What happens on the day of closing?

On the day of closing, you and the seller will go to your attorneys’ offices to complete the paperwork process. You will sign closing statements (or settlement statements) and mortgage documents. Make sure you have read or read that day all of the documents you are signing. There will be many different forms you have to sign. Your REALTOR^® will be there to help you. Some of the documents include the following:

• HUD-1 Settlement Sheet itemizes the services provided to you and the fees charged to you. You can review this document one day before the closing if the information has been provided to the real estate attorney.

• Truth in Lending statement gives the terms and costs of your mortgage loan, including loan amount, the interest rate, the total amount of money you will have to pay over the life of the loan, the amount of interest you will have to pay in advance (points) and the annual percentage rate (APR). APR is the actual interest rate you pay when you have the points and interest paid monthly.

• Bank note, which describes how much you owe the bank at the agreed upon interest rate, how it will be repaid and what should happen if you miss a payment.

• Deed of trust, which is a legal document in which the borrower conveys the title to a 3rd party (trustee) to hold as security for the lender. When the loan is paid in full, the trustee will provide the deed to the borrower. If the borrower defaults on the loan, the trustee will sell the property and pay the lender the mortgage debt.

After the closing, once the paperwork is signed, the money is transferred and the seller receives his or her check, the keys will be given to the new homeowner. There may be delays due to transferring of paperwork between the seller’s attorney and buyer’s attorney or the lender.