WHAT TO EXPECT WHEN SELLING YOUR HOUSE | BEFORE YOU CLOSE
At this point, you have accepted an offer on your house and are under contract with a buyer. Congrats! There are few more hurdles to jump through before you can get to the closing table. So don’t get too excited just yet. Lets review!
If you are purchasing a new house after this one sells, hopefully by now you and your agent have identified several properties to go look at. We share a folder with our clients inside our app when we first list the house. That way we have plenty to view even if some of those houses they liked went under contract. Doing it this way helps avoid any stress or pressure to search for a new home when you have to sell your current house first.
Check out the video we did covering our home search app and how to gain exclusive access here.
Most offers come with an option period for the buyers, also known as the inspection period, and typically last from 7-10 days from the day the contract was signed by both parties. During this time the buyers will hire an inspector to come out and find any deficiencies with the property. If a deal falls apart, most of the time it’s during this period.
When the buyer receives the report from the inspector they may or may not ask you for some repairs on the house. They could be small repairs, or major ones. It just really depends on what the buyer wants and what’s wrong with the property.
You have a few options here. You can agree or disagree with the repairs, counter their repair request, or contribute money towards the buyers closing costs in lieu of any repairs. The best thing to do really depends on the situation at hand. So it’s best you have a conversation with your agent on what you could expect a buyer to potentially ask for you to repair in your house and the best way to approach it.
Alright, once you make it past the option period it’s pretty much easy going for you from there. We have a couple small hurdles to jump through, but we got past the big one. No matter what sales price a buyer offers you, the lender will still require an appraisal to be done. Unless of course it’s an all cash deal.
If the house was priced appropriately, you shouldn’t have any issues with an appraisal. But, if you were priced on the high side and received an offer, this could be a nail biter. You are at the mercy of an appraiser that’s going to tell the lender how much the property is worth and that’s how much the lender will finance.
If the appraisal comes in short (below contract price) you have two options; come down to the appraised value or re-negotiate the sales price if the buyer is willing. That’s the keyword, if the buyer is willing. If you don’t come down to the appraised value, they could back out of the deal if it’s within the contract. Just something to keep in mind when you decide on how to price your home for sale.
BUYERS FINANCING & CONTINGENCIES
You got past the appraisal! Yay! Now it’s a done deal, right? Not so fast. Still a few hoops to jump through. I will say though, if you made it to this stage you have a high chance of getting to the closing table. However, things happen.
The buyer still needs to get the clear to close from their mortgage lender. Hopefully the buyer’s agent and the lender properly vetted their client before they went house shopping. If they did, you shouldn’t have much to worry about and should expect to hear that they received the clear to close soon.
One thing you should have known before you even accepted the offer is if the buyer had a house to sell before they purchase yours. If their house doesn’t sell or the buyer can’t obtain financing this will create a domino effect wreaking havoc across the board.
Under normal circumstances, I wouldn’t advise our sellers to accept a contingency like this unless the buyers were already under contract and possibly out of their option period. Communication is paramount with everyone involved when it comes to this, that way no one is left guessing.
WHEN TO START PACKING – GETTING SERIOUS
You should’ve at least started the packing process when you began the decluttering process before listing your house. Now you need to get serious about getting things ready for your move. Hopefully by now you are under contract on your new house and closing soon, if you are buying. If you are not purchasing you should already have a plan for where you are moving your stuff or where you’re going.
I would start packing things up as soon as you get out of the option period and really buckle down after the appraisal comes in. That way you aren’t tasked with doing everything at once and tacking on unnecessary stress.
Contract to close can be stressful, but it doesn’t have to be. Use this article as your guide throughout the process. Our hope is that by educating the world on the selling process, it will make for a pleasant and enjoyable experience for everyone involved.
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Don’t forget to check out the next video in our what to expect series: Closing And Beyond.