There is a general rule that people shouldn't sell their houses until they have lived in them for at least five years. However, life changes sometimes make selling a house earlier than expected an appealing option.

There are multiple factors that can affect the home sale process, and state laws may even derail it completely. Still, some steps in the process are fairly standard.

Accepting an Offer

A house is considered sold when the seller accepts an offer from a buyer. However, this is not the end of the process, and there are many things that can go wrong between accepting an offer and closing.

Buyers will often include contingencies in their offers to protect themselves against unforeseen issues or changes of heart. These common contingencies include a home inspection, mortgage lender approval, and an appraisal. In addition, the buyers will need to submit a deposit, sign numerous legal documents, and complete the closing process.

When a buyer's contingencies are satisfied, the seller can formally accept their offer and put the property under contract. The buyer will then need to complete the closing process at a title company, escrow office, or attorney's office. Once the closing is completed, the seller will receive their sales price and the new owner will take possession of the property. The closing date will be set in the purchase agreement.

Signing a Purchase Agreement

Depending on the circumstances, buyers or sellers may prepare a purchase agreement (also known as a PSA or contract of sale). This document includes signatures from the buyer and seller as well as their real estate agents.

The contract of sale typically outlines all the key terms of the transaction, including the purchase price and closing date. It also describes any contingencies that must be met, such as inspections or loan approval. It also lists a timeframe within which the contingencies must be removed or else the sale could be terminated.

Contingencies are important because, for instance, if the property fails to appraise at or above the agreed-upon value, the buyer may be able to back out of the deal. Additionally, buyers often need to have their mortgage file approved by the lender, which can take days or weeks. This process requires careful coordination to ensure all contingencies are satisfied on time. Moreover, it is critical to make sure there are no issues with the title, such as liens or legal claims that could affect the transfer of ownership.

Completing the Closing Process

Once all of the contingencies outlined in the contract have been satisfied or waived, financing and appraisal requirements are met, and the closing process is complete, you can consider your home sold.

A lot of work goes into preparing for the sale of your house. You'll need to make sure the property is in move-in condition, that you've lined up necessary mortgage financing and that your attorney conducts a title search and searches for any outstanding liens.

You'll also need to make sure you haven't made any significant purchases during the escrow period and that all of your personal possessions are removed from the property (unless you arranged for them to stay). Once all the paperwork has been signed, the escrow officer transfers the money from the sale to everyone involved. Closing usually takes a few hours and once you've received the keys, your home is considered sold. Then it's time to change your address, meet your neighbors and start a new chapter of your life!

Clear Title

A home is considered sold once the seller no longer owns it and the deed has been transferred to the buyer. The transfer process can take time, as buyers must get preapproved for a mortgage and complete their inspections of the property. During this period, home sellers should complete any necessary repairs to make the property more appealing and inspire confidence in buyers.

Clear titles offer legal protection, unlock financing opportunities, establish marketability, and mitigate risks and future disputes. For example, if a property developer conducts a title search and discovers that there are unreleased liens on the property, they can correct this issue before proceeding with the sale to prevent any legal complications in the future. This can save the developer time and money, and ultimately ensure that the transaction proceeds smoothly. Buyers and lenders both rely on clear titles when conducting due diligence, so it is in everyone’s best interest to ensure that all issues are resolved before closing.