There’s nothing more exciting than finding your dream home.
But before you can own it, there are certain things you need to do such as getting pre-approved for a mortgage, finding the right broker, hiring a reputable home inspector, and so on.
Of course, you also can’t forget about closing. It’s the final step before you can say that you’re the legal owner of your new home. That being said, if you have some questions about real estate closing documents, you’ve come to the right place.
Read on to know the different types of closing documents you have to prepare, plus tips on how to make the closing process as smooth as possible.
1. Closing Disclosure
The first item on your real estate closing documents checklist is the Closing Disclosure. This is a document required by federal law for all home sales, and it contains the terms and conditions of your mortgage loan.
Before closing, your lender must make sure you have read and reviewed this document. Note that lenders usually send the Closing Disclosure to buyers at least 3 business days prior to the closing date.
2. Proof of Homeowner’s Insurance
A day or two before closing, you need to provide your lender with proof of insurance on your new home.
It’s important you get in touch with your insurance agent a week before closing to make sure they get the insurance rider to your lender.
3. Your Loan Application
For the closing, your lender will provide you with a copy of your loan application, so you can check and sign it. If you’ve taken on any new debt, got a new job, etc., your lender has to know.
Especially for the first one, you have to keep in mind that a lot of delays in closing happen because buyers take on more credit, which changes their debt-to-income ratio. For lenders, this means they need to do recalculations and if necessary, hold back on mortgage approvals.
4. Other Real Estate Closing Documents
Aside from the ones already mentioned, there are several items you still need to complete your real estate documents list. These include the deed of trust or mortgage contract, title documents, affidavits, and so on.
For a tax declaration transfer, you may need to pay a fee. This is because most states impose a tax on property transfers.
Some Tips to Remember
Hiring a good agent can ensure that the closing process goes a lot faster. But if there are some snags along the way, it’s always worth it to hire a real estate attorney.
The truth is that even at the 11th hour, issues could arise. Having someone who can give you solid legal advice for negotiating terms can help put your mind at ease.
Paperwork Is Crucial to a Real Estate Closing
Now that you have some idea about some real estate closing documents you have to prepare, review, and sign, are you excited to buy your dream home?
If you still have tons of questions about the home buying process, don’t hesitate to check out our other posts.