The closing process is often seen as the final hurdle in real estate transactions, but it doesn’t have to be daunting. Whether you’re buying or selling, understanding the steps can help you navigate with confidence.
1. What is Closing?
Closing is the final step where ownership of the property is officially transferred. For buyers, it means receiving the keys. For sellers, it signifies receiving payment and finalizing your responsibility.
2. The Role of Escrow
Escrow acts as a neutral third party that holds funds and documents until all terms of the contract are met. Both buyers and sellers will work with an escrow officer.
3. Home Appraisal and Inspection
Buyers need to ensure the home’s value aligns with the purchase price through an appraisal. Inspections are also vital for uncovering potential issues that might need addressing.
4. Title Search and Insurance
A title search ensures there are no liens or legal issues tied to the property. Title insurance protects buyers and lenders from future claims.
5. Closing Costs
Buyers and sellers must be prepared for closing costs, which can include agent commissions, loan fees, taxes, and more. Review the closing disclosure carefully.
6. Final Walkthrough
Buyers should schedule a final walkthrough to ensure the property is in the agreed-upon condition. Sellers should ensure all negotiated repairs are complete.