The Final Step - Going to Closing

 



Finally – it’s closing day! With you at the closing will be your attorney, the buyer’s agent, the seller’s agent and all owners. The attorney will have searched the title, updated the survey and abstract, provided title insurance, and acquired lender instructions.

After all unresolved walk-through issues are settled, the attorney will explain the following:

  • Deed of trust or mortgage
  • Deed of trust note or mortgage note
  • VA, FHA, or lender forms
  • Settlement sheets

You, as the buyer and the seller will then sign all necessary forms. The seller may have the option of signing their paperwork prior to closing and therefore not attending that day. Using a certified bank check you will be required to pay the balance of the down payment and your closing costs.

 

A Closer Look At Closing Costs
Prior to the closing, under the Real Estate Settlement Procedure Act (RESPA), your lender will give you an estimate of closing costs (good faith estimate). Typically, you will have paid the appraisal fee and credit report fee at the time of making formal mortgage application, if you did not, those amounts will also be due and payable.

Closing costs usually average between 3% and 7% of the sales price. Typical closing costs include:

  • Loan origination fee
  • Mortgage insurance premium
  • Attorney fees
  • Owner and lender title insurance
  • Recording fees
  • County tax stamps
  • State tax stamps
  • Survey fees

In certain cases, some of the closing costs may be paid by the seller. This is particularly true for new housing, where the seller is the builder.

A few other expenses, not required to be listed under the law, may be due at the closing. These include advance deposits held in escrow for real estate property taxes and home owner’s insurance. If these items are escrowed, the bank collects a percentage of these monthly and makes the insurance and tax payments when they are due.

Sometimes closing costs can amount to a considerable amount. Don’t forget some of these expenses are tax deductible. The loan origination fee, prepaid interest, and property taxes just to name a few.


Congratulations
Once the paperwork is signed, you are given the keys to your new home and you can begin moving in immediately. Congratulations!