Settlement Day!

WHAT CAN I EXPECT TO HAPPEN ON CLOSING DAY?

On a purchase loan, the settlement date is the day you take possession of the property. On settlement day the balance of the purchase price and closing costs are paid, and the keys are handed over. The closing agent will go over the money you owe (the remainder of down payment, recordation taxes, lender costs, title costs, prepaid property taxes, prepaid per diem interest, etc). Once you’re sure you understand all the paperwork, you’ll sign the mortgage, agreeing that if you don’t make payments the lender is entitled to sell your property and apply the sale price against the amount you owe plus expenses. You’ll also sign a mortgage note, promising to repay the loan. The seller will give you the title to the house in the form of a signed deed.

You will be provided a settlement statement of all the items for which you have paid. The deed and mortgage will then be recorded in the Registry of Deeds, and you will be a homeowner!

On a refinance, settlement day is simply the day you sign the new mortgage papers. There is usually a “three day right of rescission” that is mandatory. This rescission period means that you have a three day “cooling off period” to ensure you have reviewed the terms and closing papers and are sure you want to proceed, hence, the loan does not become official until the day after the rescission period.