INSPECTIONS, TITLE WORK, APPRAISAL, LOAN APPROVAL

Your escrow began when you accepted a buyer's purchase offer and earnest money deposit. What follows is the inspection and appraisal of your Colorado home and the loan origination process.

The Title Company. The buyer selects a title company, whose job it is to examine and insure title to real estate. Your Turning Point Real Estate agent can help recommend one for you. You may find they offer different pricing and services that can seriously affect your bottom line and/or outcome. After researching the complete recorded history of your property, they'll certify that 1.) your title is free and clear of encumbrances (eg. mortgages, leases, or restrictions) by the date of closing, and 2.) all new encumbrances are duly included in the title. It is your responsibility to read the title work and to ensure it is correct. Legal counsel can help in this area. Your agent can assist as well.

Contingencies. A contingency is a condition that must be met. It is a legal out for a buyer or a seller depending on the structure of the agreement and a particular outcome. For instance, a home buyer will usually include a contingency stating that their contract is binding only when there is a satisfactory home inspection report from a qualified inspector.

Before completing his or her purchase of your Colorado property, the home buyer goes over every aspect of the property, as provided for by purchase agreements. These include:

• Obtaining financing and insurance,
• Reviewing all pertinent documents, such as preliminary title reports and disclosure documents, and
• Inspecting the property. The buyer has the right to determine the condition of your property by subjecting it to a wide range of inspections, such as roof, termite/pest, chimney/fireplace, property boundary survey, well, septic, pool/spa, arborist or mold, and structure to name a few.

Depending on the outcome of these inspections, one of two things may happen:

1. Either each milestone is successfully closed and the contingencies will be removed, bring you one step closer to the close, or
2. The buyer, after reviewing the property and the papers, requests a renegotiation of the terms of contract (usually the price or repair requests) or , in a worse case scenario, the termination of the contract and release of all earnest monies.

How do you respond objectively and fairly to the buyer when a renegotiation is demanded, while acting in your best interests? This is when a professional listing agent can make a real difference in the outcome of the transaction. Having dealt with various property sales in the past, we guarantee our expertise and total commitment to every client, no matter what their situation.

Loan Approval and Appraisal. We suggest that you accept buyers who have a lender's pre-approval letter, which is a better guarantee of loan approval than a pre-qualification. But, in order to have a full loan approval or loan commitment, the buyer’s lender will order an appraisal of the property. This usually will happen shortly after all inspection items have been resolved. The appraiser will determine a value for the home that tells the lender and the buyer that the home is within the sales price range that is agreed to in the contract. If it comes up under that price you may have to renegotiate the contract or exit the agreement. The buyer does not have to share the appraised value with anyone. Only that it came in at value or not.

Ready To Go? Don't pack your bags just yet. Something unexpected might happen-a buyer's offer fails to push through, or new buyers come by to visit right when your house is in chaos. There's a proper time to start preparations for moving, and given our previous experience with these transactions, we'll help you determine when that time will be.