First-Time Home Seller
You have decided to sell your home. You have been through this process before and have experienced the purchasing side. Now, the shoe is on the other foot. Below is a short synopsis of guiding you through the sale of your home and being prepared from the beginning.
Where do we start?
You have made the decision to sell your home. Do you go it alone? Not what I would recommend. You need to understand the market. You need to bring in those interested Buyers to take a look at what they can have, then have the experience to negotiate to meet that sale price you are hoping for. If you go it alone you may short change yourself. Your property may stay on the market for a longer period of time. You may accept an offer much less than your property is worth. A good, professional, and experienced agent is what you need to assess the market value of your home in the area you live in, effectively market your home to bring in those interested Buyers, and successfully negotiate the terms of your sale.
You need the professionals on your side to guide you through the process. You have enlisted a real estate professional. Great! Consult with your attorney at the same time. Learn, educate, and better prepare yourself prior to accepting the multitude of offers lined up to avoid issues down the line during inspection, title, review, and pre-closing. Being prepared and understanding what lies ahead in your real estate transaction once you have accepted an offer from a Buyer to purchase your home will make the difference.
An offer has come in and you have accepted it. Your attorney has reviewed the contract of sale and may have negotiated terms during your three-day attorney review period which both parties have agreed to concluding attorney review. What’s next? A few steps will come after attorney review as we proceed towards your closing date. Per the terms of your contract, a deposit may be made to be held in your attorney trust account. The Buyers will schedule their inspections which will be coordinated through your agent. The Buyers will proceed with their mortgage application for purposes of obtaining their commitment. The Buyers will order title for review for purposes of obtaining insurable title.
The Buyers inspections can give rise to issues which can affect your deal. Inspections may leave the Buyers better informed of the condition of the home which their untrained eyes could not see when making their offer. The Buyers will have a home inspection which may consist of a wood destroying insect inspection and radon test. Especially in New Jersey, I recommend that Buyers have an underground oil tank sweep of the property to determine if there is any existing underground tank on the property. If the property uses a septic system, the system should be inspected. The home inspection will address any possible mold, asbestos, major systems (heating, cooling, plumbing, electrical), structural, and safety issues that may be present. If there is mold in certain areas, you may have water and leakage issues. Asbestos is commonly found as wrapped insulation for heat distribution pipes, tiles or siding, among other areas. Termites, carpenter ants, and other pests can become an issue as the infestation can cause structural damage. The inspector will note any nonfunctioning or damaged heating, cooling, plumbing, and electrical systems. Levels of radon which exceed an acceptable level of 4.0pCi/l is a safety hazard which would need to be properly remediated. Underground oil storage tanks found on the property may result in removal and soil remediation if the tank removal fails and soil contamination is determined. Septic systems report may find defects in the treatment tank, conveyance system, and/or the absorption area. Suffice it to say, inspection repairs can be costly. Be prepared and know what to look out for. Your real estate attorney is in the position to review the inspection reports and negotiate terms of repairs or credits suitable to you which may prevent the Buyers from backing out if inspection issues do arise. If the inspections are successful with no issues present, you are one step closer to closing.
What are your responsibilities?
Any agreed upon repairs must be addressed prior to closing. Repairs and/or remediation will require the hiring of licensed professionals and obtaining the required permits and/or certificates of approval from the town or health department. Documentation will be provided to your real estate attorney once received.
In addition, you will be required to obtain town inspections in order to sell. All municipalities require a smoke/carbon monoxide detector inspection for issuance of a certification. However, not all municipalities require a continued certificate of occupancy. Speak with your realtor and real estate attorney to confirm whether it is a town requirement. If so, you realtor or attorney will assist you in having the town inspection scheduled. The town inspector will come out to the property and inspect your home based on your town’s criteria. If inspection issues arise, the town will require you to address the issues presented and have the home re-inspected for completion before they will issue the continued certificate of occupancy. Once the certifications are issued, get them over to your attorney.
Review of title.
Once the title commitment has been provided, your real estate attorney will review the title commitment with you and the items needed in preparation of closing. As standard practice, we request prior owner title policies to omit certain open items on title. We review title and note the chain of which the title passed on from one owner to the next, any outstanding mortgages, mortgages not yet discharged of record, tax liens, outstanding water and sewer, etc. All items required for preparation of closing will be reviewed with your attorney and provided to the Buyers’ counsel and the title company in preparation of closing.
You have addressed all inspection repairs and obtained all certifications required from the town. You have provided all requested title items. The Buyers’ mortgage commitment has been issued. The Buyers’ lender and title have cleared your transaction to close. Conveyance documents have been prepared by your real estate attorney and have been approved. The parties are ready to close. The real estate attorneys on both end will coordinate a closing date and time.
Lastly, the Buyers will complete their final walk-through of the property prior to closing. Make sure to maintain your property, free of damage, debris, and garbage. Leave it in broom clean condition. We don’t want any hiccups prior to closing.
Now we are ready. Let’s get this closed!