Key Takeaways
- 'Clear-to-close' means your loan is fully approved for closing.
- Expect your closing disclosure 3 days before your scheduled closing.
- Avoid major financial changes to keep your clear-to-close valid.
- Schedule your closing appointment once you've received clear-to-close.
Article Summary
"Clear-to-close" or "cleared-to-close" is the final stage of mortgage underwriting, signifying that all prerequisites have been met and your mortgage lender has given the final approval for your loan.
Clear-to-Close: Explained in Plain English
Clear-to-Close, or CTC, is one of the final stages in a first-time home buyer's mortgage approval. When a buyer receives their clear-to-close, it means their mortgage application's conditions for approval have been fully met:
- Income and asset information are reviewed and approved
- Home appraisal and title reports are confirmed and valid
- Purchase contracts are legitimate and signed
A mortgage that is clear-to-close is ready for signatures.
Generally, a few days pass between receiving a clear-to-close on a mortgage and signing for the new house and keys. During this time, buyers can expect to schedule their closing date, review final mortgage documents, and wire the necessary funds for purchase. Use our mortgage calculator to verify your final payment matches what you expected.
Buyers should not make life or credit changes after their loan is clear-to-close, as these changes could nullify mortgage approval and result in the clear-to-close status being revoked.
Clear-to-Close: A Real World Example
Imagine a first-time home buyer notified that their mortgage application for an FHA mortgage is clear-to-close. This milestone indicates that the lender has completed all necessary reviews and approvals, setting the stage for the final steps in acquiring a home.
The buyer enters a critical phase. Between today and the closing date, they must maintain their financial stability and avoid actions that could affect their creditworthiness, such as making large purchases on credit, changing jobs, or altering their marital status.
Getting a clear-to-close means the buyer can schedule a final walk-through of the property, review closing documents, and wire funds securely to the settlement.
Common Questions About Clear-to-Close
Frequently asked questions about clear-to-close status and what to expect during the final stages of home buying.
