“Closing” in real estate is the process when ownership of the property officially transfers from the seller to the buyer. It’s an exciting moment, but one that’s not well-understood. So whether this is your first closing or your fifth closing (and you’re looking for a reminder!), we are going to discuss what you can expect as both a seller and a buyer.
The Process of Closing for Sellers
As a seller, you generally do not attend the closing. Many times, neither does your attorney, at least not in person. Instead, you meet with your attorney or paralegal ahead of time to sign off on the documents needed for closing. These documents include (among others) the deed and affidavit of title. Then, your attorney will make sure the title company gets these documents. At closing, your attorney attends, either in person or remotely, signs off on the necessary documents, and addresses any final issues that need to be addressed.
Last-minute issues are a rarity, but they may arise if you don’t have a team who proactively looks to help avoid them. This is why it’s important to ensure that your real estate team is thinking ahead and addressing issues before closing. The issues that may arise could relate to the buyer’s final walkthrough or discrepancies regarding the final numbers.
Once the closing is done, the buyer will send you your money. You can choose to have a check sent via FedEx or wired directly to your account.**
The Process of Closing for Buyers
As a buyer, you almost always attend closing in person. If you’re like the vast majority of buyers, you’ve gotten a loan and your lenders require you to be in person to “wet sign” all documents. “Wet signing” means that you make a mark on a physical piece of paper. Obviously, you can’t do this virtually.
Leading up to closing, you will get the “clear to close” from your lender, at which point your closing will be scheduled. Once your closing is scheduled, you will either wire funds or bring a cashier’s check based on the amount that your lender and attorney told you to bring. There can be some last-minute number changes, so we always ask you to bring a little extra and get an overage check. It is better to bring too much and get money back, rather than not bring enough. You must bring a cashier’s check because title companies do not accept personal checks.
Typically the same day as the closing, or the day before, you will do your final walkthrough. This walkthrough is used to ensure that:
- New issues haven’t materialized
- Your requested repairs have been completed
- The property is, in general, what you expect it to be
At closing, you will feel like you are signing the same documents over and over again. And this is somewhat true as the lender wants to make sure your financial circumstances have not changed, that you have fully disclosed your financial scenario, and that you understand your rights and responsibilities. Your attorney will do a high-level explanation of the documents and the next steps.
You should always feel free to ask any questions about anything that doesn’t make sense! It can feel complicated because it is complicated. That is why you have an attorney!
Once all the documents are signed by the buyer and seller, they get sent to the lender and we wait for funding approval. After all the steps and the paperwork, the funding approval can feel rather anti-climatic but trust us, you want it that way.
Finally, you get your keys (either at the title company or coordinated with realtors) and you can move on to your new home or investment property!
Navigating Real Estate Closings
Closing on a piece of property may feel overwhelming. And closing is only one piece of the puzzle when buying or selling real estate! That’s why you have a team to support you. The right attorney will help make this process feel easy and accessible and help avoid any potential issues.
We offer free consultations and would be happy to answer your questions about this process. Give our office a call at 312.905.3013 to talk to us today.
**It’s important to never accept wire instructions over just email, and to always confirm over the phone with the title company**