Real Estate Closings

Real Estate Closings Part 1

Overview:
A proper understanding of real estate closings is essential to being successful in sales at Streetvestor. Closings are not glamorous. The best closings are the ones where nothing out of the ordinary happens and there are no surprises. When you carry out a great closing, no one will even notice. When you let just a couple of details slip for a closing, everyone will notice and they will not be happy. It is your job to make the closing process an afterthought in the mind of our clients and those who sell us property.

What is a Closing?
A Closing is the term used to describe the event at which a transfer of title to a piece of real estate is executed. For the sake of this lesson, when we are referring to a “closing” we are referring to the entire process of dealing with the buyer, seller, bank, and attorney to convey a property from a seller to a buyer. This closing will take place at the office of a local attorney.

Real estate is conveyed by deeds, certificates of ownership, that are recorded at the county courthouse. Different from cars, where the owner or lien holder holds the deed, in real estate the local government oversees the record of title. In most sales of any other product there is no certificate of ownership. When you buy a stereo, you pay for the stereo and the seller gives you the product. Because real estate involves such a large amount of money and therefore risk for the buyer, the local government keeps on file who owns the property so that a buyer is sure that they are actually dealing with the owner of the property.

There have been several court cases where someone claiming to be the owner of a property sold the property to an unsuspecting and naïve buyer without using an attorney to check at the county courthouse. As it turned out, the “seller” was actually a con artist who would find vacant properties and “sell” them in such a fashion. Although the buyer was able to sue the con artist, he had absolutely no claim against the true owners of the property. For reasons such as this and to ensure that all of the legal details are handled correctly, BD typically closes all of its deals at an attorney’s office. There will be a few exceptions, but the vast majority of all closings that you are involved in will be watched over by an attorney.

The parties to a closing are typically a buyer and his or her agent, a seller and his or her agent, the attorney, the lender, and the insurance agent. Each of these parties has a role to play in putting together a real estate closing although the lender and the insurance agent typically are not present at the closing. Typically a buyer will meet the seller at the attorney’s office and sign paperwork as instructed and organized by the attorney. The attorney holds all of the money in an account and then cuts checks to the appropriate parties when all of the paperwork is finished.