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Your Mortgage has been Cleared to Close: What Does This Mean?

Posted by Joseph A. DiPiazza | Jun 04, 2024 | 0 Comments

Congratulations, your mortgage has been cleared to close! This pivotal moment in the home-buying process signifies that you're just a few steps away from becoming a homeowner. But what exactly does “cleared to close” mean, and what should you expect next? Let's break it down.

The Meaning of “Clear to Close”

When your lender informs you that your mortgage is “clear to close,” it means that all the prerequisites for your loan have been met, and the mortgage underwriter has given the final approval. This includes:

  • Verification of your income and assets
  • A satisfactory home appraisal and inspection
  • Approval of your debt-to-income ratio
  • A review of your credit reports for any new accounts or delinquent payments
  • Confirmation that you've secured homeowners insurance
  • A clear title search and title insurance in place

The Final Steps Before Closing

Even though you're clear to close, there are still a few final steps to complete before you can call the property your own:

  1. Initial Closing Disclosure: You'll receive an initial closing disclosure that outlines the details of your mortgage agreement, including the rate, term, loan type, closing costs, and the amount of cash needed to close. By law, you must receive this disclosure three business days before signing your loan paperwork.
  2. Review and Compare: It's crucial to review your initial closing disclosure immediately and compare it with your loan estimate to ensure everything matches up with what was promised.
  3. Cash to Close: You'll need to wire the funds required for the transaction or bring a certified check to the closing, which may include your down payment and closing costs. Make sure to get clear instructions from your lender or attorney on how to proceed.
  4. Final Walkthrough: This is your last chance to inspect the property before it officially becomes yours. Check for any issues that need to be addressed before closing.
  5. Closing Day: On the closing day, you'll sign a lot of paperwork, including your loan documents. Once all the documents are signed and the funds are distributed, you'll receive the keys to your new home.

What to Watch Out For

While being cleared to close is excellent news, it's important to maintain your financial status quo until after the closing. Any significant changes, like large purchases or a change in employment, could affect your mortgage terms or even result in a last-minute denial.


Being cleared to close is a significant milestone in the home-buying journey. It means you've passed all the hurdles and are on the brink of homeownership. Just remember to stay vigilant, review all documents carefully, and keep your finances stable until the deal is officially sealed.

For more detailed information on the closing process and what to expect, please contact Joseph DiPiazza, Esq.

About the Author

Joseph A. DiPiazza

Joseph DiPiazza, Esq. is a highly accomplished real estate lawyer with a wealth of experience specializing in residential real estate transactions.


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