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< About Buying Real Estate
On closing day, expect to sign a lot of documents and walk away with a big
stack of papers. Here’s a list of the most important documents you should file
away for future reference.
- HUD-1 settlement statement. Itemizes all the costs — commissions, loan
fees, points, and hazard insurance —associated with the closing. You’ll need
it for income tax purposes if you paid points.
- Truth in Lending statement. Summarizes the terms of your mortgage loan,
including the annual percentage rate and recision period.
- Mortgage and note. Spell out the legal terms of your mortgage obligation
and the agreed-upon repayment terms.
- Deed. Transfers ownership to you.
- Affidavits. Binding statements by either party. For example, the sellers
will often sign an affidavit stating that they haven’t incurred any liens.
- Riders. Amendments to the sales contract that affect your rights. Example:
The sellers won’t move out until two weeks after closing but will pay rent to
the buyers during that period.
- Insurance policies. Provide a record and proof of your coverage.
Sources: Credit Union National Association; Mortgage Bankers Association;
Home-Buyer’s Guide (Real Estate Center at Texas A&M, 2000)
Learn more
about real estate closings
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