The Refinance Closing Process
The refinance closing can be held at our title company office, or the lender’s office, or other agreed-upon location, depending on the circumstances. Here’s a review of what will happen at closing:
- You’ll review and sign all of your loan documents. We will make sure that each document is explained clearly.
- Your lender will distribute the funds covering your home loan amount to the closing agent.
- Depending on your loan terms, you may also be required to set up a new escrow (or impound) account with your lender, so you can pay your property taxes and homeowners insurance along with your monthly mortgage payment.
Refinance Closing Documents
The main focus at a closing is to sign the final paperwork. The four main items to review and/or sign during closing are:
Closing Disclosure (CD)
The itemized list of your final credits and charges, you should receive a copy of the CD for your review at least three days prior to the closing.
Deed of Trust or Mortgage
The documents in which you agree to a lien on your property, as security for repayment of your home loan.
The Promissory Note
The mortgage (or promissory note) is a legal “IOU” that represents your promise to pay the lender according to the agreed terms, including the dates on which you must make your mortgage payments and where they must be sent.
Understanding The Closing Costs
You will receive a Loan Estimate (LE) several days after submitting an application. The LE is an estimate of your loan’s costs.
There are many elements that may go into your total closing costs, including: recording fees, origination fees, appraisal, notary fees, attorney fees, title insurance, and more, depending on your loan program.
Prior to closing your loan, you’ll receive your final Closing Disclosure listing your final closing costs. Many of these costs you’ll know ahead of time, as they were listed in your LE.
Once you’ve determined your closing costs, be sure to bring a certified or cashier’s check for the amount of your closing costs. You’ll need to provide those funds at closing. Typically personal checks aren’t accepted, so make sure to check with your closing agent about which form of payment is acceptable. A refinance has a 3 day right of rescission so if money is due to you at closing it will not be available until the three days are complete.