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Chapter
22
Title Closing and Escrow
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In This Chapter

You learn how the process evolves
from the buyer’s walk-through to
the closing meeting or escrow,
prorations, & the settlement
statement.
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Buyer’s Walk-Through
This is the final inspection of the property just
prior to closing to make certain that the
premises have been vacated, no damage has
occurred, agreed personal property is left
behind, and that no real property has been
removed.
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Title Closing
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This occurs when the buyer pays for the
property and the seller delivers the deed.
Settlement meeting – seller meets in person
with the buyer and delivers the deed.
Escrow – use of a neutral third party, called
the escrow agent, who acts on behalf of both
buyer and seller to carry out instructions of
the contract.
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RESPONSIBILITIES AT
CLOSING
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SELLER’S
BUYER’S
REAL ESTATE AGENT’S
ESCROW AGENT’S
Reporting Requirements
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Prorations
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Insurance
Loan Interest
Property Taxes
Rents
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Common Prorations
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Closing Transaction Summary
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HUD Settlement Statement


Required of all federally related real estate
lenders
Form HUD-1A
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HUD Settlement Statement
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HUD Settlement Statement (continued)
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HUD Settlement Statement (continued)
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Real Estate Settlement Procedures Act

To regulate and standardize real estate
settlement practices when “federally related”
first mortgage loans are made on residential
property
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RESTRICTIONS ON CLOSING PRACTICES
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prohibits title company kickbacks
does not allow referral fees
prohibit what titles companies can pay for
outside of their normal business activities
Texas Restrictions on Closing Practices
Note: Title companies can participate in associations of real
estate practitioners, attorneys, builders, and developers, and deliver
documents or funds to the parties of a closing, so long as they pay
the market rate for participating.
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HUD Settlement Statement
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required of all federally related real estate lenders
GFE
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Key Terms
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Closing meeting
Escrow agent
Escrow closing
Prorating
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RESPA
Settlement
statement
Title closing
Walk-through
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