The first pictures are emerging of the harrowing sight of five coffins at the Holy Family Church, in the Ballymagroarty area of Londonderry.
Mourners at the funeral have been asked to salute the bravery of former footballer Davitt Walsh who swam out into the harbour in an effort to save the six occupants of the Audi Q7.
It is understood the vehicle lost grip on a thick blanket of algae coating the slipway and slid into the water.
Mr McGrotty handed his baby to Mr Walsh through the broken driver’s side window just moments before the vehicle sank.
Father Paddy O’Kane told the funeral service: “Davitt, today we salute you as our hero.”
The priest also revealed Louise James’s words to Mr Walsh and his girlfriend, Stephanie Knox, who stripped the infant and warmed her at the shore, when they met at the parochial house on Tuesday.
“Don’t blame yourself that you did not do more - we are so grateful for what you did,” the priest said Ms James told the couple.
“It could easily have been seven deaths, not five.”
Fr O’Kane revealed that when the grieving mother also gave Mr Walsh her baby to hold at the meeting, she opened her blue eyes, smiled up at him and gave a big yawn.
The priest also praised those who raised the alarm and the emergency services who, he said, did all they could.
Mourners heard that the family has suffered other losses with another of Ms James’s sons, Joshua, only living for 17 hours and Mr McGrotty’s younger sister, Ann, dying from cancer last July.
“You are just going to have to wait a little longer until you get that tight hug promised to you from Evan,” Fr O’Kane told Ms James.
Mourners also heard that the mother had raised £16,000 for a charity which helps people with muscular dystrophy, including doing a tandem parachute jump from 14,000ft (4,267m).
Investigations into the cause of the tragedy are continuing, with the pier shut to vehicles.
Bishop of Derry Donal McKeown told the service that love and life are stronger than death and the bitterest tragedy.
“These have been sombre days, not only in this city but right across this island,” he said.
“The banks of daffodils seemed to wave naively in the face of the horror that happened in a few minutes on an apparently harmless pier at Buncrana. And the news of the awful events in Brussels underlined just how fragile life can be.”
Bishop McKeown also praised the response of the community in Derry.
The service was also attended by Church of Ireland Bishop Ken Good, Commandant Louise Conlon, representing Irish President Michael D Higgins, Kieran Carey, representing Acting Taoiseach Enda Kenny, and Northern Ireland Deputy First Minister Martin McGuinness.
Earlier he met the family with Northern Ireland First Minister Arlene Foster.