.Selling a home is complicated. Escrow, inspections, and appraisals – here’s what to expect:
Inspections and Appraisals
Most buyers will have the property inspected by a licensed property inspector. This should occur within the time frame agreed upon in the contract to purchase. Some buyers will have several different inspectors inspect the property. They will obtain professional opinions from inspectors who specialize in a specific area (e.g. roof, HVAC, foundation). If the agreement is contingent upon financing, then the property will be appraised by a licensed appraiser. This happens so that the lending institution can confirm sufficient collateral. A commercial property buyer may also have a complete environmental audit performed and/or soil test.
Escrow is an independent, neutral third party. They hold the buyer’s earnest money deposit until the contract terms are met and recording takes place.
Contingency: A condition that must occur before a contract becomes legally binding. For instance, a buyer usually includes a contingency stating that their agreement is binding only when a qualified inspector has a satisfactory home inspection report.
Before completing their purchase of your property, the buyer goes over every aspect of the property, as provided for 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
- 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:
1. Either each milestone is successful, and the contingencies are removed. This brings you one step closer to the closing.
2. After reviewing the property inspection and disclosures, the buyer requests a renegotiation of the terms of the contract (usually the price).
How do you respond objectively and fairly to the buyer during a renegotiation demand while acting in your best interests? This is when a top listing agent can make a real difference in the transaction’s outcome. The Harb & Co. Team is uniquely qualified to troubleshoot the most difficult of negotiations, having previously dealt with thousands of property sales.
We suggest you accept buyers who have a lender’s pre-approval. This is a better guarantee of loan approval than a pre-qualification.