To read this blog in Spanish, click here.
To download the blank checklist for use in your transactions, click here.
To view the Checklist for Buyers, click here.
To view the Checklist for Sellers, click here.
To view the Checklist for Realtors, click here.
To view the Checklist for Lenders, click here.
PRE CONTRACT PROCESS
Help parties understand an Overview of the Closing Process
Chapter 1: What is the Role of the Title Company in the Purchase & Sale Process and Why is Title Insurance so Important? (04:55)
Chapter 2: How does the Closing Process work? What are the Key Milestones, Dates, and Responsibilities that a Buyer needs to know? (14:01)
Chapter 3: Frequently Asked Questions about the Real Estate Closing Process for Buyers and Real Estate Agents (13:39)
PRO TIP: At FOLIO, we are committed to guiding you from Contract to Closing and providing you all the information you need to make a great Purchase decision. We invite you to read our Buyer’s Guide to Real Estate Closings to give you a wider scope of knowledge and to be prepared during your transaction. Please let us know if you have any questions and we are happy to clarify them as early as possible.
PRO TIP: If you are purchasing a property in a Condominum, we invite you to read our TIPS AND KEY INFORMATION WHEN PURCHASING A CONDO IN FLORIDA.
Inspection Period
Once a fully executed Contract is received, the Onboarding of file will begin:
Once we receive this information, our Onboarding Team will open the transaction in our Closing System within the next 6 to 24 business hours and assign a Processing & Closing Team to start working on your file immediately.
An email is sent from our Onboarding team with the following:
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- A link to fill out a form with the information we need to begin processing the file. Delays in this information may delay the closing
- A timeline of Key Contract Dates
- An introduction to your Processing & Closing Team
- Wire Information and Wire Fraud Prevention Tips
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If the Buyer is obtaining a mortgage loan, we prepare and send a preCD with the estimated closing costs to the mortgage loan originator within 48 business hours of opening the file in our system.
Our team will order the title search and lien search within 24-48 business hours of opening the file in our system. Surveys and Estoppels are usually ordered after the Inspection Period and sometimes after the Appraisal results. If you have any questions as to these orders or their timing, please let us know.
If the Closing Agent is also the Escrow Agent, an Escrow Letter will be sent to the parties within 24 business hours of acknowledging a receipt of funds.
Provide the lender with required information once Lender sends a Title Request: preCD, CPL, Chain of Title, E&O Policy.
Gather Broker Commission Disbursement Instructions information from real estate agents.
Contract Due Diligence and Financing Period
Order survey (single-family homes) or estoppels (condos).
Order payoffs from the seller’s lender if the property is subject to mortgage or HELOC.
PRO TIP: If the Seller has a HELOC, in addition to a HELOC Payoff, the Closing Agent requires that the HELOC lender provides evidence that the HELOC account has been “frozen”. This is a requirement of the Closing Agent and will result in delays if not provided before closing.
Prepare or request and approve conveyance documents: Warranty Deed, Bill of Sale, Closing Affidavit, Non-Foreign/FIRPTA Affidavit, Disbursement Authorization, and any other documents required by the title insurance underwriter or Closing Agent.
Closing agent is looking to ensure (and insure) “clear and marketable title”
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- Review title conditions on Title Commitment that seller must cure before conveying (transferring or selling) property; provide Seller and/or Seller representative a copy of Title Commitment
- Obtain information related to title defects from underwriter and/or public records search
- Review lien search for City/municipal permits, violations, taxes, public utilities (water, etc) that can result in future fines or liens for buyer
- Review prior Property Taxes; ensure collection to pay those overdue taxes at closing
- Boundary survey (there are many types of survey) to check for encroachments, easements, property lines
- Estoppel analysis; communicate with Seller any violations and reflect any charges on the HUD
Audit the file (pre-Closing).
Pre-Closing & Closing
Ensure title conditions and contract terms and conditions have been met Cannot call for Closing unless conditions are met.
Balance CD with lender; Provide clients with Cash to Close (if not final, then estimate if possible).
Coordinate with lender for loan package and closing instructions.
Coordinate with clients (and real estate agents) for Closing
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- If there is RON or Mail-away should be coordinated at least 7 – 10 days before Closing.
Ensure receipt of funds required for Closing:
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- Escrow deposit funds (if the Escrow Agent is not the Closing Agent)
- Cash to Close (from Borrower)
- Loan proceeds
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Prepare disbursements via check or wire
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- Seller Proceeds
- Payoffs (mortgages, HELOC, association dues)
- Taxes Due
- Real estate agent Commissions
- Withholdings in Escrow – Water holdbacks, FIRPTA Funds, Association payments waiting for confirmation)
- Excess cash from Buyer
- Other items from the Settlement Statement
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Post-closing
*Provide notice to Buyer, Seller (or Seller Rep), and agents that transaction is closed and send Closing Documents
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- Buyer: WD, Loan Package, Final HUD/ALTA
- Seller: Final HUD/ALTA, Copy of Disbursement
- Buyer Agent: Final HUD/ALTA
- Seller Agent: Copy of Disbursement, Final HUD/ALTA
- Seller or Seller Rep/Atty: Final HUD/ALTA, Copy of Disbursement
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Record conveyance docs: Warranty Deed, Condo Approvals, POAs; Follow up on Satisfaction of Mortgage (SAT), if applicable.
PRO TIP: The recorded Warranty Deed will be available once the County Recording Office records and publishes the recorded documents on the County Clerk of Court’s website. Some counties take less than 48 hours and other counties more than 2 business weeks to publish recorded documents in the Public Records. Sometimes it may take longer to reflect a change in ownership in the Property Appraiser website (which is a different website than the County Clerk of Court).
Send check disbursements by mail or courier;
Buyer’s will receive electronic copies of the Recorded Warranty Deed and the Owner’s Title Insurance Policy within 90 days after Closing.
If there are FIRPTA funds withheld, must wait for IRS instructions for disbursement.