For many people, buying a home is the largest single financial transaction they make. Whether you are the buyer or the seller, selling a house involves several important steps and decisions. Understanding the process and having qualified professionals assisting you will make the transaction smoother and successful for all.
The real estate broker who lists a home for sale serves as an agent for the seller. This listing agent has the obligation to keep the seller informed on the progress of selling the home and the level of interest from potential buyers. While the seller does not have to hire an agent, having such expertise available is an advantage.
Conversely, because the listing agent represents the best interests of the seller, a buyer should consider hiring an agent to represent him or her.
The real estate contract is a written agreement between buyer and seller outlining the sale's terms and conditions. This binding contract is the most important document and should include all aspects of the sale.
At the very least, the contract should contain: the purchase price and how it will be paid, a legal description of the property (which may require a survey), a clear title furnished by the seller showing no claims or liens against the property, warranties of title, the date of actual possession by the buyer, and provision for paying property taxes, utilities and the like up to the sale's closing date, or final settlement.
The contract should also include the name of the party responsible for the property until the transfer of possession occurs, an itemized list of furnishings (appliances, light fixtures, shrubbery, etc.) included in the purchase, and the basic terms of the escrow agreement. A very important provision calls for returning the down payment if the sale is not completed or the buyer's financing is denied.
Most contracts also contain contingency clauses, which make the sale conditional based on certain items, such as satisfactory professional home and termite inspections or obtaining a mortgage at a particular rate of interest. A contingency clause allows the buyer to be sure everything is acceptable before the sale becomes binding.
Because of the complexities of a real estate contract and the entire process of purchasing or selling a home, enlisting the help of a real estate attorney is a wise decision. Another important role for the attorney is the search of public land records to determine if the seller has a clear title to the land with no liens or encumbrances. Unless resolved before closing on the sale, any such lien or defect in title passes to the new owner.
Title insurance protects the purchaser from liability in any defects in the title which may not arise in a standard title search. Many lenders insist the buyer get title insurance to cover the lender's interest before agreeing to finance the sale. The owner can also purchase title insurance to have his or her interest covered.
The attorney will schedule the sale's closing date in which the buyer, seller, and real estate agents execute the financing documents, deed and settlement statements. The parties should carefully review all documents and ask any questions regarding the property before signing.
The buyer presents proof of title insurance and a certified or bank check to pay for the purchase and closing costs. Following the closing, the attorney records the warranty deed and any loan documents with the Chancery Clerk in the county where the property lies and handles any other title matters previously discovered.