Prepare for Closing
The mortgage process can seem very complicated. However, your loan officer, lender, mortgage professional, etc., should be able to hold your hand throughout the entire mortgage process. Typically, the loan officer you will be dealing with will have a tremendous amount of experience, knows the mortgage industry, and stays abreast of any changes, industry news, and most importantly, interest rates. If you have questions, do not hesitate to call them and begin asking for help. They are there to ensure your loan is processed, underwritten, and sent off to the closing as smoothly as possible.
It’s to your best interests that you provide honest and accurate information to your mortgage officer. This means that you should not overstate your income, assets, length of current employment, etc. You should also accurately report your debts and not supply any misleading documents that would state otherwise. The loan/mortgage product that you obtain is going to be suggested by your loan officer and in order to get you the best mortgage product for your specific situation, it’s always best to be honest with your lending institution.
The Day of Closing
When you submitted your offer to purchase agreement and everyone signed, it became a ratified contract to purchase the home. In this contract, you set a closing date with your agent, the seller, and any other representative or party tied to the contract. The closing date should have allowed for enough time to obtain your mortgage. In some cases, if the property is not up to par with the lenders requirements, they may require repairs to be completed on the property before closing can occur or before your lender will loan you the mortgage.
The Good Faith Estimate
What exactly is a good-faith estimate? The good-faith estimate is an itemized list, reporting the closing costs associated with your transaction. It lists all closing costs paid outside of closing, such as the appraisal fee, any loan application fees, credit report fees, and any other miscellaneous fees. Also included in the good-faith estimate are your closing costs and escrow costs for things like city taxes. You will receive the good-faith estimate from your mortgage institution after loan application and before reviewing the final HUD-1 settlement statement. Generally, there are closing costs that are standard and they are listed below for quick reference.
Closing and Escrow Costs
- Any loan origination fees
- Credit check/report fees
- Appraisal fees
- Loan discount points (if charged by your lending institution)
- Title search and title insurance fees
- Title company or attorney providing closing services
- Recording fees
- Survey fees
- Home owners insurance
- Mortgage insurance premiums
- Interest due on the loan prorated from date of closing through end of month
- Property taxes