Mortgage 101
October 5, 2023

Avoiding Common Closing Costs Surprises: A Guide for Homebuyers

Estimated reading time: 3 minutes

Closing on a home is like the final mile of a marathon you’ve been training for. A home closing finalizes all the details of your new home loan, including the signing of the necessary mortgage loan documentation and paying your closing costs. Most importantly, it’s the last phase of the homebuying process before you’re given the keys to your new house!

Your closing costs are the expenses and fees paid before you’re officially a homeowner. To ensure your closing goes off without delays, be sure you’re keeping this advice in mind.

Keep Your Credit Consistent

One of the most common delays in closing is a change in a buyer’s credit. Your mortgage lender will check your credit before closing to ensure your finances haven’t changed. Any credit changes may indicate new risks that could impact your ability to repay the loan.

Save Major Purchases for After You Get Your Keys

Many people believe that they’re in the clear to make major purchases once a closing is scheduled, but nothing is secured until the documents are signed and the keys in your hand. Major purchases made during the homebuying process will impact your credit history and other factors of your eligibility, such as your debt-to-income ratio. Buying a new car, travel package, or even co-signing on other loans should be postponed until after you’re fully moved in.

Review and Understand Your Paperwork

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A few days before your closing occurs, you’ll receive your closing disclosure. This document will include the home’s purchase price, all origination fees to be paid by the buyer, the interest rate of the loan, and your closing costs.

Comparing your closing disclosure to your original loan estimate will help you remove the guesswork about what exactly is needed at closing. If you have any questions about the information listed, be sure to contact your Loan Originator.

Inform Your Loan Originator of Job or Income Changes

Your loan eligibility may be affected by changes to your job or income. Mortgage lenders need to ensure that you have the finances and ability to repay your mortgage, both of which may be compromised if employment changes occur.

Provide Consistent and On-Time Documentation

Delays or inconsistencies in documentation submissions can significantly delay your underwriting and closing. Mortgage lenders verify, double check, and continue to check your information throughout the homebuying process to ensure you’re still on track to close and pay your loan consistently. It’s important to make sure you’re submitting your documentation and staying up to date with any additional documentation requests.

Home Sweet Home Without Delay

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After all the work you’ve put into house hunting and applying for a mortgage, set yourself up for a home closing triumph! For a mortgage lender who will be with you every step of the way, contact us. Our Licensed Loan Originators have the compassion, industry knowledge, and home loan options for your mortgage success!

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