The primary purpose of a closing statement is to summarize the transaction. This document plays a crucial role during the real estate closing process, as it provides a comprehensive overview of the financial details involved in the transaction. It itemizes all costs, credits, and debits that affect both the buyer and the seller, giving everyone involved a clear understanding of how much money will change hands and how the final figures were arrived at.
A closing statement typically includes details such as the purchase price, loan amounts, deposit amounts, and various fees related to the sale, such as those for inspections, title insurance, and real estate commissions. By summarizing these elements, the closing statement serves as a critical reference for ensuring that all terms are met and aids in the transparency of the transaction for all parties involved.
This clarity helps prevent misunderstandings and disputes, making the closing process smoother and more efficient.