Closing your mortgage loan is the final, and arguably the most exciting part of the home buying process. Reaching the closing table means you’ve stuck out the entire loan process with your SMC Mortgage Banker and the home you want is almost yours. All that is left to do is for you to sign the paperwork declaring you the owner of your home, and you get the keys to your new abode!
In preparation for the day of your big closing, you will likely be contacted by your realtor or SMC mortgage banker to set up a time and date for said closing. Before you sit down at the table, it’s good to know what to expect; that is why we created this Closing Guide!
The best way to prepare for your closing is to familiarize yourself with all aspects of your loan by reading your Closing Disclosure. Your Closing Disclosure is provided to you no fewer than three days prior to closing. Your Closing Disclosure is a detailed overview of your origination charges, services, taxes and government fees, prepaids, escrow, and all other costs incurred, both paid and unpaid.
The Closing Disclosure can be explained to you by your SMC Mortgage Banker. If you have any questions, you’re encouraged to reach out to your SMC Mortgage Banker with any questions or concern prior to closing.
Owner’s Title Insurance
Another way to prepare for your closing is to read up on title insurance. When you purchase a home, you’re actually purchasing the title of ownership. It is possible that someone other than the owner could claim ownership or rights to the property by way of inheritance, forgeries, liens, creditor claims of past owners, undiscovered easements, or other defects undiscovered during the title search – which is where Title Insurance comes in.
Title insurance essentially protects you from hidden defects on your title that could surface at any time during the ownership of your property. There exist two types of title insurance: a lender’s policy, which assures the lender they have an enforceable lien on your property (however, this does not protect you in any way); and an owner’s policy, which protects you from defects prior to the date you were issued your policy and it covers the cost of any legal defense on your title. It’s a good idea to educate yourself on Title Insurance, as well as weigh your options, before you sit down at the closing table. Ask your SMC mortgage banker for more information.
What to Bring
- Other borrowers on the loan
- Your spouse, if they are on the deed
- Two (2) forms of ID (if you’re the buyer)
- One (1) form of ID (if you’re the seller)
Note: One form of picture ID for both parties must be an unexpired driver’s license or a state identification card with a photo.
- Cash to close (No personal checks – a cashier’s check is most commonly accepted for amounts over $500)
- An ink pen (Just kidding, ink pens will most likely be provided…)
Ask your realtor or SMC mortgage banker if you need to bring anything else as it pertains to your closing.
At the Table
When you go to closing table, there will be a few people there. Don’t let this overwhelm you. Depending on the number of sellers and buyers, the room can get full quickly – but everyone there is present in support of your purchase or refinance.
You might see the following:
- Realtors for both buyers and sellers
- Your Mortgage Banker
- A Closing Agent
Purchasing Vs Refinancing
The closing table can look a bit different when you’re purchasing versus refinancing. In a purchase closing, there will be a buyer and seller represented. However, at a refinance closing, only the homeowner, the homeowner’s Mortgage Banker and Closing Agent (and no realtors) are present.
You’ll encounter a great deal of paperwork on the day of your closing. Be sure to do hand exercises to avoid cramping, as there will be lots to sign! Here are some documents you’ll see:
- The deed – the legal document transferring the title of the property from the seller to, you, buyer, reflecting the buyer as holding title and ownership of the property.
- The note – a promise to pay back the loan which states when your loan must be paid and interest details.
- A copy of your mortgage – Secures the note and records it in county records.
- Loan application – A copy of your loan application is provided to you.
- Loan Estimate and Closing Disclosure – Another copy of both of these items are given to you at closing. See our Understanding TRID Guide.
Handshakes & High-fives
Once the paperwork is signed, you can shake hands (or give high-fives, if that’s what you’re into) because you’re a new homeowner (or perhaps a happier homeowner if you’ve just completed your refinance)!
If you have any questions, pick up the phone and give your SMC mortgage banker a call today!