How do I read and understand a purchase contract?
A purchase contract spells out price, deadlines, contingencies, included items, financing terms, and what happens if either side defaults. Read it section by section, paying special attention to dates, repair obligations, contingency periods, and any addenda that modify standard terms. Your agent and, when needed, a real estate attorney can help you interpret key clauses […]
What is earnest money and how does it work?
Earnest money is a deposit buyers make with their offer to show they are serious about purchasing the home. It’s usually held in an escrow account and later applied to the buyer’s down payment or closing costs if the sale closes. If the buyer properly cancels under a contingency, they typically get it back; if […]
When can a seller keep the buyer’s earnest money?
A seller may keep earnest money if the buyer breaches the contract without a valid contingency or misses key deadlines without agreed extensions. If the buyer simply changes their mind outside contingency periods, the contract often allows the seller to claim the deposit as damages, subject to local law and any liquidated damages clause. Disputes […]
What is an inspection contingency and how does it protect me?
An inspection contingency lets the buyer hire inspectors and then request repairs, credits, a price reduction, or the option to walk away if serious issues are found. It protects buyers by ensuring they’re not locked into purchasing a property with undisclosed or unexpected defects. For sellers, it’s a critical phase where you may renegotiate, agree […]
What happens at the closing table?
At closing, the buyer signs loan documents, you sign documents transferring ownership, and funds are exchanged through the title or escrow company. The settlement agent reviews the closing disclosure or settlement statement, confirms wiring instructions, and ensures all conditions are met before recording the deed. Once everything is signed and recorded, the buyer receives keys […]
What documents do I sign at closing?
As a seller, you typically sign the deed, settlement statement, closing disclosures, affidavits (such as no-lien or occupancy statements), and any payoff or release documents required by your lender and title company. In some states you may also sign local transfer forms or tax declarations. Your closing agent will explain each document briefly before you […]
How do wire transfers work at closing?
At closing, your buyer’s lender and the buyer send funds via bank wire to the title or escrow company, which then disburses money to pay off your loans and send you your net proceeds. You’ll provide your wiring instructions in writing to the closing agent and should verify them by phone to avoid fraud. Most […]
What is an exclusive right-to-sell agreement?
An exclusive right-to-sell agreement gives one brokerage the exclusive right to represent you and earn a commission if the property sells during the contract period—no matter who finds the buyer. This is the most common listing type and usually motivates the agent to invest heavily in marketing, since they’re protected if the home sells. It […]
What is a listing agreement and what does it cover?
A listing agreement is a contract between you and a real estate brokerage that authorizes the agent to market and sell your property. It typically covers the listing price, commission, length of the agreement, what services are included, and what happens if the home sells or the contract is terminated. Reading it carefully ensures you […]
How do I handle capital gains on a rental property I’m selling?
When you sell a rental, your taxable gain generally equals sale price minus selling costs, your adjusted basis, and plus any depreciation you claimed over the years. Part of that gain may be taxed as depreciation recapture at higher rates, with the rest treated as capital gains. Some investors use a 1031 exchange to defer […]