I do a ladder stitch to close it up and then top stitch. Another way of doing it if you are doing an applique is to apply your applique at the end. With this you stitch all around the outside edge of the potholder, make a slit in the fabric where you are going to apply the applique and turn the potholder through that slit. Once it is turned and pressed then apply your applique which covers the slit. I usually use a blanket stitch around the applique which I have fused on. This also works as quilting to hold all the layers together.
Another way I finish potholders is to make the backing larger than the front and bring it around to form a binding. You can either hand stitch it or machine stitch it which is what I do. I hand stitch the corners together. Here is a short video on how to do that
https://www.youtube.com/watch?v=npTvVGouO6Y but there are other links as well.