You’re preapproved for a mortgage, you’ve picked out the perfect property, and your offer is accepted. You’re so close to closing on your home that you’ve put the champagne on ice. But before popping any champagne bottles, you need to know what happens on closing day when buying a home.
We’re here to help prepare you for what is involved in the closing process, what to expect on closing day, and what you need to bring on the big day.
What is a closing? When does it happen?
When you buy a home, the last step in the process is called the closing. Your title company will work with you to determine the closing date and time—or the date when you finalize all the details of the transaction and you become a legal owner of the home.
Closings typically happen 4-6 weeks after you sign the sales and purchase contract, though it could take longer. This allows enough time for home inspections, home appraisals, funding, and title searches to clear.
The closing day itself may take several hours as you complete all the final paperwork.
Who attends the closing?
In some areas of the country, the buyer and seller sit down together at closing. In other areas, you won’t even see the seller, as you’ll have separate appointments. And today, many closings are happening remotely, with notaries being dispatched to hotels, offices or a location of choice by the buyer.
The closing agent is usually a title officer or an attorney. It will be a neutral third party to ensure everything is completed correctly. The buyer and the seller will agree on the closing/settlement agent at the time the offer is accepted by both parties.
As far as who typically attends on closing day, when buying:
When you’re selling a home, the following may attend:
What happens on closing day, and what you’ll need to bring
Most of what you’ll need on closing day will be provided to you, but there are a few items you’ll need to bring, too, including:
How much should you save for closing costs?
Closing costs typically make up to 3-6% of the home’s cost. Closing costs are separate from, and in addition to, your down payment. Closing costs cover the appraisal, title insurance, application fees and more.
Depending on the market you’re buying a home in, you may be able to negotiate for the seller to pay for a portion of your closing costs. Bear in mind this typically only happens in a buyer’s market. In seller’s markets, like right now, and the seller receives multiple offers, asking the seller to cover closing costs would likely result in losing the bid.
Getting to closing day was undoubtedly a long process, but be sure to stop and enjoy the moment. It’s the day you officially bought a home, an endeavor in and of itself.
Now pop that bottle of champagne.