What Is a Settlement Agent?
A settlement agent is a party who helps complete a transaction between a buyer and a seller. This is done through the transfer of securities to the buyer and the transfer of cash or other compensation to the seller.
For a real estate transaction, closing agents are professionals who function chiefly for the buyer by conveying the selling interest from the buyer to the seller and ensuring the orderly transfer of the legal title from the seller to the buyer through the closing process.
A settlement agent plays a central role in ensuring a "quick close." As such, not all agents are the same. For challenging transactions, specialized skills and knowledge may be required; even a seasoned agent can be tested under the pressure of a high stake close.
Settlement agents are also known as "closing agents" or "conveyancers."
Breaking Down Settlement Agent
During the settlement of a trade in which actual securities and money are exchanged, which will occur several days after the original transaction, settlement agents are responsible for settling the accounts of traders and making the process more efficient.
With real estate, the duties of a settlement agent can extend to examining land titles for accuracy, pro-rating property fees for the current year of the transaction and interacting with local and state agencies to notify them about the transfer of ownership.
More specifically, a settlement agent is an escrow agent, real estate attorney or representative of a title company that conducts the closing or "settlement" of a home purchase transaction. Other functions include coordinating the attendance and document signing for all the parties, and the verification that each side has performed their required responsibilities as outlined in the contract. The settlement agent disburses all funds and title & deed to the appropriate parties after checking that all conditions are met at a transaction's close.