The Settlement Process

Before Settlement

The Settlement Group 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:

Establishing a time for settlement that is mutually agreed upon by all parties
Gathering information from all the parties including a copy of the contract, information Sheets from the agents, sellers, and buyers, and lender information
Ordering the Sellers' payoffs
Ensuring that the Termite Inspection has been completed
Collecting the HOA or Condo Dues information
Obtaining the Certificate of Insurance
Scheduling the settlement with the lenders
Reviewing the contract, the title work and the surveys, where applicable, to ensure that the property in question is clear of title defects and survey problems, and the contract accurately reflects the transaction

Additionally, either the day of or the day before closing the Purchasers and their agent must complete a final Walk-Through of the property to ensure that all repairs from the home inspection have been completed and that no new problems with the property have arisen.

During Settlement

Clients always ask: what should I expect at settlement. First, it is important to know what to bring to settlement. Here is a detailed list of our requirements:

Both parties: bring a valid picture identification, such as a driver's license
Buyer: you will need to bring a certified or cashier's check (made payable to The Settlement Group) for the total amount of your closing costs or have arranged to wire the money to us - call office location for instructions
Seller: if you want us to wire your proceeds to you, please provide wiring instructions or a voided check

Secondly, we are asked - how long do settlements last? A closing for a purchase usually lasts about one to one and half hours, whereas a refinance only lasts about half an hour. Thirdly, clients ask - who will be at settlement? At a purchase, both parties (buyers and sellers) attend along with their agents. At a refinance, normally only the borrower(s) attends. During both a purchase and a refinance, the parties sign all of The Settlement Group's 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. Finally, the parties want to know - who conducts the settlement. At The Settlement Group, all closings are conducted by one of our attorneys or a licensed settlement agent.

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. The Settlement Group's fees, which are discussed in detail below (please click on this link to read more. LINK) 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).

After Settlement

We also hear questions about what buyers and sellers 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 at the local county courthouse. This step alerts the public (via the land records office) to the fact that the ownership of the property has changed into the names of the Purchasers
Once recording occurs, the next step is the distribution of all funds, whereby the Seller receives with his/her proceeds and the deeds of trust are paid in full and closed
After learning that the documents have been recorded, The Settlement Group also sends the lenders a packet of all the documents they require from settlement
Additionally, the Purchaser will need to remember that if s/he purchased an Owners' Policy as part of the title insurance, then the Policy will be mailed to the Purchaser after closing. This process usually takes between six to ten months as the Policy is not drafted until the county returns the recorded documents to the settlement company

Finally, we understand that the settlement/closing process is very stressful for all involved, and we hope that this information will make the process smoother and more transparent. If you have further questions, do not hesitate to contact us at info@settlementgroup.com.