What is the Process for Closing on a Home?


If you’ve never purchased a home before, the closing process may seem complicated and overwhelming. Don’t worry, though, because we at Smith Douglas Homes are here to help you every step of the way.


The closing process used to be a highly-detailed event that included a plethora of legal documents, but most of today’s closings are heavily-automated. Much of the work is done prior to the actual closing date, so you can spend your closing day celebrating your new home. Read on to learn more about the process of closing on a home.


Preparing for Your Home Closing


Prepare in the days ahead of your scheduled closing so that you have everything you could possibly need on-hand and ready to go. Gather all of the documents that you’ve accumulated across the home search and buying process. Your paperwork should include: the good faith estimate from your lender, the contract, insurance paperwork, appraisal reports, inspection reports and the proof of title.


On the day you close on your home, you’ll be required to sign the papers to “seal the deal”. Once you sign the paperwork, you’ll be a homeowner! Don’t walk into the home closing empty handed, though. You’ll need your driver’s license and any money that is owed at closing.


Most of the time, funds due on the day of closing will be sent by a wire from your bank, so check with your lender on the specifics. If you owe money on the day of closing, it most likely will be required to be certified funds or a wire sent directly to the closing attorney’s office. Check with your lender and closing attorney to confirm how they’ll handle this.


The Walk-Through


If you’re purchasing a used home, most home sale contracts urge you to walk-through the property in the 24 hours that precede the closing. This is an opportunity to give the home and the yard one last look to verify that everything looks as it should. If the home is not in the condition that is described within the sales contract, raise the issue and seek a remedy.


When you purchase a new home, you will have a walk-through 7 days prior to your closing. You can use this time to point out any cosmetic items that may need repair. You’ll then have a final walk-through 24 hours prior to your closing, or sometimes the day of closing, to confirm that all of your requested repairs have been made.


Your Signature is Required


Your closing day requires the signing of numerous legal documents. The most important among these is the agreement between you and your lender that lays out the mortgage’s terms and conditions. You will also put your signature on the agreement between you and the property seller that transfers the ownership of the property into your name.


Paying Closing Costs


There are many different costs that can be associated with closing on a home. These costs vary for each home sale, and can be split between the buyer and the seller depending on the specific situation. Generally, closing costs are between 2-5% of the purchase price of a home.


Here are a few examples of the types of costs you may encounter during your closing:


  • Appraisal fee
  • Fee for running your credit report
  • Attorney’s fees
  • Title insurance and title search fees
  • Survey fee
  • Discount points
  • Inspection fees
  • Recording fee
  • Underwriting fee
  • Loan origination fee
  • HOA initiation fee*
  • Pro-rated property taxes
  • Mortgage insurance premium


*Most communities require the initiation fee + the annual fee on the day of closing.


Once you’ve conducted the walk-through of your new home, reviewed all pertinent legal documents and applied your signature, the home closing process will be officially finalized. At this point, you will receive the house keys and begin celebrating the purchase of your new home!


Let Smith Douglas Homes be a Part of Your Home Buying Team


Are you ready to begin searching for your next home? Whether you’re a first-time home buyer or looking to downsize, we’re ready to help you find the right space for your needs. Our New Home Specialists are available to answer any questions you may have from the initial phone call all the way through the final signature on closing day. Contact us today to get started on your home search.


Image courtesy of: Shutterstock