Closing a Home Sale
Congratulations! You’ve found a buyer, agreed to a sale price and are ready to sell your home. The long, exhausting process is almost over. Now it’s time to close the deal, so how is that done?
First, you’re going to need a title company. A title company examines the title deed, the document that gives someone ownership of the property, and looks for any issues such as disputed ownership claims or incomplete documentation. They also issue title insurance, which is usually issued to the homebuyer and guarantees against losses that come from a problem with the title.
Next, you’re going to want a lawyer, preferably one who specializes in real estate matters. Hopefully you already made contact with one, especially if you signed a contract with a real estate agent. He or she can then draw up the contract of sale and help you and the buyer work out the details, which can include items from the home included in the sale (major appliances, furniture, fixtures, etc.), the amount of the down payment, the closing and possession dates, conditions for the sale (such as the inspection), particulars of the mortgage, which closing costs are paid by whom and, of course, the sale price.
Your lawyer will also help to guarantee that this contract is fair and contains no hidden or deceptive clauses. And, he or she can advise you on tax implications from your home sale. If you are making a profit on your home sale, that’s great, but be aware that the U.S. Government is going to try to get a piece of the pie. But as your lawyer will tell you, you can generally exclude up to $250,000 in capital gains ($500,000 for a married couple) if you lived in your home for two out of the last five years. If you’ve lived in the house less than two years but are moving due to a change in job, health reasons or for other special circumstances, you can also get an exclusion.
After the contract is signed, you’re just about done. All that remains is to find some movers, hand over the keys and get out by the possession date.
For more information on selling a home and related information, check out the links on the following page.