The Contract and Closing
There are several things to think about before you enter into a sales contract with a potential buyer. There are also timely steps to follow once your property is “under contract”. The information here is an overview of the contract and closing. We stay in close contact with our sellers to help coordinate and explain the closing process as well as meet the requirements outlined in their specific contract. Contact us for your real estate needs or refer this site to a friend! 

7 Terms to Watch for in a Purchase Contract

In addition to these things provided by the National Association of Realtors®, you may also want to look at the Home Inspection, Termite and Heating & Air sections of the contract to determine who will be responsible for repairs.

1. The closing date. See if the date the buyer wants to take title is reasonable for you.
2. Date of possession. See if the date the buyer wants to move in is reasonable for you.
3. The earnest money. Look for the largest earnest-money deposit possible; since it is forfeited if the buyer backs out, a large deposit is usually a good indication of a sincere buyer.
4. Fixtures and personal property. Check the list of items that the buyer expects to remain with the property and be sure it’s acceptable.
5. Repairs. Determine what the requested repairs will cost and whether you’re willing to do the work or would rather lower the price by that amount.
6. Contingencies. See what other factors the buyer wants met before the contract is final—inspections, selling a home, obtaining a mortgage, review of the contract by an attorney. Set time limits on contingencies so that they won’t drag on and keep your sale from becoming final.
7. The contract expiration date. See how long you have to make a decision on the offer.

Reprinted from REALTOR^® Magazine Online by permission of the NATIONAL ASSOCIATION OF REALTORS^®
Copyright 2005. All rights reserved. www.REALTOR.org/realtormag       

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Moving Tips for Sellers

1. Give your forwarding address to the post office, usually two to four weeks ahead of the move.
2. Notify your credit card companies, magazine subscriptions, and bank of the change of address.
3. Develop a list of friends, relatives, and business colleagues who need to be notified of the move.
4. Arrange to have utilities disconnected at your old home and connected at your new one.
5. Cancel the newspaper.
6. Check insurance coverage for moved items. Usually movers only cover what they pack.
7. Clean out appliances and prepare them for moving, if applicable.
8. Note the weight of the goods you’ll have moved, since long-distance moves are usually billed according to weight. Watch for movers that use excessive padding to add weight.
9. Check with your condo or co-op about restrictions on using the elevator or particular exits.
10. Have a “first open” box with the things you’ll need most—toilet paper, soap, trash bags, scissors, hammer, screwdriver, pencils and paper, cups and plates, water, snacks, and toothpaste.

Reprinted from REALTOR^® Magazine Online by permission of the NATIONAL ASSOCIATION OF REALTORS^®
Copyright 2005. All rights reserved. www.REALTOR.org/realtormag 

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Plus, if you’re moving out of town:

1. Get copies of medical and dental records and prescriptions for your family and your pets.
2. Get copies of children’s school records for transfer.
3. Ask friends for introductions to anyone they know in your new neighborhood.
4. Consider special car needs for pets when traveling.
5. Let a friend or relative know your route.
6. Carry traveler’s checks or an ATM card for ready cash until you can open a bank account.
7. Empty your safety deposit box.
8. Put plants in boxes with holes for air circulation if you’re moving in cold weather.

Reprinted from REALTOR^® Magazine Online by permission of the NATIONAL ASSOCIATION OF REALTORS^®
Copyright 2005. All rights reserved. www.REALTOR.org/realtormag       

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6 Items to Have on Hand for the New Owners

1. Owner’s manuals for items left in the house.
2. Warranties for any items left in the house.
3. A list of local service providers—the best dry cleaner, yard service, etc.
4. Garage door opener.
5. Extra sets of house keys.
6. Code to burglar alarm and phone number of monitoring service if not discontinued.

Reprinted from REALTOR^® Magazine Online by permission of the NATIONAL ASSOCIATION OF REALTORS^®
Copyright 2005. All rights reserved. www.REALTOR.org/realtormag   

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Home Inspections

Check your specific contract, but most contracts give the purchasers 10 business days to have the home inspected by qualified professionals and an addendum submitted to the sellers.  The 10 business days are measured from the date the contract was accepted by both parties.  This timeline is very important.

This “Home Inspection Phase” is another round of negotiations. Unless a home is being sold “As Is” or the contract does not allow it, the buyer can ask for the seller to remedy certain items or for more time to have certain inspections performed. The buyer’s agent will usually deliver or fax the home inspection and the addendum outlining the requested repairs. As your seller agent, we will go over the requested repairs with you. There are strict timelines for responding to home inspection requests. Consult the contract section on Home Inspection for details.

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Wood Infestation Report /CL-100 (Termite Letter)

Most contract to purchase residential real estate in the Columbia area will ask the Seller to make needed repairs to obtain a clear/clean CL-100 (termite letter). These reports cover much more than termites, such as wood rot, excessive moisture, fungi, and the like from the flooring down to the ground.  They do not cover such things as detached buildings, eaves of homes, or wood rot around garages. Refer to your sales contract to see if the seller or buyer is responsible for the CL-100 and any needed repairs.

These reports are obtained by having the home inspected by a licensed pest control company. After the inspection is completed, any needed repairs must be done in order for the letter to be considered “clear or clean”.  The CL-100 inspection should be performed about 30 days before closing.  These letters should be faxed to the attorney approximately 3 days before the closing. Either a bill to be deducted at closing or a paid receipt must accompany the letter as well as any repair invoices.

As our seller client, we will discuss the CL-100 and any needed repairs with you in more detail.

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Heating & Air Conditioning Inspections

Most contracts to purchase residential real estate in the Columbia area will ask the Seller to make repairs to obtain a “clean or clear” Heating and Air letter. Generally, the party paying for the inspection has the option of selecting the company to perform the inspection. Refer to your contract to see who will order the letter (buyer or seller) and pay for any needed repairs.

The Heating and Air letter should be done within 15 days before the closing.  These letters are not warranties or guarantees; they just make sure the unit(s) is working properly at the time of inspection. Each unit in the home will need a clean Heating and Air letter. The original letter should be given to the attorney at closing. Of course, as our clients, we will go over this with you in more detail once you have an offer to purchase your home. Keep in mind, most contracts ask the seller to pay for the letter and any needed repairs.

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Power of Attorney

Some buyers and sellers will not be present at a closing and will request someone else to be present and sign for them. An attorney will usually charge $100 to $150 to prepare a specific Power of Attorney.  The attorney handling the real estate closing should be able to answer your questions about the Power of Attorney process.

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When to Move Out

Your Contract of Sale will address the terms negotiated between the purchaser and seller as to when occupancy will be given over to the purchaser. Most contracts state that occupancy will be given to the buyer 24 hours after closing.  However, in some instances this is negotiable.  Please review the occupancy portion of the contract to determine when you need to vacate the property!

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The Walk-Through

Most real estate contracts allow for a final walk-through a day or two before closing.  The purpose of this walk-through is only to determine that the house is in the same condition as when you negotiated the contract and that the agreed upon repairs have been completed. Refer to your contract to see which appliances, window treatments, etc. remain with the home. Most things attached remain with the property, such as built-in bookcases, lights, fans, mailboxes, lamp posts and other things attached. Just ask us if you are unclear on which items are “personal property” instead of “real property.”

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Utilities

When residential property is sold, all utilities need to be transferred out of your name and into the buyer’s name. Utilities can include electricity, gas, water, phone, cable and garbage. 

As a general rule, electric companies require the seller to request service to be taken out of their name prior to accepting an order to place their service in the new owner’s name.  Buyers and sellers usually try to coordinate transferring of utilities to avoid a reconnect fee…and so the buyers aren’t moving into a home without water or electricity!

Try to call the utility companies a week before closing and request all utilities be taken out of your name the day possession is given to the buyer (usually the day of closing or 24 hours after closing.)

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Seller Closing Cost

Here are some of the fees/costs that could be associated with selling your home. Each transaction is unique.

1. Document Prep Fee
2. Deed Stamps
3. Real Estate Commissions
4. Prorated Taxes, Utilities, Home Owner Association Dues, etc.
5. Copy / Courier Fees
6. Possible Mortgage Pre-Payment Penalties
7. Fees to Record the Mortgage as Satisfied
8. Repairs
9. Termite and/or Heating & Air Inspection Fees
10. Home Warranty for Buyer
11. Seller contribution to Buyer Closing Cost

This list is not inclusive and varies from seller to seller. We have a closing cost estimator that we will use to give you as ESTIMATE of the costs associated with selling your home. We work closely with our seller clients to explain the process and work to achieve the highest possible sale price!

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The Day of Closing!

Bring your drivers license to the closing.

The attorney and their paralegal prepare a Real Estate Settlement Procedures Act (RESPA) statement (HUD) a day or two before closing. This statement is a standard form that has two main columns, one for the purchaser and one for the seller. The HUD should list all of the transactions relating to the closing. For example, if the Pest Control company charged $150 for the termite inspection, you should see an entry for $150 on the HUD in either the buyer or seller column depending on your contract.

The attorney collects the money from the pertinent parties and then disburses checks as needed. For example, if you are paying you’re the termite and heating and air companies at closing, the attorney will collect that money and then cut and mail the checks to the appropriate companies. The monies could come from the proceeds from the sale. If you do not have proceeds from the sale of your closing, you could be asked to bring money with you to closing.

The attorney will address any questions you may have and explain the closing documents to you. We also enjoy going over the HUD with our clients before closing. In the past, we have caught errors on the HUD form, saving our clients money!

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Referring Your Realtors®

One of the best things you can do to show your appreciation to any professional is to refer their services. If you are happy with the level of our service and your transaction, we would love for you to pass our names on to your friends and families.

One reason we wanted to utilize this web site is to give our clients a non-intrusive way to refer our services. Please email our web address to anyone you know interested in buying or selling a home. At their leisure, they can browse our site to get a better feel for us and the services we provide our clients.

We hope you have enjoyed working with us. I am sure SkinnyAgent.com has helped you with “The Skinny on Real Estate!”

Sincerely,

Chip & Kendra Mosteller - SkinnyAgent.com
Proud members of the Asset Realty, Inc. team