Finally, you’ve agreed on the particulars of the offer. You decided that even though the buyer’s offer was a bit lower than your asking price, he was willing to pay for the inspection and a portion of your closing costs, making it desirable. Usually, the seller signs the purchase agreement first, followed by the buyer. Once both have signed the real estate contract, it is legally binding for both parties. The buyer will put down earnest money. Those funds will be held in a third party account (escrow) until the deal closes when it will be transferred to cover part of the buyer’s down payment or his closing costs, as long as all goes well. If the buyer backs out, you may be able to keep the earnest money because you have lost time and possibly other buyers while your home has been under contract.
You will probably be asked to provide a home-inspection that proves the home has no significant flaws that would be expensive for the buyer to fix. An example might be that there are serious leaks at each valley on the roof and the inspection reveals that there are three layers of roofing, which is not okay! It will cost a small fortune to have the roofing stripped, disposed of, and a new roof applied. Some buyers will want a contingency that allows them to back out of the contract if something like this comes to light during an inspection, which could be a setback to the deal. You may agree to lower the price of the sale or agree to pay for a new roof instead of the buyer leaving the contract; it’s up to you.
The fixtures and appliances must also be addressed. Do you want to take that new washer and dryer you got on a great deal at Costco to your new home? Or is it okay to let the buyers keep them? Regardless of how you feel about appliances, you will need to make sure it is spelled out in the contract exactly what will remain with the sale of the house and what will make the journey to your next home with you.
As the seller, you will find in your contract that you will normally be paying for your agent’s fee, escrow fees, a title search, recording fees, transfer tax, title insurance, and more. Your agent will be able to offer advice and explain the various fees associated with your sale prior to the closing.
Additionally, you will want your contract to stipulate a closing date that works for you. Sellers often set time frames of a month, 45 days, or even two months to get everything in order for a move. Sometimes, a buyer may have moved to the area to begin a new job, his family is in a hotel (including two teenagers), and the family NEEDS to move into this home yesterday! If that’s the case, and you are prepared to leave, you can agree to shorten the time before closing, but you should realize that it is difficult for the buyer to get financing and documents ready to close in fewer than three or four weeks.
If all has been smooth sailing, you’ve got a few weeks to prepare for closing and saying goodbye to the house that has served you well. Your closing date is on your calendar and it’s time to celebrate!