What is a closing?

    Whew – You finally found the one. highlighted mortgage document and house keys

    The contract is signed, you’re thinking about paint colors, new furniture or maybe all the great dinner parties you’ll have with your friends in your new home. There is so much to be excited about, but before you can start hanging curtains, you need to get to the closing table to finalize the deal.

    What is closing?

    In it’s simplest terms, closing is the point where the seller passes over the title to the buyer in exchange for the buyer’s payment of the agreed upon purchase price.

    The closing is usually performed by a settlement agent, or real estate attorney 30-60 days after the purchase agreement is ratified.

    But, what happens at closing?

    Remember, the main purpose of closing is to transfer title to the buyer and disburse the funds to the seller, but there are several other expenses that must be allocated to various parties in the process. These include (but are not limited to):

    • Taxes that the seller pre-pays must be reimbursed by the buyer
    • Broker’s commissions
    • Attorney’s fees (i.e. for running title search and preparing the deed)
    • Recording expenses
    • Transfer tax
    • Title expenses
    • Loan fees
    • Tax reserves
    • Insurance reserves
    • Appraisal fees
    • Survey fees
    • Work performed on the house (i.e. Termite inspections/treatments)

    All of these expenses can be found on a document called the Closing Disclosure. It is a detailed record of all the cash received, all the charges and credits made, and all the cash paid out in the transaction. Closing statements are prepared by the settlement agent or an attorney.

    That seems like a lot

    If you’re getting overwhelmed, don’t be. Your Abbitt REALTOR is right by you the entire way and will guide you through the entire process. Your REALTOR, settlement agent or attorney will be able to answer any questions you have . . . except what color to paint that new family room.
    tions you have . . . except what color to paint that new family room.

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