In your area the process may be called settlement, transfer, closing escrow, or passing papers. It may be held in the county courthouse, the lending institution, a title company, a real estate office, or an attorney’s office. No matter what terminology is used, it’s the fruit of everyone’s labors and the time when the transfer of ownership finally takes place.
What does a typical settlement look like? In one city, buyers, sellers, attorneys, brokers, and a paralegal from the lending institution may gather around a long table. In another area, there may not be a meeting at all; details are handled by mail, courier, or electronically through an escrow company. In no aspect of real estate does local custom vary more.
Whatever the practice, however, the skeleton of the transac¬tion remains the same:
1 The seller proves marketable title.
2 The buyer pays for the property.
3 The seller delivers the deed.
If new financing is involved, settlement includes the signing and delivery of a bond and mortgage or, in some states, a trust deed.
The deed is a bill of sale for real estate. You do not want to sign and deliver the deed until you receive your money. The buyers, on the other hand, cannot pay you until they receive their mortgage loan. The lender will not turn over the money without receiving a mortgage. But the buyers cannot sign a mortgage until they own the property. It is obvious that the various transactions must take place at one time and in precise order.
If it is customary in your area for the seller to attend the closing and you are unable to do so, arrangements can be made for you to sign the deed ahead of time; this one act is your major contribution to the ceremonies. In many eastern states, it is at this point that front-door keys may also be handed over. In other areas, buyers must wait to hear that they are “on record” (the deed has been entered into the public records) before getting the keys, garage door openers, and security codes for the house.
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