REAL ESTATE LAW
At Karrenstein & Love, PLLC., we have handled thousands of closings, ranging from residential refinances to commercial development and acquisition closings. We also have extensive experience in drafting restrictive covenants for neighborhoods as well as other legal documents such as easements, power of attorneys, lease options, contracts, and boundary agreements, to name only a few.
The information included in this website is designed to provide information to residential real estate clients (buyers, sellers, refinance borrowers) with information about the closing process and to make the process more efficient by providing forms for information we need in order to assist our clients. Please click on the sub-tabs of this page for specific information relevant to you. Please note that all other clients or prospective clients should contact our office directly for any desired information.
The Real Estate Closing Process
The Real Estate Closing Process for a buyer
As a buyer using a mortgage loan to purchase a home:
- Decide if you would like to use a real estate agent to help you find a home. An agent can assist you greatly during the following process of buying a home.
- Find a lender that you are comfortable using and have them let you know what price range you can afford for your new home.
- Find the home you would like to purchase. Negotiate and sign a contract with the seller for a mutually agreed upon sales price.
- Chose a closing attorney and schedule a closing date. The closing should be scheduled at least 2 weeks in advance. Generally, in North Carolina, you as the buyer have the right to choose the closing attorney. Some lenders require you use certain attorneys. The seller can chose to have their attorney prepare the warranty deed and verify the settlement statement.
- Notify your lender that you have signed a contract on a home and chosen a closing attorney. They will request a copy of the signed contract and contact information for the closing attorney.
- Order any inspections or survey you or your lender require. Unless you are buying the home “as is”, your purchase contract should have a “cost of repairs” clause. If the inspection reveals repairs needed, you must negotiate with the seller which repairs will be made prior to the closing and who will be responsible for paying for those repairs. The inspection procedure can be time consuming and is often ongoing throughout the home buying process. All issues regarding repairs should be fully resolved before the actual closing date.
- Your lender will request a title commitment from your closing attorney and order an appraisal of the property.
- The attorney will perform a title search on the property you are purchasing and provide a commitment for title insurance to your lender.
- Once your loan is approved and all repair issues have been resolved, your closing attorney will order any payoffs required in order to transfer the property to you free and clear of any liens.
- Your lender will send your closing package to the closing attorney.
- You do a final walk through of the property the day of or the day before the closing. This ensures that the agreed upon repairs have been made and there is no new damage to the property.
- The closing attorney reviews the lenders documents, completes a settlement statement and prepares any documents needed to complete the transaction. He then advises the buyer and/or the seller if they need to bring money to closing.
- You and the seller will meet with the closing attorney and sign any paperwork required.
- The closing attorney sends your signed documents to your lender and your lender releases your mortgage funds to the attorney.
- The attorney records your deed and mortgage at the county register of deeds. He then releases the sellers’ proceeds, pays all invoices and commissions and sends all payoffs that were required to give you clear title in your new home.
- YOU NOW OWN YOUR NEW HOME
- The attorney completes a final title opinion and submits it to the title company for title insurance.
Mortgage Fraud Prevention
This office is dedicated to assist the financial industry in its fight for the prevention of mortgage fraud and fraud in general. As a result, please note the following and please refrain from asking us to make any exceptions to these requirements:
- We require that all charges and payments are shown on the HUD-1 Settlement Statement and are approved by the lender in advance of the closing.
- We do not close any flip or double-escrow transactions.
- We do not notarize anybody’s signature who has not signed the document in our office and can prove his identity.
- We do not backdate any closing documents.
It is common knowledge that mortgage fraud is a very serious offense. Conviction thereof can result in a lengthy prison sentence. The United States Attorney General has made it abundantly clear during recent years that all parties to the closing process are charged with the duty to refrain from committing fraud and the duty to prevent other parties from committing it.
Things you should be aware of as a seller prior to closing
If our firm is been retained to conduct the closing on the sale/purchase of real estate which you own, the following information will be helpful to you.
First, please complete and return our Seller Information Form found in the FORMS section of this website.
Please bring to closing valid picture identification for the purpose of notarizing your signature. IF YOU DO NOT PLAN TO ATTEND CLOSING, NOTIFY THIS OFFICE AS SOON AS POSSIBLE OR AT LEAST ONE WEEK PRIOR TO CLOSING. You may either execute a power of attorney or sign the documents prepared in advance for you. There are additional fees for these advance services.
PLEASE BE AWARE THAT SALE PROCEEDS CANNOT BE DISBURSED AT CLOSING. North Carolina law requires that title to the property be updated, the deed recorded, and all incoming funds verified in our trust account before funds are disbursed. Typically, we disburse funds on the next business day following the closing. If you are moving to another state immediately after this closing and need your closing proceeds from this sale for your purchase in another state, please inform us of this at least one week before closing. You may obtain a certified check from our bank for a nominal fee for your sale proceeds after we have disbursed funds. We are also able to wire funds to the account you specify, for an additional fee.
As the seller of the property, you will incur the following expenses in this transaction:
- Real estate commission (if a real estate agent is involved);
- Deed preparation fees and charges associated with documents necessary to clear title or make title marketable for you;
- State sales tax ($2 for each $1000.00 of the purchase price);
- Pay-off of any outstanding deeds of trust, liens, assessments, taxes or judgments;
- Miscellaneous fees such as express mail fees (in the range of $15.00 per express fee), fax, copy and long distance (if excessive), and any other out-of-pocket expenses this office incurs on your behalf.
Our legal duties as the closing attorney are owed primarily to the buyer and secondarily to the lender (if any). Although we can prepare the deed and lien waiver on your behalf, we do not represent you. If you believe you need representation or legal advice in this transaction, please retain separate counsel well in advance of closing.
Because closings are often scheduled at the end of each month substantial demands are made on our office at that time. If you will require your sale proceeds immediately after closing, please so advise our office so that we may make special arrangements for you.
Things you should be aware of as a buyer prior to the closing
WHOM WE REPRESENT
We represent you to the extent of ensuring that you acquire good and marketable title to the property. A closing attorney’s representation is limited to legal questions concerning title to your property, title insurance and the covenants and conditions of your loan documentation. Our primary role is to make sure that the property you are purchasing has clear title, that the transfer of property takes place in a legally sufficient manner, that all existing liens are canceled or insured over and that the Deed and all other documents to be recorded are recorded accurately.
We represent the mortgage lender to the extent of assuring full compliance with its loan closing instructions.
In the event of a dispute between you and the mortgage lender, we will not attempt to represent either party.
We do not represent you with respect to the terms of your loan agreement with your mortgage lender (i.e., your loan amount, interest rate, conditions for later conversion or refinancing, necessity or amount of mortgage insurance, etc.). You should obtain a copy of your closing instructions and Good Faith Estimate from your lender a sufficient amount of time prior to closing to enable you to carefully review them and promptly resolve any disagreements or disputes with the lender concerning the terms of your loan.
Because of the numerous difficulties that can arise during the loan process, you should remain in close contact with your mortgage lender and our office. Last minute delays in closing can usually be avoided if you determine in advance what conditions must be met by you. Also note that the vast majority of delays in real estate transactions are caused by disagreements over loan conditions and delays in loan funding. Please ask your lender/mortgage broker to forward the loan closing package to our office no later than 48 hours prior to closing.