What are the laws regarding settlement and possession?
Question Details: We closed on our house at 6 pm Friday so the documents won't be recorded until Monday. We're also still working on finalizing an escrow holdback agreement for repairs that the seller needs to pay post-closing. It's now Saturday and the sellers are asking for keys and access back to the property. We were under the impression that we took possession as of closing regardless of whether the docs were recorded yet or not?
That is correct: if you closed on the house (including that the sellers were paid, whether by you or by the lender via mortgage), then you got possession once closing was complete. Possession does not depend on recording, which generally cannot be done instantly; possession comes from honoring your contractual obligations and paying the seller, at which time they are reciprocally required to honor their obligations and turn over possession fully and competely to you.