Closing the Purchase of Your First Home

keys70A first time homebuyer closing should be a celebration

After all the looking, the offer, the contract, inspections, getting a mortgage, finally you are going to close on your first home. What happens at closing? It can seem very daunting especially to the first time home buyer.  However, if the closing has been properly prepared, you will sign a number of documents and celebrate the purchase of your first home.

 Closing can occur anywhere, but it normally happens at the closing attorney’s office.  There the sellers and  the first time homebuyers will sit at a large table with the closing attorney who will review the final paperwork to complete the sale.  You will sign multiple copies of the the HUD statement.  This form is two pages long and documents the exchange of ALL the money involved in the transaction, from where the money comes from to where it goes. You will sign at least 6 copies so that you, the seller, both real estate brokers, the attorney’s office and the lender all have originally signed copies of this statement.

You will also sign the loan documents for your mortgage, starting with the note that says you will pay back the loan, how much the loan is and the interest rate.  You will also see the payment schedule and the escrow amounts that are collected each month to pay for your property taxes and homeowners insurance.   The Truth In Lending form will also show the final amount you will have paid at the end of the term of the loan – that can be a scary looking number!  After the attorney reviews all the paperwork with you and you sign everything, you will give the attorney the certified check that you brought to pay your down payment and closing costs.  The closing attorney will give you copies of all the documents.

When everything is signed and all the lender requirements are satisfied, your lender will wire the money to the attorney for your mortgage.  So, the money from your check and from your lender funds the sale, and  the attorney’s office will be in charge of dibursing all funds associated with the transaction.  Most of the time you will receive the keys to your new home, so you walk out of the closing with the keys to your first home. However, the home is not technically yours until the deed has been recorded at the courthouse, so some sellers, such as relocation companies and banks,  will not let you have the keys untill after confirmation of the recording. The attorney’s office sends someone to the courthouse to record deeds one or more times a day to do a final check on the title and record the documents.  One reason that you will want to close earlier rather than later in the day is that you need time for the loan to fund and for the documents to be recorded.  In North Carolina, the recorder’s office  closes at 5:00 pm and they wait for no one, so you must have completed all of your paperwork and have time to get recorded before closing time.  In Wake County, the Registrar/Recorder has started a new program where you can record documents electronically, so that recording is easier and there are no delays for driving and traffic.

Once you complete this step, you are now a homeowner.   Congratulations!

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