You’ve bought your home, secured a mortgage and now you have to get ready for the real estate closing. This is a big deal, not only because the real estate closing attorney is employed by the lender, but also because there are important records and documents that will be needed for reference at the closing.
About Real Estate Closing
In most parts of the US, closing agents or escrow agents do the real estate closing and handle the money involved. In Georgia, state law requires a real estate closing attorney (who might be a Peachtree City attorney) to fulfill this function, and if you are the purchaser, chances are the first time you will meet this person will be at the closing.
When you shop around for a mortgage, you will get loan estimates from prospective lenders. This doesn’t mean that they are committing to the loan, or that you are obliged to accept them. It is simply an estimate of what the loan will probably cost you if you accept it.
You could have several loan estimates, but you will only accept one of these prior to closing.
By law, the lender must provide you with a closing disclosure document at least three days before the closing is scheduled. This closing disclosure will indicate your loan terms, including what amount goes towards repaying the loan itself, and what is allocated to interest.
It will also provide you with all the details about the loan, including its key terms and a full list of costs you will be liable. Loan and other costs include:
- Origination costs for the loan, including application fees and underwriting costs to make sure the financial and credit information you have supplied is correct.
- Costs of services like credit reports and appraisals required by the lender.
- Relevant discount points that you might choose to pay to reduce the interest rate payable.
- Costs of having title of the property put into your name.
- Property taxes due on the lot.
- Homeowner’s insurance as required by the lender, which is often paid in advance for the year ahead. Flood insurance may also be required.
- Whatever portion of the mortgage that needs to be paid in advance.
And it will indicate the “costs at closing” which is what you need to take with you to pay the real estate closing attorney – although there will be other fees required by the lender’s attorney at closing. These should be detailed in the loan disclosures section.
While the initial loan estimate should have given you a good idea of what you will have to pay at real estate closing, the closing disclosure is the more accurate document. There may be some minor differences, but there shouldn’t be any changes that are significant.
Documents to Take to Your Real Estate Closing
The two documents you will receive prior to closing with a Peachtree City attorney or any other Georgia real estate closing attorney will be completed by the lender. Mentioned above, these are the three-page loan estimate and five-page closing disclosure forms. Take both of these with you for reference purposes. If there were any major changes to the initial loan estimate, your lender should have provided you with a revised loan estimate. This has to be dome no less than seven business days before consummation, which is when the purchaser becomes contractually obliged to the loan. If you have an updated document, take that with you too.
These two forms are vital, and replace four forms previously used for closed-end residential loans – or mortgages. These were:
- The Good Faith Estimate (GFE) that listed all the basic information of the mortgage and its terms.
- The Truth-in-Lending Act (TILA) that was key to finance charges and payment amounts, as well as the annual percentage rate (APR).
- The TILA final disclosure document.
- The Housing and Urban Development (HUD)-1 settlement statement that listed all charges and credit payments due to sellers and to buyers.
Prior to closing you will have had to provide the real estate closing attorney with various details including copies of trusts, wills, powers of attorney and homeowners or hazard insurance. They will also need your social security number.
Additionally take these items to the closing:
- Two types of photo identification. It should go without saying the name on your ID documents must be identical to those on the closing documents mentioned above.
- A copy of the declaration page that appears in your homeowner’s or hazard insurance policy.
- Any other documents the real estate closing attorney has called for. These might include tax returns.
- A power of attorney if this is required. Generally the real estate closing attorney will need to approve this in advance and will retained by their firm.
- Funds that will cover closing costs. Note that in terms of Georgia law any amount over $5,000 must be in the form of wired funds or funds drawn on a Georgia attorney’s trust account. You can though write out a personal check for any small adjustments.
Do You Need Legal Advice?
If you feel you need legal advice to ensure everything regarding your mortgage has been carried out correctly, and that your contract is sound, you might want to consult with an attorney with real estate experience. There is no point asking the real estate closing attorney for advice as this person represents the lender, which means there is a conflict of interests.
Slepian, Schwartz & Landgaard are a trusted Peachtree City attorney firm that specializes in city real estate, including closings. Whether you just want advice or need us to be at the closing with you, call now, and rest assured you will have us on your side.
If you are a lender, we welcome you to make use of our excellent real estate closing attorney services.