Inspection and Appraisals
Buyers will have the property inspected by a licensed home inspector usually within 10 days of mutual acceptance.. Some buyers may have several different inspectors look at the property, sometimes they will want to obtain professional opinions from inspectors, contractors or even engineers that specialize in a specific area (electrical, roof, HVAC, structure). If the buyer is relying on lender financing, then there will be appraisal by a licensed appraiser to determine the value for the lending institution (they are looking to protect their investment).
The Closing Agent.
A title company will be chosen to examine and insure clear title to the property. After researching the complete recorded history of your property, they will certify that 1) your title is free and clear of encumbrances (mortgages, leases, encroachments, restrictions, liens, etc) before the date of closing; and 2) all new encumbrances are duly included in the title. The closing agent will take care of all the paperwork, signings, transferring deeds, paying off mortgages and taxes and making sure it is recorded at the county.
There will most often be contingencies which are conditions that must be satisfied before a contract becomes legally binding, for example, a buyer will usually include a contingency for a satisfactory home inspection report from a qualified inspector.
Before completing the purchase of your property, the buyer will go over all aspects of the property, as provided for by purchase and sale agreement and any applicable addendums. These will usually include
- Obtaining financing and insurance;
- Reviewing all pertinent documents, such as preliminary title reports and disclosure documents; and
- Inspecting the property. The buyer has the right to determine the condition of your property by subjecting it to a wide range of inspections, such as roof, termite/pest, chimney/fireplace, property boundary survey, well, septic, mold, lead based paint, HVAC, etc.
Depending on the outcome of these inspections, one of two things may happen:
1. Each event is successfully closed and the contingencies will be removed, bringing you one step closer to the closing; or
2. The buyer, after reviewing the property and the papers, requests repairs based on the inspector’s recommendations or a renegotiation of the terms of contract (usually the price).
How you respond to these requests will determine if the buyer will continue on to buy your home or walk away. A professional listing agent can make a big difference in the outcome of the transaction, they have dealt with similar issues in the past,and can help with your decision-making process.
Loan Approval and Appraisal.
Buyers should have a lender’s pre-approval, approval letter, or written loan commitment, which is a better guarantee of loan approval than a pre-qualification or no documentation from a lending institution. An appraisal will be ordered from the buyers lender to make sure that the sales price is appropriate to protect to lender’s investment.