Closing or Settlement is the final step in executing a real estate transaction.
The closing date is set during the negotiation phase, and can be very soon after the offer is formally accepted or it can be set for some time and date in the future (weeks or months). On the closing date, the parties consummate the purchase contract, and ownership of the property is transferred to the buyer. Ownership is officially transferred when the Deed is executed. The Deed is then recorded with the Chancery Clerk in the county in which the property is located.
Several things happen prior to a typical closing:
The contract is sent to the closing attorney and a date and time is set for the closing. Title to the property is examined to determine if any liens, encumbrances or title issues exist. Payoffs of any liens or mortgages are ordered and all title issues are resolved. The new lender is sent a commitment for title insurance. Information and documentation regarding things such as hazard insurance, property taxes, termite certificate, home warranties and home association dues are obtained. The lender sends a package and a settlement statement is prepared and faxed to the principals to review.
