When you finally reach the moment to close on your mortgage, you might wonder about the documents and steps involved, particularly if there's anything you'll need to resign. Let's walk through the closing process, focusing on whether you need to resign paperwork during this crucial stage.
What Happens at a Mortgage Closing?
At the mortgage closing, several activities and paperwork are processed to finalize your home purchase:
- Loan Documents: You’ll sign many documents related to your loan, including the promissory note, which outlines the loan terms, and the mortgage or deed of trust.
- Title Documents: These confirm ownership transfer and protect against any potential claims against the property.
- Disclosure Documents: This includes the final Truth-in-Lending Disclosure (TILA), Loan Estimate (LE), and Closing Disclosure (CD).
- Insurance Documentation: You might sign documents related to homeowner’s insurance, title insurance, flood insurance, etc.
- Settlement Statement: Known as the Closing Disclosure, it details all the costs you’ll pay and credits you’ll receive at closing.
Do You Resign Documents?
Typically, during the closing, you don’t resign paperwork, but you’ll sign numerous documents for the first time. Here’s what happens:
- Loan Documents: You sign these documents when you apply for the mortgage or during the loan process, but at closing, you’re signing final versions that reflect any last-minute changes or updated terms.
- Disclosures and Agreements: Items like the Closing Disclosure are not resigned but are reviewed and sometimes corrected, but you’re signing documents to finalize your agreement with the terms.
📢 Note: While you might not resign documents at closing, you will sign final documents, which might resemble documents you’ve seen earlier during the loan process.
Reasons for Resigning
While resigning documents at closing is unusual, here are scenarios where it might happen:
- Errors in Documentation: If there are significant errors found just before closing, you might resign corrected documents.
- Changes in Terms: If last-minute changes occur in the loan terms or if a new loan product is offered, you might resign documents reflecting these changes.
- Final Corrections: Sometimes, despite thorough vetting, a mistake can slip through, and you’ll need to resign a corrected document.
What to Expect During Closing
Here’s a closer look at what you might expect:
Documentation Review
Before signing, you’ll review all the documents. This includes:
- Verifying the accuracy of all personal and financial information.
- Ensuring the loan terms, interest rate, and payment schedule are as agreed upon.
- Checking the closing costs, prepaid items, and credits.
Signing the Documents
Once reviewed, you’ll start signing, which might involve:
- The promissory note and mortgage or deed of trust.
- Disclosure documents and any required state or federal disclosures.
- Various affidavits, agreements, and certifications.
Key Documents You’ll Sign
Here are some of the key documents you’ll be signing at closing:
| Document | Purpose |
|---|---|
| Promissory Note | Your promise to repay the loan, outlining the terms of repayment. |
| Mortgage or Deed of Trust | Legal document giving the lender the right to foreclose if you default on the loan. |
| Closing Disclosure | Final disclosure of loan terms, closing costs, and the transaction summary. |
| Truth-in-Lending Disclosure | Outlines the cost of your credit, including the APR, finance charge, and payment schedule. |
📝 Note: While it's uncommon, you might resign documents due to errors or last-minute changes. Always read carefully before signing.
In summary, you don't typically resign documents at the mortgage closing, but you'll sign final versions of documents that reflect any changes or updates to the loan terms or agreement. The closing is the culmination of your home buying journey, where you finalize everything and gain ownership of your new home.
What if I find errors on the closing documents?
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If you notice any errors or discrepancies, you should point them out immediately. The closing agent or your lender will need to correct these before proceeding with the signing process.
Can I back out of the deal during the closing?
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Technically, you can back out until you sign the final documents, but doing so might result in losing your earnest money deposit and could have other financial implications depending on the terms of your contract.
What happens after I sign the closing documents?
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Once all documents are signed, funds are disbursed, and the title company or closing attorney will record the new deed at the local records office, finalizing the ownership transfer.
Can I bring a real estate attorney to the closing?
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Yes, it’s often advisable to have an attorney review documents and oversee the closing, especially if you’re unfamiliar with the process or if the transaction is complex.
