The Refinance Closing Process
The refinance closing meeting can be held at our title company office, 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 the loan documents.
- We will explain each document clearly.
- Your lender will distribute the funds covering the 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 that you can pay your property taxes and homeowner’s insurance along with your monthly mortgage payment.
Refinance Closing Documents
The main focus of a closing meeting is signing the final paperwork. The four main items to review and/or sign during closing are:
Closing Disclosure (CD)
This is an itemized list of your final credits and charges. You should receive a copy of your CD for review at least three days prior to the closing.
Deed of Trust or Mortgage
These are the documents in which you agree to a lien on your property. The lien provides security for repayment of your home loan.
The Promissory Note
The mortgage, also referred to as a 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) estimating your loan costs several days after submitting an application.
There are many elements that 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, which will list your final closing costs. Many of these costs you’ll be aware of ahead of time because they will have been listed in your LE.
Once you’re aware of the closing costs, bring a certified or cashier’s check for the amount of your closing costs to the 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 three-day right of rescission, so if money is due to you at closing, it will not be available until the three days have passed.