STEP #8: Closing the Loan.

The process is almost over. This is when all final paperwork is completed and signed, down payment and other expenses paid, and the title transferred to your name. Here is a list of costs often associated with closing:

• Origination fees for the cost of loan processing.
• Cost of property survey.
• Cost of property appraisal.
• Advance payment of mortgage insurance premium, if required.
• Advance payment of hazard insurance premium, if required.
• Advance payment of earthquake insurance premium, if required.
• Title insurance fees.
• Recording and transfer fees.

If you make a down payment of less than 20 percent of the purchase price, you will be required to carry some type of mortgage insurance in case you default on the loan. Once you’ve built enough equity in your home, you will no longer be required to carry this insurance.

At the closing meeting, there are many documents that you will be asked to sign. Your First Western Mortgage representative will explain each to you, answer any questions, and only ask for your signature once he or she is certain you’re making an informed decision. These documents may include:

• HUD-1 Settlement Statement — an itemization of all funds and costs paid by the buyer and the seller at, or prior to, closing.
• Truth-In Lending Disclosure — information regarding the annual percentage rate, finance charge, amount financed, total of payments and payment schedule.
• Note — a binding legal agreement to make your mortgage payments according to the terms agreed upon.
• Deed of Trust or Mortgage — Legal documentation showing that the lender has a lien on your property as collateral for the loan.

Once all of this is complete, there’s one final item you’ll receive — the keys. Congratulations. You now own your new home.