Settlement is the closing of a real estate transaction. Settlement occurs on the closing date specified in the purchase and sale agreement and the following occur:
- Buyer and their lender deliver the balance owed on the purchase price.
- Seller signs the deed and transfers keys and possession of the home to the buyer.
- The title company records the deed and any mortgages at the county recorder’s office.
- Monies are disbursed to the seller and other parties, as required by the purchase and sale agreement.
In escrow states, such as Washington, closing papers are signed separately by the parties in advance of the closing date. Settlement occurs when documents are recorded at the county recorder’s office. In non-escrow states, both parties gather and sign papers together. Settlement and transfer of monies and keys occurs at this meeting.