Are closing costs and cash to close the same thing?
No. Closing costs and cash to close are related, but they are not the same. Closing costs refer to the fees associated with your loan, such as lender fees, title costs, and prepaid items. Cash to close is the total amount you are required to bring to closing, which may include your down payment plus any remaining closing costs after credits or deposits are applied.
When do I find out the final amount needed for closing?
You will receive your final figures on the Closing Disclosure, typically a few days before closing. This document outlines your exact cash to close and loan terms so you have time to review everything before signing.
How is my mortgage credit score different from Credit Karma?
Mortgage lenders use specific scoring models that are different from the scores shown on Credit Karma or other consumer apps. While those tools are helpful for monitoring trends, the score used for your mortgage may be higher or lower depending on the model and data being reviewed.
What about cash deposits—are they allowed?
Cash deposits are not always usable for a mortgage. Lenders must be able to document where funds came from, so large or recent cash deposits can create additional questions or conditions. If you anticipate a deposit, it’s best to discuss it ahead of time.
Are appraisals and home inspections the same thing?
No. An appraisal determines the home’s value for the lender, while a home inspection evaluates the property’s condition for you as the buyer. Appraisals are required by the lender; inspections are optional but highly recommended.
Can I change jobs while buying a home?
Changing jobs during the mortgage process can affect your approval, especially if the pay structure or industry changes. Always talk with your loan officer before making employment changes so potential issues can be addressed early.
Why do lenders need so many documents?
Mortgage guidelines require lenders to verify income, assets, debts, and employment to ensure the loan meets lending standards. While it can feel repetitive, this documentation helps protect both you and the lender.
Can my loan terms change before closing?
Some items, such as final figures or interest rates (if not locked), may adjust before closing. Any changes are disclosed to you in writing so you can review them before signing.