What does "closing" refer to in a real estate transaction?

"Closing" refers specifically to the final step in a real estate transaction where ownership of the property is officially transferred from the seller to the buyer. This process typically involves the signing of various legal documents, the payment of funds, and the recording of the transaction in public records. At closing, the buyer receives the title to the property, and the seller receives payment, thus fulfilling the necessary conditions of the sale.

Understanding closing is crucial for anyone involved in real estate, as it marks the moment when all previous negotiations and preparations culminate, resulting in the transfer of property rights and responsibilities. Other phases of the real estate process, such as home inspections, negotiations, or financing, are significant but occur prior to this definitive transfer of ownership.