Closing on your new home is a time to celebrate. It’s the last step of the homebuying journey where you finalize all the details and finally get the keys to your new home. But what exactly happens during closing? While the actual process may vary a bit, here’s a general idea of what you can expect when you close on your new home.
What is a Home Closing?
The closing (also called a settlement or completion) is the process of transferring ownership of a property from the seller (or builder) to the buyer. This is when documents and money are signed and transferred to complete the home purchase.
How Long Does Closing Take?
The closing process can take several weeks to navigate. The average time to close a loan was 48 days in July 2021. Why does it take so long? There’s a lot happening during this time including home inspections and final walkthroughs, appraisals, title review, and the review and approval of your mortgage application. While there isn’t anything you can do to speed up the closing process, here’s what you can do to keep your closing on schedule and avoid costly delays.
Who Attends Closing?
Closing requirements vary by state, and sometimes even county to county, but generally the closing agent, lender, title company representative, and the buyers will be present.
What Happens During Closing?
You will have two primary responsibilities during closing. First, you’ll sign a variety of legal documents that will outline the terms and conditions of your mortgage and transferring ownership from the seller to you, the buyer. Be sure to read everything carefully and ask for clarification before signing them. Second, you’ll pay closing costs and fees, including property taxes and utilities. These are usually paid with a certified or cashier’s check made out to the escrow company or a wire transfer directly to the banking institution.
There are three main documents you’ll sign:
- Mortgage or deed of trust: this places a lien on your home as collateral for your loan
- Promissory note: the written agreement that you’ll pay your mortgage
- Closing disclosure: the itemized list of the final loan terms and closing costs
Once everything’s done, you’ll finally get the keys to your new construction home as well as some important documents including the loan estimate, closing disclosure, initial escrow statement, mortgage note, deed of trust or mortgage, and a certificate of occupancy.
How to Prepare for Closing
Bring the following documents to your closing:
- Government-issued photo ID
- Copy of your purchase agreement/contract
- Proof of title and homeowners insurance
- Any bank documents required for your mortgage approval
- A certified check for closing costs
Closing marks the end of one journey and the beginning of a new one as homeowners. It take a lot of work to get to this point so be sure to celebrate when you receive the keys to your new Hayden home!
When you’re ready to buy a brand-new home in the Northwest, we’re ready to help. We have new home communities throughout Idaho, Oregon, or Washington and our team is ready to help you find the right home for your family. Contact us today.