Real Estate

What the Real Estate Closing Process Actually Looks Like in Practice

Did the offer that you just placed on your new dream home just get accepted? Here's what the real estate closing process actually looks like in practice.
Posted by uptownguy

In our current hot real estate market, more and more people are buying and selling their homes. Are you one of them? 

Many people think that the process is over as soon as the potential buyer puts in an offer, but there’s still plenty to do after that. The real estate closing process can take a while.

If you’re buying a dream home (or selling it), it’s important to know what to expect. Read on to learn more.

Real Estate Closing Costs

Many people who have never bought (or sold) homes before may be unaware of closing costs. It’s important to consider these costs whenever you’re making your moving budget. 

Both sellers and buyers are going to contribute to these closing costs. For sellers who are uninterested in paying closing costs and would prefer a simpler option, you can use a site like IBuySD.com to sell a home for cash without the need for negotiations or a real estate agent.

Closing costs include the cost of:

  • Appraisal
  • Home inspection
  • Attorney fees
  • Real estate agent fees
  • Credit reports

Contingencies 

Contingencies are crucial when it comes to buying or selling a home. These contingencies protect the buyer from potential problems with the selling process or the home itself. It allows them to withdraw their offer in the event that a contingency isn’t met. 

Common contingencies include

  • An acceptable (and affordable) interest rate
  • No major undisclosed problems with the home
  • No major damage due to pests
  • Sellers agreeing to make any necessary repairs

Without these contingencies in place, the potential buyer is at risk and it will be more difficult to back out of the sale. 

Inspections

All buyers should have home inspections before they sign the final agreements and documents. A home inspection can reveal serious (and expensive) issues that were undetectable to the average person.

Both general inspectors and pest inspectors should visit the home. You may also need a specialist if the general inspector doesn’t investigate electrical or plumbing problems.

These inspectors will run through a checklist to find anything that might change the overall livability of the home. The buyer can then take this information to the real estate agent who will determine whether or not renegotiating is a good idea.

Renegotiations

If there are undisclosed problems in the home, the buyer and seller will have to renegotiate. If the seller chooses not to accept renegotiation, the process stops and the buyer is able to leave. 

The seller may have to lower their price or offer to repair the damage before the buyer officially closes on the house. 

If the seller and buyer agree, they can fill out all of the required paperwork and finish the closing process.

Real Estate Deals and Closing Are Complicated

The real estate closing process isn’t as easy as it looks on paper. Buying (or selling) a house is complicated, and it’s helpful to have a good real estate agent on your side to help you navigate. 

Good luck with your real estate deal!

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