There is a lot of demand for housing right now, so you might be thinking about putting your house on the market to try to maximize the return on your home’s value. Once you list your house for sale, you will take a look at the offers you have available and select the best one. Just because you have accepted an offer doesn’t mean you will get paid right away. You need to understand how the closing process works, and you must make sure you do everything you can to streamline the process. What do you need to know about closing on the sale of a house?
Table of Contents
The Due Diligence Time Period
First, the vast majority of buyers are going to ask for a due-diligence time period. During this time, the buyer will probably order an inspection to make sure everything is okay with the house. If the buyer finds anything unusual, he or she may ask you to either fix the house or provide him or her with a credit that he or she can use to fix the house later. You do not necessarily need to agree to the repairs, but the sale might fall through if you decide not to do so. You can also ask the buyer to waive the inspection if you don’t want to wait.
Securing Financing
The closing process will take a few weeks because the buyer needs to secure financing for the home. If you want to skip this step, you may want to ask for an all-cash offer. This could result in fewer fees that you have to pay at closing, but you might also limit the offers you receive. If you decide to go with a traditional offer, make sure this buyer can actually secure financing for the home. Otherwise, the sale will fall through.
The Appraisal
If you decide to accept a traditional sale, the lender will probably ask for an appraisal. An appraisal is an approximate valuation of the value of your house. No appraisal is perfect, but the appraisal will be based on the value of other homes in your area. The appraiser will take a look at houses that are similar to yours, figure out what they sold for, and use this information to come up with an approximate valuation of your home. If the appraisal comes in too low, the lender may refuse to finance the sale.
The Closing Table
Finally, if everything goes well, you will find yourself seated at the closing table waiting for your funds to come through. You might be curious about the disbursement of funds at closing. There is usually an attorney who is responsible for this. Because the amount of money is so high, the attorney will make sure that everyone gets paid their fair share. If there is a mortgage that you are still paying, the sale will be used to pay off the balance of the loan. Then, once all the closing fees are covered, you will receive what is left. This process is usually pretty quick.
Get Ready for the Closing Process
These are a few of the most important points you need to keep in mind regarding the closing process. There are a lot of hurdles you need to overcome before you will finally receive the proceeds from the sale, so be sure to work with a real estate professional who can guide you through the process. Consider the offers carefully, select an offer from a seller who you feel has the money to afford your house, and wait for the closing process to finish.
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