I also wanted to share how my Mom taught me to finish a quilt with binding. I start off with 2 inch strips that are on the bias. I fold the binding in half and press. So there are no lumps in your binding, I press 1/4" at one end of the bias strip (Note: the bias strips ends are cut at a 45 degree angle). I use a 1/4 inch seam allowance. I sew to 1/4 inch of the corner.
Note: On a large quilt use more pins that I do in the picture. This is only a potholder and not as much pinning is needed. The binding will stretch as you're sewing it on, which is not a good thing. Also make sure that you don't stretch the binding as you're pinning it on. We want our binding to lay nice a flat! Just wanted to add this edit to my tutorial so it will make the job easier. Thank you Irina for calling this to my attention :) This is something I didn't even think of, although I've done the same thing!
When I reach the corner, I make a 45 degree turn and sew off the fabric and backstitch.
I fold the fabric back and down and stitch at the pin which is at 1/4 inch.
Update: When you start sewing again, start at the edge of the fabric and back stitch. I didn't used to do it this way and I know it doesn't make sense, but that was how I was taught. So the picture below should show a line of stitching that is off the fabric and not a quarter inch in.
When I'm at the beginning of the binding, I cut off at a 45 degree slant so there is no bulk. I blind hemstitch everything into place folding all the corners into perfect miters. Thank you mom for teaching me how to do binding the neat and easy way!