A Summary of NC Real Estate Closing Information by a licensed real estate attorney and Managing Broker/Owner of a Real Estate Brokerage Firm in North Carolina
Real estate closings are handled differently in every state. The end result, though, is the same. The Seller and Buyer enter into a Contract; and the Seller transfers ownership of the property the Buyer at closing.
It is the process that is different from state to state; and this can be confusing if you are accustomed to the process used in other states. This article summarizes the basics about North Carolina Real Estate Closings and offers a few suggestions to minimize the frustration of buying a home or vacant land in NC.
In North Carolina , closings are usually handled by attorneys who specialize in real estate. In many other states, closings are handled by title or escrow companies; and in those states, the title search might be farmed out to lawyers or real estate paralegals.
Historically, because real estate attorneys are involved, title insurance premiums are low in NC compared to other states. When you add up the attorneys fee and the title insurance premium for a closing in North Carolina , the total is comparable and in most cases lower than in other states.
In North Carolina, the real estate attorney usually does quite a bit of work, including these things: reviews the sales contract, performs a title search that covers a 40 year time period, checks for liens and past due taxes, prepares a title report so that a title company will issue a title binder, reviews and prepares certain documents including a loan package, prepares a Settlement Statement, coordinates and conducts the actual closing, updates the title, records the Deed and Mortgage, prepares a final title report for issuance of a title insurance policy, reviews the title insurance policy and sends the original recorded Deed and other documents back to the buyer. In many other states, these different jobs are often farmed out by a title or escrow company; and many times, a lot of these different jobs have separate fees that can really add up.
Your real estate agent can give you the names of qualified closing attorneys in your area. Once you have a few names and recommendations, pick an attorney with these things in mind:
- Hire a real estate lawyer based on his or her qualifications, experience and background - not based on the fee charged. If anything, a lower fee is an indication that your closing will be handled poorly or by a law firm that operates a real estate closing "factory". Buying real estate is a huge investment for most of us. Don't skimp on representation. The downside is too big of a risk.
- Do not hire a lawyer to handle your real estate closing without speaking to him or her before you engage them to do the work. This is your opportunity to ask questions and raise any concerns that you have about the process. You might not speak to the lawyer again until closing, and that's OK. If you have spoken to the lawyer prior to the actual closing, though, he or she will take a greater interest in you. It's just human nature.
- When you talk to the lawyer, ask any questions that you have about surveys, title insurance, scheduling, and what to expect in general. You are not required to attend the closing in person if you make the appropriate arrangements ahead of time. If you cannot be present for the closing, tell your lawyer during this conversation. Also, ask for the name of an assistant or other point of contact in the law office. Finally, get any instructions from the lawyer about bringing funds to your closing. For example, if you are going to wire funds to the closing, the lawyer will have to help coordinate the wire transfer on or before the closing date.
- Forming a professional relationship with a good real estate lawyer will benefit you down the road. You will also need a real estate lawyer to handle any refinancing that you do on your property, as well the sale of the property at a later date. If you use the same attorney time after time, you will find that you get a better deal on legal fees. Plus, you will have someone to call if you ever get a speeding ticket!!
Noel B. McDevitt , Jr. is the Managing Broker of McDevitt Sotheby's International Realty in Southern Pines/Pinehurst, North Carolina , and is an Attorney licensed in North Carolina. Prior to entering the real estate brokerage business, Mr. McDevitt practiced real estate law in North Carolina and owned a law firm which concentrated in real estate and corporate law. He does not practice actively and does not handle real estate closings, but he can advise you when working with McDevitt Sotheby's International Realty.
He can be reached at (910) 693-7901, by e-mail at firstname.lastname@example.org.