The process of buying or selling a home can be complex. Homepie makes it easy with our easy to use online tools & resources.
Keep in mind that each real estate contract has its own nuances so it’s important to read the contract carefully and abide by the provisions of your contract.
Depending on how you structured your purchase contract, there will be a few processes you may go through before you can close the sale. Most of these processes run concurrently and each process has its own deadline for completion.
Once you have fully executed purchase contract, escrow will need to be opened, the appraisal will need to be ordered, if applicable, and inspections will be scheduled, if applicable.
If you have chosen a transaction coordinator, they will open escrow. Escrow is a neutral third party that handles most aspects of the legal transfer of ownership, like the deed. They also help coordinate the transfer of money and the holding of the buyer’s deposit.
If the buyer is getting a loan, the lender will order an appraisal. The appraisal is an evaluation of the property to determine the value. If the buyer is paying cash and chose to have an appraisal contingency, the buyer will need to order the appraisal. They can choose one of our service providers or they can choose their own.
The seller is required by law to disclose any known material fact to the buyer. A material fact in real estate is a fact that, if known, may have caused a buyer to make a different decision with regards to staying under contract and completing the sale, or may have caused a buyer to renegotiate a term.
The seller will fill out some disclosure forms and provide them to the buyer within the first week or so of the deal so that the buyer can make an informed decision. This is in addition to any inspections that the buyer may order.
If the buyer decided that they would like to inspect the property, they will order the applicable inspections, or the transaction coordinator may do so. The buyer and seller will have to coordinate appointment times so that the inspectors can have access to the property.
Once the appraisal and inspections are complete, the buyer will decide if the property’s condition is satisfactory for them to complete the sale. If it is, they will need to remove the appraisal contingency and the inspection contingencies.
If the buyer has some issues with the property that could be resolved with the cooperation of the seller, the buyer may submit a request for repair. The seller is not obligated to make any repairs, however, in almost every transaction there is some sort of negotiation in this area. The seller can accept, reject, or counter the request for repair. If countering, it’s sometimes easier to offer a credit to the buyer in lieu of repairs so that the buyer can decide how they want to repair the issue and either do it themselves or hire their own contractor. Once this negotiation is complete, the buyer will need to remove their inspection contingency.
If there is an HOA involved in the sale, the buyer will have the opportunity to review the HOA’s financials, bylaws, association rules, and CC&R’s. If the buyer feels any aspect of the association is not acceptable, they will have the opportunity cancel the transaction based on a contingency.
Towards the latter end of the transaction, if the buyer is getting a loan, they will need to get their full underwriter approval. Once they have that, they will remove the loan contingency and the lender will move towards funding.
Now you are in the final stage. Once the loan funds, the escrow/title company will record the deed. Then, the seller will hand over the keys to the buyer, and you’re done!
As mentioned earlier in this article, each real estate contract has it’s own nuances. It’s important to read the contract carefully and abide by the provisions of your particular contract. Being informed and abiding by the terms of your contract will keep things compliant and will avoid many problems.