What is the "closing" in real estate transactions?

The closing in real estate transactions is the final step where important documents are signed, and funds are transferred. This phase signifies the culmination of the entire home-buying process, where the buyer fulfills their financial obligations, and ownership of the property is formally transferred from the seller to the buyer. During closing, both parties generally review and sign a variety of legal documents, including the deed and the closing statement, outlining all costs associated with the sale. Once these documents are finalized, funds are disbursed, officially allowing the buyer to take ownership.

The other options describe different aspects of the home-buying process but do not accurately represent what closing entails. The initial step in a mortgage transaction involves pre-approval and application procedures, while signing a lease agreement pertains to rental agreements, and inspecting a house occurs prior to the final purchase decision, but is not part of the closing itself. Thus, the correct answer accurately reflects the definition and significance of "closing" in real estate.