The Closing

By
Mortgage and Lending with George Souto NMLS #65149 FHA, CHFA, VA Mortgages NMLS #65149

As I stated in the closing of my last blog on in this series Meeting Conditions On The Commitment Letter  once the Attorney and the Buyers have completed all of the conditions that were listed on the Commitment Letter, the Closing Department will give the Attorney a "Clear To Close".  These are the words that everyone has been waiting to hear during this whole process.  The words that were needed for The Big Day to happen, The Closing.   Now a firm Closing Date that has been agreed to by all parties can finally be set.

Many times The Closing date is different from the date that was initially written in the Sales Contract. There could be various reasons for this.  The Buyer or Seller might wish to close earlier, or the Seller isn't ready to move yet, another reason would be if the Buyer had trouble meeting the conditions on the Commitment Letter and needed more time.  If issues arise between the time the loan is approved and The Closing, I make sure that I stay in touch with the Borrower, Closing Department, and Attorney, until the issues are resolved.  Keeping everything moving, and making sure everyone is doing what they need to be doing is essential if The Closing is going to happen within the date that was set in the Sales Contract.

On the day of The Closing everything is set, the Buyer has met all the conditions, the Attorney has prepared all of the necessary documents, and the Sellers have moved out of the house.  I try to be at my Closings, but as I have taken on more management responsibilities that has become more difficult.  However, I make sure that my Borrower knows that I will be available by phone and e-mail should they need me to answer any question that might come up during The Closing.  On the day of The Closing, but prior to The Closing a couple of things need to done:

  • Wire The Money - The Closing Department will wire the necessary funds to the Attorney's Escrow Account, so the the Attorney can cut all of the checks that will be needed at The Closing.
  • Walk-Through - Sometimes this is done on the day before The Closing but most of the time it is done on the same day before the Buyers come to The Closing. The "Walk-Through" involves the Buyers and their Realtor taking a physical walk through the property and inspecting it to make sure that everything is as they expected it to be. If it is great, if it isn't then those things will be discussed at The Closing and an agreement on how to remedy the situation will have to be reached before the transaction can be finalized.

Signing Documents - Generally the Buyers and their Realtor head to the Attorney's office for The Closing after they have done the Walk-Through.  Once they have arrived the signing begins, usually the Buyers are very nervous, but very excited as well. This is most likely the most money that they have ever committed themselves to, and there is usually a very nervous excitement in the air. All documents are explained by the Attorney, and on occasion by me, especially if it is a Connecticut Housing Finance Authority (CHFA) Mortgage.  As I stated before I try to attend my Closings, because it does seem to put the Borrowers more at ease.  Some of the more important documents that the Buyers will sign are: 

  • Settlement Statement (HUD-1) - The HUD-1 is basically a financial statement which contains all the costs and credits that both Buyer and Seller will incur or receive on the day of the Closing. For me this is the most important document that both Buyer and Seller will sign on the day of the Closing. I tell my Borrowers that it is very important that they look at every figure carefully and make sure that it is what they expected, if it isn't, they need to ask question until they are satisfied with the answers. Here in Connecticut the Buyer and Seller will sign 6 - 7 original copies of the HUD-1 depending on the Attorney.
  • Truth-In-Lending - They will also sign a new Truth-In-Lending, that has been adjusted to reflect the actual costs which were not known at the time they signed the original one with the Application.
  • The Mortgage - This document is the legal device that is used to secure the property. It pledges the title to the property as security for the Loan. This document is several pages long, and will stipulate what the obligations of the Buyers are, and what will happen if they default on the Loan.
  • The Note - Is the written promise to repay the amount borrowed to the holder of the Note along with interest. It will state the amount of the debt and the interest rate. Once the Buyer signs this document they are personally responsible to repay the amount stated on the Note. The Note contains a lot of the same terms and conditions that were also stated in "The Mortgage". They are so similar that many times Buyers think that they are signing the same thing, but it is different and carries different obligations.

Here in Connecticut the Sellers also attend the same Closing as the Buyers.  So as the Buyers are just about completing the signing of the above documents and others, the Sellers, their Attorney, and usually their Realtor arrive.  The Sellers will sign the HUD-1's along with other documents that pertain to them.  Once everything has been signed by the Buyers and Sellers their only remains three things to happen.  Besides making a phone call to my Borrowers to let them know that their loan has been approved, this is my favorite part of the process.  No matter how stressful it was during this process, it does not matter at this point.  Everyone has great big smiles on their face, and looking forward to the new chapter in their lives, a chapter that I plan to be a part of with my Borrowers.  As I said only three things remain to be done at this point.

  • Checks- The Attorney distributes the check to the Sellers, and the two Realtors if they are present.
  • Keys - The Buyers receive the much awaited "Keys", and are now the proud owners of the house of their dreams.
  • Recording The Deed - Even though everything has been signed and keys have been given to the Buyers, one more thing still remains to be done.  The Attorney now needs to formally record the new Deed onto the Land Records, at the Town Clerks Office.

The Closing might be over, but it is not the end of my involvement with my Borrowers, in fact in many ways it is the start of a new beginning.  A beginning of being their for them as long as they have this mortgage, and keeping them informed of options that may come along during that time.  I will cover my involvement with my Borrowers during the Post Closing years in my next and final blog in this series

 

Other Blogs In This Series:

Preparing Buyers To Purchase A Home

Obtaining A Mortgage

Meeting Conditions On Commitment Letter

The Post Closing Years

 

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Who To Call For Your Mortgage Needs In Connecticut:

George Souto NMLS# 65149 is a Loan Officer who can assist you with all your FHA, CHFA, and Conventional mortgage needs in Connecticut. George resides in Middlesex County which includes Middletown, Middlefield, Durham, Cromwell, Portland, Higganum, Haddam, East Haddam, Chester, Deep River, and Essex. George can be contacted at (860) 573-1308  gsouto@mccuemortgage.com, or visit my McCue Mortgage Homepage.

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 Info about the author:

George Souto NMLS# 65149 is a Loan Originator who can assist you with all your #FHA, #CHFA, and #Conventional #mortgage needs in Connecticut. George resides in Middlesex County which includes #Middletown, #Old Saybrook, #Middlefield, #Durham, #Cromwell, #Portland, #Higganum, #Haddam, #East Haddam, #Moodus, #Chester, #Deep River, and #Essex. George can be contacted at (860) 573-1308 or souto@snet.net

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Esko Kiuru 08/24/2012 10:54 AM
Topic:
Mortgage / Finance
Location:
Connecticut
Groups:
Realtors®
Mortgages
1st Time Buyers
Real Estate Rookie
ActiveRain Contests
Tags:
the big day

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Rainmaker
1,267,143
Al & Peggy Cunningham, Brokers
RE/MAX West Realty Inc., Brokerage - Brampton, ON
Our Family Wants To Help Your Family!
This has been such an informative series George. You're right George clear to close is what we are all waiting to hear!
Jul 31, 2012 11:29 AM #1
Ambassador
1,041,120
Andrea Swiedler
Berkshire Hathaway HomeServices New England Properties - New Milford, CT
Realtor, Southern Litchfield County CT

George, ah yes, music to my ears, "clear to close". And I am here to say that you are one of the most thorough mortgage professionals I have ever worked with. There was never a time my buyers, or myself for that matter, were uninformed during the process. You are a true professional. And your reprutation preceeds you, I can tell you that. I mentioned your name to our inhouse mortgage guy who said he had heard you were one of the best.

What a great series, I will just have to reblog these.... :D

Jul 31, 2012 11:33 AM #2
Rainmaker
1,317,376
Joan Whitebook
BHG The Masiello Group - Nashua, NH
Consumer Focused Real Estate Services

George -- YES.. These are my favorite 3 words in business "CLEAR TO CLOSE"!  I start doing a happy dance. 

Jul 31, 2012 12:15 PM #3
Ambassador
3,684,462
George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Al and Peggy glad that you have enjoyed this series so far.

Andrea thank you that means a lot coming from you.  It was a pleasure to work with you as well, you made the whole process very easy.

Joan, OK I want to see a video of that happy dance :) :) :)

Jul 31, 2012 12:45 PM #4
Rainmaker
4,429,923
Gita Bantwal
RE/MAX Centre Realtors - Warwick, PA
REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel

Thanks for the series of posts. I will share it with others. All Realtors love the words, ' Clear to close.'

Jul 31, 2012 09:11 PM #5
Rainmaker
1,036,018
Bill Gassett
RE/MAX Executive Realty - Hopkinton, MA
Metrowest Massachusetts Real Estate

George you are right about those magic words being we have clear to close - I love it:)

Jul 31, 2012 09:38 PM #6
Rainmaker
1,301,716
Nick T Pappas
Assoc. Broker/Broker ABR, CRS, SFR, e-Pro, @Homes Realty Group, @HomesBirmingham & Providence Property Mgmnt, LLC Hun... - Huntsville, AL
Madison & Huntsville Alabama Real Estate Resource
George, what great information for your clients to read...knowing what to expect really eases the stress especially to first time buyers. Just as a side note...the buyer and seller meet at the closing table here....that can change, but it's typical for everyone to be at the table.
Aug 01, 2012 12:09 PM #7
Rainmaker
325,771
Esko Kiuru
Bethesda, MD

George,

Especially first time buyers will benefit from reading this, to put them at ease as to what all is going on in the big closing event.

Aug 24, 2012 10:50 AM #8
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