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 Closing the loan
The closing (or settlement) is the meeting at which you sign the paperwork and pay the expenses to obtain your new loan. With a line of credit, you can elect to take a draw at closing or use the checkbook to access the line later. If you run out of checks, just let us know and we'll send you more.
The closing process varies from place to place, but many activities are
standard. You'll sign documents and pay various closing costs.
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Payment Due |
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15th of every month |
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How much will your closing costs be?
What happens at closing
Closing documents you receive
How much will your closing costs be?
A copy of the HUD-1 Settlement Statement will be available for your
review prior to closing and provide the final total for your closing costs.
Typically, on home equity lines of credit, these costs are simply deducted
from your loan proceeds.
Did you want to avoid closing costs? See Handling closing
costs.
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What happens at closing
The meeting usually takes about a half hour and is held at the closing agent's
office or your local Countrywide office (in some states). You may live in an
area where there is no formal closing meeting. In that case, either an escrow
or closing agent, or an attorney, processes all the paperwork, arranges for all
documents to be signed, and collects and disburses the required funds.
The steps below explain what happens during
and after closing:
| 1. |
Closing agent reviews HUD-1 settlement statement with you and you sign it. |
| 2. |
Signatures are collected for loan documents, such as the note and mortgage and
other disclosure documents, such as the Truth-in-Lending statement. |
| 3. |
If the papers are in order, you submit a certified or cashier's check to pay
closing costs (if applicable). |
| 4. |
Lender provides check covering the equity loan amount to the closing agent (if
applicable). |
| 5. |
If applicable, the right of rescission period starts. You have 3 business days (including Saturday) to decide whether to go forward with the transaction. The rescission period expires at midnight of the third business day following the date you received your notice of right to cancel, the date you signed loan documents or the date you received your Truth in Lending disclosures (whichever occurs last). |
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Unless you decide to rescind or cancel the transaction, the loan will be funded after the rescission period expires. The closing agent handles the disbursement of your loan funds. With a line of credit, you can elect to take a draw at the time of funding or use the checkbook to access the line later. If you run out of checks, just let us know and we'll send you more. |
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A few of the key closing documents
you receive
HUD-1 Settlement Sheet
Itemizes the services provided and the charges. You should be allowed to review
this form shortly before your closing meeting so you know your closing costs in
advance.
Truth-in-Lending (TIL) Disclosure (Home
Equity Loans only)
Since it's possible that the annual percentage rate (APR) calculated at your
loan application will change a little before closing, your lender is required
to give you the final version of your TIL disclosure at or prior to the closing
meeting. You should receive your initial TIL disclosure within 3 business days
after applying for a home loan. It outlines the costs of your loan and
discloses the APR and other terms of the loan, including the finance charge,
the amount financed, the payment amount, and the total payments required.
The Note (or Credit Agreement on a
Line of Credit)
The promissory note is a legal "IOU." The note represents your
promise to pay the lender according to the agreed terms of the loan, including
the dates on which your payments must be made and the location to which they
must be sent.
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Equal Housing Lenders. © 2008 Countrywide Bank, FSB, Countrywide Home Loans Division. Member FDIC. Trade/service marks are the property of Countrywide Financial Corporation, Countrywide Bank, FSB, or their respective affiliates and/or its subsidiaries. Some products may not be available in all states. This is not a commitment to lend. Restrictions apply. All rights reserved.