Closing involves the final settlement of the terms and conditions pertaining to a property sale. This is set during the negotiating phase of a property transaction, and is usually held some weeks after an offer is accepted by the seller.
The Role of the Real Estate Purchase Agreement
The contract involved in the proceedings is called a ‘real estate purchase agreement’ which includes the terms of the sale and the steps that have to be completed beforehand. This includes the documents that need to be exchanged with the seller to transfer the property legally.
As a buyer, you have a lot to lose if this process does not go as planned. While the property is in escrow or closing, you have to coordinate with the other people involved to acquire an appraisal of its value. This also includes an inspection that will determine the condition of the premises.
The document should also clarify what the buyer and seller need to pay for. For example, as the buyer, you need to pay for the deed record, insurance, and any costs that finance the property. The seller, on the other hand, has to pay for the title report and the deed that is to be prepared to transfer the title.
Location of the Closing
The closing is usually held at the office of the company that is issuing the title for the property. However, it can also be held at the office of one of the attorneys. The seller may or may not attend or they can sign the documents beforehand. They can also give their attorney the authority to sign in their stead during the closing.
Be prepared to face some delays if anyone from the party is unable to make it to the closing on a fixed date.
Paperwork and Process
There is significant paperwork involved during the closing process. The escrow company will have the documents on hand, and ready to be signed. As the buyer, be prepared to sign 10 or 30 more documents than the seller. Click To Tweet This includes the mortgage documents, tax records, and legal disclosures among others.
Either you or the lender working for you will hand over the check for the amount that is owed to purchase the property from the seller. After that, the seller will sign a deed over to you transferring ownership as well as the keys to the property.
The lawyer or title company will then register that deed with the relevant government office. At that point, your name will be recorded as the new owner of the property. The proceeds from the sale will go to the seller after the closing costs and remaining mortgage balance are taken care of.
During the closing, you will also have to show documents proving that the property is insured and has been inspected. In addition, you may have to bring a check covering the closing costs involved or have the money wired to a pre-determined account.
Make sure to bring copies of all of the documents you received during the purchasing process, such as a copy of the contract as well as government issued identification.
Missouri 48 Hour Pre-License Basic Package
Become a pro at the closing process as a real estate agent in Missouri by signing up for 360Training.com’s Missouri 48 Hour Pre-License Basic Package. Learn all you need to know about property rights, ownership transfer, contracts, deeds, appraisal, leasing, and fair housing, among other essentials. Get a complimentary exam prep course to prepare for the licensing exam.
The main aim of the Missouri 48 Hour Pre-License Basic Package is to prepare students for the licensing exam held in the state. Without the license, you will not be able to work as a real estate agent in Missouri. The course covers the following topics in detail:
- Marketing regulations
- Agency relations
- Documents required in the closing process
- Significance of a Missouri real estate license
- Property management essentials
- The finances involved in real estate
- Land use and property ownership
- Calculations involved in real estate
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