What Happens at the
Closing
The simple answer is that the Purchaser gives money to the
Seller and the Seller gives a Deed to the Purchaser.
Of course there is a little more detail than that, so here
goes.
Let’s start with who
will be there.
1.
Seller
and his/her/their attorney
2.
Purchaser and his/her/their attorney
3.
The Title Closer
4.
The Lender’s attorney
5.
Real Estate Brokers
6.
Representative from the Mortgage Broker
There are a few exceptions to this rule. Sometimes the Seller can’t be there and his/her
attorney is there on their behalf with a Power of Attorney.
It is possible there is no lender.
The Real Estate Brokers may not be there, but they usually
are so that they can pick up their commission checks.
The Mortgage Broker may not be there.
Where will the
Closing take place?
If there is a lender involved then the closing will most
likely be at the office of the lender’s attorney since they have the money.
If there is no lender, most likely at the office of the
Seller’s attorney.
But, it can be anywhere that is convenient for all parties.
How long will it
take?
That is impossible to say.
I’ve never had a closing take less that one hour. If there is no lender then the process is
much quicker. If there is a lender, the
average is about two hours, but I’ve had them take three or four.
Why so long with a
lender?
If there is a lender involved, the Purchasers have to sign
all the mortgage documents and that is often a stack 2 – 3 inches high. Their attorney will review each document and
explain to the Purchasers and they will sign.
It can take a while.
Then once the papers are signed, the lender’s attorney must
send some of them by fax or email back to the lender for approval. So everyone has to wait. Once the approval comes, the lender will send
the money to the lender’s attorney’s bank account by wire transfer. So everyone has to wait. Once the funds are in the account, the lender’s
attorney writes the checks, and if some need to be certified or bank checks,
someone has to take then to the bank get them.
So everyone has to wait. Finally
they lender’s attorney can hand out the checks and the closing will be
complete.
So what actually
happens?
The quarterback of the closing is the title closer. He or she will be responsible for making sure
the deed is correct, filing the deed, mortgage, and transfer tax forms, paying
off the Seller’s mortgage and issuing the title insurance policy. They also act as Notary Public for the closing.
The Seller’s attorney will have prepared the deed and other
transfer documents in advance and circulated them among the title company and
other attorneys. The Seller will sign
the deed and transfer documents and they will be passed on to the title closer
for approval.
Meanwhile the Purchasers are busy signing all their
loan/mortgage documents. The ones that
need a Notary go to the title closer, then all go to the lender’s
attorney. The Purchaser’s attorney will
be explaining all this paper to the Purchasers and making sure they sign in all
the right places.
The Purchaser and Seller’s attorneys will discuss any other
issues that may have arisen, like adjustments of property taxes, fuel oil and
so on. Any issues that may have arisen
during the walk through, like damage or broken appliances or a mess left behind. They will come to an agreement with their
clients and discuss the final numbers for the closing. Generally they will have worked this out in
advance and there shouldn’t be any changes.
The lender’s attorney has been reviewing the loan documents
and sent them off to the bank for approval, gotten approval and received the
wired funds and cut the checks and gotten them certified.
The Sellers hand over the keys and garage door openers.
The lender’s attorney hands out checks to the Sellers, the
title closer, and the real estate brokers.
If the Purchasers have brought additional funds, they hand that over to
the Seller and the title closer gives the Purchaser a copy of the deed. The original deed will be filed with the
county clerk and returned to the Purchaser’s attorney. The title closer will give the Purchaser’s
attorney the title insurance policy.
Everyone shakes hands and the Closing is complete.
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