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The Closing Process

You've found a home and a mortgage too, but there's one more step before you move in and start making mortgage payments. The closing.

It used to be that applying for a mortgage was a difficult process with tons of paperwork. It took days to find out if you were approved and weeks to close.

 

Well, no longer. With such tools as the Internet and a wide array of mortgage programs available, applying for a mortgage has become much quicker and easier. So it follows that the closing process has also become quicker and easier. With some loans, it's even possible to close in as little as a week.

 

What is "Closing"?


Closing completes your real estate sale and loan transaction. Some, or all, of the following parties can attend a closing:


  • Seller
  • Buyer
  • Lender
  • Attorneys
  • The Seller's mortgage holder
  • Representative from the title company

At the closing you'll sign a variety of documents that make your home purchase official. You'll also be responsible for paying several different fees, such as title insurance, private mortgage insurance (PMI), legal fees and property taxes, to name a few.


Closing costs vary by state. Ask a mortgage banker how much your closing costs will total so you know what to expect on closing day.


Timing Your Closing
The timing of your closing is very important and depending on the date, can save you quite a bit of money. For example, if you're currently renting an apartment, you'll want to schedule your closing toward the end of your lease to avoid paying unnecessary rent.


Lenders are eager for your business and are working harder these days to simplify the mortgage process. Before you schedule to close your loan, ask a lot of questions so that you'll know exactly what to expect and how long it will take



By Diane Tuman

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  • Last edited October 12 2012
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