Closing is the final step in a real estate transaction. This is the stage where the buyer obtains the property’s title from the seller. It is also the stage where the seller obtains payment for the property.
Being a critical step, you need to have an attorney involved during your real estate closing. Here are three reasons why:
1. Examining the title
A clean property title is crucial during real estate closing. An attorney will examine the title for encroachments, restrictions, easements, and whether the seller can legally transfer it to the buyer. The attorney will also investigate if there are any existing mortgages on the property that must be satisfied before a transfer can be executed.
2. Applying for title insurance
Title insurance is a binder policy that assures potential lenders the title is clean and can be deposited as collateral for the property’s financing. You cannot qualify for financing before the title of the property in question is given a clean bill of health through an attorney.
3. Document preparation
Both parties to the transaction can engage an attorney in collecting and preparing the final transaction documents such as closing disclosure, warranty deeds, a bill of sale and any affidavits related to the title. The attorney will explain these documents and answer any questions you might have concerning your obligations and rights.
Real estate transactions in Pennsylvania are complex undertakings, particularly when you’re buying property as an investment. Having the information and legal support you need during the closing stage can help you make the right decisions and avoid costly mistakes down the road.