Closing on a house can be frightful. But a new home is so delightful. And since we’re all set to go. Let it close, let it close, let it close.
While getting to the closing table isn’t always lively and fun, we still love to get there. There are a few potentially slippery steps from the time you put a warm signature on your sales contract to the handing over of the house keys.
Unless something pops up to put a freeze on the process, these are the basic steps most buyers and sellers will follow for closing on a residential property:
Contract – Buyers and Sellers complete and sign the contract. The agents execute it and deliver it to the title company.
Option Fee – If there is an option period, buyer delivers specified option fee to the seller within 3 days.
Earnest Money – The amount specified in the contract is deposited with the title company listed on the contract within 3 days.
Inspections – Buyer does their due diligence and conducts all inspections of the property before the option period ends.
Information Exchange – Title company, buyer, seller, and mortgage company exchange information needed for the sale. Lack of contact and information can stall the process.
Title Search – Title company researches property records, tax status, maps, restrictions and more. Any liens, judgements or other issues are investigated and addressed.
Mortgage Company – Buyer secures their lender, provides all needed documents and obtains loan approval.
HOA Resale Certificate – If there is a homeowners association, the resale certificate and rules and restriction documents are ordered, paid for and delivered to all parties.
Appraisal – A professional appraisal of the property is performed if required or desired.
Survey – An existing survey and survey affidavit are supplied by the seller or a new survey is ordered. Once received, the title company reviews the survey and determines if it is acceptable for use.
Title Documents – The title commitment, tax certificate, property restrictions, etc. are delivered to the buyer and their lender for review.
Contingencies Removed – Contingencies to the contract in addition to issues on the title are addressed and removed prior to closing.
Clear to Close – Approval to close the sale is given by both lender and title company.
Schedule Closing – An appointment is set up for all parties to sign closing documents.
Final Walk-Through – buyer takes a final look at the property to confirm condition and acceptance.
Signing – Buyers and sellers sign documents to consummate the closing.
Funding – after all required documents are signed, reviewed and approved, buyer delivered funds and lender sends funds to the title company who then disburses monies to designated parties.
Keys and Possession – after funds are processed, buyer gets keys to property.
Deed Recorded, Records Filed – Title company files the deed(s) in county court records and records the transaction.
Title Insurance Policy Issued – Title company issues title insurance policies to buyer/lender.
There is nothing magical about the closing process and there’s nothing really cold or gloomy. But if it goes as planned, all the way home you’ll be warm.
The opinions expressed are of the individual author for informational purposes only and not for legal advice. Contact an attorney for any particular issue or problem.
Lydia Blair (formerly Lydia Player) was a successful Realtor for 10 years before jumping to the title side of the business in 2015. Prior to selling real estate, she bought, remodeled and sold homes (before house flipping was an expression). She’s been through the real estate closing process countless times as either a buyer, a seller, a Realtor, and an Escrow Officer. As an Escrow Officer for Allegiance Title at Preston Center, she likes solving problems and cutting through red tape. The most fun part of her job is handing people keys or a check.