The final step in purchasing a home with a mortgage is called “closing.” If you’re not a first-time home buyer, you probably are already well familiar with the closing process and what it can entail.
But if you are purchasing your first home, you may not know what closing is or what you can expect on closing day.
When you close on a home, that is when you will be signing all of the applicable documents are purchasing a home and taking out a mortgage.
The closing process can vary from state to state and from one lender to the next. It can be in person or not. Closing can happen on a single day, several days, or even several weeks.
The following parties will potentially be involved in the closing process:
- Your attorney
- The seller
- The attorney representing the seller
- Your mortgage company
- An escrow company
- A title insuarance company
The exact parties, like the exact timing, can vary from one closing to another.
A range of documents may be involved as well. Typically, you will need to review and sign the following:
- Closing disclosure: This is among the more expensive documents involved in closing. You will be able to peruse it in the days preceding closing. The full terms of your loan will be contained in this document.
- Mortgage note: By signing this document, you are agreeing to pay back the loan in full.
- Mortgage: This is the document that states that your lender can act against you if you do not meet your mortgage note payment requirements.
If closing requires that you attend a physical meeting, be sure to bring documentation with you, including proof of identity, the contract which you signed with the seller, proof of homeowner’s insurance, the reports from your inspection(s), and any additional documents which you are told to bring.
If you are required to pay closing costs, you will need to do so at this time. The exception would be if you had the option to bundle your closing costs in with your home loan.
Note that there are cases where the seller may cover the closing costs so that you do not have to. This is most common with government-backed loan programs, which also tend to cap closing costs paid by the buyer.
During a consultation with a mortgage broker, you may want to bring up the closing process and ask what specifically closing with that company will entail.
This is especially important if you are in a situation where closing fast is going to be a requirement to buy a property in time.
Some mortgage brokers specialize in super fast closings, especially for investors and fix-and-flip buyers.
We’ll Walk You Through the Closing Process Step by Step
Have more questions about closing on a home? GoPrime Mortgage can describe the process to you in detail during your consultation so that you know exactly what to expect and prepare for.
If you are ready to begin, please call us today at (205) 495-0313. We look forward to helping you close fast on the home of your dreams in Alabama.