What is a 'real estate settlement'?

A 'real estate settlement' refers to the process of finalizing the sale of real estate, which encompasses several critical steps including the signing of necessary documents and the distribution of funds. This process is an essential part of the real estate transaction, as it marks the official transfer of ownership from the seller to the buyer. During settlement, various parties, such as the buyer, seller, real estate agents, and lenders, may be involved to ensure that all legal and financial obligations are satisfied. Key documents, such as the deed, mortgage agreements, and settlement statements, are reviewed and signed, and funds are disbursed to finalize the deal.

This concept is pivotal because it ensures that all aspects of the transaction are completed in adherence to local laws and regulations, providing protection and clarity for all parties involved.