What is a real estate closing?
Ok, you have signed the Purchase & Sale Agreement, all contingencies are satisfied and now it’s time for closing. But what is a real estate closing? Well, your real estate market may do it differently, but I will give you an idea of how most closings happen in the Greater Nashville area.
A title company gets all the contract documents from the two parties. If you are using a Realtor, they will handle this for you. The title company works behind the scenes to handle all of the legal work, but, in a nutshell, they make sure all the liens are paid off and that the contract is followed as it is written.
In our area, it is very common for the Buyer and Seller to have different title companies and they perform their “closing” at different offices, at different times. A lot of clients will ask me if the buyer or seller will be in the same room. Most of the time, the parties never even meet.
The Buyer is entitled to do a final walk-through of the property before closing. This is done to check for any repairs that were to be done and to make sure there has been no damage to the property. Basically, the house needs to be in as good or better shape than when the contract was signed. Typically, the final walk-through is done 1-2 days prior to closing. In a perfect world, the Seller would have everything out of the property so the Buyer can see everything. The world is not always perfect, however. A lot of times, the Seller will still be packing up to move when the Buyer walks through. This can cause stress for both the Seller and the Buyer. The Seller feels the pressure of getting everything out of the house and the Buyer feels anxiety about the Seller having everything out of the house and it being ready for them to move in. Unfortunately, I have had one too many experiences where the moving out doesn’t go quite as planned. I say this as a caution, because if at all possible, it is always best to have everything out of the house the day before closing. Moves almost always take longer than anticipated. The movers were supposed to send four men and two trucks and someone doesn’t show up for work and a truck breaks down. Yep, this stuff happens. I have seen people moving out until midnight, people having to get hotel rooms at the last minute, pay for extra storage days, have to do repairs at the 11th hour, and experienced the myriad of emotions that go along with all of those issues.
The actual closing – the signing of the documents – is typically the easiest and least stressful part of the whole transaction. The Buyer goes to their title company with their representative and signs the closing documents that state that they are buying the property – either with a loan or with cash. The Seller signs the closing documents that they are transferring their property to the new owner at their title company with their representative. The title companies exchange documents and money is transferred. The Buyer gets the key and now owns the property.
That is a very typical, simple explanation of a real estate closing. There are many variables based on the contract and what the parties agree to. I hope that all of your real estate closings are easy, uneventful and that no one leaves last week’s pizza in the refrigerator!
Michelle Froedge is a residential Realtor and Principal Broker in the Greater Nashville and Williamson County areas of Tennessee. “Mom” to four-legged fur baby, Tyler, Auntie to Zelamie, she is a vegetarian and sings in her spare time. Michelle has lived in Nashville and Franklin since 1997 and has been selling homes since 2004.