What to expect at closing
The closing is the final phase of your refinancing process where you will meet with the closing agent–usually a title company, signing company, or attorney–to sign your loan documents. As the closing date approaches, you should do the following to make sure it goes smoothly:
Stay in touch with your lender to keep abreast of any issues with your loan. Make sure you know ahead of time if you need to bring any documentation to the closing.
Review your insurance policies to make sure you have adequate coverage for the value of your home and its contents. Make sure your policies list your refinance lender as the payee for losses.
Consider your second mortgage, if you have one on your property. You’ll likely need to obtain a document called a “subordination agreement” from your second mortgage lender. This agreement simply means that the second mortgage will be subordinate to your new refinance loan in terms of which lender has primary claim to your assets if you should ever declare bankruptcy.
Evaluate your escrow account for your current mortgage, to find out if you have either a deficit or surplus of funds.
Verify the amount of cash you’ll need to pay for closing costs. Your closing agent should let you know ahead of time how much you will have to bring to closing. You should get a certified or cashiers check in this amount from the bank–cash or personal checks are generally not accepted.
After the closing, your refinance process will be complete. All you’ll have to do is start taking advantage of your new financial opportunities.
