Sellers - Offers, Contracts & Closing

OffersAndContracts.jpgWhen you receive an offer on your house it is essential you understand everything it includes. Your main focus should be the bidding price. Every seller wants to get the highest possible dollar for their home but it is important to be reasonable. Work with your realtor to evaluate the market value of your home and determine if the bid is fair. You should also calculate your net proceeds an offer will leave you with once the transaction is complete, taking into consideration all expenses and fees you will need to pay and determine if the amount of cash you will receive from the sale is worth it.

When evaluating an offer, keep in mind that price is just one of the things that can be negotiated. You also need to review any contingences and terms the buyer has included. Does the proposed closing date work with your timeline? Are the buyers asking you to cover all closing costs? What other things are they requesting that will add to your expenses? Your agent can help you work through each item and decide if certain terms should be negotiated.

After reviewing an offer, sellers have three options: accept the offer as is, reject it all together, or submit a counteroffer to the buyers with the changes you want. A counteroffer may demand a higher sales price or a different closing date, or specify which terms a seller will and will not comply to. A counteroffer could be bounced back and forth a number of times as both sides make adjustments to terms they desire. Each time one side submits revisions, the other side is free to accept, walk away, or counter again. Once the seller and the buyer have reached a mutual agreement, an offer is signed and becomes a binding sales contract.

When a sales contract is accepted, both parties are legally bound to meet all the terms within the agreement for the sale to close. For example, if the seller does not make the repairs listed as their responsibility in the contract, the buyer has the power to withdraw from the sale. Most sale contracts entitle the buyers to have a final walk-through prior to closing so they can ensure the property has been vacated and in the condition detailed in the agreement.

Officially sealing the deal does not happen until closing. While the buyer’s stack of paperwork required for closing is much larger than the seller’s, the seller is still responsible for having all their i’s dotted and t’s crossed. Your real estate agent will help you gather and prepare all the required documents prior to closing day to ensure everything happens smoothly and on time.

WHAT A SELLER IS REQUIRED TO BRING OR SIGN AT CLOSING

  • Certificate of title & the deed – These are the important documents that give you the legal right to sell the property and transfer ownership to the buyer
  • Mortgage loan payoff – A document showing information regarding the loans you will be paying off at the closing
  • Bill of sale – Identifies personal property the seller agreed to include with the purchase of the home, such as appliances, window treatments, patio furniture, etc.
  • HUD-1 settlement statement – An accounting outline showing the breakdown of all the money involved in the transaction; the seller and the buyer are required to review and sign the document, approving its accuracy.
  • Personal Identification – Driver’s license, passport, Social Security Card, or other government issued ID; some law firms may also require your forwarding mailing address for future reference.
  • Any funds that may be required from you, for example: agent commission, attorney fees, and other closing costs). Many real estate professionals will encourage you to bring your checkbook as well in case any additional costs surface at the closing.
  • Don’t forget to bring the keys!