While every home sale is different -- with unique contingencies based on the needs and situations of the buyer and seller -- there are three main hurdles that most buyers and the houses they are purchasing must clear to make it to closing.

So -- where is your contract in this process?  Have you cleared 1, 2 or 3 of the hurdles, thus far?  There will be plenty of other details to attend to, but these are the three main areas of focus.  Evaluating the property condition, the property value, and the buyer's finances....

INSPECTION - This is an evaluation, by a home inspector, of the condition of the house.  Clearing this hurdle typically involves requesting that the seller make some repairs to the house (or negotiate further on price) based on new information about the property condition discovered during the inspection process.

APPRAISAL - This is an evaluation, by an appraiser hired by the purchaser's lender, of the value of the house.  If the property appraises for the contract price (or higher), all is well -- otherwise, the buyer and seller  may need to renegotiate the contract price based on the appraised value.

LOAN APPROVAL - This is an evaluation, by a lender (and their underwriters) of the purchaser's financial situation.  The lender must confirm that the buyer has the income to support the mortgage payment required for purchasing the home.

Again - there are many other smaller hurdles (for example, a termite inspection) and larger hurdles (for example, a home sale contingency) that may need to be cleared in your purchase (or sale) of a home -- but these three main hurdles (inspection, appraisal, loan approval) are the three main mileposts during the contract-to-closing process that we'll be focused during the transaction.

BUT WAIT -- THERE'S MORE....

Would you rather have three main hurdles to clear, or six?

Let's imagine that you receive two offers on your house, which is listed for $250K....

• Offer 1 = $245K, contingent on an inspection, appraisal and loan approval
   
  
• Offer 2 = $250K, contingent on a home sale, inspection, appraisal and loan approval
  

In Offer #2 -- even if the house that they need to sell is already under contract, you must remember that by accepting a contract with a home sale contingency, you are likely, effectively doubling up on all of the main contract contingencies.  You're setting out six hurdles to be cleared, instead of just three. 

• The home inspection must be resolved successfully on your home, as well as your buyer's current home. 
   
• The appraisal must be approved on your home, as well as your buyer's home. 
   
• You're waiting on your buyer's loan approval, as well as your buyer's buyer's loan approval.

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Have any questions? Contact Scott Rogers at 540-578-0102 or scott@funkhousergroup.com