Residential Closings

Residential Closings

You’ve finally reached the final step in the residential real estate buying and selling process. After weeks or months of processing the papers, the only thing left to do is sign the documents and wait for the turnover of keys or release of keys. 

To give you a summary of how a sale/ purchase of a home, we have listed 4 transactions involved:

  • Real estate negotiation and execution of sales contract
  • Pre-closing due diligence 
  • Real estate closing (you are currently here)
  • Post-closing

We know that you’re excited to be a homeowner or a successful seller but hold your horses! Closing the deal is as vital as the initial steps. It is crucial that when buying, selling, or refinancing a property, you will hire a top tier real estate agent and a legal professional. They will help you handle all the paperwork, so the only thing left is for you to sign the documents.

Read on to know more about residential closings and the typical activities/ transactions associated with closings. 

What Are Residential Closings?

Residential closing is the final step in the residential real estate buying and selling process. The closing stage starts when the seller’s party has already accepted the offer of the buyer. Once accepted, you can now set a closing date. 

During this stage, your real estate lawyer will meet you 2-3 days before the sale/ purchase date to discuss the purpose of the documents to be signed. Your lawyer is vital in this stage since he will accompany you and review the documents so that you won’t make mistakes. 

Upon closing the deal, the property’s ownership is formally transferred from the seller to the buyer. The buyer may now freely start moving into the house or opt for renovations before moving in. 

Process Of Closing A Residential Property Transaction

Process Of Closing A Residential Property Transaction

To reach the closing stage of a residential property, you still have to take other steps. This ensures that the property being sold/ bought will not cause further problems for both parties.

Here is a typical process to close a property: 

  • Open an Escrow Account
  • Title Search and Insurance 
  • Hire an Attorney
  • Negotiate Closing Costs
  • Complete the Home Inspection
  • Get a Pest Inspection
  • Renegotiate the Offer
  • Lock in Your Interest Rate
  • Meet Funding Requirements
  • Final Walk-Through
  • Understand the Paperwork

This is a general process, and missing one or two doesn’t mean that the approach you took is wrong. We only presented our lawyers and their client’s usual process before closing the property’s sale/ purchase.

As listed above, there are a lot of things to do before closing a sale is done. These stages usually take a couple of weeks or months to complete depending on the property’s state and how responsive both sides are.

To reach the closing stage faster, you should hire a good real estate agent and lawyer to keep the flow going. Real estate agents and lawyers will be a big help since they already know the lender and the government’s requirements when a transfer of ownership is conducted. 

How To Prepare Documents in Residential Closing Transactions

When dealing with legal and financial documents associated with closing residential purchases, it is essential to be careful and thorough. A mistake may prolong the process since you’d have to discuss the corrections with your lawyer and the other party before having the files changed.

We have listed here the files needed when closing a deal:

  • The closing disclosure
  • Title or warranty deed
  • Mortgage
  • Monthly payment letter
  • Proration papers
  • Statement of identity
  • Declaration of report
  • Abstract or title
  • Promissory note
  • Truth in lending statement

The documents needed for your purchase will be based on the existing state laws in your area and the type of home you are buying. The documents listed are a full list of documents required in different places, so it is always best to consult your agent before preparing the documents.

Another tip for buyers is that you should’ve already prepared the documents needed so that you can shorten the processing time of your purchase.

Topics Related to Real Estate Closings

Closing Costs

Usually, home buyers will be paying 2 to 5 times their home’s purchase price as closing fees.

First-Time Homebuyer Checklist

Before buying a house, here are some things that you might want to consider: 

  • Make sure you’re ready
  • Think of what you home you want
  • Figure out what you can afford
  • Gather necessary documents
  • Research mortgages
  • Assemble your team

Difference of Commercial Closing from a Residential Closing

  • More complex since more people are involved
  • Must have PSA

Buying or selling a residential property can be a daunting task, and you should speak to a real estate lawyer for assistance throughout the transaction process. Contact an experienced Diamond and Diamond lawyer today!

PRO TIP:

“The term real estate closing should be thought of as a process rather than a specific step in the home buying process. You can choose to take care of this task yourself if you have the time and energy or hire a professional or real estate lawyer to make it easier on you.”

– Company Owner

Why You Should Hire A Real Estate Lawyer for Residential Closings

Why You Should Hire A Real Estate Lawyer for Residential Closings

Residential property transactions shouldn’t be done without the supervision of a lawyer. When performing real estate transactions with other people that involve a large amount of money, hiring a real estate lawyer will be beneficial for you. 

Lawyers aren’t required, but retaining counsel is a good idea. Here are some reason why:

  • Real estate lawyers can properly guide you and keep you informed about the process.
  • Real estate lawyers can handle the real estate transaction and ensure that your rights are protected. 
  • Having a second set of eyes trained in the legalese used in closing documents ensures red flags don’t fly under the radar.

Aside from guiding you, they can also help in these tasks:

  • Reviewing Real Estate legal Contracts
  • Reviewing offering plans
  • Drafting post-closing Possession Agreement
  • Negotiating deeds in lieu of foreclosure
  • Mortgages and real estate financing
  • Title examinations
  • Drafting Joint Property Agreements
  • Residential lease review

Contact Experienced Real Estate Lawyers from Diamond and Diamond

There will be several fees you must pay in order to conclude a real estate transaction. These fees include taxes, fees for Title Search, property tax certificates, registration fees, land transfer tax, title insurance, and other searches that are required for the closing of your home.

Ensure that your best interests are protected during the purchase of your new home. Get superior quality legal advice from our experienced real estate lawyers at Diamond and Diamond.

Read FAQs About Residential Closings

What is proration?

Prorations are costs that the seller and buyers share. For example, the seller has already paid the property’s annual property tax; then the buyer needs to pay the seller the taxes for the months that the seller will no longer live in the house.

Where do residential closings typically take place?

For closing appointments, you’ll likely meet with the other parties at the office of the escrowee. The people who will be present in the closing include the seller, escrow/ closing agent, lawyer, a title company representative, the mortgage lender, and the real estate agents.

Is it possible for me to sign closing legal documents without a lawyer's assistance?

Yes. It is possible for you to sign legal documents without a lawyer’s assistance, but you should review all the information in the documents you are about to sign. There may be statements that will not be in favor of you. That is why if you can, hire a real estate lawyer.

Free Consultation

Recent Case Results

$1.6 Million

Car Accident

An elderly woman was struck exiting her vehicle resulting in serious leg injuries. Our team was able to obtain a settlement for $1.6 million from the insurance companies.

» READ MORE

$1.25 Million

Head on Collision

Our client was involved in a head on collision that broke both of her legs. Our car accident lawyers obtained a $1.25 million settlement from the insurance company.

» READ MORE

$1.3 Million

Neck Fracture

A 21-year-old male was injured as a passenger in a motor vehicle accident. As a result he received a fractured neck. Our accident lawyers were able to settle the case prior to trial for $1.3 million.

» READ MORE


Get the help you deserve

1-800-567-HURT

Call NOW for a free consultation

Diamond & Diamond Ontario Head Office

255 Consumers Road, 5th Floor, Toronto, Ontario

>> Learn More

Diamond & Diamond Alberta Head Office

4246 97 Street NW, Unit 100, Edmonton, Alberta

>> Learn More

Diamond & Diamond British Columbia Head Office

1727 West Broadway, Suite 400, Vancouver, British Columbia

>> Learn More

Barrie

17 Poyntz Street

Brampton

341 Parkhurst Square, Suite 5

Calgary

1331 Macleod Trail SE, Suite 420

Edmonton

4246 97 Street NW, Unit 100

Hamilton

105 Main Street East, Suite 1500

Kelowna

1631 Dickson Avenue Suite 1100

London

256 Pall Mall St, Suite 102

Oakville / Mississauga

2939 Portland Drive, Suite 200

Oshawa

50 Richmond Street E, Unit # 108 B

Ottawa

955 Greenvalley Crescent, Unit 315

Sudbury

144 Elm Street, Suite 201

Surrey

1104 – 13737 96 Ave, Surrey, BC V3V 0C6

Thunder Bay

278 Algoma Street South

Toronto

255 Consumers Road, 5th Floor

Vancouver

1727 West Broadway, Suite 400

Windsor

13158 Tecumseh Rd. E. Unit 3B