Close On Your New Home

Closing is when the loan funds, the title transfers to you and you receive the keys. In California, this happens through an escrow company: you sign loan and escrow documents, deposit your cash to close, and the sale is complete when the deed is recorded with the county. Plan for a final walkthrough, a Closing Disclosure review and a wire-fraud check before you sign.

What are the final steps before closing?

After the appraisal (appraisal step), your file goes through final underwriting. The underwriter may ask for last-minute documents, such as updated pay stubs, bank statements or insurance details. Answer fast. When all conditions are cleared, the lender issues a “clear to close,” which means the loan is ready for final documents.

1. Conditional approval: the underwriter lists the items still needed.
2. Clear to close: all conditions are satisfied and the lender prepares closing documents.
3. Closing Disclosure: you receive your final loan terms and costs.
4. Final walkthrough: you check the home before signing.
5. Signing: you sign loan and escrow documents.
6. Funding and recording: the lender funds, and the deed is recorded.
7. Keys: you receive possession as your contract states.

During this period, do not change jobs, open new credit, make large unexplained deposits or buy furniture on credit. Lenders often recheck credit and employment shortly before funding, and surprises can delay or derail closing.

What is the Closing Disclosure and the 3-business-day rule?

The Closing Disclosure is a standard form that lists your final loan terms, monthly payment, closing costs and cash to close. Federal rules require that you receive it at least 3 business days before closing. This gives you time to compare it with your earlier Loan Estimate, ask questions and fix errors. Our TRID guide to the Loan Estimate and Closing Disclosure explains every section.

Some items can trigger a new 3-day waiting period if they change after you receive the form, such as a significant rise in the annual percentage rate, a change in the loan product, or the addition of a prepayment penalty. Smaller changes, like an adjustment to a closing cost, usually do not restart the clock. Lender and broker fees cannot increase from the Loan Estimate, certain third-party fees can rise by no more than 10% in total, and others can change.

What to check on your Closing Disclosure

• Loan amount, interest rate and loan type match what you agreed to.
• Monthly principal, interest and estimated escrow payment make sense.
• Lender and broker fees match your Loan Estimate.
• Seller credits and your earnest money deposit are shown correctly.
• Your name and the property address are accurate.

How does California escrow work?

Escrow is a neutral third party that holds money and documents until every condition in the contract is met. It opens when your offer is accepted (offer step), and an escrow officer coordinates with your agent, the seller’s agent, the lender and the title company. In Southern California, escrow and title are often handled by one company; in other areas, they are separate. Practices, including who customarily pays which fees, vary by county.

The title company researches the property’s ownership history, finds liens or claims, and issues title insurance. The lender requires a lender’s title policy, and you may also choose an owner’s policy to protect your own interest. The escrow officer prepares the settlement statement, collects funds from you and the lender, pays the seller and others, and ensures the deed is recorded.

What should you do at the final walkthrough?

The final walkthrough usually happens within a few days before closing. It is your chance to confirm the home is in the agreed condition. Bring your list of requested repairs and the inspection report (home inspection).

• Verify that agreed repairs were completed, and ask for receipts or invoices.
• Run faucets, flush toilets, test lights, appliances, heating and cooling, garage doors and outlets.
• Check for new damage, items left behind and that fixtures included in the sale are still there.

If something is wrong, tell your agent immediately. Do not sign until the issue is resolved or addressed in writing, because after closing it is much harder to get a remedy.

How do you protect yourself from wire fraud?

Criminals impersonate escrow officers, agents or lenders and send fake emails with new wiring instructions. Money sent to a fraudulent account can be very hard to recover. Protect yourself with these habits.

• Get wiring instructions from the escrow company at the start of the process, and confirm them by phone using a number you found independently, such as on the company’s official website or from your agent in person.
• Be suspicious of any email that changes wire instructions, asks you to act urgently or comes from a slightly different email address.
• Never send bank account or Social Security numbers by regular email.
• If something seems wrong, call your escrow officer and your bank right away.

If you receive any message that changes wiring instructions, even one that seems to come from us, call us at (949) 333-4636 before you act.

How much cash will you need to bring?

Your Closing Disclosure shows the exact amount. Typical California closing costs run about 2% to 4% of the purchase price, depending on the county, the loan type and any seller credits. They include lender and broker fees, appraisal, title and escrow charges, recording fees, prepaid interest and prepaid insurance and property tax reserves. Your earnest money deposit is credited toward the total.

Pay by wire or cashier’s check as your escrow officer instructs.

What happens at the signing?

Signing usually takes place at the escrow or title office, or with a mobile notary at a location you choose. Plan on an hour or more. Bring:

• A valid government-issued photo ID that matches your name on the loan documents.
• Your cash-to-close funds, using the method escrow requested.
• Proof of homeowners insurance, if not already provided.

You will sign the promissory note (your promise to repay), the deed of trust (which secures the loan with the property), the Closing Disclosure and various escrow, tax and occupancy forms. Read what you sign and ask questions. You will also see the first payment date and the details of your escrow or impound account, if one is set up for taxes and insurance.

When do you get the keys?

After you sign, the lender reviews the signed package and releases the funds to escrow. Escrow then records the deed with the county recorder, and the sale is officially complete. Your agent will tell you when you can pick up the keys, which is generally upon recording unless your contract says otherwise. This can be the same day or the next business day, depending on timing. Get all keys, garage openers and manuals, and consider changing the locks right away.

Congratulations, you now own a home. Keep your closing documents in a safe place. If you need to revisit earlier steps of the process, start with the Buying a Home guide.

At Lendia, we stay with you until the keys are in your hand

At Lendia, we compare options from multiple lenders to fit your situation, and we stay in touch with your agent and escrow officer through funding so you know what comes next. Contact us or get a rate quote now. Rates and terms depend on your situation; approval requires qualification. Use our FHA, VA and conventional program pages to see how each loan type works.

Frequently Asked Questions

What does “clear to close” mean?

It means the underwriter has approved your loan and all conditions are met. The lender can now prepare final documents for you to sign.

Can I close in less than 3 business days after receiving the Closing Disclosure?

Generally no. You must receive the form at least 3 business days before closing, with limited exceptions. Ask your loan officer how the timeline applies to you.

What if the walkthrough shows a problem?

Tell your agent right away. Do not sign until it is fixed or the parties agree in writing on how to handle it.

Do I need to be at the signing in person?

Often yes, but arrangements such as a mobile notary may be available. Check with your escrow officer.

When do I get the keys in California?

Usually after the lender funds and the deed is recorded, as stated in your purchase agreement. Your agent will confirm the timing.

How can I avoid wire fraud?

Confirm wire instructions by phone using a known number, never rely on emailed changes, and call to confirm receipt after sending.