One of the best things a homebuyer can hear is, “we have ‘clear to close.’” It’s one of the biggest milestones in the mortgage lending process and means the underwriter has cleared the application to move forward to document signing and close of escrow.
While a critical stage for the sale, this is not the final step in closing on a new home. There are several things that can still affect the transfer of title. After the underwriter clears the file, the buyer will receive the closing disclosure.
This is provided at least 3 days before the closing date and provides the final fees and costs. There shouldn’t be any surprises in the document, but the buyer must review and make sure the terms are acceptable. The close date will also be finalized at this time.
Any discrepancy in the terms of the document and buyer’s expectations can still throw a wrench in the closing. Another step after “clear to close” is the final property walk-through. The buyers and their agent will walk through the home and make sure that the condition is the same as it was at the time of offer. They will also check for any agreed upon repairs.
Finally, many lenders perform one more credit check and job verification on the day of the close. Any change can prevent the loan from closing. Typically, after a “clear to close” is issued, you can expect to close 4-7 days later. Understanding the steps to close will prevent misunderstandings and help buyers plan their move accordingly.