Escrow & Closing
Frequently Asked Questions
A real estate closing is the final step in a real estate transaction where the property is transferred from the seller to the buyer, and the buyer pays the remaining balance owed on the purchase price.
At a real estate closing, the buyer and seller sign all of the necessary paperwork, including the deed and the mortgage loan documents. The buyer pays the remaining balance owed on the purchase price, and the seller transfers the title to the property to the buyer. The closing agent or attorney will also disburse funds to pay any outstanding fees, such as real estate commissions or taxes.
The escrow company is a neutral third party responsible for preparing documents necessary to transfer clear title to the buyer, recording the mortgage and making sure funds are transferred to the seller. The escrow process begins when your earnest money is deposited and the purchase and sale agreement is delivered to the escrow company and ends with the closing of the transaction.
Title insurance insures the lender and/or buyers against the possibility of unknown liens or discrepancies in ownership on the property they are purchasing. Sellers buy title insurance for the buyers, covering the amount of the purchase price; buyers buy title insurance so their lender will be covered for the full value of the mortgage. This is a one-time fee that is paid at closing.
Typically, if the buyer is taking a loan to purchase your home, the escrow process takes around 30 days to complete. If the buyer is purchasing the home in cash, the transaction can be as quick as 7 days.
The possession or turnover date is defined in the purchase agreement, and usually occurs the same day escrow is closed and the legal ownership of the property is officially transferred to the buyer. In some cases, the buyer can offer or the seller can negotiate a “Rent- back” period. This is a mutually agreed period of time after the sale officially closes for the seller to remain in the home to move out and clean. The legal relationship between buyer and seller would then officially convert to a landlord/tenant relationship.
Your sale proceeds are typically available to you within 1-2 business days after the closing is official. The escrow company will either send you the sale proceeds via wire transfer or you can pick up a check from their office.
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