4 Mortgage Documents You Need to Know About in St. Louis
Getting a mortgage for the first time can be a long process. There’s a lot of paperwork to sign, and you need to be vigilant about every step of the process. If you forget to sign something or don’t read a document closely, you may be in for some big surprises when it comes time to close.
Here are the four mortgage documents you need to know about in St. Louis.
Closing Disclosures and Loan Estimates
These two documents will be vital to the St. Louis home buying process, and you need to make sure you read each one carefully.
The first one you’ll receive is the loan estimates document. This document will be sent to you within the last three days of the application process with a lender. It will outline the terms of your loan, including the projected payments you’ll be making over the lifetime of your loan as well as line item closing costs. This document will help you see the long and short-term costs your loan, which will help you prepare for payments.
The closing disclosure form will come to you within the last three days before you close on your mortgage. It will also outline your loan payments, but it will also itemize your closing costs, so you, the seller and any third parties can tell who is paying what. You’ll have those three days to prepare and read over everything before the closing date.
During this time, make sure you go over all of these mortgage documents to ensure that everything looks okay to you. Look for any obligations you will need to fulfill as well as any fees. Pay attention to the timing rules so you don’t miss a deadline.
If everything looks good after that three-day period, then you will have to sign all of the loan documents. Your realtor will help you figure out if the documents are acceptable.
The Promissory Note
You’ll get this note in your loan documents. It will document the contract or your loan as well as the terms. Here you will find the specific rates as well as the payment intervals and changes as you go along. If your loan is subjected to a prepayment penalty for being paid off early, the promissory note will tell you.
This will also hold you accountable for the loan. If you don’t repay the loan to the terms of the note, the lender can take your house.
The Deed of Trust, Mortgages or Security Instrument
This deed of trust is the official document that puts your property as a security for the loan.
Your mortgage will specify which occupancy provisions you must abide by. These provisions are:
- Owner-occupied: You move into the property 60 days after closing and live there for at least one year. After that, you can rent it out or use it as a second home.
- Second home: This property is your second home, and it cannot be rented out.
- Non-owner occupied: You must pay a higher rate, but you can move it to second home or owner-occupied whenever you want.
As you prepare for the final stages of the St. Louis home buying process, take the time to collect all of the necessary paperwork as soon as possible. Having your mortgage documents on hand and in order will help get you into your new home quicker.