Real Estate Closing Procedures in North Carolina

Instructor: Kyle Aken

Kyle is a journalist and marketer that has taught writing to a number of different children and adults after graduating from college with a degree in Journalism. He has a passion for not just the written word, but for finding the universal truths of the world.

The purpose of this lesson is to further develop an understanding of the real estate closing procedures set forth by the North Carolina Real Estate Commission and the North Carolina General Assembly.

Closing Procedures in North Carolina

When it comes to closing procedures, the seller must first agree to the buyer's terms. The seller has the right to counteroffer, or renegotiate the offer and the buyers have the right to deny or accept. Once the parties agree on the logistics, each party and their representatives are responsible for fully completing each procedure to make the sale final.

In North Carolina, closing procedures are heavily regulated by the North Carolina General Assembly and the North Carolina Real Estate Commission. The purpose for such tough rules and regulations is to ensure that the acquisition of a property is legal. The laws also protect the buyers and sellers from unsavory practices from their agents or brokers. Closing procedures have a two-step process, typical pre-closing and attorney-supervised closing.

Typical Pre-Closing

Typical pre-closing procedures are the procedures that occur after the seller accepts the buyer's offer. For example, Bob and Joan Harris are moving to North Carolina. Recently, Bob and Joan approached their realtor, Jake, to make an offer on a home. Jake took the Harris' offer to the seller, and the seller accepted. The next step before Bob and Joan can move into their new home is to start the pre-closing process.

The first thing that Bob and Joan must do is make an earnest payment. The North Carolina Good Funds and Settlement Act states that an earnest payment must be paid by the buyer to show the seller an intent to purchase. Their agent, broker, or lending officer will place these funds in an escrow account. Under the law, no settlement agent can disburse these funds to the seller until the paperwork has been verified and the closing is completed.

After the earnest money has been given, the buyers and the agent are responsible for ensuring that appraisals and inspections are scheduled, repair requests have been negotiated with the seller, and land surveys are scheduled. Once everything has completed, buyers should then arrange a date for final closing, switch the utilities, and arrange for movers.

Attorney Supervised Closing

In North Carolina, it is required that the buyer and seller use a real estate attorney. This is called attorney supervised closing. The attorney will draft all of the necessary closing documents necessary for the buyer to purchase the property. The responsibilities of the supervising attorney closing include:

• Performing a comprehensive title search

• Prepare a deed for the sellers

• Title insurance acquisitions

• Handles the closing contract

In addition, the attorney and real estate agent will contact the lender in order to make sure that the closing process is handled within the proper time frame.

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