Closing and funding are the final stages of the mortgage loan process. Closing occurs when borrowers sign loan documents at the title company. Funding occurs after a lender reviews the signed loan documents and wires their funds to the title company. In this blog post, we will discuss what closing and funding entail, and provide an overview of the digital online mortgage process.
The Closing Process
When closing a loan, borrowers will sign a variety of documents, including the loan agreement, promissory note, and closing disclosure. The closing disclosure is a document that provides borrowers with final loan terms and costs. Once all documents have been signed, the title company will prepare for funding.
When you use Warp Speed Mortgage, you may select an eClosing option, which means that some or all of your closing documents can be completed digitally. The eClosing options available to you vary on a state-by-state basis.
- Hybrid eClosing: Hybrid eClosings will allow you to sign some documents digitally, like procedural documents and disclosures, while other documents, like the Transfer Deed or Promissory Note, will be signed in-person with traditional ID verification and a notary present.
- Remote Notary eClosing: Remote Notary eClosings can be conducted from any location* and are completely online. You’ll sign all documents digitally from a computer or tablet and have a notary present via webcam. This type of eClosing does require a digital ID verification.
- In-Person eClosing: In-Person eClosings mean that you will sign all closing documents digitally, from a laptop or tablet, but will still require notary be present and traditional ID verification.
You should be prepared to have your cash to close ready at closing. Your closing agent will give you a closing disclosure form at least three business days before closing that outlines your final costs, so you know exactly how much to bring to closing. Cash to close includes your closing costs as well as your down payment and is typically only accepted via certified cashier’s check or wire transfer.
The Funding Process
When funding a loan, the lender will review all signed closing documents and wire their funds to the title company. When the loan is funded, the title company will record the transaction with the local court. If you’re buying a home, it’s at this point that your loan is officially considered closed, and you are able to access your new home. Depending on your state or county, your loan could close and fund on the same day, or it could take up to a day for the loan to be recorded and officially closed. Ask your loan officer for specific details on how this will work in your location.
The closing and funding processes are the last steps before you complete your home financing process. Be sure to avoid large purchases on credit or major transitions (like switching jobs) until your loan is officially closed and recorded. While these can be exciting times, it’s also important to be aware of what is needed from you prior to closing, so you can ensure there are no delays that may impact your loan. If you’re ready to begin the home financing process, you can get started now!
