Closing On Your Home – Part 2

Closing On Your Home – Part 2

Closing Activities Checklist

In the weeks before closing, you’ll need to make some important decisions. Your lender and your closing agent will be handling many pre-closing activities. But you still need to be aware of them and know who typically arranges and pays for each activity.

No later than three business days after your loan application was received, your lender should have delivered or mailed to you a “good faith estimate” of the total charges due at closing and a copy of the government publication Settlement Costs: A HUD Guide. Then, one business day before the closing meeting, your closing agent must allow you to review a copy of your two-page settlement form — called the HUD-1 Settlement Statement.

The good-faith-estimate is based on the lender’s typical loan origination costs for the area where your home is located. So the estimate usually changes between application and closing. That is why you’ll want to review your settlement form before the closing meeting. It will show you the actual amount of money you’ll need to bring to closing. Remember that you’ll need to pay your closing costs in the form of a certified or cashier’s check. Personal checks usually aren’t accepted.

Closing costs vary widely depending on price, location, and other factors. Overall, you can expect your closing costs to amount to between 3 percent and 6 percent of the sales price.

More on this topic in Part 3 of Closing on Your Home…