In real estate transactions, what does the term 'closing' refer to?

The term 'closing' in real estate transactions specifically refers to the completion of the property sale transaction. This is the stage where all necessary documents are signed, funds are exchanged, and ownership of the property is officially transferred from the seller to the buyer. During the closing process, various activities take place, including the final review of contracts, payment of closing costs, and the recording of the deed with the appropriate governmental authority.

This process is critical as it represents the culmination of negotiations and agreements made between parties throughout the buying/selling process. Events leading to this point include the signing of the purchase agreement, fulfillment of contingencies, and arrangements for financing. Thus, the closing signifies a legally binding conclusion to the real estate transaction where both parties fulfill their obligations, resulting in the new ownership status.