a buyer's offer has been accepted, the deal goes through an escrow
process for about a month. During this period, an escrow
company or title insurance company transfers ownership of the
property from the seller to the buyer, after making sure that
all of the terms of the contract have been met. These companies normally charge about 1-2% of the purchase
price of the house. Part of this is paid by the seller
and part by the buyer, usually according to local custom.
my experience, the escrow process is the easiest part of
selling a house. The escrow officer usually calls to introduce himself
or herself and to offer to answer any questions. During the
escrow period, you'll get preliminary reports and documents, some of
which you'll need to sign. After escrow closes, you (and your
lender) will each get a final report and a check.
you've accepted an offer, your neighbors will be dying to
find out the sales price. Don't tell them. If
the deal falls through, you won't want outsiders to know
what price you were willing to accept.
It's very important that you fill out all
required disclosure forms honestly and completely. If you fail
to disclose a problem with the house, the buyer could sue you for
damages and even
get the sale rescinded. Here are some tips:
- If you're not
represented by a broker or lawyer, ask your
escrow officer what disclosures are required in your local area.
Get copies and fill them all out.
everything you can think of that's wrong with the house.
- State facts
and avoid interpretation. If
there's a stain on the living room wall, don't say that
"There's a big stain" or "There's a small stain" or "There's a
water stain." Just say, "There's a stain."
contract will usually require that, at minimum, these people inspect your
house: a pest inspector, a home inspector, and an
appraiser. As a FSBO seller, it's fine for you to be in
the house during the pest
inspection and appraisal, but don't tag along or challenge any findings. It's
best that you not be around for the home inspection.
a pest or home inspector finds problems with the house,
the buyer may have the option of walking away from the deal
unless the problem is fixed. Contracts often specify who
will be responsible for repairs. For example, the seller
might be required to spend up to a certain percentage (e.g., 3%)
of the sales price to correct problems. If the contract
isn't clear, you may need to negotiate with the buyer over who
should pay. If you've gotten a good price for the property, the buyer
may insist that you pay for all repairs. If the offer
was low, you might require the buyer to pay for all repairs.
you need to make repairs, get them done as soon as
possible. Your home will usually need to be re-inspected
before escrow can close.
buyers might not get their loan approved if the house
"doesn't appraise"-- that is, if the appraisal is so
far below the sales price that the lender won't approve a loan
large enough to close the deal. If you feel the appraisal
is wrong, review it to make sure the appraiser's assumptions are
accurate. If they aren't, gather evidence of this and
present it to the loan officer. If that fails, one remedy
is for the buyers to make a larger down payment. Another
is for you to reduce the sales price.
you know when escrow is going to close, notify all the utility
service providers (gas, electricity, trash, water, cable, etc.)
to let them know the cut-off date.
Alden, 2008. All rights reserved.