{"id":17961,"date":"2020-07-31T10:23:24","date_gmt":"2020-07-31T17:23:24","guid":{"rendered":"https:\/\/www.homelight.com\/blog\/?p=17961"},"modified":"2020-07-31T10:23:24","modified_gmt":"2020-07-31T17:23:24","slug":"buyer-closing-documents","status":"publish","type":"post","link":"https:\/\/www.homelight.com\/blog\/buyer-closing-documents\/","title":{"rendered":"Countdown to Closing: Key Documents You Will See, Touch and Sign When Buying a House"},"content":{"rendered":"

Whether you\u2019re a first-time homebuyer<\/a> or well-seasoned as to the ins and outs of home purchases, the closing<\/a> process can be a stressful and confusing time. Those last few days before your house is yours are often a whirlwind of last-minute documentation, requests from your lender and title company, and meetings with your real estate agent.<\/p>\n

Then you sit down to close and have to read and sign what amounts to a serious stack of paperwork, and before you know it, you start feeling like you\u2019re signing the same document over and over again.<\/p>\n

It may seem daunting, but we broke down the closing process to make it easy to understand and spoke to top escrow agents and experienced agents who have taken many buyers through those final steps.<\/p>\n

Starting from when you get the initial Closing Disclosure to the moment you clutch the keys to your new home, this list will help you understand and identify many of the key documents you\u2019ll see or sign during your home closing. We\u2019ll also guide you on what to bring to the closing table, special issues to be aware of, and how to prevent any unwelcome surprises along the way.<\/p>\n

\"The<\/a>
Image Source: (Shutterstock.com\/JohnKwan)<\/figcaption><\/figure>\n

Closing documents for your home purchase<\/h2>\n

Here are some of the key documents you can expect to see during the closing process.<\/p>\n

Three days before<\/h3>\n

Closing Disclosure<\/h4>\n

Your lender is required to send this document three business days prior to closing. The Closing Disclosure outlines your mortgage loan<\/a> terms and conditions, payments, and the funds required to close<\/a>.<\/p>\n

Buyers need to make sure they read and understand this document before closing, as any changes will result in a delay.<\/p>\n

One to two days before<\/h3>\n

Proof of homeowner\u2019s insurance<\/a><\/h4>\n

You are required to provide your lender with proof of insurance on your new home prior to closing. Contact your insurance agent at least a few days prior to closing so that they can get the insurance rider to your lender.<\/p>\n

One day before<\/h3>\n

Secure your funds<\/h4>\n

Make sure you have your funds ready to go, including your down payment<\/a> (minus the earnest money<\/a> you already paid) and closing costs<\/a>. Confirm any wire transfer instructions directly with your title company.<\/p>\n

Day of closing<\/h3>\n

Loan application<\/h4>\n

You will review and sign your original loan application one more time.<\/p>\n

Promissory note<\/h4>\n

This covers your commitment and responsibility to the mortgage loan. Make sure you read it thoroughly, as this is your acknowledgement that you understand you are financially responsible for the loan.<\/p>\n

Deed of trust or mortgage contract<\/h4>\n

The deed of trust or mortgage contract (depending on which state you live in) legally puts your home up as collateral for the mortgage loan. If you default, ownership will revert to the lender.<\/p>\n

Title documents<\/h4>\n

These documents will tell you who else has owned the home and verify there are no liens on the property. This will also include title insurance, which protects you in case the title search didn\u2019t uncover an existing lien.<\/p>\n

If a lien is found after closing, your ownership could be in jeopardy. But if you purchased title insurance, the title company will fight any claims on your behalf.<\/p>\n

Deed<\/h4>\n

This transfers ownership of the home from the seller to you. The seller will sign off on it first, and it is sent to the city or county recorder after closing.<\/p>\n

Affidavits<\/h4>\n

Title companies often require buyers to sign affidavits that confirm their identity and legal name.<\/p>\n

\"A<\/a>
Image Source: (Shutterstock.com\/moreimages)<\/figcaption><\/figure>\n

Transfer of tax declarations<\/h4>\n

Depending on your state\u2019s laws, you may have to sign paperwork disclosing the price of your home and the sales tax you owe.<\/p>\n

Certificate of occupancy<\/h4>\n

This is sometimes required for a new build<\/a>. It certifies that the home is in compliance with all building codes and laws, and that it is suitable for occupancy.<\/a><\/p>\n

Bill of sale<\/h4>\n

This transfers any property in the home to the buyer that the seller has agreed to include with the sale, which could be anything from appliances to furniture. You will want to verify that all items previously agreed upon are listed on the bill of sale.<\/p>\n

Riders<\/h4>\n

These documents are usually part of the closing package when purchasing condos or non-owner-occupied properties, and they clarify additional terms to the original contract, such as if a lender charges a penalty for paying off the loan early.<\/p>\n

\"An<\/a>
Image Source: (Shutterstock.com\/Simone Hogan)<\/figcaption><\/figure>\n

After closing<\/h3>\n

Escrow account disclosure statement<\/h4>\n

You\u2019ll receive the escrow disclosure within 45 days of closing, and it provides information about the escrow account created by the lender. The lender collects your taxes, insurance, HOA fees<\/a> \u2014 and private mortgage insurance (PMI)<\/a> if you\u2019re paying it \u2014 in this account and makes the payments on your behalf.<\/p>\n

What you need when you close on your new home<\/p>\n

Sandy Moursy, a Senior Escrow Officer<\/a> with Chicago Title of Nevada, has more than 25 years\u2019 experience in the industry.<\/p>\n

She says that the main thing buyers really need to physically bring to closing is their valid photo ID. \u201cOne thing a buyer should be aware of is that the notary, who authenticates signatures at closing, requires that the names on the closing documents are the names as are listed on your identification,\u201d she explains. \u201cIf you\u2019ve recently married but haven\u2019t changed your name, you need to make sure the closing documents are prepared in your current legal name.\u201d<\/p>\n

You should also talk to your title company about whether you\u2019re required to bring a separate cashier\u2019s check for closing costs, and also verify the amount. You will usually send a wire transfer of the down payment directly to the title company \u2014 again, you will want to confirm this.<\/p>\n

Both Hanna and Moursy say that one of the bigger problems that buyers may not be aware of is wire fraud<\/a>. Says Moursy: \u201cThe title company will email the buyer wire instructions for the down payment and closing costs, and that email is usually encrypted to protect from fraud. But sometimes that email can still get intercepted by scammers. They will send a fake email that looks just like the title company\u2019s email, requesting the buyer wire the money to them.\u201d<\/p>\n

Adds Hanna, \u201cI tell my clients that before they wire any money, they should call the title company to verify that the email they received is valid. There are a lot of scams going on these days, and even when the instructions look legitimate, they might not be.\u201d<\/p>\n

Moursy also notes that buyers should not call the phone number listed on the email they receive, because if it is fraudulent, the phone number is most likely fraudulent as well. \u201cLook up the phone number of the title company separately,\u201d she advises. \u201cI\u2019ve had buyers call the number on the email they received, only to end up talking to the scammers instead of the title company.\u201d<\/p>\n

In order to make the closing experience more seamless, Moursy urges buyers to get any requested documents to their lender in a timely manner above all else.<\/p>\n

\u201cThe lender needs 30 days to prepare for closing, so when they ask for certain things, it\u2019s important to provide them right away,\u201d she says. \u201cThe closing process is time-sensitive, and having everything in on time is crucial. If you don\u2019t get those requested items to the lender, the closing may have to be delayed.\u201d<\/p>\n

\"A<\/a>
Image Source: (Shutterstock.com\/hobby kaak)<\/figcaption><\/figure>\n

Closing pitfalls to avoid<\/h2>\n

While closing on your new home is usually a straightforward process, there are potential pitfalls and unexpected surprises that buyers might encounter. Las Vegas<\/a> Realtor Daryl Hanna<\/a>, a 17-year veteran of the industry, says he advises his buyers to make sure to have the lender review the estimated Closing Disclosure with them prior to the actual closing date.<\/p>\n

\u201cI\u2019ve seen a lot of buyers walk into closing, and the Closing Disclosure shows additional expenses or a higher-than-expected payment<\/a>,\u201d he says. \u201cIt is very important that buyers know what their final numbers are, from their interest rate to final closing costs to payment. You don\u2019t want any surprises.\u201d<\/p>\n

How a quality agent can make for a seamless closing on your new home<\/p>\n

You might think that your agent is just there to help you find a house, but a good agent will stay with you every step of the way, by your side from the moment you make your initial offer to the keys being placed in your hands. Having an agent you trust<\/a>, alongside a reputable lender and title company, can help make the closing process a positive experience.<\/p>\n

Moursy says that having a dependable agent is really the key to making the whole process easy for a buyer. \u201cIf a buyer doesn\u2019t have a good agent, sometimes they end up communicating primarily with the loan officer whose primary responsibility is to the loan, not the actual purchase transaction, and there can often be last-minute issues with the property or the seller that can pop up that the buyer doesn\u2019t find out about until closing day\u201d she says. \u201cIt\u2019s important to have an agent who stays on top of any problems.\u201d<\/p>\n

Hanna and Moursy agree that your agent should be proactive in solving problems as they arise, keep you informed of changes, and communicate with the lender and title company as needed in order to make closing on your new home stress-free.<\/p>\n

For Hanna, those moments of closing are some of the best. \u201cEven if the transaction has rough spots, closing is usually when a buyer is the happiest,\u201d he says. \u201cGetting those keys in hand is one of the most joyous parts of the transaction.\u201d<\/p>\n

Header Image Source: (Shutterstock.com\/Jat306)<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

We\u2019ve created a comprehensive list of the closing documents a homebuyer will see and sign during closing, as well as information on potential pitfalls.<\/p>\n","protected":false},"author":178,"featured_media":18005,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"content-type":"","cybocfi_hide_featured_image":"","footnotes":""},"categories":[192,700,646],"tags":[],"class_list":["post-17961","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-for-buyers","category-buyer-contracts","category-making-offers"],"acf":[],"yoast_head":"\nClosing Documents: Which Ones Will You See As a Buyer?<\/title>\n<meta name=\"description\" content=\"We\u2019ve created a comprehensive list of the closing documents a homebuyer will see and sign during closing, as well as information on potential pitfalls.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, 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