Yea!!!!!!! You have gotten your mortgage loan approved and "clear to close"! You are ready to go to settlement but, as you may have guesed, there is one more step.
The closing. To close on a mortgage transaction you need to have loan documents prepared, funds ordered and sent to the title/escrow company and a closing scheduled with all parties (you, the sellers, the Realtors and the title company).
The closing department needs to review the loan approval, the rate lock (usually handled by the mortgage processor and/or the loan officer) and the title report to accurately prepare your loan documents. Once this has been done, the documents are sent from the closing department at the lender to the closing department at the title company. The lender will give instructions to the title company on what to put on the settlement statement, also called a HUD-1. Once the title company has complied with the lender's instructions the lender will approve the final settlement statement and you are ready to close!
You will go to the scheduled closing and sign your loan documents. The closer from the title company will guide you through where you need to sign and may be able to answer questions you may have about what you are signing. If you have any questions about a document that they cannot answer please contact your loan officer before you sign it!
This is a complicated process but do not sign anything that you do not understand or doesn't look like what you agreed to. Questions at closing can save you so much time, money and heartache in the long run. Do not take anyones word for something that is not in black and white. Closings can be rescheduled, loan files can be re-underwritten, closing documents can be corrected but once you sign and the deal is closed you have an obligation that will last for the 10, 15, 20 or 30 years.
Congratulations! You're finally done.
YAY!!! Party time! For all the years I have spent in this business, I still can't get over some Loan Officers don't attend the closing! If I was interviewing Loan Officers, I'd make sure that the question of "Will you attend the closing?" was answered in the affirmative. If not, I'm looking for another LO!
Beth - Wonderful explaination of what clear to close really means. Here attorneys handle all closing documents, not title/escrow companies. And one last thing you need before you can close here, loan must fund before the documents are signed.
This is such a clever little series Beth. I'm going to read and bookmark them all, but wanted to come over and say 'hey'!
Those magic three words in Real Estate... Clear To Close!
I always take my buyers to closing and immediately ask, so ready to sign your life away?
I have a page on my website http://www.maureenmegowan.com which discusses the various closing costs that a buyer or seller will see at closing. Just check out my website and click on the page labeled "Closing Costs".
Maureen- thanks for stopping by. This was actually the last of a series of posts about the mortgage approval process. Closing costs are a whole different topic. I will certainly check out the information on your site. I do find that a lot of that is very state specific so I have been reluctant to tackle that as a general subject.
I agree with Scott. If your loan officer is not going to attend your closing, find another! I attend all of my closings whether they are purchase or refinance. Also, a loan officer sitting at the table looking their client in the eyes is usually a very honest person.