When Your Home is Under Contract to Close
Once you and the buyer agree on terms and sign the contract, the buyer will give the copy of the contract to his/her lender and formally pursue financing. Your REALTOR® may monitor the loan process, which could last several weeks. During this time, your REALTOR® will also be busy coordinating other arrangements to prepare for the final sale.
As part of the process, the title company may order a survey of your property and research the title to your home, making sure the chain of title is clear. Clearing the title may require paying off liens–that is, any monetary claims against your property. Examples are: mechanic’s liens, unpaid state and federal tax liens, HOA dues, court judgments, and probate considerations (if a co-owner has died). In Utah, the seller purchases a Title Insurance Policy conveying a clean and clear title to the new buyer.
The contract requires that the seller delivers a Seller’s Property Condition Disclosures within its own associated deadline. This document provides important information about the seller’s knowledge and history of the condition of the property. Complete the notice to the best of your knowledge and belief. Your REALTOR® will most likely ask that you complete the notice at the time the listing is first taken. Copies of the completed notice will be made available to those looking at your property.
If your property was built before 1978, federal law requires that before a buyer is obligated under a contract to buy the property, the seller shall: 1) provide the buyer with a lead hazard information pamphlet (as prescribed by EPA); 2) disclose the presence of any known lead-based paint or hazard; 3) provide the buyer with a lead hazard evaluation report or records available to the seller; and 4) permit the buyer to conduct a risk assessment or inspection for the presence of lead-based paint or hazards. A contract for the sale of property built before 1978 must contain a statutorily prescribed Lead Warning Statement to the buyer. Your REALTOR® will provide you with the forms necessary to comply with the law and will suggest procedures to follow in order to comply.
Then there is the Buyer Due Diligence deadline. If the buyer requires it, his/her agent can coordinate an inspection of your home. A buyer may hire an inspector to review many items in the property such as the structural components, mechanical items, electrical systems, and plumbing systems. The inspector will report to the buyer the items that the inspector finds to be in need of repair. Most likely, the buyer will provide a copy of the inspection report to you and may ask you to complete certain repairs. Don’t be surprised if the inspection notes some items in need of repair. An inspector is trained to see items and defects that are not obvious to you and your REALTOR®. No matter how new or well-maintained a home is, an inspector always finds some items in need of repair.
Once the home has been appraised and financing has been secured, the sale formally ends at the Settlement table of a title company office. Your REALTOR® and the buyer’s agent may be present. A title company officer or escrow agent will preside. Everyone signing needs to be sure to bring two forms of identification to the closing, one form being either a driver’s license, DPS identification card or passport.
The sale actually consists of two transactions: 1) transferring the property to the buyer, and 2) paying off the existing mortgage on your home (or allowing the buyer to assume your mortgage). To transfer the property, the title company will present documents proving that you have the title. Proceeds of the sale may be disbursed at closing or shortly thereafter, once all the paperwork and verifications have been processed. When the buyer’s money “funds and records”, you give your house key to the new owners and the sale is complete.
Blog Archive2016-02-25 09:21:56
Buyers NEED a Connection
When Your Home is Under Contract to Close
Receiving an Offer on Your Home
How to Show Your Home for Sale
Understanding a Listing Agreement
Setting the Price of Your Home
Preparing Your Home to Sell
The Science of Selling