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Closing is the final step in buying your home. The loan documents are signed, your closing funds are received, the seller signs the deed, the title company completes the financial side of the transaction, and ownership transfers to you.
With a financed purchase, closing is also when you sign the documents that make the mortgage official.
CLOSING DOES THREE BIG THINGS
A closing can be completed at a title-company office, with a mobile notary, or with remote/electronic signing when the title company and lender support it.
YELLOW recommends title services that make remote signing available when possible. Even with a remote closing, some lender or title documents may require a specific signing or notarization method.
For most purchase mortgages, your lender must provide the Closing Disclosure at least 3 business days before closing.
This five-page form shows the final loan amount, interest rate, projected payment, closing costs, credits and the amount of cash you need to close.
COMPARE IT TO YOUR LOAN ESTIMATE
If something is unexpectedly different, get it corrected before closing rather than trying to sort it out while everyone is waiting to sign.
Your AS-IS contract gives you access for the final walkthrough on the day before Closing or on Closing Day before the closing occurs.
Confirm the property is still in the required condition, agreed work is complete, included items remain, and the seller has removed personal property and debris as required for possession at closing.
YELLOW SAYS...
VERIFY THE WIRE BEFORE SENDING MONEY
If the title company tells you to wire your closing funds, verify the wiring instructions by calling the title company at a phone number you already know is correct.
Never trust a last-minute email changing wiring instructions without independently confirming it. Real-estate wire fraud often happens immediately before closing.
A financed buyer signs quite a few documents. The exact package is prepared by the lender and title company, but the important documents have fairly simple purposes.
CLOSING DISCLOSURE
The final summary of your mortgage terms and closing costs. You should already have reviewed it during the 3-business-day period before closing.
PROMISSORY NOTE
Your written promise to repay the mortgage loan according to its terms. It states the amount borrowed, interest terms and repayment obligations.
MORTGAGE
The mortgage places the property as security for the loan. If the loan is not repaid as required, this document gives the lender its legal security interest in the home.
INITIAL ESCROW DISCLOSURE
If your lender is escrowing taxes and insurance, this explains the expected deposits and payments through the escrow account.
TITLE / CLOSING DOCUMENTS
The title company may have additional affidavits, tax documents, ownership forms and settlement documents needed to complete and record the purchase.
The deed is the document signed by the seller to transfer ownership of the property to you. The title company sends the deed for recording in the county's official records after the closing requirements are satisfied.
You usually do not walk away from the closing table holding the recorded original deed. The important event is that the deed is properly executed and recorded into the public records showing you as the new owner.
Closing documents can look intimidating, but you do not need to race through them. Confirm that names, property address, loan amount, interest rate and financial figures are correct before signing.
Never sign a blank document or a document that materially differs from what you agreed to.
The title company acts as the financial hub for the closing. It receives the buyer's funds and, for a financed purchase, the lender's funds.
From those funds the title company pays the amounts shown on the settlement documents, which can include:
Your escrow deposit is not lost or paid twice. It appears as a credit toward the money you already owe for the purchase.
CASH TO CLOSE
Your Closing Disclosure shows the final amount you must provide. This figure accounts for the down payment, closing costs, prepaid items, escrow deposits already paid, seller credits and other transaction adjustments.
Signing is only one part of closing. The title company must also receive the required funds and documents and confirm that the transaction is ready to close.
Once the closing is completed, the seller's deed is delivered for recording and ownership transfers to you. Under the standard YELLOW sale contract, possession is delivered at closing.
That is when you receive the keys, garage remotes, access codes and other items being transferred with the home.
DON'T MOVE IN BEFORE CLOSING IS CONFIRMED
Even if you signed early in the day, wait until the title company confirms that the transaction has closed before assuming possession or starting the move-in.
Most transactions close as scheduled, but last-minute delays can happen. Common examples include lender funding delays, a missing document, a wire that has not arrived, an unresolved title item, or a problem discovered during the final walkthrough.
The YELLOW AS-IS contract includes a short extension of up to 7 days when Closing must be delayed to satisfy certain CFPB mortgage-disclosure requirements.
If there is a last-minute problem, keep your phone available and respond promptly. Many closing-day issues can be fixed without changing the transaction itself.
Once closing is confirmed, the home is yours. Keep your closing paperwork because you may need it later for taxes, refinancing, insurance, warranty questions or when you eventually sell the property.
KEEP THESE RECORDS
CONGRATULATIONS ON BUYING A HOME!
Pre-closing
