What’s a CD?
If you’ve ever sold or purchased a home you’ve likely heard that your title company is waiting on a CD. And if you’re like me, you assumed they meant Bon Jovi’s classic Slippery When Wet and then wondered why those nice title people don’t just get Spotify or Apple Music?
It turns out that CD stands for “Closing Disclosure” and is provided by the lender to review at least 72 hours before closing. Courtesy of HouseLogic.com, you should compare it to the Loan Estimate you received shortly after you applied for the loan.
“The point of this formal review process is to ensure there are no surprises at the closing table. If there’s a significant discrepancy between the Loan Estimate and CD, notify your lender and title company immediately. Depending on what the underlying issue is, the closing has to stop and a new closing disclosure must be sent out with a new three-day review period.
There are a couple things on the Loan Estimate that can’t change by the time you get the CD — namely interest rate and lender fees. Some items can change by only 10% (fees paid to local government to record the mortgage might be one); and others can change without limit, like prepaid interest, because it can’t be predicted at the start of the loan process.”
What are the different financing options and what documents are needed for each?
Admittedly, this is a strangely specific question. It’s specific because I had the answers and needed to find a way to ask the question. Just like watching your favorite newscast.
Again from the good folks at HouseLogic.com, every loan type has specific requirements for pre-approval. They vary depending on loan type, ownership, employment status and more.
Instead of quoting them verbatim, click here to learn more.
What do I need to know about closing?
You may have even closed on a few homes in your life and had this question. Courtesy of the Real Estate Buyer’s Agent Council (REBAC) and your friendly Accredited Buyer’s Representative (ABR), here are some common closing questions and answers:
WHAT IS CLOSING?
Closing (also called settlement) is the legal transfer of property ownership. Usually, but not always, possession is transferred at closing. Sometimes the seller may ask to close the sale but retain possession, and pay rent to the buyer until vacating the property at a later date.
WHO ATTENDS CLOSINGS?
Face-to-face closings are common in most states, although a few states do not require them. Your ABR® (Chad Note: I’m one of those) can provide details for your situation. The participants usually include:
- You, the buyer.
- The seller.
- The real estate agents representing the buyer(s) and seller(s).
- Attorneys for the buyer(s) and seller(s) as needed.
- The closing agent, the title insurance representative, and the escrow agent. Often one person fulfills all three roles, coordinating and recording the exchange of the documents and money, disbursing funds, and handling various closing details.
WHERE IS CLOSING HELD?
Closings are usually held at a title company’s office. Their job is to confirm the current legal owner of the property, reveal any mortgages, liens, judgments or unpaid taxes on the property, and identify any restrictions that may affect the sale of the property. Any problems need to be corrected before a buyer can receive “good title.”
WHAT DO I NEED TO BRING?
Your ABR® can advise you on what you’ll need to bring to closing, but typically buyers must provide:
- Payment of closing costs
- Proof of insurance
- Approval of inspections of the property