What to expect at closing
The closing, also called settlement, is the last step in buying and financing a home.
In most real estate transactions, two closings take place at the same time.
The buyer’s mortgage loan closes and the funds are disbursed. The seller pays off any mortgages and receives the sales proceeds.
The sale closes and the seller transfers the title. In essence, the seller transfers the real property ownership to the buyer according to the terms and conditions in a sales contract or escrow agreement.
Closing is typically held in an office with the attorneys for the buyer and seller, the real estate brokers or agents for both seller and buyer, and a closing agent, who usually works for the title insurance or escrow company. The attorneys and escrow agent transfer money and documents so that you can transfer the property deed and keys to the buyer, pay off all loans that you are still carrying on the house, and pay all of the parties involved in the sale and closing.
Common seller’s closing costs, after paying off your mortgage and and other loans on the property, include sales commission to the real estate agent, title insurance for the new owner and government transfer taxes, and any credit you’ve offered the buyer toward closing costs.