diff --git a/contractcourt/chain_watcher.go b/contractcourt/chain_watcher.go
index f1786441c..38ed88d38 100644
--- a/contractcourt/chain_watcher.go
+++ b/contractcourt/chain_watcher.go
@@ -23,6 +23,12 @@ type LocalUnilateralCloseInfo struct {
 	*lnwallet.LocalForceCloseSummary
 }
 
+// CooperativeCloseInfo encapsulates all the informnation we need to act
+// on a cooperative close that gets confirmed.
+type CooperativeCloseInfo struct {
+	*channeldb.ChannelCloseSummary
+}
+
 // ChainEventSubscription is a struct that houses a subscription to be notified
 // for any on-chain events related to a channel. There are three types of
 // possible on-chain events: a cooperative channel closure, a unilateral
@@ -42,9 +48,7 @@ type ChainEventSubscription struct {
 
 	// CooperativeClosure is a signal that will be sent upon once a
 	// cooperative channel closure has been detected confirmed.
-	//
-	// TODO(roasbeef): or something else
-	CooperativeClosure chan struct{}
+	CooperativeClosure chan *CooperativeCloseInfo
 
 	// ContractBreach is a channel that will be sent upon if we detect a
 	// contract breach. The struct sent across the channel contains all the
@@ -232,7 +236,7 @@ func (c *chainWatcher) SubscribeChannelEvents() *ChainEventSubscription {
 		ChanPoint:               c.cfg.chanState.FundingOutpoint,
 		RemoteUnilateralClosure: make(chan *lnwallet.UnilateralCloseSummary, 1),
 		LocalUnilateralClosure:  make(chan *LocalUnilateralCloseInfo, 1),
-		CooperativeClosure:      make(chan struct{}, 1),
+		CooperativeClosure:      make(chan *CooperativeCloseInfo, 1),
 		ContractBreach:          make(chan *lnwallet.BreachRetribution, 1),
 		Cancel: func() {
 			c.Lock()
@@ -511,26 +515,24 @@ func (c *chainWatcher) dispatchCooperativeClose(commitSpend *chainntnfs.SpendDet
 		SettledBalance:          localAmt,
 		CloseType:               channeldb.CooperativeClose,
 		ShortChanID:             c.cfg.chanState.ShortChanID(),
-		IsPending:               false,
+		IsPending:               true,
 		RemoteCurrentRevocation: c.cfg.chanState.RemoteCurrentRevocation,
 		RemoteNextRevocation:    c.cfg.chanState.RemoteNextRevocation,
 		LocalChanConfig:         c.cfg.chanState.LocalChanCfg,
 	}
-	err := c.cfg.chanState.CloseChannel(closeSummary)
-	if err != nil && err != channeldb.ErrNoActiveChannels &&
-		err != channeldb.ErrNoChanDBExists {
-		return fmt.Errorf("unable to close chan state: %v", err)
+
+	// Create a summary of all the information needed to handle the
+	// cooperative closure.
+	closeInfo := &CooperativeCloseInfo{
+		ChannelCloseSummary: closeSummary,
 	}
 
-	log.Infof("closeObserver: ChannelPoint(%v) is fully "+
-		"closed, at height: %v",
-		c.cfg.chanState.FundingOutpoint,
-		commitSpend.SpendingHeight)
-
+	// With the event processed, we'll now notify all subscribers of the
+	// event.
 	c.Lock()
 	for _, sub := range c.clientSubscriptions {
 		select {
-		case sub.CooperativeClosure <- struct{}{}:
+		case sub.CooperativeClosure <- closeInfo:
 		case <-c.quit:
 			c.Unlock()
 			return fmt.Errorf("exiting")
diff --git a/contractcourt/channel_arbitrator.go b/contractcourt/channel_arbitrator.go
index 8a2403e5a..4ff382824 100644
--- a/contractcourt/channel_arbitrator.go
+++ b/contractcourt/channel_arbitrator.go
@@ -338,6 +338,10 @@ const (
 	// localCloseTrigger is a transition trigger driven by our commitment
 	// being confirmed.
 	localCloseTrigger
+
+	// coopCloseTrigger is a transition trigger driven by a cooperative
+	// close transaction being confirmed.
+	coopCloseTrigger
 )
 
 // String returns a human readable string describing the passed
@@ -356,6 +360,9 @@ func (t transitionTrigger) String() string {
 	case localCloseTrigger:
 		return "localCloseTrigger"
 
+	case coopCloseTrigger:
+		return "coopCloseTrigger"
+
 	default:
 		return "unknown trigger"
 	}
@@ -421,10 +428,16 @@ func (c *ChannelArbitrator) stateStep(triggerHeight uint32,
 		case userTrigger:
 			nextState = StateBroadcastCommit
 
+		// If the trigger is a cooperative close being confirmed, then
+		// we can go straight to StateFullyResolved, as there won't be
+		// any contracts to resolve.
+		case coopCloseTrigger:
+			nextState = StateFullyResolved
+
 		// Otherwise, if this state advance was triggered by a
 		// commitment being confirmed on chain, then we'll jump
 		// straight to the state where the contract has already been
-		// closed.
+		// closed, and we will inspect the set of unresolved contracts.
 		case localCloseTrigger:
 			log.Errorf("ChannelArbitrator(%v): unexpected local "+
 				"commitment confirmed while in StateDefault",
@@ -1372,16 +1385,28 @@ func (c *ChannelArbitrator) channelAttendant(bestHeight int32) {
 
 		// We've cooperatively closed the channel, so we're no longer
 		// needed. We'll mark the channel as resolved and exit.
-		case <-c.cfg.ChainEvents.CooperativeClosure:
-			log.Infof("ChannelArbitrator(%v) closing due to co-op "+
-				"closure", c.cfg.ChanPoint)
+		case closeInfo := <-c.cfg.ChainEvents.CooperativeClosure:
+			log.Infof("ChannelArbitrator(%v) marking channel "+
+				"cooperatively closed", c.cfg.ChanPoint)
 
-			if err := c.cfg.MarkChannelResolved(); err != nil {
-				log.Errorf("Unable to mark contract "+
-					"resolved: %v", err)
+			err := c.cfg.MarkChannelClosed(
+				closeInfo.ChannelCloseSummary,
+			)
+			if err != nil {
+				log.Errorf("unable to mark channel closed: "+
+					"%v", err)
+				return
 			}
 
-			return
+			// We'll now advance our state machine until it reaches
+			// a terminal state, and the channel is marked resolved.
+			_, _, err = c.advanceState(
+				closeInfo.CloseHeight, coopCloseTrigger,
+			)
+			if err != nil {
+				log.Errorf("unable to advance state: %v", err)
+				return
+			}
 
 		// We have broadcasted our commitment, and it is now confirmed
 		// on-chain.
@@ -1440,9 +1465,6 @@ func (c *ChannelArbitrator) channelAttendant(bestHeight int32) {
 				HtlcResolutions:  *uniClosure.HtlcResolutions,
 			}
 
-			// TODO(roasbeef): modify signal to also detect
-			// cooperative closures?
-
 			// As we're now acting upon an event triggered by the
 			// broadcast of the remote commitment transaction,
 			// we'll swap out our active HTLC set with the set