The Orange County Register

Too often, when you sit down to sign the loan documents, you discover that the interest rate, points or some other feature is not what you expected.

Borrowers are at their most vulnerable point when sitting down to sign the paperwork, and a shady lender may try to exploit your disadvantage. There are some steps you can take to reduce your risks.

After your loan is first approved, get a loan commitment in writing. It should spell out the size, interest rate, fees and other details of the loan. If possible, include an expected closing date. Get the rate lock-in in writing, too. Otherwise, the interest rate on your loan may be subject to change until the day you sit down to sign the paperwork.

Get a receipt for all fees that you must pay up front, including the terms under which the money will be refunded in the event that that the loan doesn't close.
Other tips for closing escrow:

Get it in writing:
Take notes during or immediately after conversations with loan representatives. It will help refresh you memory later and may be helpful if you end up disputing the terms. Be wary of lenders or brokers who won't back up what they say in writing. If they won't confirm it in writing, put the terms in writing yourself and send it certified mail to the broker or lender, asking them to respond promptly if your understanding is incorrect. The letter won't protect you completely, but it could help if you end up in court.

Early bird:
Most people sit down to sign their loan papers a day or two before escrow closes. But unless you are under a tight deadline, arrange to have the documents sent to you a week or two early. It will cut down on the stress and enable you to read the papers without everyone looking over your shoulder. Also, if you discover any surprises, there may still be time to fix them.

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