The big day is finally here. You are one step away from owing your home! This last step is called the Mortgage closing process and this is one which every homeowner should be fully aware of. There are few preparation checklist points that can follow to ensure that all goes well with your mortgage application.
Understanding mortgage closing and its elements can save you last minute hassles. Mortgage closing also gives you the opportunity to make any final changes to the transaction as well as allowing inspection of the property before you sign the dotted line. Let’s take a look at a few things that need to be done during a mortgage settlement process.
Mortgage closing process – Important documents:
1. Paying the costs of closing: Once your mortgage has been approved, you are required to pay the down payment and some part of the closing cost. Usually this is included by homeowners as part of the principal of the loan borrowed or is foot by the seller in return for a higher rate of interest on the loan borrowed.
2. Escrow statement: The escrow statement consists of escrow payments that have to be made over the next 12 months. Escrow payments usually include property taxes and property insurance.
3. HUD-1 settlement: While your initial estimate of the mortgage might have been a particular number it is very important to know the exact cost. This is made possible by acquiring copy of a HUD-1 settlement statement. You can get your hands on this document a day before closing. This will give you time to review and correct items in the terms.
4. Title deed: The title deed is the most important legal document that describes the property in detail and is a document that entitles transfer of the property from one party to another. The title deed is usually governed by the laws in which the property is located
5. Mortgage note: The mortgage note is a lien against the property in question. It acts as insurance for the lender should the borrower default on the loan. The mortgage note also describes the borrower’s rights and obligations pertaining to the mortgage.
6. Occupancy certificate: The occupancy certificate is a legal document that entitles you to move into a new constructed house.
7. TILA statement: Usually mortgage loan borrowers get a version of this statement after the mortgage has been applied for. The final version contains the loan cost, the lending rate, changes in the rate of interest and any other modifications. It is important to review this document carefully to see if everything is in order.
8. Deed in trust: In this case, the borrower can transfer the title of the deed to a trustee until the entire borrowed amount is fully paid. This is used in lieu of the mortgage document. This enables the trustee to sell the property without legal ramifications in case the borrower defaults on the loan.
An efficient process of closing the mortgage can help ease the tediousness of acquiring a home. Contact Flatworld Solutions to know how we can help with your mortgage requirements.