Close on Your New Home
A “closing” is where you and I meet with some or all of the following individuals: the Seller, the Seller’s agent, a representative from the lending institution, and a closing attorney. The purchase agreement or contract you signed describes the property, states the purchase price and terms, sets forth the method of payment, and usually names the date and place where the closing or actual transfer of the property title and keys will occur. This usually takes place at the closing attorney's office.
If financing the property, your lender will require you to sign documents, as evidence that you are personally responsible for repaying the loan. You will also sign a mortgage or deed of trust on the property as security to the lender for the loan.
The mortgage or deed of trust gives the lender the right to sell the property if you fail to make the payments. Before you exchange these papers, the property will be appraised and the ownership of title will be checked in county and court records.
At closing, you will be required to pay all fees and closing costs in the form of “guaranteed funds” such as a Cashier’s Check. The closing attorney will notify you of the exact amount.
What is an Escrow Account?
An escrow account is a neutral depository held by your lender for funds that will be used to pay expenses incurred by the property, such as taxes, assessments, property insurance, or mortgage insurance premiums which fall due in the future. You will pay one-twelfth of the annual amount of these bills each month with your regular mortgage payment. When the bills are due, the lender pays them from this escrow account. At closing, it may be necessary to pay enough into the account to cover these amounts for several months so that funds will be available to pay the bills as they are due.
What to Bring to Closing
- Proof of Homeowner's Insurance (Check with your Lender for Details).
- Photo ID (Driver’s License, Passport, Picture ID).
- Power of Attorney Information, if Applicable, Prepared in Advance (At Least Two Weeks Ahead) by Closing Attorney. Check with your Lender First for Approval.
- Certified Funds Made Payble to Yourself.
- Your Check Book (Closing Attorney can Accept a Personal Check for $5000 Max).