- SELLING RESOURCES -
RESOURCES FOR:
Closing is the final step of the sale. The required documents are signed, the buyer's funds are received, the seller's mortgage and other closing obligations are paid, ownership is transferred and the seller receives the remaining sale proceeds.
Closing sounds complicated, but most sellers have very little to do on the actual closing day if everything was prepared correctly during the pre-closing period.
YELLOW SAYS...
MOST OF THE WORK HAS ALREADY BEEN DONE
By the time you reach closing, the inspection period, financing, appraisal, title work and most seller tasks should already be complete. YELLOW tracks the contract dates and closing progress so you know what needs attention before the final day arrives.
Sellers do not always need to sit at a closing table with the buyer. Depending on the title company and the documents involved, you may be able to sign ahead of time, use a mobile notary, electronically sign eligible documents or complete part or all of the closing remotely.
At YELLOW, we prefer title services that make remote seller closings available when possible because they can make the final step much easier.
Whether a fully remote closing is available depends on the title company, lender requirements, the documents being signed and the notarization method being used.
As the seller, do you need to attend the closing?
Often, no. Sellers may sign documents before the buyer closes or complete the signing remotely. The title company will tell you exactly what is required for your transaction.
Your actual seller costs will be shown on the final closing statement. They are usually deducted from the sale proceeds, so sellers normally do not write separate checks for each closing expense.
SIGN DOCUMENTS
You will sign the documents needed to complete the sale and transfer ownership.
BUYER & LENDER FUNDS ARE RECEIVED
The title company receives the buyer's funds and, when applicable, mortgage funds from the buyer's lender.
SELLER OBLIGATIONS ARE PAID
The title company uses the closing funds to pay the seller's mortgage payoff, title charges, taxes, liens, agreed credits and other amounts shown on the closing statement.
OWNERSHIP TRANSFERS
The deed is delivered and recorded according to the closing company's procedures, transferring ownership to the buyer.
SELLER PROCEEDS ARE SENT
After the required closing conditions are satisfied, the remaining funds are disbursed to the seller, usually by wire transfer.
The exact documents vary by transaction, but sellers commonly see several of the items below.
The deed is the document used to transfer ownership from you to the buyer. The seller signs it, the signature is notarized and the closing company records it in the county's public records after the closing requirements are satisfied.
This statement shows the financial side of the transaction. It starts with the sale price and then shows the charges, credits and payoffs that determine your final proceeds.
You may see items such as:
The title company may ask you to sign affidavits or certifications about ownership, liens, parties in possession, unpaid work, judgments or other matters that affect title.
The title company may ask questions about your U.S. tax status because federal law can require withholding from a seller's proceeds when the seller is a foreign person for U.S. tax purposes. Most U.S. sellers simply complete the required certification, while other sellers may need additional handling.
Depending on the transaction, you may also sign a bill of sale for included personal property, payoff authorizations, association-related forms or other title-company documents.
READ BEFORE YOU SIGN
Closing documents can contain unfamiliar terms. If something does not match what you expected, ask the title company about it before signing.
The sale price is not the amount that goes directly into your bank account. The title company uses the transaction funds to pay the obligations shown on the closing statement, then sends you the remainder.
A simplified example looks like this:
Seller proceeds are generally disbursed after the closing company has the required signed documents, the buyer's funds and any lender funds, and authorization to close the file.
If you are being paid by wire transfer, the money may not appear instantly. Timing can depend on the bank, the time of day and the title company's procedures.
YELLOW SAYS...
VERIFY WIRE INSTRUCTIONS
Real estate wire fraud is a serious problem. Never rely only on an email that changes wiring instructions or asks you to redirect proceeds. Verify bank and wire information directly with the title company using a phone number you already know is legitimate.
Unless the contract provides for a seller leaseback, post-closing occupancy or another arrangement, the seller should be completely moved out and ready to give the buyer possession at the time required by the contract.
Do not assume that signing the paperwork alone means you can immediately leave or turn over the property. Follow the possession terms in the contract and the instructions from the title company.
WHAT TO HAND OVER
If you are signing remotely or before the closing date, the title company will tell you what identification, notarization or original documents are required.
Even on the scheduled closing date, an unexpected issue can sometimes create a short delay. Examples include a lender funding delay, missing signature, wire delay, title problem, association issue or final walkthrough concern.
Most short delays can be resolved, but do not assume the transaction is complete until the title company confirms that the closing has occurred.
Until that happens, keep possession of the property and continue following the contract.
Once the title company confirms the sale is complete, there are a few final housekeeping items worth doing.
If you have questions about the tax consequences of your sale, keep the closing statement and speak with your tax professional.
CONGRATULATIONS ON SELLING YOUR HOME!
Pre-closing
