Getting to closing after a contract is negotiated and signed is usually the most dificult part of selling a home. This is because there is potential for many things to go wrong. Sucessfully managing the contract to close process is important for a smooth and sucessful transaction. The following are things you can expect to happen from contract to close:

Inspections. Many buyers choose to have home inspections, at their expense, when purchasing their new home. In fact, the vast majority of offers are subject to having a home inspection. By having a home inspection, the home's structural components and vital systems are checked. A home inspection allows you to sell your home with confidence. Your agent help coordinate the inspection with the buyer or buyers agent after a contract on your home has been accepted. If issues arise from the inspection you may be able to negotiate the resolution of the issue(s) involved to resolve them. Typically the seller is responsible for having, at their expense, a termite inspection.

Financing. Another contingency generally found in contract to purchase is a financing contingency. This allows the buyer time to obtain a loan for the purchase of the new home. There is usually a specific time allotted for the buyer to make application and obtain what is called an "approval" letter. Some buyers will have already gone through this process before making an offer to purchase and already have a pre-approval or even approval letter. These buyers are what we call good "qualified" buyers. For more information on what could go wrong with a buyers lender, request a copy of our Seller's Guide.

Appraisal. Contract's to Purchase are almost always contingent upon the home appraising for at least the amount of the contract purchase price. Generally the buyers lender will order the appraisal for the home. If the appraisal comes back for less than the contract purchase price there are a few options that can resolve the issue to continue to closing. First since a buyer can only get a loan for no more than the appraisal amount the buyer can choose to pay the additional amount in cash. For example, if the home appraises for $250,000 and the contract purchase price is for $255,000, the buyer can choose to get the loan for $250,000 and pay the additional $5,000 in cash.

Another option would be for the seller to come down in the contract purchase price to the appraisal amount.

Finally, the buyer and seller can agree to renegotiate the contract sales price and do a combination of the above. For example with a contract sales price of $255,000 and an appraisal amount of $250,000, the sales price can be adjusted to $252,500 with the seller coming down $2,500 and the buyer paying the over appraisal amount of $2,500 in cash.

Utilities. It is the responsibility of the seller to initiate the change of utility inforamation with the proper companies. Once the seller has set the transfer date with the utility companies the buyer can then call to have the transfer in their name. Ususally this is done when you have a set closing date or a date for move out/in. Sellers should also remember to cancel any other services that are not transferred such as cable, phone, etc...

Title Search. When a buyer and seller agree on a home or land purchase transaction, a title professional searches public records to see if any outstanding matters could affect the new buyer's rights. Title professionals research records in municipal and county facilities, or in information storehouses called "title plants," capturing and analyzing even the smallest details. These records include recorded documents such as: judgments, liens, general taxes, utility assessments, special taxes and levies, and other matters that could cost the new buyer money or, worse, affect their property ownership. This process, called a title search, provides warnings of title flaws that must be dealt with before the property can change hands. If there is a problem in the title search it can delay the closing process or cancel the contract all together. It is best to clear any liens on the home or porperty or inform your agent of them issues before you list the house so it does not come up as a surprise later and cause problems getting to closing.

Closing. So you finally get to the day of closing. Tennessee is a split closing state where generally the buyer will close in one location with one attorney/title company and the seller will close with another. You should have a time and place arranging with your closing company of when to arrive and instructions to bring your driver's license and possible a cashier's check if money will be owed (money can usually also be wired to the closing company). When you sit down with the attorney/closing agent to close the sale of the home he/she will explain the documents you are signing and allow you to ask any questions you may have. Some of the documents you can expect to sign are the Hud-1 (a document which shows where the money goes in the transaction), transfer of title, a payoff letter to your mortgage company, clear termite letter, and others documents. Once all the documents have been signed and the buyer has signed all their documents you can expect to exchange the keys to the home and receive a check from the closing company if you are due any monies.