Closing
Definition and meaning of Closing in real estate.
Closing is the final step in a real estate transaction where the property title is officially transferred from the seller to the buyer and all funds are distributed. This event typically involves signing various legal documents, paying closing costs, and recording the deed with the local government.
In more detail
During this process, the buyer signs their mortgage agreement and the deed of trust, while the seller signs the deed transferring ownership. A settlement agent, often a title company representative or attorney, oversees the transaction to ensure all contractual obligations are met. The lender releases the loan funds, which are then used to pay off the seller's existing mortgage and distribute transaction fees.
Once the transaction is finalized and the deed is recorded, the buyer receives the keys and takes legal possession of the property.
Key facts
| Category | Legal, Titles & Closing |
|---|---|
| Also known as | Settlement |
| Typical timing | 30 to 45 days after contract signing |
| Who pays | Both buyers and sellers have specific closing costs |
A buyer sits with their real estate agent and a closing agent at a title company office to sign the loan documents, pay their down payment, and receive the keys to their new home.
Frequently asked questions
How long does a closing meeting usually take?
The meeting typically takes one to two hours, during which the parties review and sign a large volume of legal and financial documents.
What happens if there is a delay in closing?
Delays can occur due to mortgage underwriting issues, title problems, or repairs not being completed, which may require an extension of the contract.
Related terms
Sources & references
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