Offer to Close

What Happens Now?

There are a lot of moving parts and people that need to come together for the purchase and sale of a home. Here is an overview of what the process generally entails:

Accept an Offer

If they would like to buy your home, buyers will prepare and submit a Purchase and Sale Agreement (PSA for short). This is the document they prepare that outlines all the components and conditions regarding the purchase and sale of the home. This is a legally binding document, so it is very important that you understand what they are offering. As the seller, you can either reject, counter or accept the offer.

Deposit Earnest Money

An earnest money deposit helps communicate that the buyer is serious. It is typically 1-3% of the purchase price and is deposited into an escrow account to be held until closing. Earnest money (or EM) is refunded to the buyer in the event certain contingencies are not met and the deal is terminated. You keep the buyer's earnest money if they fail to perform and you decide to terminate the PSA.

Home Inspections

Buyers can make their offer dependent on the results of home inspections. This is called an inspection contingency. Inspections allow buyers to get a more thorough look at the property, and will often be followed by a resolution period where the buyer will propose a renegotiation of terms such as repairs or purchase price. As a seller, the inspection report will not be forwarded to you, but proof of repair items may be requested off the report.

Appraisal

Appraisers are objective third-party professionals hired by lenders to verify that the home is worth the money the buyer is borrowing. The appraisal report belongs to the buyer and lender, and the results are not shared with the seller. If the home appraises at value, the home is worth the agreed upon purchase price and the deal can continue. If the home does not appraise, this opens the door to negotiation between buyer and seller, but if a solution cannot be agreed on, it could be the end of the deal.

Final Walk-through

The purpose of the final walk-through is to verify that the home is in the same or better condition than it was when the buyer first went under contract and/or after the inspection period and any negotiated repairs. This usually happens a day or so before closing.

Closing

When all contingencies such as inspection, appraisal and financing have been satisfied the only item left is executing the final documents. Closings typically take place at an attorney or title office and takes about 45 minutes to an hour. Bring your ID and a well-rested hand – you’ll be dotting a lot of “i’s” and crossing a lot of “t’s”! If possession of the home is the same day as the closing, your keys will be handed over to the buyer that day and funds will be distributed!

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