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The closing process

While the title evidence is being prepared, the settlement agent is busy coordinating other matters. If the contract calls for a prior mortgage to be paid off, the agent will order payoff figures from the existing lender. If the buyer is assuming the loan, an assumption package will be ordered showing the current status of the loan.

While each closing is as unique as the people attending it, much of the behind-the-scenes work leading up to the closing is fairly commonplace for the skilled professionals performing it. Ordering property inspections, surveys and termite reports are typical of what's happening behind the scenes at this point in the settlement process.

The settlement agent brings any problems or discrepancies which may be discovered to the attention of the appropriate parties so that they can be corrected. It is his or her job to facilitate cooperation, coordination and compliance between all settlement service professionals involved with the transaction. Everyone working together helps make the closing a cause for celebration!

Once the preliminary work is complete and all information on the contract, loan closing documents and title commitment has been compared and complied with, the settlement agent is ready to prepare the HUD-1 Settlement Statement.

All costs must be shown on the HUD-1. This includes costs paid at closing as well as pre-paid costs, such as earnest money deposit or loan application fee. If you are a buyer and are obtaining a loan to purchase residential property, your lender has three days from the time of the loan application to provide you with a Good Faith Estimate of your loan costs. Within those three days you should also receive a copy of the HUD-1 Booklet, "Buying Your Home," which outlines the settlement process.

The closing is where it all happens. Everything done behind-the-scenes leads up to this day. It's time to close the transaction and transfer ownership of the property from the seller to the buyer. If that buyer is you, welcome to your new home!