Residential Real Estate Closings
LexLawLawyers work diligently to represent clients buying and selling homes. Buying and selling your home is one of the most important financial transactions of your life. LexLawLawyers can help you navigate the transaction to a smooth real estate closing.
A real estate transaction is a legal transaction, and you are best served by having legal representation. Realtors are not licensed lawyers and are not best equipped to analyze contracts and deal with real estate disputes, should they arise. Probably the two most important times you need an attorney are contract negotiations and closing. It would be catastrophic to go through the entire experience just to have it fall apart during closing. Engage LexLawLawyers for successful representation.
The real estate transaction cycle consists of 10 basic steps. A better understanding of the cycle leads to a smoother transaction.
- Real Estate Contract. The contract contains all the terms of the transaction, including the following: names of the parties; price; description of the home and any personal property being transferred to the buyer; closing date; requirements regarding the deed, survey, title, contingencies, and inspection; etc. Best practices suggest the buyer review the contract with LexLawLawyers prior to tendering the offer to the seller and to insert the lawyer’s name and contact information on the contract itself. The buyer is also best served by adding any modifications to the local form agreement used by the Realtor BEFORE tendering the offer to the seller. Best practices also suggest the seller review the offer received from the buyer with LexLawLawyers before accepting the offer.
- Attorney Review. The real estate contract will typically offer the parties a limited period of time to have their respective attorneys review the agreement and to agree on any modifications to the contract. The buyer should consider adding a financing contingency when the buyer needs a mortgage loan to afford the purchase.
- Inspection Period. The buyer is granted an inspection period and can request repairs or credits at closing for necessary repairs to the property.
- The seller’s attorney orders a title search and title commitment to verify the true owner of the property being sold and to identify any encumbrances or liens against the property. The seller’s attorney tenders a copy of the title search/commitment to the buyer’s attorney for review.
- The seller’s attorney orders a survey to determine or confirm land boundaries. A survey also identifies restrictions and conditions that apply to the property being sold. The buyer’s attorney must review the survey to verify that no improvements have violated any building restrictions – like an encroachment on a setback requirement because a home or garage is built too close to the property line.
- Many buyers require mortgage financing to purchase a home. The buyer requiring financing must work with a mortgage provider to obtain financing to fund the purchase at closing prior to the expiration of any mortgage contingency.
- Most mortgage lenders require an appraisal to determine the fair market value of the property. The buyer’s attorney typically orders the appraisal and tenders a copy to the buyer and/or mortgage lender.
- Pre-closing. The seller’s lawyer should draft all closing documents and send a copy to buyer’s lawyer for pre-closing review. The seller’s lawyer should also obtain payoff letters regarding existing loans, and all utilities and other bills that must be paid at closing.
- The closing event occurs at either the lawyer’s office or the title company’s office as specified in the real estate contract. The closing can take anywhere from 1 hour to a couple hours. The closing documents are executed at closing.
- The seller receives the net proceeds from the sale and the buyer takes possession of the home once the documents are signed and the transaction is funded by the purchaser or the lender. Both parties celebrate a successful closing.