A closing in real estate is the final step in any real estate sales transaction. Closing is the process by which the ownership of the property is transferred to the buyer. Sometimes, possession is transferred at the closing.
Each state has its own rules regarding who may handle a real estate closing. In California, for example, real estate escrow and closings can be handled by:
- Escrow companies licensed by the state’s corporation commission
- Banks and other lenders
- California-licensed attorneys
- California-licensed real estate brokers, and even
- Property title companies
Not all states, however, allow such a variety of persons or entities to handle real estate closings. Georgia law, for example, requires that all real estate closings be overseen by an attorney. Indeed, Georgia doesn’t even allow bank closings or so-called “witness-only” real estate closings.
All closings in Georgia must be handled by an attorney.
Some of the Reasons Behind Georgia’s Closing Requirements.
Real estate transactions begin when a buyer and seller sign the final purchase and sale contract. It is this contract which gives all the material terms of the purchase and sale agreement. It will include price, the amount of earnest money, closing date, any seller-paid closing costs, and any contingencies that form part of the contract.
The final phase in a real estate transaction involves escrow and closing. The entire process is complicated and requires following a number of specific steps. By overseeing the entire process, the closing attorney helps those involved in the transaction by making sure that all the documents are correct and complete, and by explaining the transaction. This way, all parties can make sure they’re getting what they bargained for.
Georgia law not only requires that all closings be handled by an attorney, but it mandates that the closing attorney be physically present at the closing itself. This requirement grew out of Georgia case law where the court found that an attorney’s handling of a closing transaction by telephone was “ethically improper.”
What Does the Closing Attorney Do?
In most home purchases, the buyer will get a loan from the bank in order to purchase the home. At closing, the closing attorney helps the lender or mortgage broker by making sure that the loan documents are executed properly, and that there are no title issues related to the property that is being used as collateral for the loan. This helps to ensure that the lender will be in first priority position if for any reason the borrower defaults on his loan. The closing attorney also can help smooth the transaction real estate agents or brokers by making sure that all title issues are handled property
In addition, the closing attorney helps the purchaser by making sure that the purchaser understands his/her rights and obligations. This does not mean, however, that the closing attorney represents the purchaser. He does not. In Georgia, the closing attorney represents the lender —not the buyer or the seller. Which is why it is important if you are a buyer or seller, to consult your own real estate attorney.
Real Estate is What We Do.
Since 2001, the law practice at the Law Offices of Mark Weinstein has been focused on all aspects of real estate law and litigation. We are located in Cumming, Georgia, but we serve clients in and around Atlanta, Marietta, Roswell, Sandy Springs, Kennesaw, Forsyth County, and a number of other counties in Georgia. Call us at 770-888-7707, or contact us here, or send inquiries by e-mail to: email@example.com.