Take Your Time
There are many documents involved in a real estate closing. Many are required by the lender, and some are required by state and federal law. Regardless of who requires a document, you have the right to take your time and review them all. Make sure the information on the closing documents is exactly what you're expecting.
- If things look different than what you were told or than what your earlier paperwork said, ask questions.
- Don’t sign anything until you’re fully satisfied that the paperwork matches your expectations.
Sometimes things change a little bit in the last few days before closing
For example, if the seller hasn’t fixed something they agreed to fix, there may be a change.
- The seller may give you money to put towards your closing costs (known as seller credits) instead of trying to make the repair before closing.
Don't be afraid to ask lots of questions
A mortgage loan is a big financial commitment, and you have a right to understand what you're signing up for. Don't sign a document until you're comfortable with what it says.
- If the problem or confusion is about the terms and conditions of the sale, ask your real estate agent or settlement agent (title company, escrow officer, or attorney).
- If the problem or confusion is about your loan, you’ll need to talk to your lender.
- If the answers you get don’t add up, don’t be afraid to stop the closing. This is the most important moment in the transaction.
You are not committed until you have signed the closing documents
You can always walk away at closing if you are not comfortable with the transaction. You may lose any deposit that you gave the seller, and there may be other consequences from breaking your purchase contract. You may also lose any application or appraisal fees you gave the lender. Know what your contract says and what your choices are before you walk into the closing.
If there are significant differences between the paperwork you reviewed in advance, and the paperwork you see at the closing table, don’t sign anything until you are comfortable with the transaction.
Don’t be afraid to slow things down
Ask questions. The best time to fix things is before all the documents are signed. Once everything is signed, if you discover anything that isn’t what you expected, you might have to hire an attorney to try to resolve the issue.
Don't ever sign blank documents or documents that say something different from the transaction you've agreed to
If the papers don’t reflect what you were told about the loan, that is a big danger sign.
Save and file your documents
Your mortgage is a big financial commitment. Keep your documents so you can refer to them as needed.
Save all of your final loan and purchase documents in a safe place
Save the whole stack or electronic file. Double-check to make sure you have these four key documents:
- Closing Disclosure
- Promissory Note
- Mortgage (also known as the Security Instrument or Deed of Trust)
Your Closing Disclosure can help you with your finances in the future
- Your Closing Disclosure can help you save money at tax time. Some of the closing costs you paid may be tax-deductible. You’ll need your Closing Disclosure to complete your tax return accurately.
- When it comes time to consider refinancing your home or moving to a new home, your Closing Disclosure reminds you of the types of costs you can expect.
- Your Closing Disclosure may also be helpful for tax purposes when you sell your home.