query: what is a post closing audit?

First let me say that "post closing" means AFTER closing.  A post closing audit is an audit of the documents or file and this audit takes place after the closing.  Audits are performed by mortgage lenders, title insurance personnel, and regulators who are checking to make certain that the closing was performed correctly.

There are routine audits and there are special purpose audits.  A routine audit would be performed on each file by clerical staff whose job it is to move the file to the next stage.  Mortgage lenders set up secondary market sales and mortgage servicing.  Title insurers process recorded documents, reconcile escrow funds, and issue policies.  At each of these stages personnel are reviewing the work performed and if errors are spotted they will bring the file to the attention of management for resolution.

Special purpose audits may be a random selection of files for quality control department review or the file may be selected for an investigative audit by regulators or title underwriters.  These special purpose audits are part of oversight functions setup by the government or the company to monitor quality of service, regulatory compliance, and to keep an eye out for fraud or theft.