Closing (Real Estate)

Closing (called settlement in several parts of the United States)

The last step in the process carrying out a real estate sale. This date for closing is chosen during the negotiations stage, and is normally providing for several weeks subsequent to the contract being ratified in writing. On the date of closing, all parties complete the purchase agreement, and property ownership is handed over to the new buyer. In most regions ownership officially changes hands when the deed is recorded County Recorder's office in the county where the property is situated.

A number of things occur during closing:

The purchaser (or the purchaser's lender) delivers funds (In the US, generally a Cashier's check, bank draft or wire transfer of funds) for the remaining balance due on the purchase amount. The seller signs a notarized deed into the name of the buyer, and provides him with the keys. An attorney civil law notary or escrow company causes the new deed to be recorded with the county recorder with jurisdiction over the property. The seller is issued a check in the amount of the sale proceeds, less any closing costs and loan payoff. In the western portion of the US, escrow closing usually happens when an escrow company (instead of an attorney) or other party entrusted with the monies and the notarized deed, orchestrates the transfer. This principally happens allowing the seller to hand over property ownership, and letting the buyer hand over the funds, without buyer and seller having to be in attendance simultaneously. Escrow ensures an organized sale, or if things go wrong, an organized cancellation of the contract.

In the Eastern part of the United States, settlement (as they call closing) happens at place and time which all parties (that usually include all participating agents) have meeting at a settlement organization supervised by or presided over by a settlement agent or lawyer. At such occasion, the settlement agent distributes all monies recorded on the settlement accountnt  (in the manner of bank certified or wire transfer of funds) allowing the settlement to take place, and then the deed is recorded by the settlement company. Feb 2, 2011

Suggested Reading

Facebook Comments