What Sellers Need to know for Home Inspections
- Plan to leave your home an hour early
- Take pets with you
- Leave keys for crawl space, attic, gates, outbuildings, and electrical boxes
- Make sure valves to exterior faucets are open (not winterized).
- Leave remotes for garage door, ceiling fans, lights, etc.
- Turn on pilot light for gas-fired appliances, including the water heater and fireplaces
- Make sure all utilities are on
- Take laundry out of the washer and dryer
- Remove dishes from the sink and dishwasher
- Leave a sketch identifying the location of a well or septic tank
- Leave paperwork for any maintenance, repairs, or insurance claims
Note: The inspector will charge for a return trip to complete an inspection, if necessary. With just a few honey-do items, homeowners can save themselves some headaches and extra costs.
Electrical: Inspectors will check to see if the electrical panel is labeled. Replace missing plates on electrical boxes such as switches and receptacles. Replace burnt out light bulbs as needed. Ensure all smoke detectors are operational.
Plumbing: Make sure all tubs and sinks are draining properly. Clear drains with a snake or liquid plumber. Tighten loose equipment such as vales, shower heads, etc. Caulk as necessary. Toilets should be secured to floor and not wobbly.
HVAC: Check/change filters. If you had recent service work done leave the invoice for the inspector to see.
Exterior: Clean gutters and debris from roof. Gutter downspouts should have elbow, splash pan and/or flexible extension to get the water away from the home. Trim back vegetation at 12 inches from the home.
Other: Check garage door safety equipment. Clean debris from sensors and align as necessary. Make sure the inspector can easily move around the garage area, thoroughly inspect the floors and walls. Check to see that all windows and doors are operational. It is common to find windows that are painted shut.
House Closing Process for Sellers: What to Expect
This article is courtesy of our partners at Zillow.
ATL Real Estate Services REALTORS are proud Zillow Premier Agents.
You’ve accepted an offer on your house, signed a purchase agreement, and now you’re waiting to close. Congratulations! But there’s still a list of things you need to do before the closing — when the sale is official, and you hand over the keys to your house in exchange for a check.
Here’s what you need to know about the house closing process for sellers.
How long does the closing process take?
A home closing generally takes 21-45 days, depending on loan type, financing and buyer or seller preferences. A house sale that closes in 30 days means the process was super smooth, with no deal-derailing problems revealed in the inspection and no financial hitches for the buyer.
What happens during the closing process?
Here’s what will happen during the house closing process for sellers in that month or two between accepting an offer and signing the paperwork that makes the sale official.
1. The buyer puts earnest money into escrow.
Earnest money is a cash deposit paid by the buyer to prove they’re serious about buying your home. It typically amounts to 1 to 3 percent of the home’s sale price, and the buyer puts it into a holding account called the escrow. The earnest money is applied to the down payment or the buyer’s portion of the closing costs when the deal goes through.
2. The buyer’s lender begins the loan underwriting process.
Underwriting is the sausage-making part of mortgage approval. It’s when the lender verifies the buyer’s income, assets, debt and size of the loan requested to decide if the buyer is a good credit risk.
3. The title company searches property records.
The buyer’s agent orders a review of public records, called a title search, to make sure you legally own the property and are able to sell it. Think of it as a provenance check for a house.
4. The buyer orders a home inspection.
The buyer hires a professional to make sure there are no problems with the property that affect its value or safety. Not all buyers request an inspection contingency but it is a common stage of the closing process. Some sellers opt to complete a pre-inspection which could cause the buyer to waive this step. Generally, sellers are not present for the buyer’s inspection.
5. The buyer’s lender orders an appraisal.
The lender hires a professional to make sure the property is worth the amount of money it’s loaning the buyer to purchase it. An appraiser will estimate the home’s fair market value based on its features and prices of recently sold comparable homes in the neighborhood. An appraisal coming in low may cause delays in the closing timeline.
6. A final walk-through.
Typically 24 hours before closing, the buyer and his agent will walk through the house one last time to make sure it’s clean, undamaged and emptied of your possessions.
7. Finish the deal by signing paperwork.
This is the official closing day! You sign the house over to the new owner and get your money.
The final step in your house sale will only take about an hour, but you must come prepared. Be sure to write down the date, time and location for your closing. Missing a closing would be like missing your wedding: A no-show is a deal breaker. Be sure to bring: a government-issued photo ID, house keys, any paperwork your escrow agent or attorney asked for and a checkbook just in case.
You’ll sign a lot fewer legal documents as the seller than you did as a buyer, when you probably got hand cramps from initialing every other page in a four-inch-thick stack of papers. Your signing responsibility will be limited to the closing statement, an affidavit of title, the deed and the bill of sale. Be sure to read everything closely before you sign it. Make sure the information is 100 percent accurate.
What closing costs do I need to be ready for?
As a seller, closing costs can vary depending on the contract. In Georgia, the Seller is usually responsible for broker fees for both the listing broker and selling (buyer’s) broker. Refer to your brokerage contract or ask your agent for details.
Other seller costs are outlined in the accepted contract. If you’re just getting started in your seller journey, know that your agent will be able to help you stay on track during the closing process.
Preparing for Appraisal as a Seller
The buyer’s lender will have your home appraised and if the home doesn’t appraise for the agreed contract price, the lenders will not give the buyers a loan. This insures the lender that if the buyer is unable to make their mortgage payments, the lender takes the home and uses it to pay the loan. For this reason, the lender will want to make sure the amount they lend the buyer is as close to the value, or less, of the home as possible. If the house appraisal is too low, the buyer may submit an amendment to the seller to reduce the sale price, or the buyer may make up the difference with their own money.
Fortunately, there are some things we can do to help avoid a bad appraisal. Most appraisers welcome input from us and we will prepare a thorough package of information about your home to give to the appraiser. This will include data on comparable homes and any improvements you’ve made that increase the value of your home.
Scheduling the Appraisal
You will have time to prepare for an appraisal as a seller. You will be notified once the appraisal is scheduled; however, we recommend preparing for the appraisal once you have a binding contract with a buyer.
The mortgage lender will order the appraisal once the buyer signs and returns the initial loan disclosures. The contract outlines the exact number of days the lender and buyer must provide an appraisal. The appraiser or appraisal management company will schedule the appraiser’s inspection after the buyer pays for the appraisal. Appraisers gain entry into the home via the lockbox that your REALTOR places on the door.
Inspect Your Property
Inspect your home with an unbiased eye before the appraiser’s visit. Look for anything alarming and address it immediately. Appraisal inspections are not home inspections. Appraisers do not assess the home’s functionality and working condition; however, they are the lender’s eyes and ears. Appraisers are obligated to report any concerns that may warrant further inspection.
For example, an appraiser may take pictures of cracks in the walls, notate doors that stick, and ultimately recommend a foundation inspection. Address alarming items before they become issues.
Let’s be very clear: we are not suggesting anyone mask known defects. We’re simply recommending that sellers address non-issues to remove the possibility of misinterpretation.
Create an Appraisal Packet
Your REALTOR will create an informational packet for the appraiser since you won’t be in direct contact with the appraiser. Remember, it’s very difficult to fight a low appraisal, so a strong appraisal information package can go a long way in helping a property appraise for contract value.
It’s important that you provide any information about the home and neighborhood that may influence value to your REALTOR. The additional information is helpful and lends itself to a more accurate value assessment.
Providing Comps and Explanations
The appraiser will compare your home to other homes that have recently sold in the neighborhood. These are called “comparable” homes (or “comps”). The appraiser will use the MLS to determine how to determine the appraised value. Appraisers and in many cases, your REALTOR, doesn’t know all of the backstories behind the neighborhood sales. Inform your REALTOR of distressed sales due to job loss, divorce, death, etc. Provide any information about neighboring houses that may be relevant, such as condition, known defects and improvements.
Don’t let discounted homes lower your appraised value. Appraisers may be able to dismiss those lower comps if other comps are available.
Provide Comps Not in MLS
Provide your REALTOR with any recent sales that were not listed in MLS. Work with your Realtor to determine what information is available to the appraiser. Non-MLS sales are usually not available to the appraiser, and this information can be key in determining value. If you know the buyers or seller, we recommend you attempt to call those current owners (or past sellers) and see if you can get a copy of the Closing Disclosure (CD) so the appraiser can use that comp.
List Your Home Improvements
Provide your REALTOR a list of upgrades, repairs and improvements, including timing, cost and (if available) receipts. This will ensure that the appraiser is aware of all the amenities to the house. Let them consider every feature for the determination of value.
If Your Appraisal Comes in Low
In most cases the buyer will ask to renegotiate a new, lower purchase price that meets the appraised value. However, in a competitive market of multiple offer situation, the buyer may choose to increase their down payment to meet the new loan-to-value down payment minimums or use cash to cover the appraisal gap.
Some lenders can dispute the appraisal; however, it’s 100% based on the lender and appraisal appeals have a very low success rate. Depending on the type of loan, the buyer may choose to switch lenders. The worst case scenario, if the contract stipulates an appraisal contingency, the buyer will have the right to terminate the contract and have their earnest money returned.