Closing on a Home Mortgage

author imagePosted by Mascoma Bank on February 10, 2022

We asked our Mascoma Mortgage lending team to answer a few questions to help demystify the mortgage closing process.

What is “Closing” and how does it work?

“On closing day, the ownership of the property is transferred to you, the buyer. This consists of transferring funds from escrow, providing mortgage and title fees, and updating the deed of the house to your name.”

Sherry Noyes – NMLS #1135349
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“Closings can seem intimidating but they’re not! You’ll show up with your down payment money and your attorney walks you through all the paperwork, including the promissory note and mortgage deed, to ensure you understand exactly what you’re signing. You’ll get the keys and be congratulated for officially buying your first home, typically in under an hour!”

Cody Dana – NMLS #1791451
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“Many things happen at a closing. You will review and sign the mortgage paperwork with the closing agent and have the opportunity to ask the closing agent, lender, and realtor any questions you may have about the mortgage or the property you are purchasing. You may also be able to meet the seller and ask the seller any questions you have about the property. And, most importantly, you become the legal homeowner of the property.”

Sarah Powell – NMLS #446222
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I’ve heard a lot about “closing costs” . . .  what should I know?

“Closing costs won’t be a surprise at the closing table, since we’ve been disclosing these to you since the start, but here’s what you can expect: appraisal fee, legal fees, processing fees, document recording fees, credit report, and flood certificate fees are all very standard. You may also have secondary market fees, taxes that must be paid at closing, and fuel prorations. If you don’t understand a fee that is on your Loan Estimate, please don’t hesitate to ask your lender to explain!”

Cody Dana – NMLS #1791451
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“As a general rule, expect to pay 3% to 6% of your total loan value in closing costs. This means that if you take out a mortgage loan worth $200,000, you’ll typically pay $6,000 to $12,000 in closing costs. You can see an itemized list of every closing cost you need to pay for when you get your closing disclosure.”

Sherry Noyes – NMLS #1135349
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“First-time home buyers usually need to be prepared to pay closing costs at the time of the closing. They should make sure they have a good understanding of what those closing costs will be from their lender by reviewing a Loan Estimate in detail.”

Sarah Powell – NMLS #446222
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Next: Understanding Home Owner Expenses