Closing – Signing the Contract is Only the Beginning

When you’re selling your house, it’s thrilling when the right buyer says, “I’ll take it!” and the two of you sign a purchase agreement with the agreed-upon price and all the details sorted out. Although this feels like the end of the road, it’s actually only the beginning of the end—and things can get a little bumpy before it’s all over.

I once knew a Realtor who did a closing presentation with her clients upon the signing of the contract, after which she handed them a bag of M&Ms and sparkling cider or champagne and said, “Take two of these (M&Ms) and call me in the morning.” That’s because in the weeks between the signing of the contract and the closing of the escrow, there are several ways a transaction can veer off course.

The best way to keep everything on track is to keep your buyer’s perspective in mind and to do everything you said you’d do, because even when both parties enter into an agreement in good faith, misunderstandings can derail the process.

THE FINAL WALK-THROUGH

Once the contract is signed and you’ve completed any needed repairs, the buyers get to walk through the property to make sure it is in the same (or better) condition than when you accepted the offer. Ideally, you’ve moved out by then, so the buyers can see the house, the whole house, and nothing but the house.

Without furniture and area rugs, the mold on the wall behind the hutch shows up and the gouge in the hardwood floor becomes apparent—problems you didn’t know about or had forgotten existed. The stain on the ceiling that was always there is now the only thing in the room, and therefore far more obvious.

Trust me when I tell you it’s best if these issues are addressed before escrow closes. You do not want a buyer coming back a year later, after the housing market has crashed and they decide they don’t like the house as much as they thought they would—because this is when they’re looking for an excuse to make you pay. Be forthright and upfront about any property shortcomings before escrow closes.

STICKING POINTS

If there’s a problem during the walk-through, don’t panic. Let’s say you never planned to leave the dining room chandelier because it belonged to your grandmother, and the buyers assumed it was staying with the house. When they find it missing during the walk-through, they ask about it. Don’t get belligerent. Instead, negotiate. Almost everything’s negotiable.

WHAT TO LEAVE WITH THE HOUSE

Provided the walk-through goes well, here’s a list of things to leave with the house:

  • House keys
  • Garage remotes
  • Mail keys (if you have a locking mailbox)
  • The keys or combinations to any other locks (e.g., gate, pool)
  • Owner’s manuals
  • Warranties to appliances
  • Receipts for house-related expenses
  • A list of vendors familiar with the house
  • Extra house paint (if the buyers want it)

If you really want to be helpful, create a map indicating the location of the water main shut-off, the sewer clean-out and where the electricity comes into the house. While you’re at it, label the breakers in the electrical box. Be sure to cancel your utility service as of the close of escrow. Forward your mail to your new address and send a “We’ve Moved” notice to anyone who sent you mail in the last six months. Finally, as you vacate the premises, I recommend turning off the water to the house.

If the house will remain vacant for a while, leave the porch light on and put a few lights on timers inside so it looks like someone’s home. Vacant homes can draw the wrong kind of attention.

Once the escrow closes, it’s time to bring out the rest of the M&Ms and champagne and celebrate!

If you have questions about real estate or property management, please contact me at rselzer@selzerrealty.com. If you make a suggestion I use in a column, I’ll send you a $5.00 gift card to Schat’s Bakery. Dick Selzer is a real estate broker who has been in the business for more than 40 years.



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