Whether you’re selling or buying a house, closing is one of the most stressful times in the real estate process. Sellers are hoping to seal the deal quickly to prevent the sale from falling through, and buyers are hoping to move into a new home right away. Unfortunately, there are many steps to closing a deal in real estate, so be prepared for this entire process next time you’re buying or selling a house.
Offers and negotiations are the first step to closing on a house. At this point, the buyers and sellers will discuss factors that go into the offer, such as recent renovations or repairs that need to be made. Who pays the closing costs will also be negotiated over at this time.
Around the same time as negotiations are being made, there will usually be an inspection, which the offer may be contingent upon. The inspector will search for any safety concerns, as well as any illegal components of the property, such as an improperly-built addition. Sellers should be aware that a deal can fall through due to a poor inspection.
After your inspection is complete and your offer is made, you will need to get an appraisal. The laws surrounding appraisals vary from state to state, so make sure to discuss this process with your real estate agent. Again, depending on the state, a low appraisal could cause a deal to be revoked.
People who get pre-approved for a loan should have no problems at this stage, but those who have yet to be approved could find that they are unable to meet their offer amount. To make this process go smoothly, buyers should get a pre-approval, and sellers should try to work exclusively with those who have pre-approvals.
Once every other step is finished, it’s time for the title to transfer to the new owner. Real estate agents use title insurance companies to ensure this transfer goes smoothly.
After all of these steps are completed, the journey is done and the ownership of the home is now in the buyer’s hands. Whether you’re buying or selling, be prepared for this process to take a few weeks, and also be prepared for problems to arise. If you’re prepared for each of these steps, your real estate transaction should go well.