Once the loan has been approved and the down payment is being made, this earnest money deposit is credited towards the purchase price of the home. The closing documents are prepared and the closing officer oversees the signing between you and the buyer. When the loan has been approved and financing is verified, you receive the buyer's down payment, and the signed closing documents are handed over to the lender. The lender then releases your file to the title company to be recorded with the County Courthouse. The lender accounts for all money, and forwards funds to closing officer, who disperses them.
Funds are distributed, transaction is closed, and title changes hands.