The real estate closing process varies from state to state. In North Carolina, potential buyers and sellers need to take several steps to secure the necessary protections essential during the closing process. Here are the essentials you should keep in mind when buying or selling your home.
The initial phases
Once both the buyer and the seller have agreed to the initial terms offered by the buyer, the parties start the real estate closing process by initiating a sales contract. In this phase, the buyer secures any initial deposits on the home, such as escrow deposits or earnest deposits, into the agreed-upon escrow fund.
Once the fund receives these deposits, the escrow or real estate agent often begins by making a title request and purchasing title insurance for the buyers. This step is essential for a variety of reasons. Title insurance offers protections in the event of many different situations, such as:
- Title liens or holds that were not initially disclosed during the buying process
- Title defects, such as incorrectly recorded documents or fraud
- Encroachments or easements that may prevent the title from being transferred to the buyers
The inspection stage
The next stage of the buying process is often called the inspection stage. Several events take place during this portion of the real estate closing process to ensure that buyers receive a fair price for their purchased homes. Once done with inspections, buyers may request repairs or renegotiate contract terms with the seller. Some inspection-related closing events include:
- Pest inspections
- Home and construction inspections
- Property surveys
- Insurance quotes and inspections
- Lender-ordered appraisals
The closing date
The final phase of the real estate closing process occurs on the closing date when buyers conduct their final walk-through and sign the official contract of sale and any other required documents. In most cases, the real estate agent prepares the documents in advance for all involved parties.
Once both parties sign the contracts, the closing process is complete, and the paperwork is processed and forwarded to applicable parties. There are many steps to a real estate transaction, so buyers and sellers need to be thorough, but all these steps are designed to help ensure that a sale goes as smoothly as possible.