Buyers - The Settlement Process
The settlement company coordinates all the parties, including the seller, buyer, real estate agents, lenders, etc., and gathers all the information for settlement. Some of the major steps that must be completed prior to settlement include:
- Reviewing the Sales Contract, title work, and survey, where applicable, to ensure that the property in question is clear of title defects and survey problems, and the contract accurately reflects the transaction.
- Gathering information from all the parties including a copy of the Sales Contract, information sheets from the agents, sellers, and buyers, and lender information.
- Establishing a time for settlement that is mutually agreed upon by all parties.
- Confirming that any required Termite Inspection has been completed.
- Collecting any Homeowners Association or Condominium Dues information.
- Scheduling the settlement with the lender.
- Additionally, either the day of or the day before closing you and your agent must complete a final Walk-Through of the property to be sure that all repairs from the home inspection have been completed and that no new problems with the property have arisen.
Clients always ask what to expect at settlement. First, it is important to know what to bring with you to closing:
- A valid picture identification, such as a driver's license, military identification, or passport. Some lenders are now requiring two forms of identification to be provided at closing.
- You will also need to bring a certified or cashier's check for the total amount due for closing, or you can arrange to wire the money to us prior to settlement - please call our office for specific wiring instructions.
How long do settlements last? A closing for a purchase usually lasts about one to one and one/half hours, whereas a refinance lasts less than an hour.
Who will be at settlement? At a purchase, both parties (buyers and sellers) attend along with their agents, and we work with a number of loan officers who like to come to closing when possible. During the closing, the parties sign all documents, and the purchaser(s) sign the lender's documents. As each document is presented to the parties for signing, the settlement agent explains the purpose of each document.
Who conducts the settlement? Most closings are conducted by a licensed settlement agent or our legal counsel.
Most clients are also very interested in how much everything costs and what documents are being signed at closing. At The Settlement Group, Inc., one of the primary documents reviewed at settlement is the HUD-1 Settlement Sheet. This document outlines all of the charges to each party, including Lender's Fees, Escrows, Government Recording Charges, the Survey, the Termite Inspection, HOA/Condo dues, and the Title Company's Fees. After reviewing the HUD-1 and signing our documents, the Seller will sign the deed, which transfers ownership of the property to the Purchaser. Once the deed has been signed, then the purchaser can commence with signing the Lender documents, which include the Note (which outlines the conditions of your loan) and the Deed(s) of Trust (a Security Instrument making the home the collateral for the loan's repayment). You will be given a folder with copies of the fully executed documents, or you can request an electronic copy for your files.
We also hear questions about what buyers need to be prepared for after settlement. Several important events occur after the day of settlement to conclude the closing process:
- The first step is the recording of your Deed and Deed of Trust among the Circuit Court Land Records for the appropriate jurisdiction. This step alerts the public to the fact that the ownership of the property has changed into your name(s).
- Once recording occurs, the next step is the distribution of all funds, whereby the Seller receives their proceeds and their deeds of trust are paid in full and closed.
- After learning that the documents have been recorded, The title agent sends your lender(s) all the documents they require from settlement.
- Additionally, if you purchased an Owners' Policy as part of the title insurance, then the Policy will be mailed to you after closing with the original recorded Deed.
- Confirm any Deeds of Trust paid off through the transaction have been properly released in the Circuit Court Land Records.
- Scan your file into secure electronic storage for future access as needed.
Virginia Land Title Association extends a tremendous amount of appreciation to VLTA Member, Myrna Keplinger, Principal of the The Settlement Group for sharing all of the materials found under the Consumer section of this website. All materials are copy-writed under The Settlement Group and VLTA has received "reprint" permission for its use.