All the time and effort you’ve invested in your quest for a new home are about to pay off. The closing, sometimes called the settlement, is when your new home finally becomes yours. You sign a small mountain of mortgage-related documents and pay the down payment and closing costs, your lender advances the money for your loan, an attorney or escrow agent distributes the funds, and the seller transfers title to you.
For a smooth closing, you need to do some prep work a day ahead of time. Of course, some glitch—a last-minute schedule conflict for the lender’s attorney, a contractor who hasn’t finished repairs—may delay the closing by a few days. There’s probably nothing to worry about it; a delay isn’t uncommon (see What If the Closing Gets Delayed? below).
What happens at the closing depends partly on where you live. In some states, all of the relevant parties go individually to an escrow agent’s office to sign papers and pay funds; the agent holds these documents and funds in escrow, keeping them in reserve until all the documents are signed and all the money has been transferred, at which time escrow closes and the sale is complete. In other states, the parties meet simultaneously and close the deal together.
Whichever way the closing takes place, you’ll have a lot of papers to sign, and this chapter explains them in detail. You’ll also learn about the moment you’ve been waiting for: taking possession of your new home.