It can be a whirlwind 30 days from the moment the sellers accepted your offer and signed the sales contract to the final settlement. Once the contract is executed by both parties, it all begins. You’ve already provided your lender with your paperwork needed to get your preapproval letter, so now it’s time for various third parties to get involved. Most of these third parties you’ll never interact with. The only connection will be to pay for your share of closing costs at the settlement table.
As you get closer to your closing date, your lender will ask for any items in your loan application that need updating. Credit documents within a loan file need to be no older than 30 days. If your first paycheck stubs were submitted two months ago, you’ll need your most recent one. Same with any credit document in the file, such as bank statements. When your lender contacts you needing more information, do not be alarmed. They are typically just making sure your loan package meets lender guidelines. Your part is to get the information to the lender as quickly as possible once asked for. Otherwise, you’re holding up your own loan approval.
Your settlement agent will prepare and present a copy of your final settlement statement, sometimes referred to as a closing statement. This will list all charges for both the buyer and seller. You will use this statement to compare what the lender originally quoted in the final amount. The statement will show your earnest money deposit and be listed as a credit to you. The statement will also reflect your down payment and the final loan amount.
The settlement agent will provide you with a list of times available for you to sign your closing papers. Once your appointment is set, it’s time to head to your closing. You won’t see the sellers there, it’s just your turn. Sometimes sellers are present but that doesn’t happen very often. You’ll notice a stack of documents in front of you. Each will need either your signature or your initials. You’ll also notice some of the documents are those you’ve already signed and provided to your lender. Final loan documents need a 'wet' or a 'live' signature and not a copy from a previous document.
You can prepare a cashier’s check for the final amount needed or you can have your bank wire the funds directly to the settlement agent. This is the preferred method for most closing agencies and also the most convenient for you. But it’s always your choice. Once all your documents are signed and funds delivered, the settlement agent sends the signed documents back to the lender for final approval. You probably already have the keys to your new house at this point, but your loan still isn’t final. The lender needs to make certain the settlement agent followed the lender’s instructions to the letter. Once that determination is made, funds are released, and you own your home!
Remember, we are here to help you. If you have any questions whatsoever about the loan process, whether this is your first purchase, you're looking to refinance, get cash out, you're a vet, an investor or just need to have someone take you by the hand, we got you covered! Click here to contact a Loan Originator near you.