Agent's Guide to Closing a Home

You've helped your client purchase their first house. Congratulations! Let us help you prepare for your client's closing with our easy-to-follow real estate closing checklist.

We're going to break this down into two stages: before closing and during closing. Let's look at what you'll need to know in each stage.

Real Estate Closing Checklist: Before Closing

There are a few things you can help your clients do before closing to help the process move along more smoothly. Use this checklist to prepare your clients in advance.

1. Choose a Title Company or Closing Agent

Depending on where you live, the closing might be handled by a title company, a closing attorney, or an escrow agent. It's possible your client might need all three. As the real estate agent, you'll need to advise them of who to call. Find out which professionals need to be present for the closing. Then choose somebody and schedule a time and place. 

2. Make Sure Your Clients Have Secured Homeowners Insurance

They won't be able to close without it, as lenders require it. Plus, it offers them peace of mind should an accident or robbery occur.

3. Find Out How Much the Client's Closing Costs Will Be

They will need the exact amount at closing. If they're working with a lender or mortgage officer, they should be able to provide you with this information.

4. Advise Your Clients They Will Need to Gather Certain Items Before Closing

The closing process varies a little by state and region. Here is a list of common items that are required in most areas:

• The exact amount of the buyer's closing costs in the form of a cashier’s check or proof of an electronic transfer.

• The closing disclosure. 

• A real estate lawyer.

• The client's spouse or co-borrower if someone else is co-signing the loan. 

• A checkbook, in case there are any last minute changes to the closing costs.  

• Driver’s license or other government-issued photo ID.

5. Ensure Your Clients Request Their Closing Documents

The client is legally required to receive these three days in advanceCompliance Resources Mortgage Resources Tila Respa Integrated Disclosures Tila Respa Integrated Disclosure Faqs Compliance of closing. You might want to schedule time to review the documents together and compare the disclosures to the most recent mortgage loan estimate.

6. Review Frequently Asked Client Questions and Be Prepared to Answer Them

Some of the questions you might face include:

• Do my loan terms, interest rate, and monthly payment match what I was expecting?

• Are there any additional fees that I don't know about?

• Do I have an escrow account? How does that work?

• Is my information correct on each of the documents?

• What happens if I don’t make my mortgage payments?

• Do I have a Right to Cancel (refinance only)? How does that work?

• What happens if I choose to walk away? Will I owe the seller money?

• How do I protect myself from a mortgage scam?

• How do I pay my property taxes, homeowners insurance, and HOA dues?

• Who can I call if I have questions after closing?

Real Estate Closing Checklist: Closing Day

It's closing day! Here's what to expect.

1. Advise Your Client to Bring the List of Items They Prepared Above

They might need them during closing, and not having them could delay the process.

2. Ensure the Client Reviews All Documents Carefully

They should take all the time they need and read everything. It's important that they understand what they're signing. Be prepared to advocate for them if they have any questions or concerns.

3. Inform the Client About the Documents They'll Receive

Closing is infamous for the mounds of paper involved. Be prepared to explain these documents to your client:

• Closing disclosureWhat Is A Closing Disclosure En 1983 Ask Cfpb: This outlines all the terms of the loan.

• Loan application: This is the completed version of the application they originally filled out when they applied for the loan. 

• Loan estimate: This document covers terms, interest rate, closing costs, and any other mortgage costs.

• Promissory note: This legally binds the client to pay the mortgage.

• Deed of trust: By signing this document, the client agrees to put their house up as collateral should they fail to pay the mortgage.

• Initial escrow statement: This outlines the property tax and insurance payments that will come from the escrow account.

• Certificate of occupancy: This only applies to newly constructed homes.

• Title documents: This document shows who owns the property and notes any liens on the titleF 201308_cfpb_respa_narrative Exam Procedures.pdf Files.consumerfinance.gov. If liens exist, the seller will have to pay them before closing. 

• Deed: Document that transfers property ownership (for purchases).   

• Right to Cancel (for refinance).

4. Enjoy Your Earnings

Good news! You'll likely get cut a commission check at closing as well. This will be a percentage of the home's sale price and is your reward for bringing the buyer to the sale.

We hope this is helpful. Your first closing as a real estate agent is a big deal. It always helps to come prepared! 

If you'd like to help clients through this process but aren't an agent yet, register for one of our online pre-licensing real estate coursesReal Estate License to get started.