a signed deed.
You'll pay the lender's agent all closing costs and, in turn, he or she will
provide you with a settlement statement of all the items for which you have paid. The deed and mortgage will then be recorded
in the state Registry of Deeds, and you will be a homeowner.
WHAT DO I GET AT CLOSING?
Settlement Statement, HUD-1 Form (itemizes services provided and the fees
charged; it is filled out by the closing agent and must be given to you at or before closing)
Truth-in-Lending Statement
Mortgage Note
Mortgage or Deed of Trust
Binding Sales Contract (prepared by the seller; your lawyer should review
it)
Keys to your new home
