Purchasing a condo or loft in Downtown San Diego is an incredibly exciting experience. Understanding the documents that you’ll have to sign on closing day is important for ensuring that this experience is a wholly positive one. With a comprehensive knowledge of this paperwork, you can bring this transaction to a successful end with both confidence and peace of mind. Following are four of the most important mortgage docs you’ll sign.
1. The Loan Estimate
The Loan Estimate is a relatively new document that was put in place by the Real Estate Settlement Procedures Act (RESPA) and the Truth in Lending Act (TILA). It is intended to replace the Truth-in-Lending disclosure and the Good Faith Estimate. Mortgage lenders will issue this document just three days after your application has been submitted.
The Loan Estimate defines the loan repayment terms and the amount of the monthly mortgage payment. Line item closing costs and the projected payments over the lifetime of the loan will be listed as well. Buyers can use this doc to make fast, effective comparisons of loans in order to identify the options with the best overall value.
2. The Closing Disclosure
The Closing Disclosure closely mirrors the Loan Estimate, however, it is issued to buyers three days from the actual date of closing and acts as a final statement of the accepted loan terms. The Closing Disclosure additionally includes a list of the costs that are paid by sellers, buyers and any relevant third parties. This document gives people the chance to see whether or not any changes exist between the final loan terms and the original quote.
3. The Promissory Note
The Promissory Note establishes the residence as security in the event of loan default. It serves as the actual loan contract and specifies whether or not the loan has an adjustable or fixed rate. This document also lists the payment intervals, interest rate, and penalty amounts.
4. The Deed of Trust
The Deed of Trust is commonly referred to as the Security Instrument. It is another document that records the residence as an instrument of security for the loan. It also defines the terms of residence, such as whether the property will be owner-occupied, used for rental purposes, or used as a secondary residence.
Working with a friendly and experienced agent from a trusted Downtown San Diego real estate brokerage can make the home-buying process as seamless as possible, from your first showing to signing on the dotted line. Make an appointment with us today by calling (619) 649-0368. We look forward to hearing from you! ')}