Conducting a Home Inspection
A home inspection will give you the best picture when it comes to accuracy on your home’s current condition. The inspector of your choosing will do a walk-through of both the interior and the exterior of the home, to check for any ventilation, structural, plumbing, electrical and element issues.
They will also check the condition of the appliances, such as the fridge and the oven, to ensure they are in working order as well.
Generally, a home inspection will take a couple of hours, and at the end the inspector will produce a report to you stating all of the issues that were uncovered during said inspection.
Backing Out of the Deal
Depending on the terms of your contract, there are inspection contingencies in which the buyer is allowed to back out of said deal for whatever reasons after they have gone over the inspection report.
The buyer is allowed to cite “deal breakers” within the report and further produce that to the seller, for the purpose of addressing the importance of why they are backing out of the deal. As the seller, there is a way around this. For example, say the buyer has an issue with a plumbing issue that needs to be fixed, and they would like you to fix it.
You have two options here; either fix the plumbing issue or whatever the case may be, or allow them to back out of the deal and search for another buyer. As the seller, the decision is solely up to you.
If you are serious about the deal as the seller, then do not make an offer that is purely halfhearted, considering the fact that this inspection contingency report is an important protection for the buyer. Therefore, it is not something to be taken lightly, as they are making an incredibly large investment.
Locating an Inspector
If you are working with a real estate agent, they will be able to give you information on inspectors and give you references. Always ensure that the inspector you are looking into choosing for your home’s inspection has references of their own through previous clients, are knowledgeable when it comes to conducting reports on vacant homes, for example, and that they are registered with a home inspector’s group that is reputable.
For example, you may look for an inspector who is registered with the National Association of Home Inspectors, also known as the NAHI, or the American Society of Home Inspectors, also known as the ASHI. In fact, both of these inspector’s groups include a directory for reputable home inspectors located on their website, which is easy to find through a web search.
The Cost of Hiring an Inspector
Typically, an inspector will cost between $300 and $500, but this all depends on the rates of your local area, and the size of your home itself.
A follow-up inspection by a specialist, which may be suggested from your inspector, which could help you narrow down the condition of the sewer line running from your home, or even a structural engineer, who can give you a report that is more detailed in regards to bulging or cracks to your home’s foundation, for example.
Additionally, these specialist inspectors may also cost you a couple of hundred dollars, but it’s always a good idea to have all of your bases covered, so you can have more information should you need to have any repairs done, or if you’d like the buyer to see all is well with the home so they can have a peace of mind before officially closing the deal.
What You Should Expect During a Closing
During the process of transferring ownership and your possession of the property to the buyer, you will need to be able to export multiple things. This process is generally pretty easy, as all of the hard parts have already been run through, but there are still things that you should readily expect during the process of closing.
During this process, it’s best to communicate with the buyer or the seller, depending on which you are, on a constant basis, to ensure that requirements are met when it comes to the sale agreement.
Improving or Repairing the Property
If you have told the buyer that you will be taking any action to improve the property or make any repairs, be prepared to take action right away. This can be done before or after the process of closing, it all depends on what you and the buyer have agreed on.
All endeavors that have been agreed upon should be completed by the closing, so you do not have to worry about it, but the only real general exception would be if the buyer and you have created a separate contract for any and all improvements or repairs to be completed by a certain date.
Settlement and Your Settlement Agent or Escrow
During the settlement process, where the seller, buyer, any and all real estate agents, the seller’s lender, and the buyer’s lender, will get together with all parties who have provided documents or services for the process of selling, buying and closing the deal for the home. This process is enabled and made secure through the closing task, where an escrow or a settlement agent will be hired as a disinterested third party.
The escrow or settling agent will take all of the money, documents, and any other items involved with the closing process from each party involved.
From there, the money will be paid out to clear the title, furnish, and pay off any lien holders or old lenders involved. As well, they will pay all of the real estate agents and any other service providers, such as an inspector for the home, who were involved in the overall transaction.
Where the Closing Will Take Place
The closing process will take place within the office of the escrow or the settling agent, who is typically the title’s insurance company, which insures the buyer’s title to their new property. However, should it be requested, certain escrow and title companies will send a mobile escrow for the purpose of handling the closing process in a location which is convenient to all of the parties involved with the transaction.
In some cases, however, the lender of the buyer will host and close while acting as the escrow, or they will bring in an escrow or notary company employee to act as an escrow. The buyer’s attorney, or the seller’s, either or, can offer his or her office, but restrictions involving client trust accounting can make this impossible for either attorney to disburse the funds straight away, which is where an escrow company will handle all of the transferring funds.
Otherwise, the escrow will take on the closing responsibilities, where they will take and disburse all of the funds while explaining each document. They may even draft all or some of the necessary documents, but only if the escrow is an attorney who is licensed. “Witness only” closings are for an attorney or a notary who will go to the closing location, which is selected by the seller and the buyer to provide all of the disbursement services and documents on behalf of the buyer’s lender.
Although, the attorney, and the notary will not explain any of the legal effects of the documents, which includes the closing itself. Such closings will typically occur in the office of a licensed attorney.
The Seller Attending the Closing
The seller, unlike the buyer, who will generally attend the closing for the purpose of signing all original loan documents which are delivered to the lender to the closing, may choose not to attend the closing if they do not wish to.
As the buyer, do not be surprised if the seller does not show, considering he or she is not required to do so. The seller may choose to pre-sign the deed, as well as any other transfer documents that are involved in the closing, which refers to the conventional table closing or escrow closing.
The seller can also give the buyer’s attorney the power to sign any and all incidental documents in regards to the escrow, where all of the sale proceeds could be directly wired to your newly purchased home escrow, or to your bank account. However, this is only allowed should the buyer be purchasing the home on the same day, or quickly after, the overall sale and closing has been completed.
Once the Closing Has Been Completed
Once the closing process has been completed, and the escrow has proceeded to pay off all lien holders, such as your lender, and service providers, pays the overall sales proceeds that are intended to go to you, places the deed and the mortgage, if applicable, for the record of the country recorder of deeds, and gives all other documents for transfers to the buyer, the closing process has been completed.
Once the closing process has been completed, you as the seller must relinquish all possession of the home, and all keys, which include all keys to all doors, garage door openers, and any device or key which controls the home’s appliances and systems. At this time, you will have already been expected to have your belongings removed from the home unless the house was vacant while you were going through the process of selling. The home must be spotless, as well, or the buyer can create a lawsuit against you for breaching the sales contract.
Therefore, doing an additional walk-through of the home yourself, without an inspector, is ideal, so you can be sure that all your loose ends have been tied up. This should be done before the buyer has the final opportunity to go through the home themselves to ensure that the condition of the home has not changed whatsoever since the initial sale agreement was signed.
If they should have any issue with the state of the home, regardless of how small, it’s your responsibility to handle any complaint that they may have. This may include dishing out additional funds to handle whatever the problem is. Therefore, you should be one step ahead of the buyer and take one last walk-through yourself to ensure that there are no surprises, such as a frozen pipe in view that could burst because the house is vacant without the heat being on.
The Process of Closing Your Home
Once all of the work with your real estate agent has been finished to find a suitable and potential buyer, go through the negotiations process, and conduct a sale agreement, the closing process of selling your home is, in fact, the easiest part. This part may take some extra time, depending on the availability of all of the parties involved, but rest assured, this process takes less stress and hair-pulling than the rest of the process.
Contact Real Estate Agent & Attorney, Arthur Simpson today!