So you have chosen you dream home, turned in all your paperwork to the loan officer, and your closing date is set.  You are nervous and excited because this is the last step before you get the keys to your new home.

You have understood all the processes that have taken you to this point, but now you have no clue what to expect at closing.  Closing is where you sign on the dotted line for the home as well as the mortgage. And the final transfer of keys and money. Closings typically take place at an attorneys office.

The following is a brief guide to get you through your big day and make all the legal and financial information sent your way, more understandable.

As you have heard, closings are a lot of signing, what you are signing is what I am about to explain.  When you close you are actually signing for two things: paperwork that has to do with your mortgage loan and paperwork that has to deal with real estate.

Here is a list of loan documents you will see at closing:

Truth in lending statement, also known as Regulation Z. The Truth in Lending statement details all the numbers and terms related to your loan.  It discloses your interest rate, annual percentage rate, amount financed and the total cost of the loan over its life. Make sure these numbers are in line with what the mortgage lender quoted you during you loan application process. One key term to look out for and ask is whether or not you have a pre-payment penalty. A pre-payment penalty is a fee they charge if you decide to pay off your loan early.  Ideally you do not want a prepayment penalty.

Itemization of amount financed. This document is like an addendum to the Truth in Lending statement. It summarizes the finance costs. It includes your amortization schedule.  The amortization schedule shows how debt is reduced over the life of the loan.

Monthly payment letter. This document reveals the break down of your monthly payment into principal, interest, taxes, insurance and any other monthly escrows. Again, look for any surprises. This should be in line with what the mortgage lender quoted you during your loan application.

Note. This is a very important document. The Note is where you’re actually borrowing the money – and giving your personal guarantee to pay it back.

Mortgage. This paper puts a lien on the house as security for the loan — allowing the bank to foreclose if you default on the note mentioned above.

Mortgage Application. You may have seen this document before, have no fear; they are just making you sign one in person as part of the closing package.

Here are the real estate documents that you will sign to make the house yours:

HUD Form 1 or Disclosure/Settlement Statement. Pay close attention to this form.  It states where all the monies exchanged in the transaction come from and go too. A good agent will work with you to make sure all your numbers are correct.  This is typically the first document the attorney presents to you.
Warranty deed. This is the document that includes the names of the buyer, the seller and a description of the property. The warranty deed also guarantees that the seller has the right to sell the property. With the signatures of the seller and buyer, this piece of paper transfers the title of property.

Name affidavit. This may seem like irrelevant, but this document certifies that you are who you say you are.  You may see several variations of your name; the names originate from your credit report.
Hand over the money, in some cases you have to bring money to the table.  The attorney who conducts the closing may require money to be wired or brought in certified funds.  All certified funds need to made out to yourself from yourself.  You should get an estimate of funds to close from your lender.

Now that you know what documents you expect to see at closing, relax, the house is nearly yours!  Feel free to ask any questions if you do not understand something.

Congratulations!