What Documents Are in Real Estate Closing Package

A real estate closing is the point where you actually borrow money to buy property, requiring a large number of documents. Closure is also where you sign and give you guarantee to repay the loan.

Closing Checklist for a Real Estate Agent How to Prepare for Closing Real Estate

Truth in Lending Statement
This paper is important to check and then check again. It contains information about the interest rate being paid, the annual percentage rate, the amount financed and the total amount to be paid over the life of the loan.

The details of the amount financed
This statement summarizes the financial costs, such as points, that the buyer may pay.

Monthly Payment Letter
This document shows a breakdown of the monthly fee, which includes payment for principal, interest, insurance, taxes and currency Escrow Account.

Mortgage
This is the actual document that places a lien on the property as collateral. It is a document that allows foreclosure by the bank if the loan is not paid.

HUD Form 1 or DisclosureSettlement Statement
Another very important document, this document contains information about the actual settlement costs. Carefully check this paper for errors as the closing agent reviews the form.

Pro-level agreements
This document describes how items such as property taxes and school taxes will be pro-rated by the new owner and the previous month for the property acquired.

Search or Abstract Title
This document can be very long as it provides the history of the property. Any documents that are recorded on the property listed in the abstract.

Deed
It is a piece of paper that actually transferring ownership of real estate from the seller to the buyer. It also contains the legal description of the property.

Insurance
Proof of insurance is required at closing on the property. This can include flood and hazard insurance, depending on the location of the property.

Additional Documents
Depending on the type of transaction and the country in which the sale occurs, there may be additional documents. Some documents Certificate of Occupancy stating the property in accordance with the building and zoning codes, an Affidavit Judgment authorizing both the buyer and seller have a judgment against them, statement assumption if the mortgage is being assumed by the buyer and the Federal and State Estate Tax Affidavit if the previous owner had died.

Sources: Diane Stevens