Paperwork You Will Sign
On closing day, you will have a series of closing papers to sign. It is important that you review each of these documents with your real estate agent or attorney before signing.
- What is the Real Estate Settlement Procedures Act (RESPA)? -- A statement that acknowledges that you have been informed about how the closing process works, and that you fully understand all the closing documents and financial obligations related to the mortgage.
- What is the Truth in Lending Disclosure Statement (TIL)? -- The final statement that requires lenders to disclose all the actual terms and conditions of the loan. The final disclosure statement makes any corrections to the preliminary Truth in Lending Disclosure statement you received when you applied for the loan.
- What is the Mortgage Note? -- The buyer's commitment to repay the mortgage. The note stipulates terms for the loan including the loan amount, interest rate, address to send payments, maturity date for mortgage, frequency of payments, and the change dates for adjustable rate mortgages.
- What is the Security Instrument (Mortgage or "Deed of Trust")? -- A pledge of the property as security for the loan. The document stipulates the same basic debt information that is found in the note and is recorded.
- What is the Warranty Deed? -- The legal document that transfers the title from the seller to the buyer. The deed identifies the name of the seller as the grantor and the name of the buyer as the grantee.
Other Documents
Local laws and customs will determine whether or not other documents will be used in your closing process. Some contain information that by law you are required to receive. These documents may require your signature to verify that you have received, read, and understood the document. Below are some of the more common documents used.
- Loan Application - Confirmation that the information, such as your employment and marital status, that was given when you first applied for the loan has not changed.
- Escrow Analysis - Lender provides a detailed itemization of the escrow account used in servicing your loan.
- Tax Authorization - Gives permission to your local real estate taxing authority to send tax bills directly to your loan servicer so that payments may be made from loan's escrow account.
