Settlement Day

Tonight, you can celebrate, but today there will be a lot of paper signing and a poignant passing of the keys (do not forget the garage keys, and the electric garage opener, too).

At the settlement will be an attorney or title company representative, the buyer, listing and selling brokers, and all owners. The home seller should bring all warranties on equipment (or leave them in the house) and any instructions on equipment maintenance or operation.

The attorney will have searched the title, and obtained old and new lender instructions. First, all unresolved walk-through deficiencies are resolved.

With the buyer, the attorney explains the deed of trust, deed of trust note, and settlement sheets. The buyer signs all three, and pays the balance of the down payment and buyers closing costs.

With all owners, the attorney explains the deed and settlement sheets and gets the home seller signatures on them. The seller pays appropriate closing costs.

Sellers Settlement Costs

The closing costs for the seller may include:

  1. Attorney fees (preparation of the deed, settlement fee, and any release fees)
  2. Lender inspection fee
  3. Appraisal
  4. Broker commission
  5. State deed transfer tax and recordation fee
  6. Condominium or homeowner association packet fees
  7. Water escrow (to reduce, bring canceled check and last bill; amount prorated at settlement)
  8. Termite inspection
  9. Loan discount fee (points based on loan amount)
  10. Mortgage pay-off penalty (see deed of trust note)
  11. Interest up to the date trusts are paid off
  12. If the seller taxes or insurance have been escrowed, the seller will receive any money accumulated in the account for bills not yet due. Additionally, the seller will be reimbursed for any money paid in advance and not used, such as property taxes. The seller will receive these refunds at or after settlement, depending on the locality. Taxes and homeowner association dues or condominium fees will be prorated on a daily basis. The seller, buyer, and brokers are supplied a copy of settlement sheets for their records. The house keys are transferred to the new owners.


The attorney or title company will disburse funds after all funds are in hand, checks have cleared, the new lender has reviewed papers, and the title has been re-checked and the deed recorded. The seller should not plan to receive funds for up to four days.

The house has now been sold, settled, and funds disbursed.