Review your Closing Disclosure
With the advent of the Consumer Financial Protection Bureau (CFPB), it is now a requirement that all Buyer’s Lender provide Buyers with a Closing Disclosure (CD) 3 days prior to the day of closing. The CD is a five page document that provides all the specific details of your mortgage loan. You’ll want to review the CD to make sure you are in agreement with what is shown according to what you were promised and anticipating. From such items as your purchase price, loan amount, monthly principal & interest rate, any prepayment penalties, estimated monthly payment and it’s calculation, estimated taxes/insurance/assessments, estimates for closing costs and money due at closing, and right down to the correct spelling of your name, you’ll be checking for it’s accuracy as now is the time to make any needed corrections that may appear.
Hopefully, the CD is accurate and you’ll be that much closer to being handed the keys to your new home. The least amount of aggravation at this point is always welcome news. If the CD is not accurate, please discuss with your Loan Officer to correct any errors before you head to closing. I know, the thought of having to correct errors at this point is never music to your ears, but nonetheless, it’s great to know there are some good checkpoints put it place, aren’t there?!
Keep in mind that any major changes to your CD that affect your financing, such as an incorrect loan amount will require that the CD be updated and a new 3 day waiting period would be begin before you’re able to close.
Review Settlement Statement
Just prior to closing which typically can be just a few days before closing or the day before closing, you’ll receive a settlement statement from the Closing Agent, that has been verified by your Lender, that details all the costs of your home purchase that include such items as your loan charges, insurance premiums, taxes, title & settlement charges, government recording & transfer charges, any homeowners association maintenance fees, if applicable, and any others charges that may apply. You will review this, in addition to your Realtor who should have reviewed for accuracy. Your Realtor’s knowledge should extend to examining a settlement statement.
This is the time to catch any errors that could be as simple as a name misspelled.
You want it correct before you get to the next step of knowing how much money you need to have for the day of closing.
Wire your Needed Funds or Cash to Close
Unfortunately, the issuance of fraudulent cashier’s checks from a bank has reached levels that now require that the vast majority of Real Estate closings must be settled with the wiring of funds from your bank to the settlement Closing Agent.
Once you have reviewed your closing disclosure and final settlement statement, as discussed above, you will know the exact dollar amount of what is needed to be wired. This will be the cash that you need after the loan proceeds have been applied to your home purchase and your escrow has been accounted for in the calculation.
You will be provided with the closing Agent’s wire instructions so you know exactly where you will be wiring money from your bank to the closing Agent’s bank. Once you complete this, your bank will provide you with a wire receipt indicating that your funds have been electronically transferred from you bank.
Now, you’re reminded that all of those months and years of saving to buy a home, has suddenly been depleted and your bank account has been drastically reduced – time to start saving all over again!