The Closing Process
The Closing Process
Closing the real estate transaction is basically the investigation made or
actions taken by either a title agent or title attorney before the actual
issuance of the title policy. There are six basic steps that usually followed in
somewhat the same order in every real estate transaction. Although it is not the
job of the title agent or title attorney to cure defects in or problems with the
title to the property or perform escrow or other services outside of closing the
transaction, title agents and title attorney help in these matters on a somewhat
Opening the Title Order
A “sales” contract (agreement of sale) starts the process.
Processing the File
Processing the file is when tax information, loan payoffs, survey if
necessary, homeowner/maintenance fees, inspections/reports, and hazard and other
insurances as well as legal papers are ordered and title commitments/preliminary
reports are reviewed and sent out.
Search made of the public records. Records searched include deeds, mortgages,
paving assessments, liens, wills, divorce settlements and other documents
affecting title to the property.
Title examination is the examination of the documents found during the title
search that affect the title to the property. This is when verification of the
legal owner is made and the debts owed against the property are determined.
Document Preparation and/or Request to Produce
Review lender instructions/ requirements, review instructions from other
parties to transaction, review legal and loan documents, assemble charges, and
prepare closing statements and set closing.
Settlement/Closing the Transaction
Escrow/Settlement officer oversees closing of transaction. Seller signs deed,
buyer signs new mortgage, Old loan is paid off, new mortgage is signed. Seller,
real estate agents, attorneys and other parties to the transaction are paid.
Documents are recorded in the county in which the property is located.