Closing Documents: What Should a Home Buyer Expect to Sign?

Whether you are a first-time buyer or simply need a refresher, knowing what you may anticipate to sign at the closing is beneficial.

What you will discover:

Loan Estimate and Closing Disclosure for Promissory Notes
Loan Application Escrow Statement Mortgage, Security Instrument, or Deed of Trust
Certificate of Compliance
How to Use Electronic Signatures to Make Your Closing Run Smoothly
Ensure a smooth closing on your home purchase.

Purchasing a house can be both an exciting and daunting process. To finalize the purchase of your new house, you will be asked to sign a number of paperwork. Whether you are a first-time buyer or simply need a refresher, knowing what you may anticipate to sign at the closing is beneficial. There are no two house transactions alike, and you may be required to sign more agreements, but these are the most typical.

Note of Promissory

If you financed your house, you will be required to sign a Promissory Note, which will be provided by your lender. The Promissory Note indicates your agreement to repay the mortgage loan and often contains the following provisions:

The amount of the mortgage interest rate imposed on the loan
The monthly mortgage payment amount
The deadline
Where should the money be sent?

Closing Disclosure and Loan Estimate

The Good Faith Estimate (GFE) and Truth in Lending (TIL) were previously extensively utilized papers before to and at closing. However, as a result of changes in federal law, they have been essentially superseded by two new documents: the Loan Estimate and Closing Disclosure.

The Loan Estimate is supplied early in the process and should include crucial loan facts such as the amount borrowed, loan terms, interest rate, and projected closing expenses. You should receive the Closing Disclosure at least three days before the closing. It includes the same information as the Loan Estimate, as well as any revisions, so you may compare the information on the Disclosure to the information on the Estimate.

Mortgage, security instrument, or trust deed

Whether you sign a “Mortgage,” “Security Instrument,” or “Deed of Trust” depends on the state in which you acquire the property. In the case of a loan failure, a mortgage or security instrument guarantees the lender’s legal rights to the property. A Deed of Trust establishes a trust account that keeps the property deed until the debt is paid in full. This also safeguards the lender’s property rights.

Loan Request Form

When you first applied for the loan, you likely filled out a Loan Application form. However, you will very certainly be required to sign a copy of that application at the closing. The lender wants to make sure your financial situation has not altered since you applied for the loan. If anything has changed, such as a job loss, the lender wants you to notify them before signing the contract.

Escrow Declaration

This document details any payments made by the lender throughout the first year of your loan. This usually includes taxes and insurance.

Certificate of Compliance

If you are acquiring a new house, you will need a Certificate of Occupancy before you can legally move in. Following an inspection, the local authority (city or county) will provide this document.

How to Use Electronic Signatures to Make Your Closing Run Smoothly

If you are buying a house, it will most likely be the most expensive—and important—purchase of your life. It might be difficult to navigate the closing procedure. If you have any legal issues regarding acquiring a property, including the closing procedure, you should consult with an attorney.