Real Estate Closing - The Basics

If you have never been to a closing you will be surprised by how most of the show goes on without help from yourself. 

The lawyers or real estate agents and the mortgage representative bring in all of the papers necessary to make both 

sides happy - the buyer side and the seller side. Most, if not all, of the details have been ironed out in advance. 

The important documents will include the purchase offer, the title search, home inspection, the buyer's mortgage application and approval. The documents are completed and signed, and the buyer gets the keys.

Most of the time a closing takes place at the office of the title company, and can take as little as thirty minutes to an hour. The buyer attends the closing, and most of the time the seller does as well, however a signature of the seller can be had in advance. 

At the closing itself, the buyer has the opportunity to review the mortgage loan documents in detail, confirming the correct loan amount, payments and detailed closing costs, plus and amounts that need to be held for taxes and insurance. Once confirmed to be accurate, the buyer then signs all the loan documents. 

After this, the buyer will examine and sign the title paperwork, confirming that the deed is recorded in the correct name and form, such as joint tenancy, tenants in common, or community property. Prior to the closing, the title company has completed their title search and has confirmed that the seller holds title to the property, with no liens against it. Where any problems (called defects) exist in the title, which can delay the closing or the sale, the title company informs the seller of these, in writing, at the closing.

If everything is in order, the funds are available from the lender, the title is clear and the deed is properly prepared, the last step is for the closing agent to disburse funds to the sellers in the correct purchase price amount, and then give the keys to the home to the buyer. Sometimes the buyer receives any overpayment for costs of closing, which may have been included in the deposit check.

A buyer should bring everything they have received so far to the closing table. Any documents related to the offer, inspection, sale and the cancelled check for the deposit amounts should be at the ready in case they are unexpectedly needed. The title company as closing agent will have the loan funds already available, and the buyer will need to have one last check, a cashier's or certified check, for the down payment amount. 

Greg Cryns is the owner of Flat Fee Real Estate Guide - http://www.flatfeerealestateguide.com