Your Guide to Closing

Taking out a home loan can feel intimidating, especially if you are a first-time homebuyer, but it doesn’t have to . As a general overview, the process for homeownership usually consists of shopping for a home, applying for credit, receiving your conditional approval, entering into a contract for a home, going through the loan underwriting process, final approval and then finally, closing.

Closing, or settlement (as it is sometimes referred to), is when you sign all the necessary paperwork to finalize the financing of your home purchase. This is the final stage for you to purchase your home. After signing, you are typically given the keys to your home. However, if you are purchasing a manufactured or mobile home, you may not get your keys just yet. This will happen when the home is safely delivered and set up.

Typically, when you get to closing day, you will need pay for your closing costs and any other fees not included in your loan along with your down payment. We have already discussed what closing costs are, but let’s look at the closing process a little closer.

If you are taking out a mortgage, your Closing Disclosure will be given to you at least 3 business days prior to your close date for you to review. This document will lay out the latest specific costs for your payment, as well as the details of your transaction. For example, it will provide the interest rate, monthly payment amount, how much you are financing, and the breakdown of fees or escrow, along with the amount of funds to be expected to bring to the table.

Once you have been cleared for closing, you will then typically work with the company that will be closing your loan as well as your lender to set a day and time. Closing can involve working with various entities, such as a title company or a notary. Don’t worry though, we will help you every step of the way on what the process will be for your specific loan.

After the closing is scheduled and the big day arrives, you will show up to the closing location to sign all the paperwork required to finalize the loan. While there, there will be several documents to sign, and your final loan terms should be consistent with what you discussed with your loan originator as well as the paperwork you received up until this point.

Once all parties have signed, the closing documents will be sent back to your lender for review and funding (if not yet done). Here at Vanderbilt Mortgage and Finance, Inc., once a loan funds, we will call you to welcome you and review your loan information.

Typically, at that point in time, the next step is to move in and make your house your own!

Want to learn more about how to satisfy your loan conditions? Read on to find out what documents are typically needed.