Chapter 28The Real Estate Closing Process

The secret of a man’s success resides in his insight into the moods of people, and his tact in dealing with them.

—J. G. Holland

You’ve just run 25.5 miles of a 26-mile-long wholesaling marathon. When you reach the closing process, the finish line is in sight.

It starts when you sign an assignment of contract (or a second purchase and sale agreement) with your buyer. That signature is the first step of a complex process that ends with the close of the entire transaction—and a check for the deal in your hands.

The closing process officially starts when you open escrow with an escrow company, title company, or an attorney. In escrow, ownership of the property is transferred via the assistance of an impartial third party. Escrow is designed to minimize risk for both the buyer and the seller because the responsibility for handling the documents and funding is placed in the hands of someone not affected by the outcome of the transaction. Having an escrow minimizes the possibility of fraud or a violation of any terms of the agreement.

You will have to manage the closing process to make sure that your deal closes on time. For that reason, you need to be in constant communication with all parties involved in the transaction. And you need to understand how the closing process itself works.

WHO HANDLES THE ESCROW AND CLOSING?

This will depend on what state you are doing business in. In some states it’s customary to have an escrow company or ...

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