There is a lot of mystery surrounding the sale of a home. Many people don't know what happens after they accept an offer and before the transaction closes. Some are only concerned with what it is going to cost. Here we are going to lay out the timeline and explain exactly what happens. Keep in mind, there are going to be some slight changes depending where you are located and other transaction specifics. Ask a local realtor for the specifics, or contact Precision Home Group and we will make sure you get set up with the best Realtors in your area.
Accept an Offer
In order to start the process, we need to have an Accepted Purchase and Sale Agreement between you and the buyer. This can be stressful and take some time. I've seen sellers who accept the first offer, and I have seen negotiations go through twelve counter offers before an offer gets accepted. Keep that in mind and know that each transaction is different.
Once you get an offer on your home, you have three choices: accept, counter, or decline. You don't have to accept the offer on the table if you have reservations, but make sure that they’re logically based. If you would like to counter, you can counter over any any item in the offer. These terms include price, dates for items to be completed, and any other terms. In an offer, everything is negotiable. Once you and the buyer come to an agreement, on the offer the real work begins.
First, your agent will open title by contacting the title company, and they will begin to do their research on your property. The title company is looking for any liens or barriers that would keep your property from transferring to the new owner. Sometimes, even as an owner, you may not know there is a lien against the property, which is why it’s vital to get this done early on in the transaction.
During the same time the title report is being ordered, the buyer is going to schedule the home inspection, and it is common that the buyer will cover that cost. You want to make sure that this is scheduled fairly soon after the offer is agreed to. Once the inspection is done, the inspector will produce a report listing all of his findings. Those findings are broken down into three categories: health and life safety, significant repairs, and recommended repairs.
Once the Inspection report is delivered, the second, and typically final, negotiation of the transaction begins. The buyer and seller need to agree upon what items on the inspection report will be repaired. There will be offers and counters during this process as well. However, keep in mind that you are looking to get the major issues resolved, not cosmetic items. Once this is complete, the rest of the transaction is fairly easy, and turns into mainly paper-pushing and a hurry up and wait scenario.
Ordering the Appraisal
The next step after the repairs are negotiated is ordering the appraisal. In Anchorage, this is typically a sellers expense. This does have a long lead time involved, so the earlier you can get this ordered the better. It can take up to a couple weeks to get this completed.
After the repair negotiations are completed and the appraisal has been ordered, the following listed items will need to be ordered. These items are usually held until after the repair negotiations because some buyers and sellers can't come to terms on what is to be repaired and the deal falls apart.
Here are some other items that may apply depending on your property type:
If the home you are selling has a well and septic, that too will need to be cleaned, serviced and inspected.
Additionally, if you live in a city or municipality that needs to authorize these tests and inspections, that can add time for approval as well. It is highly recommended to get this started as soon as the inspection repairs are agreed to.
If you have a condo or homeowners association you will need to order the resale certificate. This is a document issued by your association that states you are current on your dues, displays the meeting minutes of the association, upcoming assessments, their financial state and other pertinent information.
Alongside the additional items, the seller should work to get all repairs done as soon as possible after they have been agreed to, to ensure you have plenty of time if there are hiccups along the way. Your Realtor will have trusted contractors they have worked with, if you’re looking for recommendations. Typically, it is required that all repairs are done by a licensed contractor.
The last document you will need to order is the updated as-built. This is a revised drawing of your property with all structures and updates indicated and measured. This looks like a plot map for your property, completed by engineers, who measure your property to make sure everything is located and identified. This is then filed at closing in the recording office with your title.
Prior to closing, you will want to cancel all of your utilities and homeowners insurance for the day of closing. The buyer will be working with their lender to finish underwriting their loan for your property while the rest of the paperwork is being processed. Once this is complete, you will be cleared to close and set a time to meet at the title company and sign all of your documents. Once all this is done you are ready to close and record on the sale of your property!
There may be additional steps for your transaction, so always check with your Realtor to build out a timeline and see what needs to happen. If you have further questions about this process, feel free to reach out to me at firstname.lastname@example.org.