Once the seller accepts the contract, the countdown to closing begins. The buyer must tender the earnest money deposit proscribed in the contract to the escrow agent, settlement agent, or real estate broker, who will see that it is promptly deposited into an escrow account where the funds are held until the time of closing. Timing is essential to make sure all the ingredients for a successful closing are in place for your arrival. In some parts of the country, the settlement agent is an attorney, title company, or escrow company. In Florida a closing can be conducted by and attorney or a title company. Once a settlement agent has been selected, he or she will handle the closing process from there.
There are many tasks performed behind the scenes to complete the settlement of your real estate. This section is designed to educate you on those tasks so you can anticipate what is needed, when it is needed, and the potential issues that can delay your closing. When we receive your contract 3-4 weeks before closing a “Seven Step Process” begins:
We will request contact information from all concerned parties: buyers, sellers, lenders, realtors and any other interested parties and the title search is ordered. Our insurance underwriter First American Title Insurance Company, hereinafter “Underwriter”, has a team of title examiners who review the title to your property at the courthouse, researching ownership and chain of title, payment of real estate taxes, any lien of record, and the legal description.
Step 2 - Preliminary Title Work:
The Underwriter reviews the title search and any clouds on the title, such as judgments, IRS liens, unreleased mortgages, and ownership claims are identified for correction prior to the settlement. The Underwriter will provide to us the title search as well as a commitment to insure, called a title insurance binder, to be forwarded to the buyer and their lender so as to advise the status of the title to the property.
Step 3 - Review Title & Instructions:
We review the title search and commitment, the survey (if provided) and contract to determine potential risk in the transaction. Our staff in turn will receive written closing instructions from your mortgage company regarding their requirements and the terms of your loan. We will contact you and the other parties in the transaction to confirm the date and time of closing, and will walk you through the rest of the settlement process to the day of closing.
Step 4 - Build The File:
We then begin to draft or accumulate all of the other documents, required or requested, for your closing such as the deed, preliminary accounting statement (called the HUD-1 settlement statement), promissory note, mortgage, survey, termite letter, inspection reports, seller mortgage payoffs, repair bills, and homeowners insurance. Many if not all of these documents are emailed or faxed to your lender for their review and approval.
Step 5 - Closing Logistics:
Once the lender gives final approval to close, they will send us the loan documents for signing and final adjustments to the HUD-1 settlement statement. This normally takes place the day before or of the scheduled closing. Our staff will call or email to confirm the time of closing and give the buyer a final amount for their cashier's check.
Step 6 - The Closing:
The sellers come in and sign their documents either the day before or early the day of the closing - normally a 30 minute appointment. The buyers follow at their appointed time, with their closing usually taking 30 minutes to an hour. If a buyer or seller is unable to attend the closing at our office their document package will be either emailed or mailed via overnight express mail to be returned via overnight express. Once all the documents are signed and in hand and the buyer’s closing funds have been received and confirmed the buyer is the new owner!
Step 7 - Post Closing:
Funds are disbursed and all parties receive their checks. Signed lender documents are returned to the lender. The deed, mortgage and any documents required to clear title to the property, if applicable, are sent to the courthouse for recordation. Subsequently the owner’s and lender’s title insurance policies are forwarded to the buyer and lender.
