STEP #8: CLOSING ESCROW
As the Seller, your most important tasks to close escrow include making your home available when needed for inspections and appraisals, preparing various forms and statements (such as disclosures if you haven’t already done so, and any other forms required locally, such as a smoke detector certificate), and meeting any other contingencies you agreed to in your contract, within the promised time frame.
What is escrow?
Simply put, escrow is the handling of the contract by a neutral party which will ensure that the terms of the contract are met by both sides and all monies will be disbursed by them upon satisfactory fulfillment of the contract by both parties.
The last phase of the escrow process when selling your home, will be the signing of the grant deed, and receiving your money. All that is left for you to do is move. Hopefully, you will have made all the preparations in advance.
- Order all utilities to be shut off on the day of closing. This will allow the buyer to transfer them into his or her name without them having to have the service reconnected.
- You will have everything packed and ready to go, and the moving company scheduled.
- The home is to be delivered to the buyer according to the terms of the contract, and in the condition they saw it during their walk-through. There is no last-minute decision to take the refrigerator if the buyer requested it.
- The seller is expected to leave the home “broom clean”.
- There is a time specified by which all the keys shall be delivered to the buyer and the seller needs to have vacated the property. This is usually by 5:00 p.m. on the day of closing.
What Happens on the Big Day?
There is a lot of paperwork that goes along with this process. The escrow company will have most of the documents ready to go — they’ll just need to be signed. The home buyer will have a lot more paperwork to sign than the seller. Here are some specific things that happen on closing day:
- The buyer (or the buyer’s lender) will provide a check for the amount owed toward the purchase price of the house.
- The seller will sign the deed over to the buyer. This act officially transfers ownership to the buyer. The seller will turn over the keys, as well.
- The title company (or in some cases a lawyer or notary) will register the new deed with the appropriate government office. This record will show the buyer as the new homeowner.
- The seller will receive any proceeds they earned from the sale, once their mortgage balance and closing costs have been paid off.
When all of the documents have been signed, and all funds have been properly distributed, the deed of ownership will be transferred from seller to buyer. Finally, you (the seller) will hand over the keys.
Escrow closes, and title changes hand to the new owner. You are now on the way to your new home.