As the seller, this is the day you will transfer the ownership of the property to the buyer, receive the sales proceeds and pay any mortgages. If you are planning to use the proceeds immediately after the sale has been concluded, and then it is only logical to ensure that the sale proceeds smoothly.
Closing refers to the time when the buyer and the seller have both fulfilled all the terms in the contract. Therefore, closing refers to the transfer of documents and money between the seller and the buyer.
It is also at this time that the seller pays off all the loans that he had carried on the house, and also pays all the people or groups that had facilitated the sale of the house.
If the seller had committed to doing some repairs or any maintenance, this is when all of those issues are fulfilled. Closing is also referred to as settlement because it is at this moment when the buyer, the seller, and all the other involved parties settle among themselves and fulfill all the issues that had been stipulated in the contract.
In order to make the process secure, all the processes done at the closing point are done simultaneously. The settlement agent is supposed to present all the necessary documents, money and any other items which are needed during the closing session and gives them to both parties.
The settlement agent should also pay all the required money to clear the title, pay lenders, lien holders, and pay all the other agents and other parties that might have provided any services during the entire process.
Before any of couples can get the proceeds from the sale of the house, the mortgage must be paid.
Any capital gains tax that might apply during the sale must also be paid first. In the end, all those charges will normally work to the disadvantage of the seller.
Whenever a buyer backs out of the deal, he has a right to reclaim his earnest money. Earnest money is the money paid about one to three days after the seller has accepted the buyer's offer.
Depending on the terms stipulated in the contract, the buyer can back out of the deal even if the inspector has not found any major problems with the house.
However, depending on how the inspector contingency has been drafted, the buyer may be required to cite any issues that contributed to him backing out of the deal and also give the seller a chance to fix the problem.
Inspection contingency is supposed to protect the buyer, but the buyer should not make halfhearted offers since, during that period, the seller might be missing the opportunity to work with other customers who might be interested in the property.
When potential buyers start giving their offers, then both of you will share the responsibility of reviewing the offers from the potential buyers. However, in the end, both of you will have to make the decision. The final step is deciding on how to divide the proceeds.