The Real Estate Closing Transaction

For buying investment property, the end of the rainbow finally takes place at the real estate closing. This is where ownership of the property is formally passed from the seller(s) to the buyer(s).

If all agreements between the parties are satisfied, then the title (or ownership) of the property changes hands. It's quite a milestone, because it is normally the largest financial transaction that takes place in most people's lives.

Typical closing transactions:

• A copy of the HUD settlement statement is provided to the parties.

• The deed to the property is signed and executed.

• Insurance for the property is provided to the lender.

• A certificate showing that there are no outstanding liens or encumbrances against the property is provided.

• All real estate taxes and utilities that have been paid for by the seller(s) are prorated. Gas, electric and water meter readings are recorded on the day of the closing.

• Keys to all apartment units and common areas are provided to the buyer(s).

• Verification of all tenant security deposits and pre-paid rents is provided to the buyer(s).

• Copies of all existing tenant leases are furnished to the buyer(s).

• All closing costs are paid in full.

• The mortgage note is executed (signed) by the buyer(s).

• Balance of the purchase proceeds for the property is furnished to the seller(s).

So, that’s the basic general outline of what can take place at a closing for investment property real estate. It's important to note that closing requirements may vary based on individual circumstances and local customs.

For more in-depth information on real estate closings as they relate to buying investment property, please visit The Landlord's Library book collection. It's the ultimate resource for information on the entire subject of residential landlording.

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Buying Investment Property