Guaranteed Rate Investigates: The closing process
It’s the magic word: closing. (AKA, you’re almost there!) We know tensions are high and you’re anxious to complete your purchase or refinance and “close.” But what does closing actually mean?
In the latest edition of Guaranteed Rate Investigates, we dig deep into the closing process—answering the “Five W’s” (and an H) to ensure you know exactly what to expect.
Who attends a closing?
This varies state by state, but typically: you, your attorney, your closing agent, the title company’s representative, the seller(s) and their real estate agent, although sometimes the sellers are able to pre-sign deed and transfer documents.
What do you need to bring?
A form of photo ID and your check to cover the closing costs and down payment (unless you previously wired the money). Your check will need to come from an account that has been approved by your mortgage professional and underwriter prior to issuing your clear to close.
Where do closings take place?
Purchase: Chosen by the seller, closings typically take place at a title company or attorney’s office.
Refinance: Depending on which state you’re in, you may be able to close from the comfort of your own home. If you’re located in a state that requires an attorney or escrow agent to close your loan, you’ll need to discuss a location.
When do you know your closing is finished?
Purchase: When you receive your keys! You may need to wait for the lender’s wire to clear (your actual loan) and then you’ll receive your keys and be sent on your way with copies of all the documents.
Refinance: If you’re refinancing your primary residence, your loan will fund once the three-day right of rescission has expired (on the fourth day). Once the rescission period has expired, you can no longer cancel the loan. If you’re refinancing an investment property or second home, your loan will fund on the same day.
Why do you have to sign so many documents?
As the last step in the mortgage process, closing is also referred to as a settlement where you and all the other parties sign off on all loan transactions.
How does it work?
While the process varies state by state, typically a professional (attorney or closing agent) will explain every document—letting you know where to sign.
Now that you know exactly what to expect, you’re all set to have a smooth, fast closing process. We hope you have your keys in hand soon!