Key takeaways
- Title clearance is the seller's main obligation between contract and closing.
- Property taxes, HOA dues, and utilities are prorated to the closing date.
- Your mortgage payoff includes interest through the payoff date, not through your last payment.
- Review the settlement statement before closing day, not at the table.
What happens after acceptance
Escrow opens, earnest money is deposited, and the title company begins a title search covering the chain of ownership, liens, judgments, easements, and encumbrances. Meanwhile the buyer completes inspections, orders the appraisal, and moves through final underwriting.
Your obligations are to provide access, complete required disclosures, respond to repair requests, and resolve title issues. Most sellers have little to do for two to three weeks and then several things at once.
Clearing title
Common title problems include unreleased liens from paid-off loans, contractor mechanics liens, unpaid property taxes, judgments against someone with a similar name, boundary or easement issues, and gaps in the recorded chain from an inheritance or divorce.
Most are resolvable, but some take weeks — locating a lender's release on a loan paid off years ago can be slow. Order a preliminary title report early if you suspect complications, especially on inherited property or homes with a history of refinancing.
Prorations, payoff, and the settlement statement
Property taxes, HOA dues, and sometimes utilities are prorated as of the closing date. In states that bill taxes in arrears, sellers typically owe a credit to the buyer for the portion of the year they occupied the home. In states billing in advance, the credit runs the other way.
Your lender issues a payoff statement good through a specific date, including per-diem interest. It will exceed your loan balance. Review the settlement statement at least a day before closing — arithmetic errors and stale figures do occur, and fixing them at the table delays funding.
Frequently asked questions
When do I actually get my money?
Typically the same day or next business day after recording, by wire or check. Some states are dry-funding states where recording happens before disbursement, adding a day.
What do sellers typically pay at closing?
Commissions where applicable, owner's title policy in many states, transfer taxes, prorated property taxes, HOA transfer fees, any negotiated credits, and the mortgage payoff. Commonly 6% to 10% of sale price.
What if the buyer's financing falls through?
If they terminate within the financing contingency, they recover earnest money and you return to market. This is why financing strength matters when evaluating offers.
Sources & further reading
- American Land Title Association, title search and clearance standards
- Real Estate Settlement Procedures Act disclosure requirements
- State transfer tax schedules
Figures and rules change. Verify current requirements with the issuing agency or a licensed professional before acting.