Closing on a home? Be prepared to review and sign a stack of important legal documents. These closing documents finalize the real estate transaction, and they can be overwhelming, even if you’re a seasoned homebuyer. And if you’ve been renting a house or living in an apartment and now buying a home for the first time, the process might feel completely unfamiliar…
In this Redfin article, we’ll explain each of the key closing documents and their importance to your purchase so you can grab your keys and get home quickly.
In this article:
What are closing documents?
Closing documents are the set of legal forms that you and the seller sign during the closing process. These documents outline final costs for the buyer and verify the sale for the seller.
It might feel like a mountain of paperwork on closing day, but each form plays a key role in confirming your loan terms and what you’ll actually pay at the end. The exact forms you sign may vary depending on your state’s property laws. Your real estate agent or attorney can let you know if your state requires anything additional.
Understanding these documents ahead of time can make closing day feel more manageable and help you confidently finalize your home purchase.
Closing disclosure
A Closing Disclosure shows all the financial details of your mortgage and total closing costs. Your lender must provide this at least three business days before closing so you have time to review it.
A careful review is essential to understanding the loan terms, projected monthly payments, and closing fees. Ask your real estate agent for help with any questions you encounter during your review.
Proof of homeowners insurance
While it’s up to you to decide how much homeowners insurance you need, your lender will require proof on closing day. This protects their investment and your new home from events like fire, vandalism, and natural disasters. Speak to your insurance company as soon as you know the…