Closing is the day ownership transfers and the money moves. The two weeks before it are when problems are cheapest to fix, and the paperwork you receive in that window is designed to let you catch them. Here is what arrives, what to check, and what the final walk-through is really for.
The Closing Disclosure and the Three-Day Rule
At least three business days before closing, your lender must give you a Closing Disclosure: a five-page form setting out your final loan terms, projected monthly payment, and every closing cost. That waiting period exists specifically so you can read it without pressure, and certain late changes restart the clock.
Use the time for its intended purpose: put the Closing Disclosure beside the Loan Estimate you were given when you applied. The forms are deliberately laid out alike so differences stand out. Some costs can legitimately change, some can change only within limits, and some cannot change at all without a valid reason. Question anything that has moved, before closing rather than after.
If you are reading older guidance, you will see the Good Faith Estimate and the HUD-1 Settlement Statement. Those forms were replaced for most consumer mortgages in October 2015 by the Loan Estimate and Closing Disclosure. If someone hands you a HUD-1 for an ordinary home purchase loan, ask why.
What RESPA Protects
The Real Estate Settlement Procedures Act governs disclosure during the settlement process. Three of its protections are worth knowing by name.
- Advance notice of costs — you must be told what settlement will cost before you are committed, which is what the Loan Estimate and Closing Disclosure deliver.
- Disclosure of business relationships — if your agent, lender, title company or inspector are connected by ownership, that affiliation must be disclosed. You are generally not required to use an affiliated provider, and you can shop for several of these services yourself.
- Servicing and escrow rules — you must be told whether your loan may be transferred to another servicer, and given notice if it is. Escrow accounts are also governed, including limits on how large a cushion may be held and an annual statement.
RESPA also prohibits kickbacks and unearned fees for referrals of settlement business. If a service on your disclosure appears to have no function, ask what it is for.
The Final Walk-Through
Shortly before closing, usually within a week, you walk the property one last time. This is not a second inspection and not a renegotiation. It confirms three things: that the property is in the condition you agreed to buy, that agreed repairs were done, and that what was supposed to stay is still there and what was supposed to go is gone.
Do it with the contract in hand, and do it after the seller has moved out if possible, since an empty house reveals floors and walls that furniture was hiding.
- Run taps, flush toilets, and look under sinks for leaks.
- Test the heating and the air conditioning, whatever the season.
- Switch on lights in every room and test a sample of outlets.
- Open and close windows, doors and the garage door.
- Run the appliances that are staying.
- Check that agreed repairs were completed, and ask for receipts or permits.
- Look for damage caused during the move — scraped walls, torn screens, gouged floors.
- Confirm fixtures and included items are present, against your written list.
- Check the basement, attic and garage for anything left behind that you will have to pay to remove.
If something is wrong, raise it before closing. The moment you sign, your leverage is gone: a seller who has been paid has very little reason to come back and fix a broken furnace. Depending on the problem, the usual remedies are money held back in escrow until it is resolved, a credit at closing, or delaying the closing.
On the Day
Bring government photo identification and your funds in the form the closing agent requires — usually a wire transfer or cashier’s check, since personal checks are not accepted for large sums.
One warning that matters more than anything else here: wire fraud targets real estate closings specifically. Criminals monitor email and send convincing last-minute instructions to redirect your down payment. Never accept wire instructions by email at face value, and never act on a change of instructions. Call the closing agent on a number you already had, not one in the message, and confirm the details verbally before sending. Money sent to a fraudulent account is usually gone.
Afterward, keep the Closing Disclosure and your deed. You will want them for tax purposes and whenever you eventually sell.