What happens on closing day for the home buyer?

Many home buyers stress about closing day. However, the mere fact that there is a closing means that most of the hard work has already been done.

The lender has approved a loan, assuming there is a loan. If there’s no loan and the purchase is all cash, then the process is even more straightforward, and there will be fewer documents to sign.

The closing is the time for your attorney to shine or the notary to earn their money. Here’s what to expect.

Closing day documents

As a buyer, your job on closing day is to sign the documents in front of you. Expect a deluge of paperwork and your hand to ache. These will all relate to the sale of the home and the mortgage. Your attorney or the notary will explain what they all are as you sign them. The professionals involved will usually e-mail you the documents prior to closing day.

The title company will prepare the Closing Disclosure (also known as the HUD-1 Settlement Statement) a day or two before closing. This document will give an itemized account of the closing costs and the money that the buyer has to bring to the closing. It will also show the amount of money being disbursed to the seller. Last-minute items such as water and sewer bill pay-off are often added on the day of the closing, which can change the numbers slightly.

The property title is signed over from the seller to the buyer, transferring ownership. This happens when the buyer and seller both sign the deed. It is not necessary for two parties to be in the room at the same time. The main documents will include:

Property deed

Bill of sale

Transfer tax declaration

Mortgage agreement and note

Closing disclosure (this details all the financial details of the transaction)

Who will be there?

Those present at a closing in New York will usually be both the buyer and seller’s attorneys and the title agent representing the bank. Often a buyer and seller’s sales agent(s) will also be present or show up toward the end to collect their commission checks.

Sometimes a closing can occur at a notary’s office or even at home if the buyer is unable to make it to an office. In these instances, a notary will handle the closing, explaining what all the documents are. In these cases, it is unlikely anyone other than the buyer and the notary will be present.

Closing day payments

If there is a mortgage, the bank’s title agent will issue a check to your attorney’s escrow account or present it directly at the closing table. If there is no mortgage, then the buyer is expected to bring a cashier’s check for the difference after the down payment.

The seller will receive any proceeds earned from the sale once the existing liens, or debts tied to the property, have been paid.

The sales agents will collect their commission checks

The attorney’s fees will be paid

What happens at the end of a closing?

Usually, the new owner gets their keys. Their attorney’s office will agree to e-mail all the signed documents and/or mail a hard copy. The buyer’s attorney will file the deed with the city, registering the sale and new ownership of the property.