What New Real Estate Agents Should Know about the Closing Process
New Agents and the Closing Process
The closing is the final step in a real estate transaction. During the closing, the sellers transfer ownership of the property to the buyers. The sellers will receive any proceeds they have earned from the sale of their house, and the buyers will be able to move into the house after the closing. The real estate agent also receives a check for commission earned from the sale. Finding the right home for buyers usually takes several months; thus, the closing is an exciting time for buyers and their agents.
A real estate agent’s role is central to the success of a real estate transaction, and this role is no less important during the closing itself. A real estate agent should make sure that all of the right documents are included in the closing package that the buyers will sign. Although a closing attorney will review the documents for legal accuracy, the real estate agent must make sure that the terms of the sale are correct and that documents involving the property are accurate.
For example, if there are any title issues, such as defects, with the property, the real estate agent may assist in resolving these matters. The real estate agent will also notify the parties of the closing date and location and will assist with coordinating the buyer’s final walkthrough of the home.
New Rules For Agents and Lenders
Toward the end of 2015, new rules were established that impact the closing process. All real estate agents should be aware of these procedures to ensure that the closing process goes smoothly and that all applicable laws and regulations are followed. If errors occur during a closing, it may cause delays in the transfer of ownership of the property, which will likely make clients very unhappy.
Lenders, instead of the settlement agents, must now prepare and deliver the closing disclosure form. This form is five pages long and contains details about the mortgage loan, such as its terms, the projected monthly payments, and closing costs. The lender must deliver this document to the buyer at least three business days before the closing occurs. The real estate agent must ensure that the closing agent has all of the information necessary to complete the closing disclosure form. In addition, the real estate agent will need to provide his or her broker’s state license number and the individual real estate license number for the closing disclosure form.
If any changes to the closing disclosure form cause the annual percentage rate to become inaccurate, the buyer changes loan products, or a prepayment penalty is added, a three-day waiting period may be triggered. Further, if any changes impact the value of the property, additional disclosures and review periods may be required.
After the closing
On some occasions, issues arise after the closing that the real estate agent will need to address for the clients. For example, if the buyers received a home warranty with their new home, they may need help filing a claim. The buyers may also have questions about the repairs that were to be done to the home prior to moving in. If the buyers are not satisfied with the status of any repairs, the agent may need to assist with resolving this conflict.
Let the De Bruin Law Firm Handle Your Closing
At the De Bruin Law Firm, our real estate attorneys are experienced in transactions of all types. We work closely with real estate agents to ensure clients are comfortable during the closing process. To speak with our attorneys about scheduling a closing, call (864) 982-5930 or visit debruinlawfirm.com.