Closing & Escrow
What is a closing?
The final step in a real estate deal is the closing, which marks the completion of the transaction. On this day, money (and sometimes keys) are exchanged between the parties, and the buyer officially becomes the owner of the property.
What Can I Expect at Closing?
Most closings typically involve two main steps: finalizing the real estate purchase and securing the mortgage loan that finances it. During this process, deeds, mortgages, and other important documents are signed or transferred. A closing agent, who remains neutral, oversees the entire process, holding the legal papers and funds for the buyer, seller, and, in some cases, the lender. The agent ensures all documents and funds are distributed according to the lender's instructions and that both the seller and buyer fulfill their part of the sales contract.
What Should I Bring to a Closing?
A valid (not expired) government-issued ID that includes a photo, such as your driver’s license or passport. The only payment methods allowed are certified funds and wire transfers. Certified Funds in the form of a cashier’s check or money order should be made payable to Brabazon Title Team Group. A wire transfer directly to our escrow account is also acceptable. Please contact your closing agent for wiring instructions. If there is a lender, all parties involved in the loan must attend to sign the loan documents.
How Long Will Closing Take?
Most closings typically last around an hour, but this can vary. Closing on a property is a significant event; it shouldn’t be squeezed into a lunch break. Make sure you have enough time in case the process takes longer than planned.
What is Escrow?
When buying a home, your purchase agreement typically includes a deposit, commonly referred to as earnest money. This deposit demonstrates to the seller that you are serious about purchasing the home. If the deal falls through due to the buyer's fault, the seller usually keeps the earnest money. If the purchase is successful, the deposit is applied toward the buyer’s down payment.
An escrow account is established to safeguard both the buyer and seller by holding the earnest money deposit, which stays in the account until the transaction is finalized.
Sometimes, funds are kept in a different type of escrow account after the sale is finished. This is known as an escrow holdback. There are various reasons why an escrow holdback might be necessary. For instance, it could be because you agreed that the seller may stay in the home for an additional month, or there are unpaid bills on the property that the seller must settle, such as a water bill.
If you’re building a new home, money might stay in escrow until you’ve approved all the work. Once the conditions are satisfied, the funds will be released to the appropriate party.
