Real Estate Closing Process
We understand that a title transfer can be stressful and that the paperwork and information requests may seem overwhelming at times.
We designed our residential title services and real estate closing around your peace of mind. We are here to help!
Main Title Transfer Tasks
Southern Title is the facilitator of the entire real estate closing. What appears from the outside to be simply a group of people sitting around a table signing a very large stack of papers in an office is, in fact, a very complex process that requires a large number of interactions with many different groups, from bankers to termite inspectors, researchers in area courthouses to local real estate agents, to make the stack of papers ready for signing.
This process can vary between one day and many weeks, depending on how many issues require resolution and the speed of the resolution in each case.
Learn all about house closing process in our ultimate guide to the real estate closing process.
SOUTHERN TITLE BRINGS ALL OF THE INFORMATION TOGETHER FOR A SUCCESSFUL REAL ESTATE CLOSING
Buyer wants to make an offer on a property.
Buyer completes a purchase agreement / sales contract.
Buyer / Buyer's Agent or Seller contact Southern Title to schedule a closing.
Southern Title contacts the relevant people to make the transaction work.
Buyers, Sellers & Agents come to Southern Title and transfer the property title.
1. Starting the process
An escrow or sales contract (agreement to close) starts the process by opening a title order that is then processed. Relevant tax information, loan payoffs, surveys, homeowner/maintenance fees, inspections/reports, and hazard and other insurances as well as legal papers are ordered and title commitments/preliminary reports are reviewed and sent out.
2. Title search and examination
Public records, such as deeds, mortgages, paving assessment, liens, wills, divorce settlements and other documents affecting title to the property, are searched. Title examination is the examination of the documents found during the title search that affect the title to the property. This is when verification of the legal owner is made and the debts owed against the property are determined.
3. Document preparation and/or lender request for title
Review lender instructions/requirements, review instructions from other parties to transaction, review legal and loan documents, assemble charges and prepare closing statements and set closing.
4. Settlement/closing the transaction
Escrow/settlement officer oversees closing of transaction. Seller signs deed then buyer signs new mortgage. Old loan is paid off and new mortgage is signed. Seller, real estate professionals, attorneys and other parties to the transaction are paid. Documents are recorded in the county in which the property is located.
After the signing has been completed, the title agent will forward payment to any prior lender, pay all parties who performed services in connection with you closing, and pay out any net funds to the seller before recording the documents with the county. This all happens without any needed involvement from the buyer or the seller.
- Remember that when you are buying or selling a property, you are changing the legal owner of the property (that’s the essence of a title transfer).
- During the process, any error will cost you time, money and stress if it is not handled correctly. Trust us to make your closing hassle-free.
- Verifying that all of the legal, tax, mortgage and insurance issues are cleared for your real estate title transfer is our business – and we excel at it.
The Patriot Act requires that we collect a photocopy of your valid government issued picture I.D. such as a Driver’s License, Passport, or Military I.D. Additionally, if you are bringing money to the settlement these funds will need to be “certified funds”. Certified funds can come in the form of a cashier’s check, teller’s check, money order, or certified personal check. Cash is only acceptable in small amounts. Please call our office in advance if you intend to bring cash to the settlement. Your lender will require that the purchaser bring proof of homeowner’s insurance. Your lender may also require a current Wood Destroying Insect or Termite Report. You may also be required to bring additional documents which our office will inform you of in advance.
While the time of a settlement can vary greatly, typically a refinance will take about 30 minutes and a purchase will take about 45 minutes.
If purchasing, you should contact Southern Title as soon as you have a signed contract. By contacting us as early as possible, you allow us adequate time to obtain a title abstract on the property being purchased and clear any outstanding “clouds” on title prior to your contracted settlement date. Additionally, we can better coordinate the settlement with all parties involved including the sellers, purchasers, real estate professionals, and lenders.
If refinancing, you should contact us after you submit your loan application. Do not wait for final loan approval, as the time between your loan approval and settlement is often only a few days. By scheduling with us early, you allow us time to obtain the title abstract and clear any issues with your title, obtain payoffs from your current lender, and coordinate closing with your new lender.
In certain circumstances, a “power-of-attorney” can be prepared for you. A “power-of-attorney” is a legal instrument which allows another to sign legal documents on your behalf. Please give us a call to discuss this if you will not be able to attend.
At a “purchase settlement,” typically the sellers, purchasers, and their real estate professionals will attend the closing, which will be conducted by one of our competent and experienced attorneys or settlement officers. At a refinance settlement usually only the borrowers and our attorney or settlement officer are present.
Because we rely on third parties such as lenders to provide us with instructions, information, and figures for your settlement, we often cannot furnish to you the exact amount you need to bring to closing until the day before, or, sometimes, even the day of settlement. However, you should be able to rely on your lenders or your realtor’s good faith estimate for the approximate amount of money you need to bring with you. If you happen to bring too much money to settlement, we refund back to you any excess amount upon completion of the closing. Obtaining your insurance early will assist the lender in determining escrows which can speed up the ability to provide an accurate settlement figure.
While simple real estate transactions may be handled without a lawyer, you may want your own attorney to clarify any terms that are unclear to you in any documents you are being asked to sign. You may also need sophisticated tax or real estate advice for more complex real estate transactions.
A HUD-1 Settlement Statement is a government-regulated form provided by the title company (closing agent) that itemizes all fees and charges for the buyer and seller and gives full disclosure of all monies involved in a real estate transaction. Some of these fees and charges might include: contract purchase price, agent commissions, lender fees for the loan, insurance, title company charges, abstract of title, property taxes, surveys, and recordation fees. The settlement statement outlines your debits and credits and provides each party with a “bottom line” figure. For a more detailed description of the HUD-1 Settlement Statement see this link.
A properly filed Homestead Exemption reduces the amount of money homeowners must pay for their annual property taxes. The homestead exemption of each Parish varies, but filing for one can save hundreds of dollars. Property owners are allowed only one homestead exemption – for their primary residence. Homestead Exemptions on investment property are not allowed.
To file for the homestead exemption, bring a copy of the recorded Act of Sale where you acquired your home to your Tax Assessor’s Office. Filing for the exemption is done in person the first time. Either you or your spouse can do it – it is not necessary for both of you to be there. Each year thereafter, a postcard is mailed to your home for renewal.