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What to expect at closing

By | Published: Oct 14, 2009 | 110 Comments

You've survived house hunting and the bidding and negotiating on your new home, and now it's time to make it yours. But to do so, you have to sit down with various people, which may include the seller, your real estate agent, title and mortgage company officials and possibly your attorney at what's known in real estate lingo as the "closing table."

At closing, you will close on the purchase of your new home, and if you are taking out a mortgage, on your home loan, as well. The whole process may take about an hour. Here's what's expected of you:

  • Complete the walkthrough

    Before the actual closing, you'll most likely have the opportunity to perform a walkthrough of the property and confirm that the condition of the home is as it should be, as specified in the sales contract.

  • Bring enough cash

    At closing, you'll be paying for your share of the closing costs, and will be bringing the down payment, so be sure to bring a certified check or a cashier's check. Your lender will provide a lender's check for the remaining balance that's due on the home.

    Your HUD Uniform Settlement Statement (which both you and the seller will sign) will detail the closing costs (plus all the monies involved in the transaction), as well as who is expected to pay them.

  • Show id

    You will also be required to show proof of your identification, such as your driver's license or passport.

  • Proof of insurance

    Bring a copy of and proof of payment for your homeowner's insurance, plus your flood insurance policy, if you have one. Your lender may want to review these before allowing you to close on the home.

  • Sign on the dotted line

    To transfer ownership of the home, both the buyer and seller will be required to sign several documents.

    You may be required to review and sign the purchase agreement, a promissory note for your loan, mortgage documents, title documents, the settlement statement and the truth in lending statement (which will outline the costs of your loan, your payment schedule and amount financed), while the seller will also sign the settlement sheet -- and, importantly -- the deed to the home to transfer ownership of the property to you. Copies of these documents will be filed at the county recorder's office, but be sure to keep your own copies as well.

  • Take the keys!

    Once all the necessary paperwork is completed and everything is in order, you will be given keys to the home. While you will no doubt immediately change the locks upon moving in, the keys are the final sign that the home is indeed yours.


By Joe Salcedo,  Wed Oct 14 2009, 20:41
I love it and also for benefit of the new agents try to guide them in the right
By Isobel,  Thu Oct 22 2009, 07:47
I am buying a manufactured home, will this settlement be the same?
By Lori Jeltema,  Wed Nov 4 2009, 13:19
adding the reminder for the buyer to know WHO to make the check out to.
By Reginold Jones,  Mon Nov 9 2009, 06:32
This is great. Keep in mind that you may not get keys until the deed is actually recorded. At least in NC, that is when you LEGALLY take ownership of the home that you buy.
By Roseann Annis,  Sun Nov 29 2009, 09:19
Thank you for summarizing what occurs at settlement so aptly.
In the Commonwealth of Pennsylvania, the settlement company selected to handle the title searc, title insurance, and making sure that the HUD 1 settlement sheet is accurate and complete, is the entity which handles the disbursement of checks to lending institutions, brokers, and vendors such as inspectors.

With the advent of the new HUD 1 in January 2010, settlements will probably take about 45 minutes longer or approximately two hours.
By Debra (Debbie) Rose,  Mon Nov 30 2009, 00:37
Don't leave off the list - popping a bottle of champagne to celebrate after the closing! That's important, too.....
By Leanne Finlay,  Thu Dec 3 2009, 10:42
Buyers and sellers often misunderstand what the "closing" means. At least in Washington State, the day you sign your papers, and give your funds to the escrow company is generally NOT the closing date.

The closing date is the date all documents get recorded at the County courthouse, and generally, is the soonest date the new owner gets to take possession of the property. Often, that possession is a few days after the closing date, so that the former owner has the funds from the closing available to them. Often their funds are what they will use to close on their next home, meaning there may be a few days time lag from signing papers, handing over funds, closing, and taking possession.

Lenders can take a longer time to review signed documents from a "closing" table, so that also creates a time lag from signing paperwork to actual closing/recording.
By .,  Wed Dec 9 2009, 20:37
Becareful to always have a home inspection if you are buying a AS-is home

VJ Adriano
E-mail to: VJ@Mris.com
Cell: 301-357-5071

Sales & Leasing Associate MD, DC, VA
99 Commerce place
Largo, MD 20774
By Jim Paulson,  Wed Jan 6 2010, 23:11
I could add another 15 things or so to this list; however the main ones would probably be:
1) How and which utilities to change over (nothing like moving into a new home without utilities);
2) If your state offers home owners exemptions (like we do here in Ada County (Boise) Idaho; fill out the form so you pay less in property taxes;
3) make sure you get a copy of the plat map and CCR's of your property (should have received them well before closing though);
4) Ask for a copy of your appraisal;
5) Complete change of address forms with the USPS;
6) make sure you understand the financial stability of your Home Owner's Association (also should have been done prior to closing) so that you are not suprised shortly after closing with a "special assessment" to cure their insolvent finacing;
7) If you are a first time homebuyer or an investor, change your tax withholdings if you will be receiving a tax refund due to the new deductions you may not have had before;
8) Talk to your CPA and your financial planners to see what they suggest for your personal situations;
9) If they suggest "estate planning" talk to your attorney to help set that up;
10) If your Realtor, lender, title company, home inspector, etc., did a fantastic job refer them to your friends and co-workers!
By Dana Voelzke,  Wed Jan 13 2010, 19:11
One of the most common complaints of buyers is that the final check amount is not given to them until right before the closing. Just know that this is a common complaint and that there can be items such as oil adjustments that are added at the very last minute. Don't leave your downpayment funds so tight that extra items that may arise at the last minute stress you out!

Also, don't forget to get a copy of all of your closing documents including the title policy, HUD-1 final closing statement (used to put in for tax credit if you are eligible for the credit).

If you are making any payments shortly after closing such as common charges when purchasing a condo, make sure to note the address of where to send payments.
By Kathy Weber,  Sun Jan 17 2010, 11:43
Great Information from all!

That's what so great about throwing out good info.

People can add to it and cover all the bases.

Great thread!
By Marla McWilliams-Lopez,  Sun Jan 17 2010, 15:42
I'm with Debbie above....

Champagne at closing!

Although, our escrow company always has to remind me, "Marla, no alcohol at the signing table!!"

Gotta LOVE the celebration with clients!!
By Jo Soss,  Wed Jan 27 2010, 09:14
I think that the closing process is one that is just not explained in enough detail for many buyers. Here in WA being an escrow state I always make sure that my buyers visit with me the web site of the Escrow Association of Washington. There is a ton of information for buyers there. I incorporate into my buyer's package a list of "What Happens at Closing" so that we can discuss it at the initial buyer consultation.
By Lisa Quinter,  Fri Feb 5 2010, 12:42
Great job Trulia . . . great job!!! Thumbs up!
By Pat & Steve Pribisko,  Mon Feb 8 2010, 13:36
NORTHEAST OHIO HAS A VERY DIFFERENT CLOSING PROCESS: For those who buy and/or sell a home in Northeast Ohio, the process is quite different. We do not have round table closings. We have Escrow Closings. The Buyers' documents are signed at a site convenient to them. The Sellers' documents are signed at a site convenient to them. Wired Funds or a Bank Check are payable to the Title/Escrow Company & delivered by the Funds & Documents Date. On the Closing Date, the Buyers' Agent and Sellers' Agent wait to hear from the Escrow/Title Company that the transaction has filed and it is time to deliver the keys. Many times the Sellers & Buyers never meet each other. (This is just a brief description of the process)
By Jeri Creson,  Wed Feb 10 2010, 18:16
A well written article - and lots of great comments! One more suggestion: Ask your Real Estate Agent to accompany you. I always do this, and have not missed a signing in lo these 300+ transactions. Yet, often get comments from escrow about how rare that is these days. A very stressful and frightening moment can be avoided at the closing table when something on the closing statement doesn't look quite right if the representative who has guided you through this process can be on hand to make a few quick phonecalls and set everything right.

And then go ahead...pop that champagne!
By Archana Jayaraman,  Thu Mar 4 2010, 16:16
A good snapshot of what happens during closing!! Await the call from the escrow officer "Congratulations, the escrow is closed"!
By Tonya Brobeck,  Sun Mar 7 2010, 15:28
Great article! Thumbs up!!
By Johnny Yankoviak,  Sun Mar 14 2010, 16:51
And don't forget to give yourself plenty of time to get to the settlement. Here in Northern Virginia, traffic can be tricky!
By Yvonne A Russell,  Mon Mar 15 2010, 13:47
Looks like just about everything was covered but here are some closing setbacks to be aware of:

Showing up to closing without picture id
Buyers are married but information given to closer shows unmarried
Language issues such as Spanish speaking buyer but non-Spanish speaking closing officer.
Missing contract addendums that will change terms of sale
By David Nuss,  Thu Apr 8 2010, 22:11
Jim Paulson has a great list of additions with the best being to refer any of the service providers that did their work well while providing service during the closing.
By Tony,  Mon May 3 2010, 17:19
Nice article
By Jpage,  Thu May 6 2010, 13:51
As we just found out yesterday that here in Idaho you do dnot get the keys at closing - at least with a short sale. You must wait for the short sale bank to approve the HUD1 form then you get funded then you get keys and the short sale bank has 72 hours to give approval. Realtors and escrow agents please make sure clients know this it can be very stressful for them - I know!!
By Paula,  Fri Jun 4 2010, 03:40
Great article; however, could someone outline the process for a cash buyer?
By James Harp ®,  Sun Jun 6 2010, 19:16
Very good information provide by all who commented. I just attended my first closing in 3 years. Because all of mine have been done by mail by the title company and this title company does excellant work by keeping everyone informed on what and when things will be taking place.
By Henri And Jeri Gutner,  Tue Jun 29 2010, 05:54
It has become increasingly difficult to put some money in escrow to take care of repairs and defficiencies found at the final walk through. Nobody wants to hold that money, The broker, and the Title company shy away from it.
By Debra B. Albert, PA,  Fri Jul 9 2010, 08:37
This is awesome! Thanks for the wonderful article!
By Karen Parsons Fiddler,  Wed Jul 14 2010, 19:15
This is a nice clear, simple explaination.
By Thomas Watanapun,  Mon Jul 19 2010, 15:31
Cut and dry, great info!
By Edward E. Cambas,  Wed Jul 21 2010, 19:22
Thank You. I will be leaving pertinent info on this site. I am a real estate investor with 25 years of experience.
By Debra Allan,  Mon Jul 26 2010, 05:06
This is a concise synopsis and I will certainly share on facebook and twitter!
By J Mario Preza,  Sat Aug 21 2010, 17:38
The list of items included in this great guide are right on. However, the sequence or order of when things should get done may be a bit off, particularly for a buyer who has no clue of what is what or when to expect anything (for that matter, they don't know about expecting, deferring instead to what the agent cares to share with them). I find that many buyers have no idea about much of the paperwork or who does what, etc. This is even worse for non-English speakers. So, there ought to be some checklist of things to come, and a timeline to indicate when these things are to take place -- the sort of thing I do at the onset of my working with any client -- English or Spanish speaking. Thanks for the great insights though.
By Deborah Rutter,  Mon Aug 23 2010, 09:44
Don't forget to bring a calculator! Math mistakes, while not common, do happen, and all the math should be re-checked at the closing table.
By Rodney Honeycutt,  Thu Sep 23 2010, 09:43
Be sure you get your payment schedule correct. Our last house was to be bi-weekly mortgage payments. The paperwork was wrong, but was told it could be corrected with our lendor at a future date. They were right, but it was going to cost us several hundred dollars to move from a monthly to bi-weekly repayment schedule.
By Ajay Seo,  Mon Oct 4 2010, 08:23
I think it would be an good idea to take a Lawyer along.
By Judy Graff,  Tue Oct 5 2010, 11:32
If you're in California, attorney review is not required at closing.
By Betina Foreman,  Tue Oct 19 2010, 08:04
Thanks for an informative post on closing. Also kudos to Yvonne for bringing up a few excellent points. I always follow up with the title company the week before closing to ensure they have copies of all Addendums prior to close. It is easy for late negotiation details to slip past the title company, when one agent thinks the other agent sent it. Always better safe than sorry I say. Thanks again!
By Sean Farley,  Sat Nov 27 2010, 16:20
Good play-by-play on the closing expectations. Also, on the smaller details here in NJ, seller should have an original copy of Certificate of Continued Occupancy from the town showing that all their guidelines for safe occupancy have been met. In some cases, and if it is available lender closing packets and seller closing of title can be signed ahead of closing which will cut on the time spent on day of closing. I agree walk-thru should be 1hr prior to closing as you want to be sure that all inspection items are adequately addressed and and that all is as it should be for your first day of home ownership
By Dave Jones,  Tue Nov 30 2010, 20:00
Here is CT it has to be closed by an attorney. Some great tips!
By Sean Farley,  Wed Dec 29 2010, 14:04
A play-by-play that you best sports commentators couldn't have communicated better. Two additional items worth considering:
1. Be prepared that the negotiation is not always finished when you arrive at the closing table. There may still be a few lose details to work out, but keep your eye on the prize not the "Principle of It."
2. Agree that Walk-thru the day of closing is best scenario. The closer to closing the better to be sure everything is as outlined and promised in the contract and attorneys letters
By Judy Sharma,  Thu Dec 30 2010, 10:02
Great article and add ons. very helpful for new agents as well as buyers and sellers.
By Gerard Carney,  Tue Jan 4 2011, 06:33
Closings shouldn't be a mystery, Closing is the final act of sale and all parts of the sale lead to this very moment. As a buyer please make sure that your Realtor keeps you fully informed, try and have a copy of the HUD 48 hours before closing, be in full contact with both your Realtor and with the Title Company, both are working for you at this point. Make sure all expectations as to what you must bring to the table are clearly mentioned and in a timely manner. Ask if there are any items that have not yet been accomplished and what items may cause problems. Make sure your Lender is ready for this closing and that they have all monies needed on the table the day of the closing! Make sure all monies you must bring are there and accounted for at time of closing, make sure escrow amounts are correctly recorded and that they will be on the table on closing day! Make sure you do your final inspection or final walk through within 24 hours of closing and make sure all items agreed upon or mentioned in the contract are where they should be! Make sure you did all your requirements for closing especial all inspections and financing at the right times as requested by the contract. Have everything wrapped up and ready within the final 24 hours of closing! Ride all the professionals involved if you see short comings, your money hangs in the balance if there are things not done or done incorrectly. Be responsible for your end of the closing, this will keep you in favaorable eyes as far as contractual requirements. Ask questions constantly if you see things are wrong, hold professionals accountable for their duties as required by the contract.
As for the Seller the same appli0es, make sure that all the professionals involved with the sale of your property are doing what is required to complete the sales as outlined by the contract!
Remember the Closing should be well defined and outlined at least 48 hours before the actual closing, there should be nothing left to do but sign on the dotted lines, transfer of monies, and property, and the passing of the key from previous owner to the present one!
By Jennifer Blackwell,  Mon Jan 17 2011, 12:10
Good for buyers and new agents!
By Bill,  Mon Jan 24 2011, 00:14
what do cash buyers need to know? say i want to buy a home in lakeland,florida and i want to pay with cash...how would that process go?
By Amy Saffold,  Sat Mar 5 2011, 10:05
You will take a cashier's check or wire the money to the title company involved. The closing will take less than an hour as you will be closing on a home only, not a home and a mortgage. Any questions about fees or instructions would be best directed to the title company involved. Good luck, and congratulations!
By Karen Parsons Fiddler,  Mon Mar 7 2011, 11:31
These guides can be very helpful for buyers. Each state is unique, however and it's a great question to email a local Realtor® with.
By Jim Elliott,  Sun Mar 27 2011, 19:47
Good article. Ask lots of questions before you get to closing. Seems like something will always come up 12 hours prior to signing documents.
By Sammy,  Wed Mar 30 2011, 19:26
Anyone know what are the laws regarding foreign,overseas buyers? I am from Australia and have some relatives in the states but they are not very helpful.Was wondering if anyone here can shed some light on this matter,thanks.
By MARCO HUAMAN,  Mon Apr 4 2011, 18:09
Don't forget the ultimate and most important rule!!! Don't ever make late payments!!!
By Ranj Mohip,  Wed Apr 13 2011, 19:19
I tell my buyers to take the whole day off. In Chicago, an hour closing is unheard of.
By Donna Hills,  Thu May 5 2011, 17:54
My personal closing is an example of all that goes well when everything is lined up in advance of a closing. The closing was in PA and took less than 45 minutes. Being prepared is the key.
By Julie Booth,  Thu May 19 2011, 13:36
Remember that you can ask for an advance set of papers for your review before the signing. If you would like this option, be sure that your realtor, escrow and lender knows this so they can make this happen for you.

If your closing date is short, this may not be possible but it never hurts to ask!
By Takia C. Walker,  Mon May 30 2011, 15:46
Very useful information for both parties at closing!
By Constance Crawford,  Mon Jun 13 2011, 11:34
This is Great!
By Joanne Bernardini,  Sat Jun 18 2011, 08:34
Don't forget to tell the buyers that another cost of the settlement is the pro-rating of all the utilities, taxes and insurances. Example- If the seller has paid for a year in advance on the flood insurance policy they are entitled to a refund of anything past the day of settlement. Additionally, the buyers should contact the utility (and cable) companies in advance to transfer the accounts into their names as of the day of closing so there is no interruption of services.
By Carole O'Dell,  Thu Aug 4 2011, 19:13
This is exactly what I needed to forward to home buyers. Wonderful!
By Dorothy Alvarado,  Fri Sep 23 2011, 00:13
This is great information for buyers and agents.
By Arvada Plumbing,  Wed Sep 28 2011, 03:06
There's no doubt that your work, and site, are excellent.
Arvada Plumbing
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By Wes Black,  Sat Oct 1 2011, 19:35
Thank you for the great information. This should alleviate some of the anxiety that comes with the process.
By Christina Morabito,  Fri Oct 7 2011, 12:15
Great info!!!
Then make sure to have the locks replaced after closing!
By Wes Black,  Sat Oct 22 2011, 19:27
Outstanding summary of major processes.
By John Armstrong,  Mon Oct 31 2011, 20:32
You will need a valid ID. Your checkbook. Prior to attending the closing you should have a certified check in an amount your lender should tell you. At the closing make sure all questions regarding the loan are answered by your lender and about the house by the sellers.
By Akil Walker,  Fri Nov 4 2011, 15:17
Very helpful information for buyers. I would suggest a final walk thru before you to closing. this varies from state to state when you can conduct one.
By Shawn Ryan Rosa,  Tue Dec 13 2011, 11:34
I've never been asked for ID at a closing. Add I've been to many closings where the keys arent handed over - the seller may have forgotten them (if not living in the property, etc). The deal closes anyway and the buyer gets the keys later that day or the next day
By Steve Dykstra,  Wed Dec 28 2011, 09:00
First of all you should be very prepared for the closing if your buyer or seller realtor has done their job. If the realtor has made all the connections between the title company, bank, other realtor and other contacts, things should go smooth.
Your realtor should go over the HUD Statement in advance so there are no questions or disputes at closing. It is good to have a representative from the buyer’s loan officer at the closing so they can go over any questions about the loan. Make sure you use professional people help you buy or sell a home and your closing should go smoothly
By Jason Smith,  Thu Jan 12 2012, 19:30
Closing can be a simple process when the Agent has a pertinent role throughout the process with their client's lender, title company, etc.
By Kyle Baughan,  Mon Feb 20 2012, 15:08
Great article!!
Certainly unforseen issues can arise prior to closing however, you could ask your Broker/Agent to provide you with a "check list". Check lists, are very valuable tools and certainly help keep you organized and focused on items which need to be addressed, prior to closing. :)
By Adrian Provost,  Mon Feb 27 2012, 17:17
Nice post!
By Elena Talis,  Sat Apr 7 2012, 09:05
The process of closing varies by state and even by which part of the state you are in. Here in California the keys are usually passed to the buyer only after sale being recorded in the county. It usually happens two days after the buyers sign-off. The sellers can sign their paperwork much earlier, sometimes weeks before actual closing.
By Samantha Baksic,  Wed May 2 2012, 22:07
It's nice to have a succinct review of the process, though I know there may be variations depending on location.
By Lisa Montes,  Tue May 8 2012, 10:16
That's a great "what to expect" and how to guide for first time home buyers. I will be sharing this information with my first timers!
By Donald Stevens,  Fri May 25 2012, 12:02
Get multiple quotes for your homeowners insurance. You have a lot to do when buying a home and shopping for insurance is important. Most people keep the same homeowners company for over 5 years. You should be with a company that gives you the coverages you want at a price you can afford.

By Matie,  Fri Jun 15 2012, 02:44
Find a great home with http://www.indexpost.com/ and close it properly!
By Daniel Shi,  Tue Jun 19 2012, 14:31
Be sure to get adequate coverage for your home owner insurance. Your house is your most valuable asset; and the premium increase isn't as high as you may think -- considering property's location and physical condition (you can refer to its appraisal & inspection reports), be sure to get enough coverage to take care rebuilding/replacement cost should anything happen to your property. Personal liability coverage is also very important for you as a new home-owner; say in case your neighbor's kid should fall and break a leg on your property...you will be covered with adequate Personal Liability coverage.
By Jolie Muss,  Fri Aug 3 2012, 00:41
Thank you for this excellent guide! I would like to add to expect the unexpected and plan on the possibility that the closing could take hours especially here in Manhattan, so don't make any other important plans on closing day .
By Jeri Patrick,  Wed Aug 15 2012, 20:51
Great article and commens from everyone, thanks!
By Carmen Brodeur, JD,  Mon Aug 20 2012, 21:19
Great info. Thanks
By Jeff Metcalf,  Sat Nov 17 2012, 21:38
Thanks for sharing!
By Jennifer Ratcliff,  Fri Nov 30 2012, 07:15
Great post. Sharing this with clients.
By Elena Ravich, Esq.,  Tue Jan 8 2013, 08:34
Very insightful blog and great comments!
By Elena Ravich, Esq.,  Tue Jan 8 2013, 08:37
Wanted to add - remind your clients not to forget to bring their picture ID to the closing or they may have to run back home to get it and delay the closing.
By Nancy Robinson,  Mon Feb 4 2013, 18:20
Have your clients wire the funds they need to the title company. Many title companies are not accepting any sort of check. As all can be returned to their account with a deposit ap on a smart phone.

THIS ADVICE IS OLD SCHOOL! At closing, you'll be paying for your share of the closing costs, and will be bringing the down payment, so be sure to bring a certified check or a cashier's check. Your lender will provide a lender's check for the remaining balance that's due on the home.
By Michelle Johnson,  Wed Apr 24 2013, 13:48
Awesome guide! Very good information for buyers going to closing! :-)
By alexandrasteinz,  Sun Aug 18 2013, 19:56
Love this guide! I wish I had this when I closed my first apartment :(
By Troy Erickson,  Fri Sep 13 2013, 13:28
Closing should be an exciting time for anyone going through the stressful home purchasing process. This information you have provided is a great example of what to expect at closing so there are no surprises. Obviously your real estate agent should inform you of this process, and even be there for you at closing to answer any questions if you like.
By Judi Monday, CRS,  Mon Oct 28 2013, 13:47
A big must is to remind clients to bring a picture ID to the closing. Great information...
By Mike Hege, MRE,  Fri Nov 1 2013, 06:15
All good ideas & great comments! Make sure to leave NO stone unturned. If the client isn't happy with something they found on the walk through, be sure to get it in writing, pull in the attorney and resolve that right then and there. It is not fun to get a phone call later that day post closing about an issue that just popped up
By Ali Qureshi,  Wed Nov 6 2013, 21:58
Great tips! Important for all buyers!
By Elizabeth Sagarminaga,  Fri Jan 10 2014, 05:41
Indeed a very to-the-point article but as the various posts point out, the term "closing" itself may mean different things in different states. The best way to do this therefore is to run through the process with your realtor , your mortgage company and the attorney ( if there is one). Have a timeline with all the processes listed in correct sequence. Circulate it so that there are no surprises. Be sure that all other necessary steps have been dealt with. Then you can ensure a smooth closing. Else it could be very stressful.
By Heather Wright,  Mon Mar 10 2014, 14:27
Great post! Thank you for sharing!
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By Joseph Tsomik,  Tue Apr 15 2014, 10:43
Very useful information for both parties at closing. Thank you for sharing.
By Keri Watkins,  Tue Apr 22 2014, 11:32
Great article!
By Jim Cramer,  Mon Jun 30 2014, 18:14
Another great article packed full of good advice. This would be something that would be good to have clients read.
By Donna Mack,  Sat Jul 5 2014, 08:05
Great info thanks for sharing!
By Donna Mack,  Sat Jul 5 2014, 08:05
Great info thanks for sharing!
By Jim Cramer,  Mon Jul 14 2014, 09:38
Thanks again for a Tweet worthy guide!
By creditrepairelpasotx,  Wed Aug 20 2014, 12:28
Great information! Credit is essential when purchasing and I believe there needs to be more emphasis on ways to correct our imperfect credit system!

By KarenHaugs4f,  Fri Nov 14 2014, 09:20
Love this article! We have an office check list of things to do and I have been in this market long enough to read it from my head. Every closing is a little different. In Southern Indiana, HUD Settlement statements are all about the same.
Advice to the buyers, Plan your future and find the home of your dreams. A good agent will hold your hand through the process and be there for you even afterwards. Even though I tell people I need a crystal ball for Christmas, I know what all the steps are before they happen, so I look into the future.
By Noah Seidenberg,  Wed Jan 7 2015, 20:58
Great report any first time buyer can use
By Mark Saunders,  Tue Feb 3 2015, 10:16
By Katherine Dimacale,  Fri Feb 6 2015, 19:24
Great article. Thanks for the info, it’s easy to understand. BTW, if anyone needs to fill out an hud 1 settlement sheet form, I found a blank form here http://goo.gl/ggjWcJ
By djennifer009,  Tue Feb 24 2015, 16:36
Do you need to have a realtor or lawyer with you to close completely? I assumed they would need to be involved, but your list doesn't include their role. I guess they could have completed everything prior to the final moment. http://www.century21plaza.com
By Rameshall2u,  Sun Jun 21 2015, 20:52
At last, most likely several weeks after your offer to buy a home was accepted by the seller, you are preparing for the closing day. This involves you paying for the property, the lender (assuming you have one) funding your loan for a portion of that payment, and the seller transferring title — all of which are further described in the article, “Home Buyers: What Happens at the Closing.” But the most time-consuming part of the closing involves your reviewing and/or signing the various documents required to bring this about.

This article will describe those documents and provide tips on what you should look for -- or watch out for -- in your review.

Real Estate Transfer Documents

Most of the documents related to transfer of ownership of the property must be signed by the seller and delivered to you, the buyer. It’s important to review these for accuracy and completeness. With many state and local variations, the main purchase documents in your home purchase are likely to include:
•The deed. This document transfers the property from the seller to the buyer. State law dictates its form and language, but you can choose the form of ownership in which you take title: individually, in trust, in joint tenancy or in other tenancies. The deed is given to the county recorder of deeds to record, and made public. Recording your deed puts you in the property’s chain of title so that anyone looking at the county records can see that you took your title from the prior rightful owner, and therefore, own the property.
•The bill of sale. This transfers all of the personal property that is being sold along with the house, such as furnaces, air conditioners, appliances, light fixtures, window treatments, security systems, antenna, or cable or dish TV equipment, from the seller to the buyer. The document will typically list the property to be transferred, or refer to the contract that lists the personal property.
•The affidavit of title or seller’s affidavit. Although the actual name of this document varies by state, it is a sworn, notarized statement by the seller confirming ownership of the property and describing any known title defects such as leases, liens, or work on the property that could potentially create liens, boundary line disputes, or outstanding contracts for the sale of the property.
•Transfer tax declarations. Many states, counties, and municipal governments charge real property transfer taxes and require the buyer and seller to sign declarations disclosing the purchase price and calculating the tax.
•Buyer/seller settlement statement. This document shows all of the monetary transfers between the seller and buyer, including the purchase price, down payment amount, payment of brokers’ commissions, attorney fees, escrowee fees, surveyor’s fees, title insurance fees, county recorders fees for the recording of the deed and mortgage, transfer tax payments, credits for tax payments, and agreed repair credits. This information is used by the escrowee to prepare the HUD-1. Both the buyer and seller will sign this document.
•HUD-1. The HUD-1 is the universal settlement statement that shows all of the money transfers by and among all of the parties to the closing. It is required to be used for all closings involving a federally insured lender by the Real Estate Settlement Procedures Act (“RESPA”). (See 12 U.S.C. §§ 2601–2617.)

Home Loan Documents

The loan documents are prepared by your lender or a servicing agent for your lender. How many documents you have to sign and what’s in them will depend on the lender and the type of loan you chose. The typical loan documents are:
•The note. This provides evidence of your debt to the lender, a description of the loan terms, and a means for the lender to transfer or collect the debt. It will state the amount of the debt, the initial interest rate, the terms of any interest rate changes, and the time and place that you must repay what you owe. The note has value in and of itself, just like a check or money order. If your lender sells your loan (as is common), it will physically give the note to the loan purchaser.
•The mortgage. The mortgage is your agreement to put up the property as collateral for the loan. It is recorded, along with the deed, in the county recorder’s office, and becomes a lien against the property — meaning that the lender owns an interest in your property up to the amount outstanding on the loan at any given time. In literal terms, the lender can foreclose upon and sell the property if you fail to repay the loan or otherwise comply with its terms.
•Loan application. You completed a loan application form when you first applied for the loan. The lender will type a new form with the information that you gave in the original application for the closing, and ask you to review it for accuracy and sign it. If your financial position has changed since your original application -- for example, you have lost your job or taken on another credit card or debt -- you must inform the lender before signing.
•Truth-In-Lending Disclosure (“TILA”).Required by the Truth-In-Lending Act, (15 U.S.C.A. § 1601 et seq.) and "Regulation Z” (12 CFR Part 226), this is a standardized explanation of the financial terms of your loan. Key information disclosed within includes: •The annual percentage rate (“APR”). The APR is always higher than the interest rate because it is calculated by combining the amount of interest to be paid over the life of the loan with the prepaid finance charges computed as an annual rate.
•Finance charges. These are the sum total of any and all charges for the loan, including all interest to be paid over the life of the loan, mortgage insurance premiums, and prepaid finance charges.
•Amount financed. This is intended to disclose the economic benefit of the loan. It is calculated as the principal amount of the loan minus most of the charges being paid out of loan proceeds such as points and certain closing fees, as shown in your Good Faith Estimate of Closing Costs (described in greater detail below).
•Total payments. This is the amount of money that you will pay at the end of the loan term if you make every payment on time for the entire life of the loan.

Various other disclosures and agreements may be included in the loan package. In the compliance agreement, you agree to cooperate if the lender needs to fix any mistakes in the loan documents. IRS forms W-9 and 4506 allow your lender to report your mortgage interest and obtain copies of your tax returns. Servicing disclosures tell you if the lender is going to use a servicer to collect your payments, or whether the lender intends to sell your loan to another lender or an investor, and where to send your payments. Tax and insurance escrow forms allow the lender to charge and hold fund to pay real property taxes and insurance premiums on your behalf.

The lender may also ask you to sign affidavits certifying that you are going to occupy the home as your primary residence, and confirming your legal name and any other name you may use on accounts and legal documents.

Real Estate Title Documents

Just when you think you are finished reviewing and signing documents, the title company and escrowee will give you their documents.

The main title document is the title insurance commitment (the “Commitment”) showing the party in title (who owns the house), hopefully the seller. It will also show all of the liens or other clouds on title. If you have one, your attorney will review the Commitment to make sure that title is in the condition promised in the contract and otherwise acceptable under local law and custom. If you are relying on an escrow company, it will review the Commitment to make sure title complies with the conditions stated in the escrow instructions created to satisfy the lender’s requirements. If title is not acceptable, the seller may have to pay off additional liens, or obtain additional signatures. Unexpected title issues could halt or delay your closing.

CAUTION: Some title issues can be very complex. If your seller does not have an attorney, or if local custom dictates, you may have to do more to ensure title will be good in time for the closing. If neither party has an attorney, you may wish to contact the title company well prior to the closing to obtain the Commitment, and review it with a title underwriter.

The title company will ask you to sign its customary closing documents. This will include an ALTA statement, which is a one-page affidavit very similar to the seller’s affidavit of title; a judgment affidavit, where you list your recent judgments, divorces, or bankruptcies; a compliance agreement, in which you agree to cooperate with the title company to correct any closing mistakes; and a disbursement agreement, allowing the title company, as escrowee, to disburse the loan proceeds. There may be additional disclosures informing you that an attorney is involved in the transaction, or that the lender has an affiliated businesses arrangement with the title company, or that the loan title insurance policy will not cover your interest as the buyer.
By Brenda Haynes,  Wed Jul 15 2015, 13:22
Great Information
By Bob,  Mon Jan 25 2016, 09:43
Great information, this is very sound advice on what to expect on closing a deal.
By Kevin Baker,  Wed Mar 16 2016, 14:54
This is great information to a new buyer or a seasoned buyer. Buying a home is a big task and doing it with a great professional Real Estate Agent can make a big difference for both your pocket and for stress.

Kevin Baker, Kevin Baker Homes Real Estate Team, Keller Williams Houston and The Woodlands
By Alyssa2077,  Thu Apr 14 2016, 21:43
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By Ana G,  Mon May 2 2016, 14:09
It's even easier if you sell your house to a "We Buy Houses in Florida" company like http://bit.ly/webuyhousesflorida. You wont have to pay any closing costs. Try it out at least.
By Ana G,  Mon May 2 2016, 14:10
It's even easier if you sell your house to a "We Buy Houses in Florida" company like http://bit.ly/webuyhousesflorida . You wont have to pay any closing costs. Try it out at least.

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