Documents You Can Expect to Sign at Closing

The Personal Representative’s Deed transfers title to the real estate to the buyer. It is signed only by the seller, in her capacity as personal representative of the selling estate. This document is subsequently recorded with the clerk and recorder of the county where the real estate is located. A small fee is charged for recording the deed.

The Seller’s Settlement Statement shows all of the debits and credits involved in the transaction. A seller’s settlement statement will include the purchase price as a credit and the various costs associated with the transaction. These include the cost to obtain a title insurance policy and tax certificate, recording fees, closing fees, prorations for taxes and utilities to the date of closing, and the commission you will be paying your real estate broker. The final number will be the amount the estate walks away from the transaction with (the seller’s “net proceeds”). You will be asked to sign the settlement statement to confirm that you have read the document and understand its contents.

Foreign Investment in Real Estate Tax Act of 1980 (“FIRPTA”) Certification:  The Internal Revenue Code provides that a transferee of a U.S. real property interest must withhold tax if the transferor of the property is a foreign person or entity. In this document, the personal representative certifies that the estate is not a foreign person or corporation for which tax needs to be withheld.

Closing Instructions: If they have not already been signed as part of the transaction, Closing Instructions will be signed by the personal representative. This document provides instructions to the title company regarding providing a title commitment, preparing closing documents, disbursing funds, holding earnest money deposits, and other matters related to closing. It also states how much the title company charges for these services. The cost is usually about $400, which often is split between the seller and the buyer.

The Agreement for Taxes provides a statement of how the property taxes for the current year will be prorated between the buyer and the seller. Any property taxes that have accrued in the calendar year (or earlier) will be the responsibility of the selling estate.

The Utility Agreement states that the utilities for the property will be transferred to the buyer once the purchase of the property is closed. It also will set aside a certain amount of money to pay any utility bills owed by the seller that accrued before closing. The title company escrows a certain amount of money (usually about $300) to make sure the final utility bill can be paid on behalf of the seller. Any amounts remaining will be sent to the estate after the final bill has been paid.

In the disclosure, the title company discloses how any funds left in its possession will be dealt with. The title company will usually demand that any checks received must be cashed or deposited within 180 days of the check’s issuance date. The title company will deliver any unclaimed funds left in its possession for more than a certain period of time to the Colorado unclaimed property fund.

Wire Instructions: If you are directing the title company to wire the proceeds of the sale to the estate’s bank account, you will need to fill out and sign a wire instructions form wherein you list the account name, account number, and routing number for the estate bank account. Be sure to bring this information with you to closing, along with your driver’s license or other form of identification.

Bill of Sale: If there are any items of personal property transferred as a part of the transaction, a Bill of Sale will need to be signed to convey ownership of those items to the buyer. These items typically include ranges, microwave ovens, refrigerators, washers and dryers, and other similar items.  

The Owner’s Final Affidavit and Agreement requires the seller to declare, under oath, to the title company that there has been no work performed on the house within the past 120 days for which a mechanic’s lien might be filed against the property. It also requires the seller to state that there are no unknown leases in place for tenants on the property, there are no HOA covenant violations, and there are not any undisclosed liens encumbering the property as of the date of the sale. It also requires the seller to advise the title company that the seller has not taken out any undisclosed loans against the property. This document needs to be signed in front of a notary public. 

The TD-1000 advises the county assessor in the county where the property is located that a sale has taken place and describes the terms of the sale. The Assessor uses this information to help set property taxes in the county. It can be signed by either the buyer or the seller.