Buying or selling a home is one of the most rewarding milestones in life, but before the keys are officially exchanged, there’s one crucial final step: the closing process. In Maryland, closing involves a series of detailed procedures that ensure both the buyer and seller complete their obligations, funds are transferred properly, and ownership officially changes hands.
What Is the Closing Process?
Closing, sometimes called settlement, is the final step in a real estate transaction. It’s when all the legal, financial, and logistical details come together to transfer ownership from the seller to the buyer.
In Maryland, the process is typically handled by a licensed title company or real estate attorney. This professional oversees the paperwork, disburses funds, and ensures the title is properly recorded with the state. While it may sound complex, a skilled agent and settlement team can simplify every step for you.
Preparing for Closing as a Buyer
For buyers, preparation is key. Before the big day, you’ll need to review several critical documents and complete a few important tasks:
Review Your Loan Estimate and Closing Disclosure
Your lender will provide a Loan Estimate early in the process and a Closing Disclosure at least three business days before settlement. These documents outline your loan terms, closing costs, and monthly payment details. Take time to review them carefully and ask questions—small errors can delay closing.
Complete Your Pre-Closing Checklist
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Schedule your final walkthrough to ensure the home’s condition matches the purchase agreement.
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Confirm homeowners insurance coverage is in place.
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Arrange your cash to close via certified funds or wire transfer.
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Bring your photo ID and any lender-required documents to settlement.
A good rule of thumb: don’t make any major financial changes, like large purchases or credit inquiries, right before closing—they can affect your mortgage approval.
Download a full checklist here
MD Buyer Pre-Closing Checklist
Preparing for Closing as a Seller
Sellers also have a key role in making closing day go smoothly. Here’s what to focus on:
Review the Pre-Closing Checklist
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Make sure all agreed-upon repairs are completed.
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Gather warranties, appliance manuals, and receipts to leave for the buyer.
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Confirm utility transfers and forwarding addresses with service providers.
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Ensure all mortgage payoffs and liens are ready for settlement.
Your title company will prepare a seller’s closing statement showing your proceeds after commissions, payoffs, and taxes are deducted. Review it carefully and ask your agent or settlement officer about anything unclear.
Download a full checklist here
MD Seller Pre-Closing Checklist
Understanding Who’s at the Closing Table
Maryland closings often include several professionals working together to ensure accuracy and compliance. These may include:
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Buyer and seller (and their agents)
- Buyer and seller attorneys (not required)
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Lender’s attorney
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Settlement officer / Closing agent
Each person plays a specific role, from verifying identity to transferring funds and recording the deed. Having a knowledgeable team like Delaware & Company coordinating these moving parts helps prevent costly errors or delays.
Title Transfers and Common Issues
Title work is one of the most important, and sometimes complicated parts of the closing process. Maryland’s property laws require a clear and marketable title before ownership can transfer.
However, title problems can occasionally arise, including:
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Unreleased liens or judgments
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Boundary disputes
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Unpaid taxes or HOA fees
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Errors in public records
Your title company will perform a title search to uncover any issues and issue title insurance to protect you against future claims. For distressed properties such as foreclosures, short sales, or REO homes, extra title review may be needed due to prior ownership complications.
Taxes and the Maryland Closing Process
Taxes can affect both sides of the table during a Maryland closing.
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Sellers are often responsible for state transfer and recordation taxes, though these may be shared depending on local customs or negotiated terms.
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Buyers typically pay property taxes from the closing date forward, prorated for the remainder of the tax year.
Additionally, sellers may qualify for certain home sale deductions if the property is their primary residence. In most cases, up to $250,000 ($500,000 for married couples) of capital gains may be excluded from taxes if ownership and occupancy requirements are met. Your tax advisor can help clarify your specific situation.
Common Closing Day Issues and How to Avoid Them
Even the most organized transactions can face last-minute challenges. Some common issues include:
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Missing signatures or unsigned lender documents
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Incorrect wiring instructions or delayed funds
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Repair disputes discovered during the final walkthrough
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Recording delays due to title or deed errors
At Delaware & Company, we help our clients avoid these pitfalls through early document reviews, proactive communication with title partners, and thorough coordination with lenders. The goal is always a calm, stress-free closing day.
The Final Step: Recording and Keys
Once all documents are signed and funds have cleared, the title company will record the deed with the county clerk, officially transferring ownership. Buyers receive their keys, sellers receive their proceeds, and the transaction is complete.
This recording step is what legally finalizes the transfer without it, ownership is not yet official. In most Maryland counties, recording happens within one to two business days after settlement.
After Closing: What to Expect Next
For buyers, post-closing is when the fun begins settling into your new home, updating your address, and setting up utilities. Keep copies of your signed documents for tax and insurance purposes.
For sellers, closing marks the end of one chapter and the start of another. Ensure you receive your final proceeds and confirm your mortgage is marked as paid in full. Your real estate agent can also help you plan your next purchase or relocation.
