Closing Day Demystified: Final Steps Before You Own Your Home

Question

What happens on closing day?

Answer

Closing day marks the final hurdle in your home‑buying journey. This critical meeting brings together buyers, sellers, lenders, and title representatives to complete paperwork, transfer funds, and hand over keys.

Here’s what typically happens on closing day:

Final Walk‑Through
Buyers revisit the property—usually 24 hours before closing—to confirm agreed repairs, check appliances, and ensure no new damage has occurred.
Document Signing
You’ll sign multiple documents, including the Closing Disclosure, mortgage note, deed of trust, and various affidavits. Take your time, read each page, and ask the closing agent for clarification on any unfamiliar terms.
Funds Transfer
Your lender wires the loan proceeds to the escrow or title company. You’ll provide a cashier’s check or arrange a wire transfer for the down payment, closing costs, and prepaids (insurance, taxes). Closing costs typically run between 2%–5% of the purchase price, so prepare accordingly.
Title Transfer
The title company verifies clear title, records the new deed with the county recorder’s office, and issues title insurance. Recording fees vary by state and county.
Key and Document Exchange
Once funds clear and documents record, you receive the keys, garage openers, and any warranties or homeowner association documents. Keep these in a safe place.

During closing, you may encounter last‑minute fees for prorated property taxes, HOA dues, or utility adjustments. Ask the closing agent to explain any unexpected charges before signing.

After signing, the closing agent submits documents for recording—this can take one to three business days depending on local processing times. Once recorded, you officially own the property. The seller receives proceeds, and the lender secures its lien against the home.

Final reminder: Before closing day, verify your wire instructions directly with your lender or title company to avoid wire fraud. Buyers are recommended to coordinate with a licensed real estate agent and review all closing statements in advance to smooth out any surprises.