What happens at closing: documents, walk-through, funds

Before closing day

Review the Closing Disclosure. By law you must receive it three business days before closing (CFPB). Compare it with your latest Loan Estimate: loan amount, rate, monthly payment, closing costs and cash to close. See the Closing Disclosure guide.

Ask for the main documents ahead of time. The CFPB suggests asking for the Promissory Note, the Mortgage and the Deed in advance, along with the Closing Disclosure, and asking how you will receive them (email, mail or download).

Do the final walk-through. The CFPB says to do it “before you sign any papers.” Confirm that agreed repairs were made and that items the seller agreed to leave are in place. If not, “contact the seller right away.” A seller credit may replace a repair the seller agreed to make, giving you money toward closing costs instead.

Keep the loan on schedule. Delays in sending your lender documents can push back closing, and “a delayed closing can be costly: your rate lock could expire.” If your contract sets a deadline, a delay could put the home and your deposit at risk. See mortgage rate lock.

Who you deal with

The CFPB names two sources of answers. Questions about the sale terms go to your real estate agent or the settlement agent, who may be a title company, an escrow officer or an attorney. Questions about your loan go to your lender. Who runs the closing depends on your state: see whether an attorney is required.

The documents you sign

The CFPB says there are “many documents involved in a real estate closing.” Some are required by the lender and others by state and federal law. The four the CFPB tells you to keep afterward are:

On the security interest, the CFPB says you grant it when you sign your closing forms, and it is what lets the lender foreclose if you do not pay back the money. “Don’t ever sign blank documents or documents that say something different from the transaction you’ve agreed to.” You have the right to review every closing document. If you buy with another person, the CFPB suggests considering a real estate attorney to confirm the deed gives the ownership type you want.

Paying cash to close

Cash to close is the amount your Closing Disclosure says you pay at closing. Check that it matches your most recent Loan Estimate (CFPB). Your earnest money deposit may count toward it; see your contract. See closing costs explained and the closing costs calculator.

Beware of wire fraud. The CFPB warns that scammers may pose as your real estate or settlement agent and request last-minute changes to wiring instructions. Verify any change before sending funds, using a phone number you already trust. The CFPB publishes a separate warning on mortgage closing scams.

Keys and possession

The CFPB pages on closing do not say when you get the keys. That date comes from your sales contract and the settlement agent, so ask them at the table, and confirm it in writing before closing day.

After you sign

The CFPB says to keep the whole stack of four documents, or an electronic copy. The Closing Disclosure helps at tax time, since some closing costs may be tax-deductible, and when you refinance, move or sell. After closing, your deed and other mortgage information are filed as a public record: your name, lender, loan amount and address become public. Companies may use this for ads or scams. Mail bearing your lender’s name may not come from your lender.

Can you stop the closing?

Yes, before you sign. The CFPB says: “If the answers you get don’t add up, don’t be afraid to stop the closing.” You may lose your deposit and any application or appraisal fees paid to the lender.

Where states differ

Federal rules decide the disclosures and the three-day review. States decide who conducts the closing, the transfer taxes and recording fees, and customary practice. Compare your state’s closing costs, transfer tax and real estate attorney pages, and read title insurance explained and the escrow account. For the full sequence, see steps to buy a home.