Inspections and Appraisals
Most buyers will have the home inspected by a licensed property inspector within the time range specified in the effective purchase contract. If they want professional opinions from inspectors who specialize in a specific area (e.g., roof, HVAC, structure), some purchasers will have multiple different inspectors look at the property. If the agreement is contingent on financing, the property will be appraised by a licensed appraiser to determine the value for the lending institution through a third party. This is done so that the lending institution can confirm the accuracy of their investment in your property. If the lending institution requires it, a purchase of a commercial property may additionally have a full environmental audit and/or soil test performed.
The Closing Agent.
The closing agent’s job is to examine and insure clear title to real estate. After researching the complete recorded history of your property, they will certify that 1) your title is free and clear of encumbrances (eg. mortgages, leases, or restrictions, liens) by the date of closing; and 2) all new encumbrances are duly included in the title.
Contingencies.
A contingency is a condition that must be met before a contract becomes legally binding. For instance, a buyer will usually include a contingency stating that their contract is binding only when there is a satisfactory home inspection report from a qualified inspector.
Before finalizing his or her purchase of your home, the buyer evaluates every aspect of the property, as specified by purchase agreements and any applicable addendums. These 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, pool/spa, arborist, mold, lead based paint, HVAC, etc.
Depending on the outcome of these inspections, one of two things may happen:
- Either each milestone is successfully closed and the contingencies will be removed, bringing you one step closer to the closing; or
- The buyer, after reviewing the property and the papers, requests a renegotiation of the terms of contract (usually the price).
When a renegotiation is needed, how do you respond objectively and fairly to the buyer while working in your best interests? Joan can make a significant difference in the outcome of the transaction. We guarantee our experience and complete commitment to every customer.
Loan Approval and Appraisal.
We suggest that you accept buyers who have a lender’s pre-approval, approval letter, or written loan commitment. This is a better guarantee of loan approval than a pre-qualification or no documentation from a lending institute. Expect an appraiser from the lender’s company to review your property and verify that the sales price is appropriate.
