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Signing Important Documents: What to expect at the Closing Table.

The day you’ve been waiting for is almost here! You will soon be a homeowner. But, you might be a little nervous about what to expect on the day you sign all of the important papers and receive the keys to your new home.

 

Here is a look at some of the documents you will be asked to sign at loan closing.

  1. The Promissory Note. This legal document is your agreement to repay your mortgage. The document contains details about the loan, such as the loan amount, interest rate, mortgage payment due dates, and how long repayment will take. Borrowers should read this document carefully and compare the details with the Closing Disclosure document that the lender provided within three business days prior to the loan closing.

  1. Mortgage, Security Instrument or Deed of Trust. (This document may be called any one of the three names, depending on the laws in the state where you are buying a home.) This document explains a borrower’s rights and responsibilities. When a borrower signs this document, he or she is agreeing that a lender has the right to foreclose, if the borrower does not repay or violates other terms of the mortgage loan.

  1. Initial Escrow Disclosure. This document shows the breakdown of monthly payments, and reflects the charges a borrower is agreeing to pay each month for principal and interest on the loan, as well as money set aside to pay property taxes and homeowners insurance. (Rules for how escrow accounts work may vary depending on the state you live in; ask questions at loan closing if you are unsure about your state’s rules.)

  1. Deed. This document transfers ownership of the property from the previous owner to the home buyer. It contains the names of the old owners and new owners, and includes a description of the property. The previous owner signs this document. You, as the new owner, should carefully read this document and ask any questions you have at the loan closing.


As already mentioned, real estate transactions are subject to the state and local laws. Your experience at loan closing may include more than the basic information included in this article.
 

Any questions or concerns about your unique circumstances can be answered by the settlement agent or attorney who is conducting the loan closing. These settlement professionals are impartial third parties who overseeing the final details of a real estate transaction.


- By Lauren Howey, Feb 01, 2016



 
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