How to Prepare for the Closing Process

by Lori Vernon Gagetta 03/15/2020

Image by mohamed Hassan from Pixabay

The last step of any home sale is the closing. This is the time when the buyer and seller sign all the documents surrounding the sale, including the documents for the buyer’s mortgage. This is when money changes hands and, in most cases, the buyer gets the keys to the home. If you’ve never attended a closing before, or it’s been a while, here’s what you can expect.

Before the Closing

Before the closing takes place, the buyer and seller will meet at the property for a final walkthrough. This gives the buyer the chance to inspect the home to make sure nothing changed in its condition between the inspection and the closing date. Buyers will look for damage to the property or items that aren’t working properly.

Who Attends the Closing

The closing is the next step. Both the buyer and seller with their respective real estate agents will be there. If anyone used a real estate attorney, that attorney will attend. A closing agent will conduct the meeting, and the lender may send a representative. Finally, someone from the title company will be in attendance.

Presenting & Signing the Documents

The main task that takes place at closing is the signing of documents. The buyers will go through about 50 to 100 pages of documents, many of which require a signature. Many of the documents are related to the buyer’s mortgage. The buyer will need to show proof of insurance, pay the closing costs, which are typically 2 to 5 percent of the home’s value, and fund the escrow, unless the seller offered to cover closing costs. Some of the documents relating to the mortgage that the buyer will need to sign include:

  • Final loan application

  • Mortgage agreement

  • Mortgage note

  • Loan estimate and closing disclosure

  • In addition to the mortgage documents, both the seller and buyer will need to sign several things, including:

  • The property’s deed

  • Bill of sale

  • Transfer tax declarations

  • At this point, any necessary payments are made, and the closing agent will write checks for the real estate agents' commissions. As long as there are no delays for funding, the keys change hands and the buyer becomes the home’s new owner.

    Potential Problems at Closing

    Most closings happen without any issues, but there are some problems that can arise on that day. It’s on the closing day that the final approval of the mortgage takes place. If the lender finds something surprising, like a change in employment or credit history, they could deny the loan. Also, title problems can pop up at closing that went undetected during negotiations. Finally, problems found during the final walkthrough could lead to delays at closing.

    Being well prepared for closing can help both buyers and sellers avoid these types of problems. With the right knowledge ahead of time, you can walk into closing confidently, knowing your real estate transaction will be completed in just a few hours.

    About the Author
    Author

    Lori Vernon Gagetta

    After attending the University of Iowa, Lori traveled extensively with her positions in the travel industry before calling the Napa Valley home. For the past twenty years, Lori has earned a reputation for her organizational skills, honesty and integrity in the community as Manager of a local Travel Agency, as Director of Operations for Francis Coppola and as Director of Operations for a highly successful executive placement firm. 

    These diverse positions have enabled Lori to explore the many different aspects of business from a small, local yet competitive company to the worldwide exposure of marketing international resorts, property management and the high tech industry of Silicon Valley.

    As a member of the North Bay Association of Realtors, Napa Chapter, the National Association of Realtors, the California Association of Realtors and the Bay Area Real Estate Information Services, Coldwell Banker Previews International, Lori brings her attention to detail and her dedication to customer to Real Estate. Joining Coldwell Banker, Brokers of the Valley in August 2001, has afforded Lori the opportunity to experience all aspects of the residential real estate market. From the first time home-buyer, to the acquisition and marketing of vineyard land, ranch or estate property, Lori offers a progressive, informative and professional approach. 

    This dedication and commitment has earned Lori a position in the President's Elite, the top 1% of all Coldwell Banker International Sales Agents.