There are a lot of tasks involved in a real estate closing. This is the portion of the transaction where you settle all last-minute matters before the home finally becomes yours. Contingencies must be completed to make the transaction becomes official, and they cover a lot of different factors. Realtor.com explains a few of the contingencies that could come up as a part of the real estate contract.
Before you buy a home your lender might require you to have it appraised. An appraisal provides an accurate view of the market value of the home, which is then measured against the sale price. In the event the market value is lower than the current sale price, the buyer will be allowed to walk away from the deal. Additionally, the buyer can secure his or her deposit without the worry of forfeiting it. Appraisals are performed by third-party companies to ensure impartiality.
Buyers are also obligated to have a home inspection performed. A home inspection protects the buyer because it could potentially uncover serious issues with the property. If this is the case the buyer can request that repairs be paid for by the seller or that the sale price is reduced to make up for future repair costs. The buyer also has the option of backing out of the sale if the seller refuses to handle repairs.
There is also a chance that your original mortgage will fall through. In this case, you’ll be given a specific period of time during which you can seek to secure a new loan to cover financing. In the event you’re unable to secure other financing, you’ll also have the option of walking away from the sale altogether.