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What Actually Happens During the Closing Process?

Tari Haberfield
Sep 23 4 minutes read

The closing process is the final step in purchasing a home, but for many buyers, it can seem like a mysterious experience. In reality, closing is a well-organized series of events that, when understood, can help alleviate stress and ensure a smooth transition to homeownership. Let's demystify the closing process and explore what actually happens during this crucial phase of your real estate journey.

Pre-Closing Preparations

Before the official closing day, several important steps take place:

  1. Final walk-through: Buyers typically conduct a final inspection of the property to ensure it's in the agreed-upon condition.

  2. Document Signing:

    This is the heart of the closing process. Each party will sign a multitude of documents, including:

    • The closing statement (detailing all financial transactions)

    • Mortgage documents

    • Property deed

    • Affidavits and declaration

  3. Funds preparation: Buyers arrange for the transfer of closing costs and down payment funds. This can be a cashier’s check or preferably by electronic transfer.

The Waiting Game

The closing process—from “contract signed” to “keys-in-hand”—takes an average of 43 days. Most of the time you’ll spend waiting depends on buyer financing, because that’s the part that takes the longest to come through. Once that’s ready and approved, you’ll move to closing day.

Closing Day

On the day of closing, several key events unfold:

    1. Fund Transfer: For cash purchases the buyer initiates a transfer for the remaining balance of the home's purchase price and closing costs. And for financed purchases, the lender transfers the loan funds. 

     2. Document recording: The closing agent files the new deed and mortgage documents with the local government.

     3. Title transfer: The title company registers the change in ownership.

    4. Funds Disbursement: The closing agent then distributes these funds according to the closing statement, paying off the seller's existing mortgage, real estate commissions, and other fees.

Post-Closing Activities

After the closing meeting, a couple final steps occur:

  1. Key Exchange: the seller hands over the keys to the property, along with any other relevant items like garage door openers or security codes.

  2. Move in: You’re ready to move into your new home. Congratulations!

In conclusion...

While the closing process involves numerous steps and can seem overwhelming, understanding what to expect can help you navigate this final stage of your home purchase with confidence. Remember, your real estate agent is there to guide you through each step, ensuring a successful and exciting transition into your new home.

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