You’ve almost made it through the entire mortgage process, meaning you’ve completed the pre-approval process, your offer was accepted on a home, and the house passed the home inspection. The only thing standing between you and your dream home is the closing.
So, what exactly is a closing? It’s essentially a meeting involving all appropriate parties to sign the final documents and transfer property ownership.
While each closing differs, based on the state in which you are purchasing your home, the parties generally present in Nebraska include:
- Buyer’s real estate agent
- Escrow closer from the title company
During the meeting, the loan documents are presented. These documents include the promissory note, security instrument, and multiple affidavits and declarations. When the buyer signs the promissory note, it indicates they have accepted the terms of the mortgage from the lender, and intend to pay back the amount of the loan plus interest incurred. The security instrument pledges their home as collateral if the loan is not repaid, basically acting as a form of insurance that the lender will get their money back. The affidavits and declarations are legally-binding documents that spell out the buyer’s financial obligation and their rights as a homeowner.
Next, the transfer documents are presented. These documents actually allow for the transfer of money to all those involved. It is important to note that prior to the actual closing, all of the money is transferred to the title company where it is held until all the appropriate documents are signed. Once signed, the money is dispersed to everyone involved, including the appraiser, seller, and real estate agents. Upon receipt of the money, the seller signs the deed of the property over to the buyer, legally transferring the property ownership.
During the entire closing process, the escrow closer prepares documents and ensures they are recorded properly after the closing day.
The real estate agents and lenders are there in the buyer’s best interest. They will help to field any questions that may arise, but it is always best to ask questions before the closing day.
As you can see, there are multiple parties involved in the closing process and many documents to be signed. It is important that every party takes the time to read and understand the documents they are signing prior to doing so.
Talking to your mortgage professional about the documents you will be asked to sign before closing day is always a good idea. Any qualified mortgage professional will be able to tell you exactly what each document means in terms that non-industry people can understand.
If you have any questions regarding the mortgage process, please feel free to reach out to us at Mortgage Specialists. We want to make the mortgage process as easy as possible for you and your family.